<PAGE> PAGE 1
000 B000000 09/30/98
000 C000000 0000701638
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0
000 J000000 A
001 A000000 KEMPER PORTFOLIOS
001 B000000 811-3440
001 C000000 3125377000
002 A000000 222 SOUTH RIVERSIDE PLAZA
002 B000000 CHICAGO
002 C000000 IL
002 D010000 60606
002 D020000 5808
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 Y
007 B000000 3
007 C010100 1
007 C010200 2
007 C010300 3
007 C020300 KEMPER CASH RESERVES FUND
007 C030300 N
007 C010400 4
007 C010500 5
007 C020500 KEMPER U.S. MORTGAGE FUND
007 C030500 N
007 C010600 6
007 C010700 7
007 C020700 KEMPER SHORT-INTERMEDIATE GOVERNMENT FUND
007 C030700 N
007 C010800 8
007 C010900 9
007 C011000 10
008 A00AA01 SCUDDER KEMPER INVESTMENTS, INC.
008 B00AA01 A
008 C00AA01 801-44899
008 D01AA01 NEW YORK
008 D02AA01 NY
008 D03AA01 10154
008 D04AA01 0100
010 A00AA01 KEMPER DISTRIBUTORS, INC.
010 B00AA01 8-47765
010 C01AA01 CHICAGO
010 C02AA01 IL
010 C03AA01 60606
<PAGE> PAGE 2
010 C04AA01 5808
011 A00AA01 KEMPER DISTRIBUTORS, INC.
011 B00AA01 8-47765
011 C01AA01 CHICAGO
011 C02AA01 IL
011 C03AA01 60606
011 C04AA01 5808
012 A00AA01 KEMPER SERVICE COMPANY
012 B00AA01 84-1713
012 C01AA01 KANSAS CITY
012 C02AA01 MO
012 C03AA01 64105
013 A00AA01 ERNST & YOUNG LLP
013 B01AA01 CHICAGO
013 B02AA01 IL
013 B03AA01 60606
014 A00AA01 SCUDDER INVESTORS SERVICES, INC.
014 B00AA01 8-298
014 A00AA02 KEMPER DISTRIBUTORS, INC.
014 B00AA02 8-47765
014 A00AA03 GRUNTAL & CO., INC.
014 B00AA03 8-31022
014 A00AA04 THE GMS GROUP, L.L.C. (A GRUNTAL AFFILIATE)
014 B00AA04 8-23936
014 A00AA05 ZURICH CAPITAL MARKETS
014 B00AA05 8-49827
014 A00AA06 BANK HANDLOWY
014 B00AA06 8-24613
015 A00AA01 INVESTORS FIDUCIARY TRUST COMPANY
015 B00AA01 C
015 C01AA01 KANSAS CITY
015 C02AA01 MO
015 C03AA01 64105
015 E01AA01 X
015 A00AA02 STATE STREET BANK AND TRUST COMPANY
015 B00AA02 S
015 C01AA02 BOSTON
015 C02AA02 MA
015 C03AA02 02110
015 E01AA02 X
018 00AA00 Y
019 A00AA00 Y
019 B00AA00 71
019 C00AA00 KEMPERFNDS
020 A000001 MERRILL LYNCH, PIERCE, FENNER & SMITH
020 B000001 13-5674085
020 C000001 311
020 A000002 GOLDMAN, SACHS & CO.
020 B000002 13-5108880
020 C000002 121
020 A000003 COMMERZBANK CAPITAL MARKETS CORP.
<PAGE> PAGE 3
020 B000003 13-3439358
020 C000003 118
020 A000004 GELBER SECURITIES INC.
020 B000004 UNKNOWN
020 C000004 49
020 A000005 PAINEWEBBER INCORPORATED
020 B000005 13-2638166
020 C000005 32
020 A000006 LIT CLEARING SERVICES, INC.
020 B000006 36-3890396
020 C000006 27
020 A000007 MORGAN STANLEY DISCOVER & CO.
020 B000007 13-2655998
020 C000007 16
020 A000008 DEUTSCHE BANK GOVERNMENT SECURITIES, INC.
020 B000008 13-2730828
020 C000008 9
020 A000009 SALOMON BROTHERS INC.
020 B000009 13-3082694
020 C000009 2
020 C000010 0
021 000000 685
022 A000001 NOMURA SECURITIES INTERNATIONAL, INC.
022 B000001 13-2642206
022 C000001 12198250
022 D000001 110268
022 A000002 SALOMON BROTHERS INC.
022 B000002 13-3082694
022 C000002 9501229
022 D000002 1299559
022 A000003 LEHMAN BROTHERS INC.
022 B000003 13-2518466
022 C000003 2600419
022 D000003 809878
022 A000004 GOLDMAN, SACHS & CO.
022 B000004 13-5108880
022 C000004 2733538
022 D000004 563883
022 A000005 MERRILL LYNCH, PIERCE, FENNER & SMITH INC.
022 B000005 13-5674085
022 C000005 2044006
022 D000005 899995
022 A000006 CS FIRST BOSTON CORPORATION
022 B000006 13-5659485
022 C000006 1940984
022 D000006 466392
022 A000007 NIKKO SECURITIES CO. INTERNATIONAL, INC.
022 B000007 94-1302123
022 C000007 1619400
022 D000007 0
022 A000008 PAINEWEBBER INCORPORATED
<PAGE> PAGE 4
022 B000008 13-2638166
022 C000008 420050
022 D000008 439001
022 A000009 CHASE SECURITIES, INC.
022 B000009 13-3112953
022 C000009 682994
022 D000009 69836
022 A000010 MORGAN STANLEY DISCOVER & CO.
022 B000010 13-2655998
022 C000010 689556
022 D000010 57117
023 C000000 35567820
023 D000000 5431997
026 A000000 Y
026 B000000 Y
026 C000000 Y
026 D000000 Y
026 E000000 N
026 F000000 N
026 G010000 N
026 G020000 N
026 H000000 N
027 000000 Y
037 00AA00 N
038 00AA00 0
039 00AA00 Y
040 00AA00 Y
041 00AA00 Y
049 00AA00 N
050 00AA00 N
051 00AA00 N
052 00AA00 N
053 A00AA00 N
054 A00AA00 Y
054 B00AA00 Y
054 C00AA00 N
054 D00AA00 N
054 E00AA00 N
054 F00AA00 N
054 G00AA00 N
054 H00AA00 Y
054 I00AA00 N
054 J00AA00 Y
054 K00AA00 N
054 L00AA00 N
054 M00AA00 Y
054 N00AA00 N
054 O00AA00 Y
055 A00AA00 Y
055 B00AA00 N
056 00AA00 Y
<PAGE> PAGE 5
057 00AA00 N
058 A00AA00 N
059 00AA00 Y
060 A00AA00 Y
060 B00AA00 Y
061 00AA00 1000
066 A00AA00 N
067 00AA00 N
068 A00AA00 N
068 B00AA00 N
069 00AA00 N
077 A000000 Y
077 B000000 Y
077 C000000 N
077 D000000 N
077 E000000 N
077 F000000 N
077 G000000 N
077 H000000 N
077 I000000 N
077 J000000 N
077 K000000 N
077 L000000 N
077 M000000 N
077 N000000 N
077 O000000 N
077 P000000 N
077 Q010000 Y
077 Q020000 N
077 Q030000 Y
078 000000 N
080 A00AA00 ICI MUTUAL INSURANCE COMPANY
080 C00AA00 6000
081 A00AA00 Y
081 B00AA00 109
082 A00AA00 N
082 B00AA00 0
083 A00AA00 N
083 B00AA00 0
084 A00AA00 N
084 B00AA00 0
085 A00AA00 Y
085 B00AA00 N
024 000300 Y
025 A000301 GOLDMAN, SACHS & CO.
025 B000301 13-5108880
025 C000301 D
025 D000301 5000
025 A000302 LEHMAN BROTHERS INC.
025 B000302 13-3216325
025 C000302 D
<PAGE> PAGE 6
025 D000302 5000
025 A000303 MERRILL LYNCH, PIERCE, FENNER & SMITH INC.
025 B000303 13-5674085
025 C000303 D
025 D000303 7000
025 A000304 MORGAN STANLEY DISCOVER & CO.
025 B000304 13-2655998
025 C000304 D
025 D000304 5000
025 A000305 NOMURA SECURITIES INTERNATIONAL, INC.
025 B000305 13-2642206
025 C000305 D
025 D000305 4978
025 D000306 0
025 D000307 0
025 D000308 0
028 A010300 235801
028 A020300 541
028 A030300 0
028 A040300 230493
028 B010300 365166
028 B020300 603
028 B030300 0
028 B040300 354385
028 C010300 422428
028 C020300 756
028 C030300 0
028 C040300 409195
028 D010300 459415
028 D020300 651
028 D030300 0
028 D040300 508913
028 E010300 757187
028 E020300 1116
028 E030300 0
028 E040300 386336
028 F010300 545271
028 F020300 1444
028 F030300 0
028 F040300 578343
028 G010300 2785268
028 G020300 5111
028 G030300 0
028 G040300 2467665
028 H000300 0
029 000300 N
030 A000300 0
030 B000300 0.00
030 C000300 0.00
031 A000300 0
031 B000300 0
<PAGE> PAGE 7
032 000300 0
033 000300 0
034 000300 Y
035 000300 837
036 A000300 N
036 B000300 0
042 A000300 0
042 B000300 0
042 C000300 0
042 D000300 0
042 E000300 0
042 F000300 0
042 G000300 0
042 H000300 100
043 000300 1388
044 000300 5926
045 000300 Y
046 000300 N
047 000300 Y
048 000300 0.000
048 A010300 250000
048 A020300 0.400
048 B010300 750000
048 B020300 0.380
048 C010300 1500000
048 C020300 0.350
048 D010300 2500000
048 D020300 0.320
048 E010300 2500000
048 E020300 0.300
048 F010300 2500000
048 F020300 0.280
048 G010300 2500000
048 G020300 0.260
048 H010300 0
048 H020300 0.000
048 I010300 0
048 I020300 0.000
048 J010300 0
048 J020300 0.000
048 K010300 12500000
048 K020300 0.250
062 A000300 Y
062 B000300 0.0
062 C000300 28.2
062 D000300 0.0
062 E000300 0.0
062 F000300 5.5
062 G000300 1.8
062 H000300 0.0
062 I000300 63.8
<PAGE> PAGE 8
062 J000300 0.0
062 K000300 0.0
062 L000300 0.0
062 M000300 0.0
062 N000300 0.0
062 O000300 0.0
062 P000300 0.0
062 Q000300 0.0
062 R000300 0.0
063 A000300 23
063 B000300 0.0
064 A000300 Y
064 B000300 N
070 A010300 Y
070 A020300 Y
070 B010300 N
070 B020300 N
070 C010300 N
070 C020300 N
070 D010300 N
070 D020300 N
070 E010300 N
070 E020300 N
070 F010300 N
070 F020300 N
070 G010300 N
070 G020300 N
070 H010300 N
070 H020300 N
070 I010300 N
070 I020300 N
070 J010300 Y
070 J020300 Y
070 K010300 N
070 K020300 N
070 L010300 Y
070 L020300 Y
070 M010300 N
070 M020300 N
070 N010300 Y
070 N020300 N
070 O010300 N
070 O020300 N
070 P010300 N
070 P020300 N
070 Q010300 N
070 Q020300 N
070 R010300 N
070 R020300 N
071 A000300 0
071 B000300 0
<PAGE> PAGE 9
071 C000300 0
071 D000300 0
072 A000300 12
072 B000300 16532
072 C000300 0
072 D000300 0
072 E000300 0
072 F000300 1269
072 G000300 655
072 H000300 0
072 I000300 0
072 J000300 1800
072 K000300 0
072 L000300 177
072 M000300 28
072 N000300 0
072 O000300 0
072 P000300 0
072 Q000300 0
072 R000300 25
072 S000300 2
072 T000300 1388
072 U000300 0
072 V000300 0
072 W000300 115
072 X000300 5459
072 Y000300 0
072 Z000300 11073
072AA000300 0
072BB000300 0
072CC010300 0
072CC020300 0
072DD010300 3961
072DD020300 7112
072EE000300 0
073 A010300 0.0000
073 A020300 0.0000
073 B000300 0.0000
073 C000300 0.0000
074 A000300 260
074 B000300 0
074 C000300 545816
074 D000300 0
074 E000300 0
074 F000300 0
074 G000300 0
074 H000300 0
074 I000300 0
074 J000300 0
074 K000300 0
074 L000300 9081
<PAGE> PAGE 10
074 M000300 0
074 N000300 555157
074 O000300 0
074 P000300 471
074 Q000300 0
074 R010300 0
074 R020300 0
074 R030300 0
074 R040300 5297
074 S000300 0
074 T000300 549389
074 U010300 196771
074 U020300 352618
074 V010300 1.00
074 V020300 1.00
074 W000300 0.9999
074 X000300 53352
074 Y000300 0
075 A000300 289686
075 B000300 0
076 000300 0.00
024 000500 N
028 A010500 4208
028 A020500 7815
028 A030500 0
028 A040500 44518
028 B010500 1940
028 B020500 7249
028 B030500 0
028 B040500 42562
028 C010500 3397
028 C020500 7187
028 C030500 0
028 C040500 48901
028 D010500 2403
028 D020500 7091
028 D030500 0
028 D040500 43482
028 E010500 15408
028 E020500 7065
028 E030500 0
028 E040500 36671
028 F010500 5591
028 F020500 7051
028 F030500 0
028 F040500 29607
028 G010500 32946
028 G020500 43458
028 G030500 0
028 G040500 245742
028 H000500 8852
<PAGE> PAGE 11
029 000500 Y
030 A000500 307
030 B000500 4.50
030 C000500 0.00
031 A000500 35
031 B000500 0
032 000500 272
033 000500 0
034 000500 Y
035 000500 735
036 A000500 N
036 B000500 0
042 A000500 0
042 B000500 0
042 C000500 0
042 D000500 0
042 E000500 0
042 F000500 0
042 G000500 0
042 H000500 100
043 000500 3993
044 000500 0
045 000500 Y
046 000500 N
047 000500 Y
048 000500 0.000
048 A010500 250000
048 A020500 0.550
048 B010500 750000
048 B020500 0.520
048 C010500 1500000
048 C020500 0.500
048 D010500 2500000
048 D020500 0.480
048 E010500 2500000
048 E020500 0.450
048 F010500 2500000
048 F020500 0.430
048 G010500 2500000
048 G020500 0.410
048 H010500 0
048 H020500 0.000
048 I010500 0
048 I020500 0.000
048 J010500 0
048 J020500 0.000
048 K010500 12500000
048 K020500 0.400
062 A000500 Y
062 B000500 0.0
062 C000500 0.0
<PAGE> PAGE 12
062 D000500 0.0
062 E000500 0.0
062 F000500 0.0
062 G000500 0.0
062 H000500 0.0
062 I000500 0.0
062 J000500 0.0
062 K000500 0.0
062 L000500 3.0
062 M000500 12.2
062 N000500 91.3
062 O000500 0.0
062 P000500 0.0
062 Q000500 0.0
062 R000500 0.0
063 A000500 0
063 B000500 5.9
064 A000500 N
064 B000500 N
070 A010500 Y
070 A020500 Y
070 B010500 N
070 B020500 N
070 C010500 Y
070 C020500 N
070 D010500 N
070 D020500 N
070 E010500 Y
070 E020500 Y
070 F010500 N
070 F020500 N
070 G010500 Y
070 G020500 N
070 H010500 N
070 H020500 N
070 I010500 N
070 I020500 N
070 J010500 Y
070 J020500 N
070 K010500 N
070 K020500 N
070 L010500 N
070 L020500 N
070 M010500 N
070 M020500 N
070 N010500 Y
070 N020500 N
070 O010500 N
070 O020500 N
070 P010500 N
070 P020500 N
<PAGE> PAGE 13
070 Q010500 Y
070 Q020500 N
070 R010500 Y
070 R020500 N
071 A000500 4155892
071 B000500 4612372
071 C000500 2408694
071 D000500 173
072 A000500 12
072 B000500 171993
072 C000500 0
072 D000500 0
072 E000500 0
072 F000500 11862
072 G000500 5518
072 H000500 0
072 I000500 0
072 J000500 5328
072 K000500 0
072 L000500 635
072 M000500 47
072 N000500 0
072 O000500 0
072 P000500 0
072 Q000500 0
072 R000500 43
072 S000500 12
072 T000500 3992
072 U000500 0
072 V000500 0
072 W000500 65
072 X000500 27502
072 Y000500 0
072 Z000500 144491
072AA000500 82619
072BB000500 29399
072CC010500 98134
072CC020500 0
072DD010500 118261
072DD020500 30135
072EE000500 0
073 A010500 0.0000
073 A020500 0.0000
073 B000500 0.0000
073 C000500 0.0000
074 A000500 3499
074 B000500 0
074 C000500 66000
074 D000500 2261011
074 E000500 0
074 F000500 0
<PAGE> PAGE 14
074 G000500 0
074 H000500 0
074 I000500 0
074 J000500 59573
074 K000500 0
074 L000500 19842
074 M000500 0
074 N000500 2409925
074 O000500 216261
074 P000500 1603
074 Q000500 0
074 R010500 0
074 R020500 0
074 R030500 0
074 R040500 7886
074 S000500 0
074 T000500 2184175
074 U010500 253562
074 U020500 52113
074 V010500 0.00
074 V020500 0.00
074 W000500 0.0000
074 X000500 136824
074 Y000500 214747
075 A000500 0
075 B000500 2511900
076 000500 0.00
024 000700 N
028 A010700 4458
028 A020700 598
028 A030700 0
028 A040700 8571
028 B010700 4723
028 B020700 543
028 B030700 0
028 B040700 7146
028 C010700 9634
028 C020700 537
028 C030700 0
028 C040700 8098
028 D010700 9121
028 D020700 535
028 D030700 0
028 D040700 13768
028 E010700 10829
028 E020700 567
028 E030700 0
028 E040700 3975
028 F010700 14871
028 F020700 604
028 F030700 0
<PAGE> PAGE 15
028 F040700 7761
028 G010700 53637
028 G020700 3384
028 G030700 0
028 G040700 49319
028 H000700 23198
029 000700 Y
030 A000700 153
030 B000700 3.50
030 C000700 0.00
031 A000700 6
031 B000700 0
032 000700 147
033 000700 0
034 000700 Y
035 000700 197
036 A000700 N
036 B000700 0
042 A000700 0
042 B000700 0
042 C000700 0
042 D000700 0
042 E000700 0
042 F000700 0
042 G000700 0
042 H000700 100
043 000700 742
044 000700 104
045 000700 Y
046 000700 N
047 000700 Y
048 000700 0.000
048 A010700 250000
048 A020700 0.550
048 B010700 750000
048 B020700 0.520
048 C010700 1500000
048 C020700 0.500
048 D010700 2500000
048 D020700 0.480
048 E010700 2500000
048 E020700 0.450
048 F010700 2500000
048 F020700 0.430
048 G010700 2500000
048 G020700 0.410
048 H010700 0
048 H020700 0.000
048 I010700 0
048 I020700 0.000
048 J010700 0
<PAGE> PAGE 16
048 J020700 0.000
048 K010700 12500000
048 K020700 0.400
062 A000700 Y
062 B000700 0.0
062 C000700 0.0
062 D000700 0.0
062 E000700 0.0
062 F000700 0.0
062 G000700 0.0
062 H000700 0.0
062 I000700 0.0
062 J000700 0.0
062 K000700 0.0
062 L000700 7.3
062 M000700 25.6
062 N000700 57.2
062 O000700 0.0
062 P000700 8.7
062 Q000700 0.0
062 R000700 0.0
063 A000700 0
063 B000700 4.0
064 A000700 N
064 B000700 N
070 A010700 Y
070 A020700 Y
070 B010700 N
070 B020700 N
070 C010700 Y
070 C020700 N
070 D010700 N
070 D020700 N
070 E010700 Y
070 E020700 Y
070 F010700 N
070 F020700 N
070 G010700 Y
070 G020700 N
070 H010700 N
070 H020700 N
070 I010700 N
070 I020700 N
070 J010700 Y
070 J020700 N
070 K010700 N
070 K020700 N
070 L010700 Y
070 L020700 N
070 M010700 N
070 M020700 N
<PAGE> PAGE 17
070 N010700 Y
070 N020700 N
070 O010700 N
070 O020700 N
070 P010700 N
070 P020700 N
070 Q010700 Y
070 Q020700 N
070 R010700 Y
070 R020700 N
071 A000700 581727
071 B000700 606442
071 C000700 172375
071 D000700 337
072 A000700 12
072 B000700 11403
072 C000700 0
072 D000700 0
072 E000700 0
072 F000700 920
072 G000700 396
072 H000700 0
072 I000700 0
072 J000700 661
072 K000700 0
072 L000700 92
072 M000700 17
072 N000700 0
072 O000700 0
072 P000700 0
072 Q000700 0
072 R000700 26
072 S000700 1
072 T000700 742
072 U000700 0
072 V000700 0
072 W000700 5
072 X000700 2861
072 Y000700 0
072 Z000700 8542
072AA000700 2953
072BB000700 2800
072CC010700 2930
072CC020700 0
072DD010700 4210
072DD020700 5148
072EE000700 0
073 A010700 0.0000
073 A020700 0.0000
073 B000700 0.0000
073 C000700 0.0000
<PAGE> PAGE 18
074 A000700 3675
074 B000700 0
074 C000700 12893
074 D000700 161853
074 E000700 0
074 F000700 0
074 G000700 0
074 H000700 0
074 I000700 0
074 J000700 3604
074 K000700 0
074 L000700 7351
074 M000700 0
074 N000700 189376
074 O000700 8741
074 P000700 164
074 Q000700 0
074 R010700 0
074 R020700 0
074 R030700 0
074 R040700 3601
074 S000700 0
074 T000700 176870
074 U010700 11601
074 U020700 10813
074 V010700 0.00
074 V020700 0.00
074 W000700 0.0000
074 X000700 16198
074 Y000700 167
075 A000700 0
075 B000700 167953
076 000700 0.00
SIGNATURE PHILIP J. COLLORA
TITLE V.P. & SECRETARY
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FORM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIOS
<SERIES>
<NUMBER> 031
<NAME> KEMPER CASH RESERVES FUND - CLASS A
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 545,816
<INVESTMENTS-AT-VALUE> 545,816
<RECEIVABLES> 9,081
<ASSETS-OTHER> 260
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 555,157
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,768
<TOTAL-LIABILITIES> 5,768
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 549,389
<SHARES-COMMON-STOCK> 196,771
<SHARES-COMMON-PRIOR> 35,807
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 549,389
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 16,532
<OTHER-INCOME> 0
<EXPENSES-NET> (5,459)
<NET-INVESTMENT-INCOME> 11,073
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 11,073
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (3,961)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 2,276,571)
<NUMBER-OF-SHARES-REDEEMED> (2,173,206)
<SHARES-REINVESTED> 2,882
<NET-CHANGE-IN-ASSETS> 209,734
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,269
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 5,459
<AVERAGE-NET-ASSETS> 289,686
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .04
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.04)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 1.21
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FORM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIOS
<SERIES>
<NUMBER> 032
<NAME> KEMPER CASH RESERVES FUND - CLASS B
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 545,816
<INVESTMENTS-AT-VALUE> 545,816
<RECEIVABLES> 9,081
<ASSETS-OTHER> 260
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 555,157
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,768
<TOTAL-LIABILITIES> 5,768
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 549,389
<SHARES-COMMON-STOCK> 284,735
<SHARES-COMMON-PRIOR> 161,911
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 549,389
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 16,532
<OTHER-INCOME> 0
<EXPENSES-NET> (5,459)
<NET-INVESTMENT-INCOME> 11,073
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 11,073
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,956)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 635,811
<NUMBER-OF-SHARES-REDEEMED> (573,166)
<SHARES-REINVESTED> 5,110
<NET-CHANGE-IN-ASSETS> 209,734
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,269
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 5,459
<AVERAGE-NET-ASSETS> 289,686
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .03
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.03)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 2.22
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FORM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIOS
<SERIES>
<NUMBER> 033
<NAME> KEMPER CASH RESERVES FUND - CLASS C
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 545,816
<INVESTMENTS-AT-VALUE> 545,816
<RECEIVABLES> 9,081
<ASSETS-OTHER> 260
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 555,157
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 5,768
<TOTAL-LIABILITIES> 5,768
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 549,389
<SHARES-COMMON-STOCK> 67,833
<SHARES-COMMON-PRIOR> 9,898
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 549,389
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 16,532
<OTHER-INCOME> 0
<EXPENSES-NET> (5,459)
<NET-INVESTMENT-INCOME> 11,073
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 11,073
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (1,156)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 868,930
<NUMBER-OF-SHARES-REDEEMED> (834,049)
<SHARES-REINVESTED> 851
<NET-CHANGE-IN-ASSETS> 209,734
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,269
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 5,459
<AVERAGE-NET-ASSETS> 289,686
<PER-SHARE-NAV-BEGIN> 1.00
<PER-SHARE-NII> .04
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> (.04)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 1.00
<EXPENSE-RATIO> 1.88
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIO
<SERIES>
<NUMBER> 051
<NAME> KEMPER U.S. MORTGAGE FUND - CLASS A
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 2,228,877
<INVESTMENTS-AT-VALUE> 2,327,011
<RECEIVABLES> 79,415
<ASSETS-OTHER> 3,499
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 2,409,925
<PAYABLE-FOR-SECURITIES> 216,621
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 9,489
<TOTAL-LIABILITIES> 225,750
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,700,851
<SHARES-COMMON-STOCK> 253,562
<SHARES-COMMON-PRIOR> 276,108
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (614,810)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 98,134
<NET-ASSETS> 2,184,175
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 171,993
<OTHER-INCOME> 0
<EXPENSES-NET> (27,502)
<NET-INVESTMENT-INCOME> 144,491
<REALIZED-GAINS-CURRENT> 53,220
<APPREC-INCREASE-CURRENT> (5,231)
<NET-CHANGE-FROM-OPS> 192,480
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (118,261)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 43,939
<NUMBER-OF-SHARES-REDEEMED> (53,052)
<SHARES-REINVESTED> 9,729
<NET-CHANGE-IN-ASSETS> (313,650)
<ACCUMULATED-NII-PRIOR> 43,951
<ACCUMULATED-GAINS-PRIOR> (916,606)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 11,862
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 27,502
<AVERAGE-NET-ASSETS> 2,318,929
<PER-SHARE-NAV-BEGIN> 7.01
<PER-SHARE-NII> .44
<PER-SHARE-GAIN-APPREC> .17
<PER-SHARE-DIVIDEND> (.47)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.15
<EXPENSE-RATIO> .97
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIO
<SERIES>
<NUMBER> 052
<NAME> KEMPER U.S. MORTGAGE FUND - CLASS B
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 2,228,877
<INVESTMENTS-AT-VALUE> 2,327,011
<RECEIVABLES> 79,415
<ASSETS-OTHER> 3,499
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 2,409,925
<PAYABLE-FOR-SECURITIES> 216,261
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 9,489
<TOTAL-LIABILITIES> 225,750
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,700,851
<SHARES-COMMON-STOCK> 51,578
<SHARES-COMMON-PRIOR> 152,175
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (614,810)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 98,134
<NET-ASSETS> 2,184,175
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 171,993
<OTHER-INCOME> 0
<EXPENSES-NET> (27,502)
<NET-INVESTMENT-INCOME> 144,491
<REALIZED-GAINS-CURRENT> 53,220
<APPREC-INCREASE-CURRENT> (5,231)
<NET-CHANGE-FROM-OPS> 192,480
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (29,946)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 4,837
<NUMBER-OF-SHARES-REDEEMED> (58,981)
<SHARES-REINVESTED> 2,592
<NET-CHANGE-IN-ASSETS> (313,650)
<ACCUMULATED-NII-PRIOR> 43,951
<ACCUMULATED-GAINS-PRIOR> (916,606)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 11,862
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 27,502
<AVERAGE-NET-ASSETS> 2,318,929
<PER-SHARE-NAV-BEGIN> 7.00
<PER-SHARE-NII> .40
<PER-SHARE-GAIN-APPREC> .14
<PER-SHARE-DIVIDEND> (.40)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.14
<EXPENSE-RATIO> 1.91
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIO
<SERIES>
<NUMBER> 053
<NAME> KEMPER U.S. MORTGAGE FUND - CLASS C
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 2,228,877
<INVESTMENTS-AT-VALUE> 2,327,011
<RECEIVABLES> 79,415
<ASSETS-OTHER> 3,499
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 2,409,925
<PAYABLE-FOR-SECURITIES> 216,261
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 9,489
<TOTAL-LIABILITIES> 225,750
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 2,700,851
<SHARES-COMMON-STOCK> 535
<SHARES-COMMON-PRIOR> 245
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (614,810)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 98,134
<NET-ASSETS> 2,184,175
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 171,993
<OTHER-INCOME> 0
<EXPENSES-NET> (27,502)
<NET-INVESTMENT-INCOME> 144,491
<REALIZED-GAINS-CURRENT> 53,220
<APPREC-INCREASE-CURRENT> (5,231)
<NET-CHANGE-FROM-OPS> 192,480
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (189)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 222
<NUMBER-OF-SHARES-REDEEMED> (91)
<SHARES-REINVESTED> 12
<NET-CHANGE-IN-ASSETS> (313,650)
<ACCUMULATED-NII-PRIOR> 43,951
<ACCUMULATED-GAINS-PRIOR> (916,606)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 11,862
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 27,502
<AVERAGE-NET-ASSETS> 2,318,929
<PER-SHARE-NAV-BEGIN> 7.00
<PER-SHARE-NII> .40
<PER-SHARE-GAIN-APPREC> .16
<PER-SHARE-DIVIDEND> (.41)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.15
<EXPENSE-RATIO> 1.73
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIOS
<SERIES>
<NUMBER> 071
<NAME> KEMPER SHORT INTERMEDIATE GOVERNMENT FUND CLASS - A
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 172,490
<INVESTMENTS-AT-VALUE> 174,746
<RECEIVABLES> 10,955
<ASSETS-OTHER> 3,675
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 189,376
<PAYABLE-FOR-SECURITIES> 8,741
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,765
<TOTAL-LIABILITIES> 12,506
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 197,264
<SHARES-COMMON-STOCK> 11,601
<SHARES-COMMON-PRIOR> 4,434
<ACCUMULATED-NII-CURRENT> 258
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (22,908)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,256
<NET-ASSETS> 176,870
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 11,403
<OTHER-INCOME> 0
<EXPENSES-NET> (2,861)
<NET-INVESTMENT-INCOME> 8,542
<REALIZED-GAINS-CURRENT> 153
<APPREC-INCREASE-CURRENT> 2,930
<NET-CHANGE-FROM-OPS> 11,625
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (4,210)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 11,399
<NUMBER-OF-SHARES-REDEEMED> (6,142)
<SHARES-REINVESTED> 404
<NET-CHANGE-IN-ASSETS> 3,203
<ACCUMULATED-NII-PRIOR> 2,353
<ACCUMULATED-GAINS-PRIOR> (17,576)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 920
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,861
<AVERAGE-NET-ASSETS> 167,953
<PER-SHARE-NAV-BEGIN> 7.80
<PER-SHARE-NII> .42
<PER-SHARE-GAIN-APPREC> .17
<PER-SHARE-DIVIDEND> (.48)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.91
<EXPENSE-RATIO> 1.14
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIOS
<SERIES>
<NUMBER> 072
<NAME> KEMPER SHORT INTERMEDIATE GOVERNMENT FUND CLASS - B
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 172,490
<INVESTMENTS-AT-VALUE> 174,746
<RECEIVABLES> 10,955
<ASSETS-OTHER> 3,675
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 189,376
<PAYABLE-FOR-SECURITIES> 8,741
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,765
<TOTAL-LIABILITIES> 12,506
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 197,264
<SHARES-COMMON-STOCK> 9,663
<SHARES-COMMON-PRIOR> 21,117
<ACCUMULATED-NII-CURRENT> 258
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (22,908)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,256
<NET-ASSETS> 176,870
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 11,403
<OTHER-INCOME> 0
<EXPENSES-NET> (2,861)
<NET-INVESTMENT-INCOME> 8,542
<REALIZED-GAINS-CURRENT> 153
<APPREC-INCREASE-CURRENT> 2,930
<NET-CHANGE-FROM-OPS> 11,625
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (4,863)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 3,092
<NUMBER-OF-SHARES-REDEEMED> (9,290)
<SHARES-REINVESTED> 471
<NET-CHANGE-IN-ASSETS> 3,203
<ACCUMULATED-NII-PRIOR> 2,353
<ACCUMULATED-GAINS-PRIOR> (17,576)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 920
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,861
<AVERAGE-NET-ASSETS> 167,953
<PER-SHARE-NAV-BEGIN> 7.77
<PER-SHARE-NII> .37
<PER-SHARE-GAIN-APPREC> .13
<PER-SHARE-DIVIDEND> (.40)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.87
<EXPENSE-RATIO> 2.11
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER
INFORMATION IS COMBINED FOR ALL CLASSES. THIS SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE 1998 ANNUAL REPORT TO SHAREHOLDERS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000701638
<NAME> KEMPER PORTFOLIOS
<SERIES>
<NUMBER> 073
<NAME> KEMPER SHORT INTERMEDIATE GOVERNMENT FUND CLASS - C
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> SEP-30-1998
<INVESTMENTS-AT-COST> 172,490
<INVESTMENTS-AT-VALUE> 174,746
<RECEIVABLES> 10,955
<ASSETS-OTHER> 3,675
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 189,376
<PAYABLE-FOR-SECURITIES> 8,741
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 3,765
<TOTAL-LIABILITIES> 12,506
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 197,264
<SHARES-COMMON-STOCK> 1,150
<SHARES-COMMON-PRIOR> 409
<ACCUMULATED-NII-CURRENT> 258
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (22,908)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,256
<NET-ASSETS> 176,870
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 11,403
<OTHER-INCOME> 0
<EXPENSES-NET> (2,861)
<NET-INVESTMENT-INCOME> 8,542
<REALIZED-GAINS-CURRENT> 153
<APPREC-INCREASE-CURRENT> 2,930
<NET-CHANGE-FROM-OPS> 11,625
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (285)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 729
<NUMBER-OF-SHARES-REDEEMED> (314)
<SHARES-REINVESTED> 28
<NET-CHANGE-IN-ASSETS> 3,203
<ACCUMULATED-NII-PRIOR> 2,353
<ACCUMULATED-GAINS-PRIOR> (17,576)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 920
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,861
<AVERAGE-NET-ASSETS> 167,953
<PER-SHARE-NAV-BEGIN> 7.78
<PER-SHARE-NII> .37
<PER-SHARE-GAIN-APPREC> .16
<PER-SHARE-DIVIDEND> (.42)
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 7.89
<EXPENSE-RATIO> 1.84
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
1
VPCHI01/#246460.1 11/16/98
INVESTMENT MANAGEMENT AGREEMENT
Kemper Portfolios
222 South Riverside Plaza
Chicago, Illinois 60606
September 7, 1998
Scudder Kemper Investments, Inc.
345 Park Avenue
New York, New York 10154
Investment Management Agreement
Kemper Cash Reserves Fund
Ladies and Gentlemen:
KEMPER PORTFOLIOS (the "Trust") has been established as a
Massachusetts business trust to engage in the business of an
investment company. Pursuant to the Trust's Declaration of Trust,
as amended from time-to-time (the "Declaration"), the Board of
Trustees is authorized to issue the Trust's shares of beneficial
interest (the "Shares"), in separate series, or funds. The Board
of Trustees has authorized Kemper Cash Reserves Fund (the
"Fund"). Series may be abolished and dissolved, and additional
series established, from time to time by action of the Trustees.
The Trust, on behalf of the Fund, has selected you to act as the
investment manager of the Fund and to provide certain other
services, as more fully set forth below, and you have indicated
that you are willing to act as such investment manager and to
perform such services under the terms and conditions hereinafter
set forth. Accordingly, the Trust on behalf of the Fund agrees
with you as follows:
1. Delivery of Documents. The Trust engages in the business of
investing and reinvesting the assets of the Fund in the manner
and in accordance with the investment objectives, policies and
restrictions specified in the currently effective Prospectus (the
"Prospectus") and Statement of Additional Information (the "SAI")
relating to the Fund included in the Trust's Registration
Statement on Form N-1A, as amended from time to time, (the
"Registration Statement") filed by the Trust under the Investment
Company Act of 1940, as amended, (the "1940 Act") and the
Securities Act of 1933, as amended. Copies of the documents
referred to in the preceding sentence have been furnished to you
by the Trust. The Trust has also furnished you with copies
properly certified or authenticated of each of the following
additional documents related to the Trust and the Fund:
(a) The Declaration, as amended to date.
(b) By-Laws of the Trust as in effect on the date hereof
(the "By- Laws").
(c) Resolutions of the Trustees of the Trust and the
shareholders of the Fund selecting you as investment
manager and approving the form of this Agreement.
(d) Establishment and Designation of Series of Shares of
Beneficial Interest relating to the Fund, as
applicable.
The Trust will furnish you from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements, if any, to the foregoing, including the Prospectus,
the SAI and the Registration Statement.
2. Portfolio Management Services. As manager of the assets of
the Fund, you shall provide continuing investment management of
the assets of the Fund in accordance with the investment
objectives, policies and restrictions set forth in the Prospectus
and SAI; the applicable provisions of the 1940 Act and the
Internal Revenue Code of 1986, as amended, (the "Code") relating
to regulated investment companies and all rules and regulations
thereunder; and all other applicable federal and state laws and
regulations of which you have knowledge; subject always to
policies and instructions adopted by the Trust's Board of
Trustees. In connection therewith, you shall use reasonable
efforts to manage the Fund so that it will qualify as a regulated
investment company under Subchapter M of the Code and regulations
issued thereunder. The Fund shall have the benefit of the
investment analysis and research, the review of current economic
conditions and trends and the consideration of long-range
investment policy generally available to your investment advisory
clients. In managing the Fund in accordance with the requirements
set forth in this section 2, you shall be entitled to receive and
act upon advice of counsel to the Trust. You shall also make
available to the Trust promptly upon request all of the Fund's
investment records and ledgers as are necessary to assist the
Trust in complying with the requirements of the 1940 Act and
other applicable laws. To the extent required by law, you shall
furnish to regulatory authorities having the requisite authority
any information or reports in connection with the services
provided pursuant to this Agreement which may be requested in
order to ascertain whether the operations of the Trust are being
conducted in a manner consistent with applicable laws and
regulations.
You shall determine the securities, instruments, investments,
currencies, repurchase agreements, futures, options and other
contracts relating to investments to be purchased, sold or
entered into by the Fund and place orders with broker-dealers,
foreign currency dealers, futures commission merchants or others
pursuant to your determinations and all in accordance with Fund
policies as expressed in the Registration Statement. You shall
determine what portion of the Fund's portfolio shall be invested
in securities and other assets and what portion, if any, should
be held uninvested.
You shall furnish to the Trust's Board of Trustees periodic
reports on the investment performance of the Fund and on the
performance of your obligations pursuant to this Agreement, and
you shall supply such additional reports and information as the
Trust's officers or Board of Trustees shall reasonably request.
3. Administrative Services. In addition to the portfolio
management services specified above in section 2, you shall
furnish at your expense for the use of the Fund such office space
and facilities in the United States as the Fund may require for
its reasonable needs, and you (or one or more of your affiliates
designated by you) shall render to the Trust administrative
services on behalf of the Fund necessary for operating as an open
end investment company and not provided by persons not parties to
this Agreement including, but not limited to, preparing reports
to and meeting materials for the Trust's Board of Trustees and
reports and notices to Fund shareholders; supervising,
negotiating contractual arrangements with, to the extent
appropriate, and monitoring the performance of, accounting
agents, custodians, depositories, transfer agents and pricing
agents, accountants, attorneys, printers, underwriters, brokers
and dealers, insurers and other persons in any capacity deemed to
be necessary or desirable to Fund operations; preparing and
making filings with the Securities and Exchange Commission (the
"SEC") and other regulatory and self-regulatory organizations,
including, but not limited to, preliminary and definitive proxy
materials, post-effective amendments to the Registration
Statement, semi-annual reports on Form N-SAR and notices pursuant
to Rule 24f-2 under the 1940 Act; overseeing the tabulation of
proxies by the Fund's transfer agent; assisting in the
preparation and filing of the Fund's federal, state and local tax
returns; preparing and filing the Fund's federal excise tax
return pursuant to Section 4982 of the Code; providing assistance
with investor and public relations matters; monitoring the
valuation of portfolio securities and the calculation of net
asset value; monitoring the registration of Shares of the Fund
under applicable federal and state securities laws; maintaining
or causing to be maintained for the Fund all books, records and
reports and any other information required under the 1940 Act, to
the extent that such books, records and reports and other
information are not maintained by the Fund's custodian or other
agents of the Fund; assisting in establishing the accounting
policies of the Fund; assisting in the resolution of accounting
issues that may arise with respect to the Fund's operations and
consulting with the Fund's independent accountants, legal counsel
and the Fund's other agents as necessary in connection therewith;
establishing and monitoring the Fund's operating expense budgets;
reviewing the Fund's bills; processing the payment of bills that
have been approved by an authorized person; assisting the Fund in
determining the amount of dividends and distributions available
to be paid by the Fund to its shareholders, preparing and
arranging for the printing of dividend notices to shareholders,
and providing the transfer and dividend paying agent, the
custodian, and the accounting agent with such information as is
required for such parties to effect the payment of dividends and
distributions; and otherwise assisting the Trust as it may
reasonably request in the conduct of the Fund's business, subject
to the direction and control of the Trust's Board of Trustees.
Nothing in this Agreement shall be deemed to shift to you or to
diminish the obligations of any agent of the Fund or any other
person not a party to this Agreement which is obligated to
provide services to the Fund.
4. Allocation of Charges and Expenses. Except as otherwise
specifically provided in this section 4, you shall pay the
compensation and expenses of all Trustees, officers and executive
employees of the Trust (including the Fund's share of payroll
taxes) who are affiliated persons of you, and you shall make
available, without expense to the Fund, the services of such of
your directors, officers and employees as may duly be elected
officers of the Trust, subject to their individual consent to
serve and to any limitations imposed by law. You shall provide at
your expense the portfolio management services described in
section 2 hereof and the administrative services described in
section 3 hereof.
You shall not be required to pay any expenses of the Fund other
than those specifically allocated to you in this section 4. In
particular, but without limiting the generality of the foregoing,
you shall not be responsible, except to the extent of the
reasonable compensation of such of the Fund's Trustees and
officers as are directors, officers or employees of you whose
services may be involved, for the following expenses of the Fund:
organization expenses of the Fund (including out of-pocket
expenses, but not including your overhead or employee costs);
fees payable to you and to any other Fund advisors or
consultants; legal expenses; auditing and accounting expenses;
maintenance of books and records which are required to be
maintained by the Fund's custodian or other agents of the Trust;
telephone, telex, facsimile, postage and other communications
expenses; taxes and governmental fees; fees, dues and expenses
incurred by the Fund in connection with membership in investment
company trade organizations; fees and expenses of the Fund's
accounting agent for which the Trust is responsible pursuant to
the terms of the Fund Accounting Services Agreement, custodians,
subcustodians, transfer agents, dividend disbursing agents and
registrars; payment for portfolio pricing or valuation services
to pricing agents, accountants, bankers and other specialists, if
any; expenses of preparing share certificates and, except as
provided below in this section 4, other expenses in connection
with the issuance, offering, distribution, sale, redemption or
repurchase of securities issued by the Fund; expenses relating to
investor and public relations; expenses and fees of registering
or qualifying Shares of the Fund for sale; interest charges, bond
premiums and other insurance expense; freight, insurance and
other charges in connection with the shipment of the Fund's
portfolio securities; the compensation and all expenses
(specifically including travel expenses relating to Trust
business) of Trustees, officers and employees of the Trust who
are not affiliated persons of you; brokerage commissions or other
costs of acquiring or disposing of any portfolio securities of
the Fund; expenses of printing and distributing reports, notices
and dividends to shareholders; expenses of printing and mailing
Prospectuses and SAIs of the Fund and supplements thereto; costs
of stationery; any litigation expenses; indemnification of
Trustees and officers of the Trust; and costs of shareholders'
and other meetings.
You shall not be required to pay expenses of any activity which
is primarily intended to result in sales of Shares of the Fund if
and to the extent that (i) such expenses are required to be borne
by a principal underwriter which acts as the distributor of the
Fund's Shares pursuant to an underwriting agreement which
provides that the underwriter shall assume some or all of such
expenses, or (ii) the Trust on behalf of the Fund shall have
adopted a plan in conformity with Rule 12b-1 under the 1940 Act
providing that the Fund (or some other party) shall assume some
or all of such expenses. You shall be required to pay such of the
foregoing sales expenses as are not required to be paid by the
principal underwriter pursuant to the underwriting agreement or
are not permitted to be paid by the Fund (or some other party)
pursuant to such a plan.
5. Management Fee. For all services to be rendered, payments to
be made and costs to be assumed by you as provided in sections 2,
3, and 4 hereof, the Trust on behalf of the Fund shall pay you in
United States Dollars on the last day of each month the unpaid
balance of a fee equal to the excess of (a) 1/12 of .40 of 1
percent of the average daily net assets as defined below of the
Fund for such month; provided that, for any calendar month during
which the average of such values exceeds $250,000,000 the fee
payable for that month based on the portion of the average of
such values in excess of $250,000,000 shall be 1/12 of .38 of 1
percent of such portion; provided that, for any calendar month
during which the average of such values exceeds $1,000,000,000,
the fee payable for that month based on the portion of the
average of such values in excess of $1,000,000,000 shall be 1/12
of .35 of 1 percent of such portion; provided that, for any
calendar month during which the average of such values exceeds
$2,500,000,000, the fee payable for that month based on the
portion of the average of such values in excess of $2,500,000,000
shall be 1/12 of .32 of 1 percent of such portion; provided that,
for any calendar month during which the average of such values
exceeds $5,000,000,000, the fee payable for that month based on
the portion of the average of such values in excess of
$5,000,000,000 shall be 1/12 of .30 of 1 percent of such portion;
provided that, for any calendar month during which the average of
such values exceeds $7,500,000,000, the fee payable for that
month based on the portion of the average of such values in
excess of $7,500,000,000 shall be 1/12 of .28 of 1 percent of
such portion; provided that, for any calendar month during which
the average of such values exceeds 10,000,000,000, the fee
payable for that month based on the portion of the average of
such values in excess of $10,000,000,000 shall be 1/12 of .26 of
1 percent of such portion; and provided that, for any calendar
month during which the average of such values exceeds
12,500,000,000, the fee payable for that month based on the
portion of the average of such values in excess of
$12,500,000,000 shall be 1/12 of .25 of 1 percent of such
portion; over (b) any compensation waived by you from time to
time (as more fully described below). You shall be entitled to
receive during any month such interim payments of your fee
hereunder as you shall request, provided that no such payment
shall exceed 75 percent of the amount of your fee then accrued on
the books of the Fund and unpaid.
The "average daily net assets" of the Fund shall mean the average
of the values placed on the Fund's net assets as of 4:00 p.m.
(New York time) on each day on which the net asset value of the
Fund is determined consistent with the provisions of Rule 22c-1
under the 1940 Act or, if the Fund lawfully determines the value
of its net assets as of some other time on each business day, as
of such time. The value of the net assets of the Fund shall
always be determined pursuant to the applicable provisions of the
Declaration and the Registration Statement. If the determination
of net asset value does not take place for any particular day,
then for the purposes of this section 5, the value of the net
assets of the Fund as last determined shall be deemed to be the
value of its net assets as of 4:00 p.m. (New York time), or as of
such other time as the value of the net assets of the Fund's
portfolio may be lawfully determined on that day. If the Fund
determines the value of the net assets of its portfolio more than
once on any day, then the last such determination thereof on that
day shall be deemed to be the sole determination thereof on that
day for the purposes of this section 5.
You may waive all or a portion of your fees provided for
hereunder and such waiver shall be treated as a reduction in
purchase price of your services. You shall be contractually bound
hereunder by the terms of any publicly announced waiver of your
fee, or any limitation of the Fund's expenses, as if such waiver
or limitation were fully set forth herein.
6. Avoidance of Inconsistent Position; Services Not Exclusive.
In connection with purchases or sales of portfolio securities and
other investments for the account of the Fund, neither you nor
any of your directors, officers or employees shall act as a
principal or agent or receive any commission. You or your agent
shall arrange for the placing of all orders for the purchase and
sale of portfolio securities and other investments for the Fund's
account with brokers or dealers selected by you in accordance
with Fund policies as expressed in the Registration Statement. If
any occasion should arise in which you give any advice to clients
of yours concerning the Shares of the Fund, you shall act solely
as investment counsel for such clients and not in any way on
behalf of the Fund.
Your services to the Fund pursuant to this Agreement are not to
be deemed to be exclusive and it is understood that you may
render investment advice, management and services to others. In
acting under this Agreement, you shall be an independent
contractor and not an agent of the Trust. Whenever the Fund and
one or more other accounts or investment companies advised by you
have available funds for investment, investments suitable and
appropriate for each shall be allocated in accordance with
procedures believed by you to be equitable to each entity.
Similarly, opportunities to sell securities shall be allocated in
a manner believed by you to be equitable. The Fund recognizes
that in some cases this procedure may adversely affect the size
of the position that may be acquired or disposed of for the Fund.
7. Limitation of Liability of Manager. As an inducement to your
undertaking to render services pursuant to this Agreement, the
Trust agrees that you shall not be liable under this Agreement
for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with the matters to which this
Agreement relates, provided that nothing in this Agreement shall
be deemed to protect or purport to protect you against any
liability to the Trust, the Fund or its shareholders to which you
would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of your duties, or
by reason of your reckless disregard of your obligations and
duties hereunder.
8. Duration and Termination of This Agreement. This Agreement
shall remain in force until December 1, 1998, and continue in
force from year to year thereafter, but only so long as such
continuance is specifically approved at least annually (a) by the
vote of a majority of the Trustees who are not parties to this
Agreement or interested persons of any party to this Agreement,
cast in person at a meeting called for the purpose of voting on
such approval, and (b) by the Trustees of the Trust, or by the
vote of a majority of the outstanding voting securities of the
Fund. The aforesaid requirement that continuance of this
Agreement be "specifically approved at least annually" shall be
construed in a manner consistent with the 1940 Act and the rules
and regulations thereunder and any applicable SEC exemptive order
therefrom.
This Agreement may be terminated with respect to the Fund at any
time, without the payment of any penalty, by the vote of a
majority of the outstanding voting securities of the Fund or by
the Trust's Board of Trustees on 60 days' written notice to you,
or by you on 60 days' written notice to the Trust. This Agreement
shall terminate automatically in the event of its assignment.
This Agreement may be terminated with respect to the Fund at any
time without the payment of any penalty by the Board of Trustees
or by vote of a majority of the outstanding voting securities of
the Fund in the event that it shall have been established by a
court of competent jurisdiction that you or any of your officers
or directors has taken any action which results in a breach of
your covenants set forth herein.
9. Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only
by an instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge or termination is
sought, and no amendment of this Agreement shall be effective
until approved in a manner consistent with the 1940 Act and rules
and regulations thereunder and any applicable SEC exemptive order
therefrom.
10. Limitation of Liability for Claims. The Declaration, a copy
of which, together with all amendments thereto, is on file in the
Office of the Secretary of the Commonwealth of Massachusetts,
provides that the name "Kemper Portfolios" refers to the Trustees
under the Declaration collectively as Trustees and not as
individuals or personally, and that no shareholder of the Fund,
or Trustee, officer, employee or agent of the Trust, shall be
subject to claims against or obligations of the Trust or of the
Fund to any extent whatsoever, but that the Trust estate only
shall be liable.
You are hereby expressly put on notice of the limitation of
liability as set forth in the Declaration and you agree that the
obligations assumed by the Trust on behalf of the Fund pursuant
to this Agreement shall be limited in all cases to the Fund and
its assets, and you shall not seek satisfaction of any such
obligation from the shareholders or any shareholder of the Fund
or any other series of the Trust, or from any Trustee, officer,
employee or agent of the Trust. You understand that the rights
and obligations of each Fund, or series, under the Declaration
are separate and distinct from those of any and all other series.
11. Miscellaneous. The captions in this Agreement are included
for convenience of reference only and in no way define or limit
any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute
one and the same instrument.
In interpreting the provisions of this Agreement, the definitions
contained in Section 2(a) of the 1940 Act (particularly the
definitions of "affiliated person," "assignment" and "majority of
the outstanding voting securities"), as from time to time
amended, shall be applied, subject, however, to such exemptions
as may be granted by the SEC by any rule, regulation or order.
This Agreement shall be construed in accordance with the laws of
the Commonwealth of Massachusetts, provided that nothing herein
shall be construed in a manner inconsistent with the 1940 Act, or
in a manner which would cause the Fund to fail to comply with the
requirements of Subchapter M of the Code.
This Agreement shall supersede all prior investment advisory or
management agreements entered into between you and the Trust on
behalf of the Fund.
If you are in agreement with the foregoing, please execute the
form of acceptance on the accompanying counterpart of this letter
and return such counterpart to the Trust, whereupon this letter
shall become a binding contract effective as of the date of this
Agreement.
Yours very truly,
KEMPER PORTFOLIOS, on behalf
of
Kemper Cash Reserves Fund
By:
President
The foregoing Agreement is hereby accepted as of the date hereof.
SCUDDER KEMPER INVESTMENTS,
INC.
By:
Treasurer
1
VPCHI01/#246447.1 11/17/98
INVESTMENT MANAGEMENT AGREEMENT
Kemper Portfolios
222 South Riverside Plaza
Chicago, Illinois 60606
September 7, 1998
Scudder Kemper Investments, Inc.
345 Park Avenue
New York, New York 10154
Investment Management Agreement
Kemper Short-Intermediate Government Fund
Ladies and Gentlemen:
KEMPER PORTFOLIOS (the "Trust") has been established as a
Massachusetts business trust to engage in the business of an
investment company. Pursuant to the Trust's Declaration of Trust,
as amended from time-to-time (the "Declaration"), the Board of
Trustees is authorized to issue the Trust's shares of beneficial
interest (the "Shares"), in separate series, or funds. The Board
of Trustees has authorized Kemper Short-Intermediate Government
Fund (the "Fund"). Series may be abolished and dissolved, and
additional series established, from time to time by action of the
Trustees.
The Trust, on behalf of the Fund, has selected you to act as the
investment manager of the Fund and to provide certain other
services, as more fully set forth below, and you have indicated
that you are willing to act as such investment manager and to
perform such services under the terms and conditions hereinafter
set forth. Accordingly, the Trust on behalf of the Fund agrees
with you as follows:
1. Delivery of Documents. The Trust engages in the business of
investing and reinvesting the assets of the Fund in the manner
and in accordance with the investment objectives, policies and
restrictions specified in the currently effective Prospectus (the
"Prospectus") and Statement of Additional Information (the "SAI")
relating to the Fund included in the Trust's Registration
Statement on Form N-1A, as amended from time to time, (the
"Registration Statement") filed by the Trust under the Investment
Company Act of 1940, as amended, (the "1940 Act") and the
Securities Act of 1933, as amended. Copies of the documents
referred to in the preceding sentence have been furnished to you
by the Trust. The Trust has also furnished you with copies
properly certified or authenticated of each of the following
additional documents related to the Trust and the Fund:
(a) The Declaration, as amended to date.
(b) By-Laws of the Trust as in effect on the date hereof
(the "By- Laws").
(c) Resolutions of the Trustees of the Trust and the
shareholders of the Fund selecting you as investment
manager and approving the form of this Agreement.
(d) Establishment and Designation of Series of Shares of
Beneficial Interest relating to the Fund, as
applicable.
The Trust will furnish you from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements, if any, to the foregoing, including the Prospectus,
the SAI and the Registration Statement.
2. Portfolio Management Services. As manager of the assets of
the Fund, you shall provide continuing investment management of
the assets of the Fund in accordance with the investment
objectives, policies and restrictions set forth in the Prospectus
and SAI; the applicable provisions of the 1940 Act and the
Internal Revenue Code of 1986, as amended, (the "Code") relating
to regulated investment companies and all rules and regulations
thereunder; and all other applicable federal and state laws and
regulations of which you have knowledge; subject always to
policies and instructions adopted by the Trust's Board of
Trustees. In connection therewith, you shall use reasonable
efforts to manage the Fund so that it will qualify as a regulated
investment company under Subchapter M of the Code and regulations
issued thereunder. The Fund shall have the benefit of the
investment analysis and research, the review of current economic
conditions and trends and the consideration of long-range
investment policy generally available to your investment advisory
clients. In managing the Fund in accordance with the requirements
set forth in this section 2, you shall be entitled to receive and
act upon advice of counsel to the Trust. You shall also make
available to the Trust promptly upon request all of the Fund's
investment records and ledgers as are necessary to assist the
Trust in complying with the requirements of the 1940 Act and
other applicable laws. To the extent required by law, you shall
furnish to regulatory authorities having the requisite authority
any information or reports in connection with the services
provided pursuant to this Agreement which may be requested in
order to ascertain whether the operations of the Trust are being
conducted in a manner consistent with applicable laws and
regulations.
You shall determine the securities, instruments, investments,
currencies, repurchase agreements, futures, options and other
contracts relating to investments to be purchased, sold or
entered into by the Fund and place orders with broker-dealers,
foreign currency dealers, futures commission merchants or others
pursuant to your determinations and all in accordance with Fund
policies as expressed in the Registration Statement. You shall
determine what portion of the Fund's portfolio shall be invested
in securities and other assets and what portion, if any, should
be held uninvested.
You shall furnish to the Trust's Board of Trustees periodic
reports on the investment performance of the Fund and on the
performance of your obligations pursuant to this Agreement, and
you shall supply such additional reports and information as the
Trust's officers or Board of Trustees shall reasonably request.
3. Administrative Services. In addition to the portfolio
management services specified above in section 2, you shall
furnish at your expense for the use of the Fund such office space
and facilities in the United States as the Fund may require for
its reasonable needs, and you (or one or more of your affiliates
designated by you) shall render to the Trust administrative
services on behalf of the Fund necessary for operating as an open
end investment company and not provided by persons not parties to
this Agreement including, but not limited to, preparing reports
to and meeting materials for the Trust's Board of Trustees and
reports and notices to Fund shareholders; supervising,
negotiating contractual arrangements with, to the extent
appropriate, and monitoring the performance of, accounting
agents, custodians, depositories, transfer agents and pricing
agents, accountants, attorneys, printers, underwriters, brokers
and dealers, insurers and other persons in any capacity deemed to
be necessary or desirable to Fund operations; preparing and
making filings with the Securities and Exchange Commission (the
"SEC") and other regulatory and self-regulatory organizations,
including, but not limited to, preliminary and definitive proxy
materials, post-effective amendments to the Registration
Statement, semi-annual reports on Form N-SAR and notices pursuant
to Rule 24f-2 under the 1940 Act; overseeing the tabulation of
proxies by the Fund's transfer agent; assisting in the
preparation and filing of the Fund's federal, state and local tax
returns; preparing and filing the Fund's federal excise tax
return pursuant to Section 4982 of the Code; providing assistance
with investor and public relations matters; monitoring the
valuation of portfolio securities and the calculation of net
asset value; monitoring the registration of Shares of the Fund
under applicable federal and state securities laws; maintaining
or causing to be maintained for the Fund all books, records and
reports and any other information required under the 1940 Act, to
the extent that such books, records and reports and other
information are not maintained by the Fund's custodian or other
agents of the Fund; assisting in establishing the accounting
policies of the Fund; assisting in the resolution of accounting
issues that may arise with respect to the Fund's operations and
consulting with the Fund's independent accountants, legal counsel
and the Fund's other agents as necessary in connection therewith;
establishing and monitoring the Fund's operating expense budgets;
reviewing the Fund's bills; processing the payment of bills that
have been approved by an authorized person; assisting the Fund in
determining the amount of dividends and distributions available
to be paid by the Fund to its shareholders, preparing and
arranging for the printing of dividend notices to shareholders,
and providing the transfer and dividend paying agent, the
custodian, and the accounting agent with such information as is
required for such parties to effect the payment of dividends and
distributions; and otherwise assisting the Trust as it may
reasonably request in the conduct of the Fund's business, subject
to the direction and control of the Trust's Board of Trustees.
Nothing in this Agreement shall be deemed to shift to you or to
diminish the obligations of any agent of the Fund or any other
person not a party to this Agreement which is obligated to
provide services to the Fund.
4. Allocation of Charges and Expenses. Except as otherwise
specifically provided in this section 4, you shall pay the
compensation and expenses of all Trustees, officers and executive
employees of the Trust (including the Fund's share of payroll
taxes) who are affiliated persons of you, and you shall make
available, without expense to the Fund, the services of such of
your directors, officers and employees as may duly be elected
officers of the Trust, subject to their individual consent to
serve and to any limitations imposed by law. You shall provide at
your expense the portfolio management services described in
section 2 hereof and the administrative services described in
section 3 hereof.
You shall not be required to pay any expenses of the Fund other
than those specifically allocated to you in this section 4. In
particular, but without limiting the generality of the foregoing,
you shall not be responsible, except to the extent of the
reasonable compensation of such of the Fund's Trustees and
officers as are directors, officers or employees of you whose
services may be involved, for the following expenses of the Fund:
organization expenses of the Fund (including out of-pocket
expenses, but not including your overhead or employee costs);
fees payable to you and to any other Fund advisors or
consultants; legal expenses; auditing and accounting expenses;
maintenance of books and records which are required to be
maintained by the Fund's custodian or other agents of the Trust;
telephone, telex, facsimile, postage and other communications
expenses; taxes and governmental fees; fees, dues and expenses
incurred by the Fund in connection with membership in investment
company trade organizations; fees and expenses of the Fund's
accounting agent for which the Trust is responsible pursuant to
the terms of the Fund Accounting Services Agreement, custodians,
subcustodians, transfer agents, dividend disbursing agents and
registrars; payment for portfolio pricing or valuation services
to pricing agents, accountants, bankers and other specialists, if
any; expenses of preparing share certificates and, except as
provided below in this section 4, other expenses in connection
with the issuance, offering, distribution, sale, redemption or
repurchase of securities issued by the Fund; expenses relating to
investor and public relations; expenses and fees of registering
or qualifying Shares of the Fund for sale; interest charges, bond
premiums and other insurance expense; freight, insurance and
other charges in connection with the shipment of the Fund's
portfolio securities; the compensation and all expenses
(specifically including travel expenses relating to Trust
business) of Trustees, officers and employees of the Trust who
are not affiliated persons of you; brokerage commissions or other
costs of acquiring or disposing of any portfolio securities of
the Fund; expenses of printing and distributing reports, notices
and dividends to shareholders; expenses of printing and mailing
Prospectuses and SAIs of the Fund and supplements thereto; costs
of stationery; any litigation expenses; indemnification of
Trustees and officers of the Trust; and costs of shareholders'
and other meetings.
You shall not be required to pay expenses of any activity which
is primarily intended to result in sales of Shares of the Fund if
and to the extent that (i) such expenses are required to be borne
by a principal underwriter which acts as the distributor of the
Fund's Shares pursuant to an underwriting agreement which
provides that the underwriter shall assume some or all of such
expenses, or (ii) the Trust on behalf of the Fund shall have
adopted a plan in conformity with Rule 12b-1 under the 1940 Act
providing that the Fund (or some other party) shall assume some
or all of such expenses. You shall be required to pay such of the
foregoing sales expenses as are not required to be paid by the
principal underwriter pursuant to the underwriting agreement or
are not permitted to be paid by the Fund (or some other party)
pursuant to such a plan.
5. Management Fee. For all services to be rendered, payments to
be made and costs to be assumed by you as provided in sections 2,
3, and 4 hereof, the Trust on behalf of the Fund shall pay you in
United States Dollars on the last day of each month the unpaid
balance of a fee equal to the excess of (a) 1/12 of .55 of 1
percent of the average daily net assets as defined below of the
Fund for such month; provided that, for any calendar month during
which the average of such values exceeds $250,000,000 the fee
payable for that month based on the portion of the average of
such values in excess of $250,000,000 shall be 1/12 of .52 of 1
percent of such portion; provided that, for any calendar month
during which the average of such values exceeds $1,000,000,000,
the fee payable for that month based on the portion of the
average of such values in excess of $1,000,000,000 shall be 1/12
of .50 of 1 percent of such portion; provided that, for any
calendar month during which the average of such values exceeds
$2,500,000,000, the fee payable for that month based on the
portion of the average of such values in excess of $2,500,000,000
shall be 1/12 of .48 of 1 percent of such portion; provided that,
for any calendar month during which the average of such values
exceeds $5,000,000,000, the fee payable for that month based on
the portion of the average of such values in excess of
$5,000,000,000 shall be 1/12 of .45 of 1 percent of such portion;
provided that, for any calendar month during which the average of
such values exceeds $7,500,000,000, the fee payable for that
month based on the portion of the average of such values in
excess of $7,500,000,000 shall be 1/12 of .43 of 1 percent of
such portion; provided that, for any calendar month during which
the average of such values exceeds 10,000,000,000, the fee
payable for that month based on the portion of the average of
such values in excess of $10,000,000,000 shall be 1/12 of .41 of
1 percent of such portion; and provided that, for any calendar
month during which the average of such values exceeds
12,500,000,000, the fee payable for that month based on the
portion of the average of such values in excess of
$12,500,000,000 shall be 1/12 of .40 of 1 percent of such
portion; over (b) any compensation waived by you from time to
time (as more fully described below). You shall be entitled to
receive during any month such interim payments of your fee
hereunder as you shall request, provided that no such payment
shall exceed 75 percent of the amount of your fee then accrued on
the books of the Fund and unpaid.
The "average daily net assets" of the Fund shall mean the average
of the values placed on the Fund's net assets as of 4:00 p.m.
(New York time) on each day on which the net asset value of the
Fund is determined consistent with the provisions of Rule 22c-1
under the 1940 Act or, if the Fund lawfully determines the value
of its net assets as of some other time on each business day, as
of such time. The value of the net assets of the Fund shall
always be determined pursuant to the applicable provisions of the
Declaration and the Registration Statement. If the determination
of net asset value does not take place for any particular day,
then for the purposes of this section 5, the value of the net
assets of the Fund as last determined shall be deemed to be the
value of its net assets as of 4:00 p.m. (New York time), or as of
such other time as the value of the net assets of the Fund's
portfolio may be lawfully determined on that day. If the Fund
determines the value of the net assets of its portfolio more than
once on any day, then the last such determination thereof on that
day shall be deemed to be the sole determination thereof on that
day for the purposes of this section 5.
You may waive all or a portion of your fees provided for
hereunder and such waiver shall be treated as a reduction in
purchase price of your services. You shall be contractually bound
hereunder by the terms of any publicly announced waiver of your
fee, or any limitation of the Fund's expenses, as if such waiver
or limitation were fully set forth herein.
6. Avoidance of Inconsistent Position; Services Not Exclusive.
In connection with purchases or sales of portfolio securities and
other investments for the account of the Fund, neither you nor
any of your directors, officers or employees shall act as a
principal or agent or receive any commission. You or your agent
shall arrange for the placing of all orders for the purchase and
sale of portfolio securities and other investments for the Fund's
account with brokers or dealers selected by you in accordance
with Fund policies as expressed in the Registration Statement. If
any occasion should arise in which you give any advice to clients
of yours concerning the Shares of the Fund, you shall act solely
as investment counsel for such clients and not in any way on
behalf of the Fund.
Your services to the Fund pursuant to this Agreement are not to
be deemed to be exclusive and it is understood that you may
render investment advice, management and services to others. In
acting under this Agreement, you shall be an independent
contractor and not an agent of the Trust. Whenever the Fund and
one or more other accounts or investment companies advised by you
have available funds for investment, investments suitable and
appropriate for each shall be allocated in accordance with
procedures believed by you to be equitable to each entity.
Similarly, opportunities to sell securities shall be allocated in
a manner believed by you to be equitable. The Fund recognizes
that in some cases this procedure may adversely affect the size
of the position that may be acquired or disposed of for the Fund.
7. Limitation of Liability of Manager. As an inducement to your
undertaking to render services pursuant to this Agreement, the
Trust agrees that you shall not be liable under this Agreement
for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with the matters to which this
Agreement relates, provided that nothing in this Agreement shall
be deemed to protect or purport to protect you against any
liability to the Trust, the Fund or its shareholders to which you
would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of your duties, or
by reason of your reckless disregard of your obligations and
duties hereunder.
8. Duration and Termination of This Agreement. This Agreement
shall remain in force until March 1, 1998, and continue in force
from year to year thereafter, but only so long as such
continuance is specifically approved at least annually (a) by the
vote of a majority of the Trustees who are not parties to this
Agreement or interested persons of any party to this Agreement,
cast in person at a meeting called for the purpose of voting on
such approval, and (b) by the Trustees of the Trust, or by the
vote of a majority of the outstanding voting securities of the
Fund. The aforesaid requirement that continuance of this
Agreement be "specifically approved at least annually" shall be
construed in a manner consistent with the 1940 Act and the rules
and regulations thereunder and any applicable SEC exemptive order
therefrom.
This Agreement may be terminated with respect to the Fund at any
time, without the payment of any penalty, by the vote of a
majority of the outstanding voting securities of the Fund or by
the Trust's Board of Trustees on 60 days' written notice to you,
or by you on 60 days' written notice to the Trust. This Agreement
shall terminate automatically in the event of its assignment.
This Agreement may be terminated with respect to the Fund at any
time without the payment of any penalty by the Board of Trustees
or by vote of a majority of the outstanding voting securities of
the Fund in the event that it shall have been established by a
court of competent jurisdiction that you or any of your officers
or directors has taken any action which results in a breach of
your covenants set forth herein.
9. Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only
by an instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge or termination is
sought, and no amendment of this Agreement shall be effective
until approved in a manner consistent with the 1940 Act and rules
and regulations thereunder and any applicable SEC exemptive order
therefrom.
10. Limitation of Liability for Claims. The Declaration, a copy
of which, together with all amendments thereto, is on file in the
Office of the Secretary of the Commonwealth of Massachusetts,
provides that the name "Kemper Portfolios" refers to the Trustees
under the Declaration collectively as Trustees and not as
individuals or personally, and that no shareholder of the Fund,
or Trustee, officer, employee or agent of the Trust, shall be
subject to claims against or obligations of the Trust or of the
Fund to any extent whatsoever, but that the Trust estate only
shall be liable.
You are hereby expressly put on notice of the limitation of
liability as set forth in the Declaration and you agree that the
obligations assumed by the Trust on behalf of the Fund pursuant
to this Agreement shall be limited in all cases to the Fund and
its assets, and you shall not seek satisfaction of any such
obligation from the shareholders or any shareholder of the Fund
or any other series of the Trust, or from any Trustee, officer,
employee or agent of the Trust. You understand that the rights
and obligations of each Fund, or series, under the Declaration
are separate and distinct from those of any and all other series.
11. Miscellaneous. The captions in this Agreement are included
for convenience of reference only and in no way define or limit
any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute
one and the same instrument.
In interpreting the provisions of this Agreement, the definitions
contained in Section 2(a) of the 1940 Act (particularly the
definitions of "affiliated person," "assignment" and "majority of
the outstanding voting securities"), as from time to time
amended, shall be applied, subject, however, to such exemptions
as may be granted by the SEC by any rule, regulation or order.
This Agreement shall be construed in accordance with the laws of
the Commonwealth of Massachusetts, provided that nothing herein
shall be construed in a manner inconsistent with the 1940 Act, or
in a manner which would cause the Fund to fail to comply with the
requirements of Subchapter M of the Code.
This Agreement shall supersede all prior investment advisory or
management agreements entered into between you and the Trust on
behalf of the Fund.
If you are in agreement with the foregoing, please execute the
form of acceptance on the accompanying counterpart of this letter
and return such counterpart to the Trust, whereupon this letter
shall become a binding contract effective as of the date of this
Agreement.
Yours very truly,
KEMPER PORTFOLIOS, on behalf
of
Kemper Short-Intermediate
Government Fund
By:
President
The foregoing Agreement is hereby accepted as of the date hereof.
SCUDDER KEMPER INVESTMENTS,
INC.
By:
Treasurer
Yours very truly,
KEMPER PORTFOLIOS, on behalf
of
Kemper Short-Intermediate
Government Fund
By:
President
The foregoing Agreement is hereby accepted as of the date hereof.
SCUDDER KEMPER INVESTMENTS,
INC.
By:
Treasurer
1
VPCHI01/#246455.1 11/16/98
INVESTMENT MANAGEMENT AGREEMENT
Kemper Portfolios
222 South Riverside Plaza
Chicago, Illinois 60606
September 7, 1998
Scudder Kemper Investments, Inc.
345 Park Avenue
New York, New York 10154
Investment Management Agreement
Kemper U.S. Mortgage Fund
Ladies and Gentlemen:
KEMPER PORTFOLIOS (the "Trust") has been established as a
Massachusetts business trust to engage in the business of an
investment company. Pursuant to the Trust's Declaration of Trust,
as amended from time-to-time (the "Declaration"), the Board of
Trustees is authorized to issue the Trust's shares of beneficial
interest (the "Shares"), in separate series, or funds. The Board
of Trustees has authorized Kemper U.S. Mortgage Fund (the
"Fund"). Series may be abolished and dissolved, and additional
series established, from time to time by action of the Trustees.
The Trust, on behalf of the Fund, has selected you to act as the
investment manager of the Fund and to provide certain other
services, as more fully set forth below, and you have indicated
that you are willing to act as such investment manager and to
perform such services under the terms and conditions hereinafter
set forth. Accordingly, the Trust on behalf of the Fund agrees
with you as follows:
1. Delivery of Documents. The Trust engages in the business of
investing and reinvesting the assets of the Fund in the manner
and in accordance with the investment objectives, policies and
restrictions specified in the currently effective Prospectus (the
"Prospectus") and Statement of Additional Information (the "SAI")
relating to the Fund included in the Trust's Registration
Statement on Form N-1A, as amended from time to time, (the
"Registration Statement") filed by the Trust under the Investment
Company Act of 1940, as amended, (the "1940 Act") and the
Securities Act of 1933, as amended. Copies of the documents
referred to in the preceding sentence have been furnished to you
by the Trust. The Trust has also furnished you with copies
properly certified or authenticated of each of the following
additional documents related to the Trust and the Fund:
(a) The Declaration, as amended to date.
(b) By-Laws of the Trust as in effect on the date hereof
(the "By- Laws").
(c) Resolutions of the Trustees of the Trust and the
shareholders of the Fund selecting you as investment
manager and approving the form of this Agreement.
(d) Establishment and Designation of Series of Shares of
Beneficial Interest relating to the Fund, as
applicable.
The Trust will furnish you from time to time with copies,
properly certified or authenticated, of all amendments of or
supplements, if any, to the foregoing, including the Prospectus,
the SAI and the Registration Statement.
2. Portfolio Management Services. As manager of the assets of
the Fund, you shall provide continuing investment management of
the assets of the Fund in accordance with the investment
objectives, policies and restrictions set forth in the Prospectus
and SAI; the applicable provisions of the 1940 Act and the
Internal Revenue Code of 1986, as amended, (the "Code") relating
to regulated investment companies and all rules and regulations
thereunder; and all other applicable federal and state laws and
regulations of which you have knowledge; subject always to
policies and instructions adopted by the Trust's Board of
Trustees. In connection therewith, you shall use reasonable
efforts to manage the Fund so that it will qualify as a regulated
investment company under Subchapter M of the Code and regulations
issued thereunder. The Fund shall have the benefit of the
investment analysis and research, the review of current economic
conditions and trends and the consideration of long-range
investment policy generally available to your investment advisory
clients. In managing the Fund in accordance with the requirements
set forth in this section 2, you shall be entitled to receive and
act upon advice of counsel to the Trust. You shall also make
available to the Trust promptly upon request all of the Fund's
investment records and ledgers as are necessary to assist the
Trust in complying with the requirements of the 1940 Act and
other applicable laws. To the extent required by law, you shall
furnish to regulatory authorities having the requisite authority
any information or reports in connection with the services
provided pursuant to this Agreement which may be requested in
order to ascertain whether the operations of the Trust are being
conducted in a manner consistent with applicable laws and
regulations.
You shall determine the securities, instruments, investments,
currencies, repurchase agreements, futures, options and other
contracts relating to investments to be purchased, sold or
entered into by the Fund and place orders with broker-dealers,
foreign currency dealers, futures commission merchants or others
pursuant to your determinations and all in accordance with Fund
policies as expressed in the Registration Statement. You shall
determine what portion of the Fund's portfolio shall be invested
in securities and other assets and what portion, if any, should
be held uninvested.
You shall furnish to the Trust's Board of Trustees periodic
reports on the investment performance of the Fund and on the
performance of your obligations pursuant to this Agreement, and
you shall supply such additional reports and information as the
Trust's officers or Board of Trustees shall reasonably request.
3. Administrative Services. In addition to the portfolio
management services specified above in section 2, you shall
furnish at your expense for the use of the Fund such office space
and facilities in the United States as the Fund may require for
its reasonable needs, and you (or one or more of your affiliates
designated by you) shall render to the Trust administrative
services on behalf of the Fund necessary for operating as an open
end investment company and not provided by persons not parties to
this Agreement including, but not limited to, preparing reports
to and meeting materials for the Trust's Board of Trustees and
reports and notices to Fund shareholders; supervising,
negotiating contractual arrangements with, to the extent
appropriate, and monitoring the performance of, accounting
agents, custodians, depositories, transfer agents and pricing
agents, accountants, attorneys, printers, underwriters, brokers
and dealers, insurers and other persons in any capacity deemed to
be necessary or desirable to Fund operations; preparing and
making filings with the Securities and Exchange Commission (the
"SEC") and other regulatory and self-regulatory organizations,
including, but not limited to, preliminary and definitive proxy
materials, post-effective amendments to the Registration
Statement, semi-annual reports on Form N-SAR and notices pursuant
to Rule 24f-2 under the 1940 Act; overseeing the tabulation of
proxies by the Fund's transfer agent; assisting in the
preparation and filing of the Fund's federal, state and local tax
returns; preparing and filing the Fund's federal excise tax
return pursuant to Section 4982 of the Code; providing assistance
with investor and public relations matters; monitoring the
valuation of portfolio securities and the calculation of net
asset value; monitoring the registration of Shares of the Fund
under applicable federal and state securities laws; maintaining
or causing to be maintained for the Fund all books, records and
reports and any other information required under the 1940 Act, to
the extent that such books, records and reports and other
information are not maintained by the Fund's custodian or other
agents of the Fund; assisting in establishing the accounting
policies of the Fund; assisting in the resolution of accounting
issues that may arise with respect to the Fund's operations and
consulting with the Fund's independent accountants, legal counsel
and the Fund's other agents as necessary in connection therewith;
establishing and monitoring the Fund's operating expense budgets;
reviewing the Fund's bills; processing the payment of bills that
have been approved by an authorized person; assisting the Fund in
determining the amount of dividends and distributions available
to be paid by the Fund to its shareholders, preparing and
arranging for the printing of dividend notices to shareholders,
and providing the transfer and dividend paying agent, the
custodian, and the accounting agent with such information as is
required for such parties to effect the payment of dividends and
distributions; and otherwise assisting the Trust as it may
reasonably request in the conduct of the Fund's business, subject
to the direction and control of the Trust's Board of Trustees.
Nothing in this Agreement shall be deemed to shift to you or to
diminish the obligations of any agent of the Fund or any other
person not a party to this Agreement which is obligated to
provide services to the Fund.
4. Allocation of Charges and Expenses. Except as otherwise
specifically provided in this section 4, you shall pay the
compensation and expenses of all Trustees, officers and executive
employees of the Trust (including the Fund's share of payroll
taxes) who are affiliated persons of you, and you shall make
available, without expense to the Fund, the services of such of
your directors, officers and employees as may duly be elected
officers of the Trust, subject to their individual consent to
serve and to any limitations imposed by law. You shall provide at
your expense the portfolio management services described in
section 2 hereof and the administrative services described in
section 3 hereof.
You shall not be required to pay any expenses of the Fund other
than those specifically allocated to you in this section 4. In
particular, but without limiting the generality of the foregoing,
you shall not be responsible, except to the extent of the
reasonable compensation of such of the Fund's Trustees and
officers as are directors, officers or employees of you whose
services may be involved, for the following expenses of the Fund:
organization expenses of the Fund (including out of-pocket
expenses, but not including your overhead or employee costs);
fees payable to you and to any other Fund advisors or
consultants; legal expenses; auditing and accounting expenses;
maintenance of books and records which are required to be
maintained by the Fund's custodian or other agents of the Trust;
telephone, telex, facsimile, postage and other communications
expenses; taxes and governmental fees; fees, dues and expenses
incurred by the Fund in connection with membership in investment
company trade organizations; fees and expenses of the Fund's
accounting agent for which the Trust is responsible pursuant to
the terms of the Fund Accounting Services Agreement, custodians,
subcustodians, transfer agents, dividend disbursing agents and
registrars; payment for portfolio pricing or valuation services
to pricing agents, accountants, bankers and other specialists, if
any; expenses of preparing share certificates and, except as
provided below in this section 4, other expenses in connection
with the issuance, offering, distribution, sale, redemption or
repurchase of securities issued by the Fund; expenses relating to
investor and public relations; expenses and fees of registering
or qualifying Shares of the Fund for sale; interest charges, bond
premiums and other insurance expense; freight, insurance and
other charges in connection with the shipment of the Fund's
portfolio securities; the compensation and all expenses
(specifically including travel expenses relating to Trust
business) of Trustees, officers and employees of the Trust who
are not affiliated persons of you; brokerage commissions or other
costs of acquiring or disposing of any portfolio securities of
the Fund; expenses of printing and distributing reports, notices
and dividends to shareholders; expenses of printing and mailing
Prospectuses and SAIs of the Fund and supplements thereto; costs
of stationery; any litigation expenses; indemnification of
Trustees and officers of the Trust; and costs of shareholders'
and other meetings.
You shall not be required to pay expenses of any activity which
is primarily intended to result in sales of Shares of the Fund if
and to the extent that (i) such expenses are required to be borne
by a principal underwriter which acts as the distributor of the
Fund's Shares pursuant to an underwriting agreement which
provides that the underwriter shall assume some or all of such
expenses, or (ii) the Trust on behalf of the Fund shall have
adopted a plan in conformity with Rule 12b-1 under the 1940 Act
providing that the Fund (or some other party) shall assume some
or all of such expenses. You shall be required to pay such of the
foregoing sales expenses as are not required to be paid by the
principal underwriter pursuant to the underwriting agreement or
are not permitted to be paid by the Fund (or some other party)
pursuant to such a plan.
5. Management Fee. For all services to be rendered, payments to
be made and costs to be assumed by you as provided in sections 2,
3, and 4 hereof, the Trust on behalf of the Fund shall pay you in
United States Dollars on the last day of each month the unpaid
balance of a fee equal to the excess of (a) 1/12 of .55 of 1
percent of the average daily net assets as defined below of the
Fund for such month; provided that, for any calendar month during
which the average of such values exceeds $250,000,000 the fee
payable for that month based on the portion of the average of
such values in excess of $250,000,000 shall be 1/12 of .52 of 1
percent of such portion; provided that, for any calendar month
during which the average of such values exceeds $1,000,000,000,
the fee payable for that month based on the portion of the
average of such values in excess of $1,000,000,000 shall be 1/12
of .50 of 1 percent of such portion; provided that, for any
calendar month during which the average of such values exceeds
$2,500,000,000, the fee payable for that month based on the
portion of the average of such values in excess of $2,500,000,000
shall be 1/12 of .48 of 1 percent of such portion; provided that,
for any calendar month during which the average of such values
exceeds $5,000,000,000, the fee payable for that month based on
the portion of the average of such values in excess of
$5,000,000,000 shall be 1/12 of .45 of 1 percent of such portion;
provided that, for any calendar month during which the average of
such values exceeds $7,500,000,000, the fee payable for that
month based on the portion of the average of such values in
excess of $7,500,000,000 shall be 1/12 of .43 of 1 percent of
such portion; provided that, for any calendar month during which
the average of such values exceeds 10,000,000,000, the fee
payable for that month based on the portion of the average of
such values in excess of $10,000,000,000 shall be 1/12 of .41 of
1 percent of such portion; and provided that, for any calendar
month during which the average of such values exceeds
12,500,000,000, the fee payable for that month based on the
portion of the average of such values in excess of
$12,500,000,000 shall be 1/12 of .40 of 1 percent of such
portion; over (b) any compensation waived by you from time to
time (as more fully described below). You shall be entitled to
receive during any month such interim payments of your fee
hereunder as you shall request, provided that no such payment
shall exceed 75 percent of the amount of your fee then accrued on
the books of the Fund and unpaid.
The "average daily net assets" of the Fund shall mean the average
of the values placed on the Fund's net assets as of 4:00 p.m.
(New York time) on each day on which the net asset value of the
Fund is determined consistent with the provisions of Rule 22c-1
under the 1940 Act or, if the Fund lawfully determines the value
of its net assets as of some other time on each business day, as
of such time. The value of the net assets of the Fund shall
always be determined pursuant to the applicable provisions of the
Declaration and the Registration Statement. If the determination
of net asset value does not take place for any particular day,
then for the purposes of this section 5, the value of the net
assets of the Fund as last determined shall be deemed to be the
value of its net assets as of 4:00 p.m. (New York time), or as of
such other time as the value of the net assets of the Fund's
portfolio may be lawfully determined on that day. If the Fund
determines the value of the net assets of its portfolio more than
once on any day, then the last such determination thereof on that
day shall be deemed to be the sole determination thereof on that
day for the purposes of this section 5.
You may waive all or a portion of your fees provided for
hereunder and such waiver shall be treated as a reduction in
purchase price of your services. You shall be contractually bound
hereunder by the terms of any publicly announced waiver of your
fee, or any limitation of the Fund's expenses, as if such waiver
or limitation were fully set forth herein.
6. Avoidance of Inconsistent Position; Services Not Exclusive.
In connection with purchases or sales of portfolio securities and
other investments for the account of the Fund, neither you nor
any of your directors, officers or employees shall act as a
principal or agent or receive any commission. You or your agent
shall arrange for the placing of all orders for the purchase and
sale of portfolio securities and other investments for the Fund's
account with brokers or dealers selected by you in accordance
with Fund policies as expressed in the Registration Statement. If
any occasion should arise in which you give any advice to clients
of yours concerning the Shares of the Fund, you shall act solely
as investment counsel for such clients and not in any way on
behalf of the Fund.
Your services to the Fund pursuant to this Agreement are not to
be deemed to be exclusive and it is understood that you may
render investment advice, management and services to others. In
acting under this Agreement, you shall be an independent
contractor and not an agent of the Trust. Whenever the Fund and
one or more other accounts or investment companies advised by you
have available funds for investment, investments suitable and
appropriate for each shall be allocated in accordance with
procedures believed by you to be equitable to each entity.
Similarly, opportunities to sell securities shall be allocated in
a manner believed by you to be equitable. The Fund recognizes
that in some cases this procedure may adversely affect the size
of the position that may be acquired or disposed of for the Fund.
7. Limitation of Liability of Manager. As an inducement to your
undertaking to render services pursuant to this Agreement, the
Trust agrees that you shall not be liable under this Agreement
for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with the matters to which this
Agreement relates, provided that nothing in this Agreement shall
be deemed to protect or purport to protect you against any
liability to the Trust, the Fund or its shareholders to which you
would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of your duties, or
by reason of your reckless disregard of your obligations and
duties hereunder.
8. Duration and Termination of This Agreement. This Agreement
shall remain in force until March 1, 1998, and continue in force
from year to year thereafter, but only so long as such
continuance is specifically approved at least annually (a) by the
vote of a majority of the Trustees who are not parties to this
Agreement or interested persons of any party to this Agreement,
cast in person at a meeting called for the purpose of voting on
such approval, and (b) by the Trustees of the Trust, or by the
vote of a majority of the outstanding voting securities of the
Fund. The aforesaid requirement that continuance of this
Agreement be "specifically approved at least annually" shall be
construed in a manner consistent with the 1940 Act and the rules
and regulations thereunder and any applicable SEC exemptive order
therefrom.
This Agreement may be terminated with respect to the Fund at any
time, without the payment of any penalty, by the vote of a
majority of the outstanding voting securities of the Fund or by
the Trust's Board of Trustees on 60 days' written notice to you,
or by you on 60 days' written notice to the Trust. This Agreement
shall terminate automatically in the event of its assignment.
This Agreement may be terminated with respect to the Fund at any
time without the payment of any penalty by the Board of Trustees
or by vote of a majority of the outstanding voting securities of
the Fund in the event that it shall have been established by a
court of competent jurisdiction that you or any of your officers
or directors has taken any action which results in a breach of
your covenants set forth herein.
9. Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only
by an instrument in writing signed by the party against whom
enforcement of the change, waiver, discharge or termination is
sought, and no amendment of this Agreement shall be effective
until approved in a manner consistent with the 1940 Act and rules
and regulations thereunder and any applicable SEC exemptive order
therefrom.
10. Limitation of Liability for Claims. The Declaration, a copy
of which, together with all amendments thereto, is on file in the
Office of the Secretary of the Commonwealth of Massachusetts,
provides that the name "Kemper Portfolios" refers to the Trustees
under the Declaration collectively as Trustees and not as
individuals or personally, and that no shareholder of the Fund,
or Trustee, officer, employee or agent of the Trust, shall be
subject to claims against or obligations of the Trust or of the
Fund to any extent whatsoever, but that the Trust estate only
shall be liable.
You are hereby expressly put on notice of the limitation of
liability as set forth in the Declaration and you agree that the
obligations assumed by the Trust on behalf of the Fund pursuant
to this Agreement shall be limited in all cases to the Fund and
its assets, and you shall not seek satisfaction of any such
obligation from the shareholders or any shareholder of the Fund
or any other series of the Trust, or from any Trustee, officer,
employee or agent of the Trust. You understand that the rights
and obligations of each Fund, or series, under the Declaration
are separate and distinct from those of any and all other series.
11. Miscellaneous. The captions in this Agreement are included
for convenience of reference only and in no way define or limit
any of the provisions hereof or otherwise affect their
construction or effect. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute
one and the same instrument.
In interpreting the provisions of this Agreement, the definitions
contained in Section 2(a) of the 1940 Act (particularly the
definitions of "affiliated person," "assignment" and "majority of
the outstanding voting securities"), as from time to time
amended, shall be applied, subject, however, to such exemptions
as may be granted by the SEC by any rule, regulation or order.
This Agreement shall be construed in accordance with the laws of
the Commonwealth of Massachusetts, provided that nothing herein
shall be construed in a manner inconsistent with the 1940 Act, or
in a manner which would cause the Fund to fail to comply with the
requirements of Subchapter M of the Code.
This Agreement shall supersede all prior investment advisory or
management agreements entered into between you and the Trust on
behalf of the Fund.
If you are in agreement with the foregoing, please execute the
form of acceptance on the accompanying counterpart of this letter
and return such counterpart to the Trust, whereupon this letter
shall become a binding contract effective as of the date of this
Agreement.
Yours very truly,
KEMPER PORTFOLIOS, on behalf
of
Kemper U.S. Mortgage Fund
By:
President
The foregoing Agreement is hereby accepted as of the date hereof.
SCUDDER KEMPER INVESTMENTS,
INC.
By:
Treasurer
N\\SHAREDAT\CORP_ACT\CONTRACT\KEMPER\KP\UNDER81
UNDERWRITING AND DISTRIBUTION SERVICES AGREEMENT
AGREEMENT made this 1st day of August, 1998 between KEMPER
PORTFOLIOS, a Massachusetts business trust (the "Fund"), and
KEMPER DISTRIBUTORS, INC., a Delaware corporation ("KDI").
In consideration of the mutual covenants hereinafter
contained, it is hereby agreed by and between the parties hereto
as follows:
1. The Fund hereby appoints KDI to act as agent for
distribution of shares of beneficial interest (hereinafter called
"shares") of the Fund in jurisdictions wherein shares of the Fund
may legally be offered for sale; provided, however, that the Fund
in its absolute discretion may (a) issue or sell shares directly
to holders of shares of the Fund upon such terms and conditions
and for such consideration, if any, as it may determine, whether
in connection with the distribution of subscription or purchase
rights, the payment or reinvestment of dividends or
distributions, or otherwise; or (b) issue or sell shares at net
asset value to the shareholders of any other investment company,
for which KDI shall act as exclusive distributor, who wish to
exchange all or a portion of their investment in shares of such
other investment company for shares of the Fund. KDI shall
appoint various financial service firms ("Firms") to provide
distribution services to investors. The Firms shall provide such
office space and equipment, telephone facilities, personnel,
literature distribution, advertising and promotion as is
necessary or beneficial for providing information and
distribution services to existing and potential clients of the
Firms. KDI may also provide some of the above services for the
Fund.
KDI accepts such appointment as distributor and principal
underwriter and agrees to render such services and to assume the
obligations herein set forth for the compensation herein
provided. KDI shall for all purposes herein provided be deemed
to be an independent contractor and, unless expressly provided
herein or otherwise authorized, shall have no authority to act
for or represent the Fund in any way. KDI, by separate agreement
with the Fund, may also serve the Fund in other capacities. The
services of KDI to the Fund under this Agreement are not to be
deemed exclusive, and KDI shall be free to render similar
services or other services to others so long as its services
hereunder are not impaired thereby.
In carrying out its duties and responsibilities hereunder,
KDI will, pursuant to separate written contracts, appoint various
Firms to provide advertising, promotion and other distribution
services contemplated hereunder directly to or for the benefit of
existing and potential shareholders who may be clients of such
Firms. Such Firms shall at all times be deemed to be independent
contractors retained by KDI and not the Fund.
KDI shall use its best efforts with reasonable promptness to
sell such part of the authorized shares of the Fund remaining
unissued as from time to time shall be effectively registered
under the Securities Act of 1933 ("Securities Act"), at prices
determined as hereinafter provided and on terms hereinafter set
forth, all subject to applicable federal and state laws and
regulations and to the Fund's organizational documents.
2. KDI shall sell shares of the Fund to or through
qualified Firms in such manner, not inconsistent with the
provisions hereof and the then effective registration statement
(and related prospectus) of the Fund under the Securities Act, as
KDI may determine from time to time, provided that no Firm or
other person shall be appointed or authorized to act as agent of
the Fund without prior consent of the Fund. In addition to sales
made by it as agent of the Fund, KDI may, in its discretion, also
sell shares of the Fund as principal to persons with whom it does
not have selling group agreements.
Shares of any class of any series of the Fund offered for
sale or sold by KDI shall be so offered or sold at a price per
share determined in accordance with the then current prospectus.
The price the Fund shall receive for all shares purchased from it
shall be the net asset value used in determining the public
offering price applicable to the sale of such shares. Any excess
of the sales price over the net asset value of the shares of the
Fund sold by KDI as agent shall be retained by KDI as a
commission for its services hereunder. KDI may compensate Firms
for sales of shares at the commission levels provided in the
Fund's prospectus from time to time. KDI may pay other
commissions, fees or concessions to Firms, any may pay them to
others in its discretion, in such amounts as KDI shall determine
from time to time. KDI shall be entitled to receive and retain
any applicable contingent deferred sales charge as described in
the Fund's prospectus. KDI shall also receive any distribution
services fee payable by the Fund as provided in the Fund's
Amended and Restated 12b-1 Plan, as amended from time to time
(the "Plan").
KDI will require each Firm to conform to the provisions
hereof and the Registration Statement (and related prospectus) at
the time in effect under the Securities Act with respect to the
public offering price or net asset value, as applicable, of the
Fund's shares, and neither KDI nor any such Firms shall withhold
the placing of purchase orders so as to make a profit thereby.
3. The Fund will use its best efforts to keep effectively
registered under the Securities Act for sale as herein
contemplated such shares as KDI shall reasonably request and as
the Securities and Exchange Commission shall permit to be so
registered. Notwithstanding any other provision hereof, the Fund
may terminate, suspend or withdraw the offering of shares
whenever, in its sole discretion, it deems such action to be
desirable.
4. The Fund will execute any and all documents and furnish
any and all information that may be reasonably necessary in
connection with the qualification of its shares for sale
(including the qualification of the Fund as a dealer where
necessary or advisable) in such states as KDI may reasonably
request (it being understood that the Fund shall not be required
without its consent to comply with any requirement which in its
opinion is unduly burdensome). The Fund will furnish to KDI from
time to time such information with respect to the Fund and its
shares as KDI may reasonably request for use in connection with
the sale of shares of the Fund.
5. KDI shall issue and deliver or shall arrange for
various Firms to issue and deliver on behalf of the Fund such
confirmations of sales made by it pursuant to this Agreement as
may be required. At or prior to the time of issuance of shares,
KDI will pay or cause to be paid to the Fund the amount due the
Fund for the sale of such shares. Certificates shall be issued
or shares registered on the transfer books of the Fund in such
names and denominations as KDI may specify.
6. KDI shall order shares of the Fund from the Fund only
to the extent that it shall have received purchase orders
therefor. KDI will not make, or authorize Firms or others to
make (a) any short sales of shares of the Fund; or (b) any sales
of such shares to any Board member or officer of the Fund or to
any officer or Board member of KDI or of any corporation or
association furnishing investment advisory, managerial or
supervisory services to the Fund, or to any corporation or
association, unless such sales are made in accordance with the
then current prospectus relating to the sale of such shares.
KDI, as agent of and for the account of the Fund, may repurchase
the shares of the Fund at such prices and upon such terms and
conditions as shall be specified in the current prospectus of the
Fund. In selling or reacquiring shares of the Fund for the
account of the Fund, KDI will in all respects conform to the
requirements of all state and federal laws and the Rules of Fair
Practice of the National Association of Securities Dealers, Inc.,
relating to such sale or reacquisition, as the case may be, and
will indemnify and save harmless the Fund from any damage or
expense on account of any wrongful act by KDI or any employee,
representative or agent of KDI. KDI will observe and be bound by
all the provisions of the Fund's organizational documents (and of
any fundamental policies adopted by the Fund pursuant to the
Investment Company Act of 1940 (the "Investment Company Act"),
notice of which shall have been given to KDI) which at the time
in any way require, limit, restrict, prohibit or otherwise
regulate any action on the part of KDI hereunder.
7. The Fund shall assume and pay all charges and expenses
of its operations not specifically assumed or otherwise to be
provided by KDI under this Agreement or the Plan. The Fund will
pay or cause to be paid expenses (including the fees and
disbursements of its own counsel) of any registration of the Fund
and its shares under the United States securities laws and
expenses incident to the issuance of shares of beneficial
interest, such as the cost of share certificates, issue taxes,
and fees of the transfer agent. KDI will pay all expenses (other
than expenses which one or more Firms may bear pursuant to any
agreement with KDI) incident to the sale and distribution of the
shares issued or sold hereunder, including, without limiting the
generality of the foregoing, all (a) expenses of printing and
distributing any prospectus and of preparing, printing and
distributing or disseminating any other literature, advertising
and selling aids in connection with the offering of the shares
for sale (except that such expenses need not include expenses
incurred by the Fund in connection with the preparation,
typesetting, printing and distribution of any registration
statement or prospectus, report or other communication to
shareholders in their capacity as such), (b) expenses of
advertising in connection with such offering and (c) expenses
(other than the Fund's auditing expenses) of qualifying or
continuing the qualification of the shares for sale and, in
connection therewith, of qualifying or continuing the
qualification of the Fund as a dealer or broker under the laws of
such states as may be designated by KDI under the conditions
herein specified. No transfer taxes, if any, which may be
payable in connection with the issue or delivery or shares sold
as herein contemplated or of the certificates for such shares
shall be borne by the Fund, and KDI will indemnify and hold
harmless the Fund against liability for all such transfer taxes.
8. This Agreement shall become effective on the date
hereof and shall continue until March 1, 1999; and shall continue
from year to year thereafter only so long as such continuance is
approved in the manner required by the Investment Company Act.
This Agreement shall automatically terminate in the event of
its assignment and may be terminated at any time without the
payment of any penalty by the Fund or by KDI on sixty (60) days'
written notice to the other party. The Fund may effect
termination with respect to any class of any series of the Fund
by a vote of (i) a majority of the Board members who are not
interested persons of the Fund and who have no direct or indirect
financial interest in the operation of the Plan, this Agreement,
or in any other agreement related to the Plan, or (ii) a majority
of the outstanding voting securities of such series or class.
Without prejudice to any other remedies of the Fund, the Fund may
terminate this Agreement at any time immediately upon KDI's
failure to fulfill any of its obligations hereunder.
All material amendments to this Agreement must be approved
by a vote of a majority of the Board, and of the Board members
who are not interested persons of the Fund and who have no direct
or indirect financial interest in the operation of the Plan, this
Agreement or in any other agreement related to the Plan, cast in
person at a meeting called for such purpose.
The terms "assignment," "interested person" and "vote of a
majority of the outstanding voting securities" shall have the
meanings set forth in the Investment Company Act and the rules
and regulations thereunder.
KDI shall receive such compensation for its distribution
services as set forth in the Plan. Termination of this Agreement
shall not affect the right of KDI to receive payments on any
unpaid balance of the compensation earned prior to such
termination, as set forth in the Plan.
9. KDI will not use or distribute, or authorize the use,
distribution or dissemination by Firms or others in connection
with the sale of Fund shares any statements other than those
contained in the Fund's current prospectus, except such
supplemental literature or advertising as shall be lawful under
federal and state securities laws and regulations. KDI will
furnish the Fund with copies of all such material.
10. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the
remainder shall not be thereby affected.
11. Any notice under this Agreement shall be in writing,
addressed and delivered or mailed, postage prepaid, to the other
party at such address as such other party may designate for the
receipt of such notice.
12. All parties hereto are expressly put on notice of the
Fund's Agreement and Declaration of Trust, and all amendments
thereto, all of which are on file with the Secretary of The
Commonwealth of Massachusetts, and the limitation of shareholder
and trustee liability contained therein. This Agreement has been
executed by and on behalf of the Fund by its representatives as
such representatives and not individually, and the obligations of
the Fund hereunder are not binding upon any of the Trustees,
officers or shareholders of the Fund individually but are binding
upon only the assets and property of the Fund. With respect to
any claim by KDI for recovery of any liability of the Fund
arising hereunder allocated to a particular series or class,
whether in accordance with the express terms hereof or otherwise,
KDI shall have recourse solely against the assets of that series
or class to satisfy such claim and shall have no recourse against
the assets of any other series or class for such purpose.
13. This Agreement shall be construed in accordance with
applicable federal law and with the laws of The Commonwealth of
Massachusetts.
14. This Agreement is the entire contract between the
parties relating to the subject matter hereof and supersedes all
prior agreements between the parties relating to the subject
matter hereof.
[SIGNATURES APPEAR ON NEXT PAGE]
IN WITNESS WHEREOF, the Fund and KDI have caused this
Agreement to be executed as of the day and year first above
written.
KEMPER PORTFOLIOS
By:
Title:
ATTEST:
Title:
KEMPER DISTRIBUTORS, INC.
By:
Title:
ATTEST:
Title:
REPORT OF INDEPENDENT AUDITORS
Board of Trustees
Kemper Funds
In planning and performing our audit of the financial statements of
each of the Kemper Funds listed in Exhibit A attached hereto (the
"Funds") for the period ended as of the date listed in Exhibit A
attached hereto ("Report Date"), we considered their internal
control, including control activities for safeguarding securities, in
order to determine our auditing procedures for the purpose of
expressing our opinion on the financial statements and to comply with
the requirements of Form N-SAR, not to provide assurance on internal
control.
The management of the Funds is responsible for establishing and
maintaining internal control. In fulfilling this responsibility,
estimates and judgments by management are required to assess the
expected benefits and related costs of controls. Generally, controls
that are relevant to an audit pertain to the entity's objective of
preparing financial statements for external purposes that are fairly
presented in conformity with generally accepted accounting
principles. Those controls include the safeguarding of assets
against unauthorized acquisition, use or disposition.
Because of inherent limitations in internal control, errors or fraud
may occur and not be detected. Also, projection of any evaluation of
internal control to future periods is subject to the risk that it may
become inadequate because of changes in conditions or that the
effectiveness of the design and operation may deteriorate.
Our consideration of internal control would not necessarily disclose
all matters in internal control that might be material weaknesses
under standards established by the American Institute of Certified
Public Accountants. A material weakness is a condition in which the
design or operation of one or more of specific internal control
components does not reduce to a relatively low level the risk that
errors or fraud in amounts that would be material in relation to the
financial statements being audited may occur and not be detected
within a timely period by employees in the normal course of
performing their assigned functions. However, we noted no matters
involving internal control and its operation, including controls for
safeguarding securities, that we consider to be material weaknesses
as defined above as of Report Date.
This report is intended solely for the information and use of the
board of trustees and management and the Securities and Exchange
Commission.
ERNST & YOUNG LLP
Chicago, Illinois
November 17, 1998
Kemper Funds
Exhibit A
September 30, 1998
Kemper Portfolios:
Kemper Cash Reserves Fund
Kemper U.S. Mortgage Fund
Kemper Short-Intermediate Government Fund
Kemper Growth Fund
Kemper Small Capitalization Equity Fund
Kemper Small Capitalization Relative Value Fund
Kemper Aggressive Growth Fund
Kemper U.S. Growth and Income Fund
Kemper High Yield Series:
Kemper High Yield Fund
Kemper High Yield Opportunity Fund
Kemper National State Tax-Free Income Series:
Kemper Municipal Bond Fund
Kemper Intermediate Municipal Bond Fund
Tax-Exempt California Money Market Fund
