Exhibit 10.3

2010            

Code of

Professional Conduct

E*TRADE FINANCIAL CORPORATION

Corporate Policies and Procedures

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COPYRIGHT 2002, 2004, 2006, 2008, 2010 E*TRADE FINANCIAL Corporation

New York, NY

Revised December 29, 2010

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Table of Contents

 

INTRODUCTION

     1   

STATEMENT OF ETHICS

     1   

Business Operations

     1   

Treatment and Conduct of Employees, Officers and Directors

     1   

Interaction with Business Partners, Potential Business Partners and Competitors

     2   

PURPOSE OF THE CODE

     2   

REPORTING VIOLATIONS

     2   

THE CODE OF PROFESSIONAL CONDUCT AND YOUR EMPLOYMENT

     3   

Code of Professional Conduct Is Not an Employment Contract

     3   

Consequences of Violating the Code of Professional Conduct

     3   

STANDARDS OF CONDUCT

     4   

RESPONSIBILITIES UNDER THE LAW

     4   

Securities Laws

     4   

Exchange and Self-Regulatory Organization Rules

     5   

Banking Laws and Regulations

     5   

Licensing, Registration and Reporting of Specified Arrests, Convictions or Civil
Actions

     5   

Personal Legal Matters

     5   

Proper Record-Keeping and Disclosure Requirements

     6   

Insider Trading

     6   

Records Management and Records Retention Requirements

     7   

Antitrust and Trade Regulation Laws

     7   

Tied Products and Services

     8   

Avoiding Improper and Corrupt Payments, Including the Foreign Corrupt Practices
Act

     8   

Economic Sanctions

     8   

International Anti-Boycott Laws

     9   

Anti-Money Laundering and Anti-Terrorism Laws

     9   

Intellectual Property Protection

     9   

Privacy Laws and Regulations

     10   

Employee Accounts

     11   

DEALING WITH THIRD PARTIES

     11   

Authority to Act on Behalf of E*TRADE

     11   

Conflicts of Interest

     11   

Acceptance of Gifts, Meals or Entertainment

     12   

Providing Gifts, Meals or Entertainment

     13   

Approval of Nonconforming Gifts, Meals or Entertainment

     13   

Selecting Suppliers

     13   

Standards of Conduct Demanded of Third Parties

     14   

Requests for Legal, Financial or Tax Advice

     14   

Advertising

     14   

Charitable Contributions

     14   

Communications with the Media and other Third Parties

     14   

Internet Access and Social Media

     15   

Outside Lawyers

     15   

Treatment of Privileged Communications and Documents

     16   

LITIGATION, INVESTIGATIONS, INQUIRIES AND COMPLAINTS

     16   

DEALINGS WITH E*TRADE

     17   

Protecting E*TRADE’s Assets

     17   

Use of E*TRADE’s Information and Communications Systems

     17   

 

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Monitoring of Communications and Files

     18   

Substance Abuse

     18   

NON-DISCRIMINATION AND ANTI-HARASSMENT POLICY

     19   

Equal Employment Opportunities

     19   

Discrimination and Harassment Are Against E*TRADE Policy and Are Illegal

     19   

Workplace Violence Is Prohibited

     20   

Retaliation Is Prohibited

     20   

Individuals Covered

     20   

Reporting an Incident

     20   

Investigation of Allegations

     20   

Consequences of Inappropriate Behavior

     21   

HANDLING PROPRIETARY AND CONFIDENTIAL INFORMATION

     22   

Safeguarding Materials Containing Proprietary or Confidential Information

     22   

Communicating Proprietary or Confidential Information

     23   

Disposal of Proprietary or Confidential Waste

     23   

Proprietary or Confidential Information Concerning Securities

     23   

Ownership of Intellectual Property

     23   

Preventing Improper Use of Proprietary or Confidential Information

     24   

TREATMENT OF INSIDE INFORMATION

     25   

POLICY ON THE TREATMENT OF INSIDE INFORMATION

     25   

Definition of Inside Information

     25   

Prohibited Uses of Inside Information

     25   

Guidelines for Information about E*TRADE

     26   

Handling Rumors

     26   

Consequences of Misusing Inside Information

     26   

The Restricted List

     26   

OUTSIDE BUSINESS ACTIVITIES

     27   

Outside Directorships, Industry-Related Organizations, Residential Boards and
Charities

     27   

EMPLOYEE TRADING

     28   

E*TRADE Employee Trading Policies and Practices

     28   

The Restricted List

     29   

Transactions in E*TRADE Securities

     29   

ACKNOWLEDGEMENT

     31   

 

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Introduction

E*TRADE is committed to upholding the highest standards of ethical conduct,
honesty and integrity.

E*TRADE1 is committed to being a leader in the financial service industry and to
do so we must operate in accordance with the highest standards of ethical
conduct, honesty and integrity and, above all, a commitment to our customers and
stockholders. Accordingly, each employee, officer and director of E*TRADE
(“you”) must abide by the Statement of Ethics below and this Code of
Professional Conduct.

STATEMENT OF ETHICS

E*TRADE pledges to ensure that we operate our business and serve our customers
and stockholders by acting in accordance with the highest standards of ethical
conduct, honesty and integrity. E*TRADE is committed to the following
principles:

Business Operations

 

  •  

We are committed to providing the best customer services to meet our customers’
needs.

 

  •  

We market our products and services in an honest and fair manner.

 

  •  

We do not compromise our values.

 

  •  

We do not use Inside Information (as discussed in Section 5 below) about E*TRADE
or other companies for personal profit or gain.

 

  •  

We will safeguard any confidential information entrusted to us.

 

  •  

We adhere to all laws and regulations applicable to our business.

Treatment and Conduct of Employees, Officers and Directors

 

  •  

We treat all employees, officers and directors equally and fairly.

 

  •  

We do not tolerate any form of harassment.

 

  •  

We do not tolerate anyone asking our employees, officers and directors to break
the law, or violate E*TRADE’s policies, procedures or values.

 

  •  

We provide employees, officers and directors with the information and necessary
facilities to perform their jobs and functions in a safe manner.

 

  •  

We do not tolerate anyone using, bringing or transferring illegal items on
E*TRADE property.

 

  •  

We require you to report any suspicious activities.

 

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Throughout the Code, the term “E*TRADE” or the “Company” refers to E*TRADE
Financial Corporation and its subsidiaries and affiliated entities, including
subsidiaries outside the United States. To the extent that anything in this Code
of Professional Conduct is inconsistent with a local rule, regulation or law,
the local rule, regulation or law will take precedent.

 

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  •  

We do not tolerate the use of E*TRADE resources for personal gain or any
non-business purpose.

Interaction with Business Partners, Potential Business Partners and Competitors

 

  •  

We avoid conflicts of interest and work to identify situations where they may
occur.

 

  •  

We do not accept or give gifts, favors, or entertainment in excess of legal and
regulatory limitations, as more fully described in the policy entitled Gifts to
and From Customers, Suppliers and Others.

 

  •  

We respect our competitors and do not use unfair business practices to hurt our
competition.

 

  •  

We do not have formal or informal discussions with our competitors on prices,
markets, products, services or production, service or inventory levels.

PURPOSE OF THE CODE

In order to ensure that E*TRADE’s employees, officers and directors conduct
themselves in accordance with the highest standards of ethics, honesty and
integrity, E*TRADE has adopted this Code of Professional Conduct (the “Code”),
which sets forth standards for conduct for all of our employees, officers and
directors.

It is the responsibility of each employee, officer and director of E*TRADE to
comply with the applicable provisions of this Code, as well as all applicable
laws, rules and regulations and all of E*TRADE’s corporate policies and
procedures applicable to them. Because the Code does not address every possible
situation that may arise, E*TRADE employees, officers and directors also are
responsible for exercising their best judgment, applying ethical principles, and
raising questions when in doubt. Integrity and good judgment enhance the E*TRADE
brand, help build E*TRADE’s reputation, and are the foundation of trust for our
customer, supplier and community relationships.

Should anyone covered by this Code have questions regarding ethical principles
or conduct, E*TRADE has a number of available resources, including the following
departments: Legal, Compliance, Internal Audit, Human Resources and Corporate
Information Security and Fraud Management. In addition, E*TRADE employees are
encouraged to direct questions regarding business conduct to their supervisors.

The Code provides an overview of some of E*TRADE’s key policies and should be
read in conjunction with all relevant E*TRADE policies and procedures. It is
your responsibility to become familiar with and adhere to all policies and
procedures referenced in this Code and any other policies or procedures
applicable to your business unit or in the conduct of your duties as an
employee, officer or director of E*TRADE. Most corporate policies are posted on
My Channel*E. New employees should ask their supervisor for all policies that
apply to their business unit. We recognize that members of the E*TRADE Financial
Corporation Board of Directors are subject to additional guidelines and policies
which shall govern in the case of any conflict with the Code.

REPORTING VIOLATIONS

As an E*TRADE employee, officer or director you are E*TRADE’s first line of
defense against civil or criminal liability and unethical business practices. If
you know of, observe, suspect or otherwise become aware of a violation of
applicable laws, rules, regulations, this Code or any of E*TRADE’s other
policies or procedures, you must report this information immediately. As an
employee, such matters can be reported to your direct supervisor or any other
appropriate representative of E*TRADE senior management. If you believe that the
person to whom you have reported a potential violation has not taken appropriate
action, you must contact the Legal, Compliance, Internal Audit or Human
Resources Department directly. As an officer or director you should report any
such matter to the Legal, Compliance, Internal Audit or Human

 

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Resources Department directly in the first instance. If you believe that you may
have violated an applicable law, rule or regulation or this Code or any other
E*TRADE policy or procedure, you must immediately report such violation to the
Legal, Compliance, Internal Audit or Human Resources Department directly.

As an alternative to direct reporting to one of the Departments above, E*TRADE
has engaged ListenUp, an outside firm through which you may anonymously report
any suspected violations of an applicable law, rule or regulation or this Code
or any other E*TRADE policy or procedure. You can access ListenUp at
www.listenupreports.com. Additional information regarding ListenUp is available
on My Channel*E.

THE CODE OF PROFESSIONAL CONDUCT AND YOUR EMPLOYMENT

Code of Professional Conduct is Not an Employment Contract

As an employee and/or director of E*TRADE, this Code and the applicable policies
and procedures contained in this Code form a part of the terms and conditions of
your employment and/or professional relationship with E*TRADE. However, the Code
is not a contract, express or implied, guaranteeing progressive discipline or
employment for any specific duration or entitling you to bonuses or other forms
of compensation. Except in certain jurisdictions outside the U.S., employment at
E*TRADE is “at will,” meaning that either E*TRADE or you may terminate your
employment relationship at any time, with or without cause.

Consequences of Violations of the Code of Professional Conduct

As an employee of E*TRADE, violations of the Code may subject you to
disciplinary action by E*TRADE including — without limitation — warnings,
reprimands, temporary suspensions, probation, termination of your employment or
other actions which may be set forth in the specific E*TRADE disciplinary
procedures applicable to the country in which you work or reside. Disciplinary
actions may be taken:

 

•  

against employees who authorize or participate directly, and in certain
circumstances indirectly, in actions which are a violation of applicable laws,
rules or regulations, this Code or any of E*TRADE’s other policies and
procedures;

 

•  

against employees who fail to report or withhold information concerning conduct
that they knew or should have known was a violation of applicable laws, rules or
regulations, this Code or any of E*TRADE’s other policies and procedures, or
withhold information concerning a violation of which they become aware or should
have been aware;

 

•  

against the violator’s supervisor(s), to the extent that the circumstances of
the violation reflect inadequate supervision or lack of diligence by the
supervisor(s);

 

•  

against employees who attempt to retaliate, directly or indirectly, or encourage
others to do so, against an employee who reports an actual or potential
violation of applicable laws, rules or regulations, this Code or any of
E*TRADE’s other policies and procedures; and

 

•  

against employees who knowingly make a false report of a violation.

E*TRADE also must report certain activities to its regulators, which could give
rise to regulatory or criminal investigations. The penalties for regulatory or
criminal violations may include significant fines, permanent bar from employment
in the securities industry and, for criminal violations, incarceration.

 

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Standards of Conduct

RESPONSIBILITIES UNDER THE LAW

Employees, Officers and Directors are responsible for reviewing, understanding
and adhering to all laws, regulations, industry standards and E*TRADE policies
and procedures related to their work activities and professional
responsibilities.

The activities of E*TRADE and its employees, officers and directors are
regulated by governmental entities, such as the Securities and Exchange
Commission (“SEC”), the Office of Thrift Supervision (“OTS”) and various state
regulators and self-regulatory organizations (“SROs”), such as the Financial
Industry Regulatory Authority (“FINRA”). As a result of the recently enacted
financial regulatory reform legislation, E*TRADE will be regulated by a number
of other governmental agencies and SROs. E*TRADE is committed to full compliance
with all applicable laws, rules and regulations and industry standards, as well
as full adherence to the provisions of this Code and all of E*TRADE’s other
policies and procedures. Accordingly, you must comply with all applicable laws,
rules and regulations, industry standards, the provisions of this Code
applicable to you, and all of E*TRADE’s other policies and procedures applicable
to your business unit and relevant to your role with E*TRADE (“Applicable
Requirements”).

Failure to comply with Applicable Requirements can cause significant harm to
E*TRADE, and it can have severe consequences for you personally. Specifically,
you may be held personally liable for improper or illegal acts committed during
your employment or other professional relationship with E*TRADE. Such liability
could subject you to civil or criminal penalties (fines and/or imprisonment),
regulatory sanctions (censure, suspension or industry bar) and disciplinary
action by E*TRADE, up to and including termination of your employment or other
professional relationship with E*TRADE.

The following is a general summary of certain laws and other rules that apply to
E*TRADE. The summary does not address every Applicable Requirement, all of
which, as previously stated, you are required to review, understand and adhere.
Ignorance of applicable laws, regulations, rules, policies or procedures will
not excuse E*TRADE or you from potential penalties or sanctions, including
internal disciplinary action.

Securities Laws

Because E*TRADE is licensed and regulated in a number of jurisdictions, it is
subject to numerous securities laws and rules. These laws and rules address,
among other things, licensing requirements, financial reporting and disclosure,
and insider trading rules. E*TRADE is fully committed to compliance with these
and all other applicable laws, rules and regulations.

 

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Exchange and Self-Regulatory Organization Rules

E*TRADE is a member of many exchanges and SROs that issue and enforce rules
about trading in securities, commodities and related instruments, and about
other aspects of E*TRADE’s business. Violations of exchange or SRO rules can
lead to fines and penalties against you and against E*TRADE.

Banking Laws and Regulations

Because of the nature of E*TRADE’s business, including the operation of
federally charted savings banks, E*TRADE is subject to numerous banking laws and
regulations. Violations of such rules can lead to fines and penalties against
you and against E*TRADE.

Licensing, Registration and Reporting of Specified Arrests, Convictions or Civil
Actions

Many jurisdictions require licensing or registration of individuals who perform
certain activities in the financial services industry. These requirements apply
to many individual E*TRADE employees. All employees are personally responsible
for meeting the registration requirements in the jurisdiction where they are
physically located and wherever they conduct business; and supervisors are
responsible for assuring that personnel under their supervision meet the proper
registration requirements. Employees are responsible for providing requisite
information regarding their licensure and any changes thereto (such as a change
in name or residential address) to E*TRADE for its books and records. Employees
who maintain registrations with FINRA or other SROs are also responsible for
promptly notifying the Compliance Department of any changes in the information
that appears on the employee’s Form U-4. Changes in U-4 information must be made
within 30 days of the date of the change in information. In addition, under
applicable FINRA rules, E*TRADE is required to report certain events, such as
customer complaints and arbitrations, regardless of the merits of such claims.

For further information, please see
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/registrationlicensing/needs.

Personal Legal Matters

E*TRADE must report and disclose certain information regarding arrests or
criminal charges against an employee, including securities or
commodities-related civil litigation, as well as personal financial matters.
Thus, employees must notify their direct supervisor and the Legal and Compliance
Departments immediately if any of the following events occurs:

 

•  

At any time during your employment, you are indicted, convicted of, or plead
guilty or no contest to any felony in a domestic, military or foreign court;

 

•  

At any time during your employment, you are indicted, convicted of, or plead
guilty or no contest to any misdemeanor that involves the purchase or sale of
any security, the taking of a false oath, the making of a false report, bribery,
perjury, burglary, larceny, theft, robbery, extortion, forgery, counterfeiting,
fraudulent concealment, embezzlement, fraudulent conversion, misappropriation of
funds or securities, conspiracy to commit any of these offenses, or any
substantially equivalent activity in a domestic, military or foreign court;

 

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•  

At any time during your employment, you are named as a defendant or respondent
in any securities or commodities-related civil litigation;

 

•  

At any time during your employment, you are named as a defendant or respondent
in any proceeding brought by a governmental agency or SRO alleging a violation
of any securities law or regulation;

 

•  

At any time during your employment, you are found by any governmental agency or
SRO to have violated any provision of any securities law or regulation;

 

•  

At any time during your employment, you receive a subpoena, inquiry or request
from a governmental, regulatory or administrative agency or a claimant,
plaintiff or outside attorney that involves, or has the potential for involving,
E*TRADE;

 

•  

At any time during your employment you receive a customer complaint, whether
made orally or in writing;

 

•  

At any time during your employment you made a compromise with creditors, filed a
bankruptcy petition or have been the subject of an involuntary bankruptcy
petition; or

 

•  

At any time during your employment you have any unsatisfied judgments or liens
against you.

Proper Record-Keeping and Disclosure Requirements

E*TRADE requires honest and accurate accounting and recording of financial and
other information in order to make responsible business decisions and provide an
accurate account of E*TRADE’s performance to stockholders and regulators.
E*TRADE requires and has implemented disclosure controls and procedures to
ensure that its public disclosures are compliant, and otherwise full, fair,
accurate, timely and understandable. Accordingly, employees responsible for
preparing E*TRADE’s public disclosures, or providing information as part of that
process, are responsible for ensuring that such disclosures and information are
full, fair, accurate, timely and understandable in compliance with E*TRADE’s
disclosure controls and procedures.

It is a violation of law and E*TRADE policy for you to attempt to improperly
influence or mislead any accountant engaged in preparing an audit or financial
reports. E*TRADE is committed to full compliance with all requirements
applicable to its public disclosures, and requires that its financial and other
reporting fairly present the financial condition, results of operations and cash
flow of E*TRADE and comply in all respects with applicable law, governmental
rules and regulations, including generally accepted accounting principles
(“GAAP”) and applicable SEC, SRO and OTS rules.

Insider Trading

Federal law and E*TRADE policy prohibits any E*TRADE officer, director and
employee from acting upon material non-public information to benefit yourself or
others. Information is “material” if there is a substantial likelihood that a
reasonable investor would consider it important in making an investment
decision, or it could reasonably be expected to affect the price of an issuer’s
securities.

At times, E*TRADE policies may limit your ability to enter into transactions. In
addition, if you have ongoing possession of non-public information, you may be
prohibited from trading in the securities of the

 

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companies about which you have such information. If you have access to
confidential or non-public information, you must not use or share that
information except in connection with the legitimate conduct of E*TRADE
business. E*TRADE strives to prevent the misuse of material non-public
information by, among other things, limiting access to confidential information,
and limiting and monitoring communications between areas that regularly receive
non-public information and the E*TRADE sales, trading, and asset management
areas. E*TRADE policy regarding insider trading is outlined in more detail in
the General Rules for Employee Trading section below and on My Channel*E at
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/surveillance/associate

Records Management and Retention Requirements

E*TRADE is required by law and by industry regulation to maintain its books and
records in good order and to memorialize the essential terms of its business
agreements. Accordingly, employees must ensure that any E*TRADE documents, books
and records for which you are responsible are accurate and correct in all
material respects. Also, every business transaction undertaken by E*TRADE must
be recorded correctly and in a timely manner in E*TRADE’s books and records.
Thus, any payment made at any employee’s request on E*TRADE’s behalf must be
supported by appropriate and correct documentation.

In addition to appropriate records management, employees must fully comply with
E*TRADE’s document retention and destruction policy. It is a criminal offense to
destroy documents that are subject to a subpoena or other legal process. Once a
legal proceeding has begun, or even when one is threatened or reasonably likely,
E*TRADE must preserve documents relevant to the issues in that proceeding
whether or not anyone has requested the specific documents in issue. Any
employee who fails to comply with this policy, as well as industry regulations
and applicable laws, is subject to termination of employment and may also face
criminal or civil prosecution, fines and penalties.

Notably, E*TRADE’s record management policies and procedures require that
employees review files periodically to ensure that information is current,
essential and consistent with all document retention policies and applicable
laws and regulations and discard drafts, notes, notebooks, diaries, telephone
logs, message slips and other documents when they are no longer useful or not
otherwise required to be retained. In conducting this review, be careful not to
discard documents that must be maintained for stated periods of time under
applicable laws; documents that are the subject of a subpoena; or documents that
employees have been instructed to retain as part of any lawsuit or
investigation. E*TRADE’s policies regarding record retention and management may
be found at:
https://mychannele.corp.etradegrp.com/web/guest/departments/legalaffairs/recordsmgmt.

Antitrust and Trade Regulation Laws

Antitrust and trade regulation laws aim to ensure fair competition in the
marketplace. Generally, these laws prohibit monopolization, price-fixing,
overlapping boards of directors between certain types of companies, exclusive
dealing and “tying” arrangements (discussed below), price or service
discrimination that diminishes competition, deceptive acts and unfair
competition. Antitrust and trade regulation issues often arise in joint
ventures, strategic investments, revenue sharing agreements, and formal or
informal meetings or conversations with competitors, suppliers and other third
parties. Violations of these laws may result in civil or criminal liability and
disciplinary action by E*TRADE, up to and including termination of employment.

Unless authorized by the General Counsel, under no circumstances should an
E*TRADE officer, director or employee:

 

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•  

discuss price, product or service arrangements, or division of market share with
competitors, unless that information has previously been made publicly
available;

 

•  

divulge the identity of E*TRADE’s actual or potential customers or any of the
terms upon which E*TRADE may work with those customers;

 

•  

enter into any agreement obligating any customer either to work exclusively with
E*TRADE or not to purchase securities or services from a competitor;

 

•  

enter into any agreement with a third party that involves pricing restrictions
with respect to E*TRADE; or

 

•  

illegally or improperly acquire market or competitive information with respect
to E*TRADE.

Tied Products and Services

“Tying” arrangements, in which clients are required to purchase one product or
service as a condition to another product or service being made available to
them, are unlawful in certain instances. Consult the Legal Department for advice
about tying restrictions.

Avoiding Improper and Corrupt Payments, Including the Foreign Corrupt Practices
Act

Various laws in the U.S. and other countries prohibit providing money or
anything else of value to government officials (including employees and agents
of government-owned entities), political parties or candidates for public office
for the purpose of improperly influencing their actions in order to obtain or
retain business. One such law is the U.S. Foreign Corrupt Practices Act
(“FCPA”), which you should assume applies, regardless of where you are located.
The FCPA prohibits any payment or gift, or any offer or authorization of a
payment or gift, to these entities or individuals in order to secure any
improper business advantage, such as inducing the entity or individual to act
favorably upon, or influence others to act favorably upon, business proposals or
regulatory decisions.

The FCPA and laws like it apply to all E*TRADE-controlled or managed companies,
as well as to all E*TRADE employees, officers, directors and agents, regardless
of citizenship or residency. These laws also prohibit payments made directly as
well as those made indirectly, for example, to agents or intermediaries who
would use the funds for prohibited purposes. Therefore, E*TRADE must select only
reputable agents and must exercise due care in determining the amount of any
compensation it will pay to such agents. You must not hire an agent to act on
behalf of E*TRADE before you have obtained approval from Legal.

Economic Sanctions

E*TRADE policy requires compliance with economic sanctions imposed by the Office
of Foreign Assets Control (“OFAC”) in every country in which E*TRADE does
business. OFAC-imposed economic sanctions and restrictions may be directed at
the governments of certain countries, designated individuals or entities, as
well as certain activities. Employees are required to take appropriate steps to
comply with OFAC-imposed economic sanctions, including being familiar with the
various sanctions programs, operating within E*TRADE’s established communication
channels regarding sanctions programs, and performing adequate due diligence on
their customers.

 

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International Anti-Boycott Laws

U.S. law and E*TRADE prohibit participation in boycotts against countries
friendly to the United States. Furthermore, violations of the anti-boycott
provisions are a criminal offense. Examples of activities that may be perceived
as participating in a boycott include refusing, or requiring another person to
refuse, to do business with a boycotted country, its business concerns, its
residents or nationals. E*TRADE may be required to report these requests, even
though the request was refused. All employees are required to bring such
requests immediately to the attention of Legal.

Anti-Money Laundering and Anti-Terrorism Laws

U.S. Anti-Money Laundering (“AML”) laws aim to prevent, detect and deter money
laundering and terrorist financing. The term “money laundering” covers any
process designed to conceal the true origin and ownership of the proceeds of
criminal activities that changes the identity of illegally obtained money so
that it appears to have originated from a legitimate source. The term “terrorist
financing” covers activities that are ideological rather than profit-based,
which can include providing, collecting or using funds – whether legitimately or
illegally obtained – to carry out a terrorist act.

It is E*TRADE’s policy to comply fully with all federal and state laws and the
laws of other countries concerning the prohibition of money laundering and
safeguard against the financing of terrorist activity, such as the Bank Secrecy
Act, including regulations issued pursuant to the US Patriot Act of 2001; OFAC
regulations; and related laws. To this end, employees must immediately report
any suspicious or unusual activity relating to any E*TRADE customer or employee
to the appropriate AML Compliance Officer or Corporate Security and Fraud
Management.

In addition to severe criminal and civil penalties, violations of anti-money
laundering laws will result in disciplinary action, including possible
termination, and any act by or on behalf of E*TRADE or its employees that
assists in money laundering could be a serious criminal offense. Failure to
report suspicions of money laundering to the relevant authorities also may
constitute an offense and could involve significant penalties for E*TRADE, as
well as the individuals involved. Finally, employees are prohibited from
alerting a customer or other E*TRADE employees (outside of those responsible for
managing the situation) of your suspicion, as this may also be an offense in
certain jurisdictions. Each regulated entity has developed comprehensive
policies and procedures with respect to anti-money laundering. For specific
policies and procedures applicable to your business unit, check with your AML
Compliance Officer or review the link below.

E*TRADE’s AML policies and procedures can be accessed on My Channel*E, as
follows: Bank:
https://mychannele.corp.etradegrp.com/web/guest/departments/bankcompliance/policies
(see Bank Secrecy Act Policy); and Non-Bank (Brokerage; Clearing; Corporate):
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/wsp.

Intellectual Property Protection

Most jurisdictions offer some form of legal protection for intellectual
property, including copyrights, patents, trademarks and trade secrets.

Copyright laws govern the display and reproduction of copyrighted material,
which includes most books, magazines, newspapers, websites, research reports and
software. You cannot display or reproduce copyrighted material without the
permission of the copyright owner. Because copyright laws are complex,

 

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you must contact Legal before displaying, publishing or reproducing material
subject to copyright protection.

Patent laws govern the right to make, use and sell a patented invention. Certain
software applications and business methods may be subject to patent protection.
If you develop a software application, business method or invention during the
course of your employment with E*TRADE, you must document the development and
consult with your direct supervisor and Legal concerning its patentability.
Similarly, before introducing or using a software application, business method
or invention that is similar to that of another company, inventor or person,
particularly in the financial services industry, you must consult with the Legal
Department. Please note that E*TRADE owns all rights in any intellectual
property developed by employees during your employment that relate to E*TRADE’s
business, even if invented or otherwise developed outside E*TRADE premises and
even if no E*TRADE equipment was used in the process. Additional information is
available in this Code under “Ownership of Intellectual Property.”

Trademark laws govern the use of product or brand names, service marks, and
trade names that the public associates with a particular product or service. You
must obtain prior approval of all uses of E*TRADE’s trademarks, service marks
and trade names from the Legal Department. In addition, before adopting any new
names for product or service offerings, you must have the approval of the Legal
Department. For further information consult
https://mychannele.corp.etradegrp.com/web/guest/departments/legalaffairs/trademarks.

Trade secret protection governs the disclosure and use of information that the
owner has endeavored to hold secret, usually because the information provides
the owner with a competitive advantage. It is not necessary that the information
be subject to copyright, patent or trademark protection in order to constitute a
trade secret.

E*TRADE’s policies govern situations in which employees develop, create or
receive any materials in the course of employment by E*TRADE that may be
entitled to protection under intellectual property or other laws. Additional
obligations and restrictions are set forth in the new hire documents you
received at the commencement of your relationship with E*TRADE. Questions
concerning these policies, rules and requirements can be directed to the Legal
Department.

Privacy Laws and Regulations

E*TRADE is fully committed to complying with the privacy and data protection
laws applicable to its worldwide operations. E*TRADE employees are required as a
condition of their employment to agree to maintain the confidentiality of
Proprietary Information (as defined below in this Code), including customer and
employee information, to which they may have access during the course of their
employment. Dis-closure of any such information must be done in accordance with
internal policies and procedures and E*TRADE’s privacy statement which is
available on My Channel*E:
https://mychannele.corp.etradegrp.com/web/guest/knowledge/policies/privacy.

In addition to E*TRADE’s privacy statement, there may be other laws,
regulations, contractual obligations or internal policies and procedures, that
require even stricter handling of information and in certain circumstances, may
prohibit sharing of information among E*TRADE entities and E*TRADE employees.
For any questions regarding the disclosure of Proprietary Information, or
compliance with any privacy laws, regulations, contractual obligations or
internal policies and procedures, you must contact the Legal or Compliance
Department or E*TRADE’s Privacy Officer.

 

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Employee Accounts

To comply with industry regulations, employees and their immediate family
members (members of the same household) must maintain their securities accounts
at E*TRADE, unless the employee receives prior approval from the Compliance
Department. In addition, employees of certain business areas may be subject to
pre-clearance requirements in regard to their personal trading activity.
Additional information regarding this requirement can be accessed on My
Channel*E:
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/surveillance/associate

In addition, employees, officers and directors of E*TRADE who maintain bank or
brokerage accounts at E*TRADE must keep those accounts in good standing and
conduct all transactions with integrity and good faith. Remember, as employees,
officers and directors of E*TRADE, we each have a fiduciary duty to E*TRADE, and
our actions must reflect this duty.

DEALING WITH THIRD PARTIES

Authority to Act on Behalf of E*TRADE

Employees and directors cannot commit or bind E*TRADE to any contracts or other
obligations unless they have the express authority to do so. Except with respect
to trading activities performed by registered brokers and customer service
representatives on behalf of our brokerage customers in the regular course of
business, only certain individuals (typically members of the entity’s board of
directors, and its officers, vice presidents (“VPs”), executive vice presidents
(“EVPs”) or senior vice presidents (“SVPs”) may enter into commitments on behalf
of E*TRADE, which include signing contracts on behalf of any E*TRADE entity. All
contracts must be reviewed by Procurement and approved by the Legal Department
(depending on the subject of the agreement) before they are signed. Certain
contracts also require approval of the Technology Infrastructure Committee,
Vendor Management or Finance. In addition, various business units and
departments have special approval requirements for commitments of a certain
size. You should consult with your supervisor to learn of any such policies.
E*TRADE’s Contract-Signing Authority Policy is posted on My Channel*E, and you
should contact the Legal Department with any additional questions regarding
authority to bind E*TRADE to obligations with third parties. This Policy can be
accessed at:
https://mychannele.corp.etradegrp.com/web/guest/departments/legalaffairs/contracts.

Conflicts of Interest

Separate and apart from applicable laws, rules and regulations, employees have a
primary business and ethical responsibility to E*TRADE to avoid any activity or
relationship that may interfere, or have the appearance of interfering, with the
performance of your duties in a loyal, efficient manner to the best of your
ability. Such activities and relationships, called “conflicts of interest,”
include any interest, relationship or activity that is incompatible or has the
appearance of being incompatible with the best interests of E*TRADE, or which
potentially affects or has the appearance of affecting your objectivity as an
employee.

Depending on your particular responsibilities, potential conflict of interest
situations may include, but are not limited to:

 

•  

using E*TRADE’s premises, assets, information or influence for personal gain;

 

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•  

causing E*TRADE to purchase services or products from family members or
businesses in which you or your family have or may have an interest, unless
approved to do so after disclosing the pertinent facts to your direct supervisor
as well as the Legal and Compliance Departments;

 

•  

serving as a director, officer, employee, partner, consultant or agent of an
enterprise that is a present or potential supplier, or a competitor of E*TRADE;
or that engages or may engage in any other business with E*TRADE;

 

•  

owning a material amount of stock, being a creditor or having any other
financial interest in an enterprise described above;

 

•  

having any other significant direct or indirect personal interest in a
transaction involving E*TRADE;

 

•  

obtaining or using for personal benefit confidential information regarding an
enterprise described above, or providing confidential information regarding
E*TRADE or its business to such an enterprise;

 

•  

appropriating for personal benefit a business opportunity that E*TRADE might
reasonably have an interest in pursuing, without first making the opportunity
available to E*TRADE; or

 

•  

engaging in outside activities that detract from or interfere with the full and
timely performance by an employee of all of his or her duties for E*TRADE.

Other than members of the E*TRADE Financial Corporation Board of Directors, who
must adhere to the Corporate Governance Guidelines adopted by the Nominating and
Corporate Governance Committee (“Corporate Governance Guidelines”) including
seeking approval of such committee, your involvement in any outside business
activities requires the prior approval of E*TRADE. If you have any questions,
review E*TRADE’s policies on “Outside Business Activities” outlined in this Code
and/or contact the Compliance Department.

Acceptance of Gifts, Meals or Entertainment

In general, employees and officers may not accept gifts or excessive
entertainment from customers, vendors, suppliers or others having or seeking
business dealings with E*TRADE. Cash gifts or their equivalent may not be
accepted under any circumstances (e.g. gift checks); however gift cards which
are non-redeemable for cash are permitted to be accepted as long as they
otherwise comply with the provisions of this Code. Non-cash gifts may be
accepted when permitted under applicable laws, rules and regulations if they are
(1) nominal in value (i.e., less than or equal to US$100); (2) appropriate,
customary and reasonable meals and entertainment at which the giver is present,
such as an occasional business meal or sporting event; or (3) appropriate,
customary and reasonable gifts based on family or personal relationships, and
clearly not meant to influence E*TRADE business.

In addition to the restrictions in the paragraph above, nominal non-cash gifts
(with a value less than or equal to US$100) and entertainment should only be
accepted if a reasonable person would be satisfied that the gift or
entertainment did not influence the employee’s or officer’s judgment or the
performance of your duties. Under no circumstances may employees and officers
accept any gifts or entertainment that could create a conflict of interest or
the appearance of impropriety. The Compliance Department maintains a log of
gifts received by all employees. Any employee who receives a gift must report it
to the Compliance Department. If employees and officers have any questions

 

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regarding the appropriateness of a gift or entertainment, employees and officers
must contact the Compliance Department or send an email to:
associatesurveillance@etrade.com before accepting the gift or attending the
event.

Providing Gifts, Meals or Entertainment

E*TRADE policy, applicable laws, rules and regulations may prohibit employees
and officers from giving gifts in excess of specified monetary levels (or of any
value) to customers, vendors, suppliers, E*TRADE employees and other third
parties, including persons employed with a stock exchange, regulatory authority,
financial institution, broker-dealer, or the news or financial information
media. More specifically, SRO rules currently prohibit E*TRADE employees from
providing gifts in excess of $100.00 per person annually to the third parties
outlined above. If you have any questions regarding these SRO rules, contact the
Compliance Department or send an email to: associatesurveillance@etrade.com.

When permitted by law and consistent with accepted business practices and
ethical standards, employees and officers may give gifts of nominal value or
provide meals or entertainment to customers, vendors, suppliers and other
persons who have business relationships with E*TRADE. No gifts should be given
or entertainment provided if public disclosure of the circumstances would
embarrass E*TRADE or the giver of such gift or provider of such entertainment.

Special restrictions often apply to gifts and entertainment of government
employees, even of nominal value. In addition, political contributions may be
subject to the rules of the Municipal Securities Rulemaking Board and employees
are required to comply with such rules. If you have any questions regarding
these rules, contact the Compliance Department or send an email to:
associatesurveillance@etrade.com.

Customer entertainment expenses are generally not considered gifts if employees
are present, the provision of the entertainment is routine, and the expense is
not excessive. Please see the Section of this Code on the Foreign Corrupt
Practices Act and contact your supervisor or the Compliance Department for
further details.

Employees and officers must provide complete and accurate expense reports for
all gifts and entertainment expenses paid for by E*TRADE.

Approval of Nonconforming Gifts, Meals or Entertainment

The Chief Executive Officer and the Executive Vice President responsible for
each employee’s business unit, together with the appropriate Compliance Officer
and the Company’s Secretary and General Counsel, may approve, on a case-by-case
basis, the acceptance of a gift, meal or entertainment that is not specifically
permitted under this Section or that is prohibited under this Section. Any such
approval must be in writing and pursuant to full written disclosure of all
relevant facts, including the name of the donor, the circumstances surrounding
the offer and acceptance, the nature and approximate value of the gift or other
event, and the reason why it cannot or should not be returned or refused.

Selecting Suppliers

E*TRADE requires employees, together with the Procurement team, to evaluate
competing suppliers by their long-term financial stability and the price and
quality of their products or services. Personal relationships should not be (or
be perceived to be) a factor in the decision to use a particular supplier.

 

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Additional information regarding suppliers may be found at:
https://mychannele.corp.etradegrp.com/web/guest/departments/procurement.

Standards of Conduct Demanded of Third Parties

E*TRADE’s vendors, suppliers, contractors and agents are expected to operate
with the same commitment to the law and to ethics that we demand of ourselves.
E*TRADE employees should make it clear in their dealings with third parties that
we expect third parties to meet the highest ethical standards in their dealings
with E*TRADE and to be in full compliance with the law.

Requests for Legal, Financial or Tax Advice

Customers may request legal, financial or tax advice about securities or other
issues because they assume that our employees are knowledgeable about these
areas. E*TRADE’s policy, however, prohibits employees from giving legal or tax
advice to a customer. Certain employees may be permitted to provide financial
advice to customers but only to the extent that any such employees are
specifically licensed to provide advice and have been authorized by E*TRADE to
do so. Any questions relating to the provision of financial advice to customers
should be directed to the Compliance Department.

In all cases, customers should be advised to consult their own counsel for legal
advice and to consult their own tax advisors for tax guidance.

Advertising

Only the Marketing Department is authorized to arrange for advertising on
E*TRADE’s behalf, and all marketing promotions and advertisements of any kind
must be approved by the Advertising Review team in the Compliance Department
before any such promotion is launched or any advertisement of any kind is
published or broadcast in any way.

Charitable Contributions

Charitable contributions and giving are coordinated through the Corporate
Contributions Committee. Employees are strictly prohibited from committing
E*TRADE funds for donation without express permission from the Corporate
Contributions Committee.

Communications With the Media and Other Third Parties

E*TRADE values its relationships with the press and maintains routine, ongoing
contact with key publications and broadcast outlets around the world.

Because our corporate communications strategy is coordinated across E*TRADE, our
corporate messaging must be closely managed to ensure that it is concise and
consistent, so only approved spokespersons, working in coordination with
Corporate Communications, are authorized to communicate with the media.
Accordingly, all press or other media inquiries must be directed to Corporate
Communications, and employees are not to make contact with the press or media
without consulting Corporate Communications. This includes “letters to the
editor” or comments to journalists about specific matters that relate to
E*TRADE’s businesses and those that identify you as an employee of E*TRADE. With
respect to press inquiries about legal or regulatory matters or customer
complaints, employees and officers should follow

 

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the procedures outlined in subsequent pages of this Code entitled “Litigation,
Investigations, Inquiries and Complaints.”

Corporate Communications must authorize participation in personal profiles or
stories about “lifestyle” in which E*TRADE is referenced. If employees and
officers wish to appear in articles regarding their activities outside E*TRADE
(philanthropic activities or hobbies, for example), they may do so. However, do
not identify yourself as an employee of E*TRADE or use the name or facilities of
E*TRADE in any way without approval from Corporate Communications.

All press releases and other written communications, including all articles and
commentary, mentioning E*TRADE must be approved by Corporate Communications, the
Legal Department and Advertising Review in the Compliance Department before
being released by E*TRADE, its customers, suppliers or any other organization.

Employees may not endorse the products or services of suppliers or customers on
behalf of E*TRADE unless expressly authorized by Corporate Communications and
the Legal Department. This includes commenting in press articles (including
in-house publications), broadcasts (including internet, radio and television)
and participating in testimonial advertising, promotional brochures or annual
reports. In addition, employees may not permit third parties to use E*TRADE’s
name for endorsements of their products or services without the approval of
Corporate Communications, the Legal Department and Advertising Review within the
Compliance Department.

Internet Access and Social Media

E*TRADE restricts internet access to certain websites, including websites
commonly referred to as social media for all employees; but recognizes that
certain employees may have a business reason to access restricted websites. If
you require such access, then you must enter a Move, Add or Change (MAC) Request
through My Channel*E which includes a valid business reason for the access.
Prior to receiving access to a restricted website, the employee will be required
to agree to additional levels of oversight and supervision by Brokerage
Compliance. Additional detail regarding E*TRADE’s policies and procedures
applicable to internet access and social media websites is available on My
Channel*E at https://mychannele.corp.etradegrp.com/web/life/policy/blogging and
https://mychannele.corp.etradegrp.com/web/life/policy/use

In addition to these restrictions, and regardless of whether an employee has
been granted access to a restricted website, employees may not post entries or
participate in any chat rooms or bulletin board discussions (whether in
real-time or not) during your assigned work hours or from any E*TRADE equipment
(whether using remote access, an E*TRADE laptop, a smart phone or other device)
at any time. In addition, whether at work or outside of work, employees may not
in any way purport to represent E*TRADE or opinions of E*TRADE or identify
yourself as an E*TRADE employee. In short, you may not in any way discuss
E*TRADE (by name or otherwise) in a blog posting, chat room, bulletin board or
any similar electronic or other venue.

Outside Lawyers

Only the Legal Department has the authority to hire outside lawyers on behalf of
E*TRADE. Accordingly, you cannot retain any lawyer or law firm on behalf of
E*TRADE without the express prior approval of the General Counsel, and you must
obtain approval from the Legal Department before speaking to any outside lawyer
regarding E*TRADE.

 

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Treatment of Privileged Communications and Documents

Treat all communications and documents seeking or receiving legal advice or
preparing for litigation as confidential and subject to the attorney-client
privilege. This includes communications with, and documents created at the
direction of, the Legal Department or E*TRADE’s outside counsel. Communicate
such information and documents within E*TRADE on a strict need-to-know basis and
only at the direction of the Legal Department. Do not disclose such information
or documents to anyone outside E*TRADE unless specifically directed to do so by
E*TRADE’s assigned in-house legal counsel.

Documents that are prepared for, or at the direction of the Legal Department or
appropriately retained outside counsel, should be marked “Attorney-Client
Communication, Privileged and Confidential.” Note, however, that merely marking
documents “Privileged” or “Confidential” does not provide legal protection from
disclosure to a regulatory authority or a litigation adversary unless the
document satisfies the legal requirements for the relevant privilege. Similarly,
the failure to write “Privileged” or “Confidential” does not mean that a
privilege is waived. Documents are not protected from disclosure to a regulator
or in litigation merely because the author copies someone in the Legal
Department or because the author believes the documents are personal or private.
Moreover, some foreign jurisdictions do not recognize the legal concept of
privilege. If you have any questions about whether a communication or document
is privileged, consult the Legal Department.

LITIGATION, INVESTIGATIONS, INQUIRIES AND COMPLAINTS

During litigation, an internal investigation, or a governmental, regulatory,
administrative or SRO inquiry, audit or exam involving E*TRADE, you may be asked
to provide information, including documents, testimony or statements to the
Legal and Compliance Departments, E*TRADE’s outside counsel, or a governmental,
regulatory or administrative authority or SRO. You may also be asked to meet
with these entities or persons. As a term and condition of your position with
E*TRADE, you must consider such a request your top priority, and you must
cooperate fully with any such request, in coordination with the Legal and
Compliance Departments, and provide truthful information. You are not permitted
to discuss any such request, or the substance of any discussions or requests,
with any third party, including any individual who may be the subject of an
investigation or inquiry, without prior approval from the Legal and Compliance
Department. If you are contacted by an individual who may be a subject of an
investigation and are requested to provide information about the investigation,
you must inform the individual that you are not permitted to disclose any
information, and you must contact the Legal and Compliance Departments to inform
them of the contact. Failure to do so may subject you to disciplinary action up
to and including termination of your employment In addition, E*TRADE may provide
information, including documents, testimony or statements, concerning you or
your activities at E*TRADE in connection with requests or inquiries by
governmental, regulatory or administrative authorities or SROs. E*TRADE strictly
complies with all laws relating to the privacy of your personal information and
will ordinarily provide you notice prior to producing any such information.
However, it may not be appropriate or possible to provide such notice in every
circumstance. E*TRADE retains the discretion to provide any information in
accordance with applicable law.

 

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DEALINGS WITH E*TRADE

Protecting E*TRADE’s Assets

E*TRADE’s assets include, but are not limited to, its cash and securities, its
premises, its technology, its proprietary and confidential information, its
legally privileged materials, its intellectual property (such as software,
business plans, non-public financial information, ideas for new products or
services, and employee and customer lists), its brand and reputation. Specific
policies with respect to protecting these assets are in E*TRADE’s policy on
“Handling Proprietary and Confidential Information,” which is outlined in this
Code, as well as the “Agreement Regarding Employment and Proprietary Information
and Inventions” signed by employees at the beginning of their employment.
E*TRADE’s Confidential and Proprietary Information Policy can be found on My
Channel *E: https://mychannele.corp.etradegrp.com/web/life/policy/confidential.

In general, employees must use E*TRADE’s assets solely for the benefit of
E*TRADE or its customers. In addition, employees must safeguard these assets by
adhering to E*TRADE’s security policies and procedures. Be alert to incidents
that could lead to the loss, misuse or theft of E*TRADE property. Report all
such occurrences immediately to your direct supervisor and, as appropriate, to
Corporate Information Security and Fraud Management.

Use of E*TRADE’s Information and Communications Systems

E*TRADE maintains certain systems, including telephones, voicemail, electronic
mail, computer networks, personal digital assistants and remote access
capabilities to further E*TRADE’s business objectives. Any systems to which
employees are provided access are to be used for E*TRADE business purposes,
though incidental personal use is permitted. You must adhere to all E*TRADE
policies and procedures and any policies that your business unit or department
may set governing such usage.

In addition, employees may not use E*TRADE’s systems to send, store, view or
forward unlawful, offensive, harassing, discriminatory or other inappropriate
materials or messages or to engage in any outside business activity.
Furthermore, employees may not send, store or forward advertisements,
solicitations or promotions not related to E*TRADE business except as expressly
authorized by E*TRADE. Also, employees are prohibited from using E*TRADE systems
to engage in gambling, illegal activities or any activities prohibited by
E*TRADE policies.

Use sound judgment, business decorum and formality, when composing or forwarding
any electronic communication. Generally, information made available through My
Channel*E is intended for internal use only. Please refer to the policies of
your business unit or department and contact the Legal or Compliance Departments
with any questions on the use of this information.

All software transmitted over, downloaded onto or installed on E*TRADE’s systems
must be done in compliance with applicable laws and licenses and must be
approved in advance by the E*TRADE Technology Department. Unapproved software is
strictly prohibited, including prevention of unauthorized or unlawful use and
transmission of computer viruses. Contact the Legal Department with any
questions.

All electronic communications and internet access must be conducted in
accordance with applicable E*TRADE policies and procedures including but not
limited to the policy governing internet access and social media websites as
well as specific business unit policies pertaining to electronic communications.

 

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The policy pertaining to Internet Access and Social Media Websites is available
on My Channel*E at
https://mychannele.corp.etradegrp.com/web/life/policy/blogging and
https://mychannele.corp.etradegrp.com/web/life/policy/use

Monitoring of Communications and Files

E*TRADE reserves the right to monitor and review all written and electronic
communications that employees send or receive at work or using E*TRADE’s
systems, including electronic mail and other electronic messages, voicemail,
envelopes, packages or messages delivered to E*TRADE, including items marked
“Personal and Confidential.” Authorized persons may, as permitted by applicable
law, access employees’ desk or workspace files, electronic mail and other
electronic messages, voicemail messages, internet usage records, telephone
records, word processing files and other information files (for example, to
monitor compliance with applicable laws, rules or regulations or E*TRADE
policies). In addition, E*TRADE may, subject to applicable law, record and
monitor conversations on E*TRADE telephones, for example, to ensure the accuracy
of transaction records, to comply with applicable laws and regulations, to
evaluate the quality of customer service or to check compliance with E*TRADE
policies. Individual employees are not permitted to record oral or telephonic
communications.

Substance Abuse

E*TRADE seeks to maintain a safe work environment. Therefore, you may not sell,
purchase, use, possess, or be under the influence of any illegal substance while
on E*TRADE’s premises or while conducting E*TRADE business. In addition, you
must abide by all E*TRADE policies concerning the use of alcohol at
E*TRADE-related or sponsored events, whether or not on E*TRADE’s premises. You
should contact the Human Resources Department with any questions concerning such
policies. The E*TRADE Substance Abuse policy is posted on My Channel*E:
https://mychannele.corp.etradegrp.com/web/life/policy/substance.

 

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LOGO [g283628ex10_3pg23.jpg]

Non-Discrimination and Anti-Harassment Policy

E*TRADE promotes equal employment opportunity for all employees in connection
with selection, training, development, promotion, transfer, demotion,
discipline, compensation and termination of employees. E*TRADE is committed to
providing a workplace that is free of sexual or other harassment.

Equal Employment Opportunities

It is the policy of E*TRADE to ensure equal employment opportunity without
discrimination or harassment because of race, color, national origin, religion,
sex, age, disability, citizenship, marital status, sexual orientation, military
status, belief, ethnic origin, gender reassignment, pregnancy, nationality or
any other characteristic protected by applicable law. E*TRADE is committed to a
work environment in which all individuals are treated with respect and dignity.
Each individual should have the ability to work in a professional atmosphere
that promotes equal employment opportunities and prohibits discriminatory
practices, including harassment.

E*TRADE expects that all relationships among persons in the workplace be
businesslike and free of bias, prejudice and harassment. E*TRADE’s Equal
Employment Opportunities Policy is posted on My Channel*E:
https://mychannele.corp.etradegrp.com/web/life/policy/equal. If you have any
questions regarding this policy, please contact the Human Resources Department.

Discrimination and Harassment Are Against E*TRADE Policy and Are Illegal

E*TRADE prohibits, and will not tolerate, any discrimination or harassment,
whether committed by any employee, temporary agency employee, vendor, contractor
or guest. In addition, U.S. law and the laws of most U.S. states and
jurisdictions outside the U.S. prohibit discrimination and harassment. Conduct
prohibited by E*TRADE’s policy, as set forth herein, or under the law is
unacceptable in the workplace and in any work-related setting outside the
workplace, such as during business trips, business meetings and social events
related to E*TRADE’s business. E*TRADE’s unlawful harassment policy is posted on
My Channel*E: https://mychannele.corp.etradegrp.com/web/life/policy/harassment.

 

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Workplace Violence Is Prohibited

E*TRADE also is committed to providing its employees with a work environment
that is free of threats, intimidation and violence. E*TRADE expressly forbids
any such behavior or the possession of firearms or any other weapons when
conducting E*TRADE business, whether on or off E*TRADE’s premises. Further
guidance on determining what conduct or behavior is inappropriate and in
violation of E*TRADE policy, is available by contacting the Human Resources
Department, Corporate Security and Fraud Management or the Legal Department and
on My Channel*E at the following link
https://mychannele.corp.etradegrp.com/web/life/policy/prohibited.

Retaliation Is Prohibited

E*TRADE prohibits retaliation against any individual who, in good faith, reports
any violation of law, the Code or E*TRADE’s other policies and procedures,
including those prohibiting violence, discrimination, harassment, or concerns
about affirmative action; or any individual who participates in, or otherwise
supports, an investigation of such reports. Anyone who retaliates or suggests
others retaliate against an individual under such circumstances will be subject
to disciplinary action, up to and including termination of employment. E*TRADE’s
Unlawful Harassment Policy outlines the retaliation prohibition and is available
at https://mychannele.corp.etradegrp.com/web/life/policy/harassment.

Individuals Covered

E*TRADE’s anti-discrimination and anti-harassment policies apply to all
applicants and employees and prohibit harassment, discrimination, violence and
retaliation whether engaged in by fellow employees, a supervisor or a manager.
Persons not directly connected to E*TRADE (for example, outside vendors,
consultants, or customers) also are expected to comply with these policies in
all respects.

Reporting an Incident

You are strongly urged to report to your supervisor all incidents of
discrimination, harassment, violence or retaliation, regardless of the
offender’s identity or position, so that effective remedial action can be taken
as appropriate. If an incident involves your manager, supervisor or any other
member of management, you may make your report directly to the Human Resources
Department, the Legal Department or the Internal Audit Department. You may make
a report orally or in writing.

In addition, you may report any potential violation or incident anonymously
through ListenUp, an independent third-party service that E*TRADE has retained.
Instructions for submitting reports through ListenUp are available on My
Channel*E or you may access the site directly at www.listenupreports.com.

Investigation of Allegations

E*TRADE will promptly investigate all reported allegations of discrimination,
harassment, violence or retaliation and will take appropriate corrective action.

 

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Consequences of Inappropriate Behavior

Misconduct, including harassment, discrimination, violence, retaliation, any act
of moral turpitude or any other form of unprofessional, illegal or criminal
behavior, may subject you to disciplinary action by E*TRADE, up to and including
immediate termination. In addition, unlawful conduct may subject you to civil,
and in some cases criminal, liability.

 

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Handling Proprietary and Confidential Information

HandlingProprietary and Confidential information in the appropriate manner
safeguards E*TRADE’s assets and ensures compliance with regulations.

“Proprietary information” is E*TRADE information not known to the public that
may have intrinsic value or that may provide E*TRADE with a competitive
advantage. Proprietary information also includes the information derived from
public sources but which becomes proprietary through E*TRADE’s aggregation or
interpretation of that information. Proprietary information may be present in
various media and forms and includes information such as customer (for example,
customer lists) and employee information.

“Confidential information” is information that is not generally known to the
public about E*TRADE, its customers, its counterparties or other parties with
which E*TRADE has a relationship. Use of Confidential information must adhere to
applicable legal requirements and E*TRADE policies and procedures. Like
Proprietary information, Confidential information may be present in various
media and forms. The same information can be both confidential and proprietary.

Employees must use Proprietary or Confidential information solely to perform
your duties for E*TRADE and not for their own personal benefit. Confidential
information learned from one customer cannot be used for any other purpose or
for any other customer.

Safeguarding Materials Containing Proprietary or Confidential Information

Do not display, review or discuss Proprietary or Confidential information in
public places. Proprietary or Confidential information in physical form,
including on electronic media such as a diskette, should not be left unattended
unless it is secured behind a locked door or in locked office furniture.

Information stored in computers, including smart phones, personal digital
assistants, laptops and workstations must be protected by passwords, encryption
or other mechanisms that ensure only authorized individuals can access the
information. Documents containing Confidential or Proprietary information should
never be left in a public place and, whenever possible, should be marked
“E*TRADE Confidential” and/or “E*TRADE Proprietary.”

Do not remove Proprietary or Confidential information from E*TRADE premises
unless absolutely necessary to perform employee job functions for E*TRADE.
E*TRADE reserves the right to deny you permission to remove any Proprietary and
Confidential information from E*TRADE premises. If an

 

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employee takes such information out of the office for business purposes, keep it
on your person or in a secure place at all times and return it promptly to
E*TRADE premises.

Communicating Proprietary or Confidential Information

Exercise care when sending or discussing data containing Proprietary or
Confidential information on voicemail, electronic mail or other electronic
messaging, mobile or cordless phones, fax machines or message services. Make
sure you use correct electronic mail addresses, telephone extension numbers, fax
numbers and, when applicable, use project and code names.

Within E*TRADE, communicate Proprietary or Confidential information only to
employees who have a legitimate business reason to know the information and who
have no responsibilities or duties that could give rise to a conflict of
interest.

Do not disclose Proprietary or Confidential information to any person outside
E*TRADE (including family members), or use it or permit any third party to use
it without first obtaining approval from Legal.

Disposal of Proprietary or Confidential Waste

When no longer of use, Proprietary or Confidential information must be disposed
of in a manner that renders it unreadable and non-reconstructable, using means
and methods approved by E*TRADE (for example, approved shredders or confidential
waste bins), consistent with E*TRADE’s records management and information
security policies, applicable law and any applicable contractual obligations.
Information contained on electronic storage media (for example, a zip cartridge)
should be destroyed in a manner that renders it unreadable and unrecoverable.

Proprietary or Confidential Information Concerning Securities

When Proprietary or Confidential information might affect the price of a
security or other financial instrument, or the decision to buy or sell
securities or other financial instruments, the laws concerning insider trading
also govern your responsibilities, regardless of whether you are given specific
instructions or reminders that particular information may be “inside”
information. E*TRADE has developed strict procedures to ensure compliance with
the laws of each jurisdiction in which it does business. These procedures are
critical to the protection of the E*TRADE franchise and are described in
E*TRADE’s policy on the “Treatment of Inside Information,” which is outlined in
a subsequent section of this Code. Remember that these restrictions apply to
information relating to the stock of third parties as well as to E*TRADE stock.

Ownership of Intellectual Property

E*TRADE owns all rights in any intellectual property developed by you during
your employment that relate to E*TRADE’s business, even if invented or otherwise
developed outside E*TRADE premises and even if no E*TRADE equipment was used in
the process. For this purpose, E*TRADE’s intellectual property includes any
invention or design (whether or not patentable or reduced to practice) and all
related patents and patent applications, any copyrightable work, any trademarks
or service marks (and related registrations or applications for registration)
and any trade secrets. Some E*TRADE intellectual property is Proprietary
information that should be treated in accordance with the standards set forth in
this Code.

 

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Preventing Improper Use of Proprietary or Confidential Information

Employees should report violations or suspected violations of this policy or the
policy of any specific business unit or department to your supervisor,
Information Technology, the Legal Department and, if appropriate, Corporate
Information Security and Fraud Management.

 

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Treatment of Inside Information

Inside information is Proprietary or Confidential information about a securities
issuer that is subject to special E*TRADE policies.

POLICY ON THE TREATMENT OF INSIDE INFORMATION

Definition of Inside Information

“Inside information” (also called material non-public or price-sensitive
information) is defined under federal, state and other jurisdictional laws as
non-public information about a securities issuer (e.g., a public company) that
may have an impact on the price of a security or other financial instrument or
that a reasonable investor would be likely to consider important in making an
investment decision. Inside information may include but is not limited to, the
following:

 

•  

financial or business information (for example, non-public company earnings
information or estimates, dividend increases or decreases, liquidity problems or
changed projections);

 

•  

operating developments (for example, new product developments, changes in
business operations or extraordinary management developments or large increases
or decreases in orders); or

 

•  

proposed corporate transactions or reorganizations (for example, proposed or
agreed mergers, acquisitions, divestitures, major investments or
restructurings).

Consider all facts and circumstances in determining whether an item is Inside
information. Contact the Legal or Compliance Department if you have any
questions as to whether an item is, or may be, Inside information.

Prohibited Uses of Inside Information

As an E*TRADE employee, you may not trade, encourage others (including family,
friends, co-workers or any others) to trade, or recommend securities or other
financial instruments based on Inside information. In most jurisdictions,
securities laws require those with Inside information about a securities issuer
to refrain from disclosing such information to others and to desist from trading
in or recommending the purchase or sale of securities or other financial
instruments based upon such information. It is a violation of E*TRADE policy
and, in certain instances, the law, for insiders to communicate Inside
information to others, and it is

 

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a violation of policy and the law for the person who receives a “tip” to
disclose such information to others or to trade in or recommend securities or
other financial instruments based on the Inside information.

Guidelines for Information about E*TRADE

Publicly disclosed information about E*TRADE must be accurate and not
misleading. Do not discuss any Inside information about E*TRADE’s business
outside E*TRADE. Refer all stockholder or securities analyst inquiries to the
Investor Relations Department.

Handling Rumors

You may be violating the law if you trade based on a rumor. If you believe that
a rumor or piece of unsubstantiated information may have been circulated
deliberately, potentially to influence the market for securities or other
financial instruments of a publicly traded company, you must report the
situation promptly to the Legal, Risk Management and Compliance Departments. Do
not trade based on rumors or take any other action without the prior approval of
the Legal and Compliance Departments.

Consequences of Misusing Inside Information

The misuse of Inside information may result in, among other things, regulatory
inquiry, litigation, adverse publicity for E*TRADE (and you) and disciplinary
action by E*TRADE, up to and including termination of your employment. Misusing
Inside information may also end your career in the securities industry and
result in civil and criminal penalties, including incarceration.

The Restricted List

E*TRADE maintains a list of trading restrictions for certain types of securities
(the “Restricted List”). Employees and officers are not permitted to trade in
the securities (or other instruments) of issues on the Restricted List except in
accordance with any guidelines set forth on the Restricted List. Additional
detail regarding the Restricted List is provided in Section 7 of this Code and
on My Channel*E at
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/restricted.

 

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Outside Business Activities

Laws and regulations restrict your ability to become an officer, director or
employee of a company not affiliated with E*TRADE or to engage in certain
outside business activities.

Before engaging in an outside business activity, all employees must obtain
written approval in accordance with E*TRADE’s outside business activities
policies, which are posted on My Channel*E. Failure to obtain such approval may
subject E*TRADE and you to severe regulatory penalties and civil liability.
Employees may also be subject to disciplinary action, up to and including
termination of employment.

Even if an outside activity has been approved, employees may not engage in that
activity during working hours at E*TRADE nor use E*TRADE facilities to further
those outside activities except in accordance with E*TRADE’s policies.
Employees’ participation in an outside activity must not interfere with your
duties at E*TRADE. Please note, that activities on behalf of regulators,
regulatory advisory groups and industry-related trade associations are not
included in this prohibition. Additional information regarding outside business
activities is available on My Channel*E at
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/surveillance/associate

Members of the E*TRADE Financial Corporation Board of Directors must adhere to
the Corporate Governance Guidelines including seeking approval of such committee
to engage in certain business activities.

Outside Directorships, Industry-Related Organizations, Residential Boards and
Charities

All employees are required to request approval for directorships or equivalent
leadership positions in industry-related organizations, such as trade
associations. E*TRADE generally will not grant approval of outside business
activities with another financial services firm, including, but not limited to,
broker-dealers, banks, mortgage dealers and non-affiliated investment advisers.
You are required to obtain approval to become a director or officer of a
residential cooperative or condominium board or charitable organization.
Approval will depend upon the nature of your responsibilities at E*TRADE and
whether you will be compensated by, or render investment advice to, the board.
Consult the Legal and Compliance Departments for further information.

Members of E*TRADE Financial Corporation’s Board of Directors must adhere to the
Corporate Governance Guidelines and are requested to advise the Corporate
Secretary prior to accepting an appointment to a board of directors or advisory
board of financial institutions or other regulated organizations or companies.

 

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Employee Trading

The Employee Trading Policy is designed to prevent legal, business and ethical
conflicts and to guard against the misuse of Proprietary or Confidential
information.

All of your securities trading activities must strictly comply with all federal,
state and other jurisdictional laws, rules and regulations and must be in
accordance with the very highest ethical standards. You must not engage in
trading that is or may appear to be improper. You may not engage in personal
trading on a scale or of a kind that would distract you from your daily
responsibilities. The policy described below reflects these governing
principles.

E*TRADE Employee Trading Policies and Practices

E*TRADE maintains a number of policies and procedures that govern employee
trading in order to ensure compliance with numerous laws, regulations and rules.
Accordingly, employees are required to comply with these policies and
procedures. In addition, E*TRADE monitors employee trading activity and
maintains records of such activities, as required by applicable law. E*TRADE’s
key policy in this area is the Employee Trading Policy, which applies to all
E*TRADE employees and can be accessed on My Channel*E at
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/surveillance/associate

The Employee Trading Policy addresses the trading policies of all E*TRADE
business units; sets forth the types of accounts covered by policy; details the
requirement that employees maintain all trading accounts at E*TRADE; and also
covers trading in E*TRADE stock and restrictions on engaging in outside business
activities. Employees are required to review, understand and adhere to the
restrictions and requirements set forth in that policy, as well as in this Code.
Employees must also be familiar with and abide by any trading policies
applicable to your business unit or department because those policies may
contain restrictions beyond those imposed by this policy.

In addition, as set forth in the Employee Trading Policy, E*TRADE promotes wise
investment and long-term financial planning for both customers and employees. We
strongly discourage employees from engaging in excessive or inappropriate
trading that may interfere with an employee’s job performance or conflict with
principles of financial responsibility and long term investment strategies. For
a detailed description of the trading policy, please refer to the Employee
Trading Policy found in the above-referenced link.

In certain circumstances, as either an officer or employee of E*TRADE, you may
be deemed to have a “fiduciary” duty that requires you to conduct your personal
trading affairs in a manner that first benefits

 

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the investment objectives of customers. This conduct includes the timing of
personal securities transactions. You should never conduct personal trades at
the same time or in advance of transactions in the same security when you know
that similar transactions are being planned by customers or their advisors. For
additional information regarding this policy contact the Compliance Department.

The Restricted List

The Restricted List, which is also discussed earlier in the Treatment of Outside
Information section of this Code, is maintained by the Compliance Department.
The Restricted List is one of the tools E*TRADE uses to monitor and ensure that
regulatory requirements are met. Employees are not permitted to trade in the
securities (or other instruments) of issues on the Restricted List except in
accordance with any guidelines set forth on the Restricted List. Consult the
Compliance Department when questions arise or when you believe an exception is
warranted. If employees become aware of a violation, notify the Compliance
Department as soon as practicable, and in no event later than 24 hours following
becoming aware of the violation. Corrective action should not be taken without
Compliance Department approval.

A company may be on the Restricted List for many reasons. Therefore, employees
should not make any assumptions as to why an issuer has been listed. Similarly,
a company may not be on the Restricted List even though you (and others) may be
in possession of material non-public information about the company. The fact
that a company is not on the Restricted List does not in any way convey
permission or approval to trade on Inside Information. The Restricted List
regularly changes, so employees should consult the list before trading.

The Restricted List constitutes Proprietary and Confidential information.
Employees may not distribute the Restricted List, or any portion thereof,
outside E*TRADE. If employees have a joint account or an account in your name
that is managed by another pursuant to a power of attorney, it is the employee’s
responsibility to ensure that no trades of securities on the Restricted List are
made in these accounts. It is always an employee’s responsibility to avoid
trading on any Inside information. Additional detail regarding the Restricted
List is provided on My Channel*E at
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/restricted.

Transactions in E*TRADE’s Securities

E*TRADE has specific rules, as set forth below, that govern your transactions in
E*TRADE’s securities. You must follow these specific rules:

 

•  

The window period for transactions in E*TRADE’s securities generally begins or
“opens” at the close of market on the second business day following E*TRADE’s
earnings announcement and ends at the close of market on the 15th of the last
month (or, if the 15th is not a market day, the preceding market day) of each
fiscal quarter. However, circumstances relating to E*TRADE’s operations or plans
may cause E*TRADE to close the trading window at any time, with or without any
prior notice.

 

•  

Even during an open-window period, you may not transact in any of E*TRADE’s
securities if you have Inside information about E*TRADE, and any questions you
have about whether a proposed transaction is appropriate must be resolved by
seeking guidance from the Legal and Compliance Departments.

 

•  

You are not permitted to sell short or trade in derivatives involving any
E*TRADE securities.

 

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•  

E*TRADE’s securities are non-marginable for employees (including officers) or
board members.

Additional detail regarding E*TRADE policies and procedures applicable to
trading is available on My Channel*E at
https://mychannele.corp.etradegrp.com/web/guest/departments/brokeragecompliance/surveillance/associate

 

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ACKNOWLEDGEMENT

I hereby acknowledge that I have received a copy of the E*TRADE Code of
Professional Conduct (the “Code”) and that I have reviewed the contents of the
Code and all policies referenced therein.

I understand that I am responsible for complying with all laws and regulations
applicable to our business and all provisions of the Code, as well as all other
corporate policies and procedures, applicable to me as an employee, officer or
director.

After reviewing the Code, if I realize there are any provisions with which I
have not complied (for example, maintaining a brokerage or trading account with
an outside broker without prior approval or participating in an investment club
or serving on the board of directors of an outside entity without prior
approval), I will promptly notify the appropriate E*TRADE department.

I understand that if I have any questions about the application of the Code in
any situation, I should immediately seek guidance from the Legal Department.

 

Dated:  

 

   

 

      Signature Title:  

 

   

 

 

      Name Printed

 

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