SSI Investment Management LLC

Item 5.           Fees And Compensation

The fees and billing periods for SSI’s different strategies are listed below and are based on annual
percentages. SSI’s separate account advisory agreements may be terminated by either party at any
time, and the termination is effective normally five business days after receipt of written notice to
the other party and in accordance with its investment management agreement. In the event of
termination, fees are refunded on a pro rata basis to the date of termination.

     STRATEGY            MINIMUM                   BILLING      PERIOD                          FEE     SCHEDULE
                       INVESTMENT               BASE             PERFORMANCE           BASE              PERFORMANCE
 Balanced /               $500,000        Semiannually in             N/A      1.00% Annually                 N/A
 Core Equity           separate account   Advance,                             Based on Equity at the
  Separate Account                                                             Beginning of the
                                          June 1st-Nov. 30th                   Billing Period
                                          Dec. 1st-May 31st
 Hedged Convertible      $10,000,000      Quarterly In              N/A        0.85% Annually                N/A
 Income                separate account   Advance                              Based on Equity at the
  Separate Account                                                             Beginning of the
                                          Jan. 1st-March 31st                  Billing Period
                                          Apr. 1st-June 30th
                                          July 1st-Sept. 30th
                                          Oct. 1st-Dec. 31st
 Hedged Convertible      $10,000,000      Quarterly In               N/A       0.85% Annually                N/A
 Opportunity           separate account   Advance                              based on equity at the
  Separate Account                                                             beginning of the
                                          Jan. 1st-March 31st                  billing period
                                          Apr. 1st-June 30th
                                          July 1st-Sept. 30th
                                          Oct. 1st-Dec. 31st
 Flexible Allocation     $1,000,000       Quarterly in               N/A       1.00% Annually fixed          N/A
  Separate Account     separate account   advance                              based on equity at the
                                                                               beginning of the
                                          Jan. 1st-March 31st                  billing period
                                          Apr. 1st-June 30th
                                          July 1st-Sept. 30th
                                          Oct. 1st-Dec. 31st

 Convertible             $3,000,000       Quarterly In              N/A        Annually 1%                   N/A
 Investment /          separate account   Arrears                              computed on the
 Investment Grade                                                              average of the (3)
 Convertible                              Jan. 1st-March 31st                  months ending
  Separate Account                        Apr. 1st-June 30th                   valuation
                                          July 1st-Sept. 30th
                                          Oct. 1st-Dec. 31st

SSI may deduct management fees directly from client accounts or may bill a client for such
amounts on request.

SSI may invest or recommend investments in mutual funds or exchange-traded funds including
funds that are managed by SSI. Clients investing in mutual funds or exchange-traded funds will
also bear, indirectly as fund shareholders, their proportionate share of the fund’s internal expenses,
which include management fees paid to the fund’s adviser. These internal fees and charges are

known as the fund’s expense ratio. Each fund’s expense ratio will vary over time and is disclosed
in its prospectus. SSI does not receive sales charges from mutual funds or exchange-traded funds
as a result of recommending such securities.

To the extent that SSI invests client accounts in a fund managed by SSI, SSI will not charge its
management fee on the amount invested to avoid duplication of its management fee through the
fund. SSI instead receives a management fee described above directly from the Fund.

SSI believes that its fees are competitive with fees charged by other investment advisers for
comparable services. Comparable services may be available from other sources for lower fees.

The disclosure in this Item 5, together with the disclosure in Item 12, allow a plan that is subject
to the Employee Retirement Income Security Act of 1974 to use the “alternative reporting option”
to report SSI’s compensation as “eligible indirect compensation” on the Schedule C of the plan’s
Form 5500 Annual Return/Report of Employee Benefit Plan.

In all cases, the pro rata portion of the management fee through the date of termination are charged
to the account. All prepaid but unearned advisory fees are refunded on termination of a client’s
account.

Each account is responsible for its own costs and expenses, including trading costs and expenses
(such as brokerage commissions, expenses related to short sales, and clearing and settlement
charges), ongoing legal, accounting and bookkeeping fees and expenses, and the fees and expenses
charged by any fund administrator for its accounting, bookkeeping and other services. SSI bears
its own operating, general, administrative and overhead costs and expenses, other than the
expenses described above.

Item 7.        Types of Clients

SSI provides investment advice to registered investment companies, institutions, trusts,
endowments, foundation, pension plans, and high net worth individuals. SSI generally requires a
minimum of $3 to $10 million to open an individually managed account but may waive this
minimum.