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          STATEMENT OF RIGHTS, DESIGNATIONS AND PREFERENCES OF VARIABLE
                                      RATE
                      CUMULATIVE PREFERRED STOCK, SERIES R


     1.   Name of Corporation: Summit Securities, Inc.

     2.   Copy of resolution establishing and designating Variable Rate
Cumulative Preferred Stock, Series R, and determining the relative rights and
preferences thereof: Attached hereto.

     3.   The undersigned does hereby certify that the attached resolution was
duly adopted by the Board of Directors of the corporation on February 12, 2001.


     Dated this first day of March, 2001.


                                       /s/ Greg Strate
                                       -----------------------------------
                                       Greg Strate, Secretary
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                             SUMMIT SECURITIES, INC.
                PREFERRED STOCK, SERIES R, AUTHORIZING RESOLUTION

     Resolved, that pursuant to the authority expressly granted and vested in
the Board of Directors (the "Board") of this Corporation by its Articles of
Incorporation, as amended, a subseries of preferred stock, Series R of the
Corporation be, and is hereby, established which will have a par value of $10.00
per share, designated "Variable Rate Cumulative Preferred Stock, Series R"
(hereafter called "Series R Preferred Stock"), and which shall have rights,
preferences, qualifications and restrictions as follows:

     1.   DIVIDENDS.

          (a)  Dividends (or other distributions deemed dividends for purposes
     of this resolution) on the issued and outstanding shares of Series R
     Preferred Stock shall be declared and paid monthly at a percentage rate per
     annum of the liquidation preference of $100.00 per share equal to the
     "Distribution Rate," as hereinafter defined, or such greater rate as may be
     determined by the Corporation's Investment Committee (the "Committee").
     Notwithstanding the foregoing, the Distribution Rate for any monthly
     dividend period shall, in no event, be less than 6% per annum or greater
     than 14% per annum. Such dividends shall be cumulative from the date of
     original issue of each share and shall be payable, when and as declared by
     the Board, on such dates as the Board deems advisable, but at least once a
     year, commencing March 1, 2001. Each such dividend shall be paid to the
     holders of record of shares of Series R Preferred Stock as they appear on
     the stock register of the Corporation on such record date as shall be fixed
     by the Board in advance of the payment date thereof. Dividends on account
     of arrears for any past Dividend Periods may be declared and paid at any
     time, without reference to any regular dividend payment date, to holders of
     record on such date as shall be fixed by the Board in advance of the
     payment date thereof.

          (b)  Except as provided below in this section, the Distribution Rate
     for any monthly dividend period shall be the highest of the Treasury Bill
     Rate, the Ten Year Constant Maturity Rate and the Twenty Year Constant
     Maturity Rate (each as defined in Exhibit A attached hereto and
     incorporated by reference herein) plus 0.10%. In the event that the Board
     determines in good faith that for any reason one or more of such rates
     cannot be determined for any dividend period, then the Distribution Rate
     for such dividend period shall be the higher of whichever of such rates can
     be so determined. In the event that the Board determines in good faith that
     none of such rates can be determined for any dividend period, then the
     Distribution Rate in effect for the preceding dividend period shall be
     continued for such dividend period. The Treasury Bill Rate, the Ten Year
     Constant Maturity Rate and the Twenty Year Constant Maturity Rate shall
     each be rounded to the nearest five hundredths of a percentage point.

          (c)  No dividend shall be paid upon, or declared or set apart for, any
     share of Series R Preferred Stock for any Dividend Period unless at the
     same time a like dividend shall be paid upon, or be declared and set apart
     for, all shares of Series R Preferred Stock then issued and outstanding.
     Holders of Series R Preferred Stock shall not be entitled to any dividend,
     whether payable in cash, property or stock, in excess of full cumulative
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     dividends as herein provided. No interest, or sum of money in lieu of
     interest, shall be payable in respect of any dividend payment or payments
     which may be in arrears on Series R Preferred Stock.

          (d)  Dividends will be payable in additional whole or fractional
     shares of Series R Preferred Stock. The number of fractional shares of
     Series R Preferred Stock to be issued for each full monthly Dividend Period
     for each Series R share shall be equal to one share multiplied by the
     Distribution Rate for such monthly Dividend Period, divided by 12.
     Dividends payable for any period less than a full monthly Dividend Period
     shall be computed on the basis of 30- day months and a 360-day year. The
     Distribution Rate with respect to each monthly Dividend Period shall be
     calculated as promptly as practicable by the Corporation according to the
     method provided herein. The Corporation will cause notice of such
     Distribution Rate to be enclosed with the dividend notice mailed to the
     holders of shares of Series R Preferred Stock.

          (e)  So long as any shares of Series R Preferred Stock are
     outstanding, (i) no dividend (other than a dividend in common stock or in
     any other stock ranking junior to Series R Preferred Stock as to dividends
     and upon liquidation and other than as provided in the foregoing section
     1(c)) shall be declared or paid or set aside for payment; (ii) no other
     distribution shall be declared or made upon common stock or upon any other
     stock ranking junior to or on a parity with Series R Preferred Stock as to
     dividends or upon liquidation; and (iii) no common stock or any other stock
     of the Corporation ranking junior to or on a parity with Series R Preferred
     Stock as to dividends or upon liquidation shall be redeemed, purchased or
     otherwise acquired by the Corporation for any consideration (or any monies
     paid to or made available for a sinking fund for the redemption of any
     shares of any such stock) except by conversion into or exchange for stock
     of the Corporation ranking junior to Series R Preferred Stock as to
     dividends and upon liquidation unless, in each case, the full cumulative
     dividends on all outstanding shares of Series R Preferred Stock shall have
     been paid or declared and set apart for all past dividend payment periods.

          (f)  The holders of Series R Preferred Stock shall be entitled to
     receive, when and as declared by the Board, dividend distributions out of
     the authorized preferred stock of the Corporation legally available
     therefor. Any distribution made which may be deemed to have been made out
     of the capital surplus of Series R Preferred Stock shall not reduce either
     the redemption process or the liquidation rights as hereafter specified.

     2.   REDEMPTION.

          (a)  REDEMPTION AT THE OPTION OF THE CORPORATION. The Corporation, at
     its option, may redeem shares of Series R Preferred Stock, in whole or in
     part, at any time or from time to time, at redemption prices hereafter set
     forth plus accrued and unpaid dividends to the date fixed for redemption.

               (i)  In the event of a redemption of shares pursuant to this
          subsection, the redemption price shall be $100.00 per share.

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               (ii) In the event that fewer than all of the outstanding shares
          of Series R Preferred Stock are to be redeemed, the number of shares
          to be redeemed shall be determined by the Corporation and the shares
          to be redeemed shall be determined by lot, or pro rata, or by any
          other method, as may be determined by the Corporation in its sole
          discretion to be equitable.

               (iii) In the event that the Corporation shall redeem shares
          hereunder, notice of such redemption shall be given by first class
          mail, postage prepaid, mailed not less than 30 days or more than 60
          days prior to the redemption date, to each holder of record of the
          shares to be redeemed, at such holder's address as it appears on the
          stock register of the Corporation. Each such notice shall state: (A)
          the redemption date; (B) the number of shares to be redeemed and, if
          fewer than all shares held by such holder are to be redeemed, the
          number of such shares to be redeemed from such holder; (C) the
          redemption price; (D) the place or places where certificates for such
          shares are to be surrendered for payment of the redemption price; and
          (E) that dividends on the shares to be redeemed will cease to accrue
          on such redemption date.

               (iv) Notice having been mailed as aforesaid, from and after the
          redemption date (unless default shall be made by the Corporation in
          providing money for the payment of the redemption price), dividends on
          the shares so called for redemption shall no longer be deemed to be
          outstanding, and all rights of the holders thereof as stockholders of
          the Corporation (except the right to receive from the Corporation the
          redemption price) shall cease. Upon surrender in accordance with said
          notice of the certificates representing shares redeemed (properly
          endorsed or assigned for transfer, if the Board shall so require and
          the notice shall so state), such shares shall be redeemed by the
          Corporation at the redemption price aforesaid. In case fewer than all
          of the shares represented by any such certificate are redeemed, a new
          certificate shall be issued representing the unredeemed shares without
          cost to the holder thereof.

          (b)  DISCRETIONARY REDEMPTION UPON REQUEST OF THE HOLDER. The shares
     of Series R Preferred Stock are not redeemable at the option of the holder.
     If, however, the Corporation receives an unsolicited written request for
     redemption of shares from any holder, the Corporation may, in its sole
     discretion and subject to the limitations described below, accept such
     shares for redemption. Any shares so tendered, which the Corporation in its
     discretion, allows for redemption, shall be redeemed by the Corporation
     directly, and not from or through a broker or dealer, at $99.00 per share,
     plus any declared but unpaid dividends through the date of redemption.

          The Corporation may not redeem any such shares tendered for redemption
     if to do so would be unsafe or unsound in light of the Corporation's
     financial condition (including its liquidity position); if payment of
     interest or principal on any outstanding instrument of indebtedness is in
     arrears or in default; or if payment of any dividend on Series R Preferred
     Stock or share of any stock of the Company ranking on parity with or senior
     to the Series R Preferred Stock is in arrears as to dividends.

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          (c)  Any shares of Series R Preferred Stock which shall at any time
     have been redeemed shall, after such redemption, have the status of
     authorized but unissued shares of preferred stock, without designation as
     to series until such shares are designated as part of a particular series
     by the Board.

          (d)  Notwithstanding the foregoing provisions of this Section 2, if
     any dividends on Series R Preferred Stock are in arrears, no shares of
     Series R Preferred Stock shall be redeemed unless all outstanding shares of
     Series R Preferred Stock are simultaneously redeemed, and the Corporation
     shall not purchase or otherwise acquire any shares of Series R Preferred
     Stock; provided, however, that the foregoing shall not prevent the purchase
     or acquisition of shares of Series R Preferred Stock pursuant to a purchase
     or exchange offer made on the same terms to holders of all of the
     outstanding shares of Series R Preferred Stock. Notwithstanding anything
     herein to the contrary, no share of Series R Preferred Stock may be
     redeemed prior to the expiration of 3 years from the date of issuance of
     that share, except in the case of death or a major medical emergency.

     3.   CONVERSION OR EXCHANGE. The holders of shares of Series R Preferred
Stock shall not have any rights to convert such shares into or exchange such
shares for shares of any other class or series of any class of securities of the
Corporation.

     4.   VOTING. Except as required from time to time by law, the shares of
Series R Preferred Stock shall have no voting powers. Provided, however,
notwithstanding the foregoing, that whenever and as often as dividends payable
on any shares of Series R Preferred Stock shall be in arrears in an amount equal
to 24 full monthly dividends or more per share, the holders of Series R
Preferred Stock together with the holders of any other preferred stock then
outstanding, voting separately and as a single class shall be entitled to elect
a majority of the Board of Directors of the Corporation. Such right shall
continue until all dividends in arrears on preferred stock have been paid in
full.

     5.   LIQUIDATION RIGHTS.

          (a)  Upon the dissolution, liquidation or winding up of the
     Corporation, the holders of the shares of Series R Preferred Stock shall be
     entitled to receive out of the assets of the Corporation, before any
     payment or distribution shall be made on the Common Stock, or on any other
     class of stock ranking junior to Series R Preferred Stock, upon
     liquidation, the amount of $100.00 per share, plus a sum equal to all
     dividends (whether or not earned or declared) on such shares accrued and
     unpaid thereon to the date of final distribution.

          (b)  Neither the sale, lease or conveyance of all or substantially all
     the property or business of the Corporation, nor the merger or
     consolidation of the Corporation into or with any other corporation or the
     merger or consolidation of any other corporation into or with the
     Corporation, shall be deemed to be a dissolution, liquidation or winding
     up, voluntary or involuntary, for the purposes of this Section.

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          (c)  After the payment to the holders of the shares of Series R
     Preferred Stock of the full preferential amounts provided for in this
     Section, the holders of Series R Preferred Stock as such shall have no
     right or claim to any of the remaining assets of the Corporation.

          (d)  In the event the assets of the Corporation available for
     distribution to the holders of shares of Series R Preferred Stock upon any
     dissolution, liquidation or winding up of the Corporation, whether
     voluntary or involuntary, shall be insufficient to pay in full all amounts
     to which such holders are entitled pursuant to this Section, no such
     distribution shall be made on account of any shares or any other series of
     preferred stock ranking on parity with the Series R Preferred Stock or any
     other class of stock ranking on a parity with the shares of Series R
     Preferred Stock upon such dissolution, liquidation or winding up, unless
     proportionate distributive amounts shall be paid on account of the shares
     of Series R Preferred Stock, ratably in accordance with the sums which
     would be payable in such distribution if all sums payable in respect of the
     shares of all series of preferred stock and any such other class of stock,
     both as aforesaid, were discharged in full.

     6.   PRIORITIES. For purposes of this Resolution, any stock of any class or
classes of the Corporation shall be deemed to rank:

          (a)  Prior to the shares of Series R Preferred Stock, either as to
     dividends or upon liquidation if the holders of such class or classes shall
     be entitled to the receipt of dividends or of amounts distributable upon
     dissolution, liquidation or winding up of the Corporation, as the case may
     be, in preference or priority to the holders of shares of Series R
     Preferred Stock.

          (b)  On a parity with shares of Series R Preferred Stock, either as to
     dividends or upon liquidation, whether or not the dividend rates, dividend
     payment dates or redemption or liquidation prices per share or sinking fund
     provisions, if any, are different from those of Series R Preferred Stock,
     if the holder of such stock shall be entitled to the receipt of dividends
     or of amounts distributable upon dissolution, liquidation or winding up of
     the Corporation, as the case may be, in proportion to their respective
     dividend rates or liquidation prices, without preference or priority, one
     over the other, as between the holder of such stock and the holders of
     Series R Preferred Stock; and

          (c)  Junior to shares of Series R Preferred Stock, either as to
     dividends or upon liquidation, if the holders of shares of Series R
     Preferred Stock shall be entitled to receipt of dividends or of amounts
     distributable upon dissolution, liquidation or winding up of the
     Corporation, as the case may be, in preference or priority to the holders
     of shares of such class or classes.

     7.   RANKING AND SUBORDINATION. The Series R Preferred Stock shall rank on
parity with the Series T Preferred Stock of the Corporation. The Series R
Preferred Stock shall be subordinate in right of payment for distributions and
upon liquidation of the Corporation to the Corporation's Series S Preferred
Stock.

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     8.   SHARES NON-ASSESSABLE. Any and all shares of Series R Preferred Stock
issued, and for which the full consideration has been paid or delivered, shall
be deemed fully paid stock and the holder of such shares shall not be liable for
any further call or assessment or any other payment thereon.

     9.   PRE-EMPTIVE RIGHTS. Holders of Series R Preferred Stock shall have no
pre-emptive rights to acquire additional shares of Series R Preferred Stock.


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                                    EXHIBIT A

TREASURY BILL RATE

     Except as provided below in this paragraph, the "Treasury Bill Rate" for
each dividend period will be the arithmetic average of the two most recent
weekly per annum market discount rates (or the one weekly per annum market
discount rate, if only one such rate shall be published during the relevant
Calendar Period (as defined below)) for three-month U.S. Treasury bills, as
published weekly by the Federal Reserve Board during the Calendar Period that
begins 24 days prior to the first day of the dividend period for which the
dividend rate on Preferred Stock Series R, is being determined. In the event
that the Federal Reserve Board does not publish such a weekly per annum market
discount rate during any such Calendar Period, then the Treasury Bill Rate for
the related dividend period shall be the arithmetic average of the two most
recent weekly per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate shall be published during the
relevant Calendar Period) for three-month U.S. Treasury bills, as published
weekly during such Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Company. In the event that a per
annum market discount rate for three-month U.S. Treasury bills shall not be
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the
Treasury Bill Rate for such dividend period shall be the arithmetic average of
the two most recent weekly per annum market discount rates (or the one weekly
per annum market discount rate, if only one such rate shall be published during
the relevant Calendar Period) for all of the U.S. Treasury bills then having
maturities of not less than 80 nor more than 100 days, as published during such
Calendar Period by the Federal Reserve Board or, if the Federal Reserve Board
shall not publish such rates, by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Company. In the event that the
Company determines in good faith that for any reason no such U.S. Treasury bill
rates are published as provided above during such Calendar Period, then the
Treasury Bill Rate for such dividend period shall be the arithmetic average of
the per annum market discount rates based upon bids during such Calendar Period
for each of the issues of marketable non-interest bearing U.S. Treasury
securities with a maturity of not less than 80 nor more than 100 days from the
date of each such quotation, as quoted daily for each business day in New York
City (or less frequently if daily quotations shall not be generally available)
to the Company by at least three recognized primary U.S. Government securities
dealers selected by the Company. In the event that the Company determines in
good faith that for any reason the Company cannot determine the Treasury Bill
Rate for any dividend period as provided above in this paragraph, the Treasury
Bill Rate for such dividend period shall be the arithmetic average of the per
annum market discount rates based upon the closing bids during such Calendar
Period for each of the issues of marketable interest-bearing U.S. Treasury
securities with a maturity of not less than 80 nor more than 100 days from the
date of each such quotation, as quoted daily for each business day in New York
City (or less frequently if daily quotations shall not be generally available)
to the Company by at least three recognized primary U.S. Government securities
dealers selected by the Company.

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TEN YEAR CONSTANT MATURITY RATE

     Except as provided below in this paragraph, the "Ten Year Constant Maturity
Rate" for each dividend period shall be the arithmetic average of the two most
recent weekly per annum Ten Year Average Yields (or the one weekly per annum Ten
Year Average Yield, if only one such Yield shall be published during the
relevant Calendar Period as provided below), as published weekly by the Federal
Reserve Board during the Calendar Period that begins 24 days prior to the first
day of the dividend period for which the dividend rate on Preferred Stock,
Series R is being determined. In the event that the Federal Reserve Board does
not publish such a weekly per annum Ten Year Average Yield during such Calendar
Period, then the Ten Year Constant Maturity Rate for such dividend period shall
be the arithmetic average of the two most recent weekly per annum Ten Year
Average Yields (or the one weekly per annum Ten Year Average Yield, if only one
such Yield shall be published during such Calendar Period), as published weekly
during such Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Company. In the event that a per
annum Ten Year Average Yield shall not be published by the Federal Reserve Board
or by any Federal Reserve Bank or by any U.S. Government department or agency
during such Calendar Period, then the Ten Year Constant Maturity Rate for such
dividend period shall be the arithmetic average of the two most recent weekly
per annum average yields to maturity (or the one weekly average yield to
maturity, if only one such yield shall be published during the relevant Calendar
Period) for all of the actively traded marketable U.S. Treasury fixed interest
rate securities (other than Special Securities (as defined below)) then having
maturities of not less than eight nor more than 12 years, as published during
such Calendar Period by the Federal Reserve Board or, if the Federal Reserve
Board shall not publish such yields, by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Company. In the event that the
Company determines in good faith that for any reason the Company cannot
determine the Ten Year Constant Maturity Rate for any dividend period as
provided above in this paragraph, then the Ten Year Constant Maturity Rate for
such dividend period shall be the arithmetic average of the per annum average
yields to maturity based upon the closing bids during such Calendar Period for
each of the issues of actively traded marketable U.S. Treasury fixed interest
rate securities (other than Special Securities) with a final maturity date not
less than eight nor more than 12 years from the date of each such quotation, as
quoted daily for each business day in New York City (or less frequently if daily
quotations shall not be generally available) to the Company by at least three
recognized primary U.S. Government securities dealers selected by the Company.

TWENTY YEAR CONSTANT MATURITY RATE

     Except as provided below in this paragraph, the "Twenty Year Constant
Maturity Rate" for each dividend period shall be the arithmetic average of the
two most recent weekly per annum Twenty Year Average Yields (or the one weekly
per annum Twenty year Average Yield, if only one such Yield shall be published
during the relevant Calendar Period), as published weekly by the Federal Reserve
Board during the Calendar Period that begins 24 days prior to the first day of
the dividend period for which the dividend rate on Preferred Stock, Series R is
being determined. In the event that the Federal Reserve Board does not publish
such a weekly per annum Twenty Year Average Yield during such Calendar Period,
then the Twenty Year Constant Maturity Rate for such dividend period shall be
the arithmetic average of the two most recent

                                      A-2
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weekly per annum Twenty Year Average Yields (or the one weekly per annum Twenty
Year Average Yield, if only one such Yield shall be published during such
Calendar Period), as published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency selected by the
Company. In the event that a per annum Twenty Year Average Yield shall not be
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the
Twenty Year Constant Maturity Rate for such dividend period shall be the
arithmetic average of the two most recent weekly per annum average yields to
maturity (or the one weekly average yield to maturity, if only one such yield
shall be published during such Calendar Period) for all of the actively traded
marketable U.S. Treasury fixed interest rate securities (other than Special
Securities) then having maturities of not less than 18 nor more than 22 years,
as published during such Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board shall not publish such yields, by any Federal Reserve Bank
or by any U.S. Government department or agency selected by the Company. In the
event that the Company determines in good faith that for any reason the Company
cannot determine the Twenty Year Constant Maturity Rate for any dividend period
as provided above in this paragraph, then the Twenty Year Constant Maturity Rate
for such dividend period shall be the arithmetic average of the per annum
average yields to maturity based upon the closing bids during such Calendar
Period for each of the issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Securities) with a final maturity
date not less than 18 nor more than 22 years from the date of each such
quotation, as quoted daily for each business day in New York City (or less
frequently if daily quotations shall not be generally available) to the Company
by at least three recognized primary U.S. Government securities dealers selected
by the Company.

     As used herein, the term "Calendar Period" means a period of 14 calendar
days; the term "Special Securities" means securities which may, at the option of
the holder, be surrendered at face value in payment of any federal estate tax or
which provide tax benefits to the holder and are priced to reflect such tax
benefits or which were originally issued at a deep or substantial discount; the
term "Ten Year Average Yield" means the average yield to maturity for actively
traded marketable U.S. Treasury fixed interest rate securities (adjusted to
constant maturities of ten years); and the term "Twenty Year Average Yield"
means the average yield to maturity for actively traded marketable U.S. Treasury
fixed interest rate securities (adjusted to constant maturities of 20 years).


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