February 24, 1998
LEXINGTON SMALLCAP VALUE FUND, INC.
SUPPLEMENT TO PROSPECTUS DATED MAY 1, 1997
On February 12, 1998 the Board of Directors of the Fund approved several
changes that are subject to shareholder approval. A special meeting of
shareholders is scheduled for March 27, 1998 to consider the following
proposals:
1. Approval of a Sub-Advisory Agreement between Lexington Management
Corporation ("Lexington") and Market Systems Research Advisors,
Inc. ("MSR").
MSR is currently the sub-advisor to another Lexington fund and is
an affiliate of the advisor. MSR will replace Capital Technology,
Inc. as the sub-advisor. The sub-advisory fee will be paid by the
advisor.
2. Approval of a change in name and investment policy.
It is proposed that the Fund change its name to Lexington SmallCap
Fund, Inc. This change in name reflects the proposed broader
investment approach which will permit the Fund to consider both
value and growth stocks, rather than being limited to only a value
criteria. Lexington and MSR believe that this multi-faceted
process will enhance investment performance and will improve the
consistency of portfolio results over time.
Upon the approval of shareholders, these changes are expected to become
effective on March 30, 1998.
