CODE
OF CONDUCT
FOR
DIRECTORS AND
EMPLOYEES
OF
HARRIS
& HARRIS GROUP, INC.
Harris
& Harris Group, Inc. (the "Company") is
committed to conducting business in accordance with applicable laws, rules and
regulations and the highest standards of business ethics, and to full and
accurate disclosure -- financial and otherwise -- in compliance with applicable
law. This Code of Conduct, which is applicable to the Company's Chief
Executive Officer, President, Chief Financial Officer and Treasurer (or persons
performing similar functions) (together, "Senior Officers"),
the Company's Board of Directors (the "Board") and all other
employees (collectively, "Covered Persons"),
sets forth policies to guide you in the performance of your duties.
As a
Covered Person, you must comply with applicable law. You also have a
responsibility to conduct yourself in an honest and ethical
manner. The Senior Officers also have leadership responsibilities
that include creating a culture of high ethical standards and a commitment to
compliance, maintaining a work environment that encourages the internal
reporting of compliance concerns and promptly addressing compliance
concerns.
This Code
of Conduct recognizes that certain laws and regulations applicable to, and
certain policies and procedures adopted by, the Company govern your conduct in
connection with many of the conflict of interest situations that may arise in
connection with the operations of the Company, including:
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the
Investment Company Act of 1940, and the rules and regulations promulgated
thereunder by the Securities and Exchange Commission (the "1940 Act");
and
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the
Code of Ethics Pursuant to Rule 17j-1 under the 1940 Act (collectively,
the "Company's
1940 Act Code of Ethics").
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The
provisions of the 1940 Act and the 1940 Act Codes of Ethics are referred to
herein collectively as the "Additional Conflict
Rules."
This Code
of Conduct is different from, and is intended to supplement, the Additional
Conflict Rules. Accordingly, a violation of the Additional Conflict
Rules by a Covered Person is hereby deemed not to be a violation of this Code of
Conduct, unless and until the Board shall determine that any such violation of
the Additional Conflict Rules is also a violation of this Code of
Conduct.
Covered
Persons Should Act Honestly and Candidly
Each
Covered Person has a responsibility to the Company to act with
integrity. Integrity requires, among other things, being honest and
candid. Deceit and subordination of principle are inconsistent with
integrity.
Each
Covered Person must:
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act
with integrity, including being honest and candid while still maintaining
the confidentiality of information where required by law or the Additional
Conflict Rules;
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comply
with the laws, rules and regulations that govern the conduct of the
Company's operations and report any suspected violations thereof in
accordance with the section below entitled "Compliance With Code Of
Conduct"; and
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adhere
to a high standard of business
ethics.
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Conflicts
Of Interest
A
conflict of interest for the purpose of this Code of Conduct occurs when your
private interests interfere in any way, or even appear to interfere, with the
interests of the Company.
Covered
Persons are expected to use objective and unbiased standards when making
decisions that affect the Company. You are required to conduct the
business of the Company in an honest and ethical manner, including the ethical
handling of actual or apparent conflicts of interest between personal and
business relationships. When making any investment, accepting any
position or benefits, participating in any transaction or business arrangement
or otherwise acting in a manner that creates or appears to create a conflict of
interest with respect to the Company where you are receiving a personal benefit,
you should act in accordance with the letter and spirit of this Code of
Conduct.
If you
are in doubt as to the application or interpretation of this Code of Conduct to
you as a Covered Person of the Company, you should make full disclosure of all
relevant facts and circumstances to the Chief Compliance Officer and obtain his
or her approval prior to taking action. In material situations, the
Chief Compliance Officer should consult with the Chair of the Audit Committee if
practicable prior to making a determination.
Some
conflict of interest situations that should always be approved include the
following:
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the
receipt of any entertainment or non-nominal gift by the Covered Person, or
a member of his or her immediate family, from any company with which the
Company has current or prospective business dealings, unless such
entertainment or gift is business related, reasonable in cost, appropriate
as to time and place, and not so frequent as to raise any question of
impropriety;
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any
ownership interest in, or any consulting or employment relationship with,
any of the Company's service providers;
or
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a
direct or indirect financial interest based upon or varying with the level
of commissions, transaction charges or spreads paid by the Company for
effecting portfolio transactions or for selling or repurchasing
shares.
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Disclosures
It is the
policy of the Company to make full, fair, accurate, timely and understandable
disclosure in compliance with all applicable laws and regulations in all reports
and documents that the Company files with, or submits to, the Securities and Exchange Commission or a
national securities exchange, and in all other public communications made
by the Company. As a Covered Person, you are required to promote
compliance with this policy and to abide by the Company's standards, policies
and procedures designed to promote compliance with this policy.
Each
Covered Person must not knowingly misrepresent, or cause others to misrepresent,
facts about the Company to others, including to the Board members, the Company's
independent auditors, the Company's counsel, governmental regulators or
self-regulatory organizations.
Each
Senior Officer must familiarize himself or herself with the disclosure
requirements applicable to the Company and its policies in that regard as well
as the business and financial operations of the Company.
Compliance
With Code Of Conduct
If you
know of or suspect a violation of this Code of Conduct or other laws,
regulations, policies or procedures applicable to the Company, you must report
that information on a timely basis to the Chief Compliance Officer or the Chair
of the Audit Committee or report it anonymously by following the "whistle
blower" policies adopted by the Company from time to time. No one will be subject to
retaliation because of a good faith report of a suspected
violation.
The
Company will follow these procedures in investigating and enforcing this Code of
Conduct, and in reporting on this Code of Conduct:
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the
Chief Compliance Officer or the Chair of the Audit Committee will take all
appropriate action to investigate any actual or potential violations
reported to him or her;
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violations
and potential violations by a Senior Officer and material violations by
other Covered Persons will be reported to the Board after such
investigation;
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if
the Chief Compliance Officer or Chair of the Audit Committee determines
that a violation has occurred, he or she will take all appropriate
disciplinary or preventive action, which shall follow review by the Board
in situations that are material;
and
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appropriate
disciplinary or preventive action may include a letter of censure,
reduction in compensation, damages, suspension, dismissal or, in the event
of criminal or other serious violations of law, notification of the
Securities and Exchange Commission or other appropriate law enforcement
authorities.
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Waivers
Of Code Of Conduct
Except as
otherwise provided in this Code of Conduct, the Chief Compliance Officer is
responsible for applying this Code of Conduct to specific situations in which
questions are presented and has the authority to interpret this Code of Conduct
in any particular situation. Such responsibility is shared with the
Chair of the Audit Committee. One or both such persons shall take all
action he or she considers appropriate to investigate any actual or potential
violations reported under this Code of Conduct.
The Chief
Compliance Officer and the Chair of the Audit Committee are authorized to
consult, as appropriate, with the Independent Directors, other members of
management and with counsel.
The Board
is responsible for granting waivers of this Code of Conduct with respect to
Senior Officers. Any changes to or waivers for Senior Officers of
this Code of Conduct will, to the extent required, be disclosed on Form 10-K, or
otherwise, as provided by Securities and Exchange Commission rules.
Recordkeeping
The
Company will maintain and preserve for a period of not less than six (6) years
from the date an action is taken, the first two (2) years in an easily
accessible place, a copy of the information or materials supplied to the
Board:
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that
provided the basis for any amendment to or waiver for a Senior Officer of
this Code of Conduct; and
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relating
to any violation of this Code of Conduct and sanctions imposed for such
violation, together with a written record of the approval or action taken
by the Chair of the Audit Committee or the
Board.
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Confidentiality
All
reports and records prepared or maintained pursuant to this Code of Conduct
shall be considered confidential and shall be maintained and protected
accordingly. Except as otherwise required by law or this Code of
Conduct, such matters shall not be disclosed to anyone other than the Company
and its counsel and any other advisors, consultants or counsel retained by the
Board or any committee of the Board.
Amendments
This Code
of Conduct may not be amended except in written form, which is specifically
approved by a majority vote of the Board, including a majority of the
Independent Directors.
No
Rights Created
This Code
of Conduct is a statement of certain fundamental principles, policies and
procedures that govern each of the Covered Persons in the conduct of the
Company's business. It is not intended to and does not create any
rights in any employee, investor, supplier, competitor, shareholder or any other
person or entity.
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Adopted
May 2004
Revised
September 2004
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ACKNOWLEDGEMENT
FORM
I have
received and read the Code of Conduct for Directors and Employees, and I
understand its contents. I agree to comply fully with the standards
contained in the Code of Conduct and the Company's related policies and
procedures . I understand that I have an obligation to report any
suspected violations of the Code of Conduct on a timely basis to the Chair of
the Audit Committee or report it anonymously by following the "whistleblower"
policies adopted by the Company from time to time.
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______________________________________
Printed
Name
______________________________________
Signature
______________________________________
Date
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