1
EXHIBIT (9)(a)
ADMINISTRATIVE SERVICES AND
TRANSFER AGENCY AGREEMENT
This Agreement, made and entered into this 1st day of April, 1987, by and
between Security Income Fund, a Kansas corporation ("Fund"), and Security
Management Company, a Kansas corporation, ("SMC").
WHEREAS, the Fund is engaged in business as an open-end management investment
company registered under the Investment Company Act of 1940; and
WHEREAS, Security Management Company is willing to provide general
administrative, fund accounting, transfer agency, and dividend disbursing
services to the Fund under the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual agreements made
herein, the parties agree as follows:
1. Employment of Security Management Company
SMC will provide the Fund with general administrative, fund
accounting, transfer agency, and dividend disbursing services
described and set forth in Schedule A attached hereto and made
a part of this agreement by reference. SMC agrees to maintain
sufficient trained personnel and equipment and supplies to
perform such services in conformity with the current
prospectus of the Fund and such other reasonable standards of
performance as the Fund may from time to time specify, and
otherwise in an accurate, timely, and efficient manner.
2. Compensation
As consideration for the services described in Section I, the
Fund agrees to pay SMC a fee as described and set forth in
Schedule B attached hereto and made a part of this agreement
by reference, as it may be amended from time to time, such fee
to be calculated and accrued daily and payable monthly.
3. Expenses
A. Expenses of SMC. SMC shall pay all of the expenses
incurred in providing Fund the services and
facilities described in this agreement, whether or
not such expenses are billed to SMC or the fund,
except as otherwise provided herein.
B. Direct Expenses. Anything in this agreement to the
contrary notwithstanding, the Fund shall pay, or
reimburse SMC for the payment of, the following
described expenses of the Fund (hereinafter called
"direct expenses") whether or not billed to the Fund,
SMC or any related entity:
2
1. Fees and expenses of its independent
directors and the meetings thereof;
2. Fees and costs of investment advisory
services;
3. Fees and costs of independent auditors and
income tax preparation;
4. Fees and costs of outside legal counsel and
any legal counsel directly employed by the
Fund or its Board of Directors;
5. Custodian and banking services, fees and
costs;
6. Costs of printing and mailing prospectuses to
existing shareholders, proxy statements and
other reports to shareholders, where such
costs are incurred through the use of
unaffiliated vendors or mail services.
7. Fees and costs for the registration of its
securities with the Securities and Exchange
Commission and the jurisdictions in which it
qualifies its share for sale, including the
fees and costs of registering and bonding
brokers, dealers and salesmen as required;
8. Dues and expenses associated with membership
in the Investment Company Institute;
9. Expenses of fidelity and liability insurance
and bonding covering Fund;
10. Organizational costs.
4. Insurance
The Fund and SMC agree to procure and maintain, separately or
as joint insureds with themselves, their directors, employees,
agents and others, and other investment companies for which
SMC acts as investment advisor and transfer agent, a policy or
policies of insurance against loss arising from breaches of
trust, errors and omissions, and a fidelity bond meeting the
requirements of the Investment Company Act of 1940, in the
amounts and with such deductibles as may be agreed upon from
time to time, and to pay such portions of the premiums
therefor as amount of the coverage attributable to each party
is to the aggregate amount of the coverage for all parties.
5. Registration and Compliance
A. SMC represents that as of the date of this agreement
it is registered as a transfer agency with the
Securities and Exchange Commission ("SEC") pursuant
to Subsection 17A of the Securities and Exchange Act
of 1934 and the rules and regulations thereunder, and
agrees to maintain said registration and comply with
all
3
of the requirements of said Act, rules and
regulations so long as this agreement remains in
force.
B. The Fund represents that it is a diversified
management investment company registered with the SEC
in accordance with the Investment Company Act of 1940
and the rules and regulations thereunder, and
authorized to sell its shares pursuant to said Act,
the Securities Act of 1933 and the rules and
regulations thereunder.
6. Liabilities and Indemnification
SMC shall be liable for any actual losses, claims, damages or
expenses (including any reasonable counsel fees and expenses)
resulting from SMC's bad faith, willful misfeasance, reckless
disregard of its obligations and duties, negligence or failure
to properly perform any of its responsibilities or duties
under this agreement. SMC shall not be liable and shall be
indemnified and held harmless by the Fund, for any claim,
demand or action brought against it arising out of, or in
connection with:
A. Bad faith, willful misfeasance, reckless disregard of
its duties or negligence of the Board of Directors of
the Fund, or SMC's acting upon any instructions
properly executed and authorized by the Board of
Directors of the Fund;
B. SMC acting in reliance upon advice given by
independent counsel retained by the Board of
Directors of the Fund.
In the event that SMC requests the Fund to indemnify or hold
it harmless hereunder, SMC shall use its best efforts to
inform the Fund of the relevant facts concerning the matter in
question. SMC shall use reasonable care to identify and
promptly notify the Fund concerning any matter which presents,
or appears likely to present, a claim for indemnification
against the Fund.
The Fund shall have the election of defending SMC against any
claim which may be the subject of indemnification hereunder.
In the event the Fund so elects, it will so notify SMC and
thereupon the Fund shall take over defenses of the claim, and
(if so requested by the Fund, SMC shall incur no further legal
or other claims related thereto for which it would be entitled
to indemnity hereunder provided, however, that nothing herein
contained shall prevent SMC from retaining, at its own
expense, counsel to defend any claim. Except with the Fund's
prior consent, SMC shall in no event confess any claim or make
any compromise in any matter in which the Fund will be asked
to indemnify or hold SMC harmless hereunder.
Punitive Damages. SMC shall not be liable to the
Fund, or any third party, for punitive, exemplary,
indirect, special or consequential damages (even if
SMC has been advised of the possibility of such
damages) arising from its obligations and the
services provided under this agreement, including but
not limited to loss of profits,
4
loss of use of the shareholder accounting
system, cost of capital and expenses of substitute
facilities, programs or services.
Force Majeure. Anything in this agreement to the
contrary notwithstanding, SMC shall not be liable for
delays or errors occurring by reason of circumstances
beyond its control, including but not limited to acts
of civil or military authority, national emergencies,
work stoppages, fire, flood, catastrophe, earthquake,
acts of God, insurrection, war, riot, failure of
communication or interruption.
7. Delegation of Duties
SMC may, at its discretion, delegate, assign or subcontract
any of the duties, responsibilities and services governed by
this agreement, to its parent company, Security Benefit Group,
Inc., whether or not by formal written agreement. SMC shall,
however, retain ultimate responsibility to the Fund, and shall
implement such reasonable procedures as may be necessary, for
assuring that any duties, responsibilities or services so
assigned, subcontracted or delegated are performed in
conformity with the terms and conditions of this agreement.
8. Amendment
This agreement and the schedules forming a part hereof may be
amended at any time, without shareholder approval, by a
writing signed by each of the parties hereto. Any change in
the Fund's registration statements or other documents of
compliance or in the forms relating to any plan, program or
service offered by its current prospectus which would require
a change in SMC's obligations hereunder shall be subject to
SMC's approval, which shall not be unreasonably withheld.
9. Termination
This agreement may be terminated by either party without cause
upon 120 days' written notice to the other, and at any time
for cause in the event that such cause remains unremedied for
more than 30 days after receipt by the other party of written
specification of such cause.
In the event Fund designates a successor to any of SMC's
obligations hereunder, SMC shall, at the expense and pursuant
to the direction of the Fund, transfer to such successor all
relevant books, records and other data of Fund in the
possession or under the control of SMC.
10. Severability
If any clause or provision of this agreement is determined to
be illegal, invalid or unenforceable under present or future
laws effective during the term hereof, then such
5
clause or provision shall be considered severed herefrom and
the remainder of this agreement shall continue in full force
and effect.
11. Term
This agreement initially shall become effective upon its
approval by a majority vote of the Board of Directors of the
Fund, including a majority vote of the Directors who are not
"interested persons" of Fund or SMC, as defined in the
Investment Company Act of 1940, and shall continue until
terminated pursuant to its provisions.
12. Applicable Law
This agreement shall be subject to and construed in accordance
with the laws of the State of Kansas.
SECURITY MANAGEMENT COMPANY
BY: Xxxxxxx X. Xxxxx, President
---------------------------
ATTEST:
Xxxxxxx X. Xxxxxx, Secretary
----------------------------
SECURITY INCOME FUND
BY: Xxxxxxx X. Xxxxx, President
---------------------------
ATTEST:
Xxxxxxx X. Xxxxxx, Secretary
----------------------------
6
SCHEDULE A
ADMINISTRATIVE SERVICES AND
TRANSFER AGENCY AGREEMENT
Schedule of Administrative and Fund Accounting
Facilities and Services
Security Management Company agrees to provide the Fund the following
Administrative facilities and services:
1. Fund and Portfolio Accounting
A. Maintenance of Fund General Ledger and Journal.
B. Preparing and recording disbursements for direct fund expenses.
C. Preparing daily money transfers.
D. Reconciliation of all Fund bank and custodian accounts.
E. Assisting Fund independent auditors as appropriate.
F. Prepare daily projection of available cash balances.
G. Record trading activity for purposes of determining net asset
values and daily dividend.
H. Prepare daily portfolio evaluation report to value portfolio
securities and determine daily accrued income.
I. Determine the daily net asset value per share.
J. Determine the daily, monthly, quarterly, semiannual or annual
dividend per share.
K. Prepare monthly, quarterly, semiannual and annual financial
statements.
L. Provide financial information for reports to the securities
and exchange commission in compliance with the provisions of
the Investment Company Act of 1940 and the Securities Act of
1933, the Internal Revenue Service and other regulatory
agencies as required.
M. Provide financial, yield, net asset value, etc. information to
NASD and other survey and statistical agencies as instructed
by the Fund.
7
N. Report to the Audit Committee of the Board of Directors, if
applicable.
2. Legal
A. Provide registration and other administrative services
necessary to qualify the shares of the Fund for sale in those
jurisdictions determined from time to time by the Fund's Board
of Directors (commonly known as "Blue Sky Registration").
B. Provide registration with and reports to the Securities and
Exchange Commission in compliance with the provisions of the
Investment Company Act of 1940 and the Securities Act of 1933.
C. Prepare and review Fund prospectus and Statement of Additional
Information.
D. Prepare proxy statements and oversee proxy tabulation for
annual meetings.
E. Prepare Board materials and maintain minutes of Board meetings.
F. Draft, review and maintain contractual agreements between Fund
and Investment Advisor, Custodian, Distributor and Transfer
Agent.
G. Oversee printing of proxy statements, financial reports to
shareholders, prospectuses and Statements of Additional
Information.
H. Provide legal advice and oversight regarding shareholder
transactions, administrative services, compliance with
contractual agreements and the provisions of the 1940 and 1933
Acts.
(Notwithstanding the above, outside counsel for the Funds may provide
the services listed above as a direct Fund expense or at the option of
the Funds, the Funds may employ their own counsel to perform any of
these services.)
8
SCHEDULE OF SHARE TRANSFER AND DIVIDEND DISBURSING SERVICES
Security Management Company agrees to provide the Fund the following transfer
agency and dividend disbursing services:
1. Maintenance of shareholder accounts, including processing of new
accounts.
2. Posting address changes and other file maintenance for shareholder
accounts.
3. Posting all transactions to the shareholder file, including:
A. Direct purchases
B. Wire order purchases
C. Direct redemptions
D. Wire order redemptions
E. Draft redemptions
F. Direct exchanges
G. Transfers
H. Certificate issuances
I. Certificate deposits
4. Monitor fiduciary processing, insuring accuracy and deduction of fees.
5. Prepare daily reconciliations of shareholder processing to money
movement instructions.
6. Handle bounced check collections. Immediately liquidate shares
purchased and return to the shareholder the check and confirmation of
the transaction.
7. Issuing all checks and stopping and replacing lost checks.
8. Draft clearing services.
A. Maintenance of signature cards and appropriate corporate
resolutions.
B. Comparison of the signature on the check to the signatures on
the signature card for the purpose of paying the face amount
of the check only.
9
C. Receiving checks presented for payment and liquidating shares
after verifying account balance.
D. Ordering checks in quantity specified by the Fund for the
shareholder.
9. Mailing confirmations, checks and/or certificates resulting from
transaction requests to shareholders.
10. Performing all of the Fund's other mailings, including:
A. Dividend and capital gain distributions.
B. Semiannual and annual reports.
C. 1099/year-end shareholder reporting.
D. Systematic withdrawal plan payments.
E. Daily confirmations.
11. Answering all service related telephone inquiries from shareholders
and others, including:
A. General and policy inquiries (research and resolve problems).
B. Fund yield inquiries.
C. Taking shareholder processing requests and account maintenance
changes by telephone as described above.
D. Submit pending requests to correspondence.
E. Monitor online statistical performance of unit.
F. Develop reports on telephone activity.
12. Respond to written inquiries (research and resolve problems);
including:
A. Initiate shareholder account reconciliation proceeding when
appropriate.
B. Notify shareholder of bounced investment checks.
C. Respond to financial institutions regarding verification of
deposit.
D. Initiate proceedings regarding lost certificates.
00
X. Xxxxxxx to complaints and log activities.
F. Correspondence control.
13. Maintaining and retrieving all required past history for shareholders
and provide research capabilities as follows:
A. Daily monitoring of all processing activity to verify back-up
documentation.
B. Provide exception reports.
C. Microfilming.
D. Storage, retrieval and archive.
14. Prepare materials for annual meetings.
A. Address and mail annual proxy and related material.
B. Prepare and submit to Fund and affidavit of mailing.
C. Furnish certified list of shareholders (hard copy or
microfilm) and inspectors of election.
15. Report and remit as necessary for state escheat requirements.
Approved: Fund__________________________ SMC Xxxxxxxx X. Xxxxx
11
MODEL: MONTHLY FUNDS
-------------
MAINTENANCE FEE. . . . . . . . . . . . . . . . . . $8.00
TRANSACTIONS . . . . . . . . . . . . . . . . . . . $1.00
DIVIDENDS . . . . . . . . . . . . . . . . . . . . $0.50
ADMINISTRATION FEE . . . . . . . . . . . . . . . . 0.00045
(BASED ON DAILY NET ASSET VALUE)
MASTER WORKSHEET BOND GOV HIGH YIEL
------------------------------------------------------------------
1986:
TRANSACTIONS - 6,897 603 260
DIVIDENDS - 23,264 2,195 314
SHAREHOLDER ACCTS - 3,574 226 258
AVERAGE NET ASSETS - 45,164,242.34 2,260,755.40 2,948,233.60
INCOME - 4,804,113.27 207,258.25 223,104.47
EXPENSES - 449,036.13 21,101.91 17,675.96
SERVICE FEES - 50,806.27 962.23 1,118.94
1986 1986
SERVICE TRANSFER & EXPENSE EXPENSE
FEES ADMINISTRATION PERCENT RATIO RATIO
ACTUAL MODEL INCREASE ACTUAL MODEL
BOND 50,806.27 67,444.91 32.75% 0.994% 1.031%
GOVERNMENT 962.23 4,525.84 370.35% 0.933% 1.091%
HIGH YIELD 1,118.94 2,603.71 132.69% 0.600% 0.862%
12
SCHEDULE B
AMENDMENT TO SECURITY INCOME FUND
ADMINISTRATIVE SERVICES AND
TRANSFER AGENCY AGREEMENT
Schedule of Fees
Annual Maintenance Fee................................ $8.00 per account
Transactions...........................................$1.00 per transaction
Administration Fee.....................................0.09% of the average
net assets of the Fund (calculated daily and payable monthly).
This amendment shall take effect as of April 28, 1989.
In witness thereof, the parties hereto have caused this amendment to
be executed on the date indicated.
Security Income Fund
By: Xxxxxxx X. Xxxxxxxx, President
------------------------------
Date: January 27, 1989
Attest:
Xxx X. Xxx, Secretary
---------------------
Security Management Company
By: Xxxxxxx X. Xxxxxxxx, President
------------------------------
Date: January 27, 1989
Attest:
Xxx X. Xxx, Secretary
---------------------
13
AMENDMENT TO ADMINISTRATIVE SERVICES
AND TRANSFER AGENCY AGREEMENT
WHEREAS, Security Income Fund (hereinafter referred to as the "Fund") and
Security Management Company (hereinafter referred to as "SMC") are parties to
an Administrative Services and Transfer Agency Agreement dated April 1, 1987,
(the "Administrative Services Agreement") under which SMC agrees to provide
general administrative, fund accounting, transfer agency, and dividend
disbursing services to the Fund in return for the compensation specified in the
Administrative Services Agreement; and
WHEREAS, on July 7, 1989, the Board of Directors of the Fund voted to amend the
Administrative Services Agreement to provide for payment by the Fund of the
fees of all directors;
NOW THEREFORE, the Fund and the Management Company hereby amend the
Administrative Services Agreement, dated April 1, 1987, effective July 7, 1989,
as follows:
Paragraph 3.B.1. shall be deleted in its entirety and the following
paragraph inserted in lieu thereof:
3. Expenses
B. Direct Expenses
1. Fees and expenses of its directors (including the
fees of those directors who are deemed to be
"interested persons" of the Fund as that term is
defined in the Investment Company Act of 1940) and
the meetings thereof;
IN WITNESS WHEREOF, the parties hereto have made this Amendment to the
Administrative Services Agreement this 7th day of July, 1989.
SECURITY INCOME FUND
By: Xxxxxxx X. Xxxxxxxx, President
------------------------------
Attest:
Xxx X. Xxx, Secretary
---------------------
SECURITY MANAGEMENT COMPANY
By: Xxxxxxx X. Xxxxxxxx, President
------------------------------
Attest:
Xxx X. Xxx, Secretary
---------------------
14
AMENDMENT TO ADMINISTRATIVE SERVICES
AND TRANSFER AGENCY AGREEMENT
WHEREAS, Security Income Fund (hereinafter referred to as the "Fund") and
Security Management Company (hereinafter referred to as "SMC") are parties to
an Administrative Services and Transfer Agency Agreement dated April 1, 1987,
as amended January 27, 1989, and July 7, 1989, (the "Administrative Services
Agreement") under which SMC agrees to provide general administrative, fund
accounting, transfer agency, and dividend disbursing services to the Fund in
return for the compensation specified in the Administrative Services Agreement;
and
WHEREAS, on July 27, 1990, the Board of Directors of the Fund voted to amend
the Administrative Services Agreement to provide for payment by the Fund of the
fees of only those directors who are not "interested persons" of the Fund;
NOW THEREFORE, the Fund and SMC hereby amend the Administrative Services
Agreement, dated April 1, 1987, effective July 27, 1990, as follows:
Paragraph 3.B.1. shall be deleted in its entirety and the following
paragraph inserted in lieu thereof:
3. Expenses
B. Direct Expenses
1. Fees and expenses of its directors (including the
fees of those directors who are deemed to be
"interested persons" of the Fund as that term is
defined in the Investment Company Act of 1940) and
the meetings thereof;
IN WITNESS WHEREOF, the parties hereto have made this Amendment to the
Administrative Services Agreement this 27th day of July, 1990.
SECURITY INCOME FUND
By: Xxxxxxx X. Xxxxxxxx, President
------------------------------
Attest:
Xxx X. Xxx, Secretary
---------------------
SECURITY MANAGEMENT COMPANY
By: Xxxxxxx X. Xxxxxxxx, President
------------------------------
Attest:
Xxx X. Xxx, Secretary
---------------------
15
AMENDMENT TO ADMINISTRATIVE
SERVICES AND TRANSFER AGENCY AGREEMENT
WHEREAS, Security Income Fund (the "Fund") and Security Management Company (the
"Management Company") are parties to an Administrative Services and Transfer
Agency Agreement dated April 1, 1987, as amended (the "Administrative
Agreement"), under which the Management Company provides general
administrative, fund accounting, transfer agency and dividend disbursing
services to the Fund in return for the compensation specified in the
Administrative Agreement;
WHEREAS, on October 21, 1994, the Board of Directors of the Fund authorized the
Fund to offer its common stock in a new series designated as the Limited
Maturity Bond Series, in addition to its presently offered series of common
stock of Corporate Bond Series and U.S. Government Series;
WHEREAS, on October 21, 1994, the Board of Directors of the Fund further
authorized the Fund to offer shares of the Limited Maturity Bond Series in two
classes, designated Class A shares and Class B shares; and
WHEREAS, on October 21, 1994, the Board of Directors approved the amendment of
the Administrative Agreement to provide that the Management Company would
provide general administrative, fund accounting, transfer agency, and dividend
disbursing services to each class of the Limited Maturity Bond Series under the
terms and conditions of the Administrative Agreement;
NOW, THEREFORE BE IT RESOLVED, that the Fund and Management Company hereby
amend the Administrative Agreement, to provide that the Management Company
shall provide those administrative and other services described in the
Administrative Contract, and each of the Management Company and the Fund shall
fulfill all of their respective obligations under the
16
Administrative Contract, as to each of the Series of the Fund, including the
Limited Maturity Bond Series of the Fund.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to the
Administrative Agreement this 30th day of December 1994.
SECURITY INCOME FUND
By: Xxxx X. Xxxxxxx
-----------------------------
Xxxx X. Xxxxxxx, President
ATTEST:
Xxx X. Xxx
------------------------------
Xxx X. Xxx, Secretary
SECURITY MANAGEMENT COMPANY
By: Xxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxx X. Xxxxxxxx, President
ATTEST:
Xxx X. Xxx
------------------------------
Xxx X. Xxx, Secretary
17
AMENDMENT TO
ADMINISTRATIVE SERVICES AND TRANSFER AGENCY AGREEMENT
WHEREAS, Security Income Fund (the "Fund") and Security Management Company (the
"Management Company") are parties to an Administrative Services and Transfer
Agency Agreement dated April 1, 1987, as amended (the "Administrative
Agreement"), under which the Management Company provides general
administrative, fund accounting, transfer agency and dividend disbursing
services to the Fund in return for the compensation specified in the
Administrative Agreement;
WHEREAS, on February 3, 1995, the Board of Directors of the Fund authorized the
Fund to offer its common stock in a new series designated as the Global
Aggressive Bond Series, in addition to its presently offered series of common
stock of Corporate Bond Series, Limited Maturity Bond Series and
U.S. Government Series;
WHEREAS, on February 3, 1995, the Board of Directors of the Fund further
authorized the Fund to offer shares of the Global Aggressive Bond Series in two
classes, designated Class A shares and Class B shares; and
WHEREAS, on February 3, 1995, the Board of Directors approved the amendment of
the Administrative Agreement to provide that the Management Company would
provide general administrative, fund accounting, transfer agency, and dividend
disbursing services to each class of the Global Aggressive Bond Series under
the terms and conditions of the Administrative Agreement;
18
NOW, THEREFORE BE IT RESOLVED, that the Fund and Management Company hereby
amend the Administrative Agreement, dated April 1, 1987, as follows, effective
May 1, 1995,
1. Schedule B shall be deleted in its entirety and the attached
Schedule B inserted in lieu thereof.
2. The Administrative Agreement is hereby amended to cover the Global
Aggressive Bond Series of the Fund.
3. Paragraph 7 shall be deleted in its entirety and the following
paragraph inserted in lieu thereof:
Delegation of Duties
The Management Company may, at its discretion, delegate, assign or
subcontract any of the duties, responsibilities and services
governed by this agreement, to its parent company, Security Benefit
Group, Inc., whether or not by formal written agreement, or to any
third party, provided that such arrangement with a third party has
been approved by the Board of Directors of the Fund. The Management
Company shall, however, retain ultimate responsibility to the Fund and
shall implement such reasonable procedures as may be necessary for
assuring that any duties, responsibilities or services so assigned,
subcontracted or delegated are performed in conformity with the terms
and conditions of this agreement.
19
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to the
Administrative Agreement this 28th day of April, 1995.
SECURITY INCOME FUND
By: Xxxx X. Xxxxxxx
--------------------------------
Xxxx X. Xxxxxxx, President
ATTEST:
Xxx X. Xxx
-------------------------
Xxx X. Xxx, Secretary
SECURITY MANAGEMENT COMPANY
By: Xxxxxxx X. Xxxxxxxx
--------------------------------
Xxxxxxx X. Xxxxxxxx, President
ATTEST:
Xxx X. Xxx
-------------------------
Xxx X. Xxx, Secretary
20
SECURITY INCOME FUND ADMINISTRATIVE SERVICES
AND TRANSFER AGENCY AGREEMENT
SCHEDULE B
The following charges apply to all Series of Security Income Fund:
Maintenance Fee: $8.00 per account
Transaction Fee: $1.00
Dividend Fee: $1.00
Annual Administration Fee: 0.45% (based on daily net asset value)
The following charges apply only to Global Aggressive Bond Series of the
Security Income Fund: Global Administration Fee: In addition to the above
fees, Global Aggressive Bond Series shall pay an annual fee equal to the
greater of .10 percent of its average net assets or (i) $30,000 in the year
ending April 29, 1996; (ii) $45,000 in the year ending April 29, 1997; and
(iii) $60,000 thereafter. If this Agreement shall terminate before the last
day of a month, compensation for that part of the month this Agreement is in
effect shall be prorated in a manner consistent with the calculation of the
fees set forth above.
