<PAGE>
                                                                    EXHIBIT 99.3

                               [ZURICH LETTERHEAD]



November 1, 2002


Berthel Growth & Income Trust
701 Tama St.
Marion, IA 52302


Re: Bond/Policy No. FIB 0005569 00

Dear Insured:


Acting upon your application, we offer you the enclosed bond/policy. The
coverages, limits and deductibles provided by the bond/policy may vary from
those requested in your application. If there are differences in coverages,
limits, or deductibles, these differences are a result of the negotiations we
had in developing your bonding and/or insurance program, and they supersede what
was requested in your application.

By retaining the bond/policy and paying the premium billed, you have accepted
this offer of coverage as established by the enclosed bond/policy.



Yours sincerely,
Zurich NA Financial Enterprises



/s/ CHARLES M. COOK


Charles M. Cook
Assistant Vice President
<PAGE>
[THE F & D COMPANIES LOGO]








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                           FINANCIAL INSTITUTION BOND
                              STANDARD FORM NO. 14
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                                                               THE F&D COMPANIES
                                                                   P.O. BOX 1227
                                                             BALTIMORE, MD 21203

<PAGE>

[THE F & D COMPANIES LOGO]                                   Home Office
                                                             P.O. Box 1227
                                                             Baltimore, MD 21203


                           FINANCIAL INSTITUTION BOND
                 Standard Form No. 14, Revised to October, 1987

                    FIDELITY AND DEPOSIT COMPANY OF MARYLAND
                          (Herein called Underwriter)

DECLARATIONS                                             Bond No. FIB 0005569 00


ITEM 1.  Name of Insured (herein called Insured):
         Berthel Growth & Income Trust
         Berthel SBIC, LLC


         Principal Address:

         701 Tama St.
         Marion                          IA      52302
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ITEM 2.  Bond Period: from 12:01 a.m. 11-01-02    to 12:01 a.m. 11-01-03
         standard time at the Principal Address shown in Item 1. above.
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ITEM 3.  The Aggregate Liability of the Underwriter during the Bond Period shall
         be $    1,000,000
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ITEM 4.  Subject to Sections 4. and 11. hereof,
         the Single Loss Limit of Liability is      $ 1,000,000
         and the Single Loss Deductible is          $         0

         Provided, however, that if any amounts are inserted below opposite
         specified Insuring Agreements or Coverage, those amounts shall be
         controlling. Any amount set forth below shall be part of and not in
         addition to amounts set forth above. (If an Insuring Agreement or
         Coverage is to be deleted, insert "Not Covered.")

         Amount applicable to:                Single Loss          Single Loss
                                           Limit of Liability      Deductible

         Insuring Agreement
           (D)-FORGERY OR ALTERATION       $   1,000,000         $           0
         Insuring Agreement
           (E)-SECURITIES                  $   1,000,000         $           0
         Coverage on Partners              $ NOT COVERED         $ NOT COVERED
         Optional Insuring Agreements
           and Coverages:

         If "Not Covered" is inserted above opposite any specified Insuring
         Agreement or Coverage, such Insuring Agreement or Coverage and any
         other reference thereto in this bond shall be deemed to be deleted
         therefrom.
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Item 5.  The liability of the Underwriter is subject to the terms of the
         following riders attached hereto: SR6100(e)

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Item 6.  The Insured by the acceptance of this bond gives notice to the
         Underwriter terminating or canceling prior bond(s) or policy(ies)
         No.(s) NA                    such termination or cancelation to be
         effective as of the time this bond becomes effective.
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                          Countersigned by:
                                           -------------------------------------
                                               Authorized Representative

TSB5062b (F4725b)
Financial Institution Bond,
Standard Fern No. 14
Revised to October, 1987

                               FIB14 Page 1 of 8
                                     INSURED
<PAGE>
     The Underwriter, in consideration of an agreed premium, and in reliance
upon all statements made and information furnished to the Underwriter by the
Insured in applying for this bond, and subject to the Declarations, Insuring
Agreements, General Agreements, Conditions and Limitations and other terms
hereof, agrees to indemnify the Insured for:

                              INSURING AGREEMENTS

                                    FIDELITY

     (A) Loss resulting directly from dishonest or fraudulent acts committed by
an Employee acting alone or in collusion with others.

          Such dishonest or fraudulent acts must be committed by the Employee
with the manifest intent:

          (a) to cause the Insured to sustain such loss; and
          (b) to obtain financial benefit for the Employee and which, in fact,
              result in obtaining such benefit.

          As used in this Insuring Agreement, financial benefit does not
include any employee benefits earned in the normal course of employment,
including: salaries, commissions, fees, bonuses, promotions, awards, profit
sharing or pensions.

                                  ON PREMISES

     (B)  (1) Loss of Property resulting directly from

              (a)  robbery, burglary, misplacement, mysterious unexplainable
                   disappearance and damage thereto or destruction thereof, or
              (b)  theft, false pretenses, common-law or statutory larceny,
                   committed by a person present in an office or on the premises
                   of the Insured,

              while the Property is lodged or deposited within offices or
              premises located anywhere.

          (2) Loss of or damage to

              (a)  furnishings, fixtures, supplies or equipment within an office
                   of the Insured covered under this bond resulting directly
                   from larceny or theft in, or by burglary or robbery of, such
                   office, or attempt thereat, or by vandalism or malicious
                   mischief, or
              (b)  such office resulting from larceny or theft in, or by
                   burglary or robbery of such office or attempt thereat, or to
                   the interior of such office by vandalism or malicious
                   mischief,

              provided that

                   (i)  the Insured is the owner of such furnishings, fixtures,
                        supplies, equipment, or office or is liable for such
                        loss or damage, and
                   (ii) the loss is not caused by fire.

                                   IN TRANSIT

     (C) Loss of Property resulting directly from robbery, common-law or
statutory larceny, theft, misplacement, mysterious unexplainable disappearance,
being lost or made away with, and damage thereto or destruction thereof, while
the Property is in transit anywhere in the custody of

          (a) a natural person acting as a messenger of the Insured (or another
              natural person acting as messenger or custodian during an
              emergency arising from the incapacity of the original messenger),
              or
          (b) a Transportation Company and being transported in an armored motor
              vehicle, or
          (c) a Transportation Company and being transported in a conveyance
              other than an armored motor vehicle provided that covered Property
              transported in such manner is limited to the following:

              (i)   records, whether recorded in writing or electronically, and
              (ii)  Certificated Securities issued in registered form and not
                    endorsed. or with restrictive endorsements, and
              (iii) Negotiable Instruments not payable to bearer, or not
                    endorsed, or with restrictive endorsements.

     Coverage under this Insuring Agreement begins immediately upon the receipt
of such Property by the natural person or Transportation Company and ends
immediately upon delivery to the designated recipient or its agent.

                              FORGERY OR ALTERATION

     (D) Loss resulting directly from

     (1) Forgery or alteration of, on or in any Negotiable Instrument (except an
Evidence of Debt), Acceptance, Withdrawal Order, receipt for the withdrawal of
Property, Certificate of Deposit or Letter of Credit,
     (2) transferring, paying or delivering any funds or Property or
establishing any credit or giving any value on the faith of any written
instructions or advices directed to the Insured and authorizing or acknowledging
the transfer, payment, delivery or receipt of funds or Property, which
instructions or advices purport to have been signed or endorsed by any customer
of the Insured or by any financial institution but which instructions or advices
either bear a signature which is a Forgery or have been altered without the
knowledge and consent of such customer or financial institution.

     A mechanically reproduced facsimile signature is treated the same as a
handwritten signature.

                                   SECURITIES

     (E) Loss resulting directly from the Insured having, in good faith, for its
own account or for the account of others,
          (1) acquired, sold or delivered, or given value, extended credit or
assumed liability, on the faith of any original

          (a) Certificated Security,
          (b) deed, mortgage or other instrument conveying title to, or creating
              or discharging a lien upon, real property,
          (c) Evidence of Debt,
          (d) Instruction to a Federal Reserve Bank of the United States, or
          (e) Statement of Uncertificated Security of any Federal Reserve Bank
              of the United States

which

              (i)   bears a signature of any maker, drawer, issuer, endorser,
                    assignor, lessee, transfer agent, registrar, acceptor,
                    surety, guarantor, or of any person signing in any other
                    capacity which is a Forgery, or
              (ii)  is altered, or
              (iii) is lost or stolen;

          (2) guaranteed in writing or witnessed any signature upon any
transfer, assignment, bill of sale, power of attorney, Guarantee, or any items
listed in (a) through (c) above;

          (3) acquired, sold or delivered, or given value, extended credit or
assumed liability, on the faith of any item listed in (a) and (b) above which is
a Counterfeit

     A mechanically reproduced facsimile signature is treated the same as a
handwritten signature.

                              COUNTERFEIT CURRENCY

     (F) Loss resulting directly from the receipt by the Insured, in good faith,
of any Counterfeit Money of the United States of America, Canada or of any other
country in which the Insured maintains a branch office.

                               GENERAL AGREEMENTS

                                    NOMINEES

     A. Loss sustained by any nominee organized by the Insured for the purpose
of handling certain of its business transactions and composed exclusively of its
Employees shall, for all the purposes of this bond and whether or not any
partner of such

                               FIB14 Page 2 of 8
<PAGE>
nominee is implicated in such loss, be deemed to be loss sustained by the
Insured.

                 ADDITIONAL OFFICES OR EMPLOYEES--CONSOLIDATION,
                      MERGER OR PURCHASE OF ASSETS--NOTICE

     B. If the Insured shall, while this bond is in force, establish any
additional offices, other than by consolidation or merger with, or purchase or
acquisition of assets or liabilities of, another institution, such offices shall
be automatically covered hereunder from the date of such establishment without
the requirement of notice to the Underwriter or the payment of additional
premium for the remainder of the premium period.

     If the Insured shall, while this bond is in force, consolidate or merge
with, or purchase or acquire assets or liabilities of, another institution, the
Insured shall not have such coverage as is afforded under this bond for loss
which

     (a)  has occurred or will occur in offices or premises, or

     (b)  has been caused or will be caused by an employee or employees of such
          institution, or

     (c)  has arisen or will arise out of the assets or liabilities acquired by
          the Insured all a result of such consolidation, merger or purchase or
          acquisition of assets or liabilities unless the Insured shall

          (i)   give the Underwriter written notice of the proposed
                consolidation, merger or purchase or acquisition of assets or
                liabilities prior to the proposed effective date of such action
                and

          (ii)  obtain the written consent of the Underwriter to extend the
                coverage provided by this bond to such additional offices or
                premises, Employees and other exposures, and

          (iii) upon obtaining such consent, pay to the Underwriter an
                additional premium.

                            CHANGE OF CONTROL--NOTICE

     C. When the Insured learns of a change in control, it shall give written
notice to the Underwriter.

     As used in this General Agreement, control means the power to determine the
management or policy of a controlling holding company or the Insured by virtue
of voting stock ownership. A change in ownership of voting stock which results
in direct or indirect ownership by a stockholder or an affiliated group of
stockholders of ten percent (10%) or more of such stock shall be presumed to
result in a change of control for the purpose of the required notice.

     Failure to give the required notice shall result in termination of coverage
for any loss involving a transferee, to be effective upon the date of the stock
transfer.

                           REPRESENTATION OF INSURED

     D. The Insured represents that the information furnished in the application
for this bond is complete, true and correct. Such application constitutes part
of this bond.

     Any misrepresentation, omission, concealment or incorrect statement of a
material fact, in the application or otherwise, shall be grounds for the
rescission of this bond.

                                 JOINT INSURED

     E. If two or more Insureds are covered under this bond, the first named
Insured shall act for all Insureds. Payment by the Underwriter to the first
named Insured of loss sustained by any Insured shall fully release the
Underwriter on account of such loss. If the first named Insured ceases to be
covered under this bond, the Insured next named shall thereafter be considered
as the first named Insured. Knowledge possessed or discovery made by any
Insured shall constitute knowledge or discovery by all Insureds for all purposes
of this bond. The liability of the Underwriter for loss or losses sustained by
all Insureds shall not exceed the amount for which the Underwriter would have
been liable had all such loss or losses been sustained by one Insured.

         NOTICE OF LEGAL PROCEEDINGS AGAINST INSURED--ELECTION TO DEFEND

     F. The Insured shall notify the Underwriter at the earliest practicable
moment, not to exceed 30 days after notice thereof, of any legal proceeding
brought to determine the Insured's liability for any loss, claim or damage,
which, if established, would constitute a collectible loss under this bond.
Concurrently, the Insured shall furnish copies of all pleadings and pertinent
papers to the Underwriter.

     The Underwriter, at its sole option, may elect to conduct the defense of
such legal proceeding, in whole or in part. The defense by the Underwriter shall
be in the Insured's name through attorneys selected by the Underwriter. The
Insured shall provide all reasonable information and assistance required by the
Underwriter for such defense.

     If the Underwriter elects to defend the Insured, in whole or in part, any
judgment against the Insured on those counts or causes of action which the
Underwriter defended on behalf of the Insured or any settlement in which the
Underwriter participates and all attorneys' fees, costs and expenses incurred by
the Underwriter in the defense of the litigation shall be a loss covered by this
bond.

     If the Insured does not give the notices required in subsection (a) of
Section 5 of this bond and in the first paragraph of this General Agreement, or
if the Underwriter elects not to defend any causes of action, neither a judgment
against the Insured, nor a settlement of any legal proceeding by the Insured,
shall determine the existence, extent or amount of coverage under this bond for
loss sustained by the Insured, and the Underwriter shall not be liable for any
attorneys' fees, costs and expenses incurred by the Insured.

     With respect to this General Agreement, subsections (b) and (d) of Section
5 of this bond apply upon the entry of such judgment or the occurrence of such
settlement instead of upon discovery of loss. In addition, the Insured must
notify the Underwriter within 30 days after such judgment is entered against it
or after the Insured settles such legal proceeding, and, subject to subsection
(e) of Section 5, the Insured may not bring legal proceedings for the recovery
of such loss after the expiration of 24 months from the date of such final
judgment or settlement.

                           CONDITIONS AND LIMITATIONS

                                   DEFINITIONS

Section 1. As used in this bond:

     (a) Acceptance means a draft which the drawee has, by signature written
thereon, engaged to honor all presented.
     (b) Certificate of Deposit means an acknowledgment in writing by a
financial institution of receipt of Money with an engagement to repay it.
     (c) Certificated Security means a share, participation or other interest in
property of or an enterprise of the issuer or an obligation of the issuer, which
is:

          (1)  represented by an instrument issued in bearer or registered
               form;
          (2)  of a type commonly dealt in on securities exchanges or markets or
               commonly recognized in any area in which it is issued or dealt in
               as a medium for investment; and
          (3)  either one of a class or series or by its terms divisible into a
               class or series of shares, participations, interests or
               obligations.

     (d) Counterfeit means an imitation of an actual valid original which is
intended to deceive and to be taken as the original.
     (e)  Employee means

          (1)  a natural person in the service of the Insured at any of the
               Insured's offices or premises covered

                               FIB14 Page 3 of 8
<PAGE>
               hereunder whom the Insured compensates directly by salary or
               commissions and whom the Insured has the right to direct and
               control while performing services for the Insured;
          (2)  an attorney retained by the Insured and an employee of such
               attorney while either is performing legal services for the
               Insured:
          (3)  a person provided by an employment contractor to perform employee
               duties for the Insured under the Insured's supervision at any of
               the Insured's offices or premises covered hereunder; and a guest
               student pursuing studies or duties in any of said offices or
               premises;
          (4)  an employee of an institution merged or consolidated with the
               Insured prior to the effective date of this bond;
          (5)  each natural person, partnership or corporation authorized by the
               Insured to perform services as data processor of checks or other
               accounting records of the Insured (not including preparation or
               modification of computer software or programs), herein called
               Processor. (Each such Processor, and the partners, officers and
               employees of such Processor shall, collectively, be deemed to be
               one Employee for all the purposes of this bond, excepting,
               however, the second paragraph of Section 12. A Federal Reserve
               Bank or clearing house shall not be construed to be a processor.)
               and
          (6)  a Partner of the Insured, unless not covered as stated in Item 4
               of the Declarations.

     (f) Evidence of Debt means an instrument, including a Negotiable
Instrument, executed by a customer of the Insured and held by the Insured which
in the regular course of business is treated as evidencing the customer's debt
to the Insured.

     (g) Financial Interest in the Insured of the Insured's general partner(s),
or limited partner(s), committing dishonest or fraudulent acts covered by this
bond or concerned or implicated therein means:

          (1)  all respects general partners the value of all right, title and
               interest of such general partner(s), determined as of the close
               of business on the date of discovery of loss covered by this
               bond, in the aggregate of:

               (a) the "net worth" of the Insured, which for the purposes of
                   this bond, shall be deemed to be the excess of its total
                   assets over its total liabilities, without adjustment to give
                   effect to loss covered by this bond, (except that credit
                   balances and equities in proprietary accounts of the Insured,
                   which shall include capital accounts of partners, investment
                   and trading accounts of the Insured, participations of the
                   Insured in joint accounts, and accounts of partners which are
                   covered by agreements providing for the inclusion of equities
                   therein as partnership property, shall not be considered as
                   liabilities) with securities, spot commodities, commodity
                   future contracts in such proprietary accounts and all other
                   assets marked to market or fair value and with adjustment for
                   profits and losses at the market of contractual commitments
                   for such proprietary accounts of the Insured; and
               (b) the value of all other Money, securities and property
                   belonging to such general partner(s), or in which such
                   general partner(s) have a pecuniary interest, held by or in
                   the custody of and legally available to the Insured as
                   set-off against loss covered by this bond;

          provided, however, that if such "net worth" adjusted to give effect to
          loss covered by this bond and such value of all other Money,
          securities and property as set forth in (g)(1)(b) preceding, plus the
          amount of coverage afforded by this bond on account of such loss, is
          not sufficient to enable the Insured to meet its obligations,
          including its obligations to its partners other than to such general
          partner(s), then the Financial Interest in the Insured, as above
          defined, of such general partner(s) shall be reduced in an amount
          necessary, or eliminated if need be, in order to enable the Insured
          upon payment of loss under this bond to meet such obligations, to the
          extent that such payment will enable the Insured to meet such
          obligations, without any benefit accruing to such general partner(s)
          from such payment; and

          (2)  as respects limited partners the value of such limited
               partner's(') investment in the Insured.

     (h) Forgery means the signing of the name of another person or organization
with intent to deceive; it does not mean a signature which consists in whole or
in part of one's own name signed with or without authority, in any capacity, for
any purpose.

     (i) Guarantee means a written undertaking obligating the signer to pay the
debt of another to the Insured or its assignee or to a financial institution
from which the Insured has purchased participation in the debt, if the debt is
not paid in accordance with its terms.

     (j) Instruction means a written order to the issuer of an Uncertificated
Security requesting that the transfer, pledge, or release from pledge of the
Uncertificated Security specified be registered.

     (k) Letter of Credit means an engagement in writing by a bank or other
person made at the request of a customer that the bank or other person will
honor drafts or other demands for payment upon compliance with the conditions
specified in the Letter of Credit.

     (1) Money means a medium of exchange in current use authorized or adopted
by a domestic or foreign government as a part of its currency.

     (m) Negotiable Instrument means any writing

          (1)  signed by the maker or drawer
          (2)  containing any unconditional promise or order to pay a sum
               certain in Money and no other promise, order, obligation or power
               given by the maker or drawer; and
          (3)  is payable on demand or at a definite time; and
          (4)  is payable to order or bearer.

     (n) Partner means a natural person who

          (1)  is a general partner of the Insured, or
          (2)  is a limited partner and an Employee (as defined in Section 1 (e)
               (1) of the bond) of the Insured.

     (o) Property means Money, Certificated Securities, Uncertificated
Securities of any Federal Reserve Bank of the United States, Negotiable
Instruments, Certificates of Deposit, documents of title, Acceptances, Evidences
of Debt, security agreements, Withdrawal Orders, certificates of origin or
title, Letters of Credit, insurance policies, abstracts of title, deeds and
mortgages on real estate, revenue and other stamps, tokens, unsold state lottery
tickets, books of account and other records whether recorded in writing or
electronically, gems, jewelry, precious metals of all kinds and in any form, and
tangible items of personal property which are not hereinbefore enumerated.

     (p) Statement of Uncertificated Security means a written statement of the
issuer of an Uncertificated Security containing:

          (1)  a description of the Issue of which the Uncertificated Security
               is a part;
          (2)  the number of shares or units:

               (a) transferred to the registered owner;
               (b) pledged by the registered owner to the registered pledgee;
               (c) released from pledge by the registered pledgee;
               (d) registered in the name of the registered owner on the date of
                   the statement; or
               (e) subject to pledge on the date of the statement;

          (3)  the name and address of the registered owner and registered
               pledgee;

                               FIB14 Page 4 of 8

<PAGE>
          (4)  a notation of any liens and restrictions of the issuer and any
               adverse claims to which the Uncertificated Security is or may be
               subject or a statement that there are none of those liens,
               restrictions or adverse claims; and

          (5)  the date:

               (a) the transfer of the shares or units to the new registered
                   owner of the shares or units was registered;
               (b) the pledge of the registered pledgee was registered, or
               (c) of the statement, if it is a periodic or annual statement.

     (q) Transportation Company means any organization which provides its own or
leased vehicles for transportation or which provides freight forwarding or air
express services.

     (r) Uncertificated Security means a share, participation or other interest
in property of or an enterprise of the issuer or an obligation of the issuer,
which is:

          (1)  not represented by an instrument and the transfer of which is
               registered upon books maintained for that purpose by or on behalf
               of the issuer;
          (2)  of a type commonly dealt in on securities exchanges or markets;
               and
          (3)  either one of a class or series or by its terms divisible into a
               class or series of shares, participations, interests or
               obligations.

     (s) Withdrawal Order means a non-negotiable instrument, other than an
Instruction, signed by a customer of the Insured authorizing the Insured to
debit the customer's account in the amount of funds stated therein.

                                   EXCLUSIONS

Section 2. This bond does not cover:

     (a) loss resulting directly or indirectly from forgery or alteration,
except when covered under Insuring Agreements (A), (D) or (E);

     (b) loss due to riot or civil commotion outside the United States of
America and Canada; or loss due to military, naval or usurped power, war or
insurrection unless such loss occurs in transit in the circumstances recited in
Insuring Agreement (C), and unless, when such transit was initiated, there was
no knowledge of such riot, civil commotion, military, naval or usurped power,
war or insurrection on the part of any person acting for the Insured initiating
such transit;

     (c) loss resulting directly or indirectly from the effects of nuclear
fission or fusion or radioactivity; provided, however, that this paragraph shall
not apply to loss resulting from industrial uses of nuclear energy;

     (d) loss resulting from any act or acts of any person who is a member of
the Board of Directors of the Insured or a member of any equivalent body by
whatsoever name known unless such person is also an Employee or an elected
official of the Insured in some other capacity, nor, in any event, loss
resulting from the act or acts of any person while acting in the capacity of a
member of such Board or equivalent body;

     (e) loss resulting directly or indirectly from the complete or partial
non-payment of, or default upon, any loan or transaction involving the Insured
as a lender on borrower, or extension of credit, including the purchase,
discounting or other acquisition of false or genuine accounts, invoices, notes,
agreements or Evidences of Debt, whether such loan, transaction or extension was
procured in good faith or through trick, artifice, fraud or false pretenses;
except when covered under Insuring Agreements (A), (D) or (E);

     (f) loss resulting from any violation by the Insured or by any Employee

          (1)  of law regulating (i) the issuance, purchase or sale of
               securities, (ii) securities transactions upon security exchanges
               or over the counter market, (iii) investment companies, or (iv)
               investment advisers, or
          (2)  of any rule or regulation made pursuant to any such law, unless
               it is established by the Insured that the act or acts which
               caused the said loss involved fraudulent or dishonest conduct
               which would have caused a loss to the Insured in a similar amount
               in the absence of such laws, rules or regulations;

     (g) loss resulting directly or indirectly from the failure of a financial
or depository institution, or its receiver or liquidator, to pay or deliver, on
demand of the Insured, funds or Property of the Insured held by it in any
capacity, except when covered under Insuring Agreements (A) or (B)(1)(a);

     (h) loss caused by an Employee, except when covered under Insuring
Agreement (A) or when covered under Insuring Agreement (B) or (C) and resulting
directly from misplacement, mysterious unexplainable disappearance or
destruction of or damage to Property;

     (i) loss resulting directly or indirectly from transactions in a customer's
account, whether authorized or unauthorized, except the unlawful withdrawal and
conversion of Money, securities or precious metals, directly from a customer's
account by an Employee provided such unlawful withdrawal and conversion is
covered under Insuring Agreement (A);

     (j) damages resulting from any civil, criminal or other legal proceeding in
which the Insured is alleged to have engaged in racketeering activity except
when the Insured establishes that the act or acts giving rise to such damages
were committed by an Employee under circumstances which result directly in a
loss to the Insured covered by Insuring Agreement (A). For the purposes of this
exclusion, "racketeering activity" is defined in 18 United States Code 1961 et
seq., all amended;

     (k) loss resulting directly or indirectly from the use or purported use of
credit, debit, charge, access, convenience, identification, cash management or
other cards

          (1)  in obtaining credit or funds, or
          (2)  in gaining access to automated mechanical devices which, on
               behalf of the Insured, disburse Money, accept deposits, cash
               checks, drafts or similar written instruments or make credit card
               loans, or
          (3)  in gaining access to point of sale terminals, customer-bank
               communication terminals, or similar electronic terminals of
               electronic funds transfer systems,

whether such cards were issued, or purport to have been issued, by the Insured
or by anyone other than the Insured, except when covered under Insuring
Agreement (A);

     (1) loss involving automated mechanical devices which, on behalf of the
Insured, disburse Money, accept deposits, cash checks, drafts or similar written
instruments or make credit card loans, except when covered under Insuring
Agreement (A);

     (m) loss through the surrender of Property away from an office of the
Insured as a result of a threat

          (1)  to do bodily harm to any person, except loss of Property in
               transit in the custody of any person acting all messenger
               provided that when such transit was initiated there was no
               knowledge by the Insured of any such threat, or
          (2)  to do damage to the premises or property of the Insured, except
               when covered under Insuring Agreement (A);

     (n) loss resulting directly or indirectly from payments made or withdrawals
from a depositor's or customer's account involving erroneous credits to such
account, unless such payments or withdrawals are physically received by such
depositor or customer or representative of such depositor or customer who is
within the office of the Insured at the time of such payment or withdrawal, or
except when covered under Insuring Agreement (A);

     (o) loss involving items of deposit which are not finally paid for any
reason, including but not limited to Forgery or any other fraud, except when
covered under Insuring Agreement (A);

     (p) loss resulting directly or indirectly from counterfeiting, except when
covered under Insuring Agreements (A), (E), or (F);

                               FIB14 Page 5 of 8


<PAGE>
     (q) loss of any tangible item of personal property which is not
specifically enumerated in the paragraph defining Property if such property is
specifically insured by other insurance of any kind and in any amount obtained
by the Insured, and in any event, loss of such property occurring more than 60
days after the Insured takes possession of such property, except when covered
under Insuring Agreements (A) or (B)(2);

     (r) loss of Property while

          (1)  in the mail, or
          (2)  in the custody of any Transportation Company, unless covered
               under Insuring Agreement (C),

except when covered under Insuring Agreement (A);

     (s) potential income, including but not limited to interest and dividends,
not realized by the Insured or by any customer of the Insured;

     (t) damages of any type for which the Insured is legally liable, except
compensatory damages, but not multiples thereof, arising directly from a loss
covered under this bond;

     (u) all fees, costs and expenses incurred by the Insured

          (1)  in establishing the existence of or amount of loss covered under
               this bond, or
          (2)  as a party to any legal proceeding whether or not such legal
               proceeding exposes the Insured to loss covered by this bond;

     (v) indirect or consequential loss of any nature;

     (w) loss involving any Uncertificated Security except an Uncertificated
Security of any Federal Reserve Bank of the United States or when covered under
Insuring Agreement (A);

     (x) loss resulting directly or indirectly from any dishonest or fraudulent
act or acts committed by any non-Employee who is a securities, commodities,
money, mortgage, real estate, loan, insurance, property management, investment
banking broker, agent or other representative of the same general character;

     (y) loss caused directly or indirectly by a Partner of the Insured unless
the amount of such loss exceeds the Financial Interest in the Insured of such
Partner and the Deductible Amount applicable to this bond, and then for the
excess only;

     (z) loss resulting directly or indirectly from any actual or alleged
representation, advice, warranty or guarantee as to the performance of any
investments;

     (aa) loss due to liability imposed upon the Insured as a result of the
unlawful disclosure of non-public material information by the Insured or any
Employee, or as a result of any Employee acting upon such information, whether
authorized or unauthorized.

                                    DISCOVERY

Section 3. This bond applies to loss discovered by the Insured during the Bond
Period. Discovery occurs when the Insured first becomes aware of facts which
would cause a reasonable person to assume that a loss of a type covered by this
bond has been or will be incurred, regardless of when the act or acts causing or
contributing to such loss occurred, even though the exact amount or details of
loss may not then be known.

     Discovery, also occurs when the Insured receives notice of an actual or
potential claim in which it is alleged that the Insured is liable to a third
party under circumstances which, if true, would constitute a loss under this
bond.

                               LIMIT OF LIABILITY

Section 4.

                          Aggregate Limit of Liability

     The Underwriter's total liability for all losses discovered during the Bond
Period shown in Item 2 of the Declarations shall not exceed the Aggregate Limit
of Liability shown in Item 3 of the Declarations: The Aggregate Limit of
Liability shall be reduced by the amount of any payment made under the terms of
this bond.

Upon exhaustion of the Aggregate Limit of Liability by such payments:

          (a)  The Underwriter shall have no further liability for loss or
               losses regardless of when discovered and whether or not
               previously reported to the Underwriter, and
          (b)  The Underwriter shall have no obligation under General Agreement
               F to continue the defense of the Insured, and upon notice by the
               Underwriter to the Insured that the Aggregate Limit of Liability
               has been exhausted, the Insured shall assume all responsibility
               for its defense at its own cost.

     The Aggregate Limit of Liability shall not be increased or reinstated by
any recovery made and applied in accordance with subsections (a), (b) and (c) of
Section 7. In the event that a loss of Property is settled by the Underwriter
through the use of a lost instrument bond, such loss shall not reduce the
Aggregate Limit of Liability.

                         Single Loss Limit of Liability

     Subject to the Aggregate Limit of Liability, the Underwriter's liability
for each Single Loss shall not exceed the applicable Single Loss Limit of
Liability shown in Item 4 of the Declarations. If a Single Loss is covered under
more than one Insuring Agreement or Coverage, the maximum payable shall not
exceed the largest applicable Single Loss Limit of Liability.

                              Single Loss Defined

     Single Loss means all covered loss, including court costs and attorneys'
fees incurred by the Underwriter under General Agreement F, resulting from

          (a)  any one act or series of related acts of burglary, robbery or
               attempt thereat, in which no Employee is implicated, or
          (b)  any one act or series of related unintentional or negligent acts
               or omissions on the part of any person (whether an Employee or
               not) resulting in damage to or destruction or misplacement of
               Property, or
          (c)  all acts or omissions other than those specified in (a) and (b)
               preceding, caused by any person (whether an Employee or not) or
               in which such person is implicated, or
          (d)  any one casualty or event not specified in (a), (b) or (c)
               preceding.

               NOTICE/PROOF-LEGAL PROCEEDINGS AGAINST UNDERWRITER

     Section 5.

     (a) At the earliest practicable moment, not to exceed 30 days, after
discovery of loss, the Insured shall give the Underwriter notice thereof.

     (b) Within 6 months after such discovery, the Insured shall furnish to the
Underwriter proof of loss, duly sworn to, with full particulars.

     (c) Lost Certificated Securities listed in a proof of loss shall be
identified by certificate or bond numbers if such securities were issued
therewith.

     (d) Legal proceedings for the recovery of any loss hereunder shall not be
brought prior to the expiration of 60 days after the original proof of loss is
filed with the Underwriter or after the expiration of 24 months from the
discovery of such loss.

     (e) If any limitation embodied in this bond is prohibited by any law
controlling the construction hereof, such limitation shall be deemed to be
amended so as to equal the minimum period of limitation provided by such law.

     (f) This bond affords coverage only in favor of the Insured. No suit,
action or legal proceedings shall be brought hereunder by any one other than the
named Insured.

                                    VALUATION

     Section 6. Any loss of Money, or loss payable in Money, shall be paid, at
the option of the Insured, in the Money of the country in which the loss was
sustained or in the United States of America dollar equivalent thereof
determined at the rate of exchange at the time of payment of such loss.

                                   Securities

     The Underwriter shall settle in kind its liability under thus bond on
account of a loss of any securities or, at the option of the

                                FIBI4 Page 6 of 8
<PAGE>
Insured, shall pay to the Insured the cost of replacing such securities,
determined by the market value thereof at the time of such settlement. However,
if prior to such settlement the Insured shall be compelled by the demands of a
third party or by market rules to purchase equivalent securities, and gives
written notification of this to the Underwriter, the cost incurred by the
Insured shall be taken as the value of those securities. In case of a loss of
subscription, conversion or redemption privileges through the misplacement or
loss of securities, the amount of such loss shall be the value of such
privileges immediately preceding the expiration thereof. If such securities
cannot be replaced or have no quoted market value, or if such privileges have no
quoted market value, their value shall be determined by agreement or
arbitration.

     If the applicable coverage of this bond is subject to a Deductible Amount
and/or is not sufficient in amount to indemnify the Insured in full for the loss
of securities for which claim is made hereunder, the liability of the
Underwriter under this bond is limited to the payment for, or the duplication
of, so much of such securities as has a value equal to the amount of such
applicable coverage.

                       Books of Account and Other Records

     In case of loss of, or damage to, any books of account or other records
used by the Insured in its business, the Underwriter shall be liable under this
bond only if such books or records are actually reproduced and then for not more
than the cost of the blank books, blank pages or other materials plus the cost
of labor for the actual transcription or copying of data which shall have been
furnished by the Insured in order to reproduce such books and other records.

                Property other than Money, Securities or Records

     In case of loss of, or damage to, any Property other than Money,
securities, books of account or other records, or damage covered under Insuring
Agreement (B)(2), the Underwriter shall not be liable for more than the actual
cash value of such Property, or of items covered under Insuring Agreement
(B)(2). The Underwriter may, at its election, pay the actual cash value of,
replace or repair such property. Disagreement between the Underwriter and the
Insured as to the cash value or as to the adequacy of repair or replacement
shall be resolved by arbitration.

                                     Set-Off

     Any loss covered under this bond shall be reduced by a set-off consisting
of any amount owed to the Employee causing the loss if such loss is covered
under Insuring Agreement (A).

                 ASSIGNMENT--SUBROGATION--RECOVERY--COOPERATION

     Section 7.

     (a) In the event of payment under this bond, the Insured shall deliver, if
so requested by the Underwriter, an assignment of such of the Insured's rights,
title and interest and causes of action as it has against any person or entity
to the extent of the loss payment.

     (b) In the event of payment under this bond, the Underwriter shall be
subrogated to all of the Insured's rights of recovery therefor against any
person or entity to the extent of such payment.

     (c) Recoveries, whether effected by the Underwriter or by the Insured,
shall be applied net of the expense of such recovery first to the satisfaction
of the Insured's loss which would otherwise have been paid but for the fact that
it is in excess of either the Single or Aggregate Limit of Liability, secondly,
to the Underwriter all reimbursement of amounts paid in settlement of the
Insured's claim, and thirdly, to the Insured in satisfaction of any Deductible
Amount. Recovery on account of loss of securities as set forth in the second
paragraph of Section 6 or recovery from reinsurance and/or indemnity of the
Underwriter shall not be deemed a recovery as used herein.

     (d) Upon the Underwriter's request and at reasonable times and places
designated by the Underwriter the Insured shall

          (1)  submit to examination by the Underwriter and subscribe to the
               same under oath; and
          (2)  produce for the Underwriter's examination all pertinent records;
               and
          (3)  cooperate with the Underwriter in all matters pertaining to the
               loss.

     (e) The Insured shall execute all papers and render assistance to secure to
the Underwriter the rights and causes of action provided for herein. The Insured
shall do nothing after discovery of loss to prejudice such rights or causes of
action.

             LIMIT OF LIABILITY UNDER THIS BOND AND PRIOR INSURANCE

     Section 8. With respect to any loss set forth in sub-section (c) of Section
4 of this bond which is recoverable or recovered in whole or in part under any
other bonds or policies issued by the Underwriter to the Insured or to any
predecessor in interest of the insured and terminated or canceled or allowed to
expire and in which the period for discovery has not expired at the time any
such loss thereunder is discovered, the total liability of the Underwriter under
this bond and under such other bonds or policies shall not exceed, in the
aggregate, the amount carried hereunder on such loss or the amount available to
the Insured under such other bonds or policies, all limited by the terms and
conditions thereof, for any such loss if the latter amount be the larger.

     If the coverage of this bond supersedes in whole or in part the coverage of
any other bond or policy of insurance issued by an Insurer other than the
Underwriter and terminated, canceled or allowed to expire, the Underwriter, with
respect to any loss sustained prior to such termination, cancelation or
expiration and discovered within the period permitted under such other bond or
policy for the discovery of loss thereunder, shall be liable under this bond
only for that part of such loss covered by this bond as is in excess of the
amount recoverable or recovered on account of such loss under such other bond or
policy, anything to the contrary in such other bond or policy notwithstanding.

                          OTHER INSURANCE OR INDEMNITY

     Section 9. Coverage afforded hereunder shall apply only as excess over any
valid and collectible insurance or indemnity obtained by the Insured, or by one
other than the Insured on Property subject to exclusion (q) or by a
Transportation Company, or by another entity on whose premises the loss occurred
or which employed the person causing the loss or the messenger conveying the
Property involved.

                                   OWNERSHIP

     Section 10. This bond shall apply to loss of Property (1) owned by the
Insured, (2) held by the Insured in any capacity, or (3) for which the Insured
is legally liable. This bond shall be for the sole use and benefit of the
Insured named in the Declarations.

                               DEDUCTIBLE AMOUNT

     Section 11. The Underwriter shall be liable hereunder only for the amount
by which any single loss, as defined in Section 4, exceeds the Single Loss
Deductible amount for the Insuring Agreement or Coverage applicable to such
loss, subject to the Aggregate Limit of Liability and the applicable Single Loss
Limit of Liability.

     The Insured shall, in the time and in the manner prescribed in this bond,
give the Underwriter notice of any loss of the kind covered by the terms of this
bond, whether or not the Underwriter is liable therefor, and upon the request of
the Underwriter shall file with it a brief statement giving the particulars
concerning such loss.

                           TERMINATION OR CANCELATION

     Section 12. This bond terminates as an entirety upon occurrence


                               FIBI4 Page 7 of 8
<PAGE>
of any of the following:--(a) 60 days after the receipt by the Insured of a
written notice from the Underwriter of its desire to cancel this bond, or (b)
immediately upon the receipt by the Underwriter of a written notice from the
Insured of its desire to cancel this bond, or (c) immediately upon the taking
over of the Insured by a receiver or other liquidator or by State or Federal
officials, or (d) immediately upon the taking over of the Insured by another
institution, or (e) immediately upon exhaustion of the Aggregate Limit of
Liability, or (f) immediately upon expiration of the Bond Period as set forth
in Item 2 of the Declarations.

     This bond terminates as to any Employee or any partner, officer or employee
of any Processor--(a) as soon as any Insured, or any director or officer not in
collusion with such person, learns of any dishonest or fraudulent act committed
by such person at any time, whether in the employment of the Insured or
otherwise, whether or not of the type covered under Insuring Agreement (A),
against the Insured or any other person or entity, without prejudice to the loss
of any Property then in transit in the custody of such person, or (b) 15 days
after the receipt by the Insured of a written notice from the Underwriter of its
desire to cancel this bond as to such person.

     Termination of the bond as to any Insured terminates liability for any loss
sustained by such Insured which is discovered after the effective date of such
termination.


IN WITNESS WHEREOF, the Underwriter has caused this Bond to be signed by its
President and by its Secretary at Baltimore, Maryland, and to be countersigned
on the DECLARATIONS page by a duty authorized representative.


         ATTEST:                                    BY

         /s/ JAMES J. KEENAN, JR.                        /s/ ROBERT F. WILLIAMS

                       Secretary                                      President




                               FIB14 Page 8 of 8
<PAGE>
[THE F&D COMPANIES LOGO]                                             Home Office
                                                                   P.O. Box 1227
                                     RIDER                   Baltimore, MD 21203

--------------------------------------------------------------------------------
                This rider forms a part of and is issued by the
                    Underwriter of the bond numbered below.
--------------------------------------------------------------------------------

     If this form is issued concurrently with the bond, this Attaching Clause
     need not be completed.

To be attached to and form part
of Bond No. FIB 0005569 00                               Effective Date 11-01-02
--------------------------------------------------------------------------------

It is agreed that:

     The attached bond is amended:

      (a) by deleting the numbered paragraph beginning

               "each natural person, partnership or corporation authorized by
                the Insured to perform services as Data Processor..."

          from the definition of "Employee" in Section 1.;

      (b) by deleting the following from the second paragraph of Section 12.:

               "or any partner, officer or employee of any Processor"





ACCEPTED:



------------------------------------------
                (INSURED)

By:
   ---------------------------------------
             (OFFICIAL TITLE)


SR 6100e DELETE DATA PROCESSING COVERAGE

FOR USE WITH FINANCIAL INSTITUTION BOND, STANDARD
FORMS NOS. 14, 15, 24 AND 25, TO DELETE DATA
PROCESSING COVERAGE.

REVISED TO DECEMBER, 1993.

F4746c

                                    INSURED
<PAGE>
                                               This form must be completed for
                                               each new bond and at each premium
                                               anniversary.


[THE F&D           Fidelity and Deposit Company of Maryland        Home Offices
COMPANIES LOGO]    Colonial American Casualty and Surety Company   P.O. Box 1227
                                                                   Baltimore,
                                                                   Md. 21203

                               APPLICATION FOR A
                FINANCIAL INSTITUTION BOND, STANDARD FORM NO. 14
                               FOR BROKER/DEALERS

Application is hereby made by Berthel Growth & Income Trust; Berthel SBIC, LLC
                              --------------------------------------------------

--------------------------------------------------------------------------------
             (List all Insureds, including Employee Benefit Plans)

Principal Address   701  Tama St. Marion   IA     52302  (herein called Insured)
                  ---------------------------------------
                   (No.) (Street) (City) (State)(Zip Code)

for a                                                     Financial Institution
      ---------------------------------------------------
      (primary, excess, concurrent, co-surety, coinsured)

Bond, Standard From No. 14, to become effective as of 12:01 a.m. on 11-1-02 to
                                                                    -------
12:01 a.m. on 11-1-03 in the Aggregate Limit of Liability of $500,000
              -------                                         -----------------
Date Insured was established                 Name of prior carrier   FID
                             ---------------                      -------------
--------------------------------------------------------------------------------
1.  Insured is a (check appropriate box):
    Stock Broker [ ], Investment Banker [ ], Dealer in Securities (not Dealer in
    Mortgages or Commercial Paper) [ ], Investment Trust (not Small Business
    Investment Company or Real Estate Investment Trust) [x], Mutual Fund [ ],
    Foundation [ ], Endowment Fund [ ], Commodity Broker (if Stock Exchange
    Member) [ ], Other [ ]
                           -----------------------------------
--------------------------------------------------------------------------------
2.  Insured is a (check appropriate box): Sole Proprietorship [ ],
    Partnership [ ], Corporation [x]
--------------------------------------------------------------------------------
3.  List exchanges which you are a member of:

                     Name                                  Name
                     ----                                  ----
                     N/A
    -------------------------------------  -------------------------------------

    -------------------------------------  -------------------------------------

    -------------------------------------  -------------------------------------
--------------------------------------------------------------------------------
4.  Are you a member of the National Association of Securities
    Dealers, Inc.?............................................... Yes [ ] No [x]
--------------------------------------------------------------------------------
5.  For all Insureds, show the total number of:
                                                                        No. of
                                                                        ------
    (a) Salaried officers and employees, retained attorneys and
        persons provided by employment contractors....................     0
                                                                       ---------
    (b) NASD Registered Representatives (other than those counted
        in (a) above).................................................     0
                                                                       ---------
    (c) Locations (other than the Home Office of the first Named
        Insured) in the U.S., Canada, Puerto Rico and Virgin Islands..
                                                                       ---------
    (d) Locations outside of the U.S., Canada, Puerto Rico and Virgin
        Islands, list below:

                   Location                              Location
                   --------                              --------

    -------------------------------------  -------------------------------------

    -------------------------------------  -------------------------------------

    -------------------------------------  -------------------------------------

    -------------------------------------  -------------------------------------
--------------------------------------------------------------------------------
6.  Complete the following:
                                                                    Total Assets
                                                                    ------------
    (a) As of latest Dec. 31 ...................................... $  9,500,000
                                                                     -----------
    (b) As of latest June 30 ...................................... $
                                                                     -----------
--------------------------------------------------------------------------------
7.  Complete the following for optional coverages desired:
                         Form of Coverage                      Single Loss Limit
                         ----------------                      -----------------
    (a) Is Insuring Agreement (D) - Forgery or Alteration
        Coverage desired?................ Yes [ ] No [x]...... $
                                                                ----------------
    (b) Is Insuring Agreement (E) - Securities Coverage
        desired?......................... Yes [ ] No [x]...... $
                                                                ----------------

F4757d-9-99
<PAGE>
7.  Complete the following for optional coverages desired (cont'd):
                                                               Single Loss Limit
                                                               -----------------
    (c) Is Extortion - Threats to Persons Coverage
        desired?......................... Yes [ ] No [x]...... $________________
        If "Yes", list below locations to be excluded:

                     Location                             Location
                     --------                             --------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

                                                               Single Loss Limit
                                                               -----------------
    (d) Is Extortion - Threats to Property Coverage
        desired?......................... Yes [ ] No [x]...... $________________
        If "Yes", list below locations to be excluded:

                     Location                             Location
                     --------                             --------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

                                                               Single Loss Limit
                                                               -----------------
    (e) Is Computer Systems Fraud Coverage
        desired?......................... Yes [ ] No [x]...... $________________
        If "Yes", complete the following:
        (1) Insured's Computer System(s)
            For the Computer System(s) you operate, whether owned or leased,
            complete the following.
            a) Number of independent software contractors authorized to design,
               implement or service programs for your System(s)....... _________
            b) Is access to your System(s) by customers or other
               outside parties permitted?........................ Yes [ ] No [ ]
        (2) Other Computer Systems
            List below other Computer System(s) for which coverage is desired:

                                      Computer Systems
                                      ----------------

            --------------------------------------------------------------------

            --------------------------------------------------------------------

            --------------------------------------------------------------------

    (f) Is coverage desired on businesses engaged in the data processing of
        your checks or other accounting records?................. Yes [ ] No [x]
        If "Yes", list below the name and location of each data processor:

                  Name & Location                      Name & Location
                  ---------------                      ---------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

                                                               Single Loss Limit
                                                               -----------------
    (g) If you are a partnership, is coverage desired on
        your partners?............ N/A    Yes [ ] No [ ]...... $________________
        If "Yes", list below the name of each partner:

                       Name                                 Name
                       ----                                 ----

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------
--------------------------------------------------------------------------------
8.  Are you a direct participant in a depository for the
    central handling of securities?.............................. Yes [ ] No [x]
    If "Yes", list below the name and location of each depository:

                  Name & Location                      Name & Location
                  ---------------                      ---------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------

        -----------------------------------  -----------------------------------
--------------------------------------------------------------------------------

F4757d-9-99                          2 of 4
<PAGE>
9.  For deductibles, complete the following: (NOTE: Deductibles on Insuring
    Agreements (D) and (E) must be at least equal to that carried on the Basic
    Bond Coverage. Deductibles on Extortion Coverage may be written in any
    amount.)

                           Coverage                       Single Loss Deductible
                           --------                       ----------------------
    (a) All coverages except Insuring Agreements (D), (E),
        and Extortion.................................... $0
                                                           ---------------------
    (b) Insuring Agreement (D) - Forgery or Alteration... $_____________________
    (c) Insuring Agreement (E) - Securities.............. $_____________________
    (d) Extortion - Threats to Persons................... $_____________________
    (e) Extortion - Threats to Property.................. $_____________________
--------------------------------------------------------------------------------
10. If coverage is being written on an excess, concurrent or co-surety basis,
    show the names of the other carriers and bond limits. In the case of
    co-surety also show percentage participations:    N/A
    ____________________________________________________________________________
    ____________________________________________________________________________
--------------------------------------------------------------------------------
11. If coverage is being written on a coinsurance basis, show your percentage
    participation       % (NOTE: Insured may assume a participation of between
    5% and 25%.)
                 N/A
--------------------------------------------------------------------------------
12. Are accounts insured by the Securities Investors Protection
    Corporation?................................................. Yes [ ] No [x]
--------------------------------------------------------------------------------
13. AUDIT PROCEDURES:

    (a) Is there an annual [x], semi-annual [ ] audit by an
        independent CPA?......................................... Yes [x] No [ ]
    (b) If "Yes", is it a complete audit made in accordance with
        generally accepted auditing standards and so certified?.. Yes [x] No [ ]
    (c) If the answer to (b) is "No", explain the scope of the
        CPA's examination ______________________________________________________
        ________________________________________________________________________
    (d) Is the audit report rendered directly to all partners if
        a partnership or to the Board of Directors if a
        corporation?............................................. Yes [x] No [ ]
    (e) Name and location of CPA         Deloitte & Touche, Cedar Rapids, IA
    (f) Date of completion of the last audit by CPA         February 2002
    (g) Is there a continuous internal audit by an Internal
        Audit Department?........................................ Yes [ ] No [x]
    (h) If "Yes", are monthly reports rendered directly to all
        partners if a partnership or to the Board of Directors
        if a corporation?........................................ Yes [ ] No [ ]
    (i) Are money and securities actually counted and
        verified?......................................... N/A    Yes [ ] No [ ]
    (j) Are the ledger balances to the credit of customers
        verified?................................................ Yes [ ] No [ ]
--------------------------------------------------------------------------------
14. INTERNAL CONTROLS (OTHER THAN AUDIT PROCEDURES):

    (a) Do you require annual vacations of at least two
        consecutive weeks for all personnel?..................... Yes [ ] No [x]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________

    (b) Are bank accounts reconciled by someone not authorized
        to deposit or withdraw?.................................. Yes [x] No [ ]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________

    (c) Is countersignature of checks required?.................. Yes [x] No [ ]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________

    (d) Are monthly statements (whether or not there was activity
        in the account) mailed directly to all customers?........ Yes [x] No [ ]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
--------------------------------------------------------------------------------
15. Has there been any change in ownership or management within
    the past three years?........................................ Yes [ ] No [x]
    If "Yes", explain: _________________________________________________________
    ____________________________________________________________________________
    ____________________________________________________________________________
    ____________________________________________________________________________
--------------------------------------------------------------------------------



F4757d-9-99
Revised to December, 1993
SA 5870c Printed in U.S.A.           3 of 4

<PAGE>
9.  For deductibles, complete the following: (NOTE: Deductibles on Insuring
    Agreements (D) and (E) must be at least equal to that carried on the Basic
    Bond Coverage. Deductibles on Extortion Coverage may be written in any
    amount.)

                           Coverage                       Single Loss Deductible
                           --------                       ----------------------
    (a) All coverages except Insuring Agreements (D), (E),
        and Extortion.................................... $0
                                                           ---------------------
    (b) Insuring Agreement (D) - Forgery or Alteration... $_____________________
    (c) Insuring Agreement (E) - Securities.............. $_____________________
    (d) Extortion - Threats to Persons................... $_____________________
    (e) Extortion - Threats to Property.................. $_____________________
--------------------------------------------------------------------------------
10. If coverage is being written on an excess, concurrent or co-surety basis,
    show the names of the other carriers and bond limits. In the case of
    co-surety also show percentage participations:    N/A
    ____________________________________________________________________________
    ____________________________________________________________________________
--------------------------------------------------------------------------------
11. If coverage is being written on a coinsurance basis, show your percentage
    participation       % (NOTE: Insured may assume a participation of between
    5% and 25%.)
                 N/A
--------------------------------------------------------------------------------
12. Are accounts insured by the Securities Investors Protection
    Corporation?................................................. Yes [ ] No [x]
--------------------------------------------------------------------------------
13. AUDIT PROCEDURES:

    (a) Is there an annual [x], semi-annual [ ] audit by an
        independent CPA?......................................... Yes [x] No [ ]
    (b) If "Yes", is it a complete audit made in accordance with
        generally accepted auditing standards and so certified?.. Yes [x] No [ ]
    (c) If the answer to (b) is "No", explain the scope of the
        CPA's examination ______________________________________________________
        ________________________________________________________________________
    (d) Is the audit report rendered directly to all partners if
        a partnership or to the Board of Directors if a
        corporation?............................................. Yes [x] No [ ]
    (e) Name and location of CPA         Deloitte & Touche, Cedar Rapids, IA
    (f) Date of completion of the last audit by CPA         February 2002
    (g) Is there a continuous internal audit by an Internal
        Audit Department?........................................ Yes [ ] No [x]
    (h) If "Yes", are monthly reports rendered directly to all
        partners if a partnership or to the Board of Directors
        if a corporation?........................................ Yes [ ] No [ ]
    (i) Are money and securities actually counted and
        verified?......................................... N/A    Yes [ ] No [ ]
    (j) Are the ledger balances to the credit of customers
        verified?................................................ Yes [ ] No [ ]
--------------------------------------------------------------------------------
14. INTERNAL CONTROLS (OTHER THAN AUDIT PROCEDURES):

    (a) Do you require annual vacations of at least two
        consecutive weeks for all personnel?..................... Yes [ ] No [x]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________

    (b) Are bank accounts reconciled by someone not authorized
        to deposit or withdraw?.................................. Yes [x] No [ ]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________

    (c) Is countersignature of checks required?.................. Yes [x] No [ ]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________

    (d) Are monthly statements (whether or not there was activity
        in the account) mailed directly to all customers?........ Yes [x] No [ ]
        If "No", explain: ______________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
        ________________________________________________________________________
--------------------------------------------------------------------------------
15. Has there been any change in ownership or management within
    the past three years?........................................ Yes [ ] No [x]
    If "Yes", explain: _________________________________________________________
    ____________________________________________________________________________
    ____________________________________________________________________________
    ____________________________________________________________________________
--------------------------------------------------------------------------------



F4757d-9-99
Revised to December, 1993
SA 5870c Printed in U.S.A.           3 of 4

<PAGE>
16.
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17. List all losses ?????????????????                          to
                                                                 ---------------

Check if none [X]


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                        Amount         Amount                  If Loss occurred
Date    Type   Amount  Recovered     Recovered       Amount     at other than
 of      of      of      from        from other     of Loss      Main Office,
Loss    Loss    Loss   Insurance   than Insurance   Pending    state location
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$       $      $       $           $                $
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FRAUD NOTICES: Prior to signing this Application, please review the following
statutory fraud notices as they may apply to the Company's domicile.

ARKANSAS: Any person who knowingly presents a false or fraudulent claim for
payment of a loss benefit or knowingly presents false information in an
application for insurance is guilty of a crime and may be subject to fines and
confinement in prison.

COLORADO: It is unlawful to knowingly provide false, incomplete, or misleading
facts or information to an insurance company for the purpose of defrauding or
attempting to defraud the company. Penalties may include imprisonment, fines,
denial of insurance, and civil damages. Any insurance company or agent of an
insurance company who knowingly provides false, incomplete, or misleading facts
or information to a policy holder or claimant for the purpose of defrauding or
attempting to defraud the policy holder or claimant with regard to a settlement
or award payable from insurance proceeds shall be reported to the Colorado
Division of Insurance within the Department of Regulatory Agencies.

FLORIDA: Any person who knowingly and with intent to injure, defraud or deceive
any insurer files a statement of claim or an application containing any false,
incomplete or misleading statement is guilty of a felony of the third degree.

KENTUCKY: Any person who knowingly and with intent to defraud any insurance
company or other person files an application for insurance containing materially
false information or conceals for the purpose of misleading, information
concerning any fact material thereto commits a fraudulent insurance act, which
is a crime.

MAINE: It is a crime to knowingly provide false, incomplete or misleading
information to an insurance company for the purpose of defrauding the company.
Penalties may include imprisonment, fines or denial of insurance benefits.

NEW JERSEY: Any person who includes any false or misleading information on an
application for an insurance policy is subject to criminal and civil penalties.

NEW MEXICO: Any person who knowingly presents a false or fraudulent claim for
payment of a loss or benefit or knowingly presents false information in an
application for insurance is guilty of a crime and may be subject to civil fines
and criminal penalties.

NEW YORK: Any person who knowingly and with intent to defraud any insurance
company or other person files an application for insurance or statement of claim
containing materially false information or conceals for the purpose of
misleading, information concerning any fact material thereto, commits a
fraudulent insurance act, which is a crime, and shall also be subject to a civil
penalty not to exceed five thousand dollars and the stated value of the claim
for each violation.

OHIO: Any person who, with intent to defraud or knowing that he is facilitating
a fraud against an insurer, submits an application or files a claim containing a
false or deceptive statement is guilty of insurance fraud.

OKLAHOMA: Any person who, knowingly and with intent to injure, defraud or
deceive any insurer, makes any claim for the proceeds of an insurance policy,
containing false, incomplete or misleading information is guilty of a felony.

PENNSYLVANIA: Any person who knowingly and with intent to defraud any insurance
company or other person files an application for insurance or statement of claim
containing materially false information or conceals for the purpose of
misleading, information concerning any fact material thereto, commits a
fraudulent insurance act, which is a crime, and subjects such person to criminal
and civil penalties.

VIRGINIA: It is unlawful to knowingly provide false, incomplete, or misleading
information to an insurance company for the purpose of defrauding the company.
Penalties include imprisonment, fines and denial of insurance benefits.

Dated at Cedar Rapids this [x] 14th day of October 2002
         ------------          ----        ------- ----


Berthel Growth & Income Trust, Berthel SBIC, LLC   By: /s/ DANIEL P. WEGMANN
------------------------------------------------      --------------------------
            (Insured)                                      (Name and Title)
                                                      Daniel P. Wegmann 10/22/02
                                                      Controller
                                                      BFC Planning
                                                      Trust Advisor

54757d-9-99


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