To:



1.3 Firm Employee and Family Member Accounts (FEFM Accounts)

Employees are expected to maintain their personal investment securities accounts in a manner in which each subject account can be readily supervised and monitored by the designated supervisory and compliance staff of Piper Jaffray. To this end and in light of the limited services that Piper Jaffray now offers, in addition to the option of holding a securities account at Piper Jaffray, arrangements have been made with several outside broker/dealers to carry employee and employee-related securities accounts for those individuals who are desirous of or require services not currently offered by Piper Jaffray. The approved outside broker/dealer firms are listed on the Trading Post at .

1.3.1 Firm Employee and Family Member Accounts Defined

Accounts covered by this policy include any and all accounts that fall within one of the below listed account types, and shall be referred to as a “Firm Employee or Family Member (FEFM) Account,” regardless of where the account is maintained.

• Accounts in the name of a Piper Jaffray employee;

• Accounts in the name of: (i) a spouse, (ii) a domestic partner, (iii) a minor child, or (iv), and/or (v) accounts for any person who is materially supported, directly or indirectly, by the employee;

• Accounts in which any person described in the first two bullets above has discretionary authority or acts with discretion in fact; and

• Accounts in which any person described in the first two bullets above has any beneficial interest. A “beneficial interest” includes, but is not limited to, a partial or contingent ownership interest in the account or a fiduciary role with respect to the account (e.g. a trust, investment club, etc.)

2. Disclosure of FEFM Accounts

Employees are required to disclose their FEFM accounts as follows:

• New employees complete Form E0703, and submit it for approval.

• When opening an account, the employee is responsible for ensuring it is coded for the appropriate NASD “restricted status.”

• All employees are required to disclose FEFM accounts during the annual certification distributed by Compliance.

3. Outside Securities Accounts

Employees may maintain outside employee-related accounts held directly with a mutual fund or funds (e.g. accounts in which purchases and sales are restricted to open-end mutual fund shares only), without approval from a manager (as described in Section II.A.) or Compliance. These accounts, however, will still be required to be disclosed during the annual employee certification of accounts held outside of the firm.

Employees who wish to engage an investment advisor with full investment discretion with respect to a FEFM account must seek prior written approval from their appropriate manager, as similarly required for accounts held outside of the firm. Written approval should be given only where the investment advisor has full discretion and the employee certifies, in writing, that he or she will not have the ability to instruct (or make recommendations to) his or her investment advisor to effect a trade in a particular security. In the event that such an arrangement is approved, the approving manager, together with Compliance, should: (a) determine whether any conditions or restrictions should apply, and, if applicable, (b) require that the employee communicate any such conditions or restrictions to the investment advisor.

NOTE: A registered representative at an outside broker/dealer acting pursuant to a Trading Authorization does not qualify as an “investment advisory” relationship.)

Exceptions to this policy may be granted only in extraordinary circumstances and must be approved in writing by the employee’s manager, their management committee member and Compliance. Employees must fill out and submit Form E0777 (on the Trading Post under Company Information/Forms Repository) to the appropriate distribution list to make the request. Once received and approved by Compliance, Compliance will arrange for Piper Jaffray to receive duplicate confirmations and statements.

4. Personal Private Securities Investments

Employees who wish to personally invest in a private securities transaction, either through Piper Jaffray or outside of the firm, are required to complete and submit to Compliance Form E0748 prior to participating in the transaction. This includes a personal investment in unregistered securities, direct offerings, private placements, limited partnerships, and/or other securities investments.

5. Order Entry and Settlement Policies Applicable to all Employees

The primary focus of Piper Jaffray employees during the course of the business day shall be the efficient and effective conduct of the Firm’s business activities, which shall at all times be conducted with the best interests of the Firm’s clients, first and foremost in mind. Concentrated attention during the business day by employees to their personal trading activities is inconsistent with this premise, and consequently, employees are encouraged to make long-term investments and discouraged from trading excessively. Employees should avoid any activity that might create the appearance of impropriety or be viewed as a conflict of interest with respect to their activities conducted on behalf of the Firm’s clients or the Firm. Notwithstanding the fact that a particular trade or pattern of trades may not be specifically prohibited in these Policies and Procedures, Compliance or designated supervisory personnel may deem certain activity inconsistent with the Firm’s policies and instruct an employee to refrain from such trading activity and/or instruct such employee to unwind any position(s).

1. Entering Orders

All FEFM accounts will be housed under an employee branch code serviced by the Corporate and Venture Services (CVS) Department. Individual employees are prohibited from executing their own trades, regardless of whether or not hey have and assigned representative number.

Suitability of all transactions in a FEFM account is the responsibility of the employee account owner.

Employees are responsible for checking the restricted list prior to executing a trade. Due to the fact that trading restrictions applicable to FEFM accounts may be imposed at any time, even intra-day, employees may enter only day orders for their FEFM accounts. “Good-Till-Cancelled” orders are prohibited, as are orders that are good through a date beyond the date of entry. Day limit orders and day stop orders are permissible.

2. Prompt Settlement

All trades must be settled promptly. No extension for settlements of trades will be granted for employee accounts.

1.3.5.3 Post-Trade Review Process and Remedial Actions for Certain Trades

Employee trades are subject to a post-review by the employees’ designated supervisory personnel as well as to monitoring by Compliance. Designated supervisory personnel receive a report of all trades for all FEFM accounts.

If a trade violates these Policies and Procedures or creates the appearance of a conflict or impropriety, the employee may be asked to cancel the trade or the trade may be re-allocated or broken depending on where the account is held. Any resulting losses will be charged to the employee. Additional sanctions may be imposed on any employee who consistently violates these Policies and Procedures, up to and including termination of their employment.

6. FEFM Account Trading Restrictions and Holding Requirements

All employees’ personal trading activities are expected to be conducted in a manner that is consistent with the firms Guiding Principles as well as with published regulatory rules and industry standards that govern employee conduct and ongoing obligations to avoid conflicts of interest.

While not inclusive of all possible violations or inappropriate activity, the following specifically outlines prohibitions and restrictions placed on employee and employee-related trading activities:

1. Prohibition Against Trading on Material Non-Public Information

Employees are prohibited from affecting any trades for their FEFM accounts in any security of any company, including Piper Jaffray Companies, while in possession of material non-public information with respect to the company. Employees should refer to the Chinese Wall Policy for further discussion of the prohibition against trading or tipping while in possession of material non-public information.

2. Prohibition Against Front-Running Client Orders

Employees are prohibited from purchasing (or selling) for their FEFM accounts a security that they know or reasonably expect is or will be the subject of a purchase (or sell) order of block size (or other size sufficient to have market impact) from a client.

3. Trading Restrictions Related to Research Activities

Employees are prohibited from effecting any trade for their FEFM accounts in a security that they know or reasonably expect will be the subject of a specific published research report (including coverage initiations, suspensions and terminations).

Employees are prohibited from affecting any trade for their FEFM accounts in any security during any particular day in which the security is the subject of a research report, research note, research hot comment, or other written comment by the research analyst. For purposes of this policy, written comments made at or after market close will be treated as if the comments were made at the morning meeting the following day.

The Restricted List identifying such restricted securities is located on the General Counsel and Compliance page of the Trading Post, and Compliance will also, prior to the market opening, notify all employees via e-mail of the securities that are restricted that day for trading in FEFM accounts. Be aware, however, that Compliance may also restrict securities intraday based upon research comments released intra-day. Employees are responsible for checking the e-mail restrictions and the Restricted List on Trading Post and should not affect a trade for a security that is subject to a FEFM account restriction.

4. Prohibition Against Trading in Securities on the Restricted List

Employees are prohibited from affecting any trade for their FEFM accounts in any security that is set forth on the firm’s Restricted List. The Restricted List is included on the Compliance Department e-mail discussed in the paragraph above, and is also located on the General Counsel and Compliance page of the Trading Post

5. Prohibition Against Cross Trades with Clients

Except in limited circumstances involving certain liquid fixed income securities, specifically, Unit Investment Trusts, municipal floaters and preferred stock, employees are prohibited from effecting any cross trade in any security for their FEFM accounts with any client account. Contact the Compliance Department for further clarification.

6. Prohibition Against Trades at Prices Better than the Prevailing Market Price

Employees are prohibited from executing trades for FEFM accounts or from receiving trade executions (or allocations of trade executions) for their FEFM accounts at prices better than the prevailing market price at the time of any such trade. The prevailing market price shall be determined by reference to current rules and interpretations of the NASD and other self-regulatory regulatory organizations governing mark-ups and mark-downs.

7. Holding Periods

Except where more restrictive policies apply (e.g., prohibition against position traders trading stocks in which they make markets), and except in the case of certain specific products (see paragraph below), employees are subject to a minimum 20 calendar day holding period with respect to securities positions that they initiate for their FEFM accounts, including positions in convertibles, options and other derivative securities, as well as hedging strategies. This means that an employee may not initiate an options or other hedge position with respect to a previously established position unless the options or other hedge position is opened at the same time, or alternatively, the 20 calendar day holding period has expired with respect to the previously established position.

In the case of closed-end funds, exchange-traded funds (ETFs), ETF options and index options, employees are subject to a 5 calendar day holding period.

There is no required holding period for open-end funds, CDs, municipal bonds or government bonds.

The only circumstances in which an employee is permitted to liquidate or unwind a position or strategy prior to the expiration of the 20 calendar days (or 5 calendar days, in the case of closed-end funds, ETFs, ETF options and index options) are where: (1) the position or strategy has declined in value by 15 percent or more; (2) the position or strategy was established in error, the liquidation or unwinding transaction(s) takes place the business day following the erroneous trade(s), Compliance approves the liquidation or unwinding trade(s) in writing in advance, and any resulting profits are forfeited to the Firm (losses to be borne by the employee if it was his/her error); (3) the position or strategy must be liquidated in order to respond to a tender offer, call for redemption, or other similar initiative; or (4) Compliance approves the early liquidation or unwinding in writing in advance based on special circumstances. Repeated use of exceptions (1) or (2) above to facilitate short term trading strategies will result in revocation of the exception for the person involved.

8. Prohibition Against Purchasing in Offerings and the Immediate Aftermarket

Employees are prohibited from purchasing any security that is part of a public offering or Rule 144A resale being executed by the Equity Capital Markets Desk, regardless of whether the offering is a “hot issue,” either directly in the offering or for one full trading day following the pricing of the offering.

9. Prohibition Against Trading During Non-Deal Roadshows

Employees are prohibited from trading any security of any company on any trading day during which any employee participates in any way (including by conference call) in a non-deal roadshow by company management with institutional investors, and for one full trading day thereafter. Companies subject to this restriction will also be noted on the Compliance email notice.

10. Additional Department-Specific Restrictions

See applicable appendices for additional policies and procedures for specific department personnel within the firm.

7. PJC Common Stock and Convertibles Trading Policy

For the purpose of ensuring that Piper Jaffray employees do not trade the common stock and derivative securities of Piper Jaffray Companies (“PJC”) in a manner that would expose them or the firm to criticism or questions concerning the timing of their trades in PJC stock, in addition to the trading window policy applicable to the executive officers and directors of PJC and certain employees specifically designated by the General Counsel of PJC, all Piper Jaffray employees are subject to the following trading policies with respect to PJC securities:

1.3.7.1 PJC Stock

No Piper Jaffray employee may purchase or sell PJC stock during the period beginning three full business days (a "business day" shall be any day in which the NYSE is open for trading, including shortened trading sessions) prior to PJC's quarterly earnings announcement, and ending one full business day following its earnings announcement. This period shall be referred to as the "Earnings Blackout." For the avoidance of doubt, in the event that PJC announces its earnings prior to the open of regular NYSE trading, Piper Jaffray employees may purchase or sell PJC stock beginning the following business day. In the event that PJC announces its earnings after the close of regular NYSE trading, Piper Jaffray employees may not purchase or sell PJC stock the next business day and must wait until the second business day following the announcement day.

Gifts of PJC stock to bona fide section IRC 501(c)(3) charitable organizations are permissible during the Earnings Blackout.

2. PJC Stock Options

During the Earnings Blackout, no Piper Jaffray employee may exercise any PJC stock options unless the Piper Jaffray employee holds the underlying PJC stock. In other words, during the Earnings Blackout, Piper Jaffray employees may exercise PJC options and hold the PJC stock received upon the exercise of such options but may not exercise PJC options and sell any or all of the PJC stock received upon exercise of such options.

1.3.7.3 PJC Stock Fund

During the Earnings Blackout, no Piper Jaffray employee may engage in fund switching or reallocation transactions into or out of the Piper Jaffray Stock Fund in the Piper Jaffray Retirement Plan, nor may any Piper Jaffray employee receive any cash distribution funded by any amount in the Piper Jaffray Stock Fund in the Piper Jaffray Retirement Plan.

1.3.7.4 Pledging PJC Stock

During the Earnings Blackout, no Piper Jaffray employee may pledge PJC stock.

1.3.7.5 Selling PJC Stock Short

No Piper Jaffray employee may sell PJC stock short at any time, even if the short position is part of a hedging transaction.

1.3.7.6 Derivatives Transactions

Any Piper Jaffray employee who wishes to enter into a derivatives transaction for the purpose of hedging PJC stock may not initiate any part of such a hedge or unwind any part of such a hedge during the Earnings Blackout. Moreover, no Piper Jaffray employee may enter into any derivatives transaction at any time if the effect of such a transaction would be substantially equivalent to a short position in PJC stock or any standardized options strategy other than a covered call or protective put. No employee may utilize any options strategy, including covered calls and protected puts, with respect to non-transferable PJC securities (including, without limitation, PJC restricted stock granted to employees under a Piper Jaffray compensation or incentive plan or program).

1.3.7.7 Material, Nonpublic Information

Notwithstanding any of the above restrictions, Piper Jaffray employees may not purchase or sell PJC stock at any time that the employee is in possession of material non-public information regarding PJC whether or not a firm wide Earnings Blackout is in place.

................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download