SUMMIT MUTUAL FUNDS, INC.
CODE OF ETHICS
FOR
PRINCIPAL EXECUTIVE
AND
SENIOR FINANCIAL OFFICERS
I. COVERED OFFICERS/PURPOSE OF THE CODE
Summit Mutual Funds, Inc.'s code of ethics (this "Code") for the
investment companies within the complex (collectively, "Funds" and each,
"Company") applies to the Company's principal Executive Officer, principal
financial officer, and principal accounting officer (the "Covered Officers",
each of whom are set forth in Exhibit A), for the purpose of promoting:
o Honest and ethical conduct, including 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 a registrant files with, or submits
to, the Securities and Exchange Commission ("SEC") and in
other public communications made by the Company;
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 apparent as
well as actual 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
Company. 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 Company.
Certain conflicts of interest arise out of the relationships between
Covered Officers and the Company and already are subject to conflict of interest
provisions in the Investment Company Act of 1940 ("Investment Company Act") and
the Investment Advisers Act of 1940 ("Investment 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 Company because
of their status as "affiliated persons" of the Company. The Company'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 Company 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
Company 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 Company. The participation of the Covered Officers in such activities is
inherent in the contractual relationship between the Company and the adviser and
is consistent with the performance by the Covered Officers of their duties as
officers of the Company. Thus, if performed in conformity with the provisions of
the Investment Company Act and the Investment Advisers Act, such activities will
be deemed to have been handled ethically. In addition, it is recognized by the
Funds' Boards of Directors ("Boards") 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 Investment Company
Act and the Investment 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 overriding principle is that the
personal interest of a Covered Officer should not be placed improperly before
the interest of the Company.
Each Covered Officer must:
o Not use his personal influence or personal relationships
improperly to influence investment decisions or financial
reporting by the Company whereby the Covered Officer would
benefit personally to the detriment of the Company;
o Not cause the Company to take action, or fail to take action,
for the individual personal benefit of the Covered Officer
rather than the benefit the Company;
o Not use material non-public knowledge of portfolio
transactions made or contemplated for the Company to trade
personally or cause others to trade personally in
contemplation of the market effect of such transactions;
There are some conflict of interest situations that should always be
discussed with the Company's in-house legal counsel ("Legal Counsel") 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 non-nominal gifts;
o The receipt of any entertainment from any company with which
the Company 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 Company's service providers,
other than its investment adviser, principal underwriter,
administrator or any affiliated person thereof;
o A direct or indirect financial interest in commissions,
transaction charges or spreads paid by the Company 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 Company;
o Each Covered Officer should not knowingly misrepresent, or
cause others to misrepresent, facts about the Company to
others, whether within or outside the Company, including to
the Company'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 Funds and the adviser with the goal of
promoting full, fair, accurate, timely and understandable
disclosure in the reports and documents the Funds file with,
or submit to, the SEC and in other public communications made
by the Funds; and
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 Annually report to the Legal Counsel affiliations or other
relationships related to conflicts of interest.
o Not retaliate against any other Covered Officer or any
employee of the Funds or their affiliated persons for reports
of potential violations that are made in good faith; and
o Notify the Legal Counsel promptly if he knows of any violation
of this Code. Failure to do so is itself a violation of this
Code.
The Legal Counsel 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. However, any approvals or
waivers sought by the Principal Executive Officer will be considered by the
Audit Committee (the "Committee").
The Funds will follow these procedures in investigating and enforcing
this Code:
o The Legal Counsel will take all appropriate action to
investigate any potential violations reported to him;
o If, after such investigation, the Legal Counsel believes that
no violation has occurred, he is not required to take any
further action;
o Any matter that the Legal Counsel believes is a violation will
be reported to the Committee;
o If the Committee concurs that a violation has occurred, it
will inform and make a recommendation to the Board, which will
consider appropriate action, which may include review of, and
appropriate modifications to, applicable policies and
procedures; notification to appropriate personnel of the
investment adviser or its board; or a recommendation to
dismiss the Covered Officer;
o The Committee 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.
A report on compliance with this Code will be presented at each regular
meeting of the Boards.
V. OTHER POLICIES AND PROCEDURES
This Code shall be the sole code of ethics adopted by the Funds for
purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms
applicable to registered investment companies thereunder. Insofar as other
policies or procedures of the Funds, the Funds' adviser, principal underwriter,
or other service providers govern or purport to govern the behavior or
activities of the Covered Officers who are subject to this Code, they are
superseded by this Code to the extent that they overlap or conflict with the
provisions of this Code. The Funds' and their investment adviser's codes of
ethics under Rule 17j- 1 under the Investment Company 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.
VIII. INTERNAL USE
The Code is intended solely for the internal use by the Funds and does
not constitute an admission, by or on behalf of any Company, as to any fact,
circumstance, or legal conclusion.
Date: August 11, 2003
EXHIBIT A
Persons covered by this Code of Ethics:
Steven R. Sutermeister
Thomas G. Knipper