PIONEER MICRO CAP FUND, 485BPOS, 2000-03-29

PIONEER MICRO CAP FUND
485BPOS, 2000-03-29

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File Nos. 333-18639
811-07985

As filed with the Securities and Exchange Commission on March 29, 2000

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
---

Pre-Effective Amendment No. __ /___/

Post-Effective Amendment No. 6 / X /
---

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 / X /
---

Amendment No. 7 / X /
---

(Check appropriate box or boxes)

PIONEER MICRO-CAP FUND
(Exact Name of Registrant as Specified in Charter)

60 State Street, Boston, Massachusetts 02109
(Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code: (617) 742-7825

Joseph P. Barri, Hale and Dorr LLP, 60 State Street, Boston, Massachusetts 02109
(Name and Address of Agent for Service)

It is proposed that this filing will become effective (check appropriate box):

X immediately upon filing pursuant to paragraph (b)
---
___ on [date] pursuant to paragraph (b)
___ 60 days after filing pursuant to paragraph (a)(1)
___ on [date] pursuant to paragraph (a)(1)
___ 75 days after filing pursuant to paragraph (a)(2)
___ on [date] pursuant to paragraph (a)(2)of Rule 485.

If appropriate, check the following box:

____ This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.

<PAGE>

March 29, 2000

SUPPLEMENT TO THE PROSPECTUS OF
PIONEER MICRO-CAP FUND
DATED MARCH 29, 2000

Prospective investors should be aware that the fund may close to new
investors if Pioneer Investment Management determines that such action is
advisable in order to minimize the impact of new investments on the fund's
investment strategy. Effective March 1, 2000, Pioneer intends to temporarily
close the fund to new accounts after the end of the 15th calendar day after the
fund reaches $225 million of total assets. Previously, the fund's policy had
been to close the fund to new accounts after the net assets of the fund exceeded
$150 million. During any period when the fund's net assets exceed $225 million,
the fund will not accept new accounts until Pioneer determines that it will be
able to invest such assets in accordance with the fund's investment objective
and policies. While otherwise closed to new investments, the fund may permit (i)
shareholders of record to make additional investments to an existing account,
(ii) purchases by certain employer-sponsored retirement plans and (iii)
transfers of assets in connection with re-registration. Pioneer may amend this
policy at any time. As of March 1, 2000, the net assets of the fund were
approximately $145 million.

8257-00-0300
(C) Pioneer Funds Distributor, Inc.
Underwriter of Pioneer mutual funds
<PAGE>

[logo]

P i o n e e r

Micro-Cap Fund
- --------------------------------------------------------------------------------
CLASS A AND CLASS B SHARES

Prospectus, March 29, 2000

Contents

Basic information about the fund 1

Management 6

Buying, exchanging and selling shares 7

Dividends, capital gains and taxes 24

Financial highlights 25

Neither the Securities and Exchange Commission nor any state securities agency
has approved the fund's shares or determined whether this prospectus is
accurate or complete. Any representation to the contrary is a crime.
<PAGE>

Basic information about the fund

Investment objective

Capital growth by investing in a diversified portfolio of securities consisting
primarily of common stocks.

[sidebar]
[magnifying glass graphic]

Market value
A company's market value or capitalization
is calculated by multiplying the number
of its outstanding shares by the current
market price of a share.

[end sidebar]

Principal investment strategies
The fund invests primarily in common stocks of micro-cap companies, that is
companies with market values of $500 million or less at the time of investment.
Normally, the fund invests at least 80% of its total assets in these securities.
The fund may continue to hold securities of any company if its market value
exceeds $500 million. The fund considers securities that trade like common
stocks, such as convertible debt, depositary receipts, warrants, interests in
real estate investment trusts (REITs) and preferred stocks, to be common stocks.

Pioneer Investment Management, Inc., the fund's investment adviser, uses a
value approach to select the fund's investments. Using this investment style,
Pioneer seeks securities selling at substantial discounts to their underlying
values and then holds these securities until the market values reflect their
intrinsic values. Pioneer evaluates a security's potential value, including the
attractiveness of its market valuation, based on the company's assets and
prospects for earnings growth. In making that assessment, Pioneer employs due
diligence and fundamental research, an evaluation of the issuer based on its
financial statements and operations, employing a bottom-up analytic style.
Pioneer relies on the knowledge, experience and judgment of its staff who have
access to a wide variety of research. Pioneer focuses on the quality and price
of individual issuers, not on economic sector or market-timing strategies.
Factors Pioneer looks for in selecting investments include:
o Favorable expected returns relative to perceived risk
o Management with demonstrated ability and commitment to the company
o Above average potential for earnings and revenue growth
o Low market valuations relative to earnings forecast, book value, cash flow
and sales
o Turnaround potential for companies that have been through difficult periods
o Low debt levels relative to equity

o Issuer's industry has strong fundamentals, such as increasing or sustainable
demand and barriers to technological change or increased competition

Principal risks of investing in the fund
Even though the fund seeks capital growth, you could lose money on your
investment or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o Micro-cap or value stocks fall out of favor with investors
o The fund's assets remain undervalued or do not have the potential value
originally expected

The fund also has risks associated with investing in micro-cap companies.
Compared to large or small companies, micro-cap companies, and the market for
their common stocks, are likely to:
o Be more sensitive to changes in the economy, earnings results and investor
expectations
o Have more limited product lines and capital resources
o Experience sharper swings in market values
o Be harder to sell at the times and prices Pioneer thinks appropriate
o Offer greater potential for gain and loss

- --------------------------------------------------------------------------------
An investment in the fund is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
Contact your investment professional to discuss how the fund fits into
your portfolio.
- --------------------------------------------------------------------------------

1
<PAGE>

The fund's past performance

The bar chart and table indicate the risks of investing in the fund by showing
how the fund has performed in the past. The fund's performance varies from year
to year

The fund's past performance does not necessarily indicate how it will perform
in the future. As a shareowner, you may lose or make money on your investment.

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

Fund performance

The chart shows the performance of the fund's Class A shares for each full
calendar year since the fund's inception on February 28, 1997. Class B shares
have different performance. The chart does not reflect any Class A sales charge
you may pay when you buy or sell fund shares. Any sales charge will reduce your
return.

The fund's highest calendar quarterly return was 21.96% (3/31/99 to 6/30/99)
The fund's lowest calendar quarterly return was -26.57% (9/30/98 to 12/31/98)

Annual return Class A shares
(Year ended December 31)

[bar chart]
98 -12.69

99 35.96
[end bar chart]

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

Comparison with Merrill Lynch Micro-Cap Index
The table shows the average annual total returns for each class of the fund
over time and compares these returns to the returns of the Merrill Lynch
Micro-Cap Index. This index is a recognized measure of the performance of U.S.
micro-cap stocks. Unlike the fund, the index is not managed and does not incur
expenses. The table:
o Reflects sales charges applicable to the class
o Assumes that you sell your shares at the end of the period

o Assumes that you reinvest all of your dividends and distributions

Average annual total return (%)
(for periods ended December 31, 1999)

Since Inception
1 Year Inception Date
- ---------------------------------------------------------
<S> <C> <C> <C>
Class A 28.13 9.60 2/28/97
- ---------------------------------------------------------
Class B 30.90 10.28 2/28/97
- ---------------------------------------------------------
Micro-Cap Index 40.04 17.30 -
- ---------------------------------------------------------
</TABLE>

2
<PAGE>

Basic information about the fund

Fees and expenses
These are the fees and expenses, based on the fund's latest fiscal
year, you may pay if you invest in the fund.

<TABLE>
<CAPTION>
Shareowner fees
paid directly from your investment Class A Class B
- -----------------------------------------------------------------------------
<S> <C> <C>

Maximum sales charge (load) when you buy shares
as a percentage of offering price 5.75% None
- -----------------------------------------------------------------------------

Maximum deferred sales charge (load) as a
percentage of offering price or the amount you
receive when you sell shares, whichever is less None(1) 4%
- -----------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
Annual fund operating expenses
paid from the assets of the fund
as a percentage of average daily net assets Class A Class B
- -----------------------------------------------------------------------------
<S> <C> <C>

Management Fee 1.10% 1.10%
- -----------------------------------------------------------------------------
Distribution and Service (12b-1) Fee 0.25% 1.00%
- -----------------------------------------------------------------------------
Other Expenses 0.67% 0.63%
- -----------------------------------------------------------------------------
Total Annual Fund Operating Expenses 2.02% 2.73%
- -----------------------------------------------------------------------------
</TABLE>

1 Purchases of $1 million or more and purchases by participants in certain
group plans are not subject to an initial sales charge but may be subject
to a contingent deferred sales charge. See "Buying, exchanging and selling
shares."

Example

This example helps you compare the cost of investing in the fund with the cost
of investing in other mutual funds. It assumes that: a) you invest $10,000 in
the fund for the time periods shown, b) you reinvest all dividends and
distributions, c) your investment has a 5% return each year and d) the fund's
operating expenses remain the same.

Although your actual costs may be higher or lower, under these assumptions your
costs would be:

<TABLE>
<CAPTION>
If you sell your shares If you do not sell your shares
-----------------------------------------------------------------------------------------
Number of years you own your shares
-----------------------------------------------------------------------------------------
1 3 5 10 1 3 5 10
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>

Class A $768 $1,172 $1,600 $2,788 $768 $1,172 $1,600 $2,788
- -----------------------------------------------------------------------------------------------------
Class B 676 1,147 1,645 2,890 276 847 1,445 2,890
- -----------------------------------------------------------------------------------------------------
</TABLE>

3
<PAGE>

Other investment strategies
As discussed, the fund invests primarily in common stocks of micro-cap
companies.

This section describes additional investments that the fund may make or
strategies that it may pursue to a lesser degree to achieve the fund's goal.
Some of the fund's secondary investment policies also entail risks. To learn
more about these investments and risks, you should obtain and read the
statement of additional information (SAI).

More on principal investments
The fund may invest up to 25% of its total assets (at the time of purchase) in
real estate investment trusts. Real estate investment trusts are pooled
investment vehicles that invest primarily in real estate or real estate related
loans. Investing in real estate investment trusts involves unique risks. They
are significantly affected by the market for real estate and are dependent upon
management skills and cash flow.

Investments other than U.S. common stocks
The fund may invest in securities of Canadian issuers to the same extent as
securities of U.S. issuers. In addition, the fund may invest up to 5% of its
total assets (at the time of purchase) in equity and debt securities of other
non-U.S. issuers, including securities of emerging markets issuers. Investing
in Canadian and other non-U.S. issuers may involve unique risks compared to
investing in securities of U.S. issuers.

The fund may invest up to 20% of its total assets (at the time of purchase) in
debt securities of corporate and government issuers. Generally the fund
acquires debt securities that are investment grade, but the fund may invest up
to 5% of its total assets (at the time of purchase) in below investment grade
debt securities. The fund invests in debt securities when Pioneer believes they
are consistent with the fund's investment objective, to diversify the fund's
portfolio or for greater liquidity.

Debt securities are subject to the risk of an issuer's inability to meet
principal or interest payments on its obligations. Factors which could
contribute to a decline in the market value of debt securities in the fund's
portfolio include rising interest rates or a reduction in the perceived
creditworthiness of the issuer of the securities. A debt security is investment
grade if it is rated in one of the top four categories by a nationally
recognized securities rating organization or determined to be of equivalent
credit quality by Pioneer. Debt securities rated below investment grade are
commonly referred to as "junk bonds" and are considered speculative. Below
investment grade debt securities involve greater risk of loss, are subject to
greater price volatility and are less liquid, especially during periods of
economic uncertainty or change, than higher quality debt securities.

Temporary investments

Normally, the fund invests substantially all of its assets to meet its
investment objective. The fund may invest the remainder of its assets (normally
not more than 10% of assets) in securities with remaining maturities of less
than one year or may hold cash or cash equivalents. For temporary defensive
purposes, the fund may depart from its principal investment strategies and
invest part or all of its assets in these securities or may hold cash. During
such periods, the fund may not be able to achieve its investment objective. The
fund intends to adopt a defensive strategy only when Pioneer believes common
stocks have extraordinary risks due to political or economic factors.

4
<PAGE>

Basic information about the fund

Short-term trading
The fund usually does not trade for short-term profits. The fund will sell an
investment, however, even if it has only been held for a short time, if it no
longer meets the fund's investment criteria. If the fund does a lot of trading,
it may incur additional operating expenses, which would reduce performance, and
could cause shareowners to incur a higher level of taxable income or capital
gains.

Derivatives

The fund may use futures, options and other derivatives. A derivative is a
security or instrument whose value is determined by reference to the value or
the change in value of one or more securities, currencies, indices or other
financial instruments. The fund does not use derivatives as a primary
investment technique and generally limits their use to hedging. However, the
fund may use derivatives for a variety of non-principal purposes, including:
o As a hedge against adverse changes in stock market prices, interest rates or
currency exchange rates
o As a substitute for purchasing or selling securities
o To increase the fund's return as a non-hedging strategy that may be
considered speculative

Even a small investment in derivatives can have a significant impact on the
fund's exposure to stock market values, interest rates or currency exchange
rates. If changes in a derivative's value do not correspond to changes in the
value of the fund's other investments, the fund may not fully benefit from or
could lose money on the derivative position. In addition, some derivatives
involve risk of loss if the person who issued the derivative defaults on its
obligation. Certain derivatives may be less liquid and more difficult to value.

5
<PAGE>

Management

Pioneer, the fund's investment adviser,
selects the fund's investments and oversees the fund's operations.

Pioneer Group

The Pioneer Group, Inc. and its subsidiaries are engaged in financial services
businesses in the United States and many foreign countries. As of December 31,
1999, the firm had more than $24 billion in assets under management worldwide
including more than $23 billion in U.S. mutual funds. The firm's U.S. mutual
fund investment history includes creating in 1928 one of the first mutual
funds. John F. Cogan, chairman of the board and president of The Pioneer Group,
Inc., owns approximately 14% of the firm. He is also an officer and director of
each of the Pioneer mutual funds.

Investment adviser
Pioneer manages a family of U.S. and international stock funds, bond funds and
money market funds. Pioneer is a subsidiary of The Pioneer Group, Inc. Its main
office is at 60 State Street, Boston, Massachusetts 02109.

Portfolio manager

Day-to-day management of the fund's portfolio is the responsibility of a team
of portfolio managers and analysts supervised by Kenneth G. Fuller, Pioneer's
small- and micro-cap team leader. This team manages and provides research for
the fund and other Pioneer mutual funds with similar investment objectives or
styles.

Mr. Fuller is a senior vice president of Pioneer. He joined Pioneer in October
1999 and has been an investment professional since 1975. Prior to joining
Pioneer, Mr. Fuller was a principal and analyst at Manley Fuller Asset
Management from 1994 to 1999. Mr. Fuller and his team operate under the
supervision of Theresa A. Hamacher. Ms. Hamacher is chief investment officer of
Pioneer. She joined Pioneer in 1997 and has been an investment professional
since 1984, most recently as chief investment officer at another investment
adviser.

Management fee
The fund pays Pioneer a fee for managing the fund and to cover the cost of
providing certain services to the fund. Pioneer's annual fee is equal to 1.10%
of the fund's average daily net assets. The fee is normally computed daily and
paid monthly.

Distributor and transfer agent
Pioneer Funds Distributor, Inc. is the fund's distributor. Pioneering Services
Corporation is the fund's transfer agent. The fund compensates the distributor
and transfer agent for their services. The distributor and the transfer agent
are subsidiaries of The Pioneer Group, Inc.

6
<PAGE>

Buying, exchanging and selling shares

[sidebar]
[magnifying glass graphic]

Share price
The net asset value per share
calculated on the day of your
transaction, adjusted for any
applicable sales charge, is often
referred to as the share price.

[end sidebar]

Net asset value

The fund's net asset value is the value of its portfolio of securities plus any
other assets minus its operating expenses and any other liabilities. The fund
calculates a net asset value for each class of shares every day the New York
Stock Exchange is open when regular trading closes (normally 4:00 p.m. Eastern
time).

The fund generally values its portfolio securities based on market prices or
quotations. When market prices are not available or are considered by Pioneer
to be unreliable, the fund may use an asset's fair value. Fair value is
determined in accordance with procedures approved by the fund's trustees.
International securities markets may be open on days when the U.S. markets are
closed. For this reason, the values of any international securities owned by
the fund could change on a day when you cannot buy or sell shares of the fund.

You buy or sell shares at the share price. When you buy Class A shares, you pay
an initial sales charge. When you sell Class B shares, you may pay a contingent
deferred sales charge depending on how long you have owned your shares.

Choosing a class of shares

The fund offers two classes of shares through this prospectus. Each class has
different sales charges and expenses, allowing you to choose the class that
best meets your needs.

Factors you should consider include:
o How long you expect to own the shares
o The expenses paid by each class
o Whether you qualify for any reduction or waiver of sales charges

Your investment professional can help you determine which class meets your
goals. Your investment firm may receive different compensation depending upon
which class you choose. If you are not a U.S. citizen and are purchasing shares
outside the U.S., you may pay different sales charges under local laws and
business practices.

Distribution plans

The fund has adopted a distribution plan for each class of shares offered
through this prospectus in accordance with Rule 12b-1 under the Investment
Company Act of 1940. Under each plan the fund pays distribution and service
fees to the distributor. Because these fees are an ongoing expense, over time
they increase the cost of your investment and your shares may cost more than
shares that are subject to other types of sales charges.

- --------------------------------------------------------------------------------
The fund reserves the right to temporarily or permanently close the fund to
new investors or to restrict investments by existing shareholders. The fund
will consider total assets under management, the flow of new investments
into the fund and other factors in making such decisions.
- --------------------------------------------------------------------------------

7
<PAGE>

- --------------------------------------------------------------------------------
Comparing classes of shares
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Class A Class B
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Why you might prefer each Class A shares may be your best You may prefer Class B shares if
class alternative if you prefer to pay an you do not want to pay an initial
initial sales charge and have sales charge, or if you plan to
lower annual expenses, or if you hold your investment for at least
qualify for any reduction or six years. Class B shares are not
waiver of the initial sales charge. recommended if you are
investing $250,000 or more.
- -------------------------------------------------------------------------------------------------------------
Initial sales charge Up to 5.75% of the offering None
price, which is reduced or waived
for large purchases and certain
types of investors. At the time of
your purchase, your investment
firm may receive a commission
from the distributor of up to 5%,
declining as the size of your
investment increases.
- -------------------------------------------------------------------------------------------------------------
Contingent deferred sales None, except in certain Up to 4% is charged if you sell
charges circumstances when the initial your shares. The charge is
sales charge is waived. reduced over time and not
charged after six years. Your
investment firm may receive a
commission from the distributor
at the time of your purchase of
up to 4%.
- -------------------------------------------------------------------------------------------------------------
Distribution and service fees Up to 0.25% of average daily net Up to 1% of average daily net
assets. assets.
- -------------------------------------------------------------------------------------------------------------
Annual expenses (including Lower than Class B. Higher than Class A shares;
distribution and service fees) Class B shares convert to Class
A shares after eight years.
- -------------------------------------------------------------------------------------------------------------
Exchange privilege Class A shares of other Pioneer Class B shares of other Pioneer
mutual funds. mutual funds.
</TABLE>

8
<PAGE>

Buying, exchanging and selling shares

[sidebar]
[magnifying glass graphic]

Offering price
The net asset value
per share plus any
initial sales charge.

[end sidebar]

Sales charges: Class A shares

You pay the offering price when you buy Class A shares unless you qualify to
purchase shares at net asset value. You pay a lower sales charge as the size of
your The net asset value investment increases. You do not pay a sales charge
when you reinvest dividends or distributions paid by the fund.

Investments of $1 million or more

You do not pay a sales charge when you purchase Class A shares if you are
investing $1 million or more or you are a participant in certain group plans.
However, you pay a deferred sales charge if you sell your Class A shares within
one year of purchase. The sales charge is equal to 1% of your investment or
your sale proceeds, whichever is less.

Reduced sales charges
You may qualify for a reduced Class A sales charge if you own or are purchasing
shares of Pioneer mutual funds. If you or your investment professional notifies
the distributor of your eligibility for a reduced sales charge at the time of
your purchase, the distributor will credit you with the combined value (at the
current offering price) of all your Pioneer mutual fund shares and the shares
of your spouse and the shares of any children under 21. Certain trustees and
fiduciaries may also qualify for a reduced sales charge. For this purpose,
Pioneer mutual funds include any fund for which the distributor is principal
underwriter and, at the distributor's discretion, may include funds organized
outside the U.S. managed by Pioneer.

See "Qualifying for a reduced sales charge" for more information.

Sales charges for Class A shares

<TABLE>
<CAPTION>
Sales charge as % of
------------------------
Offering Net amount
Amount of purchase price invested
- --------------------------------------------------------------
<S> <C> <C>
Less than $50,000 5.75 6.10
- --------------------------------------------------------------
$50,000 but less than $100,000 4.50 4.71
- --------------------------------------------------------------
$100,000 but less than $250,000 3.50 3.63
- --------------------------------------------------------------
$250,000 but less than $500,000 2.50 2.56
- --------------------------------------------------------------
$500,000 but less than $1 million 2.00 2.04
- --------------------------------------------------------------
$1 million or more -0- -0-
- --------------------------------------------------------------
</TABLE>

9
<PAGE>

[sidebar]
[magnifying glass graphic]

Contingent deferred sales charge
A sales charge that may be deducted
from your sale proceeds.

[end sidebar]

Sales charges: Class B shares

You buy Class B shares at net asset value per share without paying an initial
sales charge. However, you will pay a contingent deferred sales charge to the
distributor if you sell your Class B shares within six years of purchase. The
contingent deferred sales charge decreases as the number of years since your
purchase increases.

<TABLE>
<CAPTION>
Contingent deferred sales charge
- -----------------------------------------
On shares sold As a % of
before the dollar amount subject
end of year to the sales charge
- -----------------------------------------
<S> <C>
1 4
- -----------------------------------------
2 4
- -----------------------------------------
3 3
- -----------------------------------------
4 3
- -----------------------------------------
5 2
- -----------------------------------------
6 1
- -----------------------------------------
7+ -0-
- -----------------------------------------
</TABLE>

Conversion to Class A shares
Class B shares automatically convert into Class A shares. This helps you
because Class A shares pay lower expenses.

Your Class B shares will convert to Class A shares at the beginning of the
calendar month (calendar quarter for shares purchased before October 1, 1998)
that is eight years after the date of purchase except that:

o Shares purchased by reinvesting dividends and capital gain distributions will
convert to Class A shares at the same time as shares on which the dividend
or distribution was paid
o Shares purchased by exchanging shares from another fund will convert on the
date that the shares originally acquired would have converted into Class A
shares

Currently, the Internal Revenue Service permits the conversion of shares to
take place without imposing a federal income tax. Conversion may not occur if
the Internal Revenue Service deems it a taxable event for federal tax purposes.

- --------------------------------------------------------------------------------
Paying the contingent deferred sales charge (CDSC)

Several rules apply for Class B shares so that you pay the lowest possible CDSC.
o The CDSC is calculated on the current market value or the original cost of
the shares you are selling, whichever is less
o You do not pay a CDSC on reinvested dividends or distributions
o In determining the number of years since your purchase, all purchases are
considered to have been made on the first day of that month (quarter for
shares purchased before October 1, 1998)
o If you sell only some of your shares, the transfer agent will first sell your
shares that are not subject to any CDSC and then the shares that you have
owned the longest
o You may qualify for a waiver of the CDSC normally charged. See "Qualifying
for a reduced sales charge"
- --------------------------------------------------------------------------------

10
<PAGE>

Buying, exchanging and selling shares

Qualifying for a reduced sales charge

Initial Class A sales charge waivers
You may purchase Class A shares at net asset value (without a sales charge) or
with a reduced initial sales charge as follows. If you believe you qualify for
any of the waivers discussed below, contact the distributor. You are required
to provide written confirmation of your eligibility. You may not resell these
shares except to or on behalf of the fund.

Class A purchases at net asset value are available to:
o Current or former trustees and officers of the fund;
o Current or former partners and employees of legal counsel to the fund;
o Current or former directors, officers, employees or sales representatives of
The Pioneer Group, Inc. and its affiliates;
o Current or former directors, officers, employees or sales representatives of
any subadviser or a predecessor adviser (or their affiliates) to any
investment company for which Pioneer serves as investment adviser;
o Current or former officers, partners, employees or registered representatives
of broker-dealers which have entered into sales agreements with the
distributor;
o Members of the immediate families of any of the persons above;
o Any trust, custodian, pension, profit sharing or other benefit plan of the
foregoing persons;
o Insurance company separate accounts;
o Certain "wrap accounts" for the benefit of clients of financial planners
adhering to standards established by the distributor;
o Other funds and accounts for which Pioneer or any of its affiliates serve as
investment adviser or manager;
o In connection with certain reorganization, liquidation or acquisition
transactions involving other investment companies or personal holding
companies;
o Certain unit investment trusts;

o Employer-sponsored retirement plans with 100 or more eligible employees or at
least $500,000 in total plan assets;
o Participants in Optional Retirement Programs if (i) your employer has
authorized a limited number of mutual funds to participate in the program,
(ii) all participating mutual funds sell shares to program participants at
net asset value, (iii) your employer has agreed in writing to actively
promote Pioneer mutual funds to program participants and (iv) the program
provides for a matching contribution for each participant contribution;
o Participants in an employer-sponsored 403(b) plan or employer-sponsored 457
plan if (i) the employer has made special arrangements for your plan to
operate as a group through a single broker, dealer or financial
intermediary and (ii) all participants in the plan who purchase shares of a
Pioneer mutual fund do so through a single broker, dealer or other
financial intermediary designated by your employer.

11
<PAGE>

Class A purchases at a reduced initial sales charge or net asset value are also
available to:
Group Plans if the sponsoring organization
o recommends purchases of Pioneer mutual funds to,
o permits solicitation of, or
o facilitates purchases by
its employees, members or participants.

Letter of intent (Class A)
You can use a letter of intent to qualify for reduced sales charges in two
situations:
o If you plan to invest at least $50,000 (excluding any reinvestment of
dividends and capital gain distributions) in the fund's Class A shares
during the next 13 months

o If you include in your letter of intent the value--at the current offering
price--of all of your Class A shares of the fund and all other Pioneer
mutual fund shares held of record in the amount used to determine the
applicable sales charge for the fund shares you plan to buy

Completing a letter of intent does not obligate you to purchase additional
shares, but if you do not buy enough shares to qualify for the projected level
of sales charges by the end of the 13-month period (or when you sell your
shares, if earlier), the distributor will recalculate your sales charge. You
must pay the additional sales charge within 20 days after you are notified of
the recalculation or it will be deducted from your account (or your sale
proceeds). For more information regarding letters of intent, please contact
your investment professional or obtain and read the statement of additional
information.

Reinvestment (Class A)
If you sold shares of another mutual fund within the past 60 days, you may be
able to reinvest the sale proceeds from that fund in Class A shares of the fund
at net asset value without a sales charge.

To qualify:
o Your investment firm must have a sales agreement with the distributor;
o You must demonstrate that the amount invested is from the proceeds of the
sale of shares from another mutual fund that occurred within 60 days
immediately preceding your purchase;
o You paid a sales charge on the original purchase of the shares sold; and
o The mutual fund whose shares were sold also offers net asset value purchases
to shareowners that sell shares of a Pioneer mutual fund.

12
<PAGE>

Buying, exchanging and selling shares

Waiver or reduction of contingent deferred sales charges (CDSC)

Class A shares that are subject to a CDSC

Purchases of Class A shares of $1 million or more, or by participants in a
Group Plan which were not subject to an initial sales charge, may be subject to
a CDSC upon redemption. A CDSC is payable to the distributor in the event of a
share redemption within 12 months following the share purchase at the rate of
1% of the lesser of the value of the shares redeemed (exclusive of reinvested
dividend and capital gain distributions) or the total cost of such shares.
However, the CDSC is waived for redemptions of Class A shares purchased by an
employer-sponsored retirement plan described under Section 401(a), 403(b) or
457 of the Internal Revenue Code that has 1,000 or more eligible employees or
at least $10 million in total plan assets.

Class A and Class B shares
The distributor may waive or reduce the CDSC for Class A shares that are
subject to a CDSC or for Class B shares if:
o The distribution results from the death of all registered account owners or a
participant in an employer-sponsored plan. For UGMAs, UTMAs and trust
accounts, the waiver applies only upon the death of all beneficial owners;

o You become disabled (within the meaning of Section 72 of the Internal Revenue
Code) after the purchase of the shares being sold. For UGMAs, UTMAs and
trust accounts, the waiver only applies upon the disability of all
beneficial owners;
o The distribution is made in connection with limited automatic redemptions as
described in "Systematic withdrawal plans" (limited in any year to 10% of
the value of the account in the fund at the time the withdrawal plan is
established);

o The distribution is from any type of IRA, 403(b) or employer-sponsored plan
described under Section 401(a) or 457 of the Internal Revenue Code and one
of the following applies:
- It is part of a series of substantially equal periodic payments made over
the life expectancy of the participant or the joint life expectancy of
the participant and his or her beneficiary (limited in any year to 10% of
the value of the participant's account at the time the distribution
amount is established);
- It is a required minimum distribution due to the attainment of age
70-1/2, in which case the distribution amount may exceed 10% (based
solely on plan assets held in Pioneer mutual funds);

13
<PAGE>

- It is rolled over to or reinvested in another Pioneer mutual fund in the
same class of shares, which will be subject to the CDSC of the shares
originally held;
- It is in the form of a loan to a participant in a plan that permits loans
(each repayment will be subject to a CDSC as though a new purchase);

o The distribution is to a participant in an employer-sponsored retirement plan
described under Section 401 of the Internal Revenue Code or to a
participant in an employer-sponsored 403(b) plan or employer-sponsored 457
plan if (i) the employer has made special arrangements for your plan to
operate as a group through a single broker, dealer or financial
intermediary and (ii) all participants in the plan who purchase shares of a
Pioneer mutual fund do so through a single broker, dealer or other
financial intermediary designated by your employer and is:
- A return of excess employee deferrals or contributions;

- A qualifying hardship distribution as described in the Internal Revenue
Code. For Class B shares, waiver is granted only on payments of up to 10%
of total plan assets held by Pioneer for all participants, reduced by the
total of any prior distributions made in that calendar year;
- Due to retirement or termination of employment. For Class B shares,
waiver is granted only on payments of up to 10% of total plan assets held
in a Pioneer mutual fund for all participants, reduced by the total of
any prior distributions made in the same calendar year;
- From a qualified defined contribution plan and represents a participant's
directed transfer, provided that this privilege has been preauthorized
through a prior agreement with the distributor regarding participant
directed transfers (not available to Class B shares);
o The distribution is made pursuant to the fund's right to liquidate or
involuntarily redeem shares in a shareholder's account;
o The selling broker elects, with the distributor's approval, to waive receipt
of the commission normally paid at the time of the sale.

14
<PAGE>

Buying, exchanging and selling shares

[sidebar]
[telephone graphic]

By phone
If you want to place your telephone
transaction by speaking to a shareowner
services representative, call 1-800-225-6292
between 8:00 a.m. and 9:00 p.m. Eastern time on
any weekday that the New York Stock Exchange is
open. You may use FactFone(SM) at any time.

[end sidebar]

Opening your account

If your shares are held in your investment firm's name, the options and
services available to you may be different from those discussed in this
prospectus. Ask your investment professional for more information.

If you invest in the fund through investment professionals or other financial
intermediaries, including wrap programs and fund supermarkets, additional
conditions may apply to your investment in the fund, and the investment
professional or intermediary may charge you a transaction-based or other fee
for its services. These conditions and fees are in addition to those imposed by
the fund and its affiliates. You should ask your investment professional or
financial intermediary about its services and any applicable fees.

Account options
Use your account application to select options and privileges for your account.
You can change your selections at any time by sending a completed account
options form to the transfer agent. You may be required to obtain a signature
guarantee to make certain changes to an existing account.

Call or write to the transfer agent for account applications, account options
forms and other account information:

Pioneering Services Corporation
P.O. Box 9014
Boston, Massachusetts 02205-9014
Telephone 1-800-225-6292

Telephone transaction privileges
If your account is registered in your name, you can buy, exchange or sell fund
shares by telephone. If you do not want your account to have telephone
transaction privileges, you must indicate that choice on your account
application or by writing to the transfer agent.

When you request a telephone transaction the transfer agent will try to confirm
that the request is genuine. The transfer agent records the call, requires the
caller to provide the personal identification number for the account and sends
you a written confirmation. The fund may implement other confirmation
procedures from time to time. Different procedures may apply if you have a
non-U.S. account or if your account is registered in the name of an
institution, broker-dealer or other third party.

15
<PAGE>

General rules on buying, exchanging and selling your fund shares

[sidebar]
[question mark graphic]

Consult your investment
professional to learn more
about buying, exchanging
or selling fund shares.

[end sidebar]

Share price

If you place an order with your investment firm before the New York Stock
Exchange closes and your investment firm submits the order to the distributor
prior to the distributor's close of business (usually 5:30 p.m. Eastern time),
your share price will be calculated that day. Otherwise, your share price will
be calculated at the close of the New York Stock Exchange after the distributor
receives your order. Your investment firm is responsible for submitting your
order to the distributor.

Buying
You may buy fund shares from any investment firm that has a sales agreement
with the distributor. If you do not have an investment firm, please call
1-800-225-6292 for information on how to locate an investment professional in
your area.

You can buy fund shares at the offering price. The distributor may reject any
order until it has confirmed the order in writing and received payment. The
fund reserves the right to stop offering any class of shares.

Minimum investment amounts

Your initial investment must be at least $5,000. Additional investments must be
at least $1,000 for Class A or Class B shares. You may qualify for lower
initial or subsequent investment minimums if you are opening a retirement plan
account, establishing an automatic investment plan or placing your trade
through your investment firm.

- --------------------------------------------------------------------------------
Retirement plan accounts

You can purchase fund shares through tax-deferred retirement plans for
individuals, businesses and tax-exempt organizations.

Your initial investment for most types of retirement plan accounts must be at
least $250. Additional investments for most types of retirement plans must be
at least $100.

You may not use the account application accompanying this prospectus to
establish a Pioneer retirement plan. You can obtain retirement plan
applications from your investment firm or by calling the Retirement Plans
Department at 1-800-622-0176.
- --------------------------------------------------------------------------------

16
<PAGE>

Buying, exchanging and selling shares

[sidebar]
[pillar graphic]

You may have to pay income taxes
on a sale or an exchange.

[end sidebar]

Exchanging
You may exchange your shares for shares of the same class of another Pioneer
mutual fund.

Your exchange request must be for at least $1,000 unless the fund you are
exchanging into has a different minimum. The fund allows you to exchange your
shares at net asset value without charging you either an initial or contingent
deferred sales charge at the time of the exchange. Shares you acquire as part
of an exchange will continue to be subject to any contingent deferred sales
charge that applies to the shares you originally purchased. When you ultimately
sell your shares, the date of your original purchase will determine your
contingent deferred sales charge.

Before you request an exchange, consider each fund's investment objective and
policies as described in the fund's prospectus.

Selling
Your shares will be sold at net asset value per share next calculated after the
fund receives your request in good order.

If the shares you are selling are subject to a deferred sales charge, it will
be deducted from the sale proceeds. The fund generally will send your sale
proceeds by check, bank wire or electronic funds transfer. Normally you will be
paid within seven days. If you recently sent a check to purchase the shares
being sold, the fund may delay payment of the sale proceeds until your check
has cleared. This may take up to 15 calendar days from the purchase date.

If you are selling shares from a non-retirement account or certain IRAs, you
may use any of the methods described below. If you are selling shares from a
retirement account other than an IRA, you must make your request in writing.

- --------------------------------------------------------------------------------
Good order means that:
o You have provided adequate instructions
o There are no outstanding claims against your account
o There are no transaction limitations on your account
o If you have any fund share certificates, you submit them and they are
signed by each record owner exactly as the shares are registered
o Your request includes a signature guarantee if you:
- Are selling over $100,000 or exchanging over $500,000 worth of shares
- Changed your account registration or address within the last 30 days
- Instruct the transfer agent to mail the check to an address different
from the one on your account
- Want the check paid to someone other than the account owner(s)
- Are transferring the sale proceeds to a Pioneer mutual fund account with
a different registration
- --------------------------------------------------------------------------------

17
<PAGE>

<TABLE>
<CAPTION>
-------------------------------------------------- ------------------------------------------------
Buying shares Exchanging shares
-------------------------------------------------- ------------------------------------------------
<S> <C> <C>
Through your Normally, your investment firm will send your Normally, your investment firm will send your
investment firm purchase request to the fund's transfer agent. exchange request to the fund's transfer agent.
Consult your investment professional for Consult your investment professional for
more information. Your investment firm may more information about exchanging your
receive a commission from the distributor for your shares.
purchase of fund shares. The distributor or its
affiliates may pay additional compensation, out of
their own assets, to certain investment firms or
their affiliates based on objective criteria
established by the distributor.

-------------------------------------------------- ------------------------------------------------
By phone You can use the telephone purchase privilege After you establish your fund account, you can
if you have an existing non-retirement account or exchange fund shares by phone if:
certain IRAs. You can purchase additional fund o You are using the exchange to establish a new
shares by phone if: account, provided the new account has a
o You established your bank account of record at registration identical to the original account
least 30 days ago o The fund into which you are exchanging offers
o Your bank information has not changed for at the same class of shares
least 30 days o You are not exchanging more than $500,000
o You are not purchasing more than $25,000 worth of shares per account per day
worth of shares per account per day o You can provide the proper account
o You can provide the proper account identification information
identification information

When you request a telephone purchase, the
transfer agent will electronically debit the amount
of the purchase from your bank account of record.
The transfer agent will purchase fund shares for
the amount of the debit at the offering price
determined after the transfer agent receives your
telephone purchase instruction and good funds. It
usually takes three business days for the transfer
agent to receive notification from your bank that
good funds are available in the amount of your
investment.

-------------------------------------------------- ------------------------------------------------
In writing, You can purchase fund shares for an existing fund You can exchange fund shares by mailing or
by mail account by mailing a check to the transfer faxing a letter of instruction to the transfer
or by fax agent. Make your check payable to the fund. agent. You can exchange fund shares directly
Neither initial nor subsequent investments should through the fund only if your account is registered
be made by third party check. Your check must be in your name. However, you may not fax an
in U.S. dollars and drawn on a U.S. bank. Include exchange request for more than $500,000.
in your purchase request the fund's name, the Include in your letter:

account number and the name or names in the o The name, social security number and signature
account registration. of all registered owners
o A signature guarantee for each registered owner
if the amount of the exchange is more than
$500,000
o The name of the fund out of which you are
exchanging and the name of the fund into which
you are exchanging
o The class of shares you are exchanging
o The dollar amount or number of shares you are
exchanging
</TABLE>

18
<PAGE>
Buying, exchanging and selling shares
<TABLE>
<CAPTION>
--------------------------------------------------------
Selling shares
--------------------------------------------------------
<S> <C>
Through your Normally, your investment firm will send your
investment firm request to sell shares to the fund's transfer
agent. Consult your investment professional
for more information. The fund has authorized
the distributor to act as its agent in the
repurchase of fund shares from qualified
investment firms. The fund reserves the right to
terminate this procedure at any time.
--------------------------------------------------------
By phone You may sell up to $100,000 per account
per day. You may sell fund shares held in a
retirement plan account by phone only if your
account is an IRA. You may not sell your shares
by phone if you have changed your address (for
checks) or your bank information (for wires and
transfers) in the last 30 days.

You may receive your sale proceeds:
o By check, provided the check is made payable
exactly as your account is registered
o By bank wire or by electronic funds transfer,
provided the sale proceeds are being sent to
your bank address of record
--------------------------------------------------------

In writing, You can sell some or all of your fund shares by
by mail writing directly to the fund only if your account
or by fax is registered in your name. Include in your
request your name, your social security number,
the fund's name, your fund account number, the
class of shares to be sold, the dollar amount or
number of shares to be sold and any other
applicable requirements as described below. The
transfer agent will send the sale proceeds to
your address of record unless you provide other
instructions. Your request must be signed by all
registered owners and be in good order.
The transfer agent will not process your request
until it is received in good order.
You may sell up to $100,000 per account per
day by fax.</TABLE>
- -------------------------------------------------------------
How to contact us

By phone [telephone graphic]
For information or to request a telephone transaction
between 8:00 a.m. and 9:00 p.m. (Eastern time) by
speaking with a shareholder services representative call
1-800-225-6292
To request a transaction using FactFone(SM) call
1-800-225-4321
Telecommunications Device for the Deaf (TDD)
1-800-225-1997

By mail [envelope graphic]
Send your written instructions to:
Pioneering Services Corporation
P.O.Box 9014
Boston, Massachusetts 02205-9014

By fax [fax graphic]
Fax your exchange and sale requests to:
1-800-225-4240
- -------------------------------------------------------------

- -------------------------------------------------------------
Exchange privilege

You may make up to four exchange redemptions of $25,000 or more
per account per calendar year.

The fund and the distributor reserve the right to refuse any exchange request
or restrict, at any time without notice, the number and/or frequency of
exchanges to prevent abuses of the exchange privilege. Abuses include frequent
trading in response to short-term market fluctuations and a pattern of trading
that appears to be an attempt to "time the market." In addition, the fund and
the distributor reserve the right, at any time without notice, to charge a fee
for exchanges or to modify, limit or suspend the exchange privilege. The fund
will provide 60 days' notice of material amendments to or termination of the
privilege.
- -------------------------------------------------------------

19
<PAGE>

Account options
See the account application form for more details on each of the following
options.

Automatic investment plans

You can make regular periodic investments in the fund by setting up monthly
bank drafts, government allotments, payroll deductions, a Pioneer Investomatic
Plan and other similar automatic investment plans. You may use an automatic
investment plan to establish a Class A share account with a small initial
investment. If you have a Class B share account and your balance is at least
$1,000, you may establish an automatic investment plan.

Pioneer Investomatic Plan
If you establish a Pioneer Investomatic Plan, the transfer agent will make a
periodic investment in fund shares by means of a preauthorized electronic funds
transfer from your bank account. Your plan investments are voluntary. You may
discontinue your plan at any time or change the plan's dollar amount, frequency
or investment date by calling or writing to the transfer agent. You should
allow up to 30 days for the transfer agent to establish your plan.

Automatic exchanges

You can automatically exchange your fund shares for shares of the same class of
another Pioneer mutual fund. The automatic exchange will begin on the day you
select when you complete the appropriate section of your account application or
an account options form. In order to establish automatic exchange:
o You must select exchanges on a monthly or quarterly basis
o Both the originating and receiving accounts must have identical registrations

o The originating account must have a minimum balance of $5,000

Distribution options
The fund offers three distribution options. Any fund shares you buy by
reinvesting distributions will be priced at the applicable net asset value per
share.

(1) Unless you indicate another option on your account application, any
dividends and capital gain distributions paid to you by the fund will
automatically be invested in additional fund shares.

(2) You may elect to have the amount of any dividends paid to you in cash and
any capital gain distributions reinvested in additional shares.

(3) You may elect to have the full amount of any dividends and/or capital gain
distributions paid to you in cash.

Options (2) or (3) are not available to retirement plan accounts or accounts
with a current value of less than $500.

If your distribution check is returned to the transfer agent or you do not cash
the check for six months or more, the transfer agent may reinvest the amount of
the check in your account and automatically change the distribution option on
your account to option (1) until you request a different option in writing.
These additional shares will be purchased at the then current net asset value.

20
<PAGE>

Buying, exchanging and selling shares

Directed dividends
You can invest the dividends paid by one of your Pioneer mutual fund accounts
in a second Pioneer mutual fund account. The value of your second account must
be at least $1,000 ($500 for Pioneer Fund or Pioneer II). You may direct the
investment of any amount of dividends. There are no fees or charges for
directed dividends. If you have a retirement plan account, you may only direct
dividends to accounts with identical registrations.

Systematic withdrawal plans
When you establish a systematic withdrawal plan for your account, the transfer
agent will sell the number of fund shares you specify on a periodic basis and
the proceeds will be paid to you or to any person you select. You must obtain a
signature guarantee to direct payments to another person after you have
established your systematic withdrawal plan. Payments can be made either by
check or by electronic transfer to a bank account you designate.

To establish a systematic withdrawal plan:
o Your account must have a total value of at least $10,000 when you establish
your plan
o You must request a periodic withdrawal of at least $50
o You may not request a periodic withdrawal of more than 10% of the value of
any Class B share account (valued at the time the plan is implemented)

Systematic sales of fund shares may be taxable transactions for you. If you
purchase Class A shares while you are making systematic withdrawals from your
account, you may pay unnecessary sales charges.

Direct deposit
If you elect to take dividends or dividends and capital gain distributions in
cash, or if you establish a systematic withdrawal plan, you may choose to have
those cash payments deposited directly into your savings, checking or NOW bank
account.

Voluntary tax withholding
You may have the transfer agent withhold 28% of the dividends and capital gain
distributions paid from your fund account (before any reinvestment) and forward
the amount withheld to the Internal Revenue Service as a credit against your
federal income taxes. Voluntary tax withholding is not available for retirement
plan accounts or for accounts subject to backup withholding.

Reinstatement privilege for Class A shares
You may qualify for the reinstatement privilege if you recently sold all or
part of your Class A shares.

21
<PAGE>

Shareowner services

Pioneer website
www.pioneerfunds.com
The website includes a full selection of information on mutual fund investing.
You can also use the website to get:
o Your current account information
o Prices, returns and yields of all publicly available Pioneer mutual funds
o Prospectuses for all the Pioneer mutual funds

FactFone(SM) 1-800-225-4321
You can use FactFone(SM) to:
o Obtain current information on your Pioneer mutual fund accounts
o Inquire about the prices and yields of all publicly available Pioneer mutual
funds
o Make computer-assisted telephone purchases, exchanges and redemptions for
your fund accounts
o Request account statements

If you plan to use FactFone(SM) to make telephone purchases and redemptions,
first you must activate your personal identification number and establish your
bank account of record. If your account is registered in the name of a
broker-dealer or other third party, you may not be able to use FactFone(SM).

Household delivery of fund documents
With your consent, Pioneer may send a single prospectus and shareholder report
to your residence for you and any other member of your household who has an
account with the fund. If you wish to revoke your consent to this practice, you
may do so by notifying Pioneer, by phone or in writing (see "How to contact
us"). Pioneer will begin mailing separate prospectuses and shareholder reports
to you within 30 days after receiving your notice.

Confirmation statements
The transfer agent maintains an account for each investment firm or individual
shareowner and records all account transactions. You will be sent confirmation
statements showing the details of your transactions as they occur, except
automatic investment plan transactions, which are confirmed quarterly. If you
have more than one Pioneer mutual fund account registered in your name, the
Pioneer combined account statement will be mailed to you each quarter.

Tax information
In January of each year, the fund will mail you information about the tax
status of the dividends and distributions paid to you by the fund.

TDD 1-800-225-1997
If you have a hearing disability and access to TDD keyboard equipment, you can
contact our telephone representatives with questions about your account by
calling our TDD number between 8:30 a.m. and 5:30 p.m. Eastern time any weekday
that the New York Stock Exchange is open.

22
<PAGE>

Buying, exchanging and selling shares

[sidebar]
[magnifying glass graphic]

You may make up to four exchange
redemptions of $25,000 or more per
account per calendar year out of the
fund. Except as noted, you may make
any number of exchanges of less than
$25,000.

[end sidebar]

Shareowner account policies

Signature guarantees and other requirements
You are required to obtain a signature guarantee when you are:
o Requesting certain types of exchanges or sales of fund shares
o Redeeming shares for which you hold a share certificate
o Requesting certain types of changes for your existing account
You can obtain a signature guarantee from most broker-dealers, banks, credit
unions (if authorized under state law) and federal savings and loan
associations. You cannot obtain a signature guarantee from a notary public.

Fiduciaries and corporations are required to submit additional documents to
sell fund shares.

Exchange limitation
The fund's exchange limitation is intended to discourage short-term trading in
fund shares. Short-term trading can increase the expenses incurred by the fund
and make portfolio management less efficient. In determining whether the
exchange redemption limit has been reached, Pioneer may aggregate a series of
exchanges (each valued at less than $25,000) and/or fund accounts that appear
to be under common ownership or control. Pioneer may view accounts for which
one person gives instructions or accounts that act on advice provided by a
single source to be under common control.

The exchange limitation does not apply to automatic exchange transactions or to
exchanges made by participants in employer-sponsored retirement plans qualified
under Section 401 of the Internal Revenue Code. The exchange limitation does
not apply to accounts that have a written exchange agreement with the
distributor. The exchange limitation may not apply to transactions made through
an omnibus account for fund shares.

Minimum account size
The fund requires that you maintain a minimum account value of $500. If you
hold less than the minimum in your account because you have sold or exchanged
some of your shares, the fund will notify you of its intent to sell your shares
and close your account. You may avoid this by increasing the value of your
account to at least the minimum within six months of the notice from the fund.

Telephone access

You may have difficulty contacting the fund by telephone during times of market
volatility or disruption in telephone service. On New York Stock Exchange
holidays or on days when the exchange closes early, the telephone center will
adjust its hours accordingly. If you are unable to reach the fund by telephone,
you should communicate with the fund in writing.

Share certificates
Normally, your shares will remain on deposit with the transfer agent and
certificates will not be issued. If you are legally required to obtain a
certificate, you may request one for your Class A shares only. A fee may be
charged for this service.

Other policies
The fund may suspend transactions in shares when trading on the New York Stock
Exchange is closed or restricted, when an emergency exists that makes it
impracticable for the fund to sell or value its portfolio securities or with
the permission of the Securities and Exchange Commission.

The fund or the distributor may revise, suspend or terminate the account
options and services available to shareowners at any time.

The fund reserves the right to redeem in kind by delivering portfolio
securities to a redeeming shareowner, provided that the fund must pay
redemptions in cash if a shareowner's aggregate redemptions in a 90-day period
are less than $250,000 or 1% of the fund's net assets.

23
<PAGE>

Dividends, capital gains and taxes

[sidebar]
[pillar graphic]

Sales and exchanges may be taxable
transactions to shareowners.

[end sidebar]

Dividends and capital gains

The fund generally pays any distributions of net short- and long-term capital
gains in November. The fund generally pays dividends from any net investment
income in December. The fund may also pay dividends and capital gain
distributions at other times if necessary for the fund to avoid federal income
or excise tax. If you invest in the fund close to the time that the fund makes
a distribution, generally you will pay a higher price per share and you will pay
taxes on the amount of the distribution whether you reinvest the distribution
or receive it as cash.

Taxes

For federal income tax purposes, your distributions from the fund's net
long-term capital gains are considered long-term capital gains and may be
taxable to you at different maximum rates depending upon their source and other
factors. Dividends and short-term capital gain distributions are taxable as
ordinary income. Dividends and distributions are taxable, whether you take
payment in cash or reinvest them to buy additional fund shares. When you sell
or exchange fund shares you will generally recognize a capital gain or capital
loss in an amount equal to the difference between the net amount of sale
proceeds (or, in the case of an exchange, the fair market value of the shares)
that you receive and your tax basis for the shares that you sell or exchange.
In January of each year the fund will mail to you information about your
dividends, distributions and any shares you sold in the previous calendar year.

You must provide your social security number or other taxpayer identification
number to the fund along with the certifications required by the Internal
Revenue Service when you open an account. If you do not or if it is otherwise
legally required to do so, the fund will withhold 31% "backup withholding" tax
from your dividends and distributions, sale proceeds and any other payments to
you.

You should ask your own tax adviser about any federal and state tax
considerations, including possible additional withholding taxes for non-U.S.
shareholders. You may also consult the fund's statement of additional
information for a more detailed discussion of federal income tax considerations
that may affect the fund and its shareowners.

24
<PAGE>

Financial highlights

The financial highlights table helps you understand
the fund's financial performance since inception.

Certain information reflects financial results for a single fund share. The
total returns in the table represent the rate that you would have earned on an
investment in the fund (assuming reinvestment of all dividends and
distributions).

This information has been audited by Arthur Andersen LLP, whose report is
included in the fund's annual report along with the fund's financial
statements. The annual report is available upon request.

Pioneer Micro-Cap Fund
Class A shares

February 28,
For the year ended November 30 1997 through
------------------------------ November 30,
1999 1998 1997(a)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 13.85 $ 17.84 $ 15.00
---------------------------------------------------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.08) $ (0.15) $ (0.07)
Net realized and unrealized gain (loss) on investments and
futures contracts 3.63 (2.77) 2.91
---------------------------------------------------
Net increase (decrease) from investment operations $ 3.55 $ (2.92) $ 2.84
Distributions to shareholders:
Net realized gain - (1.07) -
---------------------------------------------------
Net increase (decrease) in net asset value $ 3.55 $ (3.99) $ 2.84
---------------------------------------------------
Net asset value, end of period $ 17.40 $ 13.85 $ 17.84
===================================================
Total return* 25.63% (17.17)% 18.93%
Ratios/Supplemental Data
Ratio of net expenses to average net assets[dagger] 2.02% 1.85% 1.76%**
Ratio of net investment income (loss) to average net
assets[dagger] (0.71)% (0.83)% (0.60)%**
Portfolio turnover rate 78% 81% 55%**
Net assets, end of period (in thousands) $33,714 $ 36,528 $51,825
Ratios assuming no waiver of management fees and assumption of
expenses by Pioneer and no reduction for fees paid indirectly:
Net expenses 2.02% 1.85% 2.12%**
Net investment income (loss) (0.71)% (0.83)% (0.96)%**
Ratios assuming waiver of management fees and assumption of
expenses by Pioneer and reduction for fees paid indirectly:
Net expenses 1.98% 1.84% 1.70%**
Net investment income (loss) (0.67)% (0.82)% (0.54)%**

- --------------------------------------------------------------------------------------------------------------------
(a) The per share data presented above is based upon the average shares
outstanding for the period presented.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales charges.
Total return would be reduced if sales charges were taken into account.
** Annualized.
[dagger] Ratio assuming no reduction for fees paid indirectly.
</TABLE>

25
<PAGE>

Pioneer Micro-Cap Fund
Class B shares

February 28,
For the year ended November 30 1997 through
------------------------------ November 30,
1999 1998 1997(a)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net asset value, beginning of period $ 13.69 $ 17.77 $ 15.00
---------------------------------------------------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.24) $ (0.25) $ (0.16)
Net realized and unrealized gain (loss) on investments and
futures contracts 3.62 (2.76) 2.93
---------------------------------------------------
Net increase (decrease) from investment operations $ 3.38 $ (3.01) $ 2.77
Distributions to shareholders:
Net realized gain - (1.07) -
---------------------------------------------------
Net increase (decrease) in net asset value $ 3.38 $ (4.08) $ 2.77
---------------------------------------------------
Net asset value, end of period $ 17.07 $ 13.69 $ 17.77
===================================================
Total return* 24.69% (17.78)% 18.47%
Ratios/Supplemental Data
Ratio of net expenses to average net assets[dagger] 2.73% 2.55% 2.48%**
Ratio of net investment income (loss) to average net
assets[dagger] (1.42)% (1.53)% (1.32)%**
Portfolio turnover rate 78% 81% 55%**
Net assets, end of period (in thousands) $56,711 $57,252 $70,971
Ratios assuming no waiver of management fees and assumption of
expenses by Pioneer and no reduction for fees paid indirectly:
Net expenses 2.73% 2.55% 2.81%**
Net investment income (loss) (1.42)% (1.53)% (1.65)%**
Ratios assuming waiver of management fees and assumption of
expenses by Pioneer and reduction for fees paid indirectly:
Net expenses 2.69% 2.54% 2.42%**
Net investment income (loss) (1.38)% (1.52)% (1.26)%**

26
<PAGE>

Pioneer
Micro-Cap Fund

You can obtain more free information about the fund from your investment firm
or by writing to Pioneering Services Corporation, 60 State Street, Boston,
Massachusetts 02109. You may also call 1-800-225-6292.

Shareowner reports
Annual and semiannual reports to shareowners provide information about the
fund's investments. The annual report discusses market conditions and
investment strategies that significantly affected the fund's performance during
its last fiscal year.

Statement of additional information
The statement of additional information provides more detailed information
about the fund. It is incorporated by reference into this prospectus.

Visit our website
www.pioneerfunds.com

You can also review the fund's shareowner reports, prospectus and statement of
additional information at the Securities and Exchange Commission's Public
Reference Room in Washington, D.C. Call 1-202-942-8090 for information. The
Commission charges a fee for copies. You can get the same information free from
the Commission's EDGAR database on the Internet (http://www.sec.gov). You may
also e-mail requests for these documents to [email protected] or make a
request in writing to the Commission's Public Reference Section, Washington,
D.C. 20549-0102.

(Investment Company Act file no. 811-07985)

[logo] Pioneer Funds Distributor, Inc.
60 State Street
Boston, MA 02109

www.pioneerfunds.com

8146-00-0300
(Copyright) Pioneer Funds Distributor, Inc.
<PAGE>

PIONEER MICRO-CAP FUND
60 State Street
Boston, Massachusetts 02109

STATEMENT OF ADDITIONAL INFORMATION

Class A and Class B Shares

March 29, 2000

This statement of additional information is not a prospectus. It should be read
in conjunction with the fund's Class A and Class B shares prospectus, dated
March 29, 2000, as supplemented or revised from time to time. A copy of the
prospectus can be obtained free of charge by calling Shareholder Services at
1-800-225-6292 or by written request to the fund at 60 State Street, Boston,
Massachusetts 02109. You can also obtain a copy of the fund's prospectus from
our website at: www.pioneerfunds.com. The fund's financial statements for the
fiscal year ended November 30, 1999 are incorporated into this statement of
additional information by reference. The most recent annual report to
shareholders is attached to this statement of additional information.

TABLE OF CONTENTS

Page

1. Fund History...........................................................2
2. Investment Policies, Risks and Restrictions............................2
3. Management of the Fund................................................19
4. Investment Adviser....................................................22
5. Principal Underwriter and Distribution Plans..........................24
6. Shareholder Servicing/Transfer Agent..................................28
7. Custodian.............................................................28
8. Independent Public Accountants........................................28
9. Portfolio Transactions................................................28
10. Description of Shares.................................................30
11. Sales Charges.........................................................32
12. Redeeming Shares......................................................34
13. Telephone Transactions................................................36
14. Pricing of Shares.....................................................37
15. Tax Status............................................................37
16. Investment Results....................................................42
17. Financial Statements..................................................44
18. Appendix A - Annual Fee, Expense and Other Information................45
19. Appendix B - Description of Short-term Debt, Corporate Bond
and Preferred Stock Ratings...........................................48
20. Appendix C - Performance Statistics...................................55
21. Appendix D - Other Pioneer Information................................70

<PAGE>

1. FUND HISTORY

The fund is a diversified open-end management investment company. The fund was
organized as a Delaware business trust on December 3, 1996.

2. INVESTMENT POLICIES, RISKS AND RESTRICTIONS

The prospectus presents the investment objective and the principal investment
strategies and risks of the fund. This section supplements the disclosure in the
fund's prospectus and provides additional information on the fund's investment
policies or restrictions. Restrictions or policies stated as a maximum
percentage of the fund's assets are only applied immediately after a portfolio
investment to which the policy or restriction is applicable (other than the
limitations on borrowing and illiquid securities). Accordingly, any later
increase or decrease resulting from a change in values, net assets or other
circumstances will not be considered in determining whether the investment
complies with the fund's restrictions and policies.

Primary Investments

Under normal circumstances, the fund invests at least 80% of its total assets in
common stocks and common stock equivalents of companies with market
capitalizations of $500 million or less. While micro-cap company securities may
offer a greater capital appreciation potential than investments in securities of
larger companies, they may also present greater risks. Micro-cap companies may
have limited product lines, market and financial resources, or may be dependent
on small or less experienced management groups. In addition, the trading volume
of micro-cap companies may be limited. Historically, the market price for
securities of micro-cap companies has been more volatile than for securities of
large-cap or mid-cap companies.

Illiquid Securities

The fund will not invest more than 15% of its net assets in illiquid and other
securities that are not readily marketable. Repurchase agreements maturing in
more than seven days will be included for purposes of the foregoing limit.
Securities subject to restrictions on resale under the Securities Act of 1933,
as amended (the "1933 Act"), are considered illiquid unless they are eligible
for resale pursuant to Rule 144A or another exemption from the registration
requirements of the 1933 Act and are determined to be liquid by Pioneer
Investment Management, Inc. ("Pioneer"), the fund's investment adviser. Pioneer
determines the liquidity of Rule 144A and other restricted securities according
to procedures adopted by the Board of Trustees. The Board of Trustees monitors
Pioneer's application of these guidelines and procedures. The inability of the
fund to dispose of illiquid investments readily or at reasonable prices could
impair the fund's ability to raise cash for redemptions or other purposes. If
the fund sold restricted securities other than pursuant to an exception from
registration under the 1933 Act such as Rule 144A, it may be deemed to be acting
as an underwriter and subject to liability under the 1933 Act.

Investments in Initial Public Offerings

To the extent consistent with its investment objective, the fund may invest in
initial public offerings of equity securities. The market for such securities
may be more volatile and entail greater risk of loss than investments in more
established companies. Investments in initial public offerings have represented
a significant portion of the fund's past investment performance. The fund cannot
assure that investments in

2
<PAGE>

initial public offerings will continue to be available to the fund or, if
available, will continue to result in positive investment performance. In
addition, as the fund grows in size, the impact of investments in initial public
offerings on the overall performance of the fund's portfolio is likely to
decrease.

Debt Securities Selection

In selecting fixed income securities for the fund, Pioneer gives primary
consideration to the fund's investment objective, the attractiveness of the
market for debt securities given Pioneer's outlook for the equity markets and
the fund's liquidity requirements. Once Pioneer determines to allocate a portion
of the fund's assets to debt securities, Pioneer generally focuses on short-term
instruments to provide liquidity and may invest in a range of fixed income
securities if the fund is investing in such instruments for income or capital
gains. Pioneer selects individual securities based on macroeconomic and issuer
specific factors including the terms of the securities (such as yields compared
to U.S. Treasuries or comparable issues), liquidity and rating, sector and
issuer diversification.

Convertible Debt Securities

The fund may invest in convertible debt securities which are debt obligations
convertible at a stated exchange rate or formula into common stock or other
equity securities of or owned by the issuer. Convertible securities rank senior
to common stocks in an issuer's capital structure and consequently may be of
higher quality and entail less risk than the issuer's common stock. As with all
debt securities, the market values of convertible securities tend to increase
when interest rates decline and, conversely, tend to decline when interest rates
increase.

Debt Securities Rating Criteria

Investment grade debt securities are those rated "BBB" or higher by Standard &
Poor's Ratings Group ("Standard & Poor's") or the equivalent rating of other
nationally recognized securities rating organizations. Debt securities rated BBB
are considered medium grade obligations with speculative characteristics, and
adverse economic conditions or changing circumstances may weaken the issuer's
ability to pay interest and repay principal. If the rating of an investment
grade debt security falls below investment grade, Pioneer will consider if any
action is appropriate in light of the fund's investment objective and policies.

Below investment grade debt securities are those rated "BB" and below by
Standard & Poor's or the equivalent rating of other nationally recognized
securities rating organizations. See Appendix B for a description of rating
categories. The fund may invest in debt securities rated "C" or better.

Below investment grade debt securities or comparable unrated securities are
commonly referred to as "junk bonds" and are considered predominantly
speculative and may be questionable as to principal and interest payments.
Changes in economic conditions are more likely to lead to a weakened capacity to
make principal payments and interest payments. The amount of junk bond
securities outstanding has proliferated as an increasing number of issuers have
used junk bonds for corporate financing. An economic downturn could severely
affect the ability of highly leveraged issuers to service their debt obligations
or to repay their obligations upon maturity. Factors having an adverse impact on
the market value of lower quality securities will have an adverse effect on the
fund's net asset value to the extent that it invests in such securities. In
addition, the fund may incur additional expenses to the extent it is required to
seek recovery upon a default in payment of principal or interest on its
portfolio holdings.

3
<PAGE>

The secondary market for junk bond securities may not be as liquid as the
secondary market for more highly rated securities, a factor which may have an
adverse effect on the fund's ability to dispose of a particular security when
necessary to meet its liquidity needs. Under adverse market or economic
conditions, the secondary market for junk bond securities could contract
further, independent of any specific adverse changes in the condition of a
particular issuer. As a result, the fund could find it more difficult to sell
these securities or may be able to sell the securities only at prices lower than
if such securities were widely traded. Prices realized upon the sale of such
lower rated or unrated securities, under these circumstances, may be less than
the prices used in calculating the fund's net asset value.

Since investors generally perceive that there are greater risks associated with
lower quality debt securities of the type in which the fund may invest a portion
of its assets, the yields and prices of such securities may tend to fluctuate
more than those for higher rated securities. In the lower quality segments of
the debt securities market, changes in perceptions of issuers' creditworthiness
tend to occur more frequently and in a more pronounced manner than do changes in
higher quality segments of the debt securities market, resulting in greater
yield and price volatility.

Lower rated and comparable unrated debt securities tend to offer higher yields
than higher rated securities with the same maturities because the historical
financial condition of the issuers of such securities may not have been as
strong as that of other issuers. However, lower rated securities generally
involve greater risks of loss of income and principal than higher rated
securities. Pioneer will attempt to reduce these risks through portfolio
diversification and by analysis of each issuer and its ability to make timely
payments of income and principal, as well as broad economic trends and corporate
developments.

Short-Term Investments

For temporary defensive or cash management purposes, the fund may invest in all
types of short-term investments including, but not limited to, corporate
commercial paper and other short-term commercial obligations issued by domestic
companies; obligations (including certificates of deposit, time deposits, demand
deposits and bankers' acceptances) of banks located in the U.S.; obligations
issued or guaranteed by the U.S. government or its agencies or
instrumentalities; and repurchase agreements.

Risks of Non-U.S. Investments

To the extent that the fund invests in the securities of non-U.S. issuers, those
investments involve considerations and risks not typically associated with
investing in the securities of issuers in the U.S. These risks are heightened
with respect to investments in countries with emerging markets and economies.
The risks of investing in securities of non-U.S. issuers or issuers with
significant exposure to non-U.S. markets may be related, among other things, to
(i) differences in size, liquidity and volatility of, and the degree and manner
of regulation of, the securities markets of certain non-U.S. markets compared to
the securities markets in the U.S.; (ii) economic, political and social factors;
and (iii) foreign exchange matters, such as restrictions on the repatriation of
capital, fluctuations in exchange rates between the U.S. dollar and the
currencies in which the fund's portfolio securities are quoted or denominated,
exchange control regulations and costs associated with currency exchange. The
political and economic structures in certain countries, particularly emerging
markets, are expected to undergo significant evolution and rapid development,
and such countries may lack the social, political and economic stability
characteristic of more developed countries. Unanticipated political or social
developments may affect the values of the fund's investments in such countries.
The economies and securities and currency markets of many

4
<PAGE>

emerging markets have experienced significant disruption and declines. There can
be no assurances that these economic and market disruptions will not continue.

Non-U.S. Securities Markets and Regulations. There may be less publicly
available information about non-U.S. markets and issuers than is available with
respect to U.S. securities and issuers. Non-U.S. companies generally are not
subject to accounting, auditing and financial reporting standards, practices and
requirements comparable to those applicable to U.S. companies. The trading
markets for most non-U.S. securities are generally less liquid and subject to
greater price volatility than the markets for comparable securities in the U.S.
The markets for securities in certain emerging markets are in the earliest
stages of their development. Even the markets for relatively widely traded
securities in certain non-U.S. markets, including emerging market countries, may
not be able to absorb, without price disruptions, a significant increase in
trading volume or trades of a size customarily undertaken by institutional
investors in the U.S. Additionally, market making and arbitrage activities are
generally less extensive in such markets, which may contribute to increased
volatility and reduced liquidity. The less liquid a market, the more difficult
it may be for the fund to price its portfolio securities accurately or to
dispose of such securities at the times determined by Pioneer to be appropriate.
The risks associated with reduced liquidity may be particularly acute in
situations in which the fund's operations require cash, such as in order to meet
redemptions and to pay its expenses.

Economic, Political and Social Factors. Certain countries, including emerging
markets, may be subject to a greater degree of economic, political and social
instability than is the case in the U.S. and Western European countries. Such
instability may result from, among other things: (i) authoritarian governments
or military involvement in political and economic decision making; (ii) popular
unrest associated with demands for improved economic, political and social
conditions; (iii) internal insurgencies; (iv) hostile relations with neighboring
countries; and (v) ethnic, religious and racial disaffection and conflict. Such
economic, political and social instability could significantly disrupt the
financial markets in such countries and the ability of the issuers in such
countries to repay their obligations. Investing in emerging market countries
also involves the risk of expropriation, nationalization, confiscation of assets
and property or the imposition of restrictions on foreign investments and on
repatriation of capital invested. In the event of such expropriation,
nationalization or other confiscation in any emerging country, the fund could
lose its entire investment in that country.

Certain emerging market countries restrict or control foreign investment in
their securities markets to varying degrees. These restrictions may limit the
fund's investment in those markets and may increase the expenses of the fund. In
addition, the repatriation of both investment income and capital from certain
markets in the region is subject to restrictions such as the need for certain
governmental consents. Even where there is no outright restriction on
repatriation of capital, the mechanics of repatriation may affect certain
aspects of the fund's operation.

Economies in individual countries may differ favorably or unfavorably from the
U.S. economy in such respects as growth of gross domestic product, rates of
inflation, currency valuation, capital reinvestment, resource self-sufficiency
and balance of payments positions. Many countries have experienced substantial,
and in some cases extremely high, rates of inflation for many years. Inflation
and rapid fluctuations in inflation rates have had, and may continue to have,
very negative effects on the economies and securities markets of certain
emerging countries.

Economies in emerging market countries generally are dependent heavily upon
international trade and, accordingly, have been and may continue to be affected
adversely by trade barriers, exchange controls,

5
<PAGE>

managed adjustments in relative currency values and other protectionist measures
imposed or negotiated by the countries with which they trade. These economies
also have been, and may continue to be, affected adversely by economic
conditions in the countries with which they trade.

Currency Risks. The value of the securities quoted or denominated in
international currencies may be adversely affected by fluctuations in the
relative currency exchange rates and by exchange control regulations. The fund's
investment performance may be negatively affected by a devaluation of a currency
in which the fund's investments are quoted or denominated. Further, the fund's
investment performance may be significantly affected, either positively or
negatively, by currency exchange rates because the U.S. dollar value of
securities quoted or denominated in another currency will increase or decrease
in response to changes in the value of such currency in relation to the U.S.
dollar.

Custodian Services and Related Investment Costs. Custodial services and other
costs relating to investment in international securities markets generally are
more expensive than in the U.S. Such markets have settlement and clearance
procedures that differ from those in the U.S. In certain markets there have been
times when settlements have been unable to keep pace with the volume of
securities transactions, making it difficult to conduct such transactions. The
inability of the fund to make intended securities purchases due to settlement
problems could cause the fund to miss attractive investment opportunities.
Inability to dispose of a portfolio security caused by settlement problems could
result either in losses to the fund due to a subsequent decline in value of the
portfolio security or could result in possible liability to the fund. In
addition, security settlement and clearance procedures in some emerging
countries may not fully protect the fund against loss or theft of its assets.

Withholding and Other Taxes. The fund will be subject to taxes, including
withholding taxes, on income (possibly including, in some cases, capital gains)
that are or may be imposed by certain countries with respect to the fund's
investments in such countries. These taxes will reduce the return achieved by
the fund. Treaties between the U.S. and such countries may not be available to
reduce the otherwise applicable tax rates.

Economic Monetary Union (EMU). On January 1, 1999, 11 European countries adopted
a single currency - the Euro. The conversion to the Euro is being phased in over
a three-year period. During this time, valuation, systems and other operational
problems may occur in connection with the fund's investments quoted in the Euro.
For participating countries, EMU will mean sharing a single currency and single
official interest rate and adhering to agreed upon limits on government
borrowing. Budgetary decisions will remain in the hands of each participating
country but will be subject to each country's commitment to avoid "excessive
deficits" and other more specific budgetary criteria. A European Central Bank is
responsible for setting the official interest rate to maintain price stability
within the Euro zone.

EMU is driven by the expectation of a number of economic benefits, including
lower transaction costs, reduced exchange risk, greater competition, and a
broadening and deepening of European financial markets. However, there are a
number of significant risks associated with EMU. Monetary and economic union on
this scale has never been attempted before. There is a significant degree of
uncertainty as to whether participating countries will remain committed to EMU
in the face of changing economic conditions. This uncertainty may increase the
volatility of European markets.

Real Estate Investment Trusts ("REITs") and Associated Risk Factors

REITs are pooled investment vehicles which invest primarily in income producing
real estate or real estate related loans or interests. REITs are generally
classified as equity REITs, mortgage REITs or a

6
<PAGE>

combination of equity and mortgage REITs. Equity REITs invest the majority of
their assets directly in real property and derive income primarily from the
collection of rents. Equity REITs can also realize capital gains by selling
properties that have appreciated in value. Mortgage REITs invest the majority of
their assets in real estate mortgages and derive income from the collection of
interest payments. REITs are not taxed on income distributed to shareholders
provided they comply with the applicable requirements of the Internal Revenue
Code of 1986, as amended (the "Code"). The fund will indirectly bear its
proportionate share of any management and other expenses paid by REITs in which
it invests in addition to the expenses paid by the fund.

Investing in REITs involves certain unique risks in addition to those risks
associated with investing in the real estate industry in general. An equity REIT
may be affected by changes in the value of the underlying properties owned by
the REIT. A mortgage REIT may be affected by changes in interest rates and the
ability of the issuers of its portfolio mortgages to repay their obligations.
REITs are dependent upon the skills of their managers and are not diversified.
REITs are generally dependent upon maintaining cash flows to repay borrowings
and to make distributions to shareholders and are subject to the risk of default
by lessees or borrowers. REITs whose underlying assets are concentrated in
properties used by a particular industry, such as health care, are also subject
to risks associated with such industry.

REITs (especially mortgage REITs) are also subject to interest rate risks. When
interest rates decline, the value of a REIT's investment in fixed rate
obligations can be expected to rise. Conversely, when interest rates rise, the
value of a REIT's investment in fixed rate obligations can be expected to
decline. If the REIT invests in adjustable rate mortgage loans the interest
rates on which are reset periodically, yields on a REIT's investments in such
loans will gradually align themselves to reflect changes in market interest
rates. This causes the value of such investments to fluctuate less dramatically
in response to interest rate fluctuations than would investments in fixed rate
obligations.

REITs may have limited financial resources, may trade less frequently and in a
limited volume and may be subject to more abrupt or erratic price movements than
larger company securities. Historically REITs have been more volatile in price
than the larger capitalization stocks included in Standard & Poor's 500 Stock
Index (the "S&P 500").

Other Investment Companies

The fund may invest in the securities of other investment companies to the
extent that such investments are consistent with the fund's investment objective
and policies and permissible under the Investment Company Act of 1940, as
amended (the "1940 Act"). Under the 1940 Act, the fund may not acquire the
securities of other domestic or non-U.S. investment companies if, as a result,
(i) more than 10% of the fund's total assets would be invested in securities of
other investment companies, (ii) such purchase would result in more than 3% of
the total outstanding voting securities of any one investment company being held
by the fund, or (iii) more than 5% of the fund's total assets would be invested
in any one investment company. These limitations do not apply to the purchase of
shares of any investment company in connection with a merger, consolidation,
reorganization or acquisition of substantially all the assets of another
investment company. The fund will not invest in other investment companies for
which Pioneer or any of its affiliates act as an investment adviser or
distributor.

The fund, as a holder of the securities of other investment companies, will bear
its pro rata portion of the other investment companies' expenses, including
advisory fees. These expenses are in addition to the direct expenses of the
fund's own operations.

7
<PAGE>

Repurchase Agreements

The fund may enter into repurchase agreements with broker-dealers, member banks
of the Federal Reserve System and other financial institutions. Repurchase
agreements are arrangements under which the fund purchases securities and the
seller agrees to repurchase the securities within a specific time and at a
specific price. The repurchase price is generally higher than the fund's
purchase price, with the difference being income to the fund. The Board of
Trustees reviews and monitors the creditworthiness of any institution which
enters into a repurchase agreement with the fund. The counterparty's obligations
under the repurchase agreement are collateralized with U.S. Treasury and/or
agency obligations with a market value of not less than 100% of the obligations,
valued daily. Collateral is held by the fund's custodian in a segregated,
safekeeping account for the benefit of the fund. Repurchase agreements afford
the fund an opportunity to earn income on temporarily available cash at low
risk. In the event of commencement of bankruptcy or insolvency proceedings with
respect to the seller of the security before repurchase of the security under a
repurchase agreement, the fund may encounter delay and incur costs before being
able to sell the security. Such a delay may involve loss of interest or a
decline in price of the security. If the court characterizes the transaction as
a loan and the fund has not perfected a security interest in the security, the
fund may be required to return the security to the seller's estate and be
treated as an unsecured creditor of the seller. As an unsecured creditor, the
fund would be at risk of losing some or all of the principal and interest
involved in the transaction.

Short Sales Against the Box

The fund may sell securities "short against the box." A short sale involves the
fund borrowing securities from a broker and selling the borrowed securities. The
fund has an obligation to return securities identical to the borrowed securities
to the broker. In a short sale against the box, the fund at all times owns an
equal amount of the security sold short or securities convertible into or
exchangeable for, with or without payment of additional consideration, an equal
amount of the security sold short. The fund intends to use short sales against
the box to hedge. For example, when the fund believes that the price of a
current portfolio security may decline, the fund may use a short sale against
the box to lock in a sale price for a security rather than selling the security
immediately. In such a case, any future losses in the fund's long position
should be offset by a gain in the short position and, conversely, any gain in
the long position should be reduced by a loss in the short position.

If the fund effects a short sale against the box at a time when it has an
unrealized gain on the security, it may be required to recognize that gain as if
it had actually sold the security (a "constructive sale") on the date it effects
the short sale. However, such constructive sale treatment may not apply if the
fund closes out the short sale with securities other than the appreciated
securities held at the time of the short sale provided that certain other
conditions are satisfied. Uncertainty regarding certain tax consequences of
effecting short sales may limit the extent to which the fund may make short
sales against the box.

Asset Segregation

The 1940 Act requires that the fund segregate assets in connection with certain
types of transactions that may have the effect of leveraging the fund's
portfolio. If the fund enters into a transaction requiring segregation, such as
a forward commitment, the custodian or Pioneer will segregate liquid assets in
an amount required to comply with the 1940 Act. Such segregated assets will be
valued at market daily. If

8
<PAGE>

the aggregate value of such segregated assets declines below the aggregate value
required to satisfy the 1940 Act, additional liquid assets will be segregated.

When-Issued and Delayed Delivery Securities

The fund may purchase securities, including U.S. government securities, on a
when-issued basis or may purchase or sell securities for delayed delivery. In
such transactions, delivery of the securities occurs beyond the normal
settlement period, but no payment or delivery is made by the fund prior to the
actual delivery or payment by the other party to the transaction. The fund will
not earn income on these securities until delivered. The purchase of securities
on a when-issued or delayed delivery basis involves the risk that the value of
the securities purchased will decline prior to the settlement date. The sale of
securities for delayed delivery involves the risk that the prices available in
the market on the delivery date may be greater than those obtained in the sale
transaction. When-issued and delayed delivery transactions will be fully
collateralized by segregated liquid assets. See "Asset Segregation."

Portfolio Turnover

It is the policy of the fund not to engage in trading for short-term profits
although portfolio turnover rate is not considered a limiting factor in the
execution of investment decisions for the fund. See Appendix A for the fund's
annual portfolio turnover rate.

Foreign Currency Transactions

The fund may engage in foreign currency transactions. These transactions may be
conducted at the prevailing spot rate for purchasing or selling currency in the
foreign exchange market. The fund also has authority to enter into forward
foreign currency exchange contracts involving currencies of the different
countries in which the fund invests as a hedge against possible variations in
the foreign exchange rates between these currencies and the U.S. dollar. This is
accomplished through contractual agreements to purchase or sell a specified
currency at a specified future date and price set at the time of the contract.

Transaction hedging is the purchase or sale of forward foreign currency
contracts with respect to specific receivables or payables of the fund, accrued
in connection with the purchase and sale of its portfolio securities quoted in
foreign currencies. Portfolio hedging is the use of forward foreign currency
contracts to offset portfolio security positions denominated or quoted in such
foreign currencies. There is no guarantee that the fund will be engaged in
hedging activities when adverse exchange rate movements occur. The fund will not
attempt to hedge all of its foreign portfolio positions and will enter into such
transactions only to the extent, if any, deemed appropriate by Pioneer.

Hedging against a decline in the value of a currency does not eliminate
fluctuations in the prices of portfolio securities or prevent losses if the
prices of such securities decline. Such transactions also limit the opportunity
for gain if the value of the hedged currency should rise. Moreover, it may not
be possible for the fund to hedge against a devaluation that is so generally
anticipated that the fund is not able to contract to sell the currency at a
price above the devaluation level it anticipates.

The cost to the fund of engaging in foreign currency transactions varies with
such factors as the currency involved, the size of the contract, the length of
the contract period, differences in interest rates between the two currencies
and the market conditions then prevailing. Since transactions in foreign
currency and forward contracts are usually conducted on a principal basis, no
fees or commissions are involved. The

9
<PAGE>

fund may close out a forward position in a currency by selling the forward
contract or by entering into an offsetting forward contract.

The precise matching of the forward contract amounts and the value of the
securities involved will not generally be possible because the future value of
such securities in foreign currencies will change as a consequence of market
movements in the value of those securities between the date on which the
contract is entered into and the date it matures. Using forward contracts to
protect the value of the fund's portfolio securities against a decline in the
value of a currency does not eliminate fluctuations in the underlying prices of
the securities. It simply establishes a rate of exchange which the fund can
achieve at some future point in time. The precise projection of short-term
currency market movements is not possible, and short-term hedging provides a
means of fixing the U.S. dollar value of only a portion of the fund's foreign
assets.

While the fund will enter into forward contracts to reduce currency exchange
rate risks, transactions in such contracts involve certain other risks. While
the fund may benefit from such transactions, unanticipated changes in currency
prices may result in a poorer overall performance for the fund than if it had
not engaged in any such transactions. Moreover, there may be imperfect
correlation between the fund's portfolio holdings of securities quoted or
denominated in a particular currency and forward contracts entered into by the
fund. Such imperfect correlation may cause the fund to sustain losses which will
prevent the fund from achieving a complete hedge or expose the fund to risk of
foreign exchange loss.

Over-the-counter markets for trading foreign forward currency contracts offer
less protection against defaults than is available when trading in currency
instruments on an exchange. Since a forward foreign currency exchange contract
is not guaranteed by an exchange or clearinghouse, a default on the contract
would deprive the fund of unrealized profits or force the fund to cover its
commitments for purchase or resale, if any, at the current market price.

If the fund enters into a forward contract to purchase foreign currency, the
custodian or Pioneer will segregate liquid assets. See "Asset Segregation."

Options on Foreign Currencies

The fund may purchase and write options on foreign currencies for hedging
purposes in a manner similar to that of transactions in forward contracts. For
example, a decline in the dollar value of a foreign currency in which portfolio
securities are quoted or denominated will reduce the dollar value of such
securities, even if their value in the foreign currency remains constant. In an
attempt to protect against such decreases in the value of portfolio securities,
the fund may purchase put options on the foreign currency. If the value of the
currency declines, the fund will have the right to sell such currency for a
fixed amount of dollars which exceeds the market value of such currency. This
would result in a gain that may offset, in whole or in part, the negative effect
of currency depreciation on the value of the fund's securities quoted or
denominated in that currency.

Conversely, if a rise in the dollar value of a currency is projected for those
securities to be acquired, thereby increasing the cost of such securities, the
fund may purchase call options on such currency. If the value of such currency
increases, the purchase of such call options would enable the fund to purchase
currency for a fixed amount of dollars which is less than the market value of
such currency. Such a purchase would result in a gain that may offset, at least
partially, the effect of any currency related

10
<PAGE>

increase in the price of securities the fund intends to acquire. As in the case
of other types of options transactions, however, the benefit the fund derives
from purchasing foreign currency options will be reduced by the amount of the
premium and related transaction costs. In addition, if currency exchange rates
do not move in the direction or to the extent anticipated, the fund could
sustain losses on transactions in foreign currency options which would deprive
it of a portion or all of the benefits of advantageous changes in such rates.

The fund may also write options on foreign currencies for hedging purposes. For
example, if the fund anticipated a decline in the dollar value of securities
quoted or denominated in a foreign currency because of declining exchange rates,
it could, instead of purchasing a put option, write a covered call option on the
relevant currency. If the expected decline occurs, the option will most likely
not be exercised, and the decrease in value of portfolio securities will be
partially offset by the amount of the premium received by the fund.

Similarly, the fund could write a put option on the relevant currency, instead
of purchasing a call option, to hedge against an anticipated increase in the
dollar cost of securities to be acquired. If exchange rates move in the manner
projected, the put option will expire unexercised and allow the fund to offset
such increased cost up to the amount of the premium. However, as in the case of
other types of options transactions, the writing of a foreign currency option
will constitute only a partial hedge up to the amount of the premium, only if
rates move in the expected direction. If unanticipated exchange rate
fluctuations occur, the option may be exercised and the fund would be required
to purchase or sell the underlying currency at a loss which may not be fully
offset by the amount of the premium. As a result of writing options on foreign
currencies, the fund also may be required to forego all or a portion of the
benefits which might otherwise have been obtained from favorable movements in
currency exchange rates.

A call option written on foreign currency by the fund is "covered" if the fund
owns the underlying foreign currency subject to the call, or if it has an
absolute and immediate right to acquire that foreign currency without additional
cash consideration. A call option is also covered if the fund holds a call on
the same foreign currency for the same principal amount as the call written
where the exercise price of the call held is (a) equal to or less than the
exercise price of the call written or (b) greater than the exercise price of the
call written if the amount of the difference is maintained by the fund in cash
or liquid securities. See "Asset Segregation."

The fund may close out its position in a currency option by either selling the
option it has purchased or entering into an offsetting option. An
exchange-traded options position may be closed out only on an options exchange
which provides a secondary market for an option of the same series. Although the
fund will generally purchase or write only those options for which there appears
to be an active secondary market, there is no assurance that a liquid secondary
market on an exchange will exist for any particular option, or at any particular
time. For some options no secondary market on an exchange may exist. In such
event, it might not be possible to effect closing transactions in particular
options, with the result that the fund would have to exercise its options in
order to realize any profit and would incur transaction costs upon the sale of
underlying currencies pursuant to the exercise of put options. If the fund as a
covered call option writer is unable to effect a closing purchase transaction in
a secondary market, it will not be able to sell the underlying currency (or
security quoted or denominated in that currency) until the option expires or it
delivers the underlying currency upon exercise.

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<PAGE>

The fund may purchase and write over-the-counter options to the extent
consistent with its limitation on investments in illiquid securities. Trading in
over-the-counter options is subject to the risk that the other party will be
unable or unwilling to close out options purchased or written by the fund.

Options on Securities and Securities Indices

The fund may purchase put and call options on any security in which it may
invest or options on any securities index based on securities in which it may
invest. The fund would also be able to enter into closing sale transactions in
order to realize gains or minimize losses on options it has purchased.

Writing Call and Put Options on Securities. A call option written by the fund
obligates the fund to sell specified securities to the holder of the option at a
specified price if the option is exercised at any time before the expiration
date. All call options written by the fund are covered, which means that the
fund will own the securities subject to the options as long as the options are
outstanding, or the fund will use the other methods described below. The fund's
purpose in writing covered call options is to realize greater income than would
be realized on portfolio securities transactions alone. However, the fund may
forego the opportunity to profit from an increase in the market price of the
underlying security.

A put option written by the fund would obligate the fund to purchase specified
securities from the option holder at a specified price if the option is
exercised at any time before the expiration date. All put options written by the
fund would be covered, which means that the fund would have segregated assets
with a value at least equal to the exercise price of the put option. The purpose
of writing such options is to generate additional income for the fund. However,
in return for the option premium, the fund accepts the risk that it may be
required to purchase the underlying security at a price in excess of its market
value at the time of purchase.

Call and put options written by the fund will also be considered to be covered
to the extent that the fund's liabilities under such options are wholly or
partially offset by its rights under call and put options purchased by the fund.
In addition, a written call option or put may be covered by entering into an
offsetting forward contract and/or by purchasing an offsetting option or any
other option which, by virtue of its exercise price or otherwise, reduces the
fund's net exposure on its written option position.

Writing Call and Put Options on Securities Indices. The fund may also write
(sell) covered call and put options on any securities index composed of
securities in which it may invest. Options on securities indices are similar to
options on securities, except that the exercise of securities index options
requires cash payments and does not involve the actual purchase or sale of
securities. In addition, securities index options are designed to reflect price
fluctuations in a group of securities or segments of the securities market
rather than price fluctuations in a single security.

The fund may cover call options on a securities index by owning securities whose
price changes are expected to be similar to those of the underlying index, or by
having an absolute and immediate right to acquire such securities without
additional cash consideration (or for additional consideration if cash in such
amount is segregated) upon conversion or exchange of other securities in its
portfolio. The fund may cover call and put options on a securities index with
segregated assets with a value equal to the exercise price.

Purchasing Call and Put Options. The fund would normally purchase call options
in anticipation of an increase in the market value of securities of the type in
which it may invest. The purchase of a call option

12
<PAGE>

would entitle the fund, in return for the premium paid, to purchase specified
securities at a specified price during the option period. The fund would
ordinarily realize a gain if, during the option period, the value of such
securities exceeded the sum of the exercise price, the premium paid and
transaction costs; otherwise the fund would realize either no gain or a loss on
the purchase of the call option.

The fund would normally purchase put options in anticipation of a decline in the
market value of securities in its portfolio ("protective puts") or in securities
in which it may invest. The purchase of a put option would entitle the fund, in
exchange for the premium paid, to sell specified securities at a specified price
during the option period. The purchase of protective puts is designed to offset
or hedge against a decline in the market value of the fund's securities. Put
options may also be purchased by the fund for the purpose of affirmatively
benefiting from a decline in the price of securities which it does not own. The
fund would ordinarily realize a gain if, during the option period, the value of
the underlying securities decreased below the exercise price sufficiently to
more than cover the premium and transaction costs; otherwise the fund would
realize either no gain or a loss on the purchase of the put option. Gains and
losses on the purchase of protective put options would tend to be offset by
countervailing changes in the value of the underlying portfolio securities.

The fund may terminate its obligations under an exchange-traded call or put
option by purchasing an option identical to the one it has written. Obligations
under over-the-counter options may be terminated only by entering into an
offsetting transaction with the counterparty to such option. Such purchases are
referred to as "closing purchase transactions."

Risks of Trading Options. There is no assurance that a liquid secondary market
on an options exchange will exist for any particular exchange-traded option, or
at any particular time. If the fund is unable to effect a closing purchase
transaction with respect to covered options it has written, the fund will not be
able to sell the underlying securities or dispose of its segregated assets until
the options expire or are exercised. Similarly, if the fund is unable to effect
a closing sale transaction with respect to options it has purchased, it will
have to exercise the options in order to realize any profit and will incur
transaction costs upon the purchase or sale of underlying securities.

Reasons for the absence of a liquid secondary market on an exchange include the
following: (i) there may be insufficient trading interest in certain options;
(ii) restrictions may be imposed by an exchange on opening or closing
transactions or both; (iii) trading halts, suspensions or other restrictions may
be imposed with respect to particular classes or series of options; (iv) unusual
or unforeseen circumstances may interrupt normal operations on an exchange; (v)
the facilities of an exchange or the Options Clearing Corporation (the "OCC")
may not at all times be adequate to handle current trading volume; or (vi) one
or more exchanges could, for economic or other reasons, decide or be compelled
at some future date to discontinue the trading of options (or a particular class
or series of options), in which event the secondary market on that exchange (or
in that class or series of options) would cease to exist, although outstanding
options on that exchange, if any, that had been issued by the OCC as a result of
trades on that exchange would continue to be exercisable in accordance with
their terms.

The fund may purchase and sell both options that are traded on U.S. and non-U.S.
exchanges and options traded over the counter with broker-dealers who make
markets in these options. The ability to terminate over-the-counter options is
more limited than with exchange-traded options and may involve the risk that
broker-dealers participating in such transactions will not fulfill their
obligations. Until such time as the staff of the Securities and Exchange
Commission (the "SEC") changes its position, the fund will treat purchased
over-the-counter options and all assets used to cover written over-the-counter
options as

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<PAGE>

illiquid securities, except that with respect to options written with primary
dealers in U.S. government securities pursuant to an agreement requiring a
closing purchase transaction at a formula price, the amount of illiquid
securities may be calculated with reference to the formula.

Transactions by the fund in options on securities and indices will be subject to
limitations established by each of the exchanges, boards of trade or other
trading facilities governing the maximum number of options in each class which
may be written or purchased by a single investor or group of investors acting in
concert. Thus, the number of options which the fund may write or purchase may be
affected by options written or purchased by other investment advisory clients of
Pioneer. An exchange, board of trade or other trading facility may order the
liquidations of positions found to be in excess of these limits, and it may
impose certain other sanctions.

The writing and purchase of options is a highly specialized activity which
involves investment techniques and risks different from those associated with
ordinary portfolio securities transactions. The successful use of protective
puts for hedging purposes depends in part on Pioneer's ability to predict future
price fluctuations and the degree of correlation between the options and
securities markets.

The hours of trading for options may not conform to the hours during which the
underlying securities are traded. To the extent that the options markets close
before the markets for the underlying securities, significant price movements
can take place in the underlying markets that cannot be reflected in the options
markets.

In addition to the risks of imperfect correlation between the fund's portfolio
and the index underlying the option, the purchase of securities index options
involves the risk that the premium and transaction costs paid by the fund in
purchasing an option will be lost. This could occur as a result of unanticipated
movements in the price of the securities comprising the securities index on
which the option is based.

Futures Contracts and Options on Futures Contracts

To hedge against changes in securities prices or currency exchange rates or to
seek to increase total return, the fund may purchase and sell various kinds of
futures contracts, and purchase and write (sell) call and put options on any of
such futures contracts. The fund may also enter into closing purchase and sale
transactions with respect to any of such contracts and options. The futures
contracts may be based on various securities (such as U.S. government
securities), securities indices, non-U.S. currencies and other financial
instruments and indices. Most securities indices are broader than the fund's
investment parameters. Accordingly, the fund will invest in securities index
futures that, in Pioneer's opinion, are as closely related to the investment
parameters of the fund as possible. The fund will engage in futures and related
options transactions for bona fide hedging and non-hedging purposes as described
below. All futures contracts entered into by the fund are traded on U.S.
exchanges or boards of trade that are licensed and regulated by the Commodity
Futures Trading Commission (the "CFTC") or on non-U.S. exchanges.

Futures Contracts. A futures contract may generally be described as an agreement
between two parties to buy and sell particular financial instruments for an
agreed price during a designated month (or to deliver the final cash settlement
price, in the case of a contract relating to an index or otherwise not calling
for physical delivery at the end of trading in the contract).

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<PAGE>

When interest rates are rising or securities prices are falling, the fund can
seek to offset a decline in the value of its current portfolio securities
through the sale of futures contracts. When interest rates are falling or
securities prices are rising, the fund, through the purchase of futures
contracts, can attempt to secure better rates or prices than might later be
available in the market when it effects anticipated purchases. Similarly, the
fund can sell futures contracts on a specified currency to protect against a
decline in the value of such currency and a decline in the value of its
portfolio securities which are denominated in such currency. The fund can
purchase futures contracts on a non-U.S. currency to establish the price in U.S.
dollars of a security denominated in such currency that the fund has acquired or
expects to acquire.

Positions taken in the futures markets are not normally held to maturity but are
instead liquidated through offsetting transactions which may result in a profit
or a loss. While futures contracts on securities or currency will usually be
liquidated in this manner, the fund may instead make, or take, delivery of the
underlying securities or currency whenever it appears economically advantageous
to do so. A clearing corporation associated with the exchange on which futures
on securities or currency are traded guarantees that, if still open, the sale or
purchase will be performed on the settlement date.

Hedging Strategies. Hedging, by use of futures contracts, seeks to establish
with more certainty the effective price, rate of return and currency exchange
rate on portfolio securities and securities that the fund owns or proposes to
acquire. The fund may, for example, take a "short" position in the futures
market by selling futures contracts in order to hedge against an anticipated
rise in interest rates or a decline in market prices or non-U.S. currency rates
that would adversely affect the value of the fund's portfolio securities. Such
futures contracts may include contracts for the future delivery of securities
held by the fund or securities with characteristics similar to those of the
fund's portfolio securities. Similarly, the fund may sell futures contracts in a
non-U.S. currency in which its portfolio securities are denominated or in one
currency to hedge against fluctuations in the value of securities denominated in
a different currency if there is an established historical pattern of
correlation between the two currencies. If, in the opinion of Pioneer, there is
a sufficient degree of correlation between price trends for the fund's portfolio
securities and futures contracts based on other financial instruments,
securities indices or other indices, the fund may also enter into such futures
contracts as part of its hedging strategies. Although under some circumstances
prices of securities in the fund's portfolio may be more or less volatile than
prices of such futures contracts, Pioneer will attempt to estimate the extent of
this volatility difference based on historical patterns and compensate for any
such differential by having the fund enter into a greater or lesser number of
futures contracts or by attempting to achieve only a partial hedge against price
changes affecting the fund's portfolio securities. When hedging of this
character is successful, any depreciation in the value of portfolio securities
will be substantially offset by appreciation in the value of the futures
position. On the other hand, any unanticipated appreciation in the value of the
fund's portfolio securities would be substantially offset by a decline in the
value of the futures position.

On other occasions, the fund may take a "long" position by purchasing futures
contracts. This may be done, for example, when the fund anticipates the
subsequent purchase of particular securities when it has the necessary cash, but
expects the prices or currency exchange rates then available in the applicable
market to be less favorable than prices or rates that are currently available.

Options on Futures Contracts. The acquisition of put and call options on futures
contracts will give the fund the right (but not the obligation) for a specified
price to sell or to purchase, respectively, the underlying futures contract at
any time during the option period. As the purchaser of an option on a futures
contract, the fund obtains the benefit of the futures position if prices move in
a favorable direction

15
<PAGE>

but limits its risk of loss in the event of an unfavorable price movement to the
loss of the premium and transaction costs.

The writing of a call option on a futures contract generates a premium which may
partially offset a decline in the value of the fund's assets. By writing a call
option, the fund becomes obligated, in exchange for the premium, to sell a
futures contract (if the option is exercised), which may have a value higher
than the exercise price. Conversely, the writing of a put option on a futures
contract generates a premium which may partially offset an increase in the price
of securities that the fund intends to purchase. However, the fund becomes
obligated to purchase a futures contract (if the option is exercised) which may
have a value lower than the exercise price. Thus, the loss incurred by the fund
in writing options on futures is potentially unlimited and may exceed the amount
of the premium received. The fund will incur transaction costs in connection
with the writing of options on futures.

The holder or writer of an option on a futures contract may terminate its
position by selling or purchasing an offsetting option on the same series. There
is no guarantee that such closing transactions can be effected. The fund's
ability to establish and close out positions on such options will be subject to
the development and maintenance of a liquid market.

Other Considerations. The fund will engage in futures and related options
transactions only for bona fide hedging or non-hedging purposes in accordance
with CFTC regulations which permit principals of an investment company
registered under the 1940 Act to engage in such transactions without registering
as commodity pool operators. The fund will determine that the price fluctuations
in the futures contracts and options on futures used for hedging purposes are
substantially related to price fluctuations in securities held by the fund or
which the fund expects to purchase. Except as stated below, the fund's futures
transactions will be entered into for traditional hedging purposes--i.e.,
futures contracts will be sold to protect against a decline in the price of
securities (or the currency in which they are denominated) that the fund owns,
or futures contracts will be purchased to protect the fund against an increase
in the price of securities (or the currency in which they are denominated) it
intends to purchase. As evidence of this hedging intent, the fund expects that
on 75% or more of the occasions on which it takes a long futures or option
position (involving the purchase of futures contracts), the fund will have
purchased, or will be in the process of purchasing, equivalent amounts of
related securities or assets denominated in the related currency in the cash
market at the time when the futures or option position is closed out. However,
in particular cases, when it is economically advantageous for the fund to do so,
a long futures position may be terminated or an option may expire without the
corresponding purchase of securities or other assets.

As an alternative to literal compliance with the bona fide hedging definition, a
CFTC regulation permits the fund to elect to comply with a different test, under
which the sum of the amounts of initial margin deposits on the fund's existing
non-hedging futures contracts and premiums paid for options on futures entered
into for non-hedging purposes (net of the amount the positions are "in the
money") would not exceed 5% of the market value of the fund's total assets. The
fund will engage in transactions in futures contracts and related options only
to the extent such transactions are consistent with the requirements of the Code
for maintaining its qualification as a regulated investment company for federal
income tax purposes.

Futures contracts and related options involve brokerage costs, require margin
deposits and, in the case of contracts and options obligating the fund to
purchase securities or currencies, require the fund to segregate assets to cover
such contracts and options.

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<PAGE>

While transactions in futures contracts and options on futures may reduce
certain risks, such transactions themselves entail certain other risks. Thus,
while the fund may benefit from the use of futures and options on futures,
unanticipated changes in interest rates, securities prices or currency exchange
rates may result in a poorer overall performance for the fund than if it had not
entered into any futures contracts or options transactions. In the event of an
imperfect correlation between a futures position and a portfolio position which
is intended to be protected, the desired protection may not be obtained and the
fund may be exposed to risk of loss. It is not possible to hedge fully or
perfectly against the effect of currency fluctuations on the value of non-U.S.
securities because currency movements impact the value of different securities
in differing degrees.

Warrants

The fund may invest in warrants, which are securities permitting, but not
obligating, their holder to subscribe for other securities. Warrants do not
carry with them the right to dividends or voting rights with respect to the
securities that they entitle their holders to purchase, and they do not
represent any rights in the assets of the issuer. As a result, an investment in
warrants may be considered more speculative than certain other types of
investments. In addition, the value of a warrant does not necessarily change
with the value of the underlying securities, and a warrant expires worthless if
it is not exercised on or prior to its expiration date.

Preferred Shares

The fund may invest in preferred shares of beneficial interest of trust
instruments. Preferred shares are equity securities, but they have many
characteristics of fixed income securities, such as a fixed dividend payment
rate and/or a liquidity preference over the issuer's common shares. However,
because preferred shares are equity securities, they may be more susceptible to
risks traditionally associated with equity investments than the fund's fixed
income securities.

Lending of Portfolio Securities

The fund may lend portfolio securities to member firms of the New York Stock
Exchange (the "Exchange") under agreements which require that the loans be
secured continuously by collateral in cash, cash equivalents or U.S. Treasury
bills maintained on a current basis at an amount at least equal to the market
value of the securities loaned. The fund continues to receive the equivalent of
the interest or dividends paid by the issuer on the securities loaned as well as
the benefit of an increase and the detriment of any decrease in the market value
of the securities loaned and would also receive compensation based on investment
of the collateral. The fund would not, however, have the right to vote any
securities having voting rights during the existence of the loan, but would call
the loan in anticipation of an important vote to be taken among holders of the
securities or of the giving or withholding of consent on a material matter
affecting the investment.

As with other extensions of credit, there are risks of delay in recovery or even
loss of rights in the collateral should the borrower of the securities fail
financially. The fund will lend portfolio securities only to firms that have
been approved in advance by the Board of Trustees, which will monitor the
creditworthiness of any such firms. At no time would the value of the securities
loaned exceed 30% of the value of the fund's total assets.

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<PAGE>

Investment Restrictions

The fund does not intend to enter into any reverse repurchase agreements or
dollar rolls or lend portfolio securities, as described in fundamental
investment restrictions (1), (2) and (6), during the coming year. In addition,
in compliance with an informal position taken by the staff of the SEC regarding
leverage, the fund will not purchase securities during the coming year at any
time that outstanding borrowings exceed 5% of the fund's total assets.

Fundamental Investment Restrictions. The fund has adopted certain investment
restrictions which, along with the fund's investment objective, may not be
changed without the affirmative vote of the holders of a "majority of the
outstanding voting securities" (as defined in the 1940 Act) of the fund. For
this purpose, a majority of the outstanding shares of the fund means the vote of
the lesser of:

(i) 67% or more of the shares represented at a meeting, if the holders of more
than 50% of the outstanding shares are present in person or by proxy, or

(ii) more than 50% of the outstanding shares of the fund.

The fund may not:

(1) Issue senior securities, except as permitted by the fund's borrowing,
lending and commodity restrictions and, for purposes of this restriction, the
issuance of shares of beneficial interest in multiple classes or series, the
purchase or sale of options, futures contracts and options on futures contracts,
forward commitments, forward foreign exchange contracts, repurchase agreements,
fully covered reverse repurchase agreements, dollar rolls, swaps and any other
financial transaction entered into pursuant to the fund's investment policies as
described in the prospectus and this statement of additional information and in
accordance with applicable SEC pronouncements, as well as the pledge, mortgage
or hypothecation of the fund's assets within the meaning of the fundamental
investment restriction regarding pledging, are not deemed to be senior
securities.

(2) Borrow money, except from banks as a temporary measure to facilitate the
meeting of redemption requests or for extraordinary emergency purposes and
except pursuant to reverse repurchase agreements and dollar rolls and then only
in amounts not to exceed 33 1/3% of the fund's total assets (including the
amount borrowed) taken at market value. The fund will not use leverage to
attempt to increase income.

(3) Guarantee the securities of any other company, or mortgage, pledge,
hypothecate or assign or otherwise encumber as security for indebtedness its
securities or receivables in an amount exceeding the amount of the borrowing
thereby secured.

(4) Act as an underwriter, except as it may be deemed to be an underwriter in a
sale of restricted securities held in its portfolio.

(5) Invest in real estate, commodities or commodity contracts, except that the
fund may invest in financial futures contracts and related options and in any
other financial instruments which may be deemed to be commodities or commodity
contracts in which the fund is not prohibited from investing by the Commodity
Exchange Act and the rules and regulations thereunder.

(6) Make loans, except by the purchase of debt obligations in which the fund may
invest consistent with its investment policies, by entering into repurchase
agreements or through the lending of portfolio

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<PAGE>

securities, in each case only to the extent permitted by the prospectus and this
statement of additional information.

(7) With respect to 75% of its total assets, purchase securities of an issuer
(other than the U.S. government, its agencies or instrumentalities), if

(a) such purchase would cause more than 5% of the fund's total assets, taken
at market value, to be invested in the securities of such issuer, or

(b) such purchase would at the time result in more than 10% of the
outstanding voting securities of such issuer being held by the fund.

It is the fundamental policy of the fund not to concentrate its investments in
securities of companies in any particular industry. A fund's investments are
concentrated in a particular industry if such investments aggregate 25% or more
of the fund's total assets. The fund's policy on industry concentration does not
apply to investments in U.S. government securities.

3. MANAGEMENT OF THE FUND

The fund's Board of Trustees provides broad supervision over the affairs of the
fund. The officers of the fund are responsible for the fund's operations. The
Trustees and executive officers of the fund are listed below, together with
their principal occupations during the past five years. An asterisk indicates
those Trustees who are interested persons of the fund within the meaning of the
1940 Act.

JOHN F. COGAN, JR.*, Chairman of the Board, President and Trustee, DOB: June
1926
President, Chief Executive Officer and a Director of The Pioneer Group,
Inc. ("PGI"); Chairman and a Director of Pioneer, Pioneer Funds Distributor,
Inc. ("PFD"), Pioneer Goldfields Limited, Teberebie Goldfields Limited, Closed
Joint-Stock Company "Amgun-Forest," Closed Joint-Stock Company "Udinskoye" and
Closed Joint-Stock Company "Tas-Yurjah" Mining Company; Director of Pioneer Real
Estate Advisors, Inc. ("PREA"), Pioneer Forest, Inc., Pioneer Management
(Ireland) Ltd. ("PMIL"), Pioneer First Investment Fund and Closed Joint-Stock
Company "Forest-Starma"; President and Director of Pioneer Metals and
Technology, Inc. ("PMT"), Pioneer International Corp. ("PIntl"), Pioneer First
Russia, Inc. and Pioneer Omega, Inc. ("Pioneer Omega"); Chairman of the
Supervisory Board of Pioneer Fonds Marketing, GmbH, Pioneer First Polish
Investment Fund Joint Stock Company, S.A. ("Pioneer First Polish") and Pioneer
Czech Investment Company, A.S. ("Pioneer Czech"); Member of the Supervisory
Board of Pioneer Universal Pension Fund Company; Chairman, President and Trustee
of all of the Pioneer mutual funds; Director of Pioneer Global Equity Fund Plc,
Pioneer Global Bond Fund Plc, Pioneer Euro Reserve Fund Plc, Pioneer European
Equity Fund Plc, Pioneer Emerging Europe Fund Plc, Pioneer US Real Estate Fund
Plc, Pioneer U.S. Growth Fund Plc, Pioneer Diversified Income Fund Plc and
Pioneer America Fund Plc (collectively, the "Irish Funds"); and Of Counsel, Hale
and Dorr LLP (counsel to PGI and the fund).

MARY K. BUSH, Trustee, DOB: April 1948
4201 Cathedral Avenue, NW, Washington, DC 20016
President, Bush & Co. (international financial advisory firm); Director and/or
Trustee of Mortgage Guaranty Insurance Corporation, Novecon Management Company,
Hoover Institution, Folger Shakespeare Library, March of Dimes, Project 2000,
Inc. (not-for-profit educational organization), Wilberforce University and
Texaco, Inc.; Advisory Board Member, Washington Mutual Investors Fund
(registered investment company); and Trustee of all of the Pioneer mutual funds,
except Pioneer Variable Contracts Trust.

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<PAGE>

RICHARD H. EGDAHL, M.D., Trustee, DOB: December 1926
Boston University Health Policy Institute, 53 Bay State Road, Boston, MA 02215
Alexander Graham Bell Professor of Health Care Entrepreneurship, Boston
University; Professor of Management, Boston University School of Management;
Professor of Public Health, Boston University School of Public Health; Professor
of Surgery, Boston University School of Medicine; University Professor, Boston
University; Director, Boston University Health Policy Institute, Boston
University Program for Health Care Entrepreneurship, CORE (management of
workers' compensation and disability costs - Nasdaq National Market), and
WellSpace (provider of complementary health care); Trustee, Boston Medical
Center; Honorary Trustee, Franciscan Children's Hospital; and Trustee of all of
the Pioneer mutual funds.

MARGARET B.W. GRAHAM, Trustee, DOB: May 1947
The Keep, P.O. Box 110, Little Deer Isle, ME 04650
Founding Director, The Winthrop Group, Inc. (consulting firm); Manager of
Research Operations, Xerox Palo Alto Research Center, from 1991 to 1994;
formerly Professor of Operations Management and Management of Technology and
Associate Dean, Boston University School of Management; and Trustee of all of
the Pioneer mutual funds, except Pioneer Variable Contracts Trust.

JOHN W. KENDRICK, Trustee, DOB: July 1917
6363 Waterway Drive, Falls Church, VA 22044
Professor Emeritus, George Washington University; Director, American
Productivity and Quality Center; Adjunct Scholar, American Enterprise Institute;
Economic Consultant; and Trustee of all of the Pioneer mutual funds, except
Pioneer Variable Contracts Trust.

MARGUERITE A. PIRET, Trustee, DOB: May 1948
One Boston Place, 26th Floor, Boston, MA 02108
President, Newbury, Piret & Company, Inc. (merchant banking firm); Trustee of
Boston Medical Center; Member of the Board of Governors of the Investment
Company Institute; Director, Organogenesis Inc. (tissue engineering company);
and Trustee of all of the Pioneer mutual funds.

DAVID D. TRIPPLE*, Trustee and Executive Vice President, DOB: February 1944
Executive Vice President and a Director of PGI; President and a Director of
Pioneer and PFD; Director of Pioneering Services Corporation ("PSC"), PIntl,
PREA, Pioneer Omega, PMIL, Pioneer First Investment Fund and the Irish Funds;
Member of the Supervisory Board of Pioneer First Polish and Pioneer Czech; and
Executive Vice President and Trustee of all of the Pioneer mutual funds.

STEPHEN K. WEST, Trustee, DOB: September 1928
125 Broad Street, New York, NY 10004
Of Counsel, Sullivan & Cromwell (law firm); Director, Kleinwort Benson
Australian Income Fund, Inc. since May 1997 and The Swiss Helvetia Fund, Inc.
since 1995 (investment companies), AMVESCAP PLC (investment managers) since 1997
and ING American Insurance Holdings, Inc; Trustee, The Winthrop Focus Funds
(investment companies); and Trustee of all of the Pioneer mutual funds.

JOHN WINTHROP, Trustee, DOB: June 1936
One North Adgers Wharf, Charleston, SC 29401
President, John Winthrop & Co., Inc. (private investment firm); Director of NUI
Corp. (energy sales, services and distribution); and Trustee of all of the
Pioneer mutual funds, except Pioneer Variable Contracts Trust.

ERIC W. RECKARD, Treasurer, DOB: June 1956
Executive Vice President, Chief Financial Officer and Treasurer of PGI since
June 1999; Treasurer of Pioneer, PFD, PSC, PIntl, PREA, PMT and Pioneer Omega
since June 1999; Vice President-Corporate

20
<PAGE>

Finance of PGI from February 1999 to June 1999; Manager of Business Planning and
Internal Audit of PGI since September 1996; Manager of Fund Accounting of
Pioneer since May 1994; Manager of Auditing, Compliance and Business Analysis
for PGI prior to May 1994; and Treasurer of all of the Pioneer mutual funds
(Assistant Treasurer prior to June 1999).

JOSEPH P. BARRI, Secretary, DOB: August 1946
Corporate Secretary of PGI and most of its subsidiaries; Secretary of all of the
Pioneer mutual funds; and Partner, Hale and Dorr LLP.

VINCENT NAVE, Assistant Treasurer, DOB: June 1945
Vice President-Fund Accounting, Administration and Custody Services of Pioneer
(Manager from September 1996 to February 1999); Senior Vice President of The
Boston Company's Investor Services Group prior to July 1994; and Assistant
Treasurer of all of the Pioneer mutual funds since June 1999.

ROBERT P. NAULT, Assistant Secretary, DOB: March 1964
Senior Vice President, General Counsel and Assistant Secretary of PGI since
1995; Assistant Secretary of Pioneer, certain other PGI subsidiaries and all of
the Pioneer mutual funds; Assistant Clerk of PFD and PSC; and junior partner of
Hale and Dorr LLP prior to 1995.

The business address of all officers is 60 State Street, Boston, Massachusetts
02109.

All of the outstanding capital stock of PFD, Pioneer and PSC is owned, directly
or indirectly, by PGI, a publicly owned Delaware corporation. Pioneer, the
fund's investment adviser, serves as the investment adviser for the Pioneer
mutual funds and manages the investments of certain institutional accounts.

The table below lists all of the U.S.-registered Pioneer mutual funds currently
offered to the public and the investment adviser and principal underwriter for
each fund.

Investment Principal
Fund Name Adviser Underwriter

Pioneer International Growth Fund Pioneer PFD
Pioneer Europe Fund Pioneer PFD
Pioneer World Equity Fund Pioneer PFD
Pioneer Emerging Markets Fund Pioneer PFD
Pioneer Indo-Asia Fund Pioneer PFD
Pioneer Mid-Cap Value Fund Pioneer PFD
Pioneer Mid-Cap Fund Pioneer PFD
Pioneer Growth Shares Pioneer PFD
Pioneer Small Company Fund Pioneer PFD
Pioneer Independence Fund Pioneer Note 1
Pioneer Micro-Cap Fund Pioneer PFD
Pioneer Balanced Fund Pioneer PFD
Pioneer Equity-Income Fund Pioneer PFD
Pioneer Fund Pioneer PFD
Pioneer II Pioneer PFD
Pioneer Real Estate Shares Pioneer PFD
Pioneer Limited Maturity Bond Fund Pioneer PFD

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<PAGE>

Pioneer America Income Trust Pioneer PFD
Pioneer Bond Fund Pioneer PFD
Pioneer Tax-Free Income Fund Pioneer PFD
Pioneer Cash Reserves Fund Pioneer PFD
Pioneer Strategic Income Fund Pioneer PFD
Pioneer Tax-Managed Fund Pioneer PFD
Pioneer High Yield Fund Pioneer PFD
Pioneer Interest Shares Pioneer Note 2
Pioneer Variable Contracts Trust Pioneer Note 3

Note 1 This fund is available to the general public only through Pioneer
Independence Plans, a systematic investment plan sponsored by PFD.

Note 2 This fund is a closed-end fund.

Note 3 This is a series of 13 separate portfolios designed to provide investment
vehicles for the variable annuity and variable life insurance contracts of
various insurance companies or for certain qualified pension plans.

Share Ownership

See Appendix A for annual information on the ownership of fund shares by the
Trustees, the fund's officers and owners in excess of 5% of any class of shares
of the fund.

Compensation of Officers and Trustees

The fund pays no salaries or compensation to any of its officers. The fund
compensates each Trustee who is not affiliated with PGI, Pioneer, PFD or PSC
with a base fee, a variable fee calculated on the basis of average net assets of
the fund, per meeting fees, and annual committee participation fees for each
committee member or chairperson that are based on percentages of his or her
aggregate annual fee. See the fee table in Appendix A.

Sales Loads. Current and former Trustees and officers of the fund and other
qualifying persons may purchase the fund's Class A shares without an initial
sales charge.

4. INVESTMENT ADVISER

The fund has contracted with Pioneer to act as its investment adviser. Pioneer
is a wholly owned subsidiary of PGI. PGI is engaged in the financial services
business in the U.S. and other countries. Certain Trustees or officers of the
fund are also directors and/or officers of PGI and its subsidiaries (see
management biographies above).

As the fund's investment adviser, Pioneer provides the fund with investment
research, advice and supervision and furnishes an investment program for the
fund consistent with the fund's investment objective and policies, subject to
the supervision of the fund's Trustees. Pioneer determines what portfolio
securities will be purchased or sold, arranges for the placing of orders for the
purchase or sale of portfolio securities, selects brokers or dealers to place
those orders, maintains books and records with

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<PAGE>

respect to the fund's securities transactions, and reports to the Trustees on
the fund's investments and performance.

Under the terms of its management contract with the fund, Pioneer pays all the
operating expenses, including executive salaries and the rental of office space
relating to its services for the fund, with the exception of the following,
which are paid by the fund: (a) charges and expenses for fund accounting,
pricing and appraisal services and related overhead, including, to the extent
such services are performed by personnel of Pioneer, or its affiliates, office
space and facilities and personnel compensation, training and benefits; (b) the
charges and expenses of auditors; (c) the charges and expenses of any custodian,
transfer agent, plan agent, dividend disbursing agent and registrar appointed by
the fund; (d) issue and transfer taxes chargeable to the fund in connection with
securities transactions to which the fund is a party; (e) insurance premiums,
interest charges, dues and fees for membership in trade associations and all
taxes and corporate fees payable by the fund to federal, state or other
governmental agencies; (f) fees and expenses involved in registering and
maintaining registrations of the fund and/or its shares with the SEC, state or
blue sky securities agencies and foreign countries, including the preparation of
prospectuses and statements of additional information for filing with the SEC;
(g) all expenses of shareholders' and Trustees' meetings and of preparing,
printing and distributing prospectuses, notices, proxy statements and all
reports to shareholders and to governmental agencies; (h) charges and expenses
of legal counsel to the fund and the Trustees; (i) distribution fees paid by the
fund in accordance with Rule 12b-1 promulgated by the SEC pursuant to the 1940
Act; (j) compensation of those Trustees of the fund who are not affiliated with
or interested persons of Pioneer, the fund (other than as Trustees), PGI or PFD;
(k) the cost of preparing and printing share certificates; and (l) interest on
borrowed money, if any. In addition, the fund shall pay all brokers' and
underwriting commissions chargeable to the fund in connection with securities
transactions to which the fund is a party. The Trustees' approval of and the
terms, continuance and termination of the management contract are governed by
the 1940 Act and the Investment Advisers Act of 1940, as applicable. Pursuant to
the management contract, Pioneer will not be liable for any error of judgment or
mistake of law or for any loss sustained by reason of the adoption of any
investment policy or the purchase, sale or retention of any securities on the
recommendation of Pioneer. Pioneer, however, is not protected against liability
by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties under the management contract.

Advisory Fee. As compensation for its management services and expenses incurred,
and certain expenses which Pioneer incurs on behalf of the fund, the fund pays
Pioneer an annual fee at the rate of 1.10% of the fund's average daily net
assets. The fee is normally computed and accrued daily and paid monthly.

See the table in Appendix A for management fees paid to Pioneer during recently
completed fiscal years.

Administration Agreement. The fund has entered into an administration agreement
with Pioneer pursuant to which certain accounting and legal services which are
expenses payable by the fund under the management contract are performed by
Pioneer and pursuant to which Pioneer is reimbursed for its costs of providing
such services. See Appendix A for fees the fund paid to Pioneer for
administration and related services.

Potential Conflict of Interest. The fund is managed by Pioneer which also serves
as investment adviser to other Pioneer mutual funds and private accounts with
investment objectives identical or similar to those of the fund. Securities
frequently meet the investment objectives of the fund, the other Pioneer

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<PAGE>

mutual funds and such private accounts. In such cases, the decision to recommend
a purchase to one fund or account rather than another is based on a number of
factors. The determining factors in most cases are the amount of securities of
the issuer then outstanding, the value of those securities and the market for
them. Other factors considered in the investment recommendations include other
investments which each fund or account presently has in a particular industry
and the availability of investment funds in each fund or account.

It is possible that at times identical securities will be held by more than one
fund and/or account. However, positions in the same issue may vary and the
length of time that any fund or account may choose to hold its investment in the
same issue may likewise vary. To the extent that more than one of the Pioneer
mutual funds or a private account managed by Pioneer seeks to acquire the same
security at about the same time, the fund may not be able to acquire as large a
position in such security as it desires or it may have to pay a higher price for
the security. Similarly, the fund may not be able to obtain as large an
execution of an order to sell or as high a price for any particular portfolio
security if Pioneer decides to sell on behalf of another account the same
portfolio security at the same time. On the other hand, if the same securities
are bought or sold at the same time by more than one fund or account, the
resulting participation in volume transactions could produce better executions
for the fund. In the event more than one account purchases or sells the same
security on a given date, the purchases and sales will normally be made as
nearly as practicable on a pro rata basis in proportion to the amounts desired
to be purchased or sold by each account. Although the other Pioneer mutual funds
may have the same or similar investment objectives and policies as the fund,
their portfolios do not generally consist of the same investments as the fund or
each other, and their performance results are likely to differ from those of the
fund.

Personal Securities Transactions. The fund, Pioneer and PFD have adopted a
code of ethics under Rule 17j-1 of the 1940 Act which is applicable to officers,
trustees/directors and designated employees. The code permits such persons to
engage in personal securities transactions for their own accounts, including
securities that may be purchased or held by the fund, and is designed to
prescribe means reasonably necessary to prevent conflicts of interest from
arising in connection with personal securities transactions. The code is on
public file with and available from the SEC.

5. PRINCIPAL UNDERWRITER AND DISTRIBUTION PLANS

Principal Underwriter

PFD, 60 State Street, Boston, Massachusetts 02109, is the principal underwriter
for the fund in connection with the continuous offering of its shares. PFD is an
indirect wholly owned subsidiary of PGI.

The fund entered into an underwriting agreement with PFD which provides that PFD
will bear expenses for the distribution of the fund's shares, except for
expenses incurred by PFD for which it is reimbursed or compensated by the fund
under the distribution plans (discussed below). PFD bears all expenses it incurs
in providing services under the underwriting agreement. Such expenses include
compensation to its employees and representatives and to securities dealers for
distribution-related services performed for the fund. PFD also pays certain
expenses in connection with the distribution of the fund's shares, including the
cost of preparing, printing and distributing advertising or promotional
materials, and the cost of printing and distributing prospectuses and
supplements to prospective shareholders. The fund bears the cost of registering
its shares under federal and state securities law and the laws of certain
non-U.S. countries. Under the underwriting agreement, PFD will use its best
efforts in rendering services to the fund.

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<PAGE>

See "Class A Share Sales Charges" for the schedule of initial sales charge
reallowed to dealers as a percentage of the offering price of the fund's Class A
shares.

See the tables in Appendix A for commissions retained by PFD and reallowed to
dealers in connection with PFD's offering of the fund's Class A shares during
recently completed fiscal years.

The fund will not generally issue fund shares for consideration other than cash.
At the fund's sole discretion, however, it may issue fund shares for
consideration other than cash in connection with a bona fide reorganization,
statutory merger or other acquisition of portfolio securities.

The redemption price of shares of beneficial interest of the fund may, at
Pioneer's discretion, be paid in cash or portfolio securities. The fund has,
however, elected to be governed by Rule 18f-1 under the 1940 Act pursuant to
which the fund is obligated to redeem shares solely in cash up to the lesser of
$250,000 or 1% of the fund's net asset value during any 90-day period for any
one shareholder. Should the amount of redemptions by any shareholder exceed such
limitation, the fund will have the option of redeeming the excess in cash or
portfolio securities. In the latter case, the securities are taken at their
value employed in determining the fund's net asset value. A shareholder whose
shares are redeemed in-kind may incur brokerage charges in selling the
securities received in-kind. The selection of such securities will be made in
such manner as the Board of Trustees deems fair and reasonable.

Distribution Plans

The fund has adopted a plan of distribution pursuant to Rule 12b-1 under the
1940 Act with respect to its Class A shares (the "Class A Plan") and a plan of
distribution with respect to its Class B shares (the "Class B Plan") (together,
the "Plans"), pursuant to which certain distribution and service fees are paid
to PFD. Because of the Plans, long-term shareholders may pay more than the
economic equivalent of the maximum sales charge permitted by the National
Association of Securities Dealers, Inc. (the "NASD") regarding investment
companies.

Class A Plan. Pursuant to the Class A Plan the fund reimburses PFD for its
actual expenditures to finance any activity primarily intended to result in the
sale of Class A shares or to provide services to holders of Class A shares,
provided the categories of expenses for which reimbursement is made are approved
by the Board of Trustees. The Board of Trustees has approved the following
categories of expenses that may be reimbursed under the Class A Plan: (i) a
service fee to be paid to qualified broker-dealers in an amount not to exceed
0.25% per annum of the fund's daily net assets attributable to Class A shares;
(ii) reimbursement to PFD for its expenditures for broker-dealer commissions and
employee compensation on certain sales of the fund's Class A shares with no
initial sales charge; and (iii) reimbursement to PFD for expenses incurred in
providing services to Class A shareholders and supporting broker-dealers and
other organizations (such as banks and trust companies) in their efforts to
provide such services. The expenses of the fund pursuant to the Class A Plan are
accrued daily at a rate which may not exceed the annual rate of 0.25% of the
fund's average daily net assets attributable to Class A shares. Distribution
expenses of PFD are expected to substantially exceed the distribution fees paid
by the fund in a given year.

The Class A Plan does not provide for the carryover of reimbursable expenses
beyond 12 months from the time the fund is first invoiced for an expense. The
limited carryover provision in the Class A Plan may result in an expense
invoiced to the fund in one fiscal year being paid in the subsequent fiscal year
and thus being treated for purposes of calculating the maximum expenditures of
the fund as having been

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<PAGE>

incurred in the subsequent fiscal year. In the event of termination or
non-continuance of the Class A Plan, the fund has 12 months to reimburse any
expense which it incurs prior to such termination or non-continuance, provided
that payments by the fund during such 12-month period shall not exceed 0.25% of
the fund's average daily net assets attributable to Class A shares during such
period. See Appendix A for the amount, if any, of carryover of distribution
expenses as of the end of the most recent calendar year.

Class B Plan. Commissions on the sale of Class B shares equal to 3.75% of the
amount invested are paid to broker-dealers who have sales agreements with PFD.
PFD may also advance to dealers the first-year service fee payable under the
Class B Plan at a rate up to 0.25% of the purchase price of such shares. As
compensation for such advance of the service fee, PFD may retain the service fee
paid by the fund with respect to such shares for the first year after purchase.

The Class B Plan provides that the fund shall pay PFD, as the fund's distributor
for its Class B shares, a daily distribution fee equal on an annual basis to
0.75% of the fund's average daily net assets attributable to Class B shares and
will pay PFD a service fee equal to 0.25% of the fund's average daily net assets
attributable to Class B shares (which PFD will in turn pay to securities dealers
which enter into a sales agreement with PFD at a rate of up to 0.25% of the
fund's average daily net assets attributable to Class B shares owned by
investors for whom that securities dealer is the holder or dealer of record).
This service fee is intended to be in consideration of personal services and/or
account maintenance services rendered by the dealer with respect to Class B
shares. Commencing in the 13th month following the purchase of Class B shares,
dealers will become eligible for additional annual service fees of up to 0.25%
of the net asset value of such shares. Dealers may from time to time be required
to meet certain other criteria in order to receive service fees. PFD or its
affiliates are entitled to retain all service fees payable under the Class B
Plan for which there is no dealer of record or for which qualification standards
have not been met as partial consideration for personal services and/or account
maintenance services performed by PFD or its affiliates for shareholder
accounts.

The purpose of distribution payments to PFD under the Class B Plan is to
compensate PFD for its distribution services with respect to Class B shares of
the fund. PFD pays commissions to dealers as well as expenses of printing
prospectuses and reports used for sales purposes, expenses with respect to the
preparation and printing of sales literature and other distribution-related
expenses, including, without limitation, the cost necessary to provide
distribution-related services, or personnel, travel, office expenses and
equipment. The Class B Plan also provides that PFD will receive all contingent
deferred sales charges ("CDSCs") attributable to Class B shares. When a
broker-dealer sells Class B shares and elects, with PFD's approval, to waive its
right to receive the commission normally paid at the time of the sale, PFD may
cause all or a portion of the distribution fees described above to be paid to
the broker-dealer.

The Class B Plan and underwriting agreement were amended effective September 30,
1998 to permit PFD to sell its right to receive distribution fees under the
Class B Plan and CDSCs to third parties. PFD enters into such transactions to
finance the payment of commissions to brokers at the time of sale and other
distribution-related expenses. In connection with such amendments, the fund has
agreed that the distribution fee will not be terminated or modified (including a
modification by change in the rules relating to the conversion of Class B shares
into Class A shares) with respect to Class B shares (a) issued prior to the date
of any termination or modification or (b) attributable to Class B shares issued
through one or a series of exchanges of shares of another investment company for
which PFD acts as principal underwriter which were initially issued prior to the
date of such termination or modification or (c) issued as a dividend or
distribution upon Class B shares initially issued or attributable to Class B
shares issued prior to the date of any such termination or modification except:

26
<PAGE>

(i) to the extent required by a change in the 1940 Act, the rules or
regulations under the 1940 Act, the Conduct Rules of the NASD or an order
of any court or governmental agency, in each case enacted, issued or
promulgated after September 30, 1998;

(ii) in connection with a Complete Termination (as defined in the Class B
Plan); or

(iii) on a basis, determined by the Board of Trustees acting in good faith, so
long as from and after the effective date of such modification or
termination: neither the fund, the adviser nor certain affiliates pay,
directly or indirectly, a fee to any person for the provision of personal
and account maintenance services (as such terms are used in the Conduct
Rules of the NASD) to the holders of Class B shares of the fund and the
termination or modification of the distribution fee applies with equal
effect to all Class B shares outstanding from time to time.

The Class B Plan also provides that PFD shall be deemed to have performed all
services required to be performed in order to be entitled to receive the
distribution fee, if any, payable with respect to Class B shares sold through
PFD upon the settlement date of the sale of such Class B shares or in the case
of Class B shares issued through one or a series of exchanges of shares of
another investment company for which PFD acts as principal underwriter or issued
as a dividend or distribution upon Class B shares, on the settlement date of the
first sale on a commission basis of a Class B share from which such Class B
share was derived.

In the amendments to the underwriting agreement, the fund agreed that subsequent
to the issuance of a Class B share, it would not take any action to waive or
change any CDSC (including a change in the rules applicable to conversion of
Class B shares into another class) in respect of such Class B shares, except (i)
as provided in the fund's prospectus or statement of additional information in
effect on September 30, 1998, or (ii) as required by a change in the 1940 Act
and the rules and regulations thereunder, the Conduct Rules of the NASD or any
order of any court or governmental agency enacted, issued or promulgated after
September 30, 1998.

General

In accordance with the terms of each Plan, PFD provides to the fund for review
by the Trustees a quarterly written report of the amounts expended under the
Plan and the purposes for which such expenditures were made. In the Trustees'
quarterly review of the Plans, they will consider the continued appropriateness
and the level of reimbursement or compensation the Plans provide.

No interested person of the fund, nor any Trustee of the fund who is not an
interested person of the fund, has any direct or indirect financial interest in
the operation of the Plans except to the extent that PFD and certain of its
employees may be deemed to have such an interest as a result of receiving a
portion of the amounts expended under the Plans by the fund and except to the
extent certain officers may have an interest in PFD's ultimate parent, PGI.

Each Plan's adoption, terms, continuance and termination are governed by Rule
12b-1 under the 1940 Act. The Board of Trustees believes that there is a
reasonable likelihood that the Plans will benefit the fund and its current and
future shareholders. The Plans may not be amended to increase materially the
annual percentage limitation of average net assets which may be spent for the
services described therein

27
<PAGE>

without approval of the shareholders of the fund affected thereby, and material
amendments of the Plans must also be approved by the Trustees as provided in
Rule 12b-1.

See Appendix A for fund expenses under the Class A Plan and Class B Plan and
CDSCs paid to PFD for the most recently completed fiscal year.

Upon redemption, Class A shares may be subject to a 1% CDSC and Class B shares
are subject to a CDSC at a rate declining from a maximum 4% of the lower of the
cost or market value of the shares.

6. SHAREHOLDER SERVICING/TRANSFER AGENT

The fund has contracted with PSC, 60 State Street, Boston, Massachusetts 02109,
to act as shareholder servicing and transfer agent for the fund.

Under the terms of its contract with the fund, PSC services shareholder
accounts, and its duties include: (i) processing sales, redemptions and
exchanges of shares of the fund; (ii) distributing dividends and capital gains
associated with the fund's portfolio; and (iii) maintaining account records and
responding to shareholder inquiries.

PSC receives an annual fee of $25.25 for each Class A and Class B shareholder
account from the fund as compensation for the services described above. PSC is
also reimbursed by the fund for its cash out-of-pocket expenditures. The fund
may compensate entities which have agreed to provide certain sub-accounting
services such as specific transaction processing and recordkeeping services. Any
such payments by the fund would be in lieu of the per account fee which would
otherwise be paid by the fund to PSC.

7. CUSTODIAN

Brown Brothers Harriman & Co., 40 Water Street, Boston, Massachusetts 02109, is
the custodian of the fund's assets. The custodian's responsibilities include
safekeeping and controlling the fund's cash and securities, handling the receipt
and delivery of securities, and collecting interest and dividends on the fund's
investments.

8. INDEPENDENT PUBLIC ACCOUNTANTS

Arthur Andersen LLP, 225 Franklin Street, Boston, Massachusetts 02110, the
fund's independent public accountants, provides audit services, tax return
review, and assistance and consultation with respect to the preparation of
filings with the SEC.

9. PORTFOLIO TRANSACTIONS

All orders for the purchase or sale of portfolio securities are placed on behalf
of the fund by Pioneer pursuant to authority contained in the fund's management
contract. Pioneer seeks to obtain the best execution on portfolio trades. The
price of securities and any commission rate paid are always factors, but
frequently not the only factors, in judging best execution. In selecting brokers
or dealers, Pioneer considers various relevant factors, including, but not
limited to, the size and type of the transaction; the nature and character of
the markets for the security to be purchased or sold; the execution efficiency,
settlement capability and financial condition of the dealer; the dealer's
execution services rendered on a

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continuing basis; and the reasonableness of any dealer spreads. Transactions in
non-U.S. equity securities are executed by broker-dealers in non-U.S. countries
in which commission rates may not be negotiable (as such rates are in the U.S.).

Pioneer may select broker-dealers that provide brokerage and/or research
services to the fund and/or other investment companies or other accounts managed
by Pioneer. In addition, consistent with Section 28(e) of the Securities
Exchange Act of 1934, as amended, if Pioneer determines in good faith that the
amount of commissions charged by a broker-dealer is reasonable in relation to
the value of the brokerage and research services provided by such broker, the
fund may pay commissions to such broker-dealer in an amount greater than the
amount another firm may charge. Such services may include advice concerning the
value of securities; the advisability of investing in, purchasing or selling
securities; the availability of securities or the purchasers or sellers of
securities; providing stock quotation services, credit rating service
information and comparative fund statistics; furnishing analyses, electronic
information services, manuals and reports concerning issuers, industries,
securities, economic factors and trends, portfolio strategy, and performance of
accounts and particular investment decisions; and effecting securities
transactions and performing functions incidental thereto (such as clearance and
settlement). Pioneer maintains a listing of broker-dealers who provide such
services on a regular basis. However, because many transactions on behalf of the
fund and other investment companies or accounts managed by Pioneer are placed
with broker-dealers (including broker-dealers on the listing) without regard to
the furnishing of such services, it is not possible to estimate the proportion
of such transactions directed to such dealers solely because such services were
provided. Pioneer believes that no exact dollar value can be calculated for such
services.

The research received from broker-dealers may be useful to Pioneer in rendering
investment management services to the fund as well as other investment companies
or other accounts managed by Pioneer, although not all such research may be
useful to the fund. Conversely, such information provided by brokers or dealers
who have executed transaction orders on behalf of such other accounts may be
useful to Pioneer in carrying out its obligations to the fund. The receipt of
such research has not reduced Pioneer's normal independent research activities;
however, it enables Pioneer to avoid the additional expenses which might
otherwise be incurred if it were to attempt to develop comparable information
through its own staff.

In circumstances where two or more broker-dealers offer comparable prices and
executions, preference may be given to a broker-dealer which has sold shares of
the fund as well as shares of other investment companies managed by Pioneer.
This policy does not imply a commitment to execute all portfolio transactions
through all broker-dealers that sell shares of the fund.

The Pioneer funds have entered into third-party brokerage and/or expense offset
arrangements to reduce the funds' total operating expenses. Pursuant to
third-party brokerage arrangements, certain of the funds that invest primarily
in U.S. equity securities may incur lower custody fees by directing brokerage to
third-party broker-dealers. Pursuant to expense offset arrangements, the funds
incur lower transfer agency expenses by maintaining their cash balances with the
custodian. See "Financial highlights" in the prospectus.

See the table in Appendix A for aggregate brokerage and underwriting commissions
paid by the fund in connection with its portfolio transactions during recently
completed fiscal years. The Board of Trustees periodically reviews Pioneer's
performance of its responsibilities in connection with the placement of
portfolio transactions on behalf of the fund.

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10. DESCRIPTION OF SHARES

As an open-end management investment company, the fund continuously offers its
shares to the public and under normal conditions must redeem its shares upon the
demand of any shareholder at the next determined net asset value per share less
any applicable CDSC. See "Sales Charges." When issued and paid for in accordance
with the terms of the prospectus and statement of additional information, shares
of the fund are fully paid and non-assessable. Shares will remain on deposit
with the fund's transfer agent and certificates will not normally be issued. The
fund reserves the right to charge a fee for the issuance of Class A share
certificates; certificates will not be issued for Class B shares.

The fund's Agreement and Declaration of Trust, dated December 3, 1996 (the
"Declaration"), permits the Board of Trustees to authorize the issuance of an
unlimited number of full and fractional shares of beneficial interest which may
be divided into such separate series as the Trustees may establish. Currently,
the fund consists of only one series. The Trustees may, however, establish
additional series of shares and may divide or combine the shares into a greater
or lesser number of shares without thereby changing the proportionate beneficial
interests in the fund. The Declaration further authorizes the Trustees to
classify or reclassify any series of the shares into one or more classes.
Pursuant thereto, the Trustees have authorized the issuance of Class A shares
and Class B shares. Each share of a class of the fund represents an equal
proportionate interest in the assets of the fund allocable to that class. Upon
liquidation of the fund, shareholders of each class of the fund are entitled to
share pro rata in the fund's net assets allocable to such class available for
distribution to shareholders. The fund reserves the right to create and issue
additional series or classes of shares, in which case the shares of each class
of a series would participate equally in the earnings, dividends and assets
allocable to that class of the particular series.

The shares of each class represent an interest in the same portfolio of
investments of the fund. Each class has equal rights as to voting, redemption,
dividends and liquidation, except that each class bears different distribution
and transfer agent fees and may bear other expenses properly attributable to the
particular class. Class A and Class B shareholders have exclusive voting rights
with respect to the Rule 12b-1 Plans adopted by holders of those shares in
connection with the distribution of shares.

Shareholders are entitled to one vote for each share held and may vote in the
election of Trustees and on other matters submitted to a meeting of
shareholders. Although Trustees are not elected annually by the shareholders,
shareholders have, under certain circumstances, the right to remove one or more
Trustees. The fund is not required, and does not intend, to hold annual
shareholder meetings although special meetings may be called for the purpose of
electing or removing Trustees, changing fundamental investment restrictions or
approving a management contract.

The shares of each series of the fund are entitled to vote separately to approve
investment advisory agreements or changes in investment restrictions, but
shareholders of all series vote together in the election and selection of
Trustees and accountants. Shares of all series of the fund vote together as a
class on matters that affect all series of the fund in substantially the same
manner. As to matters affecting a single series or class, shares of such series
or class will vote separately. No amendment adversely affecting the rights of
shareholders may be made to the Declaration without the affirmative vote of a
majority of the fund's shares. Shares have no preemptive or conversion rights,
except that under certain circumstances Class B shares may convert to Class A
shares.

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<PAGE>

As a Delaware business trust, the fund's operations are governed by the
Declaration. A copy of the fund's Certificate of Trust, dated December 4, 1996,
is on file with the office of the Secretary of State of Delaware. Generally,
Delaware business trust shareholders are not personally liable for obligations
of the Delaware business trust under Delaware law. The Delaware Business Trust
Act (the "Delaware Act") provides that a shareholder of a Delaware business
trust shall be entitled to the same limitation of liability extended to
shareholders of private for-profit corporations. The Declaration expressly
provides that the fund is organized under the Delaware Act and that the
Declaration is to be governed by Delaware law. There is nevertheless a
possibility that a Delaware business trust, such as the fund, might become a
party to an action in another state whose courts refused to apply Delaware law,
in which case the fund's shareholders could become subject to personal
liability.

To guard against this risk, the Declaration (i) contains an express disclaimer
of shareholder liability for acts or obligations of the fund and provides that
notice of such disclaimer may be given in each agreement, obligation or
instrument entered into or executed by the fund or its Trustees, (ii) provides
for the indemnification out of fund property of any shareholders held personally
liable for any obligations of the fund or any series of the fund and (iii)
provides that the fund shall, upon request, assume the defense of any claim made
against any shareholder for any act or obligation of the fund and satisfy any
judgment thereon. Thus, the risk of a shareholder incurring financial loss
beyond his or her investment because of shareholder liability is limited to
circumstances in which all of the following factors are present: (1) a court
refused to apply Delaware law; (2) the liability arose under tort law or, if
not, no contractual limitation of liability was in effect; and (3) the fund
itself would be unable to meet its obligations. In light of Delaware law, the
nature of the fund's business and the nature of its assets, the risk of personal
liability to a fund shareholder is remote.

In addition to the requirements under Delaware law, the Declaration provides
that a shareholder of the fund may bring a derivative action on behalf of the
fund only if the following conditions are met: (a) shareholders eligible to
bring such derivative action under Delaware law who hold at least 10% of the
outstanding shares of the fund, or 10% of the outstanding shares of the series
or class to which such action relates, shall join in the request for the
Trustees to commence such action; and (b) the Trustees must be afforded a
reasonable amount of time to consider such shareholder request and investigate
the basis of such claim. The Trustees shall be entitled to retain counsel or
other advisers in considering the merits of the request and shall require an
undertaking by the shareholders making such request to reimburse the fund for
the expense of any such advisers in the event that the Trustees determine not to
bring such action.

The Declaration further provides that the fund shall indemnify each of its
Trustees and officers against liabilities and expenses reasonably incurred by
them in connection with, or arising out of, any action, suit or proceeding,
threatened against or otherwise involving such Trustee or officer, directly or
indirectly, by reason of being or having been a Trustee or officer of the fund.
The Declaration does not authorize the fund to indemnify any Trustee or officer
against any liability to which he or she would otherwise be subject by reason of
or for willful misfeasance, bad faith, gross negligence or reckless disregard of
such person's duties.

The Declaration provides that any Trustee who is not an "interested person" of
Pioneer shall be considered to be independent for purposes of Delaware law
notwithstanding the fact that such Trustee receives compensation for serving as
a trustee of the fund or other investment companies for which Pioneer acts as
investment adviser.

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<PAGE>

11. SALES CHARGES

The fund continuously offers two classes of shares designated as Class A and
Class B shares as described in the prospectus.

Class A Share Sales Charges

You may buy Class A shares at the public offering price, including a sales
charge, as follows:

Sales Charge as a % of
Offering Net Amount Dealer
Amount of Purchase Price Invested Reallowance

Less than $50,000 5.75 6.10 5.00
$50,000 but less than $100,000 4.50 4.71 4.00
$100,000 but less than $250,000 3.50 3.63 3.00
$250,000 but less than $500,000 2.50 2.56 2.00
$500,000 but less than $1,000,000 2.00 2.04 1.75
$1,000,000 or more 0.00 0.00 see below

The schedule of sales charges above is applicable to purchases of Class A shares
of the fund by (i) an individual, (ii) an individual and his or her spouse and
children under the age of 21 and (iii) a trustee or other fiduciary of a trust
estate or fiduciary account or related trusts or accounts including pension,
profit-sharing and other employee benefit trusts qualified under Sections 401 or
408 of the Code although more than one beneficiary is involved. The sales
charges applicable to a current purchase of Class A shares of the fund by a
person listed above is determined by adding the value of shares to be purchased
to the aggregate value (at the then current offering price) of shares of any of
the other Pioneer mutual funds previously purchased and then owned, provided PFD
is notified by such person or his or her broker-dealer each time a purchase is
made which would qualify. Pioneer mutual funds include all mutual funds for
which PFD serves as principal underwriter. At the sole discretion of PFD,
holdings of funds domiciled outside the U.S., but which are managed by
affiliates of Pioneer, may be included for this purpose.

No sales charge is payable at the time of purchase on investments of $1 million
or more, or for purchases by participants in certain group plans described below
subject to a CDSC of 1% which may be imposed in the event of a redemption of
Class A shares within 12 months of purchase. PFD may, in its discretion, pay a
commission to broker-dealers who initiate and are responsible for such purchases
as follows: 1% on the first $5 million invested; 0.50% on the next $45 million
invested; and 0.25% on the excess over $50 million invested. These commissions
shall not be payable if the purchaser is affiliated with the broker-dealer or if
the purchase represents the reinvestment of a redemption made during the
previous 12 calendar months. Broker-dealers who receive a commission in
connection with Class A share purchases at net asset value by 401(a) or 401(k)
retirement plans with 1,000 or more eligible participants or with at least $10
million in plan assets will be required to return any commissions paid or a pro
rata portion thereof if the retirement plan redeems its shares within 12 months
of purchase. Contingent upon the achievement of certain sales objectives, PFD
may pay to Mutual of Omaha Investor Services, Inc. 50% of PFD's retention of any
sales commission on sales of the fund's Class A shares through such dealer. From
time to time, PFD may elect to reallow the entire initial sales charge to
participating dealers for all Class A sales with respect to which orders are
placed during a particular period. Dealers to whom substantially the entire
sales charge is reallowed may be deemed to be underwriters under the federal
securities laws.

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<PAGE>

PFD will reallow to participating broker/dealers the entire sales charge for all
sales of Class A shares of the above listed Pioneer mutual funds for orders
placed from March 1, 2000 through June 30, 2000. PFD will reallow to A.G.
Edwards & Sons, Inc. the entire sales charge for all sales of Class A shares of
any Pioneer mutual fund to IRA accounts if the order is placed from January 1,
2000 through April 17, 2000. PFD will reallow to Citicorp Investment Services
the entire sales charge for all Class A share sales of any Pioneer mutual fund
if the order is placed from March 1, 2000 through June 30, 2000.

Letter of Intent ("LOI"). Reduced sales charges are available for purchases of
$50,000 or more of Class A shares (excluding any reinvestments of dividends and
capital gain distributions) made within a 13-month period pursuant to an LOI
which may be established by completing the Letter of Intent section of the
Account Application. The reduced sales charge will be the charge that would be
applicable to the purchase of the specified amount of Class A shares as if the
shares had all been purchased at the same time. A purchase not made pursuant to
an LOI may be included if the LOI is submitted to PSC within 90 days of such
purchase. You may also obtain the reduced sales charge by including the value
(at current offering price) of all your Class A shares in the fund and all other
Pioneer mutual funds held of record as of the date of your LOI in the amount
used to determine the applicable sales charge for the Class A shares to be
purchased under the LOI. Five percent of your total intended purchase amount
will be held in escrow by PSC, registered in your name, until the terms of the
LOI are fulfilled. When you sign the Account Application, you agree to
irrevocably appoint PSC your attorney-in-fact to surrender for redemption any or
all shares held in escrow with full power of substitution. An LOI is not a
binding obligation upon the investor to purchase, or the fund to sell, the
amount specified in the LOI.

If the total purchases, less redemptions, exceed the amount specified under the
LOI and are in an amount which would qualify for a further quantity discount,
all transactions will be recomputed on the expiration date of the LOI to effect
the lower sales charge. Any difference in the sales charge resulting from such
recomputation will be either delivered to you in cash or invested in additional
shares at the lower sales charge. The dealer, by signing the Account
Application, agrees to return to PFD, as part of such retroactive adjustment,
the excess of the commission previously reallowed or paid to the dealer over
that which is applicable to the actual amount of the total purchases under the
LOI.

If the total purchases, less redemptions, are less than the amount specified
under the LOI, you must remit to PFD any difference between the sales charge on
the amount actually purchased and the amount originally specified in the LOI.
When the difference is paid, the shares held in escrow will be deposited to your
account. If you do not pay the difference in sales charge within 20 days after
written request from PFD or your dealer, PSC, after receiving instructions from
PFD, will redeem the appropriate number of shares held in escrow to realize the
difference and release any excess.

Class B Shares

You may buy Class B shares at the net asset value per share next computed after
receipt of a purchase order without the imposition of an initial sales charge;
however, Class B shares redeemed within six years of purchase will be subject to
a CDSC at the rates shown in the table below. The charge will be assessed on the
amount equal to the lesser of the current market value or the original purchase
cost of the shares being redeemed. No CDSC will be imposed on increases in
account value above the initial purchase price, including shares derived from
the reinvestment of dividends or capital gain distributions.

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<PAGE>

The amount of the CDSC, if any, will vary depending on the number of years from
the time of purchase until the time of redemption of Class B shares. For the
purpose of determining the number of years from the time of any purchase after
September 30, 1998, all payments during a month will be aggregated and deemed to
have been made on the first day of that month. For the purpose of determining
the number of years from the time of any purchase made prior to October 1, 1998,
all payments during a quarter will be aggregated and deemed to have been made on
the first day of that quarter. In processing redemptions of Class B shares, the
fund will first redeem shares not subject to any CDSC and then shares held
longest during the six-year period. As a result, you will pay the lowest
possible CDSC.

The CDSC for Class B shares subject to a CDSC upon redemption will be determined
as follows:

CDSC as a % of Dollar
Year Since Purchase Amount Subject to CDSC

First 4.0
Second 4.0
Third 3.0
Fourth 3.0
Fifth 2.0
Sixth 1.0
Seventh and thereafter 0.0

Proceeds from the CDSC are paid to PFD and are used in whole or in part to
defray PFD's expenses related to providing distribution-related services to the
fund in connection with the sale of Class B shares, including the payment of
compensation to broker-dealers.

Class B shares will automatically convert into Class A shares at the beginning
of the calendar month (or the calendar quarter for purchases made prior to
October 1, 1998) that is eight years after the purchase date, except as noted
below. Class B shares acquired by exchange from Class B shares of another
Pioneer mutual fund will convert into Class A shares based on the date of the
initial purchase and the applicable CDSC. Class B shares acquired through
reinvestment of distributions will convert into Class A shares based on the date
of the initial purchase to which such shares relate. For this purpose, Class B
shares acquired through reinvestment of distributions will be attributed to
particular purchases of Class B shares in accordance with such procedures as the
Trustees may determine from time to time. The conversion of Class B shares to
Class A shares is subject to the continuing availability of a ruling from the
Internal Revenue Service (the "IRS") or an opinion of counsel that such
conversions will not constitute taxable events for U.S. federal income tax
purposes. The conversion of Class B shares to Class A shares will not occur if
such ruling or opinion is not available and, therefore, Class B shares would
continue to be subject to higher expenses than Class A shares for an
indeterminate period.

12. REDEEMING SHARES

Redemptions may be suspended or payment postponed during any period in which any
of the following conditions exist: the Exchange is closed or trading on the
Exchange is restricted; an emergency exists as a result of which disposal by the
fund of securities owned by it is not reasonably practicable or it is not
reasonably practicable for the fund to fairly determine the value of the net
assets of its portfolio; or the SEC, by order, so permits.

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<PAGE>

Redemptions and repurchases are taxable transactions for shareholders that are
subject to U.S. federal income tax. The net asset value per share received upon
redemption or repurchase may be more or less than the cost of shares to an
investor, depending on the market value of the portfolio at the time of
redemption or repurchase.

Systematic Withdrawal Plan(s) ("SWP") (Class A and Class B Shares). A SWP is
designed to provide a convenient method of receiving fixed payments at regular
intervals from fund share accounts having a total value of not less than
$10,000. You must also be reinvesting all dividends and capital gain
distributions to use the SWP option.

Periodic payments of $50 or more will be deposited monthly, quarterly,
semiannually or annually directly into a bank account designated by the
applicant or will be sent by check to the applicant, or any person designated by
the applicant. Payments can be made either by check or electronic funds transfer
to a bank account designated by you. Class B accounts must meet the minimum
initial investment requirement prior to establishing a SWP. Withdrawals from
Class B share accounts are limited to 10% of the value of the account at the
time the SWP is established. See "Qualifying for a reduced sales charge" in the
prospectus. If you direct that withdrawal payments be paid to another person,
want to change the bank where payments are sent or designate an address that is
different from the account's address of record after you have opened your
account, a signature guarantee must accompany your instructions. Withdrawals
under the SWP are redemptions that may have tax consequences for you.

Purchases of Class A shares of the fund at a time when you have a SWP in effect
may result in the payment of unnecessary sales charges and may, therefore, be
disadvantageous. SWP redemptions reduce and may ultimately exhaust the number of
shares in your account. In addition, the amounts received by a shareholder
cannot be considered as yield or income on his or her investment because part of
such payments may be a return of his or her investment.

A SWP may be terminated at any time (1) by written notice to PSC or from PSC to
the shareholder; (2) upon receipt by PSC of appropriate evidence of the
shareholder's death; or (3) when all shares in the shareholder's account have
been redeemed.

You may obtain additional information by calling PSC at 1-800-225-6292.

Reinstatement Privilege (Class A Shares). If you redeem all or part of your
Class A shares of the fund, you may reinvest all or part of the redemption
proceeds without a sales charge in Class A shares of the fund if you send a
written request to PSC not more than 90 days after your shares were redeemed.
Your redemption proceeds will be reinvested at the next determined net asset
value of the Class A shares of the fund after receipt of the written request for
reinstatement. You may realize a gain or loss for federal income tax purposes as
a result of the redemption, and special tax rules may apply if a reinstatement
occurs. For example, if a redemption resulted in a loss and an investment is
made in shares of the fund within 30 days before or after the redemption, you
may not be able to recognize the loss for federal income tax purposes. Subject
to the provisions outlined in the prospectus, you may also reinvest in Class A
shares of other Pioneer mutual funds; in this case you must meet the minimum
investment requirements for each fund you enter.

The 90-day reinstatement period may be extended by PFD for periods of up to one
year for shareholders living in areas that have experienced a natural disaster,
such as a flood, hurricane, tornado or earthquake.

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<PAGE>

13. TELEPHONE TRANSACTIONS

You may purchase, exchange or sell Class A or Class B shares by telephone. See
the prospectus for more information. For personal assistance, call
1-800-225-6292 between 8:00 a.m. and 9:00 p.m. Eastern time on weekdays.
Computer-assisted transactions may be available to shareholders who have
prerecorded certain bank information (see "FactFone(SM)"). You are strongly
urged to consult with your investment professional prior to requesting any
telephone transaction.

To confirm that each transaction instruction received by telephone is genuine,
the fund will record each telephone transaction, require the caller to provide
the personal identification number ("PIN") for the account and send you a
written confirmation of each telephone transaction. Different procedures may
apply to accounts that are registered to non-U.S. citizens or that are held in
the name of an institution or in the name of an investment broker-dealer or
other third party. If reasonable procedures, such as those described above, are
not followed, the fund may be liable for any loss due to unauthorized or
fraudulent instructions. The fund may implement other procedures from time to
time. In all other cases, neither the fund, PSC nor PFD will be responsible for
the authenticity of instructions received by telephone; therefore, you bear the
risk of loss for unauthorized or fraudulent telephone transactions.

During times of economic turmoil or market volatility or as a result of severe
weather or a natural disaster, it may be difficult to contact the fund by
telephone to institute a purchase, exchange or redemption. You should
communicate with the fund in writing if you are unable to reach the fund by
telephone.

FactFone(SM). FactFone(SM) is an automated inquiry and telephone transaction
system available to Pioneer mutual fund shareholders by dialing 1-800-225-4321.
FactFone(SM) allows shareholder access to current information on Pioneer mutual
fund accounts and to the prices and yields of all publicly available Pioneer
mutual funds. In addition, you may use FactFone(SM) to make computer-assisted
telephone purchases, exchanges or redemptions from your Pioneer mutual fund
accounts, access your account balances and last three transactions and order a
duplicate statement if you have activated your PIN. Telephone purchases or
redemptions require the establishment of a bank account of record. You are
strongly urged to consult with your investment professional prior to requesting
any telephone transaction. Shareholders whose accounts are registered in the
name of a broker-dealer or other third party may not be able to use
FactFone(SM). Call PSC for assistance.

FactFone(SM) allows shareholders to hear the following recorded fund
information:

o net asset value prices for all Pioneer mutual funds;

o annualized 30-day yields on Pioneer's fixed income funds;

o annualized 7-day yields and 7-day effective (compound) yields for Pioneer's
money market fund; and

o dividends and capital gain distributions on all Pioneer mutual funds.

Yields are calculated in accordance with SEC mandated standard formulas.

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<PAGE>

All performance numbers communicated through FactFone(SM) represent past
performance, and figures include the maximum applicable sales charge. A
shareholder's actual yield and total return will vary with changing market
conditions. The value of Class A and Class B shares (except for Pioneer Cash
Reserves Fund, which seeks to maintain a stable $1.00 share price) will also
vary, and such shares may be worth more or less at redemption than their
original cost.

14. PRICING OF SHARES

The net asset value per share of each class of the fund is determined as of the
close of regular trading on the Exchange (normally 4:00 p.m. Eastern time) on
each day on which the Exchange is open for trading. As of the date of this
statement of additional information, the Exchange is open for trading every
weekday except for the following holidays: New Year's Day, Martin Luther King,
Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving Day and Christmas Day. The net asset value per share of each
class of the fund is also determined on any other day on which the level of
trading in its portfolio securities is sufficiently high that the current net
asset value per share might be materially affected by changes in the value of
its portfolio securities. The fund is not required to determine its net asset
value per share on any day on which no purchase orders in good order for fund
shares are received and no shares are tendered and accepted for redemption.

Securities are valued at the last sale price on the principal exchange or market
where they are traded. Securities which have not traded on the date of valuation
or securities for which sales prices are not generally reported are valued at
the mean between the current bid and asked prices. Securities quoted in non-U.S.
currencies are converted to U.S. dollars utilizing non-U.S. exchange rates
employed by the fund's independent pricing services. Generally, trading in
non-U.S. securities is substantially completed each day at various times prior
to the close of regular trading on the Exchange. The values of such securities
used in computing the net asset value of the fund's shares are determined as of
such times. Foreign currency exchange rates are also generally determined prior
to the close of regular trading on the Exchange. Occasionally, events which
affect the values of such securities and such exchange rates may occur between
the times at which they are determined and the close of regular trading on the
Exchange and will therefore not be reflected in the computation of the fund's
net asset value. If events materially affecting the value of such securities
occur during such period, then these securities may be valued at their fair
value as determined in good faith by the Trustees. All assets of the fund for
which there is no other readily available valuation method are valued at their
fair value as determined in good faith by the Trustees, although the actual
computations may be made by persons acting pursuant to the direction of the
Board of Trustees.

The net asset value per share of each class of the fund is computed by taking
the value of all of the fund's assets attributable to a class, less the fund's
liabilities attributable to that class, and dividing the result by the number of
outstanding shares of that class. For purposes of determining net asset value,
expenses of the classes of the fund are accrued daily and taken into account.
The fund's maximum offering price per Class A share is determined by adding the
maximum sales charge to the net asset value per Class A share. Class B shares
are offered at net asset value without the imposition of an initial sales charge
(but may be subject to a CDSC).

15. TAX STATUS

The fund has elected to be treated, has qualified and intends to qualify each
year as a "regulated investment company" under Subchapter M of the Code so that
it will not pay U.S. federal income tax on

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<PAGE>

income and capital gains distributed to shareholders. If the fund did not
qualify as a regulated investment company, it would be treated as a U.S.
corporation subject to U.S. federal income tax. Under the Code, the fund will be
subject to a nondeductible 4% federal excise tax on a portion of its
undistributed ordinary income and capital gains if it fails to meet certain
distribution requirements with respect to each calendar year. The fund intends
to make distributions in a timely manner and accordingly does not expect to be
subject to the excise tax.

The fund generally distributes any net short- and long-term capital gains in
November. The fund generally pays dividends from any net investment income in
December. Dividends from income and/or capital gains may also be paid at such
other times as may be necessary for the fund to avoid U.S. federal income or
excise tax.

In order to qualify as a regulated investment company under Subchapter M, the
fund must, among other things, derive at least 90% of its gross income for each
taxable year from dividends, interest, payments with respect to securities
loans, gains from the sale or other disposition of stock, securities or foreign
currencies, or other income (including gains from options, futures and forward
contracts) derived with respect to its business of investing in such stock,
securities or currencies (the "90% income test") and satisfy certain annual
distribution and quarterly diversification requirements. For purposes of the 90%
income test, the character of income earned by certain entities in which the
fund invests that are not treated as corporations (e.g., partnerships or trusts)
for U.S. tax purposes will generally pass through to the fund. Consequently, the
fund may be required to limit its equity investments in such entities that earn
fee income, rental income or other nonqualifying income.

Unless shareholders specify otherwise, all distributions will be automatically
reinvested in additional full and fractional shares of the fund. For U.S.
federal income tax purposes, all dividends are taxable whether a shareholder
takes them in cash or reinvests them in additional shares of the fund. Dividends
from investment company taxable income, which includes net investment income,
net short-term capital gain in excess of net long-term capital loss and certain
net foreign exchange gains, are taxable as ordinary income. Dividends from net
long-term capital gain in excess of net short-term capital loss ("net capital
gain"), if any, are taxable to the fund's shareholders as long-term capital
gains for U.S. federal income tax purposes without regard to the length of time
the shareholder has held shares of the fund. The U.S. federal income tax status
of all distributions will be reported to shareholders annually.

Any dividend declared by the fund as of a record date in October, November or
December and paid during the following January will be treated for U.S. federal
income tax purposes as received by shareholders on December 31 of the calendar
year in which it is declared.

Foreign exchange gains and losses realized by the fund in connection with
certain transactions involving foreign currency-denominated debt securities,
certain options and futures contracts relating to foreign currency, foreign
currency forward contracts, foreign currencies, or payables or receivables
denominated in a foreign currency are subject to Section 988 of the Code, which
generally causes such gains and losses to be treated as ordinary income and
losses and may affect the amount, timing and character of distributions to
shareholders. Under future regulations, any such transactions that are not
directly related to the fund's investments in stock or securities (or its
options contracts or futures contracts with respect to stock or securities) may
have to be limited in order to enable the fund to satisfy the 90% income test.
If the net foreign exchange loss for a year were to exceed the fund's investment
company taxable income (computed without regard to such loss), the resulting
ordinary loss for such year would not be deductible by the fund or its
shareholders in future years.

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<PAGE>

If the fund acquires any equity interest (under future regulations, generally
including not only stock but also an option to acquire stock such as is inherent
in a convertible bond) in certain foreign corporations that receive at least 75%
of their annual gross income from passive sources (such as interest, dividends,
certain rents and royalties, or capital gains) or that hold at least 50% of
their assets in investments producing such passive income ("passive foreign
investment companies"), the fund could be subject to U.S. federal income tax and
additional interest charges on "excess distributions" received from such
companies or on gain from the sale of stock in such companies, even if all
income or gain actually received by the fund is timely distributed to its
shareholders. The fund would not be able to pass through to its shareholders any
credit or deduction for such a tax. An election may generally be available that
would ameliorate these adverse tax consequences, but any such election could
require the fund to recognize taxable income or gain (subject to tax
distribution requirements) without the concurrent receipt of cash. These
investments could also result in the treatment of associated capital gains as
ordinary income. The fund may limit and/or manage its holdings in passive
foreign investment companies to limit its tax liability or maximize its return
from these investments.

The fund may invest to a limited extent in debt obligations that are in the
lowest rating categories or are unrated, including debt obligations of issuers
not currently paying interest or who are in default. Investments in debt
obligations that are at risk of or in default present special tax issues for the
fund. Tax rules are not entirely clear about issues such as when the fund may
cease to accrue interest, original issue discount or market discount, when and
to what extent deductions may be taken for bad debts or worthless securities,
how payments received on obligations in default should be allocated between
principal and income and whether exchanges of debt obligations in a workout
context are taxable. These and other issues will be addressed by the fund, in
the event it invests in such securities, in order to seek to ensure that it
distributes sufficient income to preserve its status as a regulated investment
company and does not become subject to U.S. federal income or excise tax.

If the fund invests in certain pay-in-kind securities, zero coupon securities,
deferred interest securities or, in general, any other securities with original
issue discount (or with market discount if the fund elects to include market
discount in income currently), the fund must accrue income on such investments
for each taxable year, which generally will be prior to the receipt of the
corresponding cash payments. However, the fund must distribute, at least
annually, all or substantially all of its net income, including such accrued
income, to shareholders to qualify as a regulated investment company under the
Code and avoid U.S. federal income and excise taxes. Therefore, the fund may
have to dispose of its portfolio securities under disadvantageous circumstances
to generate cash, or may have to leverage itself by borrowing the cash, to
satisfy distribution requirements.

For U.S. federal income tax purposes, the fund is permitted to carry forward a
net capital loss for any year to offset its capital gains, if any, during the
eight years following the year of the loss. To the extent subsequent capital
gains are offset by such losses, they would not result in U.S. federal income
tax liability to the fund and are not expected to be distributed as such to
shareholders. See Appendix A for the fund's available capital loss
carryforwards.

At the time of an investor's purchase of fund shares, a portion of the purchase
price may be attributable to realized or unrealized appreciation in the fund's
portfolio or undistributed taxable income of the fund. Consequently, subsequent
distributions by the fund with respect to these shares from such appreciation or
income may be taxable to such investor even if the net asset value of the
investor's shares is, as a result of

39
<PAGE>

the distributions, reduced below the investor's cost for such shares and the
distributions economically represent a return of a portion of the investment.

Redemptions and exchanges are taxable events for shareholders that are subject
to tax. Shareholders should consult their own tax advisers with reference to
their individual circumstances to determine whether any particular transaction
in fund shares is properly treated as a sale for tax purposes, as the following
discussion assumes, and the tax treatment of any gains or losses recognized in
such transactions. Any loss realized by a shareholder upon the redemption,
exchange or other disposition of shares with a tax holding period of six months
or less will be treated as a long-term capital loss to the extent of any amounts
treated as distributions of long-term capital gain with respect to such shares.

In addition, if Class A shares redeemed or exchanged have been held for less
than 91 days, (1) in the case of a reinvestment in the fund or another mutual
fund at net asset value pursuant to the reinstatement privilege, or (2) in the
case of an exchange, all or a portion of the sales charge paid on such shares is
not included in their tax basis under the Code to the extent a sales charge that
would otherwise apply to the shares received is reduced pursuant to the
reinstatement or exchange privilege. In either case, the portion of the sales
charge not included in the tax basis of the shares redeemed or surrendered in an
exchange is included in the tax basis of the shares acquired in the reinvestment
or exchange. Losses on redemptions or other dispositions of shares may be
disallowed under "wash sale" rules in the event of other investments in the fund
(including those made pursuant to reinvestment of dividends and/or capital gain
distributions) within a period of 61 days beginning 30 days before and ending 30
days after a redemption or other disposition of shares. In such a case, the
disallowed portion of any loss generally would be included in the federal tax
basis of the shares acquired in the other investments.

Options written or purchased and futures contracts entered into by the fund on
certain securities, indices and foreign currencies, as well as certain forward
foreign currency contracts, may cause the fund to recognize gains or losses from
marking-to-market even though such options may not have lapsed, been closed out,
or exercised, or such futures or forward contracts may not have been performed
or closed out. The tax rules applicable to these contracts may affect the
characterization of some capital gains and losses realized by the fund as
long-term or short-term. Certain options, futures and forward contracts relating
to foreign currency may be subject to Section 988, as described above, and
accordingly may produce ordinary income or loss. Additionally, the fund may be
required to recognize gain if an option, futures contract, forward contract,
short sale or other transaction that is not subject to the mark-to-market rules
is treated as a "constructive sale" of an "appreciated financial position" held
by the fund under Section 1259 of the Code. Any net mark-to-market gains and/or
gains from constructive sales may also have to be distributed to satisfy the
distribution requirements referred to above even though the fund may receive no
corresponding cash amounts received, possibly requiring the disposition of
portfolio securities or borrowing to obtain the necessary cash. Losses on
certain options, futures or forward contracts and/or offsetting positions
(portfolio securities or other positions with respect to which the fund's risk
of loss is substantially diminished by one or more options, futures or forward
contracts) may also be deferred under the tax straddle rules of the Code, which
may also affect the characterization of capital gains or losses from straddle
positions and certain successor positions as long-term or short-term. Certain
tax elections may be available that would enable the fund to ameliorate some
adverse effects of the tax rules described in this paragraph. The tax rules
applicable to options, futures, forward contracts and straddles may affect the
amount, timing and character of the fund's income and capital gains or losses
and hence of its distributions to shareholders.

40
<PAGE>

Dividends received by the fund from U.S. corporations in respect of any share of
stock with a tax holding period of at least 46 days (91 days in the case of
certain preferred stock) extending before and after each dividend held in an
unleveraged position and distributed and designated by the fund
dividends.(except for capital gain dividends received from a regulated
investment company) may be eligible for the 70% dividends-received deduction
generally available to corporations under the Code. Any corporate shareholder
should consult its tax adviser regarding the possibility that its tax basis in
its shares may be reduced, for federal income tax purposes, by reason of
"extraordinary dividends" received with respect to the shares and, to the extent
such basis would be reduced below zero, current recognition of income may be
required. In order to qualify for the deduction, corporate shareholders must
meet the minimum holding period requirement stated above with respect to their
fund shares, taking into account any holding period reductions from certain
hedging or other transactions or positions that diminish their risk of loss with
respect to their fund shares, and, if they borrow to acquire or otherwise incur
debt attributable to fund shares, they may be denied a portion of the
dividends-received deduction. The entire dividend, including the otherwise
deductible amount, will be included in determining the excess, if any, of a
corporation's adjusted current earnings over its alternative minimum taxable
income, which may increase a corporation's alternative minimum tax liability.

The fund may be subject to withholding and other taxes imposed by countries
other than the U.S., including taxes on interest, dividends and capital gains
with respect to its investments in those countries, which would, if imposed,
reduce the yield on or return from those investments. Tax conventions between
certain countries and the U.S. may reduce or eliminate such taxes in some cases.
The fund does not expect to satisfy the requirements for passing through to its
shareholders their pro rata shares of qualified foreign taxes paid by the fund,
with the result that shareholders will not include such taxes in their gross
incomes and will not be entitled to a tax deduction or credit for such taxes on
their own tax returns. The fund, however, generally may deduct any foreign taxes
that are not passed through to its shareholders in computing its income
available for distribution to shareholders to satisfy applicable tax
distribution requirements.

Different tax treatment, including penalties on certain excess contributions and
deferrals, certain pre-retirement and post-retirement distributions and certain
prohibited transactions, is accorded to accounts maintained as qualified
retirement plans. Shareholders should consult their tax advisers for more
information.

Federal law requires that the fund withhold (as "backup withholding") 31% of
reportable payments, including dividends, capital gain distributions and the
proceeds of redemptions (and exchanges) or repurchases of fund shares, paid to
shareholders who have not complied with IRS regulations. In order to avoid this
withholding requirement, shareholders must certify on their Account
Applications, or on separate IRS Forms W-9, that the Social Security Number or
other Taxpayer Identification Number they provide is their correct number and
that they are not currently subject to backup withholding, or that they are
exempt from backup withholding. The fund may nevertheless be required to
withhold if it receives notice from the IRS or a broker that the number provided
is incorrect or backup withholding is applicable as a result of previous
underreporting of interest or dividend income.

If, as anticipated, the fund continues to qualify as a regulated investment
company under the Code, it will not be required to pay any Massachusetts income,
corporate excise or franchise taxes or any Delaware corporation income tax.

41
<PAGE>

The description of certain federal tax provisions above relates only to U.S.
federal income tax consequences for shareholders who are U.S. persons, i.e.,
U.S. citizens or residents or U.S. corporations, partnerships, trusts or
estates, and who are subject to U.S. federal income tax. This description does
not address the special tax rules that may be applicable to particular types of
investors, such as financial institutions, insurance companies, securities
dealers, or tax-exempt or tax-deferred plans, accounts or entities. Investors
other than U.S. persons may be subject to different U.S. tax treatment,
including a non-resident alien U.S. withholding tax at the rate of 30% or at a
lower treaty rate on amounts treated as ordinary dividends from the fund and,
unless an effective IRS Form W-8, Form W-8BEN, or other authorized withholding
certificate is on file, to 31% backup withholding on certain other payments from
the fund. Shareholders should consult their own tax advisers on these matters
and on state, local and other applicable tax laws.

16. INVESTMENT RESULTS

Quotations, Comparisons and General Information

From time to time, in advertisements, in sales literature or in reports to
shareholders, the past performance of the fund may be illustrated and/or
compared with that of other mutual funds with similar investment objectives and
to stock or other relevant indices. For example, total return of the fund's
classes may be compared to averages or rankings prepared by Lipper, Inc., a
widely recognized independent service which monitors mutual fund performance;
the Merrill Lynch Micro-Cap Index, a recognized measure of the performance of
approximately 2,000 micro-cap stocks; the Russell 2000 Index, an unmanaged index
of common stocks of the 2000 smallest companies in the Russell 3000 Index; the
S&P 500, an index of unmanaged groups of common stock; the Dow Jones Industrial
Average, a recognized unmanaged index of common stocks of 30 industrial
companies listed on the Exchange; other Russell U.S. Equity Indexes or the
Wilshire Total Market Value Index, which are recognized unmanaged indexes of
broad-based common stocks; or any other appropriate index.

In addition, the performance of the classes of the fund may be compared to
alternative investment or savings vehicles and/or to indices or indicators of
economic activity, e.g., inflation or interest rates. The fund may also include
securities industry or comparative performance information generally and in
advertising or materials marketing the fund's shares. Performance rankings and
listings reported in newspapers or national business and financial publications,
such as Barron's, Business Week, Consumers Digest, Consumer Reports, Financial
World, Forbes, Fortune, Investors Business Daily, Kiplinger's Personal Finance
Magazine, Money Magazine, New York Times, Smart Money, USA Today, U.S. News and
World Report, The Wall Street Journal and Worth, may also be cited (if the fund
is listed in any such publication) or used for comparison, as well as
performance listings and rankings from various other sources including Bloomberg
Financial Markets, CDA/Wiesenberger, Donoghue's Mutual Fund Almanac, Ibbotson
Associates, Investment Company Data, Inc., Johnson's Charts, Kanon Bloch Carre
and Co., Lipper, Inc., Micropal, Inc., Morningstar, Inc., Schabacker Investment
Management and Towers Data Systems, Inc.

In addition, from time to time quotations from articles from financial
publications such as those listed above may be used in advertisements, in sales
literature or in reports to shareholders of the fund.

The fund may also present, from time to time, historical information depicting
the value of a hypothetical account in one or more classes of the fund since
inception.

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<PAGE>

In presenting investment results, the fund may also include references to
certain financial planning concepts, including (a) an investor's need to
evaluate his financial assets and obligations to determine how much to invest;
(b) his need to analyze the objectives of various investments to determine where
to invest; and (c) his need to analyze his time frame for future capital needs
to determine how long to invest. The investor controls these three factors, all
of which affect the use of investments in building assets.

One of the primary methods used to measure the performance of a class of the
fund is "total return." Total return will normally represent the percentage
change in value of an account, or of a hypothetical investment in a class of the
fund, over any period up to the lifetime of that class of the fund. Total return
calculations will usually assume the reinvestment of all dividends and capital
gain distributions and will be expressed as a percentage increase or decrease
from an initial value for the entire period or for one or more specified periods
within the entire period. Total return percentages for periods of less than one
year will usually be annualized; total return percentages for periods longer
than one year will usually be accompanied by total return percentages for each
year within the period and/or by the average annual compounded total return for
the period. The income and capital components of a given return may be separated
and portrayed in a variety of ways in order to illustrate their relative
significance. Performance may also be portrayed in terms of cash or investment
values without percentages. Past performance cannot guarantee any particular
future result.

The fund's average annual total return quotations for each of its classes as
that information may appear in the fund's prospectus, this statement of
additional information or in advertising are calculated by standard methods
prescribed by the SEC.

Standardized Average Annual Total Return Quotations

Average annual total return quotations for each class of shares are computed by
finding the average annual compounded rates of return that would cause a
hypothetical investment in the class made on the first day of a designated
period (assuming all dividends and distributions are reinvested) to equal the
ending redeemable value of such hypothetical investment on the last day of the
designated period in accordance with the following formula:

P(1+T)(n) = ERV

Where:

P = a hypothetical initial payment of $1,000, less the maximum sales
load of $57.50 for Class A shares or the deduction of the CDSC for
Class B shares at the end of the period

T = average annual total return

n = number of years

ERV = ending redeemable value of the hypothetical $1,000 initial payment
made at the beginning of the designated period (or fractional
portion thereof)

For purposes of the above computation, it is assumed that all dividends and
distributions made by the fund are reinvested at net asset value during the
designated period. The average annual total return quotation is determined to
the nearest 1/100 of 1%.

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<PAGE>

In determining the average annual total return (calculated as provided above),
recurring fees, if any, that are charged to all shareholder accounts of a
particular class of shares are taken into consideration. For any account fees
that vary with the size of the account, the account fee used for purposes of the
above computation is assumed to be the fee that would be charged to a class'
mean account size.

See Appendix A for the annual total returns for each class of fund shares as of
the most recently completed fiscal year.

17. FINANCIAL STATEMENTS

The fund's audited financial statements for the fiscal year ended November 30,
1999 from the fund's annual report filed with the SEC on January 20, 2000
(Accession No. 0001025187-00-000001) are incorporated by reference into this
statement of additional information. Those financial statements, including the
financial highlights in the prospectus, have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their report with respect
to the financial statements and are included in reliance upon the authority of
Arthur Andersen LLP as experts in accounting and auditing in giving their
report.

The fund's annual report includes the financial statements referenced above and
is available without charge upon request by calling Shareholder Services at
1-800-225-6292.

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<PAGE>

18. APPENDIX A - ANNUAL FEE, EXPENSE AND OTHER INFORMATION

Portfolio Turnover

The fund's annual portfolio turnover rate was 78% for the fiscal year ended
November 30, 1999.

Share Ownership

As of February 29, 2000, the Trustees and officers of the fund owned
beneficially in the aggregate less than 1% of the outstanding shares of the
fund. The following is a list of the holders of 5% or more of any class of the
fund's outstanding shares as of February 29, 2000:

<TABLE>
<CAPTION>
Number of
Record Holder Share Class Shares % of Class
<S> <C> <C> <C>
Merrill Lynch, Pierce, Fenner & Smith Class A 125,529 5.33
Incorporated for the Sole Benefit of its Customers Class B 670,742 17.00
4800 Deer Lake Drive East, 2nd Floor
Jacksonville, FL 32246-6484
</TABLE>

Compensation of Officers and Trustees

The following table sets forth certain information with respect to the
compensation of each Trustee of the fund.

Pension or Total
Retirement Compensation
Benefits from the Fund
Aggregate Accrued as and Other
Name of Trustee Compensation Part of Fund Pioneer Mutual
from Fund* Expenses Funds**

John F. Cogan, Jr.*** $ 750.00 $0 $18,000.00
Mary K. Bush 2,883.00 0 93,500.00
Richard H. Egdahl, M.D. 2,883.00 0 95,500.00
Margaret B.W. Graham 2,922.00 0 102,000.00
John W. Kendrick 2,525.00 0 82,500.00
Marguerite A. Piret 3,070.00 0 116,750.00
David D. Tripple*** 750.00 0 18,000.00
Stephen K. West 2,981.00 0 108,250.00
John Winthrop 2,931.00 0 98,400.00
$21,695.00 $0 $732,900.00

* For the fiscal year ended November 30, 1999.
** For the calendar year ended December 31, 1999.
*** Under the management contract, Pioneer reimburses the fund for any Trustees
fees paid by the fund.

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<PAGE>

Management Fees the Fund Paid or Owed Pioneer

For the Fiscal Years Ended November 30, February 28, 1997 through
1999 1998 November 30, 1997
$936,624 $1,307,670* $407,068*

*An expense limitation was in effect during the years ended November 30, 1998
and 1997. In the absence of the expense limitation, the fund would have paid
$1,313,202 and $592,206 in management fees for such periods.

Fees the Fund Paid to Pioneer under the Administration Agreement effective
October 9, 1998

For the Fiscal Year Ended November 30,
1999
$29,004

Carryover of Distribution Expenses

As of December 31, 1999 there was a carryover of distribution expenses in the
amount of $1,038 under the Class A Plan.

Approximate Net Underwriting Commissions Retained by PFD

For the Fiscal Years Ended November 30, February 28, 1997 through
1999 1998 November 30, 1997
$12,000 $55,000 $155,000

Approximate Commissions Reallowed to Dealers

For the Fiscal Years Ended November 30, February 28, 1997 through
1999 1998 November 30, 1997
$86,000 $368,000 $1,903,000

Fund Expenses under the Distribution Plans

For the Fiscal Year Ended November 30, 1999

Class A Plan Class B Plan
$83,144 $545,941

CDSCs

During the fiscal year ended November 30, 1999, CDSCs in the amount of $388,700
were paid to PFD.

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<PAGE>

Approximate Brokerage and Underwriting Commissions (Portfolio Transactions)

For the Fiscal Years Ended November 30, February 28, 1997 through
1999 1998 November 30, 1997
$218,000 $214,000 $246,000

Capital Loss Carryforwards as of November 30, 1999

At November 30, 1999, the Fund had a capital loss carryforward of $1,666,148
which will expire by 2006 if not used.

Average Annual Total Returns (November 30, 1999)

Average Annual Total Return (%)
Since Inception
Class of Shares One Year Five Years Ten Years Inception Date
Class A Shares 18.45 N/A N/A 5.75 02/28/97
Class B Shares 20.69 N/A N/A 6.35 02/28/97

47
<PAGE>

19. APPENDIX B - DESCRIPTION OF SHORT-TERM DEBT, CORPORATE BOND AND PREFERRED
STOCK RATINGS1

Moody's Investors Service, Inc. ("Moody's") Short-Term Prime Rating System

Moody's short-term debt ratings are opinions of the ability of issuers to repay
punctually senior debt obligations. These obligations have an original maturity
not exceeding one year, unless explicitly noted.

Moody's employs the following three designations, all judged to be investment
grade, to indicate the relative repayment ability of rated issuers:

Prime-1: Issuers rated Prime-1 (or supporting institutions) have a superior
ability for repayment of senior short-term debt obligations. Prime-1 repayment
ability will often be evidenced by many of the following characteristics:

Leading market positions in well-established industries.
High rates of return on funds employed.
Conservative capitalization structure with moderate reliance on debt and
ample asset protection.
Broad margins in earnings coverage of fixed financial charges and high
internal cash generation.
Well-established access to a range of financial markets and assured
sources of alternate liquidity.

Prime-2: Issuers rated Prime-2 (or supporting institutions) have a strong
ability for repayment of senior short-term debt obligations. This will normally
be evidenced by many of the characteristics cited above but to a lesser degree.
Earnings trends and coverage ratios, while sound, may be more subject to
variation. Capitalization characteristics, while still appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.

Prime-3: Issuers rated Prime-3 (or supporting institutions) have an acceptable
ability for repayment of senior short-term obligations. The effect of industry
characteristics and market compositions may be more pronounced. Variability in
earnings and profitability may result in changes in the level of debt protection
measurements and may require relatively high financial leverage. Adequate
alternate liquidity is maintained.

Not Prime: Issuers rated Not Prime do not fall within any of the Prime rating
categories.

Obligations of a branch of a bank are considered to be domiciled in the country
in which the branch is located. Unless noted as an exception, Moody's rating on
a bank's ability to repay senior obligations extends only to branches located in
countries which carry a Moody's Sovereign Rating for Bank Deposits. Such branch
obligations are rated at the lower of the bank's rating or Moody's Sovereign
Rating for Bank Deposits for the country in which the branch is located.

When the currency in which an obligation is denominated is not the same as the
currency of the country

- ---------------
(1) The ratings indicated herein are believed to be the most recent ratings
available at the date of this statement of additional information for the
securities listed. Ratings are generally given to securities at the time of
issuance. While the rating agencies may from time to time revise such ratings,
they undertake no obligation to do so, and the ratings indicated do not
necessarily represent ratings which will be given to these securities on the
date of the fund's fiscal year-end.

48
<PAGE>

in which the obligation is domiciled, Moody's ratings do not incorporate an
opinion as to whether payment of the obligation will be affected by actions of
the government controlling the currency of denomination. In addition, risks
associated with bilateral conflicts between an investor's home country and
either the issuer's home country or the country where an issuer's branch is
located are not incorporated into Moody's short-term debt ratings.

If an issuer represents to Moody's that its short-term debt obligations are
supported by the credit of another entity or entities, then the name or names of
such supporting entity or entities are listed within the parenthesis beneath the
name of the issuer, or there is a footnote referring the reader to another page
for the name or names of the supporting entity or entities. In assigning ratings
to such issuers, Moody's evaluates the financial strength of the affiliated
corporations, commercial banks, insurance companies, foreign governments or
other entities, but only as one factor in the total rating assessment.

Moody's Debt Ratings

Aaa: Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as "gilt
edged." Interest payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective elements are likely
to change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.

Aa: Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high-grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuation of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risk appear somewhat larger than the Aaa securities.

A: Bonds which are rated A possess many favorable investment attributes and are
to be considered as upper-medium-grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment sometime in the future.

Baa: Bonds which are rated Baa are considered as medium-grade obligations (i.e.,
they are neither highly protected nor poorly secured). Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.

Ba: Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B: Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

Caa: Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be

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present elements of danger with respect to principal or interest.

Ca: Bonds which are rated Ca represent obligations which are speculative in a
high degree. Such issues are often in default or have other marked shortcomings.

C: Bonds which are rated C are the lowest rated class of bonds, and issues so
rated can be regarded as having extremely poor prospects of ever attaining any
real investment standing.

Moody's bond ratings, where specified, are applicable to financial contracts,
senior bank obligations and insurance company senior policyholder and claims
obligations with an original maturity in excess of one year. Obligations relying
upon support mechanisms such as letters-of-credit and bonds of indemnity are
excluded unless explicitly rated. Obligations of a branch of a bank are
considered to be domiciled in the country in which the branch is located.

Unless noted as an exception, Moody's rating on a bank's ability to repay senior
obligations extends only to branches located in countries which carry a Moody's
Sovereign Rating for Bank Deposits. Such branch obligations are rated at the
lower of the bank's rating or Moody's Sovereign Rating for the Bank Deposits for
the country in which the branch is located. When the currency in which an
obligation is denominated is not the same as the currency of the country in
which the obligation is domiciled, Moody's ratings do not incorporate an opinion
as to whether payment of the obligation will be affected by the actions of the
government controlling the currency of denomination. In addition, risk
associated with bilateral conflicts between an investor's home country and
either the issuer's home country or the country where an issuer branch is
located are not incorporated into Moody's ratings.

Moody's makes no representation that rated bank obligations or insurance company
obligations are exempt from registration under the 1933 Act or issued in
conformity with any other applicable law or regulation. Nor does Moody's
represent any specific bank or insurance company obligation is legally
enforceable or a valid senior obligation of a rated issuer.

Note: Moody's applies numerical modifiers 1, 2 and 3 in each generic rating
classification from Aa through Caa. The modifier 1 indicates that the obligation
ranks in the higher end of its generic rating category; the modifier 2 indicates
a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of
that generic rating category.

Moody's Preferred Stock Ratings

Because of the fundamental differences between preferred stocks and bonds, a
variation of Moody's familiar bond rating symbols is used in the quality ranking
of preferred stock. The symbols, presented below, are designed to avoid
comparison with bond quality in absolute terms. It should always be borne in
mind that preferred stock occupies a junior position to bonds within a
particular capital structure and that these securities are rated within the
universe of preferred stocks.

aaa: An issue which is rated aaa is considered to be a top-quality preferred
stock. This rating indicates good asset protection and the least risk of
dividend impairment within the universe of preferred stocks.

aa: An issue which is rated aa is considered a high-grade preferred stock. This
rating indicates that there is a reasonable assurance the earnings and asset
protection will remain relatively well maintained in the foreseeable future.

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a: An issue which is rated a is considered to be an upper-medium grade preferred
stock. While risks are judged to be somewhat greater then in the aaa and aa
classification, earnings and asset protection are, nevertheless, expected to be
maintained at adequate levels.

baa: An issue which is rated baa is considered to be a medium-grade preferred
stock, neither highly protected nor poorly secured. Earnings and asset
protection appear adequate at present but may be questionable over any great
length of time.

ba: An issue which is rated ba is considered to have speculative elements and
its future cannot be considered well assured. Earnings and asset protection may
be very moderate and not well safeguarded during adverse periods. Uncertainty of
position characterizes preferred stocks in this class.

b: An issue which is rated b generally lacks the characteristics of a desirable
investment. Assurance of dividend payments and maintenance of other terms of the
issue over any long period of time may be small.

caa: An issue which is rated caa is likely to be in arrears on dividend
payments. This rating designation does not purport to indicate the future status
of payments.

ca: An issue which is rated ca is speculative in a high degree and is likely to
be in arrears on dividends with little likelihood of eventual payments.

c: This is the lowest rated class of preferred or preference stock. Issues so
rated can thus be regarded as having extremely poor prospects of ever attaining
any real investment standing.

Note: Moody's applies numerical modifiers 1, 2 and 3 in each rating
classification: the modifier 1 indicates that the security ranks in the higher
end of its generic rating category; the modifier 2 indicates a mid-range ranking
and the modifier 3 indicates that the issue ranks in the lower end of its
generic rating category.

Standard & Poor's Short-Term Issue Credit Ratings

A-1: A short-term obligation rated A-1 is rated in the highest category by
Standard & Poor's. The obligor's capacity to meet its financial commitment on
the obligation is strong. Within this category, certain obligations are
designated with a plus sign (+). This indicates that the obligor's capacity to
meet its financial commitment on these obligations is extremely strong.

A-2: A short-term obligation rated A-2 is somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions than
obligations in higher rating categories. However, the obligor's capacity to meet
its financial commitment on the obligation is satisfactory.

A-3: A short-term obligation rated A-3 exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances are more likely
to lead to a weakened capacity of the obligor to meet its financial commitment
on the obligation.

B: A short-term obligation rated B is regarded as having significant speculative
characteristics. The obligor currently has the capacity to meet its financial
commitment on the obligation; however, it faces

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major ongoing uncertainties which could lead to the obligor's inadequate
capacity to meet its financial commitment on the obligation.

C: A short-term obligation rated C is currently vulnerable to nonpayment and is
dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation.

D: A short-term obligation rated D is in payment default. The D rating category
is used when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless Standard & Poor's believes that
such payments will be made during such grace period. The D rating also will be
used upon the filing of a bankruptcy petition or the taking of a similar action
if payments on an obligation are jeopardized.

Standard & Poor's Long-Term Issue Credit Ratings

Issue credit ratings are based, in varying degrees, on the following
considerations:

Likelihood of payment-capacity and willingness of the obligor to meet its
financial commitment on an obligation in accordance with the terms of the
obligation;

Nature of and provisions of the obligation;

Protection afforded by, and relative position of, the obligation in the
event of bankruptcy, reorganization, or other arrangement under the laws
of bankruptcy and other laws affecting creditors' rights.

The issue rating definitions are expressed in terms of default risk. As such,
they pertain to senior obligations of an entity. Junior obligations are
typically rated lower than senior obligations, to reflect the lower priority in
bankruptcy, as noted above. (Such differentiation applies when an entity has
both senior and subordinated obligations, secured and unsecured obligations, or
operating company and holding company obligations.) Accordingly, in the case of
junior debt, the rating may not conform exactly with the category definition.

AAA: An obligation rated AAA has the highest rating assigned by Standard &
Poor's. The obligor's capacity to meet its financial commitment on the
obligation is extremely strong.

AA: An obligation rated AA differs from the highest-rated obligations only in
small degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.

A: An obligation rated A is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.

BBB: An obligation rated BBB exhibits adequate protection parameters. However,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity of the obligor to meet its financial commitment on the
obligation.

Obligations rated BB, B, CCC, CC, and C are regarded as having significant
speculative characteristics. BB indicates the least degree of speculation and C
the highest. While such obligations will likely have some quality and protective
characteristics, these may be outweighed by large uncertainties or major

52
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exposures to adverse conditions.

BB: An obligation rated BB is less vulnerable to nonpayment than other
speculative issues. However, it faces major ongoing uncertainties or exposure to
adverse business, financial, or economic conditions which could lead to the
obligor's inadequate capacity to meet its financial commitment on the
obligation.

B: An obligation rated B is more vulnerable to nonpayment than obligations rated
BB, but the obligor currently has the capacity to meet its financial commitment
on the obligation. Adverse business, financial, or economic conditions will
likely impair the obligor's capacity or willingness to meet its financial
commitment on the obligation.

CCC: An obligation rated CCC is currently vulnerable to nonpayment and is
dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation. In the event of
adverse business, financial, or economic conditions, the obligor is not likely
to have the capacity to meet its financial commitment on the obligation.

CC: An obligation rated CC is currently highly vulnerable to nonpayment.

C: A subordinated debt or preferred stock obligation rated C is currently highly
vulnerable to nonpayment. The C rating may be used to cover a situation where a
bankruptcy petition has been filed or similar action taken, but payments on this
obligation are being continued. A C also will be assigned to a preferred stock
issue in arrears on dividends or sinking fund payments but that is currently
paying.

D: An obligation rated D is in payment default. The D rating category is used
when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless Standard & Poor's believes that
such payments will be made during such grace period. The D rating also will be
used upon the filing of a bankruptcy petition or the taking of a similar action
if payments on an obligation are jeopardized.

Plus (+) or Minus (-): The rating from AA to CCC may be modified by the addition
of a plus or minus sign to show relative standing within the major rating
categories.

r: This symbol is attached to the ratings of instruments with significant
noncredit risks. It highlights risks to principal or volatility of expected
returns which are not addressed in the credit rating. Examples include:
obligations linked or indexed to equities, currencies, or commodities;
obligations exposed to severe prepayment risk, such as interest-only or
principal-only mortgage securities; and obligations with unusually risky
interest terms, such as inverse floaters.

N.R.: This indicates that no rating has been requested, that there is
insufficient information on which to base a rating, or that Standard & Poor's
does not rate a particular obligation as a matter of policy.

Local Currency and Foreign Currency Risks

Country risk considerations are a standard part of Standard & Poor's analysis
for credit ratings on any issuer or issue. Currency of repayment is a key factor
in this analysis. An obligor's capacity to repay foreign currency obligations
may be lower than its capacity to repay obligations in its local currency due to
the sovereign government's own relatively lower capacity to repay external
versus domestic debt. These sovereign risk considerations are incorporated in
the debt ratings assigned to specific issues.

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Foreign currency issuer ratings are also distinguished from local currency
issuer ratings to identify those instances where sovereign risks make them
different for the same issuer.

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20. APPENDIX C - PERFORMANCE STATISTICS

Pioneer Micro-Cap Fund
Class A Shares

Sales Net Asset Initial
Date Initial Offering Charge Shares Value Per Net Asset
Investment Price Included Purchased Share Value

2/28/97 $10,000 $15.92 5.75% 628.141 $15.00 $9,425

Value of Shares
(Dividends and Capital Gains Reinvested)

From Capital From
From Gains Dividends Total
Date Investment Reinvested Reinvested Value

12/31/97 $10,245 $685 $0 $10,930
12/31/98 $8,945 $598 $0 $9,543
12/31/99 $12,161 $813 $0 $12,974

Class B Shares

Sales Net Asset Initial
Date Initial Offering Charge Shares Value Per Net Asset
Investment Price Included Purchased Share Value

2/28/97 $10,000 $15.00 0.00% 666.667 $15.00 $10,000

Value of Shares
(Dividends and Capital Gains Reinvested)

From From
From Capital Gains Dividends CDSC if Total
Date Investment Reinvested Reinvested Redeemed Value CDSC%

12/31/97 $10,813 $727 $0 $400 $11,140 4.00
12/31/98 $9,380 $630 $0 $375 $9,635 4.00
12/31/99 $12,654 $850 $0 $300 $13,204 3.00

Past performance does not guarantee future results. Return and share price
fluctuate and your shares when redeemed may be worth more or less than your
original cost.

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Comparative Performance Index Descriptions

The following securities indices are well known, unmanaged measures of market
performance. Advertisements and sales literature for the fund may refer to these
indices or may present comparisons between the performance of the fund and one
or more of the indices. Other indices may also be used, if appropriate. The
indices are not available for direct investment. The data presented are not
meant to be indicative of the performance of the fund, do not reflect past
performance and do not guarantee future results.

S&P 500. This index is a readily available, carefully constructed, market value
weighted benchmark of common stock performance. Currently, the S&P 500 includes
500 of the largest stocks (in terms of stock market value) in the U.S.

Dow Jones Industrial Average. This is a total return index based on the
performance of stocks of 30 blue chip companies widely held by individuals and
institutional investors. The 30 stocks represent about a fifth of the $8
trillion-plus market value of all U.S. stocks and about a fourth of the value of
stocks listed on the New York Stock Exchange (NYSE).

U.S. Small Stock Index. This index is a market value weighted index of the ninth
and tenth deciles of the NYSE, plus stocks listed on the American Stock Exchange
and over the counter with the same or less capitalization as the upper bound of
the NYSE ninth decile.

U.S. Inflation. The Consumer Price Index for All Urban Consumers (CPI-U), not
seasonally adjusted, is used to measure inflation, which is the rate of change
of consumer goods prices. Unfortunately, the inflation rate as derived by the
CPI is not measured over the same period as the other asset returns. All of the
security returns are measured from one month-end to the next month-end. CPI
commodity prices are collected during the month. Thus, measured inflation rates
lag the other series by about one-half month. Prior to January 1978, the CPI (as
compared with CPI-U) was used. Both inflation measures are constructed by the
U.S. Department of Labor, Bureau of Labor Statistics, Washington, DC.

S&P/BARRA Indexes. The S&P/BARRA Growth and Value Indexes are constructed by
dividing the stocks in the S&P 500 according to price-to-book ratios. The Growth
Index contains stocks with higher price-to-book ratios, and the Value Index
contains stocks with lower price-to-book ratios. Both indexes are market
capitalization weighted.

Merrill Lynch Micro-Cap Index. The Merrill Lynch Micro-Cap Index represents the
performance of 1,980 stocks ranging in market capitalization from $50 million to
$125 million. Index returns are calculated monthly.

Merrill Lynch High Yield Master II Index. This index is a market capitalization
weighted total return index covering U.S. dollar-denominated high-yield bonds.
Qualifying bonds must have at least $100 million par amount outstanding, a
remaining term to maturity greater than or equal to one year, and a credit
rating less than BBB3 but not in default (based on the composite of Moody's and
Standard & Poor's). The index includes deferred interest and pay-in-kind bonds,
but excludes structured notes, floating rate notes and other variable coupon
securities. The index also excludes emerging markets debt (issuers domiciled in
below investment grade rated countries). Index constituents are rebalanced
monthly on the last calendar day of the month. Index values are calculated
daily.

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<PAGE>

Merrill Lynch Index of Convertible Bonds (Speculative Quality). This is a market
capitalization weighted index including all mandatory and non-mandatory domestic
corporate convertible securities with at least an original par of $50 million or
a $50 million market value; securities dropping below a market value of $40
million are excluded. Returns are calculated weekly based on Thursday's closing
prices and are linked monthly. All securities must be convertible to common
stock only. Quality range is D3-BB1 based on composite Moody's and Standard
&Poor's ratings.

Long-Term U.S. Government Bonds. The total returns on long-term government bonds
after 1977 are constructed with data from The Wall Street Journal and are
calculated as the change in the flat price or and-interest price. From 1926 to
1976, data are obtained from the government bond file at the Center for Research
in Security Prices (CRSP), Graduate School of Business, University of Chicago.
Each year, a one-bond portfolio with a term of approximately 20 years and a
reasonably current coupon was used and whose returns did not reflect potential
tax benefits, impaired negotiability or special redemption or call privileges.
Where callable bonds had to be used, the term of the bond was assumed to be a
simple average of the maturity and first call dates minus the current date. The
bond was "held" for the calendar year and returns were computed.

Intermediate-Term U.S. Government Bonds. Total returns of intermediate-term
government bonds after 1987 are calculated from The Wall Street Journal prices,
using the change in flat price. Returns from 1934 to 1986 are obtained from the
CRSP government bond file.

Each year, one-bond portfolios are formed, the bond chosen is the shortest
noncallable bond with a maturity not less than five years, and this bond is
"held" for the calendar year. Monthly returns are computed. (Bonds with impaired
negotiability or special redemption privileges are omitted, as are partially or
fully tax-exempt bonds starting with 1943.) From 1934 to 1942, almost all bonds
with maturities near five years were partially or fully tax-exempt and were
selected using the rules described above. Personal tax rates were generally low
in that period, so that yields on tax-exempt bonds were similar to yields on
taxable bonds. From 1926 to 1933, there are few bonds suitable for construction
of a series with a five-year maturity. For this period, five-year bond yield
estimates are used.

Morgan Stanley Capital International ("MSCI"). These indices are in U.S. dollar
terms with gross dividends reinvested and measure the performance of developed
and emerging stock markets around the world. MSCI All Country indices represent
both the developed and the emerging markets for a particular region. These
indices are unmanaged. The free indices exclude shares which are not readily
purchased by non-local investors. MSCI covers over 1,500 securities in 28
emerging markets and 2,300 securities in 23 developed markets, totaling over $20
trillion in market capitalization. Several Pioneer mutual funds that invest in
international securities compare their performance to various MSCI indices.

6-Month CDs. Data sources include the Federal Reserve Bulletin and The Wall
Street Journal.

Long-Term U.S. Corporate Bonds. Since 1969, corporate bond total returns are
represented by the Salomon Brothers Long-Term High-Grade Corporate Bond Index.
As most large corporate bond transactions take place over the counter, a major
dealer is the natural source of these data. The index includes nearly all Aaa-
and Aa-rated bonds with at least 10 years to maturity. If a bond is downgraded
during a particular month, its return for the month is included in the index
before removing the bond from future portfolios.

From 1926 to 1968 the total returns were calculated by summing the capital
appreciation returns and the

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income returns. For the period 1946 to 1968, Ibbotson and Sinquefield backdated
the Salomon Brothers' index, using Salomon Brothers' monthly yield data with a
methodology similar to that used by Salomon Brothers for 1969 to 1995. Capital
appreciation returns were calculated from yields assuming (at the beginning of
each monthly holding period) a 20-year maturity, a bond price equal to par, and
a coupon equal to the beginning-of-period yield. For the period 1926 to 1945,
Standard & Poor's monthly high-grade corporate composite yield data were used,
assuming a 4% coupon and a 20-year maturity. The conventional present-value
formula for bond price for the beginning and end-of-month prices was used. (This
formula is presented in Ross, Stephen A., and Westerfield, Randolph W.,
Corporate Finance, Times Mirror/Mosby, St. Louis, 1990, p. 97 ["Level-Coupon
Bonds"].) The monthly income return was assumed to be one-twelfth the coupon.

Lehman Brothers Government/Corporate Bond Index - Intermediate. This index is
comprised of securities with one to ten years to maturity. It includes Treasury
and government agency securities, investment-grade corporate bonds and Yankee
bonds.

U.S. (30-Day) Treasury Bills. For the U.S. Treasury Bill Index, data from The
Wall Street Journal are used after 1977; the CRSP government bond file is the
source until 1976. Each month a one-bill portfolio containing the shortest-term
bill having not less than one month to maturity is constructed. (The bill's
original term to maturity is not relevant.) To measure holding period returns
for the one-bill portfolio, the bill is priced as of the last trading day of the
previous month-end and as of the last trading day of the current month.

National Association of Real Estate Investment Trusts ("NAREIT") Equity REIT
Index. All of the data are based upon the last closing price of the month for
all tax-qualified REITs listed on the NYSE, AMEX and NASDAQ. The data are
market-value-weighted. Prior to 1987 REITs were added to the index the January
following their listing. Since 1987 newly formed or listed REITs are added to
the total shares outstanding figure in the month that the shares are issued.
Only common shares issued by the REIT are included in the index. The total
return calculation is based upon the weighting at the beginning of the period.
Only those REITs listed for the entire period are used in the total return
calculation. Dividends are included in the month based upon their payment date.
There is no smoothing of income. Liquidating dividends, whether full or partial,
are treated as income.

Russell U.S. Equity Indexes. The Russell 3000(R) Index (the "Russell 3000") is
comprised of the 3,000 largest U.S. companies as determined by market
capitalization representing approximately 98% of the U.S. equity market. The
average market capitalization is approximately $4.4 billion. The Russell
2500(TM) Index measures performance of the 2,500 smallest companies in the
Russell 3000. The average market capitalization is approximately $876 million,
and the largest company in the index has an approximate market capitalization of
$3.8 billion. The Russell 2000(R) Index measures performance of the 2,000
smallest stocks in the Russell 3000; the largest company in the index has a
market capitalization of approximately $1.3 billion. The Russell 1000(R) Index
(the "Russell 1000") measures the performance of the 1,000 largest companies in
the Russell 3000. The average market capitalization is approximately $12.1
billion. The smallest company in the index has an approximate market
capitalization of $1.3 billion. The Russell Midcap(TM) Index measures
performance of the 800 smallest companies in the Russell 1000. The largest
company in the index has an approximate market capitalization of $11.2 billion.
The Russell 1000(R) Growth Index measures the performance of those Russell 1000
companies with higher price-to-book ratios and higher forecasted growth values.

The Russell indexes are reconstituted annually as of June 30, based on May 31
market capitalizations.

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<PAGE>

Wilshire Real Estate Securities Index. The Wilshire Real Estate Securities Index
is a broad measure of the performance of publicly traded real estate securities,
such as REITs and real estate operating companies ("REOCs"). The index is
capitalization-weighted. As of March 31, 1999, 119 companies were included in
the index, with a total market cap of $116.97 billion. At September 30, 1999,
the companies in the index were 92.31% equity and hybrid REITs and 7.69% REOCs.

Standard & Poor's MidCap 400 Index. The S&P 400 is a
market-capitalization-weighted index. The performance data for the index were
calculated by taking the stocks presently in the index and tracking them
backwards in time as long as there were prices reported. No attempt was made to
determine what stocks "might have been" in the S&P 400 five or ten years ago had
it existed. Dividends are reinvested on a monthly basis prior to June 30, 1991,
and are reinvested daily thereafter.

Lipper Indexes. These indexes represent equally weighted performance, adjusted
for capital gain distributions and income dividends, of mutual funds that are
considered peers of the Pioneer mutual funds. Lipper, Inc. is an independent
firm that tracks mutual fund performance.

Lehman Brothers Aggregate Bond Index. The Lehman Brothers Aggregate Bond Index
is composed of the Lehman Brothers Government/Corporate Index, the Lehman
Brothers Mortgage-Backed Securities Index and the Lehman Brothers Asset-Backed
Securities Index. The index includes fixed rate debt issues rated investment
grade or higher by Moody's Investors Service, Standard & Poor's Corporation or
Fitch Investors Service, in that order. All issues have at least one year to
maturity with intermediate indices including bonds with maturities up to ten
years and long-term indices composed of bonds with maturities longer than ten
years. All returns are market value weighted inclusive of accrued interest.

Bank Savings Account. Data sources include the U.S. League of Savings
Institutions Sourcebook; average annual yield on savings deposits in FSLIC
[FDIC] insured savings institutions for the years 1963 to 1987; and The Wall
Street Journal thereafter.

Nasdaq Composite Index. The Nasdaq Composite Index measures all Nasdaq domestic
and non-U.S. based common stocks listed on The Nasdaq Stock Market. The index is
market-value weighted. The Nasdaq Composite includes over 5,000 companies and is
one of the most widely followed and quoted major market indices because it is so
broad-based.

Sources: Ibbotson Associates, Towers Data Systems, Lipper, Inc. and PGI

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<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

Dow U.S. S&P/ S&P/ Merrill
Jones Small BARRA BARRA Lynch
S&P Industrial Stock U.S. 500 500 Micro-Cap
500 Average Index Inflation Growth Value Index
- -----------------------------------------------------------------------------
Dec 1925 N/A N/A N/A N/A N/A N/A N/A
Dec 1926 11.62 N/A 0.28 -1.49 N/A N/A N/A
Dec 1927 37.49 N/A 22.10 -2.08 N/A N/A N/A
Dec 1928 43.61 55.38 39.69 -0.97 N/A N/A N/A
Dec 1929 -8.42 -13.64 -51.36 0.20 N/A N/A N/A
Dec 1930 -24.90 -30.22 -38.15 -6.03 N/A N/A N/A
Dec 1931 -43.34 -49.02 -49.75 -9.52 N/A N/A N/A
Dec 1932 -8.19 -16.88 -5.39 -10.30 N/A N/A N/A
Dec 1933 53.99 73.72 142.87 0.51 N/A N/A N/A
Dec 1934 -1.44 8.08 24.22 2.03 N/A N/A N/A
Dec 1935 47.67 43.77 40.19 2.99 N/A N/A N/A
Dec 1936 33.92 30.23 64.80 1.21 N/A N/A N/A
Dec 1937 -35.03 -28.88 -58.01 3.10 N/A N/A N/A
Dec 1938 31.12 33.16 32.80 -2.78 N/A N/A N/A
Dec 1939 -0.41 1.31 0.35 -0.48 N/A N/A N/A
Dec 1940 -9.78 -7.96 -5.16 0.96 N/A N/A N/A
Dec 1941 -11.59 -9.88 -9.00 9.72 N/A N/A N/A
Dec 1942 20.34 14.13 44.51 9.29 N/A N/A N/A
Dec 1943 25.90 19.06 88.37 3.16 N/A N/A N/A
Dec 1944 19.75 17.19 53.72 2.11 N/A N/A N/A
Dec 1945 36.44 31.60 73.61 2.25 N/A N/A N/A
Dec 1946 -8.07 -4.40 -11.63 18.16 N/A N/A N/A
Dec 1947 5.71 7.61 0.92 9.01 N/A N/A N/A
Dec 1948 5.50 4.27 -2.11 2.71 N/A N/A N/A
Dec 1949 18.79 20.92 19.75 -1.80 N/A N/A N/A
Dec 1950 31.71 26.40 38.75 5.79 N/A N/A N/A
Dec 1951 24.02 21.77 7.80 5.87 N/A N/A N/A
Dec 1952 18.37 14.58 3.03 0.88 N/A N/A N/A
Dec 1953 -0.99 2.02 -6.49 0.62 N/A N/A N/A
Dec 1954 52.62 51.25 60.58 -0.50 N/A N/A N/A
Dec 1955 31.56 26.58 20.44 0.37 N/A N/A N/A
Dec 1956 6.56 7.10 4.28 2.86 N/A N/A N/A
Dec 1957 -10.78 -8.63 -14.57 3.02 N/A N/A N/A
Dec 1958 43.36 39.31 64.89 1.76 N/A N/A N/A
Dec 1959 11.96 20.21 16.40 1.50 N/A N/A N/A
Dec 1960 0.47 -6.14 -3.29 1.48 N/A N/A N/A
Dec 1961 26.89 22.60 32.09 0.67 N/A N/A N/A
Dec 1962 -8.73 -7.43 -11.90 1.22 N/A N/A N/A
Dec 1963 22.80 20.83 23.57 1.65 N/A N/A N/A

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PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

Dow U.S. S&P/ S&P/ Merrill
Jones Small BARRA BARRA Lynch
S&P Industrial Stock U.S. 500 500 Micro-Cap
500 Average Index Inflation Growth Value Index
- ----------------------------------------------------------------------------
Dec 1964 16.48 18.85 23.52 1.19 N/A N/A N/A
Dec 1965 12.45 14.39 41.75 1.92 N/A N/A N/A
Dec 1966 -10.06 -15.78 -7.01 3.35 N/A N/A N/A
Dec 1967 23.98 19.16 83.57 3.04 N/A N/A N/A
Dec 1968 11.06 7.93 35.97 4.72 N/A N/A N/A
Dec 1969 -8.50 -11.78 -25.05 6.11 N/A N/A N/A
Dec 1970 4.01 9.21 -17.43 5.49 N/A N/A N/A
Dec 1971 14.31 9.83 16.50 3.36 N/A N/A N/A
Dec 1972 18.98 18.48 4.43 3.41 N/A N/A N/A
Dec 1973 -14.66 -13.28 -30.90 8.80 N/A N/A N/A
Dec 1974 -26.47 -23.58 -19.95 12.20 N/A N/A N/A
Dec 1975 37.20 44.75 52.82 7.01 31.72 43.38 N/A
Dec 1976 23.84 22.82 57.38 4.81 13.84 34.93 N/A
Dec 1977 -7.18 -12.84 25.38 6.77 -11.82 -2.57 N/A
Dec 1978 6.56 2.79 23.46 9.03 6.78 6.16 27.76
Dec 1979 18.44 10.55 43.46 13.31 15.72 21.16 43.18
Dec 1980 32.42 22.17 39.88 12.40 39.40 23.59 32.32
Dec 1981 -4.91 -3.57 13.88 8.94 -9.81 0.02 9.18
Dec 1982 21.41 27.11 28.01 3.87 22.03 21.04 33.62
Dec 1983 22.51 25.97 39.67 3.80 16.24 28.89 42.44
Dec 1984 6.27 1.31 -6.67 3.95 2.33 10.52 -14.97
Dec 1985 32.16 33.55 24.66 3.77 33.31 29.68 22.89
Dec 1986 18.47 27.10 6.85 1.13 14.50 21.67 3.45
Dec 1987 5.23 5.48 -9.30 4.41 6.50 3.68 -13.84
Dec 1988 16.81 16.14 22.87 4.42 11.95 21.67 22.76
Dec 1989 31.49 32.19 10.18 4.65 36.40 26.13 8.06
Dec 1990 -3.17 -0.56 -21.56 6.11 0.20 -6.85 -29.55
Dec 1991 30.55 24.19 44.63 3.06 38.37 22.56 57.44
Dec 1992 7.67 7.41 23.35 2.90 5.07 10.53 36.62
Dec 1993 9.99 16.94 20.98 2.75 1.68 18.60 31.32
Dec 1994 1.31 5.06 3.11 2.67 3.13 -0.64 1.81
Dec 1995 37.43 36.84 34.46 2.54 38.13 36.99 30.70
Dec 1996 23.07 28.84 17.62 3.32 23.96 21.99 13.88
Dec 1997 33.36 24.88 22.78 1.70 36.52 29.98 24.61
Dec 1998 28.58 18.14 -7.31 1.61 42.16 14.67 -6.15
Dec 1999 21.04 27.22 29.79 2.81 28.25 12.72 40.04

61
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

<TABLE>
<CAPTION>
Long- Intermediate- MSCI Long- Lehman
Term Term U.S. EAFE 6- Term U.S. Bros. U.S.
U.S. Gov't Government (Net of Month Corporate Gov't/Corp T-Bill
Bonds Bonds Taxes) CDs Bonds Intermediate (30-Day)
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Dec 1925 N/A N/A N/A N/A N/A N/A N/A
Dec 1926 7.77 5.38 N/A N/A 7.37 N/A 3.27
Dec 1927 8.93 4.52 N/A N/A 7.44 N/A 3.12
Dec 1928 0.10 0.92 N/A N/A 2.84 N/A 3.56
Dec 1929 3.42 6.01 N/A N/A 3.27 N/A 4.75
Dec 1930 4.66 6.72 N/A N/A 7.98 N/A 2.41
Dec 1931 -5.31 -2.32 N/A N/A -1.85 N/A 1.07
Dec 1932 16.84 8.81 N/A N/A 10.82 N/A 0.96
Dec 1933 -0.07 1.83 N/A N/A 10.38 N/A 0.30
Dec 1934 10.03 9.00 N/A N/A 13.84 N/A 0.16
Dec 1935 4.98 7.01 N/A N/A 9.61 N/A 0.17
Dec 1936 7.52 3.06 N/A N/A 6.74 N/A 0.18
Dec 1937 0.23 1.56 N/A N/A 2.75 N/A 0.31
Dec 1938 5.53 6.23 N/A N/A 6.13 N/A -0.02
Dec 1939 5.94 4.52 N/A N/A 3.97 N/A 0.02
Dec 1940 6.09 2.96 N/A N/A 3.39 N/A 0.00
Dec 1941 0.93 0.50 N/A N/A 2.73 N/A 0.06
Dec 1942 3.22 1.94 N/A N/A 2.60 N/A 0.27
Dec 1943 2.08 2.81 N/A N/A 2.83 N/A 0.35
Dec 1944 2.81 1.80 N/A N/A 4.73 N/A 0.33
Dec 1945 10.73 2.22 N/A N/A 4.08 N/A 0.33
Dec 1946 -0.10 1.00 N/A N/A 1.72 N/A 0.35
Dec 1947 -2.62 0.91 N/A N/A -2.34 N/A 0.50
Dec 1948 3.40 1.85 N/A N/A 4.14 N/A 0.81
Dec 1949 6.45 2.32 N/A N/A 3.31 N/A 1.10
Dec 1950 0.06 0.70 N/A N/A 2.12 N/A 1.20
Dec 1951 -3.93 0.36 N/A N/A -2.69 N/A 1.49
Dec 1952 1.16 1.63 N/A N/A 3.52 N/A 1.66
Dec 1953 3.64 3.23 N/A N/A 3.41 N/A 1.82
Dec 1954 7.19 2.68 N/A N/A 5.39 N/A 0.86
Dec 1955 -1.29 -0.65 N/A N/A 0.48 N/A 1.57
Dec 1956 -5.59 -0.42 N/A N/A -6.81 N/A 2.46
Dec 1957 7.46 7.84 N/A N/A 8.71 N/A 3.14
Dec 1958 -6.09 -1.29 N/A N/A -2.22 N/A 1.54
Dec 1959 -2.26 -0.39 N/A N/A -0.97 N/A 2.95
Dec 1960 13.78 11.76 N/A N/A 9.07 N/A 2.66
</TABLE>

62
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT
<TABLE>
<CAPTION>
Long- Intermediate- MSCI Long- Lehman
Term Term U.S. EAFE 6- Term U.S. Bros. U.S.
U.S. Gov't Government (Net of Month Corporate Gov't/Corp T-Bill
Bonds Bonds Taxes) CDs Bonds Intermediate (30-Day)
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Dec 1961 0.97 1.85 N/A N/A 4.82 N/A 2.13
Dec 1962 6.89 5.56 N/A N/A 7.95 N/A 2.73
Dec 1963 1.21 1.64 N/A N/A 2.19 N/A 3.12
Dec 1964 3.51 4.04 N/A 4.17 4.77 N/A 3.54
Dec 1965 0.71 1.02 N/A 4.68 -0.46 N/A 3.93
Dec 1966 3.65 4.69 N/A 5.76 0.20 N/A 4.76
Dec 1967 -9.18 1.01 N/A 5.47 -4.95 N/A 4.21
Dec 1968 -0.26 4.54 N/A 6.45 2.57 N/A 5.21
Dec 1969 -5.07 -0.74 N/A 8.70 -8.09 N/A 6.58
Dec 1970 12.11 16.86 -11.66 7.06 18.37 N/A 6.52
Dec 1971 13.23 8.72 29.59 5.36 11.01 N/A 4.39
Dec 1972 5.69 5.16 36.35 5.39 7.26 N/A 3.84
Dec 1973 -1.11 4.61 -14.92 8.60 1.14 3.34 6.93
Dec 1974 4.35 5.69 -23.16 10.20 -3.06 5.88 8.00
Dec 1975 9.20 7.83 35.39 6.51 14.64 9.50 5.80
Dec 1976 16.75 12.87 2.54 5.22 18.65 12.34 5.08
Dec 1977 -0.69 1.41 18.06 6.11 1.71 3.31 5.12
Dec 1978 -1.18 3.49 32.62 10.21 -0.07 2.13 7.18
Dec 1979 -1.23 4.09 4.75 11.90 -4.18 6.00 10.38
Dec 1980 -3.95 3.91 22.58 12.33 -2.76 6.41 11.24
Dec 1981 1.86 9.45 -2.28 15.50 -1.24 10.50 14.71
Dec 1982 40.36 29.10 -1.86 12.18 42.56 26.10 10.54
Dec 1983 0.65 7.41 23.69 9.65 6.26 8.61 8.80
Dec 1984 15.48 14.02 7.38 10.65 16.86 14.38 9.85
Dec 1985 30.97 20.33 56.16 7.82 30.09 18.05 7.72
Dec 1986 24.53 15.14 69.44 6.30 19.85 13.12 6.16
Dec 1987 -2.71 2.90 24.63 6.59 -0.27 3.67 5.47
Dec 1988 9.67 6.10 28.27 8.15 10.70 6.78 6.35
Dec 1989 18.11 13.29 10.54 8.27 16.23 12.76 8.37
Dec 1990 6.18 9.73 -23.45 7.85 6.78 9.17 7.81
Dec 1991 19.30 15.46 12.13 4.95 19.89 14.63 5.60
Dec 1992 8.05 7.19 -12.17 3.27 9.39 7.17 3.51
Dec 1993 18.24 11.24 32.56 2.88 13.19 8.73 2.90
Dec 1994 -7.77 -5.14 7.78 5.40 -5.76 -1.95 3.90
Dec 1995 31.67 16.80 11.21 5.21 27.20 15.31 5.60
Dec 1996 -0.93 2.10 6.05 5.21 1.40 4.06 5.21
Dec 1997 15.85 8.38 1.78 5.71 12.95 7.87 5.26
Dec 1998 13.06 10.21 20.00 5.34 10.76 8.42 4.86
Dec 1999 -8.96 -1.77 26.96 5.43 -7.45 0.39 4.68
</TABLE>

63
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

NAREIT Wilshire Lipper MSCI
Equity Russell Real Estate Balanced Emerging Bank
REIT 2000(R) Securities S&P Fund Markets Savings
Index Index Index 400 Index Free Index Account
- --------------------------------------------------------------------------------
Dec 1925 N/A N/A N/A N/A N/A N/A N/A
Dec 1926 N/A N/A N/A N/A N/A N/A N/A
Dec 1927 N/A N/A N/A N/A N/A N/A N/A
Dec 1928 N/A N/A N/A N/A N/A N/A N/A
Dec 1929 N/A N/A N/A N/A N/A N/A N/A
Dec 1930 N/A N/A N/A N/A N/A N/A 5.30
Dec 1931 N/A N/A N/A N/A N/A N/A 5.10
Dec 1932 N/A N/A N/A N/A N/A N/A 4.10
Dec 1933 N/A N/A N/A N/A N/A N/A 3.40
Dec 1934 N/A N/A N/A N/A N/A N/A 3.50
Dec 1935 N/A N/A N/A N/A N/A N/A 3.10
Dec 1936 N/A N/A N/A N/A N/A N/A 3.20
Dec 1937 N/A N/A N/A N/A N/A N/A 3.50
Dec 1938 N/A N/A N/A N/A N/A N/A 3.50
Dec 1939 N/A N/A N/A N/A N/A N/A 3.40
Dec 1940 N/A N/A N/A N/A N/A N/A 3.30
Dec 1941 N/A N/A N/A N/A N/A N/A 3.10
Dec 1942 N/A N/A N/A N/A N/A N/A 3.00
Dec 1943 N/A N/A N/A N/A N/A N/A 2.90
Dec 1944 N/A N/A N/A N/A N/A N/A 2.80
Dec 1945 N/A N/A N/A N/A N/A N/A 2.50
Dec 1946 N/A N/A N/A N/A N/A N/A 2.20
Dec 1947 N/A N/A N/A N/A N/A N/A 2.30
Dec 1948 N/A N/A N/A N/A N/A N/A 2.30
Dec 1949 N/A N/A N/A N/A N/A N/A 2.40
Dec 1950 N/A N/A N/A N/A N/A N/A 2.50
Dec 1951 N/A N/A N/A N/A N/A N/A 2.60
Dec 1952 N/A N/A N/A N/A N/A N/A 2.70
Dec 1953 N/A N/A N/A N/A N/A N/A 2.80
Dec 1954 N/A N/A N/A N/A N/A N/A 2.90
Dec 1955 N/A N/A N/A N/A N/A N/A 2.90
Dec 1956 N/A N/A N/A N/A N/A N/A 3.00
Dec 1957 N/A N/A N/A N/A N/A N/A 3.30
Dec 1958 N/A N/A N/A N/A N/A N/A 3.38
Dec 1959 N/A N/A N/A N/A N/A N/A 3.53
Dec 1960 N/A N/A N/A N/A 5.77 N/A 3.86
Dec 1961 N/A N/A N/A N/A 20.59 N/A 3.90

64
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

NAREIT Wilshire Lipper MSCI
Equity Russell Real Estate Balanced Emerging Bank
REIT 2000(R) Securities S&P Fund Markets Savings
Index Index Index 400 Index Free Index Account
- -------------------------------------------------------------------------------
Dec 1962 N/A N/A N/A N/A -6.80 N/A 4.08
Dec 1963 N/A N/A N/A N/A 13.10 N/A 4.17
Dec 1964 N/A N/A N/A N/A 12.36 N/A 4.19
Dec 1965 N/A N/A N/A N/A 9.80 N/A 4.23
Dec 1966 N/A N/A N/A N/A -5.86 N/A 4.45
Dec 1967 N/A N/A N/A N/A 15.09 N/A 4.67
Dec 1968 N/A N/A N/A N/A 13.97 N/A 4.68
Dec 1969 N/A N/A N/A N/A -9.01 N/A 4.80
Dec 1970 N/A N/A N/A N/A 5.62 N/A 5.14
Dec 1971 N/A N/A N/A N/A 13.90 N/A 5.30
Dec 1972 8.01 N/A N/A N/A 11.13 N/A 5.37
Dec 1973 -15.52 N/A N/A N/A -12.24 N/A 5.51
Dec 1974 -21.40 N/A N/A N/A -18.71 N/A 5.96
Dec 1975 19.30 N/A N/A N/A 27.10 N/A 6.21
Dec 1976 47.59 N/A N/A N/A 26.03 N/A 6.23
Dec 1977 22.42 N/A N/A N/A -0.72 N/A 6.39
Dec 1978 10.34 N/A 13.04 N/A 4.80 N/A 6.56
Dec 1979 35.86 43.09 70.81 N/A 14.67 N/A 7.29
Dec 1980 24.37 38.58 22.08 N/A 19.70 N/A 8.78
Dec 1981 6.00 2.03 7.18 N/A 1.86 N/A 10.71
Dec 1982 21.60 24.95 24.47 22.68 30.63 N/A 11.19
Dec 1983 30.64 29.13 27.61 26.10 17.44 N/A 9.71
Dec 1984 20.93 -7.30 20.64 1.18 7.46 N/A 9.92
Dec 1985 19.10 31.05 20.14 35.58 29.83 N/A 9.02
Dec 1986 19.16 5.68 20.30 16.21 18.43 N/A 7.84
Dec 1987 -3.64 -8.77 -7.86 -2.03 4.13 N/A 6.92
Dec 1988 13.49 24.89 24.18 20.87 11.18 40.43 7.20
Dec 1989 8.84 16.24 2.37 35.54 19.70 64.96 7.91
Dec 1990 -15.35 -19.51 -33.46 -5.12 0.66 -10.55 7.80
Dec 1991 35.70 46.05 20.03 50.10 25.83 59.91 4.61
Dec 1992 14.59 18.41 7.36 11.91 7.46 11.40 2.89
Dec 1993 19.65 18.91 15.24 13.96 11.95 74.83 2.73
Dec 1994 3.17 -1.82 1.64 -3.57 -2.05 -7.32 4.96
Dec 1995 15.27 28.44 13.65 30.94 24.89 -5.21 5.24
Dec 1996 35.26 16.49 36.87 19.20 13.05 6.03 4.95
Dec 1997 20.29 22.36 19.80 32.26 20.30 -11.59 5.17
Dec 1998 -17.51 -2.55 -17.43 19.12 15.09 -25.34 4.63
Dec 1999 -4.62 21.26 14.72 14.72 8.98 66.41 5.29

65
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

<TABLE>
<CAPTION>
MSCI All Merrill
MSCI Country Lynch
All (AC) Merrill Index of Lipper
Country Asia Lehman Lynch Convertible Lipper Growth &
(AC) Asia Pacific Brothers High Yield Bonds Russell Growth Income
Free Free Aggregate Master II (Speculative 1000(R) Fund Fund
ex Japan ex Japan Bond Index Index Quality) Index Index Index
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dec 1925 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1926 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1927 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1928 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1929 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1930 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1931 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1932 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1933 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1934 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1935 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1936 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1937 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1938 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1939 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1940 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1941 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1942 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1943 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1944 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1945 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1946 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1947 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1948 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1949 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1950 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1951 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1952 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1953 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1954 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1955 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1956 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1957 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1958 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1959 N/A N/A N/A N/A N/A N/A N/A N/A
Dec 1960 N/A N/A N/A N/A N/A N/A 6.36 3.04
Dec 1961 N/A N/A N/A N/A N/A N/A 30.16 26.00
</TABLE>

66
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

<TABLE>
<CAPTION>
MSCI All Merrill
MSCI Country Lynch
All (AC) Merrill Index of Lipper
Country Asia Lehman Lynch Convertible Lipper Growth &
(AC) Asia Pacific Brothers High Yield Bonds Russell Growth Income
Free Free Aggregate Master II (Speculative 1000(R) Fund Fund
ex Japan ex Japan Bond Index Index Quality) Index Index Index
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dec 1962 N/A N/A N/A N/A N/A N/A -16.84 -11.87
Dec 1963 N/A N/A N/A N/A N/A N/A 22.43 19.10
Dec 1964 N/A N/A N/A N/A N/A N/A 14.99 15.23
Dec 1965 N/A N/A N/A N/A N/A N/A 26.61 19.00
Dec 1966 N/A N/A N/A N/A N/A N/A -1.80 -6.04
Dec 1967 N/A N/A N/A N/A N/A N/A 45.31 27.59
Dec 1968 N/A N/A N/A N/A N/A N/A 15.34 15.29
Dec 1969 N/A N/A N/A N/A N/A N/A -10.62 -11.80
Dec 1970 N/A N/A N/A N/A N/A N/A -8.57 1.10
Dec 1971 N/A N/A N/A N/A N/A N/A 26.17 13.77
Dec 1972 N/A N/A N/A N/A N/A N/A 18.08 12.87
Dec 1973 N/A N/A N/A N/A N/A N/A -24.75 -14.27
Dec 1974 N/A N/A N/A N/A N/A N/A -30.73 -20.85
Dec 1975 N/A N/A N/A N/A N/A N/A 32.83 34.62
Dec 1976 N/A N/A 15.60 N/A N/A N/A 20.07 25.66
Dec 1977 N/A N/A 3.04 N/A N/A N/A -2.62 -3.64
Dec 1978 N/A N/A 1.39 N/A N/A N/A 12.53 7.99
Dec 1979 N/A N/A 1.93 N/A N/A 22.31 29.29 23.87
Dec 1980 N/A N/A 2.71 N/A N/A 31.88 38.67 28.27
Dec 1981 N/A N/A 6.25 N/A N/A -5.10 -6.82 -1.39
Dec 1982 N/A N/A 32.62 N/A N/A 20.30 24.04 24.17
Dec 1983 N/A N/A 8.36 N/A N/A 22.13 21.35 22.76
Dec 1984 N/A N/A 15.15 N/A N/A 4.75 -3.60 4.29
Dec 1985 N/A N/A 22.10 N/A N/A 32.27 30.14 28.55
Dec 1986 N/A N/A 15.26 N/A N/A 17.87 15.59 17.63
Dec 1987 N/A N/A 2.76 4.47 N/A 2.94 3.25 2.64
Dec 1988 30.00 30.45 7.89 13.36 16.19 17.23 14.13 18.35
Dec 1989 32.13 21.43 14.53 2.31 9.82 30.42 27.47 23.73
Dec 1990 -6.54 -11.86 8.96 -4.36 -8.61 -4.16 -5.41 -5.99
Dec 1991 30.98 32.40 16.00 39.17 37.53 33.03 36.33 27.75
Dec 1992 21.81 9.88 7.40 17.44 24.06 9.04 7.63 9.63
Dec 1993 103.39 84.94 9.75 16.69 19.37 10.15 11.98 14.62
Dec 1994 -16.94 -12.59 -2.92 -1.03 -6.91 0.38 -1.57 -0.41
Dec 1995 4.00 10.00 18.47 20.46 25.14 37.77 32.65 31.14
Dec 1996 10.05 8.08 3.63 11.27 15.29 22.45 17.53 20.67
Dec 1997 -40.31 -34.20 9.65 13.27 16.76 32.85 28.03 26.88
Dec 1998 -7.79 -4.42 8.69 2.95 12.62 27.02 25.69 13.58
Dec 1999 64.67 49.83 -0.82 2.51 38.91 20.91 27.96 11.86
</TABLE>

67
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

MSCI All
Country Russell
MSCI MSCI World Free 1000(R) Nasdaq
Europe World ex U.S. Growth Composite
Index Index Index Index Index
- -----------------------------------------------------------------
Dec 1925 N/A N/A N/A N/A N/A
Dec 1926 N/A N/A N/A N/A N/A
Dec 1927 N/A N/A N/A N/A N/A
Dec 1928 N/A N/A N/A N/A N/A
Dec 1929 N/A N/A N/A N/A N/A
Dec 1930 N/A N/A N/A N/A N/A
Dec 1931 N/A N/A N/A N/A N/A
Dec 1932 N/A N/A N/A N/A N/A
Dec 1933 N/A N/A N/A N/A N/A
Dec 1934 N/A N/A N/A N/A N/A
Dec 1935 N/A N/A N/A N/A N/A
Dec 1936 N/A N/A N/A N/A N/A
Dec 1937 N/A N/A N/A N/A N/A
Dec 1938 N/A N/A N/A N/A N/A
Dec 1939 N/A N/A N/A N/A N/A
Dec 1940 N/A N/A N/A N/A N/A
Dec 1941 N/A N/A N/A N/A N/A
Dec 1942 N/A N/A N/A N/A N/A
Dec 1943 N/A N/A N/A N/A N/A
Dec 1944 N/A N/A N/A N/A N/A
Dec 1945 N/A N/A N/A N/A N/A
Dec 1946 N/A N/A N/A N/A N/A
Dec 1947 N/A N/A N/A N/A N/A
Dec 1948 N/A N/A N/A N/A N/A
Dec 1949 N/A N/A N/A N/A N/A
Dec 1950 N/A N/A N/A N/A N/A
Dec 1951 N/A N/A N/A N/A N/A
Dec 1952 N/A N/A N/A N/A N/A
Dec 1953 N/A N/A N/A N/A N/A
Dec 1954 N/A N/A N/A N/A N/A
Dec 1955 N/A N/A N/A N/A N/A
Dec 1956 N/A N/A N/A N/A N/A
Dec 1957 N/A N/A N/A N/A N/A
Dec 1958 N/A N/A N/A N/A N/A
Dec 1959 N/A N/A N/A N/A N/A
Dec 1960 N/A N/A N/A N/A N/A
Dec 1961 N/A N/A N/A N/A N/A

68
<PAGE>

PERFORMANCE STATISTICS - TOTAL RETURN PERCENT

MSCI All
Country Russell
MSCI MSCI World Free 1000(R) Nasdaq
Europe World ex U.S. Growth Composite
Index Index Index Index Index
- ----------------------------------------------------------------
Dec 1962 N/A N/A N/A N/A N/A
Dec 1963 N/A N/A N/A N/A N/A
Dec 1964 N/A N/A N/A N/A N/A
Dec 1965 N/A N/A N/A N/A N/A
Dec 1966 N/A N/A N/A N/A N/A
Dec 1967 N/A N/A N/A N/A N/A
Dec 1968 N/A N/A N/A N/A N/A
Dec 1969 N/A N/A N/A N/A N/A
Dec 1970 -10.64 -3.09 N/A N/A N/A
Dec 1971 26.33 18.36 N/A N/A N/A
Dec 1972 14.40 22.48 N/A N/A 17.18
Dec 1973 -8.77 -15.24 N/A N/A -31.06
Dec 1974 -24.07 -25.47 N/A N/A -35.11
Dec 1975 41.45 32.80 N/A N/A 29.76
Dec 1976 -7.80 13.40 N/A N/A 26.10
Dec 1977 21.90 0.68 N/A N/A 7.33
Dec 1978 21.88 16.52 N/A N/A 12.31
Dec 1979 12.31 10.95 N/A 23.91 28.11
Dec 1980 11.90 25.67 N/A 39.57 33.88
Dec 1981 -12.46 -4.79 N/A -11.31 -3.21
Dec 1982 3.97 9.71 N/A 20.46 18.67
Dec 1983 20.96 21.93 N/A 15.98 19.87
Dec 1984 0.62 4.72 N/A -0.95 -11.22
Dec 1985 78.93 40.56 N/A 32.85 31.36
Dec 1986 43.85 41.89 N/A 15.36 7.36
Dec 1987 3.66 16.16 N/A 5.31 -5.26
Dec 1988 15.81 23.29 27.90 11.27 15.41
Dec 1989 28.51 16.61 12.03 35.92 19.26
Dec 1990 -3.85 -17.02 -22.74 -0.26 -17.80
Dec 1991 13.11 18.28 13.96 41.16 56.84
Dec 1992 -4.71 -5.23 -10.97 5.00 15.45
Dec 1993 29.28 22.50 34.90 2.90 14.75
Dec 1994 2.28 5.08 6.63 2.66 -3.20
Dec 1995 21.62 20.72 9.94 37.19 39.92
Dec 1996 21.09 13.48 6.68 23.12 22.71
Dec 1997 23.80 15.76 2.04 30.49 21.64
Dec 1998 28.53 24.34 14.46 38.71 39.63
Dec 1999 15.89 24.93 30.91 33.16 85.59

69
<PAGE>

21. APPENDIX D - OTHER PIONEER INFORMATION

The Pioneer group of mutual funds was established in 1928 with the creation of
Pioneer Fund. Pioneer is one of the oldest and most experienced money managers
in the U.S.

As of December 31, 1999, Pioneer employed a professional investment staff of 82.

Total assets of all Pioneer mutual funds at December 31, 1999, were
approximately $23 billion representing 1,392,828 shareholder accounts, including
881,091 non-retirement accounts and 511,737 retirement accounts.

<PAGE>

PART C - OTHER INFORMATION

Item 23. Exhibits

Amended Form N-1A
Exhibit Reference
(a) 1.1. Agreement and Declaration of Trust.(1)
(a) 1.2. Certificate of Trust.(1)
(b) 2. By-Laws.(1)
(c) 4. Specimen Share Certificate.(1)
(d) 5. Form of Management Contract.(1)
(e) 6.1. Form of Underwriting Agreement.(2)
(e) 6.2. Form of Dealer Sales Agreement.(1)
(f) 7. None.
(g) 8. Form of Custodian Agreement with Brown Brothers
Harriman & Co.(1)
(h) 9. Form of Investment Company Service Agreement.(4)
(h) 9.1. Administration Agreement.(3)
(i) 10. Opinion of Counsel.(3)
(j) 11. Consent of Independent Public Accountants.(4)
(k) 12. None.
(l) 13. Form of Share Purchase Agreement.(1)
(m) 15.1. Class A Distribution Plan.(1)
(m) 15.2. Form of Class B Distribution Plan.(2)
(n) 18.1. Multiclass Plan Pursuant to Rule 18f-3.(1)
(o) 19. Not applicable.
(p) 20. Code of Ethics.(4)
N/A 21. Powers of Attorney.(4)

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

(1) Previously filed. Incorporated herein by reference from the exhibits
filed with the Fund's Registration Statement on Form N-1A (File No. 333-18639)
as filed with the Securities and Exchange Commission (the "SEC") on
December 23, 1996 (Accession No. 0001025187-96-000002).

(2) Previously filed. Incorporated herein by reference from the exhibits
filed with Post-Effective Amendment No. 3 to the Registration Statement as filed
with the SEC on October 30, 1998 (Accession No. 0000950146-98-001817).

(3) Previously filed. Incorporated herein by reference from the exhibits
filed with Post-Effective Amendment No. 4 to the Registration Statement as filed
with the SEC on January 15, 1999 (Accession No. 0001016964-99-000008).

(4) Filed herewith.

Item 24. Persons Controlled by or Under Common Control with the Fund

None.

Item 25. Indemnification

Except for the Agreement and Declaration of Trust, dated December 3,
1996 (the "Declaration"), establishing the Fund as a business trust under
Delaware law, there is no contract, arrangement or statute under which any
Trustee, officer, underwriter or affiliated person of the Fund is insured or
indemnified. The Declaration provides that no Trustee or officer will be
indemnified against any liability to which the Fund would otherwise be subject
by reason of or for willful misfeasance, bad faith, gross negligence or reckless
disregard of such person's duties.

Insofar as indemnification for liability arising under the Securities
Act of 1933, as amended (the "1933 Act"), may be available to Trustees, officers
and controlling persons of the Fund pursuant to the foregoing provisions, or
otherwise, the Fund has been advised that in the opinion of the SEC such

C-1
<PAGE>

indemnification is against public policy as expressed in the 1933 Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Fund of expenses incurred or
paid by a Trustee, officer or controlling person of the Fund in the successful
defense of any action, suit or proceeding) is asserted by such Trustee, officer
or controlling person in connection with the securities being registered, the
Fund will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the 1933 Act and will be governed by the final adjudication of such
issue.

Item 26. Business and Other Connections of Investment Adviser

Pioneer Investment Management, Inc. ("Pioneer Investments") is a registered
investment adviser under the Investment Advisers Act of 1940, as amended, and is
a wholly owned subsidiary of The Pioneer Group, Inc. ("Pioneer"). Pioneer
Investments manages investment companies, pension and profit sharing plans,
trusts, estates or charitable organizations and other corporations or
business entities.

To the knowledge of the Fund, none of Pioneer Investments' directors
or executive officers is or has been during their employment with Pioneer
Investments engaged in any other business, profession, vocation or employment
of a substantial nature for the past two fiscal years, except as noted below.
Certain directors and officers, however, may hold or may have held various
positions with, and engage or have engaged in business for, the investment
companies that Pioneer Investments manages, Pioneer and/or other Pioneer
subsidiaries.

OTHER BUSINESS, PROFESSION, VOCATION OR
EMPLOYMENT OF SUBSTANTIAL NATURE WITHIN LAST TWO
NAME OF DIRECTOR/OFFICER FISCAL YEARS

John F. Cogan, Jr. Of Counsel, Hale and Dorr LLP, 60 State
Street, Boston, Massachusetts 02109

Joseph P. Barri Senior Partner, Hale and Dorr LLP, 60 State
Street, Boston, Massachusetts 02109

Item 27. Principal Underwriters

(a) See "Management of the Fund" in the Statement of Additional
Information.

(b) Directors and officers of Pioneer Funds Distributor, Inc.:

POSITIONS AND OFFICES WITH POSITIONS AND OFFICES WITH
NAME UNDERWRITER FUND

John F. Cogan, Jr. Director and Chairman Chairman of the Board,
President and Trustee

David D. Tripple Director and President Executive Vice President and
Trustee

Steven M. Graziano Director and Executive
Vice President None

William A. Misata Senior Vice President None

Constance D. Spiros Senior Vice President None

Marcy L. Supovitz Senior Vice President None

Mark R. Kiniry Vice President, Regional
Director, Sales None

Barry G. Knight Vice President None

C-2

<PAGE>

William H. Spencer Vice President, Regional
Director, Sales None

Elizabeth A. Watson Vice President, Compliance None

Steven R. Berke Assistant Vice President,
Blue Sky None

Eric W. Reckard Treasurer Treasurer

Joseph P. Barri Clerk Secretary

Robert P. Nault Assistant Clerk Assistant Secretary

The principal business address of each of these individuals is 60 State Street,
Boston, Massachusetts 02109-1820.

Item 28. Location of Accounts and Records

The accounts and records are maintained at the Fund's office at
60 State Street, Boston, Massachusetts 02109; contact the Treasurer.

Item 29. Management Services

Not applicable.

Item 30. Undertakings

Not applicable.

C-3
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Fund certifies that it meets all of the
requirements for effectiveness of this registration statement under Rule 485(b)
under the Securities Act of 1933 and has duly caused this registration statement
to be signed on its behalf by the undersigned, duly authorized, in the City of
Boston and The Commonwealth of Massachusetts on the 29th day of March 2000.

PIONEER MICRO-CAP FUND

By: /s/ John F. Cogan, Jr.
John F. Cogan, Jr.
Chairman and President

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the date indicated:

Signature Title

/s/ John F. Cogan, Jr. Chairman of the Board )
John F. Cogan, Jr. and President )
(Principal Executive )
Officer) )
)
)
/s/ Eric W. Reckard Chief Financial Officer )
Eric W. Reckard and Treasurer (Principal )
Financial and Accounting )
Officer) )
)
)
Trustees: )
)
)
Mary K. Bush* )
Mary K. Bush )
)
)
/s/ John F. Cogan, Jr. )
John F. Cogan, Jr. )
)
)
)
Richard H. Egdahl* )
Richard H. Egdahl )
)
)
Margaret BW Graham* )
Margaret B. W. Graham )
)
)
John W. Kendrick* )
John W. Kendrick )
)
)
Marguerite A. Piret* )
Marguerite A. Piret )
)
)
David D. Tripple* )
David D. Tripple )
)
)
Stephen K. West* )
Stephen K. West )
)
)
John Winthrop* )
John Winthrop )
)
)
*By: /s/ John F. Cogan, Jr. Dated: March 29, 2000)
John F. Cogan, Jr.
Attorney-in-fact

<PAGE>

Exhibit Index

Exhibit
Number Document Title

(h) 9. Form of Investment Company Service Agreement

(j) 11. Consent of Independent Public Accountants

(p) 20. Code of Ethics

N/A 21. Powers of Attorney

INVESTMENT COMPANY SERVICE AGREEMENT

__________ __, 1999

__________________, a ____________ business trust with its principal
place of business at 60 State Street, Boston, Massachusetts 02109 ("Customer"),
and Pioneering Services Corporation, a Massachusetts corporation with its
principal place of business at 60 State Street, Boston, Massachusetts 02109
("PSC"), hereby agree as follows:

1. SERVICES TO BE PROVIDED BY PSC. During the term of this Agreement,
PSC will provide to each series of shares of beneficial interest of Customer,
which may be established, from time to time (the "Account"), with the services
described in EXHIBITS A, B, C and D (collectively, the "Exhibits") that are
attached hereto and incorporated herein by reference. It is understood that PSC
may subcontract any of such services to one or more firms designated by PSC,
provided that PSC (i) shall be solely responsible for all compensation payable
to any such firm and (ii) shall be liable to Customer for the acts or omissions
of any such firm to the same extent as PSC would be liable to Customer with
respect to any such act or omission hereunder.

2. EFFECTIVE DATE. This Agreement shall become effective on the date
hereof (the "Effective Date") and shall continue in effect until it is
terminated in accordance with Section 11 below.

3. DELIVERY OF DOCUMENTATION, MATERIALS AND DATA. Customer shall, from
time to time, while this Agreement is in effect deliver all such documentation,
materials and data as may be necessary or desirable to enable PSC to perform its
services hereunder.

4. REPORTS AND MAINTENANCE OF RECORDS BY PSC. PSC will furnish to
Customer and to properly authorized auditors, examiners, distributors, dealers,
underwriters, salesmen, insurance companies, investors, and others designated by
Customer in writing, such books, any and all records and reports at such times
as are prescribed for each service in the Exhibits attached hereto. Customer
agrees to examine or to ask any other authorized recipient to examine each such
report or copy promptly and will report or cause to be reported any errors or
discrepancies therein of which Customer then has any knowledge. PSC may at its
option at any time, and shall forthwith upon Customer's demand, turn over to
Customer and cease to retain in PSC's files, any and all records and documents
created and maintained by PSC pursuant to this Agreement which are no longer
needed by PSC in the performance of its services or for its protection.

If not so turned over to Customer, such documents and reports will be
retained by PSC for six years from the year of creation, during the first two of
which the same shall be in readily accessible form. At the end of six years,
such records and documents will be turned over to Customer by PSC unless
Customer authorizes their destruction.

5. PSC'S DUTY OF CARE. PSC shall at all time use reasonable care and
act in good faith in performing its duties hereunder. PSC shall incur no
liability to Customer in connection with its performance of services hereunder
except to the extent that it does not comply with the foregoing standards.

PSC shall at all times adhere to various procedures and systems
consistent with industry standards in order to safeguard Customer's checks,
records and other data from loss or damage attributable to fire or theft. PSC
shall maintain insurance adequate to protect against the costs of reconstructing
checks, records and other data in the event of such loss and shall notify
Customer in the event of a material adverse change in such insurance coverage.
In the

-1-

<PAGE>

event of damage or loss occurring to Customer's records or data such that
PSC is unable to meet the terms of this Agreement, PSC shall transfer all
records and data to a transfer agent of Customer's choosing upon Customer's
written authorization to do so.

Without limiting the generality of the foregoing, PSC shall not be
liable or responsible for delays or errors occurring by reason of circumstances
beyond its control including acts of civil, military or banking authority,
national emergencies, labor difficulties, fire, flood or other catastrophes,
acts of God, insurrection, war, riots, failure of transportation, communication
or power supply.

6. CONFIDENTIALITY. PSC will keep confidential all records and
information provided by Customer or by the shareholders of the Account to PSC,
except to the extent disclosures are required by this Agreement, are required by
the Customer's Prospectus and Statement of Additional Information, or are
required by a valid subpoena or warrant issued by a court of competent
jurisdiction or by a state or federal agency or governmental authority.

7. CUSTOMER INSPECTION. Upon reasonable notice, in writing signed by
Customer, PSC shall make available, during regular business hours, all records
and other data created and maintained pursuant to this Agreement for reasonable
audit and inspection by Customer or Customer's agents, including reasonable
visitation by Customer or Customer's agents, including inspecting PSC's
operation facilities. PSC shall not be liable for injury to or responsible in
any way for the safety of any individual visiting PSC's facilities under the
authority of this section. Customer will keep confidential and will cause to
keep confidential all confidential information obtained by its employees or
agents or any other individual representing Customer while on PSC's premises.
Confidential information shall include (1) any information of whatever nature
regarding PSC's operations, security procedures, and data processing
capabilities, (2) financial information regarding PSC, its affiliates, or
subsidiaries, and (3) any information of whatever kind or description regarding
any customer of PSC, its affiliates or subsidiaries.

8. RELIANCE BY PSC ON INSTRUCTIONS AND ADVICE; INDEMNITY. PSC shall be
entitled to seek advice of Customer's legal counsel with respect to PSC's
responsibilities and duties hereunder and shall in no event be liable to
Customer for any action taken pursuant to such advice, except to the extent that
Customer's legal counsel determines in its sole discretion that the rendering of
advice to PSC would result in a conflict of interest.

Whenever PSC is authorized to take action hereunder pursuant to proper
instructions from Customer, PSC shall be entitled to rely upon any certificate,
letter or other instrument or telephone call reasonably believed by PSC to be
genuine and to have been properly made or signed by an officer or other
authorized agent of Customer, and shall be entitled to receive as conclusive
proof of any fact or matter required to be ascertained by it hereunder a
certificate signed by an officer of Customer or any other person authorized by
Customer's Board of Trustees.

Subject to the provisions of Section 13 of this Agreement, Customer
agrees to indemnify and hold PSC, its employees, agents and nominees harmless
from any and all claims, demands, actions and suits, whether groundless or
otherwise, and from and against any and all judgments, liabilities, losses,
damages, costs, charges, counsel fees and other expenses of every nature and
character arising out of or in any way relating to PSC's action or non-action
upon information, instructions or requests given or made to PSC by Customer with
respect to the Account.

Notwithstanding the above, whenever Customer may be asked to indemnify
or hold PSC harmless, Customer shall be advised of all pertinent facts arising
from the situation in question. Additionally, PSC will use reasonable care to
identify and notify Customer promptly concerning

-2-

<PAGE>

any situation, which presents, actually or potentially, a claim for
indemnification against Customer. Customer shall have the option to defend PSC
against any claim for which PSC is entitled to indemnification from Customer
under the terms hereof, and in the event Customer so elects, it will notify PSC
and, thereupon, Customer shall take over complete defense of the claim and PSC
shall sustain no further legal or other expenses in such a situation for which
indemnification shall be sought or entitled. PSC may in no event confess any
claim or make any compromise in any case in which Customer will be asked to
indemnify PSC except with Customer's prior written consent.

9. MAINTENANCE OF DEPOSIT ACCOUNTS. PSC shall maintain on behalf of
Customer such deposit accounts as are necessary or desirable from time to time
to enable PSC to carry out the provisions of this Agreement.

10. COMPENSATION AND REIMBURSEMENT TO PSC. For the services rendered by
PSC under this Agreement, Customer agrees to pay to PSC an annual fee of
$______* per open account and an annual fee of $7.30 per closed account, such
fees to be payable in equal monthly installments. Customer shall reimburse PSC
monthly for out-of-pocket expenses, including but not limited to, forms,
postage, mail service, telephone charges, including internet access charges,
archives, microfiche and other records storage services, mailing and tabulating
proxies, sub account recordkeeper fees relating to omnibus accounts, and
miscellaneous. In addition, the Customer will reimburse any other expenses
incurred by PSC at the request of or with the consent of the Customer.

11. TERMINATION. Either PSC or Customer may at any time terminate this
Agreement by giving 90 days' prior written notice to the other.

After the date of termination, for so long as PSC in fact continues to
perform any one or more of the services contemplated by this Agreement or the
Exhibits, the provisions of this Agreement, including without limitation the
provisions of Section 8 dealing with indemnification, shall where applicable
continue in full force and effect.

12. REPRESENTATIONS AND WARRANTIES; REQUIRED DOCUMENTS.

12.1 REPRESENTATIONS AND WARRANTIES OF PSC.

PSC represents and warrants to the Customer that:

(a) It is a corporation duly organized and existing and
in good standing under the laws of The Commonwealth
of Massachusetts.

(b) It is duly qualified to carry on its business in The
Commonwealth of Massachusetts and the State of
Nebraska.

(d) It is empowered under all applicable laws and by its
Articles of Organization and By Laws to enter into
and perform this Agreement.

12.2 REPRESENTATIONS AND WARRANTIES OF CUSTOMER.

Customer represents and warrants to PSC that:

- --------
* Insert $25.25 for equity funds and $33.00 for fixed income funds and money
market fund.

-3-

<PAGE>

(a) It is a business trust duly organized and existing and
in good standing under the laws of its governing
jurisdiction.

(b) All requisite corporate proceedings have been taken to
authorize it to enter into this Agreement.

(c) It is empowered under all applicable laws and by its
Agreement and Declaration of Trust and By Laws to enter
into and perform this Agreement.

(d) It is an open-end management investment company
registered under the Investment Company Act of 1940, as
amended.

(e) A registration statement under the Securities Act of
1933, as amended (the "Registration Statement"), has
been filed with the Securities and Exchange Commission
and is currently effective and will remain effective,
and appropriate state securities law filings have been
made and will continue to be made, with respect to all
shares of beneficial interest of the Customer to be
offered for sale.

12.3 CUSTOMER DOCUMENT DELIVERY.

Customer shall promptly furnish to PSC the following:

(a) A copy of Customer's Agreement and Declaration of Trust
and By Laws and all amendments related thereto.

(b) A certified copy of the resolution of the Customer's
Board of Trustees authorizing the appointment of PSC
and the execution and delivery of this Agreement.

13. INDEMNIFICATION. The parties to this Agreement acknowledge and agree
that all liabilities arising, directly or indirectly, under this Agreement, of
any and every nature whatsoever, including without limitation, liabilities
arising in connection with any agreement of Customer or its Trustees set forth
herein to indemnify any party to this Agreement or any other person, shall be
satisfied out of the assets of the Account first and then of Customer and that
no Trustee, officer or holder of shares of beneficial interest of Customer shall
be personally liable for any of the foregoing liabilities. Customer's Agreement
and Declaration of Trust describes in detail the respective responsibilities and
limitations on liability of the Trustees, officers, and holders of shares of
beneficial interest of Customer.

14. MISCELLANEOUS. In connection with the operation of this Agreement,
PSC and Customer may agree from time to time on such provisions interpretive of
or in addition to the provisions of this Agreement as may in their joint opinion
be consistent with the general tenor of this Agreement. Any such interpretive or
additional provisions are to be signed by both parties and annexed hereto, but
no such provision shall contravene any applicable Federal and state law or
regulation, and no such provision shall be deemed to be an amendment of this
Agreement.

-4-

<PAGE>

This Agreement constitutes the entire agreement between the parties
hereto and supersedes any prior agreement with respect to the subject matter
hereof whether written or oral.

If any provision or provisions of this Agreement shall be held invalid,
unlawful or unenforceable, the validity, legality, and enforceability of the
remaining provisions of the Agreement shall not in any way be affected or
impaired.

This Agreement shall be construed in accordance with the laws of The
Commonwealth of Massachusetts.

IN WITNESS WHEREOF, Customer and PSC have caused this Agreement to
be executed in their respective names by their respective officers thereunto
duly authorized as of the date first written above.

ATTEST: PIONEERING SERVICES CORPORATION

_____________________________ By: _____________________________
Robert P. Nault, Assistant Clerk Roger B. Rainville
President

PIONEER ________________

_____________________________ By: _____________________________
Robert P. Nault, Assistant Secretary John F. Cogan, Jr.
President

-5-

<PAGE>

EXHIBIT A - TO INVESTMENT COMPANY SERVICE AGREEMENT

SHAREHOLDER ACCOUNT SERVICE:

As Servicing Agent for fund accounts and in accordance with the provisions of
the standard fund application and Customer's Prospectus and Statement of
Additional Information, PSC will:

1. Open, maintain and close accounts.

2. Purchase shares for the shareholder.

3. Out of the money received in payment for sales of Customer's shares pay
to the Customer's custodian the net asset value per share and pay to
the underwriter and to the dealer their commission, if any, on a
bimonthly basis.

4. Redeem shares by systematic withdrawal orders. (SEE EXHIBIT B)

5. Issue share certificates, upon instruction, resulting from withdrawals
from share accounts (It is the policy of PSC to issue share
certificates only upon request of the shareholder). Maintain records
showing name, address, certificate numbers and number of shares.

6. Deposit certificates to shareholder accounts when furnished with such
documents, as PSC deems necessary, to authorize the deposit.

7. Reinvest or disburse dividends and other distributions upon direction of
shareholder.

8. Establish the proper registration of ownership of shares.

9. Pass upon the adequacy of documents submitted by a shareholder or his
legal representative to substantiate the transfer of ownership of
shares from the registered owner to transferees.

10. Make transfers from time to time upon the books of the Customer in
accordance with properly executed transfer instructions furnished to
PSC.

11. Upon receiving appropriate detailed instructions and written materials
prepared by Customer and, where applicable, proxy proofs checked by
Customer, mail shareholder reports, proxies and related materials of
suitable design for automatic enclosing, receive and tabulate executed
proxies, and furnish an annual meeting list of shareholders when
required.

12. Respond to shareholder inquiries in a timely manner.

13. Maintain dealer and salesperson records.

14. Maintain and furnish to Customer such shareholder information as
Customer may reasonably request for the purpose of compliance by
Customer with the applicable tax and securities law of various
jurisdictions.

15. Mail confirmations of transactions to shareholders in a timely fashion
(confirmations of Automatic Investment Plan transactions will be mailed
quarterly).

-6-

<PAGE>

16. Provide Customer with such information regarding correspondence as well
as enable Customer to comply with related Form N-SAR (semi-annual
report) requirements.

17. Maintain continuous proof of the outstanding shares of Customer.

18. Solicit taxpayer identification numbers.

19. Provide data to enable Customer to file abandoned property reports for
those accounts that have been indicated by the Post Office to be not at
the address of record with no forwarding address.

20. Maintain bank accounts and reconcile same on a monthly basis.

21. Provide management information reports on a quarterly basis to
Customer's Board of Trustees outlining the level of service provided.

22. Provide sale/statistical reporting for purposes of providing Customer's
management with information to maximizing the return to shareholders.

-7-

<PAGE>

EXHIBIT B - TO INVESTMENT COMPANY SERVICE AGREEMENT

REDEMPTION SERVICE:

In accordance with the provisions of the Customer's Prospectus and Statement of
Additional Information, as servicing agent for the redemptions, PSC will:

1. Where applicable, establish accounts payable based on information
furnished to PSC on behalf of Customer (i.e., copies of trade
confirmations and other documents deemed necessary or desirable by PSC
on the first business day following the trade date).

2. Receive for redemption either:

a. Share certificates, supported by appropriate documentation; or

b. Written or telephone authorization (where no share certificates are
issued).

3. Verify there are sufficient available shares in an account to cover
redemption requests.

4. Transfer the redeemed or repurchased shares to Customer's treasury
share account or, if applicable, cancel such shares for retirement.

5. Pay the applicable redemption or repurchase price to the shareholder in
accordance with Customer's Prospectus, Statement of Additional
Information and Agreement and Declaration of Trust on or before the
seventh calendar day succeeding any receipt of certificates or requests
for redemption or repurchase in "good order" as defined in the
Prospectus and Statement of Additional Information.

6. Notify Customer and the underwriter on behalf of Customer of the total
number of shares presented and covered by such requests within a
reasonable period of time following receipt.

7. Promptly notify the shareholder if any such certificate or request for
redemption or repurchase is not in "good order" together with notice of
the documents required to comply with the good order standards. Upon
receipt of the necessary documents PSC shall effect such redemption at
the net asset value applicable at the date and time of receipt of such
documents.

8. Produce periodic reports of unsettled items, if any.

9. Adjust unsettled items, if any, relative to dividends and distributions.

10. Report to Customer any late redemptions which must be included in
Customer's Form N-SAR (semi-annual report) filing.

-8-

<PAGE>

EXHIBIT C - TO INVESTMENT COMPANY SERVICE AGREEMENT

EXCHANGE SERVICE:

1. Receive and process exchanges in accordance with a duly executed
exchange authorization. PSC will redeem existing shares and use the
proceeds to purchase new shares. Shares of Customer purchased directly
or acquired through reinvestment of dividends on such shares may be
exchanged for shares of other Pioneer funds (which funds have sales
charges) only by payment of the applicable sales charge, if any, as
described in Customer's Prospectus and Statement of Additional
Information. Shares of Customer acquired by exchange and through
reinvestment of dividends on such shares may be re-exchanged to another
Pioneer fund at their respective net asset values.

2. Make authorized deductions of fees, if any.

3. Register new shares identically with the shares surrendered for
exchange. Mail new shares certificates, if requested, or an account
statement confirming the exchange by first class mail to the address of
record.

4. Maintain a record of unprocessed exchanges and produce a periodic
report.

-9-

<PAGE>

EXHIBIT D - TO INVESTMENT COMPANY SERVICE AGREEMENT

INCOME ACCRUAL AND DISBURSING SERVICE:

1. Distribute income dividends and/or capital gain distributions, either
through reinvestment or in cash, in accordance with shareholder
instructions.

2. On the mailing date, Customer shall make available to PSC collected funds
to make such distribution.

3. Adjust unsettled items relative to dividends and distribution.

4. Reconcile dividends and/or distributions with Customer.

5. Prepare and file annual Federal and State information returns of
distributions and, in the case of Federal returns, mail information
copies to shareholders and report and pay Federal income taxes withheld
from distributions made to non-resident aliens.

-10-

Arthur Andersen LLP

Consent of Independent Public Accountants

As independent public accountants, we hereby consent to the use of our report
on Pioneer Micro-Cap Fund dated January 7, 2000 (and to all references
to our firm) included in or made a part of Post-Effective Amendment No. 6 and
Amendment No. 7 to Registration Statement File Nos. 333-18639 and 811-07985,
respectively.

/s/ Arthur Andersen LLP
Arthur Andersen LLP

Boston, Massachusetts
March 29, 2000

THE PIONEER COMPLEX OF FUNDS
- --------------------------------------------------------------------------------
CODE OF ETHICS
- --------------------------------------------------------------------------------

INTRODUCTION

This Code of Ethics (the "Code") has been adopted by each registered investment
company (individually an "Investment Company" and collectively the "Investment
Companies") for which Pioneer Investment Management, Inc. ("Pioneer
Investments") serves as an investment adviser or for which Pioneer Funds
Distributor, Inc. ("PFD") serves as principal underwriter, Pioneer Investments
and PFD. The Code is applicable to Access Persons, including Independent
Trustees, of the Investment Companies, as well as Access Persons of Pioneer
Investments and PFD. Pioneer Investments, PFD and the Investment Companies are
sometimes together referred to herein as "Pioneer."

Pioneer and its affiliated entities are committed to maintaining the highest
ethical standards in connection with the management of investment companies and
institutional accounts. Dishonesty, self-dealing, conflicts of interest and
trading on material non-public information will not be tolerated.

The Code reflects Pioneer's views on dishonesty, self-dealing and conflicts of
interest. Every person who has been designated by Pioneer as an "Access Person"
is required to read the Code annually and to certify that he/she has complied
with its provisions and with the reporting requirements. In addition, every
employee of Pioneer is subject to Pioneer's Policies and Procedures to Prevent
Insider Trading.

Any person who has any question regarding the applicability of the Code or
Pioneer's Policies and Procedures to Prevent Insider Trading or the related
prohibitions, restrictions and procedures or the propriety of any action, is
urged to contact the Office of the General Counsel.

SECTION 1

STATEMENT OF POLICY

Section 17(j) of the Investment Company Act of 1940 (the "1940 Act") provides,
among other things, that it is unlawful for any Access Person of Pioneer to
engage in any act, practice or course of business in connection with the
purchase or sale, directly or indirectly, by such Access Person of any Covered
Security held or to be acquired by an Investment Company in contravention of
such rules and regulations as the Securities and Exchange Commission (the
"Commission") may adopt to define and prescribe means reasonably necessary to
prevent such acts, practices or courses of business as are fraudulent, deceptive
or manipulative.

It is the policy of Pioneer that no Access Person shall engage in any act,
practice or course of conduct that would violate the provisions of Section 17(j)
and the rules thereunder. The fundamental position of Pioneer is, and has been,
that each Access Person shall place at all times the interests of the Investment
Companies and their shareholders and the Institutional Accounts ahead of his/her
private Covered Securities transactions. Accordingly, private Covered Securities
transactions by Access Persons must be conducted in a manner consistent with
this Code so as to avoid any actual or potential conflict of interest or any
abuse of an Access Person's position of trust and responsibility. Further,
Access Persons should not take inappropriate advantage of their positions with
or relationships to any Investment Company, any Institutional Account or
Pioneer.

<PAGE>

Without limiting in any manner the fiduciary duty owed by Access Persons or the
provisions of this Code, it should be noted that Pioneer considers it proper
that purchases and sales be made by its Access Persons in the marketplace of
Covered Securities owned by the Investment Companies or Institutional Accounts;
PROVIDED, HOWEVER, that such personal Covered Securities transactions comply
with the spirit of, and the specific restrictions and limitations set forth in,
this Code. Such personal Covered Securities transactions also should be made in
amounts consistent with the normal investment practice of the Access Person
involved and with an investment, rather than a trading, outlook. Not only does
this policy encourage investment freedom and result in establishing investment
experience, but it also fosters a continuing personal interest in such
investments by those responsible for the continuous supervision of the
portfolios of the Investment Companies and Institutional Accounts. In making
personal investment decisions with respect to any Covered Security, extreme care
must be exercised by Access Persons to ensure that the prohibitions of this Code
are not violated. Further, personal investing by Access Persons should be
conducted in such a manner so as to eliminate the possibility that the Access
Person's time and attention is being devoted to his/her personal investments at
the expense of time and attention that should be devoted to management of an
Investment Company's or Institutional Account's portfolio. It should be
emphasized that technical compliance with the procedures, prohibitions and
limitations of this Code will not automatically insulate from scrutiny personal
Covered Securities transactions by an Access Person which show a pattern of
abuse of his/her fiduciary duty to any Investment Company or Institutional
Account.

SECTION 2

DEFINITIONS

2.1 ACCESS PERSON. The term "Access Person" shall mean the following:

o The term "Access Person" with respect to an Investment Company
shall mean any Trustee, officer or Advisory Person of such
Investment Company.

o The term "Access Person" with respect to Pioneer Investments shall
mean any general partner, director, officer or Advisory Person of
Pioneer Investments.

o The term "Access Person" with respect to PFD shall mean any
director or officer of PFD who in the ordinary course of business
makes, participates in or obtains information regarding the
purchase or sale of Covered Securities for an Investment Company
for which PFD acts, or whose functions or duties, in the ordinary
course of business, relate to the making of any recommendation to
an Investment Company or Institutional Account regarding the
purchase or sale of Covered Securities.

2.2 ADVISORY PERSON. The term "Advisory Person" shall mean (i) every
employee of an Investment Company, Pioneer Investments, PFD or The
Pioneer Group, Inc. ("PGI") (or any other company in a Control
relationship with Pioneer Investments) who, in connection with his or
her regular functions or duties, makes, participates in, or obtains
information regarding, the purchase or sale of a Covered Security by an
Investment Company or Institutional Account, or whose functions relate
to the making of any recommendations with respect to such purchases or
sales, (ii) every natural person in a Control relationship to an
Investment Company, Pioneer Investments, PFD or

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<PAGE>

PGI who obtains
information concerning recommendations made to an Investment Company or
Institutional Account with regard to the purchase or sale of a Covered
Security and (iii) any other employee or independent contractor of any
Investment Company, Pioneer Investments, PFD or PGI designated as an
Advisory Person by the Review Officer. Advisory Person shall not
include directors of PGI who are not also officers or employees of
Pioneer Investments, PFD, PGI or an Investment Company.

2.3 BENEFICIAL OWNERSHIP "Beneficial Ownership" of a security shall mean
having or sharing an opportunity, either directly or indirectly,
through any contract, arrangement, understanding, relationship or
otherwise, to profit or share in any profit derived from a transaction
in a security. Indirect opportunities to profit or share in any profit
would be deemed to exist as a result of, but not limited to, the
following:

o securities held by members of an Access Person's immediate family
sharing the same household (I.E., any child, stepchild,
grandchild, parent, stepparent, grandparent, spouse, sibling,
mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, sister-in-law, including adoptive relationships)
or any other individual(s) sharing the same household;

o a general partner's proportionate interest in securities held by
a general or limited partnership;

o a performance-related fee, other than an asset-based fee, received
by any broker, dealer, bank, insurance company, investment
company, investment adviser, investment manager, trustee or person
or entity performing a similar function;

o the right to dividends which is separate or separable from the
underlying security;

o an Access Person's interest in securities held by a trust; or

o an Access Person's right to acquire securities through the
exercise or conversion of any derivative security.

2.4 CONSIDERED FOR PURCHASE OR SALE. A Covered Security is being
"Considered for Purchase or Sale" by an Investment Company or
Institutional Account during any period in which Pioneer Investments
is: (i) actively trading or attempting to trade in the Covered Security
for an Investment Company or Institutional Account; (ii) passively
interested in trading in the Covered Security for an Investment Company
or Institutional Account, I.E., would buy or sell the Security within a
price range communicated to Pioneer Investments' trading department; or
(iii) considering, within an Investment Committee of Pioneer
Investments, the implementation of a trading program for the Covered
Security (including any period during which the Investment Committee is
in receipt of a recommendation with respect to which it has not yet
made a decision). With respect to a Pioneer Investments analyst, the
foregoing period shall commence on the day that he/she decides to
recommend the purchase or sale of the Covered Security to the
Investment Committee of Pioneer Investments and shall continue for a
period of three months after such date.

2.5 CONTROL. The term "Control" shall mean the power to exercise a
controlling influence over the management or policies of Pioneer
Investments, PFD or PGI, unless such power is solely the result of an
official position with Pioneer Investments, PFD or PGI, all as
determined in accordance with Section 2(a)(9) of the 1940 Act.

2.6 COVERED SECURITY. The term "Covered Security" shall have the meaning
set forth in Section 2(a)(36) of the 1940 Act and also shall include
other derivative financial instruments

3
<PAGE>

(including, but not limited to, options, futures contracts and options
on futures contracts) except that it shall not include:

o Direct obligations of the government of the United States;

o Bankers' acceptances;

o Bank certificates of deposit;

o Commercial paper;

o High quality short-term debt instruments, including repurchase
agreements (I.E., any instrument that has a maturity at issuance
of fewer than 366 days and that is rated in one of the two highest
rating categories by a Nationally Recognized Statistical Rating
Organization); or

o Shares of registered open-end investment companies, including the
Investment Companies.

(For reporting purposes, transactions in shares of Pioneer Interest
Shares must be reported.)

2.7 FIDUCIARY ACCOUNT. "Fiduciary Account" is an account with respect to
which an Access Person is an investment adviser, trustee or other
fiduciary and in which the Access Person does not otherwise have any
Beneficial Ownership interest.

2.8 INDEPENDENT TRUSTEE. "Independent Trustee" shall mean any Trustee of
an Investment Company who is not an "interested person" (within the
meaning of Section 2(a)(19) of the 1940 Act) of the Investment
Company, Pioneer Investments or PFD.

2.9 INITIAL PUBLIC OFFERING. "Initial Public Offering" shall mean an
offering of securities registered under the Securities Act of 1933, the
issuer of which, immediately before registration, was not subject to
the reporting requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934.

2.10 INSTITUTIONAL ACCOUNT. "Institutional Account" refers to any account,
other than an Investment Company, to which Pioneer Investments provides
investment advice.

2.11 INVESTMENT COMPANY. "Investment Company" refers to any U.S. registered
investment company for which Pioneer Investments serves as an
investment adviser or subadviser or for which PFD serves as principal
underwriter. "Investment Companies" refers to all such companies.

2.12 LIMITED OFFERING. "Limited Offering" shall mean an offering of
securities that is exempt from registration under the Securities Act of
1933 pursuant to Section 4(2) or Section 4(6) or pursuant to Rules 504,
505 or 506 under the Securities Act of 1933.

2.13 MATERIAL NON-PUBLIC INFORMATION. "Material Non-Public Information" with
respect to an issuer is information, not yet released to the public,
that would have a substantial likelihood of affecting a reasonable
investor's decision to buy or sell any Covered Securities of such
issuer.

4
<PAGE>

2.14 PORTFOLIO MANAGER. "Portfolio Manager" shall mean every person who is
responsible for the day-to-day management of an Investment Company or
an Institutional Account, or every person who shares such
responsibility with another Portfolio Manager.

2.15. PRECLEARANCE OFFICER. "Preclearance Officer" shall mean the officer of
Pioneer Investments designated from time to time by the Chairman of
Pioneer Investments to provide written prior approval of purchases and
sales by Access Persons. The term "Alternative Preclearance Officer"
shall mean the officer designated from time to time by the Chairman of
Pioneer Investments to provide written prior approval of purchases and
sales by the Preclearance Officer, as well as Access Persons when the
Preclearance Officer is not available, and who shall act in all
respects in the manner prescribed herein for the Preclearance Officer.

2.16 REVIEW OFFICER. "Review Officer" shall mean the officer of Pioneer
Investments designated from time to time by the Chairman of Pioneer
Investments to receive and review reports of purchases and sales by
Access Persons. The term "Alternative Review Officer" shall mean the
officer designated from time to time by the Chairman of Pioneer
Investments to receive and review the reports of purchases and sales by
the Review Officer, as well as Access Persons when the Review Officer
is not available, and who shall act in all respects in the manner
prescribed herein for the Review Officer.

SECTION 3

PROHIBITED ACTIVITIES

While the scope of actions which may violate the Statement of Policy set forth
above cannot be exactly defined, such actions would always include at least the
following prohibited activities:

3.1 Except on behalf of Fiduciary Accounts with respect to such Access
Person, no ACCESS PERSON who is not an Independent Trustee shall enter
an order for the purchase or sale of a Covered Security which an
Investment Company or Institutional Account is purchasing or selling or
considering for purchase or sale until the later of (i) the day after
the Investment Company's or Institutional Account's transaction in that
Covered Security is completed or (ii) after the Investment Company or
Institutional Account is no longer considering the Covered Security for
purchase or sale, unless the Review Officer determines, after
disclosure and review of all material information, that it is clear
that, in view of the nature of the Covered Security and the market for
such Covered Security, the order of the Access Person will not
adversely affect the price paid or received by the Investment Company
or Institutional Account and that the order of the Access Person will
not be advantaged by the transaction by the Investment Company or
Institutional Account. Any Covered Securities transactions by an Access
Person in violation of this Subsection 3.1 shall, at the discretion of
the Chairman of Pioneer Investments, be reversed, any profits disgorged
to the affected Investment Company or Institutional Account or to
charity or other appropriate sanctions imposed.

Except on behalf of Fiduciary Accounts as to which the Independent
Trustee is a fiduciary, no Independent Trustee shall enter an order for
the purchase or sale of a Covered Security if he/ she knew or, in the
ordinary course of fulfilling his/ her official duties as an
Independent Trustee, should have known, that during the 15-day period
immediately before or after the entry of such order, such Covered
Security was purchased or sold by an Investment Company, or such
Covered Security was considered by Pioneer Investments for purchase or
sale by an Investment Company.

5
<PAGE>

3.2 No ACCESS PERSON shall, directly or indirectly, purchase or sell any
Covered Security in which he/she has, or by reason of such purchase
acquires, any Beneficial Ownership interest within a period of seven
calendar days before and after any Investment Company or Institutional
Account advised by Pioneer Investments has purchased or sold such
Covered Security or within seven calendar days of the Covered Security
being recommended for purchase or sale by Pioneer Investments. Any
Covered Security transaction by an Access Person in violation of this
Subsection 3.2 shall, at the discretion of the Chairman of Pioneer
Investments, be reversed, any profits disgorged to the affected
Investment Company or Institutional Account or to charity or other
appropriate sanctions imposed. The provisions of this Subsection 3.2
are subject to a DE MINIMUS exception for Access Persons other than
Advisory Persons at the discretion of the Preclearance Officer.

3.3 No ACCESS PERSON shall purchase or sell, or cause to be purchased or
sold, any Covered Security for a Fiduciary Account as to which he/she
is a fiduciary if any such purchase or sale may, to the reasonable
knowledge of such Access Person, adversely affect the interest of an
Investment Company or Institutional Account in purchasing or selling
such Covered Security or use the transaction by an Investment Company
or Institutional Account to advantage such Fiduciary Account. Covered
Securities transactions for a Fiduciary Account which may adversely
affect an Investment Company or Institutional Account include (i)
purchases that put upward pressure on the price of a Covered Security
being purchased or considered for purchase or (ii) sales that put
downward pressure on the price of a Covered Security being sold or
considered for sale by an Investment Company or Institutional Account.

No Access Person shall be in violation of this Subsection 3.3 with
respect to:

o a transaction in a Covered Security for Fiduciary Accounts if the
aggregate number of shares included in all such transactions on
any trading day does not exceed the lesser of (x) 1% of the
outstanding shares of the Covered Security or (y) the average
weekly trading volume of shares of such Covered Security during
the four previous calendar weeks; or

o the sale of a Covered Security on behalf of a Fiduciary Account by
an Access Person acting in good faith in fulfillment of his/her
fiduciary duty to sell the Covered Security.

3.4 No ACCESS PERSON shall, directly or indirectly, without first obtaining
approval of the President of Pioneer Investments, communicate to any
person any Material Non-Public Information relating to any issuer of
any Covered Security owned by an Investment Company or Institutional
Account. No Access Person shall, directly or indirectly, without first
obtaining approval of the President of Pioneer Investments, communicate
to any person who is not an Access Person any Material Non-Public
Information relating to an Investment Company or Institutional Account,
including, without limitation, the purchase or sale or the considered
purchase or sale of a Covered Security on behalf of such Investment
Company or Institutional Account, except to the extent necessary to
effect Covered Securities transactions on behalf of such Investment
Company or Institutional Account. No Access Person shall trade on or
otherwise use any Material Non-Public Information for his /her personal
benefit or for the benefit of any other person or entity or otherwise
act in a manner detrimental to the Covered Securities transactions of
an Investment Company or Institutional Account.

3.5 No ACCESS PERSON shall engage in, or permit anyone within his /her
Control to engage in, any act, practice or course of conduct which
would operate as a fraud or deceit upon, or constitute a manipulative
practice with respect to, an Investment Company or Institutional
Account or any

6
<PAGE>

issuer of any Covered Security owned by an Investment
Company or Institutional Account or which would violate Pioneer's
Policies and Procedures to Prevent Insider Trading Violations.

3.6 No ADVISORY PERSON shall, directly or indirectly, purchase any security
pursuant to an Initial Public Offering. Access Persons (other than
Advisory Persons) shall not directly or indirectly purchase any
security pursuant to an Initial Public Offering without obtaining prior
written approval from the Preclearance Officer, after disclosure to and
review by the Preclearance Officer of all material information. Any
approval will take into account whether the investment opportunity
should be reserved for an Investment Company or Institutional Account
and whether the opportunity is being offered to Access Person by virtue
of his /her position with or relationship to an Investment Company or
Institutional Account.

3.7 No ADVISORY PERSON shall, directly or indirectly, purchase any security
sold in a Limited Offering without obtaining prior written approval
from the Preclearance Officer, after disclosure to and review by the
Preclearance Officer of all material information. Any approval will
take into account whether the investment opportunity should be reserved
for an Investment Company or Institutional Account and whether the
opportunity is being offered to such Advisory Person by virtue of his
/her position with or relationship to an Investment Company or
Institutional Account.

3.8 No ADVISORY PERSON shall accept any gift or personal benefit valued in
excess of a DE MINIMUS value (as established from time to time by the
Preclearance Officer). Any solicitation of gifts or gratuities is
unprofessional and is strictly prohibited.

3.9 No ADVISORY PERSON shall serve on the board of directors of any
publicly traded company, absent prior written authorization by the
President of Pioneer Investments and determination by the President of
Pioneer Investments that the board service would be consistent with the
interests of the Investment Companies and the Institutional Accounts.
An Advisory Person who serves on the board of directors of a publicly
traded company may not participate in the decision to purchase or sell
any Covered Securities of such company by or on behalf of any
Investment Company or Institutional Account.

3.10 No ADVISORY PERSON shall recommend any Covered Securities transaction
for any Investment Company or Institutional Account without having
previously disclosed any interest in such Covered Securities or the
issuer thereof to the President of Pioneer Investments, including
without limitation:

o his/her Beneficial Ownership of any Covered Securities of such
issuer;

o any contemplated transaction by such person in such Covered
Securities;

o any position with such issuer or its affiliates; and

o any present or proposed business relationship between such issuer
or its affiliates and such person or any party in which such
person has a significant interest.

Such interested Advisory Person may not participate in the decision by
Pioneer Investments on behalf of any Investment Company or
Institutional Account to purchase and sell Covered Securities of such
issuer.

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<PAGE>

SECTION 4

EXEMPT TRANSACTIONS AND CONDUCT

The prohibitions of Section 3 of this Code (other than Subsections 3.4 and 3.5)
shall not be deemed to be violated by any of the following transactions:

4.1 Purchases or sales of Covered Securities for an account over which the
Access Person has no direct or indirect influence or Control;

4.2 Purchases or sales of Covered Securities which are non-volitional on
the part of the Access Person;

4.3 Purchases or sales of Covered Securities pursuant to an automatic
dividend reinvestment, cash purchase or withdrawal plan provided that
no adjustment is made by the Access Person to the rate at which Covered
Securities are purchased or sold, as the case may be, under such a plan
during any period in which the Covered Security is being considered for
purchase or sale by any Investment Company or Institutional Account;

4.4 Purchases of Covered Securities effected upon the exercise of rights
issued by an issuer pro rata to all holders of a class of its Covered
Securities, to the extent such rights were acquired by the Access
Person from the issuer, and sales of such rights so acquired;

4.5 Purchases or sales of Covered Securities which receive the prior
approval of the Review Officer, after disclosure to and review by the
Review Officer of all material information and provided that such prior
approval is based on the reasonable conclusion that the proposed
purchase or sale would not be in violation of the spirit of this Code
or would not cause any injury to any Investment Company or
Institutional Account;

4.6 Purchases or sales of Covered Securities made in good faith on behalf
of another Investment Company or Institutional Account, it being
understood by, and disclosed to, the Investment Companies and
Institutional Accounts that Pioneer may make contemporaneous investment
decisions and cause to be effected contemporaneous executions on behalf
of one or more Investment Companies and Institutional Accounts and that
such executions may increase or decrease the price at which Covered
Securities are purchased or sold for the Investment Companies and
Institutional Accounts;

4.7 Tenders of Covered Securities pursuant to tender offers which are
expressly conditioned on the tender offer's acquisition of all of the
Covered Securities of the same class; and

4.8 Except as otherwise provided in Section 3.3, purchases or sales of
Covered Securities for a Fiduciary Account as to which the Access
Person is a fiduciary.

SECTION 5

POLICIES AND PROCEDURES TO PREVENT INSIDER TRADING VIOLATIONS

All employees of Pioneer or any affiliate, including Access Persons other than
Independent Trustees, are subject to Pioneer's Policies and Procedures to
Prevent Insider Trading Violations, in addition to the

8
<PAGE>

requirements of this Code. Any violation of the Insider Trading Policy
which adversely affects any Investment Company or Institutional Account shall be
deemed to be a violation of this Code.

SECTION 6

CONFIDENTIALITY

All information obtained from any Access Person hereunder shall be kept in
strict confidence by Pioneer, except that reports of Covered Securities
transactions hereunder will be made available to the Investment Companies and
Institutional Accounts and to the Commission or any other regulatory or
self-regulatory organization to the extent required by law or regulation or to
the extent Pioneer considers necessary or advisable in cooperating with an
investigation or inquiry by the Commission or any other regulatory or
self-regulatory organization.

SECTION 7

INTERPRETATION

The Board of Trustees, on behalf of an Investment Company, as well as Pioneer,
may from time to time adopt such interpretations of this Code as it deems
appropriate.

SECTION 8

EXCEPTIONS TO THE CODE

Although exceptions to the Code will rarely, if ever, be granted, Pioneer
Investments' Chairman, after consultation with the Review Officer, may make
exceptions on a case by case basis, to any of the provisions of this Code upon a
determination that the conduct at issue involves a negligible opportunity for
abuse or otherwise merits an exemption from the Code. All such exceptions must
be received in writing by the Access Person before becoming effective. The
Review Officer shall report the exception to the Board of Trustees of the
Investment Companies at the next regularly scheduled Board meeting.

SECTION 9

ADOPTION OF PROCEDURES TO ADMINISTER THE CODE

Pioneer has adopted procedures to administer the Code of Ethics and Pioneer's
Policies and Procedures to Prevent Insider Trading. Pioneer shall administer
such procedures in accordance with applicable rules and regulations adopted by
the Commission, and all Access Persons are required to comply with such
procedures.

Approved: March 7, 2000
Effective: March 7, 2000

POWER OF ATTORNEY

I, the undersigned officer or trustee of the Pioneer mutual funds
listed on Annex A, do hereby constitute and appoint John F. Cogan, Jr., David D.
Tripple, Joseph P. Barri and Eric W. Reckard, and each of them acting singly, to
be my true, sufficient and lawful attorneys, with full power to each of them and
each of them acting singly, to sign for me, in my name and the capacities
indicated below, any Registration Statement on Form N-1A, Form N-14 or any other
applicable registration form and any and all amendments thereto filed by any of
the Pioneer mutual funds of which I am now or on the date of such filing a
Trustee (each a "Trust") under the Investment Company Act of 1940, as amended,
and under the Securities Act of 1933, as amended, with respect to the offering
of its shares of beneficial interest, and any and all other documents and papers
relating thereto, and generally to do all such things in my name and on behalf
of me in the capacities indicated to enable the Trust to comply with the
Investment Company Act of 1940, as amended, and the Securities Act of 1933, as
amended, and thereunder, hereby ratifying and confirming my signature as it may
be signed by said attorneys or each of them to any and all Registration
Statements and amendments to said Registration Statement.

IN WITNESS WHEREOF, I have hereunder set my hand on this 7th day of
September, 1999.

/s/ Mary K. Bush
Mary K. Bush

/s/ Blake Eagle
Blake Eagle

/s/ Richard H. Egdahl
Richard H. Egdahl, M.D.

/s/ Margaret BW Graham
Margaret B.W. Graham

/s/ Stephen G. Kasnet
Stephen G. Kasnet

/s/ John W. Kendrick
John W. Kendrick

/s/ Marguerite A. Piret
Marguerite A. Piret

/s/ Fred N. Pratt, Jr.
Fred N. Pratt, Jr.

/s/ Stephen K. West
Stephen K. West

/s/ John Winthrop
John Winthrop

/s/ John F. Cogan, Jr.
John F. Cogan, Jr.

/s/ David D. Tripple
David D. Tripple

/s/ Eric W. Reckard
Eric W. Reckard

<PAGE>

Power of Attorney
Annex A

Pioneer International Growth Fund
Pioneer Europe Fund
Pioneer World Equity Fund
Pioneer Emerging Markets Fund
Pioneer Indo-Asia Fund
Pioneer Capital Growth Fund
Pioneer Mid-Cap Fund
Pioneer Growth Shares
Pioneer Small Company Fund
Pioneer Independence Fund
Pioneer Micro-Cap Fund
Pioneer Gold Shares
Pioneer Balanced Fund
Pioneer Equity-Income Fund
Pioneer Fund
Pioneer II
Pioneer Real Estate Shares
Pioneer Short-Term Income Trust/
Pioneer Limited Maturity Bond Fund
Pioneer America Income Trust
Pioneer Bond Fund
Pioneer Tax-Free Income Fund
Pioneer Money Market Trust
Pioneer Strategic Income Fund
Pioneer Tax-Managed Equity Fund/
Pioneer Tax-Managed Fund
Pioneer High Yield Fund
Pioneer Interest Shares
Pioneer Variable Contracts Trust