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EXHIBIT 2(r)
NBT INVESTMENT COMPANY, INC.
CODE OF ETHICS
A. Legal Requirements.
Rule 17j-1(b) under the Investment Company Act of 1940 (the
"Act") makes it unlawful for any officer or director (as well as other persons)
of NBT Investment Company, Inc. (the "Fund"), in connection with the purchase or
sale(1) by such person of a security "held or to be acquired" by the Fund:
(1) To employ any device, scheme or artifice to defraud the
Fund;
(2) To make to the Fund any untrue statement of a material
fact or omit to state to the Fund a material fact necessary in order to
make the statements made, in light of the circumstances under which
they are made, not misleading;
(3) To engage in any act, practice, or course of business
which operates or would operate as a fraud or deceit upon the Fund; or
(4) To engage in any manipulative practice with respect to the
Fund.
A security is "held or to be acquired" if it is a covered
security(2) (or an option for or exchangeable for a covered security)
and within the most recent 15 days (i) the covered security is or has
been held by the Fund, or (ii) the covered security is being or has
been considered by the Fund or the investment adviser for the Fund for
purchase by the Fund.
B. Fund Policies.
1. It is the policy of the Fund that no "access person"(3) of the Fund
shall engage in any act, practice or course or conduct that would violate the
provisions of Rule 17j-1(b) set forth above.
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(1) A purchase or sale includes the writing of an option to purchase or
sell.
(2) A "covered security" is any security under the broad definition of
Section 2(a)(36) of the Act except: (i) direct obligations of the United States,
(ii) bankers' acceptances, bank CDs, commercial paper, high quality short-term
debt instruments (including repurchase agreements), and (iii) shares of open-end
investment companies.
(3) An "access person" is (i) each director or officer of the Fund,
(ii) each employee (if any) of the Fund who, in connection with his regular
duties, makes, participates in, or obtains information about the purchase or
sale of a security by and/or of the Fund or whose functions relate to the making
of any recommendations
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2. In keeping with the recommendations of the Board of Governors
of the Investment Company Institute, the following general policies shall govern
personal investment activities of access persons of the Fund:
(a) It is the duty of all access persons of the Fund to
place the interest of Fund shareholders first;
(b) All access persons of the Fund shall conduct personal
securities transactions in a manner that is consistent with this Code of Ethics
and that avoids any actual or potential conflict of interest or any abuse of a
position of trust and responsibility; and
(c) No access person of the Fund shall take inappropriate
advantage of his or her position with the Fund.
C. Reporting Requirements.(4)
In order to provide the Fund with information to enable it to
determine with reasonable assurance whether the Fund's policies are being
observed by its access persons:
(a) Each person becoming an access person of the Fund, other
than a director who is not an "interested person" of the Fund (as
defined in the Act), shall no later than 10 days after becoming such an
access person submit a report in the form attached hereto as Exhibit A
(an "Initial Holding Report") to the Fund's Compliance Officer showing
all holdings in "covered securities" in which the person had any direct
or indirect beneficial ownership.(5) Such Initial Holding Report shall
also indicate all broker/dealers and banks with which the access person
held direct or indirect ownership of securities. Such reports
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with respect to such purchases or sales, and (iii) any
natural person in a control relationship to the Fund who obtains information
concerning recommendations made to the Fund with regard to the purchase or sale
of covered securities.
(4) An access person of the Fund who is also an access person of the
Fund's investment adviser, sub-adviser or principal underwriter, if any, may
submit reports required by this Section to such investment adviser, sub-adviser
or principal underwriter in lieu of submitting reports under NBT Investment
Company, Inc.'s Code of Ethics provided that such forms contain substantially
the same information as called for in the forms required by this Section C and
comply with the requirements of Rule 17j-1(d)(1).
(5) "Beneficial ownership" of a security as used in this Section C is
determined in the same manner as it would be for the purposes of Section 16 of
the Securities Exchange Act of 1934, except that such determination should apply
to all covered securities. Generally, a person should consider himself the
beneficial owner of covered securities held by his spouse, his minor children, a
relative who shares his home, or other persons if by reason of any contract,
understanding, relationship, agreement or other arrangement, he obtains from
such covered securities benefits substantially equivalent to those of ownership.
He should also consider himself the beneficial owner of securities if he can
vest or revest title in himself now or in the future.
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need not show holdings over which such person had no direct or indirect
influence or control.
(b) Each access person of the Fund, other than a director who
is not an "interested person" of the Fund (as defined in the Act),
shall submit reports each quarter in the form attached hereto as
Exhibit B (a "Securities Transaction Report") to the Fund's Compliance
Officer showing all transactions in "covered securities" in which the
person had, or by reason of such transaction acquired, any direct or
indirect beneficial ownership. Such reports shall be filed no later
than 10 days after the end of each calendar quarter, but need not show
transactions over which such person had no direct or indirect influence
or control.
(c) Each director who is not an "interested person" of the
Fund (as defined in the Act) shall submit the same quarterly report as
required under paragraph (b), but only for a transaction in a covered
security where he knew at the time of the transaction or, in the
ordinary course of fulfilling his official duties as a director, should
have known that during the 15-day period immediately preceding or after
the date of the transaction such security is or was purchased or sold,
or considered for purchase or sale, by the Fund. Such report shall be
submitted to Legal Counsel for the Fund. No report is required if the
director had no direct or indirect influence or control over the
transaction.
(d) Each access person of the Fund, other than a director who
is not an "interested person" (as defined in the Act), shall by January
30 of each year submit to the Fund's Compliance Officer a report in the
form attached hereto as Exhibit A (an "Annual Holding Report") showing
all holdings in covered securities in which the person had any direct
or indirect beneficial ownership as of a date no more than 30 days
before the report is submitted. Such report need not show holdings over
which such person had no direct or indirect influence or control.
D. Preclearance Procedures.
Investment personnel of the Fund shall obtain approval from
the Fund's Compliance Officer before directly or indirectly acquiring beneficial
ownership in any securities in an initial public offering or in a limited
offering.(6)
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(6) "Investment personnel of the Fund" means (i) any employee of the
Fund (or of a company in a control relationship to the Fund) who, in connection
with his or her regular functions or duties, makes or participates in making
recommendations regarding the purchase or sale of securities by the Fund, and
(ii) any natural person who controls the Fund and who obtains information
concerning recommendations made to the Fund regarding the purchase or sale of
securities. "Initial public offering" and "limited offering" shall have the same
meaning as set forth in Rule 17j-1(a)(6) and (8), respectively.
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E. Notice to, and Review of, Holding Reports by Access Persons.
1. The Fund's Compliance Officer shall notify each access
person of the Fund who may be required to make reports pursuant to this Code
that such person is subject to this reporting requirement and shall deliver a
copy of this Code to each such person.
2. The Compliance Officer of the Fund or his or her delegate
or Legal Counsel for the Fund shall review reports submitted under Section C of
this Code within 21 days of submission.
3. The Compliance Officer of the Fund will establish and
maintain records of access persons of the Fund, other than directors who are not
an "interested persons" (as defined in the Act), who are required to make
reports under Section C of this Code and shall establish and maintain records of
any delegate responsible for reviewing such reports. Legal Counsel for the Fund
will establish and maintain records of directors who are not "interested
persons" (as defined in the Act) who are required to make reports under Section
C of this Code.
F. Reports to Directors.
1. The Fund's Compliance Officer or Legal Counsel for the Fund
shall report to the Board of Directors:
(a) at the next meeting following the receipt of any
Securities Transaction Report with respect to each reported transaction
in a security which was held or acquired by the Fund within 15 days
before or after the date of the reported transaction or at a time when,
to the knowledge of the Fund's Compliance Officer, Legal Counsel for
the Fund, the Fund, or the investment adviser for the Fund, was
considering the purchase or sale of such security, unless the amount
involved in the transaction was less than $50,000;
(b) with respect to any transaction or holding not required to
be reported to the Board by the operation of subparagraph (a) that the
Fund's Compliance Officer or Legal Counsel for the Fund believes
nonetheless may evidence a violation of this Code; and
(c) any apparent violation of the reporting requirements of
Section C of this Code.
2. The Board shall consider reports made to it hereunder and
shall determine whether the policies established in section B of this Code have
been violated, and what sanctions, if any, should be imposed.
G. Approval of Codes and Material Amendments Thereto.
1. The Board of Directors of the Fund, including a majority of
the independent Directors thereof, shall approve the Codes of Ethics of the Fund
and, if any, of the investment
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adviser to the Fund, of the sub-adviser to the Fund and of the principal
underwriter of the Fund. No investment adviser, sub-adviser or principal
underwriter of the Fund may be appointed unless and until the Code of Ethics of
that entity has been approved by the Board of Directors of the Fund, including a
majority of the independent Directors thereof. Following initial approval of the
Code of Ethics of the investment adviser to the Fund, the sub-adviser to the
Fund or the principal underwriter of the Fund, any material change to such Code
must be approved by the Board of Directors of the Fund, including a majority of
the independent Directors thereof, within six months of said amendment. No
amendment of this Code may be made unless and until approved by the Board of
Directors of the Fund, including a majority of the independent Directors
thereof.
2. In approving a Code of Ethics, the Board of Directors shall
have secured a certificate from the entity that adopted the Code that it has
adopted procedures reasonably necessary to prevent its access persons from
violating the Code in question.
H. Annual Report
The Fund and, if any, the principal underwriter thereof and
any investment adviser or sub-adviser to the Fund shall, not less frequently
than annually, furnish the Board of Directors of the Fund with a written report
that:
1. describes any issues arising under its Code of Ethics
or procedures since the last report to the Board of
Directors, including, but not limited to, information
about material violations of such Code or procedures
and sanctions imposed in response, and
2. certifies that the Fund, principal underwriter,
investment adviser or sub-adviser, as applicable, has
adopted procedures reasonably necessary to prevent
its access persons from violating its Code of Ethics.
This Code, a copy of each Securities Transaction and Holding
Report by an access person, any written report hereunder by the Fund's
Compliance Officer, any written report hereunder by the Legal Counsel for the
Fund, and lists of all persons required to make reports shall be preserved with
the Fund's records for the period required by Rule 17j-1.
Adopted: May 31, 2000
The Board of Directors
NBT Investment Company, Inc.
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Exhibit A
NBT Investment Company, Inc.
Holding Report
[ ] Initial Holding Report of , 200
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(date a reporting person became an access person)
[ ] Annual Holding Report as of , 200
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(date not more than 30 days prior to submission)
To the Compliance Officer of NBT Investment Company, Inc. or Legal Counsel for
NBT Investment Company, Inc.
As of the above date, I had direct or indirect beneficial ownership of
the following covered securities:
Principal
Number Amount of
Title of Shares Security
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As of that same date, I held direct or indirect beneficial ownership of
securities with the following broker/dealer(s) or bank(s):
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This report (i) excludes securities with respect to which I had no
direct or indirect influence or control, (ii) excludes securities not required
to be reported, and (iii) is not an admission that I have or had any direct or
indirect beneficial ownership in the securities listed above.
Date: Signature:
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Exhibit B
NBT Investment Company, Inc.
Securities Transaction Report
For the Calendar Quarter Ended: , 200
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To the Compliance Officer of NBT Investment Company, Inc. or Legal Counsel for
NBT Investment Company, Inc.:
During the quarter referred to above, the following transactions were
effected in securities of which I had, or by reason of such transaction
acquired, direct or indirect beneficial ownership, and which are required to be
reported pursuant to the Fund's Code of Ethics:
<TABLE>
<S> <C> <C> <C> <C> <C>
Title of Broker/
Security (and Dealer
interest rate No. of Shares and Nature of Price at or Bank
and maturity Principal Dollar Transaction Which Through
date, if Date of Amount of (Purchase, Transaction Whom
applicable) Transaction Transaction (Price) Sale, Other) Effected Effected
</TABLE>
During the quarter referred to above, I established the following
account in which securities were held for my direct or indirect benefit during
the quarter:
Broker/Dealer or
Bank With Whom Date the Account
Account Established Was Established
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This report (i) excludes transactions with respect to which I had no direct or
indirect influence or control, (ii) excludes transactions not required to be
reported, and (iii) is not an admission that I have or had any direct or
indirect beneficial ownership in the securities listed above.
Date: Signature:
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