<PAGE>
Supplement dated December 20, 2000 to the
Prospectus for Class A, Class B and Class C Shares
dated May 1, 2000 of Flag Investors
Short-Intermediate Income Fund, Inc.
The following paragraph replaces the first paragraph in the section
entitled "Investment Advisor and Sub-Advisor - Portfolio Managers" on page 9:
"M. Elliott Randolph, Jr., Paul D. Corbin and Ellen D. Harvey share
primary responsibility for managing the Fund's assets. Messrs. Randolph and
Corbin have shared responsibility for managing the Fund since its inception in
1991; Ms. Harvey joined them as a co-manager on December 20, 2000."
The following paragraph should be added as the last paragraph in the
section entitled "Investment Advisor and Sub-Advisor - Portfolio Managers" on
page 9:
"Ms. Harvey has 16 years of investment experience. She is a Partner at
Brown Trust responsible for the fixed income effort. From January 1996 to
January 2000, Ms. Harvey served as Fixed Income Portfolio Manager and principal
at Morgan Stanley Dean Witter Investment Management. She served as Fixed Income
Portfolio Manager for Miller Anderson & Sherrerd from October 1984 to January
1996 and was a partner from January 1989 to January 1996."
SUPPSI
<PAGE>
Supplement dated December 20, 2000 to
the Prospectus for Institutional Shares
dated May 1, 2000 of Flag Investors
Short-Intermediate Income Fund, Inc.
The following paragraph replaces the first paragraph in the section
entitled "Investment Advisor and Sub-Advisor - Portfolio Managers" on page 6:
"M. Elliott Randolph, Jr., Paul D. Corbin and Ellen D. Harvey share
primary responsibility for managing the Fund's assets. Messrs. Randolph and
Corbin have shared responsibility for managing the Fund since its inception in
1991; Ms. Harvey joined them as a co-manager on December 20, 2000."
The following paragraph should be added as the last paragraph in the
section entitled "Investment Advisor and Sub-Advisor - Portfolio Managers" on
page 6:
"Ms. Harvey has 16 years of investment experience. She is a Partner at
Brown Trust responsible for the fixed income effort. From January 1996 to
January 2000, Ms. Harvey served as Fixed Income Portfolio Manager and principal
at Morgan Stanley Dean Witter Investment Management. She served as Fixed Income
Portfolio Manager for Miller Anderson & Sherrerd from October 1984 to January
1996 and was a partner from January 1989 to January 1996."
SUPPINSTSI
