KEMPER DREMAN FUND INC
497, 1996-08-13
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<PAGE>   1
 
                            KEMPER-DREMAN FUND, INC.
                            SUPPLEMENT TO PROSPECTUS
                               DATED MAY 1, 1996
                           -------------------------
                               KEMPER EUROPE FUND
                            SUPPLEMENT TO PROSPECTUS
                              DATED APRIL 19, 1996
                           -------------------------
                              KEMPER HORIZON FUND
                            SUPPLEMENT TO PROSPECTUS
                             DATED JANUARY 1, 1996
                           -------------------------
 
INVESTMENT MANAGER
 
     Kemper Financial Services, Inc., the investment manager for Kemper Horizon
Fund and Kemper Europe Fund, has changed its name to Zurich Kemper Investments,
Inc. ("ZKI"). ZKI is an indirect subsidiary of Zurich Insurance Company, an
internationally recognized company providing services in life and non-life
insurance, reinsurance and asset management. See "Investment Manager and
Underwriter" in the prospectus.
     With respect to Kemper-Dreman Fund, Inc., Christian C. Bertelsen and Steven
T. Stokes have been the portfolio co-managers of the Kemper-Dreman Small Cap
Value Fund since July, 1996. Mr. Stokes joined Dreman Value Advisors, Inc.
("DVA"), the investment manager for the Fund, in April, 1996 and is currently a
Managing Director of DVA. Prior thereto, he served as a portfolio manager of an
unaffiliated investment management firm. Mr. Stokes received a B.S. degree in
Finance from State University of New York at New Paltz. Mr. Stokes is a
Chartered Financial Analyst. Information regarding Mr. Bertelsen appears in the
prospectus under "Investment Manager and Underwriter."
 
ADMINISTRATIVE SERVICES
 
     As reflected under "Administrative Services" in the prospectus, Kemper
Distributors, Inc. ("KDI"), the principal underwriter and administrator for the
Fund, is paid an administrative service fee by the Fund of up to .25% of average
daily net assets of Class A, B and C shares of the Fund. KDI then pays financial
services firms a service fee at an annual rate of up to .25% of net assets of
each such class of those accounts in the Fund that the firms maintain and
service. In addition, KDI may, from time to time, from its own resources pay
certain firms additional amounts for ongoing administrative services and
assistance provided to their customers and clients who are shareholders of the
Fund.
 
PURCHASE OF SHARES
 
     As reflected under "Purchase of Shares--Initial Sales Charge
Alternative--Class A Shares" in the prospectus, Class A shares of the Fund may
be purchased at net asset value to the extent that the amount invested
represents the net proceeds from a redemption of shares of a mutual fund for
which ZKI or an affiliate does not serve as investment manager ("non-Kemper
fund") provided that certain conditions specified therein are satisfied
including the condition that the investor has previously paid either an initial
sales charge in connection with the purchase of the non-Kemper fund shares
redeemed or a contingent deferred sales charge in connection with the redemption
of the non-Kemper fund shares. KDI may in its discretion compensate firms for
sales of Class A shares under this privilege at a commission rate of .50% of the
amount of Class A shares of the Fund purchased.
     As described under "Purchase of Shares--Initial Sales Charge
Alternative--Class A Shares" in the prospectus, Class A shares of the Fund may
be purchased at net asset value by: (a) any purchaser provided that the amount
invested in the Fund and certain other Kemper Mutual Funds totals at least
$1,000,000, or (b) certain participant--directed employee benefit plans with at
least 200 eligible employees (the "Large Order NAV Purchase Privilege").
Redemption within one year of shares purchased under the Large Order NAV
Purchase Privilege may be subject to a contingent deferred sales charge of 1%.
Effective for shares purchased on or after June 17, 1996 under this privilege,
in addition to the aforementioned 1% contingent deferred sales charge, a
contingent deferred sales charge of .50% may be imposed upon redemption of such
<PAGE>   2
 
shares during the second year following the date of purchase. See "Redemption or
Repurchase of Shares-- Contingent Deferred Sales Charge--Large Order NAV
Purchase Privilege" in the prospectus for information on the calculation of the
charge and waivers of the charge. In addition to the waivers set forth in the
aforementioned section of the prospectus, the contingent deferred sales charge
will be waived in connection with redemptions of shares purchased under the
Large Order NAV Purchase Privilege by investors whose dealer of record at the
time of investment notifies KDI that the dealer waives the commission for such
purchase described in the following paragraph.
     In addition, as reflected under "Purchase of Shares--Initial Sales Charge
Alternative--Class A Shares" in the prospectus, KDI may in its discretion
compensate investment dealers or other financial services firms up to certain
amounts in connection with the sale of Class A shares of the Fund at net asset
value in accordance with the Large Order NAV Purchase Privilege. Effective for
shares purchased on or after June 17, 1996 under this privilege, KDI may in its
discretion compensate such firms up to the following amounts: 1.00% of the net
asset value of shares sold on amounts up to $5 million, .50% on the next $45
million and .25% on amounts over $50 million. The commission schedule will be
reset on a calendar year basis for sales of shares pursuant to the Large Order
NAV Purchase Privilege to employer sponsored employee benefit plans using the
subaccount recordkeeping system made available through Kemper Service Company.
For purposes of determining the appropriate commission percentage to be applied
to a particular sale under the foregoing schedule, KDI will consider the amount
invested by a purchaser in the Fund and other Kemper Mutual Funds listed under
"Special Features--Class A Shares--Combined Purchases" in the prospectus,
including purchases pursuant to the "Combined Purchases," "Letter of Intent" and
"Cumulative Discount" features described under "Special Features."
     Class A shares of the Fund may be purchased at net asset value in any
amount by certain professionals who assist in the promotion of Kemper Funds
pursuant to personal services contracts with KDI, for themselves or members of
their families. KDI in its discretion may compensate financial services firms
for sales of Class A shares under this privilege at a commission rate of .50% of
the amount of Class A shares purchased.
 
CLASS C SHARES
 
     As described more fully below, the "Summary of Expenses--Shareholder
Transaction Expenses" table in the prospectus applicable to Class C shares
purchased on or after April 1, 1996 is restated as follows:
 
<TABLE>
<CAPTION>
                                                                                 CLASS C
                                                                        -------------------------
<S>                                                                     <C>
Maximum Sales Charge on Purchases (as a percentage of offering
  price).............................................................             None
Maximum Sales Charge on Reinvested Dividends.........................             None
Redemption Fees......................................................             None
Exchange Fee.........................................................             None
Deferred Sales Charge (as a percentage of redemption proceeds).......   1% during the first year
</TABLE>
 
     Effective for Class C shares purchased on or after April 1, 1996, KDI
advances to financial services firms for sales of Class C shares the first year
distribution fee at a rate of .75% of the purchase price of such shares and the
first year service fee at a rate of up to .25% of the purchase price of such
shares. Distribution and service fees for periods after the first year will be
paid by KDI as currently provided. See "Investment Manager and Underwriter" in
the prospectus.
     In addition, effective for Class C shares purchased on or after April 1,
1996, a contingent deferred sales charge of 1% may be imposed upon the
redemption of Class C shares within one year of purchase. The charge will not be
imposed upon redemption of reinvested dividends or share appreciation. The
charge is
<PAGE>   3
 
applied to the value of the shares redeemed excluding amounts not subject to the
charge. The contingent deferred sales charge will be waived: (a) in the event of
the total disability (as evidenced by a determination by the federal Social
Security Administration) of the shareholder (including a registered joint owner)
occurring after the purchase of the shares being redeemed, (b) in the event of
the death of the shareholder (including a registered joint owner), (c) for
redemptions made pursuant to a systematic withdrawal plan (limited to 10% of the
net asset value of the account; see "Special Features--Systematic Withdrawal
Plan"), (d) for redemptions made pursuant to any IRA systematic withdrawal based
on the shareholder's life expectancy including, but not limited to,
substantially equal periodic payments described in Internal Revenue Code Section
72(t)(2)(A)(iv) prior to age 59 1/2, (e) for redemptions to satisfy required
minimum distributions after age 70 1/2 from an IRA account (with the maximum
amount subject to this waiver being based only upon the shareholder's Kemper IRA
accounts) and (f) for any participant-directed redemption of shares held by
employer sponsored employee benefit plans maintained on the subaccount record
keeping system made available by the Shareholder Service Agent.
     Investments are tracked on a monthly basis for purposes of the contingent
deferred sales charge. The period of ownership for this purpose begins the first
day of the month in which the order for the purchase of shares is received. A
redemption will be made first from Class C shares representing reinvested
dividends and then from the earliest purchase of Class C shares. KDI receives
any contingent deferred sales charge directly.
     Class C shares may be exchanged without any contingent deferred sales
charge being imposed at the time of exchange. For determining whether there is a
contingent deferred sales charge that may be imposed upon redemption of the
Class C shares received by exchange, they retain the cost and purchase date of
the shares that were originally purchased and exchanged.
 
DIVIDENDS AND TAXES
 
     Dividends and other distributions in the aggregate amount of $10 or less
are automatically reinvested in shares of the Fund unless the Shareholder
requests that such policy not be applied to the Shareholder's account.
     When more than one shareholder resides at the same address, certain reports
and communications to be delivered to such shareholders may be combined in the
same mailing package, and certain duplicate reports and communications may be
eliminated. Similarly, account statements to be sent to such shareholders may be
combined in the same mailing package or consolidated into a single statement.
However, a shareholder may request that the foregoing policies not be applied to
shareholder's account.
 
REDEMPTION OR REPURCHASE OF SHARES
 
     If shares of a Fund to be redeemed were purchased by check or through
EXPRESS-Transfer or Bank Direct Deposit, the Fund may delay transmittal of
redemption proceeds until it has determined that collected proceeds have been
received for the purchase of such shares, which may be up to 10 calendar days
from receipt by the Fund of the purchase amount.
 
SPECIAL FEATURES
 
  EXPRESS-TRANSFER
 
     The minimum and maximum amounts that may be redeemed under the
EXPRESS-Transfer privilege are $100 and $50,000, respectively.
 
August 9, 1996
KMF-1E  8/96 (LOGO)Kprinted on recycled paper


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