Kemper Horizon Fund
Kemper Horizon 20+ Portfolio
Kemper Horizon 10+ Portfolio
Kemper Horizon 5 Portfolio
Kemper Target Equity Fund
Kemper Retirement Fund Series VII
Supplement to the currently effective Statements of Additional
Information of each of the listed funds and portfolios (each a "Fund")
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The following disclosure replaces the relevant paragraph in the "Custodian,
Transfer Agent, and Shareholder Services Agent" section of the Statement of
Additional Information for the Kemper Retirement Fund Series VII.
Custodian, Transfer Agent and Shareholder Service Agent. State Street Bank and
Trust Company ("State Street"), 225 Franklin Street, Boston, Massachusetts
02110, as custodian, has custody of all securities and cash of the Trust. State
Street attends to the collection of principal and income, and payment for and
collection of proceeds of securities bought and sold by the Fund. Investors
Fiduciary Trust Company ("IFTC"), 801 Pennsylvania Avenue, Kansas City, Missouri
64105, is the Trust's transfer agent and dividend-paying agent. Pursuant to a
services agreement with IFTC, Kemper Service Company ("KSvC"), an affiliate of
Scudder Kemper, serves as "Shareholder Service Agent" of the Fund, and, as such,
performs all of IFTC's duties as transfer agent and dividend paying agent. IFTC
receives from the Fund as transfer agent, and pays to KSvC, as follows: prior to
January 1, 1999, annual account fees at a maximum rate of $6 per account plus
account set up, transaction and maintenance charges and out-of-pocket expense
reimbursement and effective January 1, 1999, annual account fees of $10.00
($18.00 for retirement accounts) plus set up charges, annual fees associated
with the contingent deferred sales charges (Class B only), an asset-based fee of
0.08% and out-of-pocket reimbursement.
The following disclosure supplements all relevant information in the Statement
of Additional Information for the above-listed funds.
On September 7, 1998, Zurich Insurance Company ("Zurich"), the majority owner of
Scudder Kemper Investments, Inc. (the "Adviser"), entered into an agreement with
B.A.T Industries p.l.c. ("B.A.T"), pursuant to which the financial services
businesses of B.A.T were combined with Zurich's businesses to form a new global
insurance and financial services company known as Zurich Financial Services.
Upon consummation of the transaction, each Fund's investment management
agreement with the Adviser was deemed to have been assigned and, therefore,
terminated. The Board of Trustees of each Fund and the shareholders of each Fund
have approved a new investment management agreement with the Adviser, which is
substantially identical to the former investment management agreement, except
for the dates of execution and termination.
At special meetings of shareholders of each Fund held on December 17, 1998 (the
"Special Meetings"), the shareholders confirmed the following: as a matter of
fundamental policy, each Fund is classified as a diversified open-end investment
company, or as a diversified series of an open-end investment company, under the
Investment Company Act of 1940 (the "1940 Act"), but the shareholders voted to
eliminate any additional fundamental diversification policies.
Additionally, at each Fund's Special Meeting, the shareholders approved the
reclassification of each Fund's investment objective(s) and policies as
non-fundamental, with the exception of those policies required to be fundamental
by the 1940 Act (see below). An objective or policy which is non-fundamental may
be changed or eliminated by a Fund's Board of Trustees without a vote of the
shareholders.
Each Fund's fundamental policies have been amended by a vote of shareholders at
each Fund's Special Meeting. Following is a list of each Fund's amended and
restated fundamental policies. As a matter of fundamental policy, each Fund may
not:
1. borrow money, except as permitted under the Investment Company Act of 1940,
as amended, and as interpreted or modified by regulatory authority having
jurisdiction, from time to time;
2. issue senior securities, except as permitted under the Investment Company
Act of 1940, as amended, and as interpreted or modified by regulatory
authority having jurisdiction, from time to time;
April 9, 1999
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3. concentrate its investments in a particular industry, as that term is used
in the Investment Company Act of 1940, as amended, and as interpreted or
modified by regulatory authority having jurisdiction, from time to time;
4. engage in the business of underwriting securities issued by others, except
to the extent that a Fund may be deemed to be an underwriter in connection
with the disposition of portfolio securities;
5. purchase or sell real estate, which term does not include securities of
companies which deal in real estate or mortgages or investments secured by
real estate or interests therein, except that the Fund reserves freedom of
action to hold and to sell real estate acquired as a result of the Fund's
ownership of securities;
6. purchase physical commodities or contracts relating to physical
commodities;
7. make loans except as permitted under the Investment Company Act of 1940, as
amended, and as interpreted or modified by regulatory authority having
jurisdiction, from time to time.
The following policies are non-fundamental, and may be changed or eliminated for
each Fund by its Board without a vote of the shareholders:
Each series of Kemper Horizon Fund may not:
1. purchase securities of any issuer (other than obligations of, or guaranteed
by, the U.S. Government, its agencies or instrumentalities) if, as a
result, more than 5% of the total value of its assets would be invested in
securities of that issuer. To the extent a Portfolio invests in loan
participations, the Portfolio, as a non-fundamental policy, considers both
the lender and the borrower to be an issuer of such loan participation;
2. purchase more than 10% of any class of voting securities of any issuer;
3. pledge, hypothecate, mortgage or otherwise encumber more than 15% of its
total assets and then only to secure permitted borrowings. (The collateral
arrangements with respect to options, financial futures and delayed
delivery transactions and any margin payments in connection therewith are
not deemed to be pledges or other encumbrances.);
4. purchase securities on margin, except to obtain such short-term credits as
may be necessary for the clearance of transactions; however, the Portfolio
may make margin deposits in connection with options and financial futures
transactions;
5. make short sales of securities or maintain a short position for its account
unless at all times when a short position is open it owns an equal amount
of such securities or owns securities which, without payment of any further
consideration, are convertible into or exchangeable for securities of the
same issue as, and equal in amount to, the securities sold short and unless
not more than 10% of the Portfolio's total assets is held as collateral for
such sales at any one time;
6. invest in real estate limited partnerships.
Kemper Retirement Fund Series VII may not:
1. purchase securities of any issuer (other than obligations of, or guaranteed
by, the U.S. Government, its agencies or instrumentalities) if, as a
result, more than 5% of the total value of the Fund's assets would be
invested in securities of that issuer;
2. purchase more than 10% of any class of voting securities of any issuer;
3. pledge, hypothecate, mortgage or otherwise encumber more than 15% of its
total assets and then only to secure permitted borrowings. (The collateral
arrangements with respect to options, financial futures and delayed
delivery transactions and any margin payments in connection therewith are
not deemed to be pledges or other encumbrances.);
4. purchase securities on margin, except to obtain such short-term credits as
may be necessary for the clearance of transactions; however, the Fund may
make margin deposits in connection with options and financial futures
transactions;
5. make short sales of securities or other assets or maintain a short position
for the account of the Fund unless at all times when a short position is
open it owns an equal amount of such securities or other assets or owns
securities which, without payment of any further consideration, are
convertible into or exchangeable for securities or other assets of the same
issue as, and equal in amount to, the securities or other assets sold short
and unless not more than 10% of the Fund's total assets is held as
collateral for such sales at any one time;
6. invest in real estate limited partnerships.
