VAN KAMPEN MERRITT SERIES TRUST
SUPPLEMENT DATED JANUARY 2, 1996
TO PROSPECTUS DATED MAY 1, 1995, AS AMENDED JUNE 1, 1995
COVA FINANCIAL SERVICES LIFE INSURANCE COMPANY
COVA VARIABLE ANNUITY ACCOUNT ONE
SUPPLEMENT DATED JANUARY 2, 1996
TO PROSPECTUS DATED MAY 1, 1995 AS AMENDED JUNE 1, 1995
A Special Meeting of the Shareholders of Van Kampen Merritt Series Trust
("Trust") is to be held on February 9, 1996. Shareholders of record as of
December 26, 1995 will be entitled to vote at that meeting on the following
changes regarding the Trust proposed by Cova Financial Services Life Insurance
Company and its insurance company affiliates ("Cova Life"):
1. The election of the following five Trustees of the Trust nominated by
Cova Life:
Stephen M. Alderman
William C. Mair
Theodore A. Myers
Deborah A. Vohasek
R. Kevin Williams
Of the nominees, Mr. Myers is the only current Trustee of the Trust. The
terms of the persons currently serving as Trustees of the Trust, with the
exception of Mr. Myers, would terminate upon the election and qualification of
the new Trustees. If reelected as a Trustee, Mr. Myers intends to continue to
serve on the Board for a one year period, after which he will resign
therefrom.
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2. The approval of a proposed New Investment Advisory Agreement between the
Trust and Cova Investment Advisory Corporation ("Cova Advisory"), a
wholly-owned subsidiary of Cova Life Management Company, a Delaware
corporation, which in turn, is a wholly-owned subsidiary of Cova Corporation.
Cova Corporation is a Missouri corporation which is a wholly-owned subsidiary
of General American Life Insurance Company, a St. Louis-based mutual company
with more than $235 billion of life insurance in force and approximately $9.6
billion in assets. Under the proposed New Investment Advisory Agreement,
which is substantially the same as the Current Investment Advisory Agreement,
Cova Advisory is obligated to provide investment advisory services to the
Trust but is permitted, at its own cost, to retain sub-adviser(s) to supervise
and implement the investment activities of the Portfolios, including
responsibility for overall portfolio management. Cova Advisory currently
intends to retain Van Kampen American Capital Investment Advisory Corp.
("VKAC"), the Trust's current investment adviser, as sub-adviser to the
Portfolios of the Trust.
THE TRUST WOULD BE OBLIGATED TO PAY THE SAME ADVISORY FEES UNDER THE
PROPOSED NEW INVESTMENT ADVISORY AGREEMENT AS IT IS OBLIGATED TO PAY UNDER THE
CURRENT INVESTMENT ADVISORY AGREEMENT.
As described further below, the advisory fees would be paid to Cova Advisory
which, in turn, will pay a portion of these fees to VKAC pursuant to the terms
of the proposed Sub-Advisory Agreement.
3. The approval of a proposed Sub-Advisory Agreement between Cova Advisory
and VKAC. Of the advisory fee which it will deduct pursuant to the proposed
New Investment Advisory Agreement, Cova Advisory will retain a portion of such
fee equal to .25 of 1% of the average daily net assets of each Portfolio. The
remaining portion of the advisory fee attributable to each Portfolio will be
paid by Cova Advisory to VKAC pursuant to the terms of the proposed
Sub-Advisory Agreement. As indicated above, there will be no increase in the
overall advisory fee paid by any of the Portfolios of the Trust.
If approved by shareholders and by the Trustees nominated for election,
Items 2 and 3 listed above would take effect on May 1, 1996.
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