HIGHMARK FUNDS
CODE OF ETHICS PURSUANT TO SECTION 406 OF THE SARBANES-OXLEY ACT OF 2002 FOR
PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS
SEPTEMBER 17, 2003
I. COVERED OFFICERS/PURPOSE OF THE CODE
This Code of Ethics (this "Code") pursuant to Section 406 of the
Sarbanes-Oxley Act of 2002 has been adopted by HighMark Funds (the "Trust") and
applies to the Trust's Principal Executive Officer, Principal Financial Officer
and Principal Accounting Officer (the "Covered Officers," 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 Trust files with, or submits to,
the Securities and Exchange Commission ("SEC") and in other
public communications made by the Trust;
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 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 or her service to, the
Trust. For example, a conflict of interest would arise if a Covered Officer, or
a member of the Covered Officer's family, receives improper personal benefits as
a result of the Covered Officer's position with the Trust.
Certain conflicts of interest arise out of the relationships between
Covered Officers and the Trust and already are subject to conflict of interest
provisions in the Investment Company Act of 1940 (including the regulations
thereunder, the "1940 Act")
and the Investment Advisers Act of 1940 (including the regulations thereunder,
the "Investment Advisers Act"). For example, Covered Officers may not engage in
certain transactions (such as the purchase or sale of portfolio securities or
other property) with the Trust because of their status as "affiliated persons"
of the Trust. The compliance programs and procedures of the Trust and its
investment advisers (including sub-advisers), principal underwriter,
administrator or sub-administrator (each a "Service Provider" and, collectively,
the "Service Providers") 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. See also Section V of this Code.
Although typically not presenting an opportunity for improper personal
benefit, conflicts may arise from, or as a result of, the contractual
relationship between the Trust and its Service Providers 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 for the
Trust or for a Service Provider, or for both), be involved in establishing
policies and implementing decisions that will have different effects on the
Service Providers and the Trust. The participation of the Covered Officers in
such activities is inherent in the contractual relationships between the Trust
and its Service Providers and is consistent with the performance by the Covered
Officers of their duties as officers of the Trust. Thus, if performed in
conformity with the provisions of the 1940 Act, the Investment Advisers Act,
other applicable law and the Trust's organizational documents, such activities
will be deemed to have been handled ethically. In addition, it is recognized by
the Trust's Board of Trustees (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 and that such service, by itself, does not give rise to a
conflict of interest.
Other conflicts of interest are covered by the Code, even if such
conflicts of interest are not the subject of provisions of the 1940 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 overarching principle is that the personal
interest of a Covered Officer should not be placed before the interest of the
Trust, unless the personal interest has been disclosed to and approved by the
Trust's Audit Committee (the "Committee").
* * * *
Each Covered Officer must not:
o use his or her personal influence or personal relationships to
influence investment decisions or financial reporting by the
Trust whereby the Covered Officer would benefit personally to the
detriment of the Trust;
o cause the Trust to take action, or fail to take action, for the
individual personal benefit of the Covered Officer rather than
the benefit of the Trust; or
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o retaliate against any other Covered Officer or any employee of
the Trust or its Service Providers for reports of potential
violations that are made in good faith.
There are some conflict of interest situations that should always be
approved by the President of the Trust (or, with respect to activities of the
President, by the chairman of the Committee). These conflict of interest
situations are listed below:
o service on the board of directors or governing board of a
publicly traded entity;
o the receipt of any non-nominal gifts valued in excess of $100
from persons or entities who have or are seeking business
relationships with the Trust;
o the receipt of any entertainment from any company with which the
Trust 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 entities doing business with the Trust,
other than a Service Provider or an affiliate of a Service
Provider. This restriction shall not apply to or otherwise limit
the ownership of publicly traded securities so long as the
Covered Person's ownership does not exceed more than 2% of the
outstanding securities of the relevant class.
o a direct or indirect financial interest in commissions,
transaction charges or spreads paid by the Trust for effecting
portfolio transactions or for selling or redeeming shares other
than an interest arising from the Covered Officer's employment
with a Service Provider or its affiliates. This restriction shall
not apply to or otherwise limit (i) the ownership of publicly
traded securities so long as the Covered Person's ownership does
not exceed more than 2% of the particular class of security
outstanding or (ii) the receipt by a Service Provider or an
affiliate of research or other benefits in exchange for "soft
dollars."
III. DISCLOSURE AND COMPLIANCE
o Each Covered Officer should familiarize himself or herself with
the disclosure requirements generally applicable to the Trust;
o each Covered Officer should not knowingly misrepresent, or cause
others to misrepresent, facts about the Trust to others, whether
within or outside the Trust, including to the Trust's Board and
auditors, and to governmental regulators and self-regulatory
organizations;
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o each Covered Officer should, to the extent appropriate within his
or her area of responsibility, consult with other officers and
employees of the Trust and the Service Providers or with counsel
to the Trust with the goal of promoting full, fair, accurate,
timely and understandable disclosure in the reports and documents
the Trust files with, or submits to, the SEC (which, for the sake
of clarity, does not include any sales literature, omitting
prospectuses, or "tombstone" advertising prepared by the Trust's
principal underwriter) and in other public communications made by
the Trust; 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 Trust that
he or she has received, read and understands the Code;
o annually thereafter affirm to the Trust that he or she has
complied with the requirements of the Code;
o provide full and fair responses to all questions asked in the
Trust's periodic Trustee and Officer Questionnaire as well as
with respect to any supplemental request for information; and
o notify the President of the Trust promptly if he or she knows of
any material violation of this Code (with respect to violations
by a President, the Covered Officer shall report to the chairman
of the Committee). Failure to do so is itself a violation of this
Code.
The President of the Trust 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 President will be considered by the
Committee.
The Trust will follow these procedures in investigating and enforcing
this Code (in the case of a suspected violation of this Code by the President,
the actions specified below to be taken by the President will instead be the
responsibility of the chairman of the Committee):
o the President will take all appropriate action to investigate any
potential material violations reported to him, which may include
the use of internal or external counsel, accountants or other
personnel;
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o if, after such investigation, the President believes that no
material violation has occurred, the President is not required to
take any further action;
o any matter that the President believes is a material violation
will be reported to the Committee;
o if the Committee concurs that a material 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 a Service Provider or
its board; or a recommendation to dismiss the Covered Officer;
o the Committee will be authorized to grant waivers, as it deems
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 Trust 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 Trust or the 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 conflict
with the provisions of this Code. The Trust's and its Service Providers' codes
of ethics under Rule 17j-1 under the 1940 Act and the Service Providers' more
detailed compliance policies and procedures 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.
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 except as authorized by the Board.
VIII. INTERNAL USE
The Code is intended solely for the internal use by the Trust and does
not constitute an admission, by or on behalf of the Trust, as to any fact,
circumstance or legal conclusion.
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EXHIBIT A
PERSONS COVERED BY THIS CODE OF ETHICS
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TRUST PRINCIPAL EXECUTIVE PRINCIPAL FINANCIAL PRINCIPAL
OFFICER OFFICER ACCOUNTING OFFICER
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HighMark Funds James R. Foggo Peter Golden Peter Golden
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