OCM MUTUAL FUND
SARBANES-OXLEY
CODE OF ETHICS FOR THE PRINCIPAL EXECUTIVE OFFICER,
PRINCIPAL FINANCIAL OFFICER AND PRINCIPAL ACCOUNTING OFFICER
(ADOPTED AUGUST 7, 2003)
INTRODUCTION
OCM Mutual Fund (the "Fund") expects all of its officers to maintain high
ethical standards of conduct and to comply with applicable laws and governmental
regulations. Officers include, without limitation, the Fund's principal
executive officer, principal financial officer and principal accounting officer)
(the principal executive officer, principal financial officer and principal
accounting officer of the Fund are collectively referred to herein as the
"Senior Financial Officers"). (The Fund anticipates that most of the time the
Senior Financial Officers will consist of only one or two persons.) In this
regard, the Fund requires all of its officers, including the Senior Financial
Officers, to adhere to such other rules, codes and guidelines as the Fund may
adopt from time to time, including, without limitation, codes of ethics adopted
pursuant to Rule 17j-1 under the Investment Company Act of 1940 (collectively,
the "Fund Guidelines").
To deter wrongdoing and to promote honest and ethical conduct, compliance
with applicable laws and regulations, avoidance of conflicts of interest and
full, fair, accurate, timely and understandable disclosure in the Fund's public
filings and communications, the Fund has approved this Sarbanes-Oxley Code of
Ethics to codify certain standards to which the Senior Financial Officers will
be held accountable and certain specific duties and responsibilities applicable
to the Senior Financial Officers. As the professional and ethical conduct of the
Senior Financial Officers is essential to the proper conduct and success of the
Fund's business, the Senior Financial Officers must adhere to the standards,
duties and responsibilities set forth in this Sarbanes-Oxley Code of Ethics in
addition to adhering to the Fund Guidelines. To the fullest extent possible, the
Fund Guidelines and this Sarbanes-Oxley Code of Ethics should be read to
supplement one another. If there is a conflict between the Fund Guidelines and
this Sarbanes-Oxley Code of Ethics, then this Sarbanes-Oxley Code of Ethics will
control.
CODE OF ETHICS
General Standards
The Fund and the Fund's Board of Directors will hold each Senior Financial
Officer accountable for adhering to and advocating the following standards to
the best of his or her knowledge and ability:
A. Act in an honest and ethical manner, including in connection with
the handling and avoidance of actual or apparent conflicts of
interest between personal and professional relationships;
B. Comply with all applicable laws, rules and regulations of federal,
state and local governments (both United States and foreign) and
other applicable regulatory agencies (collectively, the "Laws");
C. Proactively promote full, fair, accurate, timely and understandable
disclosure in reports and documents that the Fund files with, or
submits to, the Securities and Exchange Commission (the "SEC") and
in other public communications the Fund makes; and
D. Proactively promote ethical and honest behavior within the Fund,
including, without limitation, the prompt reporting of violations
of, and being accountable for adherence to, this Sarbanes-Oxley Code
of Ethics.
Specific Duties and Responsibilities
In adhering to and advocating the standards set forth above, each Senior
Financial Officer shall fulfill the following duties and responsibilities to the
best of his or her knowledge and ability:
1. Each Senior Financial Officer shall handle all conflicts of interest
between his or her personal and professional relationships in an
ethical and honest manner, and shall disclose in advance to the
Audit Committee of the Fund's Board of Directors ("Audit Committee")
the relevant details of any transaction or relationship that
reasonably could be expected to give rise to an actual or apparent
conflict of interest between the Fund and such Senior Financial
Officer. The Audit Committee shall thereafter take such action with
respect to the conflict of interest as it shall deem appropriate. It
is the general policy of the Fund that conflicts of interest should
be avoided whenever practicable. For purposes of this Sarbanes-Oxley
Code of Ethics, a "conflict of interest" will be deemed to be
present when an individual's private interest interferes in any way,
or even appears to interfere, with the interests of the Fund as a
whole.
2. Each Senior Financial Officer will use his or her best efforts to
ensure the timely and understandable disclosure of information that,
in all material respects, is accurate, complete, objective and
relevant in all reports and documents the Fund files with, or
submits to, the SEC or in other public communications that the Fund
makes. As part of this undertaking, each Senior Financial Officer
will periodically consider the adequacy and effectiveness of the
Fund's "internal controls" and "disclosure controls and procedures"
(as such terms are defined or used in rules proposed or adopted by
the SEC).
3. Each Senior Financial Officer will use his or her best efforts to
ensure compliance in all material respects by such Senior Financial
Officer and the Fund with all applicable Laws.
4. Each Senior Financial Officer shall respect the confidentiality of
information acquired in the course of his or her work and shall not
disclose such information, except when the Senior Financial Officer
believes he or she is authorized or legally obligated to disclose
the information. No Senior Financial Officer may use confidential
information acquired in the course of his or her work for his or her
personal advantage.
2
5. No Senior Financial Officer may take or direct or allow any other
person to take or direct any action to fraudulently influence,
coerce, manipulate or mislead the Fund's independent auditing firm.
6. No Senior Financial Officer may engage the Fund's auditing firm to
perform audit or non-audit services without the Audit Committee's
(or its designee's) preapproval in accordance with the Audit
Committee's charter.
REPORTING VIOLATIONS
If any person believes that a Senior Financial Officer has violated this
Sarbanes-Oxley Code of Ethics or the Fund has or is about to violate a Law, or a
Senior Financial Officer believes that he or she is being asked to violate this
Sarbanes-Oxley Code of Ethics or any Law in the performance of his or her duties
for the Fund, then the matter should be promptly reported to the Audit
Committee. The Audit Committee will take appropriate steps to maintain the
confidentiality of the reporting person's identity, to the extent consistent
with the Fund's obligations to investigate and remedy the matter and, if
appropriate, to report the matter to government officials. Persons may report
violations of this Sarbanes-Oxley Code of Ethics on an anonymous basis. No
retribution will be taken against a person for reporting, in good faith, a
violation or suspected violation of this Sarbanes-Oxley Code of Ethics.
INTERPRETATION AND ENFORCEMENT
The Audit Committee is responsible for overseeing the interpretation and
enforcement of this Sarbanes-Oxley Code of Ethics. When the Audit Committee
considers any matter relating to this Sarbanes-Oxley Code of Ethics, it shall
act in executive session.
Each Senior Financial Officer will be held accountable for his or her
adherence to this Sarbanes-Oxley Code of Ethics by the Fund's Board of
Directors. A Senior Financial Officer's failure to adhere to this Sarbanes-Oxley
Code of Ethics will be subject to appropriate disciplinary action, ranging from
warnings to possible termination or removal.
Only the Audit Committee may waive or amend this Sarbanes-Oxley Code of
Ethics. All waivers and amendments of this Sarbanes-Oxley Code of Ethics must be
publicly disclosed in a manner that complies with the requirements of the SEC
and other applicable Laws.
3