<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 14, 1999
COMMISSION FILE NOS. 333-22375
811-3199
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
<TABLE>
<S> <C>
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 6 [X]
and
REGISTRATION STATEMENT UNDER
THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 49 [X]
</TABLE>
KILICO VARIABLE ANNUITY SEPARATE ACCOUNT
(EXACT NAME OF REGISTRANT)
KEMPER INVESTORS LIFE INSURANCE
COMPANY
(NAME OF INSURANCE COMPANY)
<TABLE>
<S> <C>
1 Kemper Drive, Long Grove, Illinois 60049
(Address of Insurance Company's Principal Executive Offices) (Zip Code)
Insurance Company's Telephone Number, including Area Code: (847) 550-5500
</TABLE>
Debra P. Rezabek, Esq.
1 Kemper Drive
Long Grove, Illinois 60049
(Name and Address of Agent for Service)
COPIES TO:
FRANK JULIAN, ESQ.
KEMPER INVESTORS LIFE INSURANCE COMPANY
1 KEMPER DRIVE
LONG GROVE, ILLINOIS 60049
JOAN E. BOROS, ESQ.
JORDEN BURT BOROS
CICCHETTI BERENSON & JOHNSON
1025 THOMAS JEFFERSON STREET, N.W.
SUITE 400E
WASHINGTON, D.C. 20007
Approximate Date of Proposed Public Offering: As soon as practicable after
the effective date of this filing.
It is proposed that this filing will become effective (check appropriate
box)
[X] immediately upon filing pursuant to paragraph (b) of Rule 485
[ ] on (date) pursuant to paragraph (b) of Rule 485
[ ] 60 days after filing pursuant to paragraph (a)(1) of Rule 485
[ ] on (date) pursuant to paragraph (a)(1) of Rule 485
If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment
Title of Securities Being Registered:
Variable portion of individual and group variable, fixed and market value
adjusted deferred annuity contracts.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
This amendment to the registration statement on Form N-4 (the "Registration
Statement") is being filed pursuant to Rule 485(b) under the Securities Act of
1933, as amended. This amendment is being filed for the sole purpose of filing a
supplement to the May 1, 1999 Kemper Destinations prospectus (and a related
exhibit), one of two prospectuses contained in the Registration Statement. This
amendment does not relate to the Farmers Variable Annuity I prospectus and does
not otherwise delete, amend or supersede any information contained in the
Registration Statement.
<PAGE> 3
SUPPLEMENT DATED SEPTEMBER 14, 1999
TO PROSPECTUS DATED MAY 1, 1999 FOR
- --------------------------------------------------------------------------------
INDIVIDUAL AND GROUP VARIABLE,
FIXED AND MARKET
VALUE ADJUSTED DEFERRED ANNUITY
CONTRACTS
- --------------------------------------------------------------------------------
ISSUED BY
KILICO VARIABLE ANNUITY SEPARATE ACCOUNT
AND
KEMPER INVESTORS LIFE INSURANCE COMPANY
Effective September 14, 1999, one new Subaccount is being added as an investment
option under the Contracts.
The new Portfolio in which the Subaccount invests is the Kemper Index 500
Portfolio of Kemper Variable Series. A prospectus for the new Portfolio is
attached to this Supplement.
In addition, effective July 6, 1999, Credit Suisse Asset Management, LLC became
the investment adviser for the two available Portfolios of the Warburg Pincus
Trust as a result of the closing of the previously announced acquisition of
Warburg Pincus Asset Management, Inc. by Credit Suisse Group, and the
combination of Warburg Pincus Asset Management, Inc. with Credit Suisse Group's
existing U.S. asset management business.
The changes to the Prospectus follow with references to those parts of the
Prospectus that are modified by this Supplement.
INTRODUCTION
The second paragraph on the cover page of the Prospectus is revised to read as
follows:
"You may allocate purchase payments to one or more of the variable options,
the fixed option or the fixed option subject to a market value adjustment.
The Contract currently offers thirty-two investment options, each of which
is a Subaccount of KILICO Variable Annuity Separate Account. Currently, you
may choose among the following Portfolios:
KEMPER VARIABLE SERIES (formerly Investors Fund Series): Kemper Money
Market; Kemper Government Securities; Kemper Investment Grade Bond; Kemper
Global Income; Kemper Horizon 5; Kemper High Yield; Kemper Horizon 10+;
Kemper Total Return; Kemper Horizon 20+; Kemper Index 500; Kemper
Value+Growth; Kemper Blue Chip; Kemper International; Kemper Contrarian
Value (formerly Kemper Value); Kemper Small Cap
S-1
<PAGE> 4
Value; Kemper Small Cap Growth; Kemper Growth; Kemper Aggressive Growth;
Kemper Technology Growth; Kemper Global Blue Chip; Kemper International
Growth and Income; Kemper-Dreman High Return Equity; Kemper-Dreman
Financial Services.
SCUDDER VARIABLE LIFE INVESTMENT FUND (CLASS A SHARES): Scudder VLIF Global
Discovery; Scudder VLIF Growth and Income; Scudder VLIF International;
Scudder VLIF Capital Growth.
JANUS ASPEN SERIES: Janus Aspen Growth; Janus Aspen Growth and Income.
WARBURG PINCUS TRUST: Warburg Emerging Markets; Warburg Post-Venture
Capital.
Subaccounts and Portfolios may be added or deleted in the future. Contract
values allocated to any of the Subaccounts vary, reflecting the investment
experience of the selected Subaccounts. Contract values allocated to the
Fixed account or one or more Guarantee Periods of the Market Value
Adjustment Option accumulate on a fixed basis."
DEFINITIONS
The definition of "Subaccounts" on page 3 of the Prospectus is revised to read
as follows:
"Subaccounts - The thirty-two subdivisions of the Separate Account, the
assets of which consist solely of shares of the corresponding Portfolios."
SUMMARY
The fourth paragraph on page 4 of the Prospectus is revised to read as follows:
"Variable accumulations and benefits are provided by crediting Purchase
Payments to one or more Subaccounts selected by the Owner. Each Subaccount
invests in one of the following corresponding Portfolios:
- Kemper Money Market
- Kemper Government Securities
- Kemper Investment
Grade Bond
- Kemper Global Income
- Kemper Horizon 5
- Kemper High Yield
- Kemper Horizon 10+
- Kemper Total Return
- Kemper Growth
- Kemper Aggressive Growth
- Kemper Technology Growth
- Kemper Global Blue Chip
- Kemper International Growth
and Income
- Kemper-Dreman High
Return Equity
- Kemper-Dreman
Financial Services
- Kemper Horizon 20+
- Kemper Index 500
S-2
<PAGE> 5
- Kemper Value+Growth
- Kemper Blue Chip
- Kemper International
- Kemper Contrarian Value
- Kemper Small Cap Value
- Kemper Small Cap Growth
- Scudder VLIF
Global Discovery
- Scudder VLIF Growth
and Income
- Scudder VLIF International
- Scudder VLIF Capital Growth
- Janus Aspen Growth
- Janus Aspen Growth
and Income
- Warburg Emerging Markets
- Warburg Post-Venture Capital
S-3
<PAGE> 6
The Summary of Expenses and Example Tables appearing on pages 7 through 11 of
the Prospectus are revised to read as follows:
- --------------------------------------------------------------------------------
SUMMARY OF EXPENSES
- --------------------------------------------------------------------------------
CONTRACT OWNER TRANSACTION EXPENSES
<TABLE>
<S> <C>
Sales Load Imposed on Purchases (as a percentage of purchase payments).............................. None
Contingent Deferred Sales Load (as a percentage of amount surrendered)(1)
Year of Withdrawal After Purchase
First year........................... 7%
Second year.......................... 6%
Third year........................... 5%
Fourth year.......................... 5%
Fifth year........................... 4%
Sixth year........................... 3%
Seventh year......................... 2%
Eighth year and following............ 0%
Surrender Fees...................................................................................... None
Exchange Fee(2)..................................................................................... $25
ANNUAL CONTRACT FEE (Records Maintenance Charge)(3)................................................. $30
</TABLE>
<TABLE>
<CAPTION>
SEPARATE ACCOUNT ANNUAL EXPENSES
(as a percentage of average daily account value)
<S> <C>
Mortality and Expense
Risk.................................. 1.25%
Administration.......................... .15%
Account Fees and
Expenses.............................. 0%
---------
Total Separate Account
Annual Expenses....................... 1.40%
=========
GUARANTEED RETIREMENT INCOME BENEFIT
CHARGE
Annual Expense (as a percentage of
Contract Value)....................... .25%
</TABLE>
FUND ANNUAL EXPENSES (After Fee Waivers and Expense
Reductions)
(as percentage of each Portfolio's average net assets for
the period ended December 31, 1998)
<TABLE>
<CAPTION>
KEMPER KEMPER KEMPER KEMPER
MONEY GOVERNMENT INVESTMENT GLOBAL KEMPER
MARKET SECURITIES GRADE BOND(9) INCOME(10) HORIZON 5(9)
------ ---------- ------------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Management Fees... .50% .55% .60% .72% .60%
Other Expenses... .04 .11 .07 .33 .06
Total Portfolio Annual Expenses... .54 .66 .67 1.05 .66
<CAPTION>
KEMPER KEMPER KEMPER KEMPER KEMPER KEMPER
HIGH HORIZON TOTAL HORIZON INDEX VALUE+
YIELD 10+(9) RETURN 20+(9) 500(8) GROWTH(9)
------ ------- ------ ------- ------ ---------
<S> <C> <C> <C> <C> <C> <C>
Management Fees... .60% .60% .55% .60% .26% .75%
Other Expenses... .05 .04 .05 .07 .29 .03
Total Portfolio Annual Expenses... .65 .64 .60 .67 .55 .78
</TABLE>
<TABLE>
<CAPTION>
KEMPER KEMPER KEMPER KEMPER
BLUE KEMPER CONTRARIAN SMALL CAP SMALL CAP
CHIP(9) INTERNATIONAL VALUE(9) VALUE(9) GROWTH
------- ------------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C>
Management Fees... .65% .75% .75% .75% .65%
Other Expenses... .11 .18 .03 .05 .05
Total Portfolio Annual Expenses... .76 .93 .78 .80 .70
<CAPTION>
KEMPER KEMPER-
KEMPER KEMPER KEMPER INTERNATIONAL DREMAN
KEMPER AGGRESSIVE TECHNOLOGY GLOBAL BLUE GROWTH AND HIGH RETURN
GROWTH GROWTH(6) GROWTH(10) CHIP(7)(10) INCOME(7)(10) EQUITY(7)(10)
------ ---------- ---------- ----------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Management Fees... .60% .67% .66% 0.00% 0.00% .42%
Other Expenses... .05 .28 .29 1.56 1.12 .45
Total Portfolio Annual Expenses... .65 .95 .95 1.56 1.12 .87
</TABLE>
<TABLE>
<CAPTION>
KEMPER- SCUDDER SCUDDER
DREMAN SCUDDER VLIF VLIF SCUDDER VLIF
FINANCIAL GLOBAL GROWTH AND VLIF CAPITAL
SERVICES(7)(10) DISCOVERY(11) INCOME INTERNATIONAL GROWTH
--------------- ------------- ---------- ------------- -------
<S> <C> <C> <C> <C> <C>
Management Fees... .02% .91% .47% .87% .47%
Other Expenses... .97 .81 .09 .18 .04
Total Portfolio Annual Expenses... .99 1.72 .56 1.05 .51
- ----------------------------------
<CAPTION>
JANUS WARBURG
JANUS ASPEN WARBURG POST-
ASPEN GROWTH AND EMERGING VENTURE
GROWTH(4) INCOME(4) MARKETS(5) CAPITAL(5)
--------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Management Fees... .65% 0.00% .20% 1.08%
Other Expenses... .03 1.25 1.20 .32
Total Portfolio Annual Expenses... .68 1.25 1.40 1.40
- ----------------------------------
</TABLE>
S-4
<PAGE> 7
(1) A Contract Owner may withdraw up to the greater of (i) the excess of
Contract Value over total Purchase Payments subject to Withdrawal Charges
less prior withdrawals that were previously assessed a Withdrawal Charge,
and (ii) 10% of the Contract Value in any Contract Year without assessment
of any charge. In certain circumstances We may reduce or waive the
contingent deferred sales charge.
(2) We reserve the right to charge a fee of $25 for each transfer of Contract
Value in excess of 12 transfers per calendar year.
(3) Applies to Contracts with a Contract Value less than $50,000 on the date of
assessment. In certain circumstances We may reduce or waive the annual
Records Maintenance Charge.
(4) The expense figures shown are net of certain fee waivers or reductions from
Janus Capital Corporation. Without such waivers, Management Fees, Other
Expenses and Total Portfolio Annual Expenses for the Portfolios for the
fiscal year ended December 31, 1998 would have been: .72%, .03% and .75%,
respectively, for the Growth Portfolio; and .75%, 2.31% and 3.06%,
respectively, for the Growth and Income Portfolio. See the prospectus and
Statement of Additional Information of Janus Aspen Series for a description
of these waivers.
(5) The expense figures shown are net of certain fee waivers or reductions from
the Portfolios' investment adviser and its affiliates based on actual
expenses for fiscal year ended December 31, 1998. Without such waivers,
Management Fees, Other Expenses and Total Portfolio Annual Expenses for the
Portfolios would have been 1.25%, 6.96% and 8.21%, respectively, for the
Emerging Markets Portfolio; and 1.25%, .45% and 1.70%, respectively, for
the Post-Venture Capital Portfolio. Fee waivers and expense reimbursements
may be discontinued at any time.
(6) Portfolios commenced operations after 5/1/99. "Other Expenses" have been
estimated.
(7) Portfolios commenced operations on or after 5/1/98. "Other Expenses" have
been estimated.
(8) Portfolio commenced operations after 9/1/99. "Other Expenses" have been
estimated. Pursuant to their respective agreements with Kemper Variable
Series, the investment manager and the accounting agent have agreed, for
the period from commencement of operations to April 30, 2000, to limit
their respective fees and to reimburse other operating expenses of the
Kemper Index 500 Portfolio to the extent necessary to limit total operating
expenses to the level set forth in the table. Without taking into effect
this cap, management fees are estimated to be .45%, Other Expenses are
estimated to be .29%, and total operating expenses are estimated to be
.74%.
(9) Pursuant to their respective agreements with Kemper Variable Series, the
investment manager and the accounting agent have agreed, for the one year
period commencing on approximately May 1, 1999, to limit their respective
fees and to reimburse other operating expenses, to the extent necessary to
limit total operating expenses of the following described Portfolios to the
amounts set forth after the Portfolio names: Kemper Value + Growth
Portfolio (.84%), Kemper Contrarian Value Portfolio (.80%), Kemper Small
Cap Value Portfolio (.84%), Kemper Horizon 5 Portfolio (.97%), Kemper
Horizon 10+ Portfolio (.83%), Kemper Horizon 20+ Portfolio (.93%), Kemper
Investment Grade Bond Portfolio (.80%), and Kemper Blue Chip Portfolio
(.95%). The amounts set forth in the table above reflect actual expenses
for the past fiscal year, which were lower than these expense limits.
(10) Pursuant to their respective agreements with Kemper Variable Series, the
investment manager and the accounting agent have agreed, for the one year
period commencing on approximately May 1, 1999, to limit their respective
fees and to reimburse other operating expenses, to the extent necessary to
limit total operating expenses of the Kemper Aggressive Growth, Kemper
Technology Growth, Kemper-Dreman Financial Services, Kemper-Dreman High
Return Equity, Kemper International Growth and Income, Kemper Global Blue
Chip and Kemper Global Income Portfolios of Kemper Variable Series to the
levels set forth in the table above. Without taking into effect these
expense caps, for the Aggressive Growth, Technology Growth, Financial
Services, High Return Equity, International Growth and Income, Global Blue
Chip and Global Income Portfolios of Kemper Variable Series: management
fees are estimated to be .75%, .75%, .75%, .75%, 1.00%, 1.00% and .75%.
Other Expenses are estimated to be .28%, .29%, .97%, .45%, 18.54%, 11.32%,
and .33%, respectively, and total operating expenses are estimated to be
1.03%, 1.04%, 1.72%, 1.20%, 19.54%, 12.32%, and 1.08%, respectively. In
addition, for Kemper International Growth and Income and Kemper Global Blue
Chip, the investment manager has agreed to limit its management fee to .70%
and .85%, respectively, of such portfolios for one year from May 1, 1999.
(11) Until April 30, 1998, the Adviser waived a portion of its management fee to
limit the expenses of the Global Discovery Portfolio to 1.50% of the
average daily net assets.
S-5
<PAGE> 8
EXAMPLE
<TABLE>
<CAPTION>
SUBACCOUNT 1 YEAR 3 YEARS 5 YEARS 10 YEARS
---------- ------ ------- ------- --------
<S> <C> <C> <C> <C> <C>
If you surrender your Contract at the Kemper Money Market #1(1) $ 92 $116 $152 $228
end of the periods shown, you would
pay the following expenses on a $1,000 Kemper Government Securities 93 120 158 241
investment, assuming 5% annual return Kemper Investment Grade Bond 93 120 158 242
on assets: Kemper Global Income 97 131 177 281
Kemper Horizon 5 93 120 158 241
Kemper High Yield 93 119 157 240
Kemper Horizon 10+ 93 119 157 239
Kemper Total Return 93 118 155 234
Kemper Horizon 20+ 93 120 158 242
Kemper Index 500 92 116 -- --
Kemper Value+Growth 94 123 164 253
Kemper Blue Chip 94 123 163 251
Kemper International 96 128 171 269
Kemper Contrarian Value 94 123 164 253
Kemper Small Cap Value 94 124 165 255
Kemper Small Cap Growth 94 121 160 245
Kemper Growth 93 119 157 240
Kemper Aggressive Growth 96 128 -- --
Kemper Technology Growth 96 128 -- --
Kemper Global Blue Chip 102 146 202 332
Kemper International Growth and 98 133 181 288
Income
Kemper-Dreman High Return 95 126 168 263
Equity
Kemper-Dreman Financial 96 129 174 275
Services
Scudder VLIF Global Discovery 103 150 210 347
Scudder VLIF Growth and Income 92 117 153 230
Scudder VLIF International 97 131 177 281
Scudder VLIF Capital Growth 92 115 150 225
Janus Aspen Growth 93 120 159 243
Janus Aspen Growth and Income 99 137 187 301
Warburg Emerging Markets 100 141 194 316
Warburg Post-Venture Capital 99 139 190 308
</TABLE>
S-6
<PAGE> 9
EXAMPLE
<TABLE>
<CAPTION>
SUBACCOUNT 1 YEAR 3 YEARS 5 YEARS 10 YEARS
---------- ------ ------- ------- --------
<S> <C> <C> <C> <C> <C>
If you do not surrender your contract,
you would pay the following expenses on
a $1,000 investment, assuming 5% annual
return on assets:
Kemper Money Market #1(1) $ 20 $ 61 $106 $228
Kemper Government Securities 21 65 112 241
Kemper Investment Grade Bond 21 66 112 242
Kemper Global Income 25 77 132 281
Kemper Horizon 5 21 65 112 241
Kemper High Yield 21 65 111 240
Kemper Horizon 10+ 21 65 111 239
Kemper Total Return 21 63 109 234
Kemper Horizon 20+ 21 66 112 242
Kemper Index 500 20 62 -- --
Kemper Value+Growth 22 69 118 253
Kemper Blue Chip 22 68 117 251
Kemper International 24 74 126 269
Kemper Contrarian Value 22 69 118 253
Kemper Small Cap Value 23 70 119 255
Kemper Small Cap Growth 22 66 114 245
Kemper Growth 21 65 111 240
Kemper Aggressive Growth 24 74 -- --
Kemper Technology Growth 24 74 -- --
Kemper Global Blue Chip 30 93 158 332
Kemper International Growth and 26 79 136 288
Income
Kemper-Dreman High Return 23 72 123 263
Equity
Kemper-Dreman Financial 24 75 129 275
Services
Scudder VLIF Global Discovery 32 98 166 347
Scudder VLIF Growth and Income 20 62 107 230
Scudder VLIF International 25 77 132 281
Scudder VLIF Capital Growth 20 61 104 225
Janus Aspen Growth 21 66 113 243
Janus Aspen Growth and Income 27 83 142 301
Warburg Emerging Markets 29 88 150 316
Warburg Post-Venture Capital 28 86 146 308
</TABLE>
S-7
<PAGE> 10
The purpose of the preceding table which includes the "SUMMARY OF EXPENSES" on
the prior page, is to assist Contract Owners in understanding the various costs
and expenses that a Contract Owner in a Subaccount will bear directly or
indirectly. The table reflects expenses of both the Separate Account and the
Fund. THE EXAMPLE SHOULD NOT BE CONSIDERED TO BE A REPRESENTATION OF PAST OR
FUTURE EXPENSES AND DOES NOT INCLUDE THE DEDUCTION OF STATE PREMIUM TAXES, WHICH
MAY BE ASSESSED BEFORE OR UPON ANNUITIZATION. ACTUAL EXPENSES MAY BE GREATER OR
LESS THAN THOSE SHOWN. "Management Fees" and "Other Expenses" in the "SUMMARY OF
EXPENSES" for the Portfolios have been provided by Scudder Kemper Investments,
Inc., Janus Capital Corporation and Credit Suisse Asset Management, LLC
(successor to Warburg Pincus Asset Management, Inc.), as applicable, and have
not been independently verified. The Example assumes a 5% annual rate of return
pursuant to requirements of the Securities and Exchange Commission. This
hypothetical rate of return is not intended to be representative of past or
future performance of any Subaccount. The Records Maintenance Charge is a single
charge, it is not a separate charge for each Subaccount. In addition, the effect
of the Records Maintenance Charge has been reflected in the Example by applying
the percentage derived by dividing the total amounts of annual Records
Maintenance Charge collected by the total net assets of all the Subaccounts in
the Separate Account. See "Contract Charges and Expenses" for more information
regarding the various costs and expenses.
(1)Money Market Subaccount #2 is not shown because it is available only for
dollar cost averaging that will deplete an Owner's subaccount value entirely
at least by the end of the first Contribution Year.
S-8
<PAGE> 11
THE FUNDS
The first line on page 18 of the Prospectus is revised to read as follows:
"The thirty-one Portfolios are summarized below:"
Also on page 18 of the Prospectus, the section entitled "KEMPER VARIABLE SERIES
(FORMERLY INVESTORS FUND SERIES)" is revised to add the following between
"KEMPER HORIZON 20+ PORTFOLIO" and "KEMPER VALUE+GROWTH PORTFOLIO":
"KEMPER INDEX 500 PORTFOLIO seeks to match, as closely as possible, before
expenses, the performance of the Standard & Poor's 500 Composite Stock
Price Index, which emphasizes stocks of large U.S. companies.*"
The second paragraph on page 20 of the Prospectus is revised to read as follows:
"Scudder Kemper Investments, Inc. ("SKI") is the investment manager for the
twenty-three available Portfolios of Kemper Variable Series (formerly
Investors Fund Series) and the four available Portfolios of Scudder
Variable Life Investment Fund. Bankers Trust Company ("Bankers") is the
sub-adviser for the Kemper Index 500 Portfolio. Under the terms of the
sub-advisory agreement with SKI, Bankers will handle day-to-day investment
and trading functions for the Kemper Index 500 Portfolio. Scudder
Investments (U.K.) Limited ("Scudder U.K."), an affiliate of SKI, is the
sub-adviser for Kemper International Portfolio and the Kemper Global Income
Portfolio. Under the terms of the Sub-Advisory Agreement with SKI, Scudder
U.K. renders investment advisory and management services with regard to
that portion of these Portfolios' assets as may be allocated by SKI to
Scudder U.K. from time to time for management, including services related
to foreign securities, foreign currency transactions and related
investments. Dreman Value Management L.L.C. ("DVM") serves as sub-adviser
for the Kemper-Dreman High Return Equity and Kemper-Dreman Financial
Services Portfolios. Under the terms of the sub-advisory agreement between
SKI and DVM for each such Portfolio, DVM manages the day-to-day investment
and trading functions for each such Portfolios. Janus Capital Corporation
is the investment adviser for the two available Portfolios of the Janus
Aspen Series. Credit Suisse Asset Management, LLC (successor to Warburg
Pincus Asset Management, Inc.) is the investment adviser for the two
available Portfolios of the Warburg Pincus Trust. The investment advisers
are paid fees for their services by the Funds they manage.
- ---------------
* "Standard & Poor's(R)," "S&P(R)," "S&P 500(R)," "Standard & Poor's 500," and
"500" are trademarks of The McGraw-Hill Companies, Inc., and have been
licensed for use by Scudder Kemper Investments, Inc. The Kemper Index 500
Portfolio is not sponsored, endorsed, sold or promoted by Standard & Poor's,
and Standard & Poor's makes no representation regarding the advisability of
investing in the fund. Additional information may be found in the fund's
Statement of Additional Information.
S-9
<PAGE> 12
KILICO may receive compensation from the Funds or the investment advisers
of the Funds for services related to the Funds. Such compensation will be
consistent with the services rendered or the cost savings resulting from
the arrangement."
The section entitled "KEMPER VARIABLE SERIES (FORMERLY INVESTORS FUND SERIES)"
on pages 20 and 21 of the Prospectus is revised to read as follows:
"For its services, SKI is paid a management fee based upon the average
daily net assets of each Portfolio, as follows: Kemper Money Market (.50 of
1%), Kemper Government Securities (.55 of 1%), Kemper Investment Grade Bond
(.60 of 1%), Kemper Global Income (.75 of 1%), Kemper Horizon 5 (.60 of
1%), Kemper High Yield (.60 of 1%), Kemper Horizon 10+ (.60 of 1%), Kemper
Total Return (.55 of 1%), Kemper Horizon 20+ (.60 of 1%), Kemper Index 500
(.45% for the first $200 million, .42% for the next $550 million, .40% for
the next $1.25 billion, .38% for the next $3 billion and .35% for amounts
over $5 billion), Kemper Value+Growth (.75 of 1%), Kemper Blue Chip (.65 of
1%), Kemper International (.75 of 1%), Kemper Contrarian Value (.75 of 1%),
Kemper Small Cap Value (.75 of 1%), Kemper Small Cap Growth (.65 of 1%),
Kemper Growth (.60 of 1%), Kemper Global Blue Chip (1.00% for the first
$250 million, .95% for the next $750 million and .90% over $1 billion),
Kemper International Growth and Income (1%), Kemper-Dreman High Return
Equity, Kemper-Dreman Financial Services, Kemper Aggressive Growth, and
Kemper Technology Growth (.75% for the first $250 million, .72% for the
next $750 million, .70% for the next $1.5 billion, .68% for the next $2.5
billion, .65% for the next $2.5 billion, .64% for the next $2.5 billion,
.63% for the next $2.5 billion and .62% over $12.5 billion). SKI pays
Bankers for its services as sub-adviser for the Kemper Index 500 Portfolio
a sub-advisory fee, calculated monthly as a percentage of the Portfolio's
total assets, at the annual rate of .08% for the first $200 million, .05%
for the next $550 million and .025% over $750 million. The minimum annual
fee is set at $100,000; however, the minimum fee does not apply during the
first year of the Portfolio's operations. SKI pays Scudder U.K. for its
services as sub-adviser for the Kemper International Portfolio and the
Kemper Global Income Portfolio a sub-advisory fee, payable monthly, at an
annual rate of .35 of 1% and .30 of 1%, respectively, of the average daily
net assets of such Portfolios. SKI pays DVM for its services as sub-adviser
for the Kemper-Dreman High Return Equity and Kemper-Dreman Financial
Services Portfolios a sub-advisory fee, payable monthly, at the annual rate
of .24% of the first $250 million of each Portfolio's average daily net
assets, .23% of the average daily net assets between $250 million and $1
billion, .224% of average daily net assets between $1 billion and $2.5
billion, .218% of average daily net assets between $2.5 billion and $5
billion, .208% of average daily net assets between $5 billion and $7.5
billion, .205% of average daily net assets between $7.5 billion and $10
billion, .202% of average daily net assets between $10 billion and $12.5
billion and .198% of each Portfolio's average daily net assets over $12
billion."
S-10
<PAGE> 13
The section entitled "WARBURG PINCUS TRUST" on page 22 of the Prospectus is
revised to read as follows:
"Credit Suisse Asset Management, LLC (successor to Warburg Pincus Asset
Management, Inc.) receives a monthly advisory fee based upon the average
daily net assets of each Warburg Portfolio, as follows: Emerging Markets
1.25% (.20% after waivers and/or reimbursements) and Post-Venture Capital
1.25% (1.08% after waivers and/or reimbursements).
S-11
<PAGE> 14
PART C
OTHER INFORMATION
ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS
(A) FINANCIAL STATEMENTS:
(1) Financial Statements included in Part A of the Registration
Statement:
Kemper Investors Life Insurance Company and Subsidiaries
Reports of Independent Public Accountants
Kemper Investors Life Insurance Company and Subsidiaries Consolidated
Balance Sheets, as of December 31, 1998 and 1997
Kemper Investors Life Insurance Company and Subsidiaries Consolidated
Statements of Operations, years ended December 31, 1998, 1997 and
1996
Kemper Investors Life Insurance Company and Subsidiaries Consolidated
Statements of Comprehensive Income, years ended December 31, 1998,
1997 and 1996
Kemper Investors Life Insurance Company and Subsidiaries Consolidated
Statements of Stockholder's Equity, years ended December 31, 1998,
1997 and 1996
Kemper Investors Life Insurance Company and Subsidiaries Consolidated
Statements of Cash Flows, years ended December 31, 1998, 1997 and
1996
Notes to Consolidated Financial Statements
(2) Financial Statements included in Part B of the Registration
Statement:
KILICO Variable Annuity Separate Account
Reports of Independent Accountants
Statement of Assets and Liabilities and Contract Owners' Equity as
of December 31, 1998
Statement of Operations for the Year Ended December 31, 1998
Statements of Changes in Contract Owners' Equity for the Years
Ended December 31, 1998 and 1997
Notes to Financial Statements
(B) EXHIBITS:
<TABLE>
<C> <S>
(4)1.1 A copy of resolution of the Board of Directors of Kemper
Investors Life Insurance Company dated September 13, 1977.
(4)1.2 A copy of Record of Action of Kemper Investors Life
Insurance Company dated April 15, 1983.
2. Not Applicable.
(3)3.1 Distribution Agreement between Investors Brokerage Services,
Inc. and KILICO.
(1)3.2 Addendum to Selling Group Agreement of Kemper Financial
Services, Inc.
(2)3.3 Selling Group Agreement of Investors Brokerage Services,
Inc.
(7)4.1 Form of Group Variable, Fixed and Market Value Adjusted
Annuity Contract.
(7)4.2 Form of Certificate to Group Variable, Fixed and Market
Value Adjusted Annuity Contract.
(7)4.3 Form of Individual Variable, Fixed and Market Value Adjusted
Annuity Contract.
(7)5. Form of Application.
(3)6. Kemper Investors Life Insurance Company articles of
incorporation and by-laws.
7. Inapplicable.
(2)8.1(a) Fund Participation Agreement among KILICO, Janus Aspen
Series and Janus Capital Corporation.
(5)8.1(b) Service Agreement between KILICO and Janus Capital
Corporation.
(8)8.2(a) Participation Agreement By and Among Kemper Investors Life
Insurance Company and Warburg, Pincus Trust and Warburg
Pincus Asset Management Inc. (f/k/a Warburg, Pincus
Counsellors, Inc.) and Counsellors Securities, Inc.
</TABLE>
C-1
<PAGE> 15
<TABLE>
<C> <S>
(6)8.2(b) Service Agreement between Warburg Pincus Asset Management Inc. (f/k/a Warburg Pincus Counsellors, Inc.)
and Federal Kemper Life Assurance Company and Kemper Investors Life Insurance Company.
8.2(c) Restatement of Participation Agreement among Counsellors Securities Inc., Warburg Pincus Asset
Management, Inc. and/or the Warburg Pincus Funds and Kemper Investors Life Insurance Company.
(8)8.3 Fund Participation Agreement among KILICO, Investors Fund Series (formerly known as Kemper Investors
Fund), Zurich Kemper Investments, Inc. and Kemper Distributors, Inc.
(9)8.4(a) Participation Agreement between Kemper Investors Life Insurance Company and Scudder Variable Life
Investment Fund.
(9)8.4(b) Participating Contract and Policy Agreement between Kemper Investors Life Insurance Company and Scudder
Kemper Investments, Inc.
(9)8.4(c) Indemnification Agreement between Kemper Investors Life Insurance Company and Scudder Kemper
Investments, Inc.
(9)8.5 Participation Agreement Among Kemper Investors Life Insurance Company, PIMCO Variable Insurance Trust,
and PIMCO Funds Distributors LLC.
(9)8.6 Participation Agreement Among Templeton Variable Products Series Fund, Franklin Templeton Distributors,
Inc. and Kemper Investors Life Insurance Company.
(7)9. Opinion and Consent of Counsel.
(14)10.1 Consents of PricewaterhouseCoopers LLP, independent accountants
(14)10.2 Consent of KPMG LLP, independent auditors
11. Inapplicable.
12. Inapplicable.
(4)13. Schedules for Computation of Performance Calculations.
(14)14. Organizational Chart.
(13)17.1 Schedule IV: Reinsurance (year ended December 31, 1998).
(10)17.2 Schedule IV: Reinsurance (year ended December 31, 1997).
(12)17.3 Schedule IV: Reinsurance (year ended December 31, 1996).
(13)17.4 Schedule V: Valuation and qualifying accounts (year ended December 31, 1998).
(10)17.5 Schedule V: Valuation and qualifying accounts (year ended December 31, 1997).
(11)17.6 Schedule V: Valuation and qualifying accounts (year ended December 31, 1996).
</TABLE>
- ---------------
(1) Incorporated by reference to Post-Effective Amendment No. 22 to the
Registration Statement on Form N-4 filed on or about April 27, 1995.
(2) Incorporated by reference to Post-Effective Amendment No. 23 to the
Registration Statement on Form N-4 filed on or about September 14, 1995.
(3) Incorporated by reference to Exhibits filed with the Registration Statement
on Form S-1 for KILICO (File No. 333-02491) filed on or about April 12,
1996.
(4) Incorporated by reference to the Registration Statement on Form N-4 for the
Registrant (File No. 333-22375) filed on or about February 26, 1997.
(5) Incorporated by reference to Post-Effective Amendment No. 25 to the
Registration Statement on Form N-4 (File No. 2-72671) filed on or about
April 28, 1997.
(6) Incorporated by reference to Post-Effective Amendment No. 4 to the
Registration Statement on Form S-6 (File No. 33-79808) filed on or about
April 30, 1997.
(7) Incorporated by reference to Pre-Effective Amendment No. 1 to the
Registration Statement on Form N-4 (File No. 333-22375) filed on or about
November 3, 1997.
(8) Incorporated by reference to Amendment No. 3 to the Registration Statement
on Form S-1 (File No. 333-22389) filed on or about April 8, 1998.
(9) Incorporated by reference to Amendment No. 5 to the Registration Statement
on Form S-1 (File No. 333-22389) filed on or about April 20, 1999.
C-2
<PAGE> 16
(10) Incorporated by reference to Post-Effective Amendment No. 11 to the
Registration Statement on Form N-4 (File No. 33-43501) filed on or about
April 16, 1998.
(11) Incorporated by reference to Amendment No. 2 to the Registration Statement
on Form S-1 for KILICO (File No. 333-02491) filed on or about April 23,
1997.
(12) Incorporated by reference to Form 10-K for Kemper Investors Life Insurance
Company for fiscal year ended December 31, 1996 filed on or about March 25,
1997.
(13) Incorporated by reference to Amendment No. 4 to the Registration Statement
on Form S-1 for KILICO (File No. 333-02491) filed on or about April 20,
1999.
(14) Incorporated by reference to Post-Effective Amendment No. 4 to the
Registration Statement on Form N-4 for the Registrant (File No. 333-22375)
filed on or about April 27, 1999.
ITEM 25. DIRECTORS AND OFFICERS OF KEMPER INVESTORS LIFE INSURANCE COMPANY
The directors and principal officers of KILICO are listed below
together with their current positions. The address of each officer and
director is 1 Kemper Drive, Long Grove, Illinois 60049.
<TABLE>
<CAPTION>
NAME OFFICE WITH KILICO
---- ------------------
<S> <C>
Gale K. Caruso....................... President, Chief Executive Officer and Director
Frederick L. Blackmon................ Senior Vice President and Chief Financial Officer
Edward L. Robbins.................... Senior Vice President and Chief Actuary
James E. Hohmann..................... Senior Vice President and Director
John B. Scott........................ Chairman of the Board and Director
David A. Bowers...................... Director
William H. Bolinder.................. Director
Gunther Gose......................... Director
Eliane C. Frye....................... Executive Vice President and Director
Debra P. Rezabek..................... Senior Vice President, General Counsel and Corporate
Secretary
James C. Harkensee................... Senior Vice President
Edward K. Loughridge................. Senior Vice President and Corporate Development Officer
Kenneth M. Sapp...................... Senior Vice President
George Vlaisavljevich................ Senior Vice President
Russell M. Bostick................... Senior Vice President and Chief Information Officer
</TABLE>
ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE INSURANCE
COMPANY OR REGISTRANT
See Exhibit 14 for organizational charts of persons controlled or
under common control with Kemper Investors Life Insurance Company.
Investors Brokerage Services, Inc. and Investors Brokerage Services
Insurance Agency, Inc. are wholly owned subsidiaries of KILICO.
ITEM 27. NUMBER OF CONTRACT OWNERS
At August 1, 1999, the Registrant had approximately 4,016 qualified
and non-qualified Kemper Destinations Contract Owners.
At August 1, 1999, the Registrant had approximately 24 qualified and
non-qualified Farmers Variable Annuity I Contract Owners.
ITEM 28. INDEMNIFICATION
To the extent permitted by law of the State of Illinois and subject to
all applicable requirements thereof, Article VI of the By-Laws of Kemper
Investors Life Insurance Company ("KILICO") provides for the
indemnification of any person against all expenses (including attorneys
fees), judgments, fines, amounts paid in settlement and other costs
actually and reasonably incurred by him in connection with any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative in which he is a party or is threatened to
be made a party by reason of his being or having been a director, officer,
employee or agent of KILICO, or serving or having served, at the request of
KILICO, as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, or by reason of his
holding a fiduciary position in connection with the management or
administration of retirement, pension, profit sharing or other benefit
plans including, but not limited to, any fiduciary liability under the
Employee Retirement Income Security Act of 1974 and any amendment thereof,
if he acted in
C-3
<PAGE> 17
good faith and in a manner he reasonably believed to be in and not opposed
to the best interests of KILICO, and with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of NOLO CONTENDERE or its
equivalent, shall not, of itself, create a presumption that he did not act
in good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of KILICO, and, with respect to any criminal
action or proceeding, had reasonable cause to believe that his conduct was
unlawful. No indemnification shall be made in respect of any claim, issue
or matter as to which a director or officer shall have been adjudged to be
liable for negligence or misconduct in the performance of his duty to the
company, unless and only to the extent that the court in which such action
or suit was brought or other court of competent jurisdiction shall
determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, he is fairly and reasonably
entitled to indemnity for such expenses as the court shall deem proper.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, employees
or agents of KILICO pursuant to the foregoing provisions, or otherwise,
KILICO has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in
that Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by KILICO
of expenses incurred or paid by a director, officer, employee of agent of
KILICO in the successful defense of any action, suit or proceeding) is
asserted by such director, officer, employee or agent of KILICO in
connection with variable annuity contracts, KILICO will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by KILICO is against public policy as
expressed in that Act and will be governed by the final adjudication of
such issue.
ITEM 29.(A) PRINCIPAL UNDERWRITER
Investors Brokerage Services, Inc., a wholly owned subsidiary of
Kemper Investors Life Insurance Company, acts as principal underwriter for
KILICO Variable Annuity Separate Account, KILICO Variable Separate Account,
KILICO Variable Separate Account-2, Kemper Investors Life Insurance Company
Variable Annuity Account C and FKLA Variable Separate Account.
ITEM 29.(B) INFORMATION REGARDING PRINCIPAL UNDERWRITER, INVESTORS BROKERAGE
SERVICES, INC.
The address of each officer is 1 Kemper Drive, Long Grove, IL 60049.
<TABLE>
<CAPTION>
POSITION AND OFFICES
NAME WITH UNDERWRITER
---- --------------------
<S> <C>
John B. Scott....................................... Chairman and Director
Michael E. Scherrman................................ President and Director
Otis R. Heldman, Jr. ............................... Vice President
Michael A. Kelly.................................... Vice President
David S. Jorgensen.................................. Vice President and Treasurer
Debra P. Rezabek.................................... Secretary
Frank J. Julian..................................... Assistant Secretary
Kenneth M. Sapp..................................... Director
Eliane C. Frye...................................... Director
George Vlaisavljevich............................... Director
</TABLE>
ITEM 29.(C)
Inapplicable.
ITEM 30. LOCATION OF ACCOUNTS AND RECORDS
Accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules
promulgated thereunder are maintained by Kemper Investors Life Insurance
Company at its home office at 1 Kemper Drive, Long Grove, Illinois 60049.
ITEM 31. MANAGEMENT SERVICES
Inapplicable.
C-4
<PAGE> 18
ITEM 32. UNDERTAKINGS AND REPRESENTATION
a. Registrant hereby undertakes to file a post-effective amendment to
this registration statement as frequently as is necessary to ensure that
the audited financial statements in the registration statement are never
more than sixteen (16) months old for so long as payment under the variable
annuity contracts may be accepted.
b. Registrant hereby undertakes to include either (1) as part of any
application to purchase a contract offered by the Prospectus, a space that
an applicant can check to request a Statement of Additional Information, or
(2) a postcard or similar written communication affixed to or included in
the Prospectus that the applicant can remove to send for a Statement of
Additional Information.
c. Registrant hereby undertakes to deliver any Statement of Additional
Information and any financial statement required to be made available under
this Form promptly upon written or oral request.
REPRESENTATION REGARDING FEES AND CHARGES PURSUANT TO SECTION 26 OF THE
INVESTMENT COMPANY ACT OF 1940
Kemper Investors Life Insurance Company ("KILICO") represents that the
fees and charges deducted under the Contract, in the aggregate, are
reasonable in relation to the services rendered, the expenses expected to
be incurred, and the risks assumed by KILICO.
REPRESENTATION REGARDING CONTRACTS ISSUED TO PARTICIPANTS IN THE TEXAS OPTIONAL
RETIREMENT PROGRAM
KILICO, depositor and sponsor of Registrant, KILICO Variable Annuity
Separate Account, and Investors Brokerage Services, Inc., the principal
underwriter of the Individual and Group Variable, Fixed and Market Value
Adjusted Deferred Annuity Contracts (the "Contracts") issued by Registrant,
will issue the Contracts to participants in the Texas Optional Retirement
Program (the "Program") in reliance upon, and in compliance with, Rule 6c-7
of the Investment Company Act of 1940, and represent that they will:
1. Include appropriate disclosure regarding the restrictions on
redemptions imposed by the Program in each registration statement,
including the prospectus, used in connection with the Program;
2. Include appropriate disclosure regarding the restrictions on
redemptions imposed by the Program in any sales literature used in
connection with the offer of Contracts to Program participants;
3. Instruct salespeople who solicit Program participants to purchase
Contracts specifically to bring the restrictions on redemption imposed by
the Program to the attention of potential Program participants; and
4. Obtain from each Program participant who purchases a Contract in
connection with the Program, prior to or at the time of such purchase, a
signed statement acknowledging the restrictions on redemption imposed by
the Program.
REPRESENTATION REGARDING CONTRACTS ISSUED TO PARTICIPANTS OF TAX-SHELTERED
ANNUITY PROGRAMS
KILICO, depositor and sponsor of Registrant, KILICO Variable Annuity
Separate Account (the "Separate Account"), and Investors Brokerage
Services, Inc. ("IBS"), the principal underwriter of the Individual and
Group Variable, Fixed and Market Value Adjusted Deferred Annuity Contracts
(the "Contracts") issued by Registrant, will issue the Contracts to
participants in IRC 403(b) Tax-Sheltered Annuity Programs in reliance upon,
and in compliance with, the no-action letter dated November 28, 1988 to
American Council of Life Insurance. In connection therewith, KILICO, the
Separate Account and IBS represent that they will:
1. Include appropriate disclosure regarding the restrictions on
redemptions imposed by IRC Section 403(b)(11) in each registration
statement, including the prospectus, used in connection with IRC 403(b)
Tax-Sheltered Annuity Programs;
2. Include appropriate disclosure regarding the restrictions on
redemptions imposed by IRC Section 403(b)(11) in any sales literature used
in connection with the offer of Contracts to 403(b) participants;
3. Instruct salespeople who solicit participants to purchase Contracts
specifically to bring the restrictions on redemption imposed by 403(b)(11)
to the attention of potential participants; and
4. Obtain from each participant who purchases an IRC Section 403(b)
annuity contract, prior to or at the time of such purchase, a signed
statement acknowledging the restrictions on redemption imposed by IRC
Section 403(b) and the investment alternatives available under the
employer's IRC Section 403(b) arrangement, to which the participant may
elect to transfer his or her contract value.
C-5
<PAGE> 19
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, the Registrant, KILICO Variable Annuity Separate Account, certifies that
it meets the requirements of Securities Act Rule 485(b) for effectiveness of
this Amendment to the Registration Statement, and has caused this Amendment to
be signed on its behalf by the undersigned in the City of Long Grove and State
of Illinois on the 10th day of September, 1999.
KILICO VARIABLE ANNUITY SEPARATE
ACCOUNT
(Registrant)
By: Kemper Investors Life Insurance
Company
BY: /s/ GALE K. CARUSO
-------------------------------------
Gale K. Caruso, President and Chief
Executive Officer
KEMPER INVESTORS LIFE INSURANCE COMPANY
(Depositor)
BY: /s/ GALE K. CARUSO
-------------------------------------
Gale K. Caruso, President and Chief
Executive Officer
As required by the Securities Act of 1933, this Amendment to the Registration
Statement has been signed below by the following directors and principal
officers of Kemper Investors Life Insurance Company in the capacities indicated
on the 10th day of September, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ GALE K. CARUSO President, Chief Executive Officer and Director
- ----------------------------------------------------- (Principal Executive Officer)
Gale K. Caruso
/s/ JOHN B. SCOTT Chairman of the Board and Director
- -----------------------------------------------------
John B. Scott
/s/ FREDERICK L. BLACKMON Senior Vice President and Chief Financial
- ----------------------------------------------------- Officer
Frederick L. Blackmon (Principal Financial Officer and
Principal Accounting Officer)
/s/ W.H. BOLINDER Director
- -----------------------------------------------------
William H. Bolinder
/s/ DAVID A. BOWERS Director
- -----------------------------------------------------
David A. Bowers
/s/ ELIANE C. FRYE Director
- -----------------------------------------------------
Eliane C. Frye
/s/ GUNTHER GOSE Director
- -----------------------------------------------------
Gunther Gose
/s/ JAMES E. HOHMANN Director
- -----------------------------------------------------
James E. Hohmann
</TABLE>
C-6
<PAGE> 20
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT PAGE
NUMBER TITLE NUMBER*
- ------- ----- ----------
<C> <S> <C>
8.2(c) Restatement of Participation Agreement among Counsellors
Securities, Inc., Warburg Pincus Asset Management, Inc.
and/or the Warburg Pincus Funds and Kemper Investors Life
Insurance Company...........................................
</TABLE>
<PAGE> 1
EXHIBIT 8.2(c)
Kemper Investors Life Insurance
RESTATEMENT
OF PARTICIPATION AGREEMENT
AGREEMENT, dated as of June 10, 1999, among Counsellors Securities Inc.
("CSI"), Warburg Pincus Asset Management, Inc. ("Warburg") and/or the Warburg
Pincus Funds listed on Schedule 1 (each a "Fund" and collectively the "Funds",
and together with CSI and Warburg, the "Warburg Parties") and the undersigned
service organization (the "Service Organization").
WHEREAS, the parties listed above have entered into one or more agreements
and fee letters (collectively, as amended to date, the "Participation
Agreement") pursuant to which the Service Organization provides certain services
for beneficial investors in shares of one or more Fund portfolios through an
insurance company separate account; and
WHEREAS, Credit Suisse Group ("Credit Suisse") (i) has agreed to acquire
the parent companies of Warburg and CSI (the "Acquisition") and, simultaneously
or within a short time thereafter, (ii) intends to combine CSI's immediate
parent company, Warburg, with Credit Suisse's indirect, wholly-owned U.S. asset
management subsidiary, Credit Suisse Asset Management, LLC, and in connection
therewith reorganize ownership of CSI such that CSI will no longer be a
subsidiary of Warburg, but will become a separate indirect, wholly-owned
subsidiary of Credit Suisse (the "Reorganization"); and
WHEREAS, the Acquisition and the Reorganization may each constitute an
"assignment" (as defined in the Investment Company Act of 1940, as amended
(each, an "Assignment")) of the Participation Agreement by one or more Warburg
Parties; and
WHEREAS, CSI will be required to cease serving as Fund distributor within a
limited period of time following the Acquisition, and Provident Distributors,
Inc. ("PDI") will be appointed as Fund distributor.
NOW, THEREFORE, in consideration of the premises, the parties hereto agree
as follows:
1. Notwithstanding anything in the Participation Agreement to the contrary,
this Agreement restates and incorporates by reference the Participation
Agreement as of the effective date(s) of the Acquisition and the Reorganization.
Without limiting the generality of the foregoing, following the effective
dates(s) of each Assignment, except as contemplated herein (including section 3
below), the relevant Warburg Parties agree to continue to be responsible for the
same obligations and will make the same representations, warranties and
covenants (including any obligations to pay fees) as set forth in the
Participation Agreement, and the Service Organization agrees to make the same
representations, warranties and covenants and perform the same services as set
forth in the Participation Agreement.
2. With the occurrence of each Assignment, the Participation Agreement will be
deemed to terminate and to have been superseded by this Agreement (including the
Participation Agreement incorporated by reference). Consequently, in
interpreting the responsibilities of the parties following the effective date(s)
of the Acquisition and the Reorganization, reference to the Participation
Agreement shall mean this Agreement and any subsequent restatements and
amendments thereof.
3. The relevant Warburg Parties reserve the right (without further consent
from Service Organization) to enter into an agreement pursuant to which CSI as
Fund distributor would assign CSI's responsibilities as such to PDI (pursuant to
which agreement PDI shall assume responsibility for the obligations,
representations, warranties and covenants of CSI, in its capacity as Fund
distributor, under the Participation Agreement), in which case all references to
CSI in the Participation Agreement shall be deemed to represent, as appropriate,
a reference to CSI and/or PDI.
4. Notwithstanding anything in the Participation Agreement to the contrary,
the Funds covered by the
<PAGE> 2
Participation Agreement shall consist of those open-end investment companies
(and portfolios thereof) that hold themselves out as part of the Warburg Pincus
family of funds and which were established to serve as investment vehicles for
separate accounts that issue variable annuity and variable life insurance
contracts (currently listed on Schedule 1).
5. Except as contemplated herein, the provisions of the Participation
Agreement are ratified and affirmed in all respects.
IN WITNESS WHEREOF, each of the parties has executed this Agreement by a
duly authorized officer as of the date first above written.
KEMPER INVESTORS LIFE INSURANCE
By: /s/ Otis R. Heldman, Jr.
-----------------------------
Name: Otis R. Heldman, Jr.
-----------------------------
Title: Vice President - Marketing
-----------------------------
Date: 6/21/99
-----------------------------
COUNSELLORS SECURITIES INC.
WARBURG PINCUS ASSET MANAGEMENT, INC.
EACH OF THE WARBURG PINCUS FUNDS LISTED ON SCHEDULE 1
By: /s/ Janna Manes
-----------------------------
Name: Janna Manes
Title: Vice President and Secretary
<PAGE> 3
Schedule 1
----------
Warburg Pincus Trust
Emerging Growth Portfolio
Emerging Markets Portfolio
Growth & Income Portfolio
International Equity Portfolio
Post-Venture Capital Portfolio
Small Company Growth Portfolio
Warburg Pincus Trust II
Fixed Income Portfolio
Global Fixed Income Portfolio
