Rule 497(e) and (g)
File Nos.: 002-85378
811-3462
SUPPLEMENT TO PROSPECTUS
DATED MARCH 26, 1998
The accompanying Prospectus of The Flex-funds Highlands Growth Fund dated
April 30, 1997 (the "Prospectus") lists Dreman Value Advisors, L.P. ("Dreman")
as Sector Adviser to the finance sector of the Growth Stock Portfolio (the
"Portfolio), in which all of the investable assets of The Highlands Growth Fund
are invested. Dreman has experienced a change of ownership due to its recent
merger with Scudder, Stevens & Clark, Inc. Scudder Kemper Investments, Inc.
("Scudder Kemper") is the successor by merger to Dreman. Under the Investment
Company Act of 1940, Dreman's merger has resulted in the "assignment" and
termination of the Money Manager Agreement, effective December 31, 1996, among
the Portfolio, Dreman and Sector Capital Management, L.L.C. (the "Subadviser").
Effective March 26, 1998, the Subadviser has selected, with the
approval of the Portfolio Trustees, Scudder Kemper as Sector Adviser to manage
the assets of the Portfolio representing the finance sector. Accordingly the
following information about Scudder Kemper should be added under the caption
"Sector Advisers," which begins on page 10 of the Prospectus:
"SCUDDER KEMPER INVESTMENTS, INC. serves as Sector Adviser to
the finance sector of the Portfolio. Scudder Kemper is a registered
investment adviser which has been providing investment services to
individuals, banks, investment companies, pension and profit sharing
plans, charitable organizations, corporations and other institutions
for more than seventy years. As of January 31, 1998, Scudder Kemper
held discretionary investment authority over approximately $210 billion
of assets. Scudder Kemper is approximately 70% owned by Zurich
Insurance Company, with the balance owned by Scudder Kemper's officers
and employees. Jonathan Kay is the portfolio manager primarily
responsible for the day-to-day management of those assets of the
Portfolio allocated to Scudder Kemper. Mr. Kay has been associated with
Scudder Kemper since 1993. From 1990 to 1993, Mr. Kay was an associate
with J.S. Eliezer, a management consulting firm serving primarily the
media industry. Scudder Kemper's principal executive offices are
located at 345 Park Avenue, New York, NY 10017."
