-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HEVzPnQAVctnfXG9TowJ4XxxCDj8BydkR4fYBxx/6DiL+EVjnFAe4i39AmfG6goT w8BZn04+82AHZhzM75513g== 0000823342-97-000002.txt : 19970630 0000823342-97-000002.hdr.sgml : 19970630 ACCESSION NUMBER: 0000823342-97-000002 CONFORMED SUBMISSION TYPE: NSAR-A PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19970430 FILED AS OF DATE: 19970627 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: KEMPER BLUE CHIP FUND CENTRAL INDEX KEY: 0000823342 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 363542349 STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: NSAR-A SEC ACT: 1940 Act SEC FILE NUMBER: 811-05357 FILM NUMBER: 97631542 BUSINESS ADDRESS: STREET 1: 222 SOUTH RIVERSIDE PLAZA CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3125371569 MAIL ADDRESS: STREET 1: 222 SOUTH RIVERSIDE PLAZA CITY: CHICAGO STATE: IL ZIP: 60606 NSAR-A 1 N-SAR (3.0) PAGE 1 000 A000000 04/30/97 000 C000000 0000823342 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 BLUE CHIP FUND 001 B000000 811-5357 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 N 007 B000000 0 007 C010100 1 007 C010200 2 007 C010300 3 007 C010400 4 007 C010500 5 007 C010600 6 007 C010700 7 007 C010800 8 007 C010900 9 007 C011000 10 008 A000001 ZURICH KEMPER INVESTMENTS, INC. 008 B000001 A 008 C000001 801-6634 008 D010001 CHICAGO 008 D020001 IL 008 D030001 60606 008 D040001 5808 008 A000002 ZURICH INVESTMENT MANAGEMENT LIMITED 008 B000002 S 008 C000002 801-45306 008 D010002 LONDON 008 D050002 UK 008 D060002 EC4M 7RQ 010 A000001 ZURICH KEMPER DISTRIBUTORS, INC. 010 B000001 8-47765 010 C010001 CHICAGO 010 C020001 IL 010 C030001 60606 PAGE 2 010 C040001 5808 011 A000001 ZURICH KEMPER DISTRIBUTORS, INC. 011 B000001 8-47765 011 C010001 CHICAGO 011 C020001 IL 011 C030001 60606 011 C040001 5808 012 A000001 ZURICH KEMPER SERVICE COMPANY 012 B000001 84-1713 012 C010001 KANSAS CITY 012 C020001 MO 012 C030001 64105 013 A000001 ERNST & YOUNG LLP 013 B010001 CHICAGO 013 B020001 IL 013 B030001 60606 014 A000001 ZURICH KEMPER DISTRIBUTORS, INC. 014 B000001 8-47765 014 A000002 GRUNTAL SECURITIES, INC. 014 B000002 8-31022 014 A000003 THE GMS GROUP, INC. 014 B000003 8-23936 015 A000001 INVESTORS FIDUCIARY TRUST COMPANY 015 B000001 C 015 C010001 KANSAS CITY 015 C020001 MO 015 C030001 64105 015 E010001 X 015 A000002 THE CHASE MANHATTAN BANK 015 B000002 C 015 C010002 BROOKLYN 015 C020002 NY 015 C030002 11245 015 E040002 X 015 A000003 STATE STREET BANK AND TRUST COMPANY 015 B000003 S 015 C010003 BOSTON 015 C020003 MA 015 C030003 02110 015 E010003 X 018 000000 Y 019 A000000 Y 019 B000000 58 019 C000000 KEMPERFNDS 020 A000001 SMITH BARNEY INC. 020 B000001 13-1912900 020 C000001 98 020 A000002 SALOMON BROTHERS INC. 020 B000002 13-3082694 020 C000002 86 020 A000003 MERRILL LYNCH, PIERCE, FENNER & SMITH INC. PAGE 3 020 B000003 13-5674085 020 C000003 53 020 A000004 PAINEWEBBER INCORPORATED 020 B000004 13-2638166 020 C000004 40 020 A000005 ALEX. BROWN & SONS INCORPORATED 020 B000005 52-0256630 020 C000005 27 020 A000006 DONALDSON, LUFKIN & JENRETTE SECURITIES CORP. 020 B000006 13-2741729 020 C000006 25 020 A000007 BRIDGE TRADING COMPANY 020 B000007 43-1450530 020 C000007 21 020 A000008 WERTHEIM & CO. 020 B000008 13-2697272 020 C000008 16 020 A000009 GOLDMAN, SACHS & CO. 020 B000009 13-5108880 020 C000009 16 020 A000010 BEAR, STEARNS & CO. INC. 020 B000010 13-3299429 020 C000010 15 021 000000 668 022 A000001 GOLDMAN, SACHS & CO. 022 B000001 13-5108880 022 C000001 113154 022 D000001 17198 022 A000002 LEHMAN BROTHERS INC. 022 B000002 13-2518466 022 C000002 60366 022 D000002 16333 022 A000003 MERRILL LYNCH, PIERCE, FENNER & SMITH INC. 022 B000003 13-5674085 022 C000003 45945 022 D000003 21836 022 A000004 CS FIRST BOSTON CORPORATION 022 B000004 13-5659485 022 C000004 14807 022 D000004 13071 022 A000005 DONALDSON, LUFKIN & JENRETTE SECURITIES CORP. 022 B000005 13-2741729 022 C000005 7177 022 D000005 5071 022 A000006 MORGAN STANLEY & CO. INCORPORATED 022 B000006 13-2655998 022 C000006 8139 022 D000006 3444 022 A000007 SMITH BARNEY INC. 022 B000007 13-1912900 022 C000007 4630 PAGE 4 022 D000007 6546 022 A000008 SALOMON BROTHERS INC. 022 B000008 13-3082694 022 C000008 1021 022 D000008 5126 022 A000009 BEAR, STEARNS & CO. INC. 022 B000009 13-3299429 022 C000009 3096 022 D000009 0 022 A000010 PAINEWEBBER INCORPORATED 022 B000010 13-2638166 022 C000010 2447 022 D000010 0 023 C000000 265522 023 D000000 92439 024 000000 Y 025 A000001 MERRILL LYNCH & CO. 025 B000001 13-5674085 025 C000001 E 025 D000001 2096 025 D000002 0 025 D000003 0 025 D000004 0 025 D000005 0 025 D000006 0 025 D000007 0 025 D000008 0 026 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 028 A010000 13875 028 A020000 3 028 A030000 0 028 A040000 3134 028 B010000 10128 028 B020000 48045 028 B030000 0 028 B040000 8799 028 C010000 13977 028 C020000 0 028 C030000 0 028 C040000 9488 028 D010000 19299 028 D020000 0 PAGE 5 028 D030000 0 028 D040000 4873 028 E010000 13763 028 E020000 0 028 E030000 0 028 E040000 10242 028 F010000 14454 028 F020000 1 028 F030000 0 028 F040000 9242 028 G010000 85496 028 G020000 48049 028 G030000 0 028 G040000 45778 028 H000000 20981 029 000000 Y 030 A000000 455 030 B000000 5.75 030 C000000 0.00 031 A000000 66 031 B000000 0 032 000000 386 033 000000 3 034 000000 Y 035 000000 41 036 A000000 N 036 B000000 0 037 000000 N 038 000000 0 039 000000 N 040 000000 Y 041 000000 Y 042 A000000 0 042 B000000 0 042 C000000 0 042 D000000 0 042 E000000 0 042 F000000 0 042 G000000 0 042 H000000 100 043 000000 269 044 000000 1198 045 000000 Y 046 000000 N 047 000000 Y 048 000000 0.000 048 A010000 250000 048 A020000 0.580 048 B010000 750000 048 B020000 0.550 048 C010000 1500000 PAGE 6 048 C020000 0.530 048 D010000 2500000 048 D020000 0.510 048 E010000 2500000 048 E020000 0.480 048 F010000 2500000 048 F020000 0.460 048 G010000 2500000 048 G020000 0.440 048 H010000 0 048 H020000 0.000 048 I010000 0 048 I020000 0.000 048 J010000 0 048 J020000 0.000 048 K010000 12500000 048 K020000 0.420 049 000000 N 050 000000 N 051 000000 N 052 000000 N 053 A000000 N 054 A000000 Y 054 B000000 Y 054 C000000 N 054 D000000 N 054 E000000 N 054 F000000 N 054 G000000 N 054 H000000 Y 054 I000000 N 054 J000000 Y 054 K000000 N 054 L000000 N 054 M000000 Y 054 N000000 N 054 O000000 N 055 A000000 N 055 B000000 N 056 000000 Y 057 000000 N 058 A000000 N 059 000000 Y 060 A000000 Y 060 B000000 Y 061 000000 1000 062 A000000 N 062 B000000 0.0 062 C000000 0.0 062 D000000 0.0 062 E000000 0.0 PAGE 7 062 F000000 0.0 062 G000000 0.0 062 H000000 0.0 062 I000000 0.0 062 J000000 0.0 062 K000000 0.0 062 L000000 0.0 062 M000000 0.0 062 N000000 0.0 062 O000000 0.0 062 P000000 0.0 062 Q000000 0.0 062 R000000 0.0 063 A000000 0 063 B000000 0.0 066 A000000 Y 066 B000000 N 066 C000000 N 066 D000000 N 066 E000000 Y 066 F000000 N 066 G000000 N 067 000000 N 068 A000000 N 068 B000000 N 069 000000 N 070 A010000 Y 070 A020000 Y 070 B010000 Y 070 B020000 N 070 C010000 Y 070 C020000 N 070 D010000 Y 070 D020000 N 070 E010000 Y 070 E020000 N 070 F010000 Y 070 F020000 N 070 G010000 Y 070 G020000 N 070 H010000 Y 070 H020000 N 070 I010000 N 070 I020000 N 070 J010000 Y 070 J020000 N 070 K010000 Y 070 K020000 N 070 L010000 Y 070 L020000 Y 070 M010000 Y PAGE 8 070 M020000 Y 070 N010000 Y 070 N020000 N 070 O010000 N 070 O020000 N 070 P010000 N 070 P020000 N 070 Q010000 N 070 Q020000 N 070 R010000 N 070 R020000 N 071 A000000 334827 071 B000000 296845 071 C000000 277724 071 D000000 214 072 A000000 6 072 B000000 891 072 C000000 2539 072 D000000 0 072 E000000 0 072 F000000 851 072 G000000 337 072 H000000 0 072 I000000 0 072 J000000 537 072 K000000 0 072 L000000 33 072 M000000 8 072 N000000 0 072 O000000 0 072 P000000 0 072 Q000000 0 072 R000000 20 072 S000000 4 072 T000000 269 072 U000000 0 072 V000000 0 072 W000000 1 072 X000000 2060 072 Y000000 0 072 Z000000 1370 072AA000000 31739 072BB000000 9088 072CC010000 4461 072CC020000 0 072DD010000 1439 072DD020000 182 072EE000000 48419 073 A010000 0.0000 073 A020000 0.0000 073 B000000 3.1300 PAGE 9 073 C000000 0.0000 074 A000000 314 074 B000000 0 074 C000000 27917 074 D000000 9035 074 E000000 4756 074 F000000 290403 074 G000000 0 074 H000000 0 074 I000000 0 074 J000000 4073 074 K000000 0 074 L000000 1032 074 M000000 0 074 N000000 337530 074 O000000 14495 074 P000000 253 074 Q000000 0 074 R010000 0 074 R020000 0 074 R030000 0 074 R040000 401 074 S000000 0 074 T000000 322381 074 U010000 15342 074 U020000 5413 074 V010000 0.00 074 V020000 0.00 074 W000000 0.0000 074 X000000 57497 074 Y000000 0 075 A000000 0 075 B000000 294554 076 000000 0.00 077 A000000 Y 077 B000000 N 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 PAGE 10 077 Q020000 N 077 Q030000 N 078 000000 N SIGNATURE JEROME L. DUFFY TITLE TREASURER EX-27.CLASSA 2
6 PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER INFORMATION IS COMBINED FOR ALL THE CLASSES. THIS SCHEDULE CONTAINS SUMMARY FINANACIAL INFORMATION EXTRACTED FROM THE 1997 SEMIANNUAL REPORT TO SHAREHOLDERS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000823342 KEMPER BLUE CHIP FUND 001 CLASS A 1000 6-MOS OCT-31-1997 NOV-01-1996 APR-30-1997 308,327 332,111 5,105 314 0 337,530 14,495 0 654 15,149 0 274,187 15,342 11,607 1,532 0 22,877 0 23,785 322,381 2,539 891 0 (2,060) 1,370 22,651 4,461 28,482 120 (1,439) (37,297) 0 2,953 (1,762) 2,544 66,209 1,663 48,645 0 0 851 0 2,060 294,554 17.14 0.10 1.57 (0.13) (3.13) 0 15.55 1.16 0 0

EX-27.CLASSB 3
6 PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER INFORMATION IS COMBINED FOR ALL THE CLASSES. THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 1997 SEMIANNUAL REPORT TO SHAREHOLDERS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000823342 KEMPER BLUE CHIP FUND 002 CLASS B 1000 6-MOS OCT-31-1997 NOV-01-1996 APR-30-1997 308,327 332,111 5,105 314 0 337,530 14,495 0 654 15,149 0 274,187 5,047 3,166 1,532 0 22,877 0 23,785 322,381 2,539 891 0 (2,060) 1,370 22,651 4,461 28,482 120 (169) (10,548) 0 2,274 (1,106) 713 66,209 1,663 48,645 0 0 851 0 2,060 294,554 17.09 0.02 1.56 (0.05) (3.13) 0 15.49 2.08 0 0

EX-27.CLASSC 4
6 PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER INFORMATION IS COMBINED FOR ALL THE CLASSES. THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 1997 SEMIANNUAL REPORT TO SHAREHOLDERS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000823342 KEMPER BLUE CHIP FUND 003 CLASS C 1000 6-MOS OCT-31-1997 NOV-01-1996 APR-30-1997 308,327 332,111 5,105 314 0 337,530 14,495 0 654 15,149 0 274,187 360 181 1,532 0 22,877 0 23,785 322,381 2,539 891 0 (2,060) 1,370 22,651 4,461 28,482 120 (13) (570) 0 244 (105) 40 66,209 1,663 48,645 0 0 851 0 2,060 294,554 17.15 0.01 1.59 (0.05) (3.13) 0 15.57 2.01 0 0

EX-27.CLASSI 5
6 PER SHARE AND RATIO INFORMATION IS SHOWN AT THE CLASS LEVEL. ALL OTHER INFORMATION IS COMBINED FOR ALL THE CLASSES. THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 1997 SEMIANNUAL REPORT TO SHAREHOLDERS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000823342 KEMPER BLUE CHIP FUND 004 CLASS I 1000 6-MOS OCT-31-1997 NOV-01-1996 APR-30-1997 308,327 332,111 5,105 314 0 337,530 14,495 0 654 15,149 0 274,187 6 1 1,532 0 22,877 0 23,785 322,381 2,539 891 0 (2,060) 1,370 22,651 4,461 28,482 120 0 (4) 0 5 0 0 66,209 1,663 48,645 0 0 851 0 2,060 294,554 17.18 0.07 1.57 (0.12) (3.13) 0 15.57 1.37 0 0

EX-99.Q1 6 Exhibit 77Q1(e) Kemper Blue Chip Fund Form N-SAR for the period ended 04/30/97 File No. 811-5357 SUB-ADVISORY AGREEMENT (Form 2) AGREEMENT made this 1st day of December, 1996, by and between ZURICH KEMPER INVESTMENTS, INC., a Delaware corporation (the "Adviser") and ZURICH INVESTMENT MANAGEMENT LIMITED, an English corporation (the "Sub-Adviser"). WHEREAS, KEMPER BLUE CHIP FUND, a Massachusetts business trust (the "Fund") is a management investment company registered under the Investment Company Act of 1940; WHEREAS, the Fund has retained the Adviser to render to it investment advisory and management services with regard to the Fund's sole series (the "initial series") pursuant to an Investment Management Agreement (the "Management Agreement"); and WHEREAS, the Adviser desires at this time to retain the Sub-Adviser to render investment advisory and management services with respect to that portion of the portfolio of the Fund's initial series allocated to the Sub-Adviser by the Adviser for management of foreign securities, including foreign currency transactions and related investments, and the Sub-Adviser is willing to render such services; NOW THEREFORE, in consideration of the mutual covenants hereinafter contained, it is hereby agreed by and between the parties hereto as follows: 1. The Adviser hereby employs the Sub-Adviser to manage the investment and reinvestment of the assets of the initial series of the Fund allocated by the Adviser in its sole discretion to the Sub-Adviser for management of foreign securities, including foreign currency transactions and related investments, in accordance with the applicable investment objectives, policies and limitations and subject to the supervision of the Adviser and the Board of Trustees of the Fund for the period and upon the terms herein set forth, and to place orders for the purchase or sale of portfolio securities for the Fund's account with brokers or dealers selected by the Sub-Adviser; and, in connection therewith, the Sub-Adviser is authorized as the agent of the Fund to give instructions to the Custodian of the Fund as to the deliveries of securities and payments of cash for the account of the Fund. In connection with the selection of such brokers or dealers and the placing of such orders, the Sub-Adviser is directed to seek for the Fund best execution of orders. Subject to such policies as the Board of Trustees of the Fund determines and subject to satisfying the requirements of Section 28(e) of the Securities Exchange Act of 1934, the Sub-Adviser shall not be deemed to have acted unlawfully or to have breached any duty, created by this Agreement or otherwise, solely by reason of its having caused the Fund to pay a broker or dealer an amount of commission for effecting a securities transaction in excess of the amount of commission another broker or dealer would have charged for effecting that transaction, if the Sub-Adviser determined in good faith that such amount of commission was reasonable in relation to the value of the brokerage and research services provided by such broker or dealer viewed in terms of either that particular transaction or the Sub-Adviser's overall responsibilities with respect to the clients of the Sub-Adviser as to which the Sub-Adviser exercises investment discretion. The Adviser recognizes that all research services and research that the Sub-Adviser receives are available for all clients of the Sub-Adviser, and that the Fund and other clients of the Sub-Adviser may benefit thereby. The investment of funds shall be subject to all applicable restrictions of the Agreement and Declaration of Trust and By-Laws of the Fund as may from time to time be in force. The Sub-Adviser accepts such employment and agrees during such period to render such investment management services, to furnish related office facilities and equipment and clerical, bookkeeping and administrative services for the Fund, to permit any of its officers or employees to serve without compensation as trustees or officers of the Fund if elected to such positions and to assume the obligations herein set forth for the compensation herein provided. The Sub-Adviser shall for all purposes herein provided be deemed to be an independent contractor and, unless otherwise expressly provided or authorized, shall have no authority to act for or represent the Fund or the Adviser in any way or otherwise be deemed an agent of the Fund or the Adviser. It is understood and agreed that the Sub-Adviser, by separate agreements with the Fund, may also serve the Fund in other capacities. The Sub-Adviser will keep the Fund and the Adviser informed of developments materially affecting the Fund and shall, on the Sub-Adviser's own initiative and as reasonably requested by the Adviser or the Fund, furnish to the Fund and the Adviser from time to time whatever information the Adviser reasonably believes appropriate for this purpose. The Sub-Adviser agrees that, in the performance of the duties required of it by this Agreement, it will comply with the Investment Advisers Act of 1940 and the Investment Company Act of 1940, and all rules and regulations thereunder, and all applicable laws and regulations and with any applicable procedures adopted by the Fund's Board of Trustees and identified in writing to the Sub-Adviser. -2- The Sub-Adviser shall provide the Adviser with such investment portfolio accounting and shall maintain and provide such detailed records and reports as the Adviser may from time to time reasonably request, including without limitation, daily processing of investment transactions and cash positions, periodic valuations of investment portfolio positions as required by the Adviser, monthly reports of the investment portfolio and all investment transactions and the preparation of such reports and compilation of such data as may be required by the Adviser to comply with the obligations imposed upon it under Management Agreement. The Sub-Adviser shall provide adequate security with respect to all materials, records, documents and data relating to any of its responsibilities pursuant to this Agreement including any means for the effecting of securities transactions. The Sub-Adviser agrees that it will make available to the Adviser and the Fund promptly upon their request copies of all of its investment records and ledgers with respect to the Fund to assist the Adviser and the Fund in monitoring compliance with the Investment Company Act of 1940 and the Investment Advisers Act of 1940, as well as other applicable laws. The Sub-Adviser will furnish the Fund's Board of Trustees such periodic and special reports with respect to the Fund's portfolio as the Adviser or the Board of Trustees may reasonably request. In compliance with the requirements of Rule 31a-3 under the Investment Company Act of 1940, the Sub-Adviser hereby agrees that any records that it maintains for the Fund are the property of the Fund and further agrees to surrender promptly to the Fund copies of any such records upon the Fund's request. The Sub- Adviser further agrees to preserve for the periods prescribed by Rule 31a-2 under the Investment Company Act of 1940 any records with respect to the Sub-Adviser's duties hereunder required to be maintained by Rule 31a-1 under the such Act to the extent that the Sub-Adviser prepares and maintains such records pursuant to this Agreement and to preserve the records required by Rule 204-2 under the Investment Advisers Act of 1940 for the period specified in that Rule. The Sub-Adviser agrees that it will immediately notify the Adviser and the Fund in the event that the Sub-Adviser: (i) becomes subject to a statutory disqualification that prevents the Sub-Adviser from serving as an investment adviser pursuant to this Agreement; or (ii) is or expects to become the subject of an administrative proceeding or enforcement action by the United States Securities and Exchange Commission, the Investment Management Regulatory Organization ("IMRO") or other regulatory authority. -3- The Sub-Adviser represents that it is an investment adviser registered under the Investment Advisers Act of 1940 and other applicable laws and it is regulated by IMRO and will treat the Fund as a Non-Private Customer as defined by IMRO. The Sub- Adviser agrees to maintain the completeness and accuracy of its registration on Form ADV in accordance with all legal requirements relating to that Form. The Sub-Adviser acknowledges that it is an "investment adviser" to the Fund within the meaning of the Investment Company Act of 1940 and the Investment Advisers Act of 1940. The Sub-Adviser shall be responsible maintaining an appropriate compliance program to ensure that the services provided by it under this Agreement are performed in a manner consistent with applicable laws and the terms of this Agreement. Furthermore, the Sub-Adviser shall maintain and enforce a Code of Ethics that is in form and substance satisfactory to the Adviser. Sub-Adviser agrees to provide such reports and certifications regarding its compliance program as the Adviser or the Fund shall reasonably request from time to time. 2. In the event that there are, from time to time, one or more additional series of the Fund with respect to which the Adviser desires to retain the Sub-Adviser to render investment advisory and management services hereunder, the Adviser shall notify the Sub-Adviser in writing. If the Sub-Adviser is willing to render such services, it shall notify the Adviser in writing whereupon such additional series shall become subject to this Agreement. 3. For the services and facilities described in Section 1, the Adviser will pay to the Sub-Adviser, at the end of each calendar month, a sub-advisory fee computed at an annual rate of .35% of that portion of the average daily net assets of the initial series of the Fund that is allocated by the Adviser to the Sub-Adviser for management. For the month and year in which this Agreement becomes effective or terminates, there shall be an appropriate proration on the basis of the number of days that the Agreement is in effect during the month and year, respectively. 4. The services of the Sub-Adviser under this Agreement are not to be deemed exclusive, and the Sub-Adviser shall be free to render similar services or other services to others so long as its services hereunder are not impaired thereby. 5. The Sub-Adviser shall arrange, if desired by the Fund, for officers or employees of the Sub-Adviser to serve, without compensation from the Fund, as trustees, officers or agents of the Fund if duly elected or appointed to such positions and -4- subject to their individual consent and to any limitations imposed by law. 6. The net asset value for each series of the Fund subject to this Agreement shall be calculated as the Board of Trustees of the Fund may determine from time to time in accordance with the provisions of the Investment Company Act of 1940. On each day when net asset value is not calculated, the net asset value of a series shall be deemed to be the net asset value of such series as of the close of business on the last day on which such calculation was made for the purpose of the foregoing computations. 7. Subject to applicable statutes and regulations, it is understood that certain trustees, officers or agents of the Fund are or may be interested in the Sub-Adviser as officers, directors, agents, shareholders or otherwise, and that the officers, directors, shareholders and agents of the Sub-Adviser may be interested in the Fund otherwise than as a trustee, officer or agent. 8. The Sub-Adviser shall not be liable for any error of judgment or of law or for any loss suffered by the Fund or the Adviser in connection with the matters to which this Agreement relates, except loss resulting from willful misfeasance, bad faith or gross negligence on the part of the Sub-Adviser in the performance of its obligations and duties or by reason of its reckless disregard of its obligations and duties under this Agreement. 9. This Agreement shall become effective with respect to the initial series of the Fund on the date hereof and shall remain in full force until March 1, 1998, unless sooner terminated as hereinafter provided. This Agreement shall continue in force from year to year thereafter with respect to each such series, but only as long as such continuance is specifically approved for each series at least annually in the manner required by the Investment Company Act of 1940 and the rules and regulations thereunder; provided, however, that if the continuation of this Agreement is not approved for a series, the Sub-Adviser may continue to serve in such capacity for such series in the manner and to the extent permitted by the Investment Company Act of 1940 and the rules and regulations thereunder. This Agreement shall automatically terminate in the event of its assignment or in the event of the termination of the Management Agreement and may be terminated at any time with respect to any series subject to this Agreement without the payment of any penalty by the Adviser or by the Sub-Adviser on sixty (60) days written notice to the other party. The Fund may effect termination with respect to any such series without -5- payment of any penalty by action of the Board of Trustees or by vote of a majority of the outstanding voting securities of such series on sixty (60) days written notice to the Adviser and the Sub-Adviser. This Agreement may be terminated with respect to any series at any time without the payment of any penalty by the Board of Trustees of the Fund, by vote of a majority of the outstanding voting securities of such series or by the Adviser in the event that it shall have been established by a court of competent jurisdiction that the Sub-Adviser or any officer or director of the Sub-Adviser has taken any action which results in a breach of the covenants of the Sub-Adviser set forth herein. The terms "assignment" and "vote of a majority of the outstanding voting securities" shall have the meanings set forth in the Investment Company Act of 1940 and the rules and regulations thereunder. Termination of this Agreement shall not affect the right of the Sub-Adviser to receive payments on any unpaid balance of the compensation described in Section 3 earned prior to such termination. 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. This Agreement shall be construed in accordance with applicable federal law and the laws of the State of Illinois. -6- 13. 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. IN WITNESS WHEREOF, the Adviser and the Sub-Adviser have caused this Agreement to be executed as of the day and year first above written. ZURICH KEMPER INVESTMENTS, INC. By:/s/ Patrick H. Dudasik -------------------------------- Title: Senior Vice President ----------------------------- ZURICH INVESTMENT MANAGEMENT LIMITED By:/s/ Dennis H. Ferro --------------------------------- Title: Managing Director ----------------------------- -7- ~~-----END PRIVACY-ENHANCED MESSAGE-----~~