KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND, 497, 1995-03-07

KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND
497, 1995-03-07

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<PAGE>
SUPPLEMENT TO CURRENT PROSPECTUS

KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND

The section of the Fund's prospectus entitled "Fund Management and
Expenses; Portfolio Manager" is hereby supplemented to reflect the following (to
be inserted in place of the text thereunder):

"Christopher R. Ely has recently become the Fund's Portfolio Manager.
He is a Keystone Vice President and Senior Portfolio Manager and has more
than 15 years' experience in equity investing."

March 2, 1995

<PAGE>

[LOGO] KEYSTONE
Distributors, Inc.

200 Berkeley Street
Boston, Massachusetts 02116-5034

KAGOF-P 1/95 Recycled
42.75M Paper

KEYSTONE
AMERICA

[PICTURE]

GLOBAL
OPPORTUNITIES
FUND

- --------------------------------------------------------------------------------

[LOGO]

PROSPECTUS AND
APPLICATION

<PAGE>

KEYSTONE AMERICA GLOBAL
OPPORTUNITIES FUND
PROSPECTUS JANUARY 30, 1995

Keystone America Global Opportunities Fund (the "Fund") is a diversified
open-end management investment company, commonly known as a mutual fund, that is
authorized to issue more than one series of shares ("Portfolios"). At this time,
the Fund issues shares of only one Portfolio, the Global Opportunities Portfolio
(the "Portfolio").

The Portfolio's objective is capital growth. The Portfolio's investments are
globally varied and primarily comprised of equity securities of small to medium
sized companies in a relatively early stage of development.

The Fund offers three classes of shares. Information on share classes and
their fee and sales charge structures may be found in the Fund's fee table,
"Alternative Sales Options," "Contingent Deferred Sales Charge and Waiver of
Sales Charges," "Distribution Plans," and "Fund Shares."

This prospectus concisely states information about the Fund that you should
know before investing. Please read it and retain it for future reference.

Additional information about the Fund, including information about securities
ratings, is contained in a statement of additional information and its appendix
dated January 30, 1995, which has been filed with the Securities and Exchange
Commission and is incorporated by reference into this prospectus. For a free
copy, or for other information about the Fund, write to the address or call the
telephone number provided on this page.

KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND
200 BERKELEY STREET
BOSTON, MASSACHUSETTS 02116-5034
CALL TOLL FREE 1-800-343-2898

SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK, AND SHARES ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY.

TABLE OF CONTENTS

Page
Fee Table 2
Financial Highlights 3
The Fund 6
Investment Objective and Policies 6
Investment Restrictions 8
Risk Factors 8
Pricing Shares 9
Dividends and Taxes 10
Fund Management and Expenses 11
How to Buy Shares 13
Alternative Sales Options 14
Calculation of Contingent Deferred Sales Charge and Waiver
of Sales Charges 17
Distribution Plans 18
How to Redeem Shares 19
Shareholder Services 21
Performance Data 23
Fund Shares 23
Additional Information 24
Additional Investment Information (i)
Exhibit A A-1

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<PAGE>
FEE TABLE
KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND

The purpose of this fee table is to assist investors in understanding the
costs and expenses that an investor in each class will bear directly or
indirectly. For more complete descriptions of the various costs and expenses,
see the following sections of this prospectus: "Fund Management and Expenses";
"How to Buy Shares"; "Distribution Plans"; and "Shareholder Services."
<TABLE>
<CAPTION>
Class A Shares Class B Shares Class C Shares
Front End Back End Level Load
SHAREHOLDER TRANSACTION EXPENSES Load Option Load Option<F1> Option<F2>
-------------- ---------------- ----------------
<S> <C> <C> <C>
Sales Charge ............................................. 5.75%<F3> None None
(as a percentage of offering price)
Contingent Deferred Sales Charge ......................... 0.00%<F4> 3.00% in the first year 1.00% in the first
(as a percentage of the lesser of cost or market declining to 1.00% in year and 0.00%
value of shares redeemed) the fourth year and thereafter
0.00% thereafter
Exchange Fee (per exchange)<F5> .......................... $10.00 $10.00 $10.00
ANNUAL FUND OPERATING EXPENSES<F6>
(as a percentage of average net assets)
Management Fees .......................................... 1.00% 1.00% 1.00%
12b-1 Fees ............................................... 0.25% 1.00%<F7> 1.00%<F7>
Other Expenses ........................................... 0.41% 0.41% 0.41%
---- ---- ----
Total Fund Operating Expenses ............................ 1.66% 2.41% 2.41%
==== ==== ====
<CAPTION>
EXAMPLES<F8> 1 Year 3 Years 5 Years 10 Years
------ ------- ------ --------
<S> <C> <C> <C> <C>
You would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each period:
Class A ......................................................... $73.00 $107.00 $143.00 $243.00
Class B ......................................................... $54.00 $ 95.00 $129.00 N/A
Class C ......................................................... $34.00 $ 75.00 $129.00 $275.00
You would pay the following expenses on the same investment, assuming
no redemption at the end of each period:
Class A ......................................................... $73.00 $107.00 $143.00 $243.00
Class B ......................................................... $24.00 $ 75.00 $129.00 N/A
Class C ......................................................... $24.00 $ 75.00 $129.00 $275.00

AMOUNTS SHOWN IN THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST
OR FUTURE EXPENSES. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
</TABLE>
- ---------------
<F1> Class B Shares convert tax free to Class A shares after seven calendar
years.
<F2> Class C shares are available only through dealers who have entered into
special distribution agreements with Keystone Distributors, Inc., the
Fund's principal underwriter.
<F3> The sales charge applied to purchases of Class A shares declines as the
amount invested increases. See "Alternative Sales Options."
<F4> Purchases of Class A shares in the amount of $1,000,000 or more are not
subject to a sales charge, but may be subject to a contingent deferred
sales charge of 0.25%. See the "Calculation of Contingent Deferred Sales
Charge and Waiver of Sales Charges" section of this prospectus for an
explanation of the charge.
<F5> There is no fee for exchange orders received by the Fund directly from a
shareholder over the Keystone Automated Response Line ("KARL"). (For a
description of KARL, see "Shareholder Services.")
<F6> Expense ratios are for the Fund's fiscal year ended September 30, 1994,
except "Other Expenses" have been restated to reflect estimated future
costs.
<F7> Long term shareholders may pay more than the economic equivalent of the
maximum front end sales charges permitted by rules adopted by the National
Association of Securities Dealers, Inc. ("NASD").
<F8> The Securities and Exchange Commission requires use of a 5% annual return
figure for purposes of this example. Actual return for the Fund may be
greater or less than 5%.

<PAGE>
FINANCIAL HIGHLIGHTS
KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND -- CLASS A SHARES
GLOBAL OPPORTUNITIES PORTFOLIO
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)

The following table contains important financial information relating to the
Fund and has been audited by KPMG Peat Marwick LLP, the Fund's independent
auditors. The table appears in the Fund's Annual Report and should be read in
conjunction with the Fund's financial statements and related notes, which also
appear, together with the auditors' report, in the Fund's Annual Report. The
Fund's financial statements, related notes, and auditors' report are included in
the statement of additional information. Additional information about the Fund's
performance is contained in its Annual Report, which will be made available upon
request and without charge.
<TABLE>
<CAPTION>
March 16, 1988
(Commencment of
Year Ended September 30, Operations) to
------------------------------------------------------------ September 30,
1994 1993 1992 1991 1990 1989 1988
---- ---- ---- ---- ---- ---- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE: BEGINNING OF PERIOD ........... $18.02 $ 11.69 $ 12.89 $ 9.89 $11.17 $ 9.77 $10.00
Income from investment operations
Investment income (deficit) -- net ............. (0.14) (0.14) (0.08) 0.17 0.19 0.09 0.05
Net gains (losses) on investment
and foreign currency related transactions ..... 1.60 6.47 0.23 3.06 (1.27) 1.66 (0.28)
------ ------- ------- ------ ------ ------ ------
Total from investment operations ............... 1.56 6.33 0.15 3.23 (1.08) 1.75 (0.23)
------ ------- ------- ------ ------ ------ ------
Less distributions
Dividends from investment income -- net ........ 0 0 0 (0.23) (0.12) (0.09) 0
Distributions from capital gains ............... (0.16) 0 (1.35) 0 (0.08) (0.26) 0
------ ------- ------- ------ ------ ------ ------
Total distributions ............................ (0.16) 0 (1.35) (0.23) (0.20) (0.35) 0
------ ------- ------- ------ ------ ------ ------
Net asset value: end of period ................. $19.42 $ 18.02 $ 11.69 $12.89 $ 9.89 $11.17 $ 9.77
------ ------- ------- ------ ------ ------ ------
TOTAL RETURN<F3> ............................... 8.74% 54.15% 1.81% 32.71% (9.65%) 16.94% (1.20%)<F4>
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Operating and management expenses ............ 2.01% 2.84% 2.50%<F1> 2.03%<F1> 2.00%<F1> 2.00%<F1> 1.50%<F1><F2>
Net investment income (loss) ................. (0.86%) (1.72%) (0.69%) 1.49% 1.80%<F1> 0.86% 1.42%<F1><F2>
Portfolio turnover rate ........................ 32% 64% 75% 134% 51% 13% 19%
Net assets, end of period (thousands) .......... $71,122 $29,942 $10,859 $2,159 $1,519 $1,378 $1,082
<FN>
- ----------
<F1> The "Ratio of net operating and management expenses to average net assets"
would have been 3.67%, 7.77%, 10.39%, 13.06% and 5.54% for the years ended
September 30, 1992, 1991, 1990, 1989 and the period March 16, 1988
(Commencement of Operations) to September 30, 1988, respectively.
<F2> Annualized for the period March 16, 1988 (Commencement of Operations) to
September 30, 1988.
<F3> Excluding applicable sales charges.
<F4> Annualized total return from March 16, 1988 (Commencement of Operations) to
September 30, 1988 is (2.20%).
</TABLE>

<PAGE>

FINANCIAL HIGHLIGHTS
KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND -- CLASS B SHARES
GLOBAL OPPORTUNITIES PORTFOLIO
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)

(a) Annualized for the period February 1, 1993 (Date of Initial Public Offering)
to September 30, 1993.
(b) Annualized total return for the period February 1, 1993 (Date of Initial
Public Offering) to September 30, 1993 is 42.01%.
(c) Excluding applicable sales charges.

<PAGE>
FINANCIAL HIGHLIGHTS
KEYSTONE AMERICA GLOBAL OPPORTUNITIES FUND -- CLASS C SHARES
GLOBAL OPPORTUNITIES PORTFOLIO
(FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD)

February 1, 1993
(Date of Initial
Year Ended Public Offering) to
September 30, 1994 September 30, 1993
------------------ -------------------
NET ASSET VALUE: BEGINNING OF PERIOD... $ 17.99 $ 14.04
------- -------
Income from investment operations
Investment income (deficit) -- net .... (0.15) (0.04)
Net gains (losses) on investment and
foreign currency related transactions 1.58 3.99
------- -------
Total from investment operations ...... 1.43 3.95
------- -------
Less distributions
Dividends from investment income -- net 0 0
Distributions from capital gains ...... (0.16) 0
------- -------
Total distributions ................... (0.16) 0
------- -------
Net asset value: end of period ........ $ 19.26 $ 17.99
======= =======
TOTAL RETURN (c) ...................... 8.02% 28.13%(b)
RATIOS/SUPPLEMENTAL DATA
Ratios to average net assets:
Operating and management expenses ... 2.85% 3.04%(a)
Net investment income (loss) ........ (1.62%) (1.55%)(a)
Portfolio turnover rate ............... 32% 64%
Net assets: end of period (thousands) . $50,535 $6,217

<PAGE>
THE FUND

The Fund is authorized to issue more than one Portfolio, each investing in a
different portfolio of securities. At this time, the Fund issues only shares of
the Portfolio. The Fund was formed as a Massachusetts business trust on June 17,
1987. The Fund is one of 30 funds advised by Keystone Custodian Funds, Inc.
("Keystone"). Keystone has retained the services of Credit Lyonnais
International Asset Management, North America ("Credit Lyonnais") to provide the
Portfolio with subadvisory services, subject to the supervision of the Fund's
Board of Trustees and Keystone.

GLOBAL OPPORTUNITIES PORTFOLIO --
INVESTMENT OBJECTIVE AND POLICIES

The Portfolio's primary investment objective is capital growth.

PRINCIPAL INVESTMENTS

In selecting its investments, the Portfolio attempts to identify those
companies within various countries and industries that have the best
opportunities for above-average increases in revenues and earnings and strong
prospects for continued revenue growth. In addition, the Portfolio seeks to
identify those countries and industries where economic and political factors,
including currency movements, are likely to produce above-average growth.

In pursuing its objective, the Portfolio may invest in securities of U.S.
companies and of issuers located in certain countries with developed markets as
well as those with emerging markets and the formerly communist countries of
Eastern Europe and the People's Republic of China. In its investments in
securities of issuers in the United States ("U.S.") and other countries with
developed securities markets, the Portfolio seeks to achieve its objective by
investment in equity securities of small to medium sized companies (generally
under $1 billion in market capitalization) that are in a relatively early stage
of development. In its investments in securities of issuers in countries with
emerging markets and the formerly communist countries of Eastern Europe and the
People's Republic of China, the Portfolio seeks to achieve its objective by
investing in equity securities of issuers that are managed and positioned to
take advantage of opportunities for above average increases in revenues and
earnings and have strong prospects for continued revenue growth. For this
purpose, countries with emerging markets are generally those where the per
capita income is in the low to middle ranges, as determined by the International
Bank for Reconstruction and Development ("World Bank").

It is expected that, under ordinary circumstances, at least 65% of the
Portfolio's assets will be invested in securities of issuers located in at least
three countries, one of which may be the U.S. Under ordinary circumstances, the
Portfolio invests at least 65% of its assets in equity securities.

Some examples of the securities in which the Fund may invest are common
stocks, securities convertible into common stocks or having common stock
characteristics (consisting of rights, warrants and options), preferred stocks,
debt securities convertible into or exchangeable for preferred or common stock,
debt securities of the U.S. and any foreign governments, including their
political subdivisions, debt securities of any international agency (such as the
World Bank, Asian Development Bank or Inter-American Development Bank) and time
deposits with U.S. and foreign banks, and may hold cash and cash equivalents as
discussed below. The Portfolio's securities and other assets may be denominated
in U.S. currency or currency of any foreign nation. Except as described above,
there are no limitations on the type, size, operating history or dividend paying
record of companies or industries in which the Portfolio may invest. The
Portfolio's securities may be traded in the over-the-counter market as well as
being listed on a foreign exchange. The primary investment criterion used by the
Portfolio in the selection of portfolio securities is that the securities
provide opportunities for capital growth.

Although the Portfolio intends to invest primarily in common stocks and
securities convertible into common stocks to achieve its objective of growth of
capital, the Portfolio may invest in any security listed above. For example,
because the market value of debt obligations can be expected to vary inversely
with changes in prevailing interest rates, investing in debt securities may
provide an opportunity for capital appreciation when interest rates are expected
to decline. In addition, the Fund may hold cash and invest in cash equivalents,
including time deposits, for temporary purposes in order to meet redemption
requests or for such periods of time as are necessary to evaluate market
conditions and other factors.

The Fund intends to follow policies of the Securities and Exchange Commission
as they are adopted from time to time with respect to illiquid securities,
including at this time (1) treating as illiquid securities that may not be sold
or disposed of in the ordinary course of business within seven days at
approximately the value at which the Fund has valued such securities on its
books and (2) limiting its holdings of such securities to 15% of net assets.

The Fund may invest in restricted securities, including securities eligible
for resale pursuant to Rule 144A under the Securities Act of 1933 (the "1933
Act"). Generally, Rule 144A establishes a safe harbor from the registration
requirements of the 1933 Act for resales by large institutional investors of
securities not publicly traded in the U.S. The Fund intends to purchase Rule
144A securities when such securities present an attractive investment
opportunity and otherwise meet the Fund's selection criteria. The Board of
Trustees has adopted guidelines and procedures pursuant to which Keystone
determines the liquidity of the Fund's Rule 144A securities. The Board monitors
Keystone's implementation of such guidelines and procedures.

At the present time, the Fund cannot accurately predict exactly how the market
for Rule 144A securities will develop. A Rule 144A security that was readily
marketable upon purchase may subsequently become illiquid. In such an event, the
Board of Trustees will consider what action, if any, is appropriate.

OTHER ELIGIBLE INVESTMENTS

When, in the opinion of Keystone, market conditions warrant, the Portfolio may
invest up to 100% of its assets for temporary defensive purposes in the
following types of money market instruments: (1) commercial paper, including
master demand notes, that at the date of investment is rated A-1 (the highest
grade given by S&P), PRIME-1 (the highest grade given by Moody's) or, if not
rated by such services, is issued by a company that at the date of investment
has an outstanding issue rated A or better by S&P or Moody's; (2) obligations,
including certificates of deposit and bankers' acceptances, of banks or savings
and loan associations having at least $1 billion in deposits as of the date of
their most recently published financial statements and which are members of the
Federal Deposit Insurance Corporation, including U.S. branches of foreign banks
and foreign branches of U.S. banks; (3) corporate obligations that at the date
of investment are rated A or better by S&P or Moody's; and (4) obligations
issued or guaranteed by the U.S. government or by any agency or instrumentality
of the U.S. When the Portfolio's assets are being invested for temporary
defensive purposes, the Portfolio is not pursuing its investment objective.

The Fund may enter into repurchase and reverse repurchase agreements, invest
in master demand notes, lend portfolio securities, purchase and sell securities
and currencies on a when issued and delayed delivery basis and purchase or sell
securities on a forward commitment basis, write covered call and put options and
purchase call and put options to close out existing positions and may employ new
investment techniques with respect to such options. The Fund may also enter into
currency and other financial futures contracts and related options transactions
for hedging purposes and not for speculation, and may employ new investment
techniques with respect to such futures contracts and related options.

For further information about the types of investments and investment
techniques available to the Fund, and the risks associated therewith, see the
"Risk Factors" and "Additional Investment Information" sections of this
prospectus and the statement of additional information.

Of course, there can be no assurance that the Fund will achieve its investment
objective since there is uncertainty in every investment.

FUNDAMENTAL NATURE OF INVESTMENT OBJECTIVE

The investment objective of the Portfolio is fundamental and may not be
changed without the vote of a majority of the Portfolio's outstanding shares
(which means the lesser of (1) 67% of the Portfolio's shares represented at a
meeting at which more than 50% of the Portfolio's outstanding shares are
represented or (2) more than 50% of the Portfolio's outstanding shares).

INVESTMENT RESTRICTIONS

The Fund has adopted the fundamental investment restrictions set forth below,
which may not be changed with respect to any Portfolio without the vote of a
majority of the affected Portfolio's outstanding shares. These restrictions and
certain other fundamental restrictions are set forth in the statement of
additional information.

A Portfolio may not do the following: (1) invest more than 5% of its total
assets in the securities of any one issuer (other than U.S. government
securities) except that up to 25% of its total assets may be invested without
regard to this limit; (2) borrow money, except that the Portfolio may borrow
money from banks and/or enter into reverse repurchase agreements for temporary
or emergency purposes in aggregate amounts up to one-third of the value of the
Portfolio's net assets provided that no additional investments shall be made at
any time that outstanding borrowings (including amounts payable under reverse
repurchase agreements) exceed 5% of the Portfolio's net assets; and (3) invest
more than 25% of its total assets in securities of issuers in the same industry.

RISK FACTORS

Investing in the Portfolio involves the risk common to investing in any
security, i.e., net asset value will fluctuate in response to changes in
economic conditions, interest rates and the market's perception of the
underlying securities of the Portfolio.

By itself, the Portfolio does not constitute a balanced investment plan. The
Portfolio stresses providing growth of capital by investing principally in
globally varied equity securities of small to medium sized companies in a
relatively early stage of development. The yield of the Fund's portfolio
securities will fluctuate with changing market conditions. The Fund makes most
sense for those investors who can afford to ride out changes in the stock market
because it invests a substantial portion of its assets in equities.

Investing in the Portfolio, with its globally varied investments, may involve
more risk than investing in a fund with a portfolio consisting solely of
securities of domestic issuers for the following reasons: (1) there may be less
public information available about foreign companies than is available about
U.S. companies; (2) foreign companies are not generally subject to the uniform
accounting, auditing and financial reporting standards and practices applicable
to U.S. companies; (3) foreign stock markets have less volume than the U.S.
market, and the securities of some foreign companies are much less liquid and
much more volatile than the securities of comparable U.S. companies; (4) foreign
securities transactions may involve higher brokerage commissions; (5) there may
be less government regulation of stock markets, brokers, listed companies and
banks in foreign countries than in the U.S.; (6) the Portfolio may incur fees on
currency exchanges when it changes investments from one country to another; (7)
the Portfolio's foreign investments could be affected by expropriation,
confiscatory taxation, nationalization, establishment of currency exchange
controls, political or social instability or diplomatic developments; (8)
fluctuations in foreign exchange rates will affect the value of the Portfolio's
investments, the value of dividends and interest earned, gains and losses
realized on the sale of securities, net investment income and unrealized
appreciation or depreciation of investments; (9) interest and dividends on
foreign securities may be subject to withholding taxes in a foreign country that
could result in a reduction of net investment income available for distribution;
and (10) to the extent the Portfolio invests in securities of issuers located in
the formerly communist countries of Eastern Europe and the People's Republic of
China, there is the risk that those countries could convert back to a single
economic structure.

Investing in securities of issuers in emerging markets countries involves
exposure to economic systems that are generally less mature and political
systems that are generally less stable than, those of developed countries. In
addition, investing in companies in emerging markets countries may also involve
exposure to national policies that may restrict investment by foreigners and
undeveloped legal systems governing private and foreign investments and private
property. The typically small size of the markets for securities issued by
companies in emerging markets countries and the possibility of a low or
nonexistent volume of trading in those securities may also result in a lack of
liquidity and in price volatility of those securities. Furthermore, investing in
securities of companies in the formerly communist countries of Eastern Europe
and the People's Republic of China involve additional risks to those associated
with investments in companies in non-formerly communist emerging markets
countries. Specifically, those countries could convert back to a single economic
system, and the claims of property owners prior to the expropriation by the
communist regime could be settled in favor of the former property owners, in
which case the Portfolio could lose its entire investment in those countries.

If and when the Fund invests in zero coupon bonds, the Fund does not expect to
have enough zero coupon bonds to have a material effect on dividends. The Fund
has undertaken to a state securities authority to disclose that zero coupon
securities pay no interest to holders prior to maturity, and that the interest
on these securities is reported as income to the Fund and distributed to its
shareholders. These distributions must be made from the Fund's cash assets or,
if necessary, from the proceeds of sales of portfolio securities. The Fund will
not be able to purchase additional income producing securities with cash used to
make such distributions, and its current income ultimately may be reduced as a
result.

Past performance should not be considered representative of results for any
future period of time. Moreover, should many shareholders change from this Fund
to some other investment at about the same time, the Fund might have to sell
portfolio securities at a time when it would be disadvantageous to do so and at
a lower price than if such securities were held to maturity or until an
investment decision is made to dispose of them.

For additional information regarding the Fund's investments in Rule 144A
securities, see "Investment Objective and Policies". For further information
about the types of investments and investment techniques available to the Fund,
including the associated risks, see "Additional Investment Information" and the
statement of additional information.

PRICING SHARES

The net asset value of a Portfolio share is computed each day on which the New
York Stock Exchange (the "Exchange") is open as of the close of trading on the
Exchange (currently 4:00 p.m. Eastern time for purposes of pricing Fund shares)
except on days when changes in the value of the Portfolio's securities do not
affect the current net asset value of its shares. The Exchange currently is
closed on weekends, New Year's Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day. The net asset
value per share of the Portfolio is arrived at by determining the value of the
Portfolio's assets, subtracting its liabilities and dividing the result by the
number of its shares outstanding.

Current values for the Portfolio's securities are determined in the following
manner:

1. securities that are traded on a national securities exchange or on
the over-the-counter National Market System ("NMS") are valued on the
basis of the last sales price on the exchange where primarily traded or
NMS prior to the time of the valuation, provided that a sale has occurred
and that this price reflects current market value according to procedures
established by the Board of Trustees;

2. securities traded in the over-the-counter market, other than NMS, for
which market quotations are readily available, are valued at the mean of
the bid and asked prices at the time of valuation;

3. instruments having maturities of more than sixty days for which
market quotations are readily available are valued at current market
value; where market quotations are not available, such instruments are
valued at fair value as determined by the Board of Trustees;

4. instruments that are purchased with maturities of sixty days or less
(including all master demand notes) are valued at amortized cost (original
purchase cost as adjusted for amortization of premium or accretion of
discount), which, when combined with accrued interest, approximates
market; instruments maturing in more than sixty days when purchased that
are held on the sixtieth day prior to maturity are valued at amortized
cost (market value on the sixtieth day adjusted for amortization of
premium or accretion of discount), which, when combined with accrued
interest, approximates market; and which in either case reflects fair
value as determined by the Fund's Board of Trustees; and

5. the following securities are valued at prices deemed in good faith to
be fair under procedures established by the Board of Trustees: (a)
securities, including restricted securities, for which complete quotations
are not readily available; (b) listed securities or those on NMS if, in
the Fund's opinion, the last sales price does not reflect a current market
value or if no sale occurred; and (c) other assets.

Foreign securities are valued on the basis of valuations provided by a pricing
service, approved by the Fund's Board of Trustees, which uses information with
respect to transactions in such securities, quotations from broker-dealers,
market transactions in comparable securities and various relationships between
securities and yield to maturity in determining value.

DIVIDENDS AND TAXES

The Portfolio has qualified and intends to qualify in the future as a
regulated investment company under the Internal Revenue Code (the "Code"). The
Portfolio qualifies if, among other things, it distributes to its shareholders
at least 90% of its net investment income for its fiscal year. The Portfolio
also intends to make timely distributions, if necessary, sufficient in amount to
avoid the nondeductible 4% excise tax imposed on a regulated investment company
to the extent that it fails to distribute, with respect to each calendar year,
at least 98% of its ordinary income for such calendar year and 98% of its net
capital gains for the one-year period ending on October 31 of such calendar
year. Any taxable distributions would be (1) declared in October, November, or
December to shareholders of record in such a month, (2) paid by the following
January 31, and (3) includable in the taxable income of the shareholder for the
year in which such distributions were declared. If the Portfolio qualifies and
if it distributes substantially all of its net investment income and net capital
gains, if any, to shareholders, it will be relieved of any federal income tax
liability. The Portfolio will make distributions from its net investment income
and net capital gains, if any, annually. Because Class A shares bear most of the
costs of distribution of such shares through payment of a front end sales charge
while Class B and Class C shares bear such expenses through a higher annual
distribution fee, expenses attributable to Class B shares and Class C shares
will generally be higher, and income distributions paid by the Fund with respect
to Class A shares will generally be greater than those paid with respect to
Class B and Class C shares.

Portfolio distributions are payable in shares of the Portfolio or, at your
option (which must be exercised before the record date for the distribution), in
cash. Distributions are reinvested at net asset value without any sales charge.
Dividends and distributions are taxable whether or not they are reinvested.
Income dividends and net short-term gains dividends are taxable as ordinary
income, and net long-term gains are taxable as capital gains regardless of how
long you have held the Portfolio's shares. If Portfolio shares held for less
than six months are sold at a loss, such loss will be treated for tax purposes
as a long-term capital loss to the extent of any long-term capital gains
dividends received. Dividends and distributions may also be subject to state and
local taxes. The Portfolio advises its shareholders annually as to the federal
tax status of all distributions made during the year.

If more than 50% of the value of the Portfolio's total assets at the end of a
fiscal year is represented by securities of foreign corporations and the
Portfolio elects to make foreign tax credits available to its shareholders, a
shareholder will be required to include in his gross income both cash dividends
and the amount the Portfolio advises him is his pro rata portion of income taxes
withheld by foreign governments from interest and dividends paid on the
Portfolio's investments. The shareholder will be entitled, however, to take the
amount of such foreign taxes withheld as a credit against his U.S. income tax,
or to treat the foreign tax withheld as an itemized deduction from his gross
income, if that should be to his advantage. In substance, this policy enables
the shareholder to benefit from the same foreign tax credit or deduction that he
would have received if he had been the individual owner of foreign securities
and had paid foreign income tax on the income therefrom. As in the case of
individuals receiving income directly from foreign sources, the above described
tax credit and deductions are subject to certain limitations.

In the event the Fund establishes additional Portfolios, each Portfolio will
be considered, and intends to qualify as, a regulated investment company.

FUND MANAGEMENT AND EXPENSES

BOARD OF TRUSTEES

Under Massachusetts law, the Fund's Board of Trustees has absolute and
exclusive control over the management and disposition of all assets of the Fund.
Subject to the general supervision of the Board of Trustees, Keystone provides
investment advice, management and administrative services to the Fund.

INVESTMENT ADVISER

Keystone, located at 200 Berkeley Street, Boston, Massachusetts 02116-5034,
has provided investment advisory and management services to investment companies
and private accounts since it was organized in 1932. Keystone is a wholly-owned
subsidiary of Keystone Group, Inc. ("Keystone Group"), located at 200 Berkeley
Street, Boston, Massachusetts 02116-5034.

Keystone Group is a corporation privately owned by current and former members
of management of Keystone and its affiliates. The shares of Keystone Group
common stock beneficially owned by management are held in a number of voting
trusts, the trustees of which are George S. Bissell, Albert H. Elfner, III,
Roger T. Wickers, Edward F. Godfrey and Ralph J. Spuehler, Jr. Keystone Group
provides accounting, bookkeeping, legal, personnel and general corporate
services to Keystone Management, Inc., Keystone, their affiliates and the
Keystone Group of Mutual Funds.

Pursuant to its Investment Advisory and Management Agreement (the "Advisory
Agreement") with the Fund, Keystone provides investment advisory and management
services to the Fund. Keystone manages the investment and reinvestment of the
Fund's assets, supervises the operation of the Fund, provides all necessary
office space, facilities, equipment and personnel and arranges at the request of
the Fund for its employees to serve as officers or agents of the Fund.

The Fund pays Keystone a fee for its services with respect to the Fund at the
annual rate set forth below:
Aggregate Net Asset Value
Management of the Shares
Fee of the Fund
- --------------------------------------------------------------------------------
1.00% of the first $200,000,000, plus
0.95% of the next $200,000,000, plus
0.85% of the next $200,000,000, plus
0.75% of amounts over $600,000,000;

computed as of the close of business each business day and paid daily.

For the year ended September 30, 1994, the Fund paid or accrued to Keystone
investment management and administrative services fees of $1,618,327, which
represented 1.00% of the Fund's average net assets on an annualized basis. Of
such amount, Keystone retained $809,164 for its services to the Fund.

The Advisory Agreement continues in effect from year to year only so long as
such continuance is specifically approved at least annually by the Board of
Trustees or by vote of a majority of the outstanding shares of the Fund. In
either case, the terms of the Advisory Agreement and continuance thereof must be
approved by the vote of a majority of Independent Trustees in person at a
meeting called for the purpose of voting on such approval. The Advisory
Agreement may be terminated, without penalty, on 60 days' written notice by the
Fund or Keystone or may be terminated by a vote of shareholders of the Fund. The
Advisory Agreement will terminate automatically upon its assignment.

SUB-ADVISER

Keystone has entered into a Subadvisory Agreement with Credit Lyonnais
International Asset Management, North America ("CLIAM"), an international
investment management firm located at 1301 Avenue of the Americas, New York, New
York 10019. CLIAM is a subsidiary of Credit Lyonnais, which is among the world's
largest banks, with $250 billion in assets and offices in 76 countries. Under
the Subadvisory Agreement, CLIAM provides the Fund with certain investment
advisory services, and Keystone pays CLIAM at the beginning of each fiscal
quarter a fee that represents 50% of the management fee paid by the Fund to
Keystone for the preceding quarter. The Fund has no responsibility to pay
CLIAM's fee.

The Subadvisory Agreement continues in effect from year to year only so long
as such continuance is specifically approved at least annually by the Board of
Trustees or by vote of a majority of the outstanding shares of the Fund. In
either case, the terms of the Subadvisory Agreement and continuance thereof must
be approved by the vote of a majority of Independent Trustees in person at a
meeting called for the purpose of voting on such approval. The Subadvisory
Agreement may be terminated, without penalty, on 60 days' written notice by the
Fund or Keystone or may be terminated by a vote of shareholders of the Fund. The
Subadvisory Agreement will terminate automatically upon its assignment.

For the year ended September 30, 1994, Keystone paid or accrued $809,163 to
CLIAM for its services as subadviser to the Fund.

The Fund has adopted a Code of Ethics incorporating policies on personal
securities trading as recommended by the Investment Company Institute.

FUND EXPENSES

The Portfolio will pay all of its expenses. In addition to the investment
management and distribution plan fees discussed herein, the principal expenses
that the Portfolio is expected to pay include, but are not limited to, expenses
of certain of its Trustees; transfer, dividend disbursing and shareholder
servicing agent expenses; custodian expenses; fees of its independent auditors
and legal counsel to its Trustees; fees payable to government agencies,
including registration and qualification fees attributable to the Portfolio and
its shares under federal and state securities laws; and certain extraordinary
expenses. In addition, each class will pay all of the expenses attributable to
it. Such expenses are currently limited to Distribution Plan expenses. The
Portfolio also pays its brokerage commissions, interest charges and taxes.

For the fiscal year ended September 30, 1994, the Portfolio's Class A shares
paid 2.01% of Class A average net assets in expenses. For the fiscal year ended
September 30, 1994, the Portfolio's Class B and Class C shares paid, on an
annualized basis, 2.83% and 2.85%, respectively of their average net assets in
expenses.

During the fiscal year ended September 30, 1994, the Portfolio paid or accrued
to Keystone Investor Resource Center, Inc. ("KIRC"), the Fund's transfer and
dividend disbursing agent, and Keystone Group $22,520 for certain accounting and
printing services and $742,785 for transfer agent fees. KIRC is a wholly-owned
subsidiary of Keystone.

PORTFOLIO MANAGER

Roland W. Gillis has been the Fund's portfolio manager since 1989. He is a
Keystone Vice President and Senior Portfolio Manager and has more than 19 years'
experience in equity investing.

SECURITIES TRANSACTIONS

Under policies established by the Board of Trustees, Keystone selects
broker-dealers to execute transactions subject to the receipt of best execution.
When selecting broker-dealers to execute portfolio transactions for the
Portfolio, Keystone may follow a policy of considering as a factor the number of
shares of the Portfolio sold by such broker-dealer. In addition, broker-dealers
executing portfolio transactions from time to time may be affiliated with the
Fund, Keystone, the Fund's principal underwriter or their affiliates.

The Portfolio may pay higher commissions to broker-dealers that provide
research services. Keystone may use these services in advising the Portfolio as
well as in advising its other clients.

PORTFOLIO TURNOVER

The turnover rates for each of the Portfolio's Class A, Class B and Class C
shares for the fiscal year ended September 30, 1994 and 1993 were 32% and 64%,
respectively. High portfolio turnover may involve correspondingly greater
brokerage commissions and other transaction costs, which would be borne directly
by the Fund, as well as additional realized gains and/or losses to shareholders.
For further information about brokerage and distributions, see the statement of
additional information.

HOW TO BUY SHARES

You may purchase shares of the Portfolio from any broker-dealer that has a
selling agreement with KDI, the Fund's Principal Underwriter. KDI, a
wholly-owned subsidiary of Keystone, is located at 200 Berkeley Street, Boston,
Massachusetts 02116-5034.

In addition, you may open an account for the purchase of shares of the
Portfolio by mailing to the Fund c/o KIRC, P.O. Box 2121, Boston, Massachusetts
02106-2121, a completed account application and a check payable to the Fund, or
you may telephone 1-800-343-2898 to obtain the number of an account to which you
can wire or electronically transfer funds and then send in a completed account
application. Subsequent investments in any amount may be made by check, by
wiring Federal funds or by an electronic funds transfer ("EFT").

Orders for the purchase of shares of the Fund will be confirmed at an offering
price equal to the net asset value per share next determined after receipt of
the order in proper form by KDI (generally as of the close of the Exchange on
that day) plus, in the case of Class A shares, the applicable sales charge.
Orders received by dealers or other firms prior to the close of the Exchange and
received by KDI prior to the close of its business day will be confirmed at the
offering price effective as of the close of the Exchange on that day. The Fund
reserves the right to determine the net asset value more frequently than once a
day if deemed desirable. Dealers and other financial services firms are
obligated to transmit orders promptly.

Orders for shares received by broker-dealers prior to that day's close of
trading on the Exchange and transmitted to the Fund prior to its close of
business that day will receive the offering price which is the net asset value
per share computed at the close of trading on the Exchange on the same day plus,
in the case of Class A shares, the applicable sales charge. Orders received by
broker-dealers after that day's close of trading on the Exchange and transmitted
to the Fund prior to the close of business on the next business day will receive
the next business day's offering price.

Orders for the purchase of shares of the Fund will be confirmed at an offering
price equal to the net asset value per share next computed after the Fund
receives the purchase order plus, in the case of Class A shares, the applicable
sales charge.

The initial purchase must be at least $1,000 for Class A, Class B and Class C
shares. There is no minimum amount for subsequent purchases.

The Fund reserves the right to withdraw all or any part of the offering made
by this prospectus and to reject purchase orders.

Shareholder inquiries should be directed to KIRC by calling toll free 1-800-
343-2898 or writing to KIRC or to the firm from which you received this
prospectus.

ALTERNATIVE SALES OPTIONS

The Portfolio offers three classes of shares:

CLASS A SHARES -- FRONT END LOAD OPTION

Class A shares are sold with a sales charge at the time of purchase. Class A
shares are not subject to a sales charge when they are redeemed (except that
shares sold in a single purchase in excess of $1,000,000 without a front end
sales charge will be subject to a contingent deferred sales charge for one
year).

CLASS B SHARES -- BACK END LOAD OPTION

Class B shares are sold without a sales charge at the time of purchase, but
are subject to a deferred sales charge if they are redeemed within three
calendar years after the calendar year of purchase. Class B shares will
automatically convert to Class A shares at the end of seven calendar years after
purchase.

CLASS C SHARES -- LEVEL LOAD OPTION

Class C shares are sold without a sales charge at the time of purchase, but
are subject to a deferred sales charge if they are redeemed within one year
after the date of purchase. Class C shares are available only through dealers
who have entered into special distribution agreements with KDI.

Each class of shares, pursuant to its Distribution Plan, each pays an annual
service fee of 0.25% of the Fund's average daily net assets attributable to that
class. In addition to the 0.25% service fee, the Class B and C Distribution
Plans provide for the payment of an annual distribution fee of up to 0.75% of
the average daily net assets attributable to their respective classes. As a
result, income distributions paid by the Portfolio with respect to Class B and
Class C shares will generally be less than those paid with respect to Class A
shares.

Investors who would rather pay the entire cost of distribution at the time of
investment, rather than spreading the cost over time, might consider Class A
shares. Other investors might consider Class B or Class C shares, in which case
100% of the purchase price is invested immediately, depending on the amount of
the purchase and the intended length of investment. The Portfolio will not
normally accept any purchase of Class B shares in the amount of $250,000 or more
and will not normally accept any purchase of Class C shares in the amount of
$1,000,000 or more.

-----------------------------------
CLASS A SHARES

Class A shares are offered at net asset value plus an initial sales charge as
follows:
As a % of Concession to
As a % of Net Amount Dealers as a % of
Amount of Purchase Offering Price Invested* Amount Invested
- --------------------------------------------------------------------------------
Less than $50,000 5.75% 6.10% 5.25%
$50,000 but less than $100,000 4.75% 4.99% 4.25%
$100,000 but less than $250,000 3.75% 3.90% 3.25%
$250,000 but less than $500,000 2.50% 2.56% 2.25%
$500,000 but less than $1,000,000 1.50% 1.52% 1.50%
$1,000,000 and over** 0% 0% 0.25%

- -------------
* Rounded to the nearest one-hundredth percent.
** Purchases of $1,000,000 or more may be subject to a contingent deferred sales
charge of 0.25%. See the "Calculation of Contingent Deferred Sales Charge and
Waiver of Sales Charges" section of this prospectus.

-----------------------------------

The sales charge is paid to KDI which in turn normally reallows a portion to
your broker-dealer. In addition, your broker-dealer currently will be paid
periodic service fees at an annual rate of up to 0.25% of the average daily net
asset value of outstanding shares of Class A sold by your dealer.

Upon written notice to dealers with whom it has dealer agreements, KDI may
reallow up to the full applicable sales charge.

Initial sales charges may be eliminated for persons purchasing Class A shares
to be includedin a broker-dealer managed fee based program(a "wrap account")
with broker-dealers who have entered into special agreements with KDI. Initial
sales charges may be reduced or eliminated for persons or organizations
purchasing Class A shares of the Fund alone or in combination with Class A
shares of other Keystone America Funds. See Exhibit A to this prospectus.

Upon prior notification to KDI, Class A shares may be purchased at net asset
value by clients of registered representatives within six months after a change
in the registered representative's employment, where the amount invested
represents redemption proceeds from a registered open-end management investment
company not distributed or managed by Keystone or its affiliates; and the
shareholder either (i) paid a front end sales charge, or (ii) was at some time
subject to, but did not actually pay, a contingent deferred sales charge with
respect to the redemption proceeds.

In addition, since January 1, 1995 and through June 30, 1995 ("offering
period") and upon prior notification to KDI, Class A shares may be purchased at
net asset value by clients of registered representatives within six months after
the redemption of shares of any registered open-end investment company not
distributed or managed by Keystone or its affiliates, where the amount invested
represents redemption proceeds from such unrelated registered open-end
investment company, and the shareholder either (i) paid a front end sales
charge, or (ii) was at some time subject to, but did not actually pay, a
contingent deferred sales charge with respect to the redemption proceeds.

With certain exceptions, purchases of Class A shares in the amount of
$1,000,000 or more on which no sales charge has been paid will be subject to a
contingent deferred sales charge of 0.25% upon redemption during the one year
period commencing on the date the shares were originally purchased. The
contingent deferred sales charge is retained by KDI. See "Calculation of
Contingent Deferred Sales Charge and Waiver of Sales Charges" below.

CLASS A DISTRIBUTION PLAN

The Portfolio has adopted a Distribution Plan with respect to its Class A
shares (the "Class A Distribution Plan") that provides for expenditures, which
are currently limited to 0.25% annually of the average daily net asset value of
Class A shares, in connection with the distribution of Class A shares. Payments
under the Class A Distribution Plan are currently made to KDI (which may reallow
all or part to others, such as dealers), as service fees at an annual rate of up
to 0.25% of the average daily net asset value of Class A shares maintained by
the recipients outstanding on the books of the Portfolio for specified periods.

CLASS B SHARES

Class B shares are offered at net asset value, without an initial sales
charge. With certain exceptions, the Portfolio may impose a deferred sales
charge of 3.00% on shares redeemed during the calendar year of purchase and the
first calendar year after the year of purchase; 2.00% on shares redeemed during
the second calendar year after the year of purchase; and 1.00% on shares
redeemed during the third calendar year after the year of purchase. No deferred
sales charge is imposed on amounts redeemed thereafter. If imposed, the deferred
sales charge is deducted from the redemption proceeds otherwise payable to you.
The deferred sales charge is retained by KDI. Amounts received by KDI under the
Class B Distribution Plan are reduced by deferred sales charges retained by KDI.
See "Calculation of Contingent Deferred Sales Charge and Waiver of Sales
Charges" below.

Class B shares that have been outstanding during seven calendar years will
automatically convert to Class A shares which are subject to a lower
Distribution Plan charge, without imposition of a front end sales charge or
exchange fee. (Conversion of Class B shares represented by stock certificates
will require the return of the stock certificates to KIRC.) The Class B shares
so converted will no longer be subject to the higher expenses borne by Class B
shares. Because the net asset value per share of the Class A shares may be
higher or lower than that of the Class B shares at the time of conversion,
although the dollar value will be the same, a shareholder may receive more or
less Class A shares than the number of Class B shares converted. Under current
law, it is the Fund's opinion that such a conversion will not constitute a
taxable event under federal income tax law. In the event that this ceases to be
the case, the Board of Trustees will consider what action, if any, is
appropriate and in the best interests of the Class B shareholders.

CLASS B DISTRIBUTION PLAN

The Portfolio has adopted a Distribution Plan with respect to its Class B
shares (the "Class B Distribution Plan") that provides for expenditures at an
annual rate of up to 1.00% of the average daily net asset value of Class B
shares to pay expenses of the distribution of Class B shares. Payments under the
Class B Distribution Plan are currently made to KDI (which may reallow all or
part to others, such as dealers) (1) as commissions for Class B shares sold and
(2) as shareholder service fees. Amounts paid or accrued to KDI under (1) and
(2) in the aggregate may not exceed the annual limitation referred to above. KDI
generally reallows to brokers or others a commission equal to 3% of the price
paid for each Class B share sold and the shareholder service fee, which is paid
at the rate of 0.25% per annum of the net asset value of shares maintained by
the recipients outstanding on the books of the Portfolio for specified periods.
See "Distribution Plans" below.

CLASS C SHARES

Class C shares are available only through dealers who have entered into
special distribution agreements with KDI. Class C shares are offered at net
asset value, without an initial sales charge. With certain exceptions, the Fund
may impose a deferred sales charge of 1.00% on shares redeemed within one year
after the date of purchase. No deferred sales charge is imposed on amounts
redeemed thereafter. If imposed, the deferred sales charge is deducted from the
redemption proceeds otherwise payable to you. The deferred sales charge is
retained by KDI. See "Calculation of Contingent Deferred Sales Charge and Waiver
of Sales Charges" below.

CLASS C DISTRIBUTION PLAN

The Portfolio has adopted a Distribution Plan with respect to its Class C
shares (the "Class C Distribution Plan") that provides for expenditures at an
annual rate of up to 1.00% of the average daily net asset value of Class C
shares to pay expenses of the distribution of Class C shares. Payments under the
Class C Distribution Plan are currently made to KDI (which may reallow all or
part to others, such as dealers) (1) as commissions for Class C shares sold and
(2) as shareholder service fees. Amounts paid or accrued to KDI under (1) and
(2) in the aggregate may not exceed the annual limitation referred to above. KDI
generally reallows to brokers or others a commission in the amount of 0.75% of
the price paid for each Class C share sold, plus the first year's service fee in
advance in the amount of 0.25% of the price paid for each Class C share sold,
and, beginning approximately fifteen months after purchase, a commission at an
annual rate of 0.75% (subject to the NASD rule -- see "Distribution Plans") plus
service fees which are paid at the annual rate of 0.25%, respectively, of the
average daily net asset value of each share maintained by the recipients
outstanding on the books of the Portfolio for specified periods. See
"Distribution Plans" below.

CALCULATION OF CONTINGENT DEFERRED
SALES CHARGE AND WAIVER OF
SALES CHARGES

Any contingent deferred sales charge imposed upon the redemption of Class A,
Class B or Class C shares is a percentage of the lesser of (1) the net asset
value of the shares redeemed or (2) the net cost of such shares. No contingent
deferred sales charge is imposed when you redeem amounts derived from (1)
increases in the value of your account above the net cost of such shares due to
increases in the net asset value per share of the Portfolio shares; (2) certain
shares with respect to which the Portfolio did not pay a commission on issuance,
including shares acquired through reinvestment of dividend income and capital
gains distributions; (3) Class C shares and certain Class A shares held for more
than one year from the date of purchase; or (4) Class B shares held during more
than four consecutive calendar years. Upon request for redemption, shares not
subject to the contingent deferred sales charge will be redeemed first.
Thereafter, shares held the longest will be the first to be redeemed.

The Portfolio may also sell Class A, Class B or Class C shares at net asset
value without any initial sales charge or a contingent deferred sales charge to
certain Directors, Trustees, officers and employees of the Fund and Keystone and
certain of their affiliates, to registered representatives of firms with dealer
agreements with KDI and to a bank or trust company acting as a trustee for a
single account.

In addition, no contingent deferred sales charge is imposed on a redemption of
shares of the Portfolio in the event of (1) death or disability of the
shareholder; (2) a lump-sum distribution from a 401(k) plan or other benefit
plan qualified under the Employee Retirement Income Security Act of 1974
("ERISA"); (3) automatic withdrawals from ERISA plans if the shareholder is at
least 59 1/2 years old; (4) involuntary redemptions of accounts having an
aggregate net asset value of less than $1,000; or (5) automatic withdrawals
under an automatic withdrawal plan of up to 1 1/2% per month of the
shareholder's initial account balance.

ARRANGEMENTS WITH BROKER-DEALERS AND OTHERS

From time to time, KDI may, provide promotional incentives, including
reallowance of up to the entire sales charge, to certain dealers whose
representatives have sold or are expected to sell significant amounts of Fund
shares. In addition, from time to time, dealers may receive additional cash
payments. KDI may provide written information to dealers with whom it has dealer
agreements that relates to sales incentive campaigns conducted by such dealers
for their representatives as well as financial assistance in connection with
pre-approved seminars, conferences and advertising. No such programs or
additional compensation will be offered to the extent they are prohibited by the
laws of any state or any self-regulatory agency such as the NASD. Dealers to
whom substantially the entire sales charge on Class A shares is reallowed may be
deemed to be underwriters as that term is defined under the Securities Act of
1933.

KDI may, at its own expense, pay concessions in addition to those described
above to dealers which satisfy certain criteria established from time to time by
KDI. These conditions relate to increasing sales of shares of the Keystone funds
over specified periods and certain other factors. Such payments may, depending
on the dealer's satisfaction of the required conditions, be up to .25% of the
value of shares sold by such dealer.

KDI may also pay a transaction fee (up to the level of payments allowed to
dealers for the sale of shares, as described above) to banks and other financial
services firms that facilitate transactions in shares of the Fund for their
clients.

The Glass-Steagall Act currently limits the ability of a depository
institution (such as a commercial bank or a savings and loan association) to
become an underwriter or distributor of securities. In the event the
Glass-Steagall Act is deemed to prohibit depository institutions from accepting
payments under the arrangement described above, or should Congress relax current
restrictions on depository institutions, the Board of Trustees will consider
what action, if any, is appropriate.

In addition, state securities laws on this issue may differ from the
interpretations of federal law expressed herein, and banks and financial
institutions may be required to register as dealers pursuant to state law.

DISTRIBUTION PLANS

The Portfolio bears some of the costs of selling its shares under Distribution
Plans adopted with respect to its Class A, Class B and Class C shares pursuant
to Rule 12b-1 under the 1940 Act. Payments under the Class A Distribution Plan
are currently limited to up to 0.25% annually of the average daily net asset
value of Class A shares and are used to pay shareholder service fees. The Class
B Distribution Plan and the Class C Distribution Plan provide for the payment at
an annual rate of up to 1.00% of the average daily net asset value of Class B
shares and Class C shares, respectively of which .25% is used to pay shareholder
service fees.

The NASD rule limits the amount that a Fund may pay annually in distribution
costs for the sale of its shares and shareholder service fees. The rule limits
annual expenditures to 1% of the aggregate average daily net asset value of its
shares, of which 0.75% may be used to pay such distribution costs and 0.25% may
be used to pay shareholder service fees. The NASD rule also limits the aggregate
amount which the Fund may pay for such distribution costs to 6.25% of gross
share sales since the inception of the 12b-1 Distribution Plan, plus interest at
the prime rate plus 1% per annum on such amounts (less any contingent deferred
sales charges paid by shareholders to KDI), remaining unpaid from time to time.

KDI intends, but is not obligated, to continue to pay or accrue distribution
charges incurred in connection with the Class B Distribution Plan that exceed
current annual payments permitted to be received by KDI from the Fund. KDI
intends to seek full payment of such charges from the Portfolio (together with
annual interest thereon at the prime rate plus one percent) at such time in the
future as, and to the extent that, payment thereof by the Portfolio would be
within the permitted limits.

Each of the Distribution Plans may be terminated at any time by vote of the
Independent Trustees or by vote of a majority of the outstanding voting shares
of the respective class. After the termination of the Class B Distribution Plan,
however, KDI would be entitled to receive payment, at the annual rate of 1.00%
of the average daily net asset value of Class B shares, as compensation for its
services which had been earned at any time during which the Class B Distribution
Plan was in effect. Unreimbursed distribution expenses at September 30, 1994 for
Class B shares were $3,003,410 (2.28% of Class B net assets). Unreimbursed
distribution expenses at September 30, 1994 for Class C shares were $213,323
(0.42% of Class C net assets). Under the NASD Rule, the maximum uncollected
amounts for which KDI may seek payment from the Fund under its Distribution
Plans are $7,617,606 and $3,090,411, respectively, for Class B and Class C as of
September 30, 1994.

For the year ended September 30, 1994, the Fund paid KDI $136,945, $774,646
and $286,141 pursuant to the Class A, Class B and Class C Distribution Plans,
respectively. The Fund makes no payments in connection with the sale of its
shares other than the fee paid to its Principal Underwriter.

Dealers or others may receive different levels of compensation depending on
which class of shares they sell. Payments pursuant to a Distribution Plan are
included in the operating expenses of the class.

HOW TO REDEEM SHARES

You may redeem Portfolio shares for cash at their net asset value upon written
order to the Fund c/o KIRC, and presentation to the Portfolio of a properly
endorsed share certificate (if certificates have been issued). Your signature(s)
on the written order and certificates must be guaranteed as described below. The
redemption value is the net asset value and may be more or less than your cost
depending upon changes in the value of the Portfolio's securities between
purchase and redemption. In order to redeem by telephone you must have completed
the authorization in your account application.

The redemption value equals the net asset value per share and may be more or
less than your cost depending upon changes in the value of the Fund's portfolio
securities between purchase and redemption.

REDEMPTION OF SHARES IN GENERAL

At various times the Fund may be requested to redeem shares for which it has
not yet received good payment. In such a case, the Fund will mail the redemption
proceeds upon clearance of the purchase check, which may take up to 15 days or
more. Any delay may be avoided by purchasing shares either with a certified
check or bank wire of funds. Although the mailing of a redemption check may be
delayed, the redemption value will be determined and the redemption processed in
the ordinary course of business upon receipt of proper documentation. In such a
case, after the redemption and prior to the release of the proceeds, no
appreciation or depreciation will occur in the value of the redeemed shares and
no interest will be paid on the redemption proceeds. If the mailing of a
redemption has been delayed, the check will be mailed promptly after good
payment has been collected.

The Fund computes the redemption value at the close of the Exchange at the end
of the day on which it has received all proper documentation from you. Payment
of the amount due on redemption, less any applicable deferred sales charge, will
be made within seven days thereafter except as discussed herein.

You may also redeem your shares through broker-dealers. KDI, acting as agent
for the Fund, stands ready to repurchase Fund shares upon orders from dealers
and will calculate the net asset value on the same terms as those orders for the
purchase of shares received from broker-dealers and described under "How to Buy
Shares." If KDI has received proper documentation, it will pay the redemption
proceeds, less any applicable deferred sales charge, to the broker-dealer
placing the order within seven days thereafter. KDI charges no fees for this
service. However, your broker-dealer may charge a service fee.

For your protection, SIGNATURES ON CERTIFICATES, STOCK POWERS AND ALL WRITTEN
ORDERS OR AUTHORIZATIONS MUST BE GUARANTEED BY A U.S. STOCK EXCHANGE MEMBER, A
BANK OR OTHER PERSON ELIGIBLE TO GUARANTEE SIGNATURES UNDER THE SECURITIES
EXCHANGE ACT OF 1934 AND KIRC'S POLICIES. The Fund and KIRC may waive this
requirement, but may also require additional documents in certain cases.
Currently, the requirement for a signature guarantee has been waived on
redemptions of $50,000 or less when the account address of record has been the
same for a minimum period of 30 days. The Fund and KIRC reserve the right to
withdraw this waiver at any time.

If the Fund receives a redemption order but you have not clearly indicated the
amount of money or number of shares involved, the Fund cannot execute the order.
In such cases, the Fund will request the missing information from you and
process the order on the day such information is received.

TELEPHONE

Under ordinary circumstances, you may redeem up to $50,000 from your account
by telephone by calling toll free 1-800-343-2898. You must complete the
Telephone Redemptions section of the application to enjoy telephone redemption
privileges.

In order to insure that instructions received by KIRC are genuine when you
initiate a telephone transaction, you will be asked to verify certain criteria
specific to your account. At the conclusion of the transaction, you will be
given a transaction number confirming your request, and written confirmation of
your transaction will be mailed the next business day. Your telephone
instructions will be recorded. Redemptions by telephone are allowed only if the
address and bank account of record have been the same for a minimum period of 30
days.

If the redemption proceeds are less than $2,500, they will be mailed by check.
If they are $2,500 or more, they will be mailed, wired or sent by EFT to your
previously designated bank account as you direct. If you do not specify how you
wish your redemption proceeds to be sent, they will be mailed by check.

If you cannot reach the Fund by telephone, you should follow the procedures
for redeeming by mail or through a broker as set forth herein.

GENERAL

The Fund reserves the right at any time to terminate, suspend or change the
terms of any redemption method described in this prospectus, except redemption
by mail, and to impose fees.

Except as otherwise noted, neither the Fund, KIRC nor KDI assumes
responsibility for the authenticity of any instructions received by any of them
from a shareholder in writing, over the Keystone Automated Response Line
("KARL") or by telephone. KIRC will employ reasonable procedures to confirm that
instructions received over KARL or by telephone are genuine. Neither the Fund,
KIRC nor KDI will be liable when following instructions received over KARL or by
telephone that KIRC reasonably believes to be genuine.

The Fund may temporarily suspend the right to redeem its shares when (1) the
Exchange is closed, other than customary weekend and holiday closings; (2)
trading on the Exchange is restricted; (3) an emergency exists and the Fund
cannot dispose of its investments or fairly determine their value; or (4) the
Securities and Exchange Commission so orders.

SMALL ACCOUNTS

Because of the high cost of maintaining small accounts, the Fund reserves the
right to redeem your account if its value has fallen below $1,000, the current
minimum investment level, as a result of your redemptions (but not as a result
of market action). You will be notified in writing and allowed 60 days to
increase the value of your account to the minimum investment level. No deferred
sales charges are applied to such redemptions.

REDEMPTIONS IN KIND

If conditions arise that would make it undesirable for the Fund to pay for all
redemptions in cash, the Fund may authorize payment to be made in portfolio
securities or other property. However, the Fund has obligated itself under the
1940 Act to redeem for cash all shares of the Portfolio presented for redemption
by any one shareholder in any 90-day period up to the lesser of $250,000 or 1%
of the Portfolio's net assets. Securities delivered in payment of redemptions
would be valued at the same value assigned to them in computing the net asset
value per share. Shareholders receiving such securities would incur brokerage
costs when these securities are sold.

REDEMPTION OF CERTAIN CLASS A SHARES

Certain purchases of Class A shares in the amount of $1,000,000 or more, on
which no initial sales charge has been paid, are subject to a contingent
deferred sales charge of 0.25%. See the section entitled "Class A Shares".

SHAREHOLDER SERVICES

Details on all shareholder services may be obtained from KIRC by writing or by
calling toll free 1-800-343-2898.

KEYSTONE AUTOMATED RESPONSE LINE

KARL offers shareholders specific fund account information and price and yield
quotations as well as the ability to effect account transactions, including
investments, exchanges and redemptions. You may access KARL by dialing toll free
1-800-346-3858 on any touch tone telephone, 24 hours a day, seven days a week.

EXCHANGES

A shareholder who has obtained the appropriate prospectus, you may exchange
shares of the Portfolio for shares of certain other Keystone America Funds and
Keystone Liquid Trust ("KLT") as follows:

Class A shares may be exchanged for Class A shares of other Keystone
America Funds and Class A shares of KLT;

Class B shares may be exchanged for Class B shares of other Keystone
America Funds and Class B shares of KLT; and

Class C shares may be exchanged for Class C shares of other Keystone
America Funds and Class C shares of KLT.

The exchange of Class B shares and Class C shares will not be subject to a
contingent deferred sales charge. However, if the shares being tendered for
exchange are

(1) Class A shares where the original purchase was for $1,000,000 or more and
no sales charge was paid,

(2) Class B shares that have been held for less than four years, or

(3) Class C shares that have been held for less than one year, and are still
subject to a deferred sales charge, such charge will carry over to the shares
being acquired in the exchange transaction.

You may exchange shares for another Keystone fund for a $10 fee by calling or
writing to Keystone. The exchange fee is waived for individual investors who
make an exchange using KARL. Shares purchased by check are eligible for exchange
after 15 days. If the shares being tendered for exchange have been held for less
than four years and are still subject to a deferred sales charge, such charge
will carry over to the shares being acquired in the exchange transaction. The
Fund reserves the right to terminate this exchange offer or to change its terms,
including the right to change the service charge for any exchange.

Orders to exchange shares of the Portfolio for shares of KLT will be executed
by redeeming the shares of the Portfolio and purchasing shares of KLT at the net
asset value of KLT shares next determined after the proceeds from such
redemption become available, which may be up to seven days after such
redemption. In all other cases, orders for exchanges received by the Fund prior
to 4:00 p.m. on any day the funds are open for business will be executed at the
respective net asset values determined as of the close of business that day.
Orders for exchanges received after 4:00 p.m. on any business day will be
executed at the respective net asset values determined at the close of the next
business day.

An excessive number of exchanges may be disadvantageous to the Fund.
Therefore, the Fund, in addition to its right to reject any exchange, reserves
the right to terminate the exchange privilege of any shareholder who makes more
than five exchanges of shares of the funds in a year or three in a calendar
quarter.

An exchange order must comply with the requirements for a redemption or
repurchase order and must specify the dollar value or number of shares to be
exchanged. Exchanges are subject to the minimum initial purchase requirements of
the fund being acquired. An exchange constitutes a sale for federal income tax
purposes.

The exchange privilege is available only in states where shares of the fund
being acquired may legally be sold.

KEYSTONE AMERICA MONEY LINE

Keystone America Money Line eliminates the delay of mailing a check or the
expense of wiring funds. You must request the service on your application.
Keystone America Money Line allows you to authorize electronic transfers of
money to purchase shares in any amount and to redeem up to $50,000 worth of
shares. You can use Keystone America Money Line like an "electronic check" to
move money between your bank account and your account in the Portfolio with one
telephone call. You must allow two business days after the call for the transfer
to take place. For money recently invested, you must allow normal check clearing
time before redemption proceeds are sent to your bank.

You may also arrange for systematic monthly or quarterly investments in your
Keystone America account. Once proper authorization is given, your bank account
will be debited to purchase shares in the Portfolio. You will receive
confirmation from KDI for every transaction.

To change the amount of a Keystone America Money Line or to terminate the
service (which could take up to 30 days), you must write to KIRC and include
account numbers.

RETIREMENT PLANS

The Fund has various pension and profit-sharing plans available to investors,
including Individual Retirement Accounts ("IRAs"); Rollover IRAs; Simplified
Employee Pension Plans ("SEPs"); Tax Sheltered Annuity Plans ("TSAs"), 401(k)
Plans; Keogh Plans; Corporate Profit-Sharing Pension Plans and Target Benefit
Plans; Money Purchase Pension Plans; and Salary-Reduction Plans. For details,
including fees and application forms, call toll free 1-800-247-4075 or write to
KIRC.

AUTOMATIC WITHDRAWAL PLAN

Under an Automatic Withdrawal Plan, if your account has a value of at least
$10,000, you may arrange for regular monthly or quarterly fixed withdrawal
payments. Each payment must be at least $100 and may be as much as 1.5% per
month or 4.5% per quarter of the total net asset value of the Portfolio shares
in your account when the Automatic Withdrawal Plan is opened. Fixed withdrawal
payments are not subject to a deferred sales charge. Excessive withdrawals may
decrease or deplete the value of your account. Because of the effect of the
applicable sales charge, a Class A investor should not make continuous purchases
of the Fund's shares while participating in an Automatic Withdrawal Plan.

DOLLAR COST AVERAGING

Through dollar cost averaging you can invest a fixed dollar amount each month
or each quarter in any Keystone America Fund. This results in more shares being
purchased when the selected fund's net asset value is relatively low and fewer
shares being purchased when the fund's net asset value is relatively high, which
may cause a lower average cost per share than a less systematic investment
approach.

Prior to participating in dollar cost averaging, you must have established an
account in a Keystone America Fund or a money market fund managed or advised by
Keystone. You should designate on the application the dollar amount of each
monthly or quarterly investment (minimum $100) you wish to make and the fund in
which the investment is to be made. Thereafter, on the first day of the
designated month an amount equal to the specified monthly or quarterly
investment will automatically be redeemed from your initial account and invested
in shares of the designated fund. If you are a Class A investor and paid a sales
charge on your initial purchase, the shares purchased will be eligible for
Rights of Accumulation and the sales charge applicable to the purchase will be
determined accordingly. In addition, the value of shares purchased will be
included in the total amount required to fulfill a Letter of Intent. If a sales
charge was not paid on the initial purchase, a sales charge will be imposed at
the time of subsequent purchase and the value of shares purchased will become
eligible for Rights of Accumulation and Letters of Intent.

TWO DIMENSIONAL INVESTING

You may elect to have income and capital gains distributions from any of your
Keystone America Funds automatically invested to purchase Class A shares of any
other Keystone America Fund. You may select this service on your application and
indicate the Keystone America Fund(s) into which distributions are to be
invested. The value of shares purchased will be ineligible for Rights of
Accumulation and Letters of Intent.

OTHER SERVICES

Under certain circumstances, you may, within 30 days after a redemption,
reinstate your account at current net asset value.

PERFORMANCE DATA

From time to time, the Portfolio may advertise "total return" and "current
yield. ALL DATA IS BASED ON HISTORICAL EARNINGS AND IS NOT INTENDED TO INDICATE
FUTURE PERFORMANCE. Total return and yield are computed separately for each
class of shares of the Portfolio. Total return refers to the Portfolio's average
annual compounded rates of return over specified periods determined by comparing
the initial amount invested in a particular class to the ending redeemable value
of that amount. The resulting equation assumes reinvestment of all dividends and
distributions and deduction of the maximum sales charge or applicable contingent
deferred sales charge and all recurring charges, if any, applicable to all
shareholder accounts. The exchange fee is not included in the calculation.

Current yield quotations represent the yield on an investment for a stated
30-day period computed by dividing net investment income earned per share during
the base period by the maximum offering price per share on the last day of the
base period. The Portfolio does not presently intend to advertise current yield.

The Portfolio may also include comparative performance data for each class of
shares when advertising or marketing the Portfolio's shares, such as data from
Lipper Analytical Services, Inc., Morningstar, Inc., and Ibbotson Associations
or other industry publications, including global indexes.

FUND SHARES

The Fund currently issues three classes of shares that participate
proportionately based on their relative net asset values in dividends and
distributions and have equal voting, liquidation and other rights except that
(1) expenses related to the distribution of each class of shares or other
expenses that the Board of Trustees may designate as class expenses from time to
time, are borne solely by each class; (2) each class of shares has exclusive
voting rights with respect to its Distribution Plan; (3) each class has
different exchange privileges; and (4) each class has a different designation.
When issued and paid for, the shares will be fully paid and nonassessable by the
Fund. Shares may be exchanged as explained under "Shareholder Services", but
will have no other preference, conversion, exchange or preemptive rights. Shares
are redeemable, transferable and freely assignable as collateral. The Fund is
authorized to issue additional classes or series of shares.

Shareholders are entitled to one vote for each full share owned and fractional
votes for fractional shares. Shares of the Fund vote together except when
required by law to vote separately by class. The Fund does not have annual
meetings. The Fund will have special meetings, from time to time, as required
under its Declaration of Trust and under the 1940 Act. As provided in the Fund's
Declaration of Trust, shareholders have the right to remove Trustees by an
affirmative vote of two-thirds of the outstanding shares. A special meeting of
the shareholders will be held when 10% of the outstanding shares request a
meeting for the purpose of removing a Trustee. The Fund is prepared to assist
shareholders in communications with one another for the purpose of convening
such a meeting as prescribed by Section 16(c) of the 1940 Act.

Under Massachusetts law, it is possible that a Fund shareholder may be held
personally liable for the Fund's obligations. The Fund's Declaration of Trust
provides, however, that shareholders shall not be subject to any personal
liability for the Fund's obligations and provides indemnification from Fund
assets for any shareholder held personally liable for the Fund's obligations.
Disclaimers of such liability are included in each Fund agreement.

ADDITIONAL INFORMATION

KIRC, located at 101 Main Street, Cambridge, Massachusetts 02142-1519, is a
wholly-owned subsidiary of Keystone, serves as the Fund's transfer agent and
dividend disbursing agent.

When the Fund determines from its records that more than one account in the
Fund is registered in the name of a shareholder or shareholders having the same
address, upon notice to those shareholders, the Fund intends, when an annual
report or a semi-annual report of the Fund is required to be furnished, to mail
one copy of such report to that address.

Except as otherwise stated in this prospectus or required by law, the Fund
reserves the right to change the terms of the offer stated in this prospectus
without shareholder approval, including the right to impose or change fees for
services provided.

ADDITIONAL INVESTMENT INFORMATION

THE GLOBAL OPPORTUNITIES PORTFOLIO

The Portfolio may engage in the following investment practices to the extent
described in the prospectus and the statement of additional information.

OBLIGATIONS OF FOREIGN BRANCHES OF UNITED STATES BANKS

The obligations of foreign branches of U.S. banks may be general obligations
of the parent bank in addition to the issuing branch or may be limited by the
terms of a specific obligation and by government regulation. Payment of interest
and principal upon these obligations also may be affected by governmental action
in the country of domicile of the branch (generally referred to as sovereign
risk). In addition, evidences of ownership of such securities may be held
outside the U.S. and the Portfolio may be subject to the risks associated with
the holding of such property overseas. Various provisions of federal law
governing domestic branches do not apply to foreign branches of domestic banks.

OBLIGATIONS OF UNITED STATES BRANCHES OF FOREIGN BANKS

Obligations of U.S. branches of foreign banks may be general obligations of
the parent bank in addition to the issuing branch or may be limited by the terms
of a specific obligation and by federal and state regulation as well as by
governmental action in the country in which the foreign bank has its head
office. In addition, there may be less publicly available information about a
U.S. branch of a foreign bank than about a domestic bank.

TIME DEPOSITS

The Portfolio may acquire time deposits or obligations issued by international
agencies, such as the International Bank for Reconstruction and Development, the
Asian Development Bank or the Inter-American Bank. Additionally, the Portfolio
may purchase certificates of deposit, bankers' acceptances, time deposits or
other similar obligations issued by foreign banks.

MASTER DEMAND NOTES

Master demand notes are unsecured obligations that permit the investment of
fluctuating amounts by the Portfolio at varying rates of interest pursuant to
direct arrangements between the Portfolio, as lender, and the issuer, as
borrower. Master demand notes may permit daily fluctuations in the interest rate
and daily changes in the amounts borrowed. The Portfolio has the right to
increase the amount under the note at any time up to the full amount provided by
the note agreement or to decrease the amount, and the borrower may repay up to
the full amount of the note without penalty. Notes purchased by the Portfolio
permit the Portfolio to demand payment of principal and accrued interest at any
time (on not more than seven days' notice). Notes acquired by the Portfolio may
have maturities of more than one year, provided (1) the Portfolio is entitled to
payment of principal and accrued interest upon not more than seven days' notice,
and (2) the rate of interest on such notes is adjusted automatically at periodic
intervals which normally will not exceed 31 days, but may extend up to one year.
The notes are deemed to have a maturity equal to the longer of the period
remaining to the next interest rate adjustment or the demand notice period.
Because these types of notes are direct lending arrangements between the lender
and the borrower, such instruments are not normally traded and there is no
secondary market for these notes, although they are repayable by the borrower at
face value plus accrued interest at any time. Accordingly, the Portfolio's right
to redeem is dependent on the ability of the borrower to pay principal and
interest on demand. In connection with master demand note arrangements, Keystone
considers, under standards established by the Board of Trustees, earning power,
cash flow and other liquidity ratios of the borrower and will monitor the
ability of the borrower to pay principal and interest on demand. These notes are
not typically rated by credit rating agencies. Unless rated, the Portfolio will
invest in them only if the issuer meets the criteria established for commercial
paper.

REPURCHASE AGREEMENTS

The Portfolio may enter into repurchase agreements; i.e., the Portfolio
purchases a security subject to the Fund's obligation to resell and the seller's
obligation to repurchase that security at an agreed upon price and date, such
date usually being not more than seven days from the date of purchase. The
resale price is based on the purchase price plus an agreed upon current market
rate of interest that (for purposes of the transaction) is generally unrelated
to the coupon rate or maturity of the purchased security. A repurchase agreement
imposes an obligation on the seller to pay the agreed upon price, which
obligation is in effect secured by the value of the underlying security. The
value of the underlying security is at least equal to the amount of the agreed
upon resale price and marked to market daily to cover such amount. The Portfolio
may enter into such agreements only with respect to U.S. government and foreign
government securities, which may be denominated in U.S. or foreign currencies.
The Portfolio may enter into such repurchase agreements with foreign banks and
securities dealers approved in advance by the Fund's Trustees. Whether a
repurchase agreement is the purchase and sale of a security or a collateralized
loan has not been definitively established. This might become an issue in the
event of the bankruptcy of the other party to the transaction. It does not
presently appear possible to eliminate all risks involved in repurchase
agreements. These risks include the possibility of an increase in the market
value of the underlying securities or inability of the repurchaser to perform
its obligation to repurchase coupled with an uncovered decline in the market
value of the collateral, including the underlying securities, as well as delay
and costs to the Portfolio in connection with enforcement or bankruptcy
proceedings. Therefore, it is the policy of the Portfolio to enter into
repurchase agreements only with large, well-capitalized banks that are members
of the Federal Reserve System and with primary dealers in U.S. government
securities (as designated by the Federal Reserve Board) whose creditworthiness
has been reviewed and found satisfactory by the Portfolio's advisers.

REVERSE REPURCHASE AGREEMENTS

Under a reverse repurchase agreement, the Portfolio would sell securities and
agree to repurchase them at a mutually agreed upon date and price. The Portfolio
intends to enter into reverse repurchase agreements to avoid otherwise having to
sell securities during unfavorable market conditions in order to meet
redemptions. At the time the Portfolio enters into a reverse repurchase
agreement, it will establish a segregated account with the Portfolio's custodian
containing liquid assets having a value not less than the repurchase price
(including accrued interest) and will subsequently monitor the account to ensure
such value is maintained. Reverse repurchase agreements involve the risk that
the market value of the securities which the Portfolio is obligated to
repurchase may decline below the repurchase price. Borrowing and reverse
repurchase agreements magnify the potential for gain or loss on the securities
of the Portfolio and, therefore, increase the possibility of fluctuation in the
Portfolio's net asset value. Such practice may constitute leverage. In the event
the buyer of securities under a reverse repurchase agreement files for
bankruptcy or becomes insolvent, such buyer or its trustee or receiver may
receive an extension of time to determine whether to enforce the Portfolio's
obligation to repurchase the securities and the Portfolio's use of the proceeds
of the reverse repurchase agreement may effectively be restricted pending such
determination. The staff of the SEC has taken the position that the Investment
Company Act of 1940 treats reverse repurchase agreements as being included in
the percentage limit on borrowings imposed on a Fund.

FOREIGN SECURITIES

The Portfolio may invest its assets in securities principally traded in
securities markets outside the U.S. While investment in foreign securities is
intended to reduce risk by providing further diversification, such investments
involve sovereign risk in addition to the credit and market risks normally
associated with domestic securities. Foreign investments may be affected
favorably or unfavorably by changes in currency rates and exchange control
regulations. There may be less publicly available information about a foreign
company, particularly emerging market country companies, than about a U.S.
company, and foreign companies may not be subject to accounting, auditing and
financial reporting standards and requirements comparable to those applicable to
U.S. companies. Securities of some foreign companies are less liquid or more
volatile than securities of U.S. companies, and foreign brokerage commissions
and custodian fees are generally higher than in the U.S. Investments in foreign
securities may also be subject to other risks different from those affecting
U.S. investments, including local political or economic developments,
particularly with respect to companies in the formerly communist countries of
Eastern Europe and the People's Republic of China, expropriation or
nationalization of assets, imposition of withholding taxes on dividend or
interest payments and currency blockage (which would prevent cash from being
brought back to the U.S.).

"WHEN ISSUED" SECURITIES

The Portfolio may also purchase and sell securities or currencies on a when
issued and delayed delivery basis. When issued and delayed delivery transactions
arise when securities or currencies are purchased or sold by the Portfolio with
payment and delivery taking place in the future in order to secure what is
considered to be an advantageous price and yield to the Portfolio at the time of
entering into the transaction. When the Portfolio engages in when issued and
delayed delivery transactions, the Portfolio relies on the buyer or seller, as
the case may be, to consummate the sale. Failure to do so may result in the
Portfolio missing the opportunity to obtain a price or yield considered to be
advantageous. When issued and delayed delivery transactions may be expected to
occur a month or more before delivery is due. No payment or delivery is made by
the Fund however, until it receives payment or delivery from the other party to
the transaction. The Fund will maintain a separate account of liquid assets
equal to the value of such commitments will be maintained until payment is made.
When issued and delayed delivery agreements are subject to risks from changes in
value based upon changes in the level of interest rates and other market
factors, both before and after delivery. The Portfolio does not accrue any
income on such securities prior to their delivery. To the extent the Portfolio
engages in when issued and delayed delivery transactions, it will do so for the
purposes consistent with its investment objective and policies and not for the
purpose of investment leverage.

LOANS OF SECURITIES TO BROKER-DEALERS

The Portfolio may lend securities to brokers and dealers pursuant to
agreements requiring that the loans be continuously secured by cash, or
securities of the U.S. government, its agencies or instrumentalities or any
combination of cash and such securities, as collateral equal at all times in
value to at least the market value of the securities loaned. Such securities
loans will not be made with respect to the Portfolio if as a result the
aggregate of all outstanding securities loans exceeds 15% of the value of the
Portfolio's total assets taken at their current value. The Portfolio continues
to receive interest or dividends on the securities loaned and simultaneously
earns interest on the investment of the cash loan collateral in U.S. Treasury
notes, certificates of deposit, other high-grade, short-term obligations or
interest bearing cash equivalents. Although voting rights attendant to
securities loaned pass to the borrower, such loans may be called at any time and
will be called so that the securities may be voted by the Portfolio if, in the
opinion of the Portfolio, a material event affecting the investment is to occur.
There may be risks of delay in receiving additional collateral or in recovering
the securities loaned or even loss of rights in the collateral should the
borrower of the securities fail financially. Loans may only be made, however, to
borrowers deemed to be of good standing, under standards approved by the Board
of Trustees, when the income to be earned from the loan justifies the attendant
risks.

DERIVATIVES

The Portfolio may use derivatives in furtherance of its investment objective.
Derivatives are financial contracts whose value depends on, or is derived from,
the value of an underlying asset, reference rate or index. These assets, rates
and indices may include bonds, stocks, mortgages, commodities, interest rates,
currency exchange rates, bond indices and stock indices. Derivatives can be used
to earn income or protect against risk, or both. For example, one party with
unwanted risk may agree to pass that risk to another party who is willing to
accept the risk, the second party being motivated, for example by the desire
either to earn income in the form of a fee or premium from the first party, or
to reduce its own unwanted risk by attempting to pass all or part of that risk
to the first party.

Derivatives can be used by investors such as the Portfolio to earn income and
enhance returns, to hedge or adjust the risk profile of the portfolio, and
either in place of more traditional direct investments or to obtain exposure to
otherwise inaccessible markets. The Portfolio is permitted to use derivatives
for one or more of these purposes, although the Portfolio generally uses
derivatives primarily as direct investments in order to enhance yields and
broaden portfolio diversification. Each of these uses entails greater risk than
if derivatives were used solely for hedging purposes. The Portfolio uses futures
contracts and related options for hedging purposes. Derivatives are a valuable
tool which, when used properly, can provide significant benefit to Portfolio
shareholders. Keystone is not an aggressive user of derivatives with respect to
the Portfolio. However, the Portfolio may take positions in those derivatives
that are within its investment policies if, in Keystone's judgement, this
represents an effective response to current or anticipated market conditions.
Keystone's use of derivatives is subject to continuous risk assessment and
control from the standpoint of the Portfolio's investment objectives and
policies.

Derivatives may be (1) standardized, exchange-traded contracts or (2)
customized, privately negotiated contracts. Exchange-traded derivatives tend to
be more liquid and subject to less credit risk than those that are privately
negotiated.

There are four principal types of derivative instruments -- options, futures,
forwards and swaps -- from which virtually any type of derivative transaction
can be created. Further information regarding options and futures is provided
later in this section and is provided in the Portfolio's statement of additional
information. The Portfolio does not presently engage in the use of swaps.

While the judicious use of derivatives by experienced investment managers such
as Keystone can be beneficial, derivatives also involve risks different from,
and, in certain cases, greater than, the risks presented by more traditional
investments.

Following is a general discussion of important risk factors and issues
concerning the use of derivatives that investors should understand before
investing in the Portfolio.

* Market Risk -- This is the general risk attendant to all investments that the
value of a particular investment will decline or otherwise change in a way
detrimental to the Portfolio's interest.

* Management Risk -- Derivative products are highly specialized instruments that
require investment techniques and risk analyses different from those
associated with stocks and bonds. The use of a derivative requires an
understanding not only of the underlying instrument, but also of the
derivative itself, without the benefit of observing the performance of the
derivative under all possible market conditions. In particular, the use and
complexity of derivatives require the maintenance of adequate controls to
monitor the transactions entered into, the ability to assess the risk that a
derivative adds to the Portfolio's portfolio and the ability to forecast
price, interest rate or currency exchange rate movements correctly.

* Credit Risk -- This is the risk that a loss may be sustained by the Portfolio
as a result of the failure of another party to a derivative (usually referred
to as a "counterparty") to comply with the terms of the derivative contract.
The credit risk for exchange traded derivatives is generally less than for
privately negotiated derivatives, since the clearing house, which is the
issuer or counterparty to each exchange-traded derivative, provides a
guarantee of performance. This guarantee is supported by a daily payment
system (i.e., margin requirements) operated by the clearing house in order to
reduce overall credit risk. For privately negotiated derivatives, there is no
similar clearing agency guarantee. Therefore, the Portfolio considers the
creditworthiness of each counterparty to a privately negotiated derivative in
evaluating potential credit risk.

* Liquidity Risk -- Liquidity risk exists when a particular instrument is
difficult to purchase or sell. If a derivative transaction is particularly
large or if the relevant market is illiquid (as is the case with many
privately negotiated derivatives), it may not be possible to initiate a
transaction or liquidate a position at an advantageous price.

* Leverage Risk -- Since many derivatives have a leverage component, adverse
changes in the value or level of the underlying asset, rate or index can
result in a loss substantially greater than the amount invested in the
derivative itself. In the case of swaps, the risk of loss generally is related
to a notional principal amount, even if the parties have not made any initial
investment. Certain derivatives have the potential for unlimited loss,
regardless of the size of the initial investment.

* Other Risk -- Other risks in using derivatives include the risk of mispricing
or improper valuation and the inability of derivatives to correlate perfectly
with underlying assets, rates and indices. Many derivatives; in particular,
privately negotiated derivatives, are complex and often valued subjectively.
Improper valuations can result in increased cash payment requirements to
counterparties or a loss of value to a Portfolio. Derivatives do not always
perfectly or even highly correlate or track the value of the assets, rates or
indices they are designed to closely track. Consequently, the Portfolio's use
of derivatives may not always be an effective means of, and sometimes could be
counterproductive to, furthering the Fund's investment objective.

OPTIONS TRANSACTIONS

WRITING COVERED OPTIONS. The Portfolio may write (i.e., sell) covered call and
put options. By writing a call option, the Portfolio becomes obligated during
the term of the option to deliver the securities underlying the option upon
payment of the exercise price. By writing a put option, the Portfolio becomes
obligated during the term of the option to purchase the securities underlying
the option at the exercise price if the option is exercised. The Portfolio also
may write straddles (combinations of covered puts and calls on the same
underlying security).

The Portfolio may only write "covered" options. This means that so long as the
Portfolio is obligated as the writer of a call option, it will own the
underlying securities subject to the option or, in the case of call options on
U.S. Treasury bills, the Portfolio might own substantially similar U.S. Treasury
bills. If the Portfolio has written options against all of its securities that
are available for writing options, the Portfolio may be unable to write
additional options unless it sells a portion of its portfolio holdings to obtain
new securities against which it can write options. If this were to occur, higher
portfolio turnover and correspondingly greater brokerage commissions and other
transaction costs may result. The Portfolio does not expect, however, that this
will occur.

The Portfolio will be considered "covered" with respect to a put option it
writes if, so long as it is obligated as the writer of the put option, it
deposits and maintains with its custodian in a segregated account liquid assets
having a value equal to or greater than the exercise price of the option.

The principal reason for writing call or put options is to obtain, through a
receipt of premiums, a greater current return than would be realized on the
underlying securities alone. The Portfolio receives a premium from writing a
call or put option which it retains whether or not the option is exercised. By
writing a call option, the Portfolio might lose the potential for gain on the
underlying security while the option is open, and by writing a put option, the
Portfolio might become obligated to purchase the underlying security for more
than its current market price upon exercise.

PURCHASING OPTIONS

The Portfolio may purchase put or call options for the purpose of offsetting
previously written put or call options of the same series.

If the Portfolio is unable to effect a closing purchase transaction with
respect to covered options it has written, the Portfolio will not be able to
sell the underlying securities or dispose of assets held in a segregated account
until the options expire or are exercised.

An option position may be closed out only in a secondary market for an option
of the same series. Although the Portfolio generally will write only those
options for which there appears to be an active secondary market, there is no
assurance that a liquid secondary market will exist for any particular option at
any particular time, and for some options no secondary market may exist. In such
event it might not be possible to effect a closing transaction in a particular
option.

Options on some securities are relatively new and it is impossible to predict
the amount of trading interest that will exist in such options. There can be no
assurance that viable markets will develop or continue. The failure of such
markets to develop or continue could significantly impair the Portfolio's
ability to use such options to achieve its investment objective.

OPTIONS TRADING MARKETS. Options which the Portfolio will trade are generally
listed on national securities exchanges. Exchanges on which such options
currently are traded, include the Chicago Board Options Exchange and the New
York, American, Pacific and Philadelphia Stock Exchanges. Options on some
securities may not be listed on any Exchange but traded in the over-the-counter
market. Options traded in the over-the-counter market involve the additional
risk that securities dealers participating in such transactions could fail to
meet their obligations to the Portfolio. The use of options traded in the
over-the-counter market may be subject to limitations imposed by certain state
securities authorities. In addition to the limits on its use of options
discussed herein, the Portfolio is subject to the investment restrictions
described in this prospectus and the statement of additional information.

The staff of the SEC is of the view that the premiums which the Fund pays for
the purchase of unlisted options and the value of securities used to cover
unlisted options written by the Fund are considered to be invested in illiquid
securities or assets for the purpose of calculating whether the Fund is in
compliance with its fundamental investment restriction relating to illiquid
securities.

FUTURES TRANSACTIONS

The Portfolio may enter into currency and other financial futures contracts
and write options on such contracts. The Portfolio intends to enter into such
contracts and related options for hedging purposes. The Portfolio will enter
into futures for securities, currencies or index-based futures contracts in
order to hedge against changes in interest or exchange rates or securities
prices. A futures contract on securities or currencies is an agreement to buy or
sell securities or currencies at a specified price during a designated month. A
futures contract on a securities index does not involve the actual delivery of
securities, but merely requires the payment of a cash settlement based on
changes in the securities index. The Portfolio does not make payment or deliver
securities upon entering into a futures contract. Instead, it puts down a margin
deposit, which is adjusted to reflect changes in the value of the contract and
which remains in effect until the contract is terminated.

The Portfolio may sell or purchase currency and other financial futures
contracts. When a futures contract is sold by the Portfolio, the value of the
contract will tend to rise when the value of the underlying securities or
currencies declines and to fall when the value of such securities or currencies
increases. Thus, the Portfolio sells futures contracts in order to offset a
possible decline in the value of its securities or currencies. If a futures
contract is purchased by the Portfolio, the value of the contract will tend to
rise when the value of the underlying securities or currencies increases and to
fall when the value of such securities or currencies declines. The Portfolio
intends to purchase futures contracts in order to fix what is believed by
Keystone to be a favorable price and rate of return for securities or favorable
exchange rate for currencies the Portfolio intends to purchase.

The Portfolio also intends to purchase put and call options on currency and
other financial futures contracts for hedging purposes. A put option purchased
by the Portfolio would give it the right to assume a position as the seller of a
futures contract. A call option purchased by the Portfolio would give it the
right to assume a position as the purchaser of a futures contract. The purchase
of an option on a futures contract requires the Portfolio to pay a premium. In
exchange for the premium, the Portfolio becomes entitled to exercise the
benefits, if any, provided by the futures contract, but is not required to take
any action under the contract. If the option cannot be exercised profitably
before it expires, the Portfolio's loss will be limited to the amount of the
premium and any transaction costs.

The Portfolio may enter into closing purchase and sale transactions in order
to terminate a futures contract and may sell put and call options for the
purpose of closing out its options positions. The Portfolio's ability to enter
into closing transactions depends on the development and maintenance of a liquid
secondary market. There is no assurance that a liquid secondary market will
exist for any particular contract or at any particular time. As a result, there
can be no assurance that the Portfolio will be able to enter into an offsetting
transaction with respect to a particular contract at a particular time. If the
Portfolio is not able to enter into an offsetting transaction, the Portfolio
will continue to be required to maintain the margin deposits on the contract and
to complete the contract according to its terms, in which case it would continue
to bear market risk on the transaction.

Although futures and options transactions are intended to enable the Portfolio
to manage market, interest rate or exchange rate risk, unanticipated changes in
interest rates, exchange rates or market prices could result in poorer
performance than if it had not entered into these transactions. Even if Keystone
correctly predicts interest or exchange rate movements, a hedge could be
unsuccessful if changes in the value of the Portfolio's futures position did not
correspond to changes in the value of its investments. This lack of correlation
between the Portfolio's futures and securities or currencies positions may be
caused by differences between the futures and securities or currencies markets
or by differences between the securities or currencies underlying the
Portfolio's futures position and the securities or currencies held by or to be
purchased for the Portfolio. In addition, futures contracts transactions involve
the remote risk that a party participating in a transaction will not be able to
fulfill its obligations and the amount of the obligation will exceed the ability
of the clearing broker to satisfy. Keystone will attempt to minimize these risks
through careful selection and monitoring of the Portfolio's futures and options
positions.

The Portfolio does not intend to use futures transactions for speculation or
leverage. The Portfolio has the ability to write options on futures, but intends
to write such options only to close out options purchased by the Portfolio. The
Portfolio will not change these policies without supplementing the information
in its prospectus and statement of additional information.

FOREIGN CURRENCY TRANSACTIONS

As discussed above, the Portfolio may invest in securities of foreign issuers.
When the Portfolio invests in foreign securities they usually will be
denominated in foreign currencies, and the Portfolio temporarily may hold funds
in foreign currencies. Thus, the value of Portfolio shares will be affected by
changes in exchange rates.

As one way of managing exchange rate risk, in addition to entering into
currency futures contracts, the Portfolio may enter into forward currency
exchange contracts (agreements to purchase or sell currencies at a specified
price and date). The exchange rate for the transaction (the amount of currency
the Portfolio will deliver and receive when the contract is completed) is fixed
when the Portfolio enters into the contract. The Portfolio usually will enter
into these contracts to stabilize the U.S. dollar value of a security it has
agreed to buy or sell. The Portfolio intends to use these contracts to hedge the
U.S. dollar value of a security it already owns, particularly if the Portfolio
expects a decrease in the value of the currency in which the foreign security is
denominated. Although the Portfolio will attempt to benefit from using forward
contracts, the success of its hedging strategy will depend on Keystone's ability
to predict accurately the future exchange rates between foreign currencies and
the U.S. dollar. The value of the Portfolio's investments denominated in foreign
currencies will depend on the relative strength of those currencies and the U.S.
dollar, and the Portfolio may be affected favorably or unfavorably by changes in
the exchange rate or exchange control regulations between foreign currencies and
the dollar. Changes in foreign currency exchange rates also may affect the value
of dividends and interest earned, gains and losses realized on the sale of
securities and net investment income and gains, if any, to be distributed to
shareholders by the Portfolio. The Portfolio may also purchase and sell options
related to foreign currencies in connection with hedging strategies.

<PAGE>
EXHIBIT A
REDUCED SALES CHARGES

Initial sales charges may be reduced or eliminated for persons or
organizations purchasing Class A shares of the Fund alone or in combination with
Class A shares of other Keystone America Funds.

For purposes of qualifying for reduced sales charges on purchases made
pursuant to Rights of Accumulation or Letters of Intent, the term "Purchaser"
includes the following persons: an individual; an individual, his or her spouse
and children under the age of 21; a trustee or other fiduciary of a single trust
estate or single fiduciary account established for their benefit; an
organization exempt from federal income tax under Section 501 (c)(3) or (13) of
the Internal Revenue Code; a pension, profit-sharing or other employee benefit
plan whether or not qualified under Section 401 of the Internal Revenue Code; or
other organized groups of persons, whether incorporated or not, provided the
organization has been in existence for at least six months and has some purpose
other than the purchase of redeemable securities of a registered investment
company at a discount. In order to qualify for a lower sales charge, all orders
from an organized group will have to be placed through a single investment
dealer or other firm and identified as originating from a qualifying purchaser.

CONCURRENT PURCHASES

For purposes of qualifying for a reduced sales charge, a Purchaser may combine
concurrent direct purchases of Class A shares of two or more of the "Eligible
Funds," as defined below. For example, if a Purchaser concurrently invested
$75,000 in one of the other "Eligible Funds" and $75,000 in the Fund, the sales
charge would be that applicable to a $150,000 purchase, i.e., 3.75% of the
offering price, as indicated in the Sales Charge Schedule in the prospectus.

RIGHT OF ACCUMULATION

In calculating the sales charge applicable to current purchases of the Fund's
Class A shares, a Purchaser is entitled to accumulate current purchases with the
current value of previously purchased Class A shares of the Fund and Class A
shares of certain other eligible funds that are still held in (or exchanged for
shares of and are still held in) the same or another eligible fund ("Eligible
Fund(s)"). The Eligible Funds are the Keystone America Funds and Keystone Liquid
Trust.

For example, if a Purchaser held shares valued at $99,999 and purchased an
additional $5,000, the sales charge for the $5,000 purchase would be at the next
lower sales charge of 4.75% of the offering price as indicated in the Sales
Charge schedule. KIRC must be notified at the time of purchase that the
Purchaser is entitled to a reduced sales charge, which reduction will be granted
subject to confirmation of the Purchaser's holdings. The Right of Accumulation
may be modified or discontinued at any time.

LETTER OF INTENT

A Purchaser may qualify for a reduced sales charge on a purchase of Class A
shares of the Fund alone or in combination with purchases of Class A shares of
any of the other Eligible Funds by completing the Letter of Intent section of
the application. By so doing, the Purchaser agrees to invest within a
thirteen-month period a specified amount which, if invested at one time, would
qualify for a reduced sales charge. Each purchase will be made at a public
offering price applicable to a single transaction of the dollar amount specified
on the application, as described in this prospectus. The Letter of Intent does
not obligate the Purchaser to purchase, nor the Fund to sell, the amount
indicated.

After the Letter of Intent is received by KIRC, each investment made will be
entitled to the sales charge applicable to the level of investment indicated on
the application. The Letter of Intent may be back-dated up to ninety days so
that any investments made in any of the Eligible Funds during the preceding
ninety-day period, valued at the Purchaser's cost, can be applied toward
fulfillment of the Letter of Intent. However, there will be no refund of sales
charges already paid during the ninety-day period. No retroactive adjustment
will be made if purchases exceed the amount specified in the Letter of Intent.
Income and capital gains distributions taken in additional shares will not apply
toward completion of the Letter of Intent.

If total purchases made pursuant to the Letter of Intent are less than the
amount specified, the Purchaser will be required to remit an amount equal to the
difference between the sales charge paid and the sales charge applicable to
purchases actually made. Out of the initial purchase (or subsequent purchases,
if necessary) 5% of the dollar amount specified on the application will be held
in escrow by KIRC in the form of shares registered in the Purchaser's name. The
escrowed shares will not be available for redemption, transfer or encumbrance by
the Purchaser until the Letter of Intent is completed or the higher sales charge
paid. All income and capital gains distributions on escrowed shares will be paid
to the Purchaser or his order.

When the minimum investment specified in the Letter of Intent is completed
(either prior to or by the end of the thirteen-month period), the Purchaser will
be notified and the escrowed shares will be released. If the intended investment
is not completed, the Purchaser will be asked to remit to KDI any difference
between the sales charge on the amount specified and on the amount actually
attained. If the Purchaser does not within 20 days after written request by KDI
or his dealer pay such difference in sales charge, KIRC will redeem an
appropriate number of the escrowed shares in order to realize such difference.
Shares remaining after any such redemption will be released by KIRC. Any
redemptions made by the Purchaser during the thirteen-month period will be
subtracted from the amount of the purchases for purposes of determining whether
the Letter of Intent has been completed. In the event of a total redemption of
the account prior to completion of the Letter of Intent, the additional sales
charge due will be deducted from the proceeds of the redemption and the balance
will be forwarded to the Purchaser.

By signing the application, the Purchaser irrevocably constitutes and appoints
KIRC his attorney to surrender for redemption any or all escrowed shares with
full power of substitution.

The Purchaser or his dealer must inform KDI or KIRC that a Letter of Intent is
in effect each time a purchase is made.

<PAGE>
KEYSTONE AMERICA
FAMILY OF FUNDS
[Logo]
Capital Preservation and Income Fund
Government Securities Fund
Intermediate Term Bond Fund
Strategic Income fund
World Bond Fund
Tax Free Income Fund
California Insured Tax Free Fund
Florida Tax Free Fund
Massachusetts Tax Free Fund
Missouri Tax Free Fund
New York Insured Tax Free Fund
Pennsylvania Tax Free Fund
Texas Tax Free Fund
Fund for Total Return
Global Opportunities Fund
Hartwell Emergin Growth Fund, Inc.
Hartwell Growth Fund, Inc.
Omega Fund, Inc.
Fund of the Americas
Strategic Development Fund

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