SEQUOIA FUND, INC.
CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND
SENIOR FINANCIAL OFFICERS
I. Covered Officers/Purpose of the Code
This code of ethics (the "Code") for Sequoia Fund, Inc. (the "Fund")
applies to the Fund's Principal Executive Officer, Principal Financial Officer
and any other officer serving similar functions (the "Covered Officers," each of
whom is set forth in Exhibit A) for the purpose of promoting:
o honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
o full, fair, accurate, timely and understandable disclosure in reports
and documents that the Fund files with, or submits to, the U.S.
Securities and Exchange Commission ("SEC") and in other public
communications made by the Fund;
o compliance with applicable laws and governmental rules and
regulations;
o the prompt internal reporting of violations of the Code to an
appropriate person or persons identified in the Code; and
o accountability for adherence to the Code.
Each Covered Officer should adhere to a high standard of business ethics
and should be sensitive to situations that may give rise to actual as well as
apparent conflicts of interest.
II. Covered Officers Should Handle Ethically Actual and Apparent Conflicts of
Interest
Overview. A "conflict of interest" occurs when a Covered Officer's private
interest interferes with the interests of, or his service to, the Fund. For
example, a conflict of interest would arise if a Covered Officer, or a member of
his family, receives improper personal benefits as a result of his position with
the Fund.
Certain conflicts of interest arise out of the relationships between
Covered Officers and the Fund and already are subject to conflict of interest
provisions in the Investment Company Act of 1940 (the "1940 Act") and the
Investment Advisers Act of 1940 ("Advisers Act"). For example, Covered Officers
may not individually engage in certain transactions (such as the purchase or
sale of securities or other property) with the Fund because of their status as
"affiliated persons" of the Fund. The Fund's and the investment adviser's
compliance programs and procedures are designed to prevent, or identify and
correct, violations of these provisions. This Code does not, and is not intended
to, repeat or replace these programs and procedures, and such conflicts fall
outside of the parameters of this Code.
Although typically not presenting an opportunity for improper personal
benefit, conflicts arise from, or as a result of, the contractual relationship
between the Fund and the investment adviser of which the Covered Officers are
also officers or employees. As a result, this Code recognizes that the Covered
Officers will, in the normal course of their duties (whether formally for the
Fund or for the adviser, or for both), be involved in establishing policies and
implementing decisions that will have different effects on the adviser and the
Fund. The participation of the Covered Officers in such activities is inherent
in the contractual relationship between the Fund and the adviser and is
consistent with the performance by the Covered Officers of their duties as
officers of the Fund. Thus, if performed in conformity with the provisions of
the 1940 Act and the Advisers Act, such activities will be deemed to have been
handled ethically. In addition, it is recognized by the Fund's Board of Managers
(the "Board") that the Covered Officers may also be officers or employees of one
or more other investment companies covered by this or other codes.
Other conflicts of interest are covered by the Code, even if such conflicts
of interest are not subject to provisions in the 1940 Act and the Advisers Act.
The following list provides examples of conflicts of interest under the Code,
but Covered Officers should keep in mind that these examples are not exhaustive.
The overarching principle is that the personal interest of a Covered Officer
should not be placed improperly before the interest of the Fund.
* * * *
Each Covered Officer must:
o not use his personal influence or personal relationships improperly to
influence investment decisions or financial reporting by the Fund
whereby the Covered Officer would benefit personally to the detriment
of the Fund;
o not cause the Fund to take action, or to fail to take action, for the
individual personal benefit of the Covered Officer rather than the
benefit the Fund;
o not use material non-public knowledge of portfolio transactions made
or contemplated for the Fund to trade personally or cause others to
trade personally in contemplation of the market effect of such
transactions;
o report at least annually any ownership interest in the Fund or its
adviser.
There are some conflict of interest situations that should always be
discussed with the [Compliance Officer], if material. Examples of these include:
o service as a director on the board of any public or private company;
o the receipt of any gifts other than ones of de minimis value;
o the receipt of any entertainment from any company with which the Fund
has current or prospective business dealings unless such entertainment
is business-related, reasonable in cost, appropriate as to time and
place, and not so frequent as to raise any question of impropriety;
o any ownership interest in, or any consulting or employment
relationship with, any of the Fund's service providers, other than its
investment adviser, principal underwriter, if any, administrator or
any affiliated person thereof;
o a direct or indirect financial interest in commissions, transaction
charges or spreads paid by the Fund for effecting portfolio
transactions or for selling or redeeming shares other than an interest
arising from the Covered Officer's employment, such as compensation or
equity ownership.
III. Disclosure and Compliance
o Each Covered Officer should familiarize himself with the disclosure
requirements generally applicable to the Fund.
o Each Covered Officer should not knowingly misrepresent, or cause
others to misrepresent, facts about the Fund to others, whether within
or outside the Fund, including to the Fund's directors and auditors,
and to governmental regulators and self-regulatory organizations.
o Each Covered Officer should, to the extent appropriate within his area
of responsibility, consult with other officers and employees of the
Fund and the adviser with the goal of promoting full, fair, accurate,
timely and understandable disclosure in the reports and documents the
Fund files with, or submits to, the SEC and in other public
communications made by the Fund.
o It is the responsibility of each Covered Officer to promote compliance
with the standards and restrictions imposed by applicable laws, rules
and regulations.
IV. Reporting and Accountability
Each Covered Officer must:
o upon adoption of the Code (or thereafter as applicable, upon becoming
a Covered Officer), affirm in writing to the Board that he has
received, read, and understands the Code;
o annually thereafter affirm to the Board that he has complied with the
requirements of the Code;
o not retaliate against any other Covered Officer or any employee of the
Fund or its affiliated persons for reports of potential violations
that are made in good faith; and
o notify the [Compliance Officer] promptly if he knows of any violation
of this Code. Failure to do so is itself a violation of this Code.
The [Compliance Officer] is responsible for applying this Code to specific
situations in which questions are presented under it and has the authority to
interpret this Code in any particular situation.(1) However, any approvals or
waivers(2) sought by the Principal Executive Officer will be considered by the
Board.
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1 The Compliance Officer is authorized to consult, as appropriate, with the
Board and counsel to the Fund, and is encouraged to do so.
2 Item 2 of Form N-CSR defines "waiver" as "the approval by the registrant of
a material departure from a provision of the code of ethics" and "implicit
waiver," which must also be disclosed, as "the registrant's failure to take
action within a reasonable period of time regarding a material departure
from a provision of the code of ethics that has been made known to an
executive officer" of the registrant.
The Fund will follow these procedures in investigating and enforcing this
Code:
o The [Compliance Officer] will take all appropriate action to
investigate any potential violations reported to him;
o if, after such investigation, the [Compliance Officer] believes that
no violation has occurred, the [Compliance Officer] is not required to
take any further action;
o any matter that the [Compliance Officer] believes is a violation will
be reported to the Board;
o if the Board concurs that a violation has occurred, it will consider
appropriate action, which may include: (i) review of, and appropriate
modifications to, applicable policies and procedures; (ii)
notification to appropriate personnel of the investment adviser or its
board; or (iii) a recommendation to dismiss the Covered Officer;
o the Board will be responsible for granting waivers, as appropriate;
and
o any changes to or waivers of this Code will, to the extent required,
be disclosed as provided by SEC rules.
V. Other Policies and Procedures
This Code shall be the sole code of ethics adopted by the Fund for purposes
of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to
registered investment companies thereunder. If other policies or procedures of
the Fund, the Fund's adviser or other service providers that govern or purport
to govern the behavior or activities of the Covered Officers who are subject to
this Code overlap or conflict with the provisions of this Code, the [Compliance
Officer] will determine whether the provisions of this Code or such other policy
or procedure will apply. The Fund's and its investment adviser's codes of ethics
under Rule 17j-1 under the 1940 Act are separate requirements applying to the
Covered Officers and others, and are not part of this Code.
VI. Amendments
Any amendments to this Code, other than amendments to Exhibit A, must be
approved or ratified by a majority vote of the Board, including a majority of
independent directors.
VII. Confidentiality
All reports and records prepared or maintained pursuant to this Code will
be considered confidential and shall be maintained and protected accordingly.
Except as otherwise required by law or this Code, such matters shall not be
disclosed to anyone other than the Fund and its adviser.
VIII. Internal Use
The Code is intended solely for the internal use by the Fund and does not
constitute an admission, by or on behalf of the Fund, as to any fact,
circumstance, or legal conclusion.
Adopted: September 8, 2003
Exhibit A
Persons Covered by this Code of Ethics:
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Richard T. Cunniff Vice Chairman
Robert D. Goldfarb President
David M. Poppe Executive Vice President
Joseph Quinones, Jr. Vice President, Secretary & Treasurer\CCO
Michael Valenti Assistant Secretary