As filed with the Securities and Exchange Commission on March 12, 1998
Registration No. 333-42113
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-6
FOR REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OF SECURITIES OF UNIT INVESTMENT
TRUSTS REGISTERED ON FORM N-8B2
Pre-Effective Amendment No. 1
PIONEER INDEPENDENCE PLANS
(Exact Name of Trust)
PIONEER FUNDS DISTRIBUTOR, INC.
(Name of Depositor)
60 State Street, Boston, Massachusetts 02109-1820
(Complete Address of Depositor's Principal Executive Offices)
Robert P. Nault, Esq.
The Pioneer Group, Inc.
60 State Street
Boston, Massachusetts 02109-1820
(Name and Complete Address of Agent for Service)
Copy to:
Jeffrey S. Puretz, Esq.
Dechert Price & Rhoads
1500 K Street, N.W.
Washington, D.C. 20005
Joseph P. Barri, Esq.
Hale and Dorr LLP
60 State Street
Boston, Massachusetts 02109
Approximate date of proposed public offering: As soon as practicable after the
effective date of this registration statement.
Title of securities being registered: Pioneer Independence Plans
The registrant hereby amends this registration statement on such dates as may be
necessary to delay its effective date until the registrant shall file a further
amendment which specifically states that this registration statement shall
thereafter become effective in accordance with Section 8(a) of the Securities
Act of 1933 or until the registration statement shall become effective on such
date as the Commission, acting pursuant to Section 8(a), may determine.
<PAGE>
PIONEER INDEPENDENCE PLANS
Reconciliation and Tie of Information in Prospectus
with Items of Form N-8B-2 pursuant to
Instruction 4 of Form S-6
ITEM
NUMBER LOCATION IN PROSPECTUS OR PROSPECTUS CAPTION(S)
I. 1-9 ORGANIZATION AND GENERAL INFORMATION
1. (a) Cover Page
1. (b) Cover Page
2. The Sponsor
3. The Custodian
4. Cover Page
5. The Sponsor; The Custodian
6. (a) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; Rights and
Privileges of Planholders
6. (b) The Custodian
7. Omitted pursuant to Instruction 1 of Form S-6
8. Omitted pursuant to Instruction 1 of Form S-6
9. Omitted pursuant to Instruction 3 of Form S-6
II. GENERAL DESCRIPTION OF TRUST AND SECURITIES OF THE TRUST
10. (a) Starting a Pioneer Independence Plan
10. (b) Dividends and Distributions
10. (c) Partial Withdrawal or Redemption Without Termination of the
Plan; Systematic Withdrawal Program; Cancellation and Refund
Rights; Termination of a Plan by the Planholder and
Withdrawal of Shares
10. (d) Partial Withdrawal or Redemption Without Termination of the
Plan; Replacements of Partial Withdrawals; Systematic
Withdrawal Program; Cancellation and Refund Rights;
Termination of a Plan by the Planholder and Withdrawal of
Shares; Replacement Privilege on Termination; Transfer
or Assignment of Rights in a Plan
10. (e) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; Termination of a Plan by the Sponsor
or Custodian; Replacements of Partial Withdrawals;
Replacement Privilege on Termination
10. (f) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; Voting Rights in Fund Shares
10. (g) (1) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; Substitution of the Underlying
Investment
10. (g) (2) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; Rights and Privileges of Planholders
10. (g) (3) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; The Custodian
10. (g) (4) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives
10. (h) (1) Substitution of the Underlying Investment
10. (h) (2) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; The Custodian
<PAGE>
ITEM
NUMBER LOCATION IN PROSPECTUS OR PROSPECTUS CAPTION(S)
10. (h) (3) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; The Custodian
10. (h) (4) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives
10. (i) Planholders May Qualify for Reduced Sales Charges; Making
Investments Ahead of Schedule to Complete a Plan Early;
Changing the Face Amount of Your Plan; Extended Investment
Option; Dividends and Distributions; Statements, Reports and
Notices
11. Investment Objective of the Fund
12. (a) Cover Page; Investment Objective of the Fund; The Fund
12. (b) Omitted pursuant to Instruction 3 of Form S-6
12. (c) Fund's Prospectus accompanying the Prospectus for the Plans
12. (d) Fund's Prospectus accompanying the Prospectus for the Plans
12. (e) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (A) (1) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; Service Charges and Other Fees
13. (a) (A) (2) The Fund
13. (a) (A) (3) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (A) (4) Dividends and Distributions
13. (a) (A) (5) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (B) (1) 15-Year Plan Investments and Deductions; Total 25-Year Plan
Investments and Deductions when Extended Investment Option
is Used; A Typical $100 Monthly Investment Plan; other
relevant information under Plan Investments and Deductions
13. (a) (B) (2) Fund Annual Expenses (After Expense Limitation); other
relevant information under Plan Investments and Deductions;
Fund's Prospectus accompanying the Prospectus for the Plans
13. (a) (B) (3) Service Charges and Other Fees
13. (a) (B) (4) Service Charges and Other Fees
13. (a) (B) (5) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (C) (1) Service Charges and Other Fees
13. (a) (C) (2) Fund's Prospectus accompanying the Prospectus for the Plans
13. (a) (C) (3) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (C) (4) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (C) (5) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (D) (1) Creation and Sales Charges; Service Charges and Other Fees
13. (a) (D) (2) Fund Annual Expenses (After Expense Limitation); other
relevant information under Plan Investments and Deductions;
Fund's Prospectus accompanying the Prospectus for the Plans
13. (a) (D) (3) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (D) (4) Omitted pursuant to Instruction 3 of Form S-6
13. (a) (D) (5) Omitted pursuant to Instruction 3 of Form S-6
13. (b) 15-Year Plan Investments and Deductions; Total 25-Year Plan
Investments and Deductions when Extended Investment Option
is Used; A Typical $100 Monthly Investment Plan; other
relevant information under Plan Investments and Deductions
13. (c) 15-Year Plan Investments and Deductions; Total 25-Year Plan
Investments and Deductions when Extended Investment Option
is Used; A Typical $100 Monthly Investment Plan; other
relevant information under Plan Investments and Deductions;
Planholders May Qualify for Reduced Sales Charges; Changing
the Face Amount of Your Plan
13. (d) 15-Year Plan Investments and Deductions; Total 25-Year Plan
Investments and Deductions when Extended Investment Option
is Used; Purchasing Two or More Plans; Rights of
Accumulation
<PAGE>
ITEM
NUMBER LOCATION IN PROSPECTUS OR PROSPECTUS CAPTION(S)
13. (e) Service Charges and Other Fees
13. (f) Omitted pursuant to Instruction 3 of Form S-6
13. (g) Omitted pursuant to Instruction 3 of Form S-6
14. Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives; Starting a Pioneer Independence Plan;
Rights and Privileges of Planholders
15. Cover Page; Pioneer Independence Plans--Helping Planholders
Meet their Investment Objectives;
Starting a Pioneer Independence Plan; Rights and Privileges
of Planholders
16. Investment Objective of the Fund; Substitution of the
Underlying Investment; The Custodian
17. (a) Partial Withdrawal or Redemption Without Termination of the
Plan; Systematic Withdrawal Program; Cancellation and Refund
Rights; Termination of a Plan by the Planholder and
Withdrawal of Shares
17. (b) Cover Page; Starting a Pioneer Independence Plan; The
Custodian; Fund's Prospectus accompanying the Prospectus for
the Plans
17. (c) Making Investments Ahead of Schedule to Complete a Plan
Early; Extended Investment Option; Termination of a Plan by
the Sponsor or Custodian
18. (a) Omitted pursuant to Instruction 3 of Form S-6
18. (b) Dividends and Distributions
18. (c) Omitted pursuant to Instruction 3 of Form S-6
18. (d) Omitted pursuant to Instruction 3 of Form S-6
19. Statements, Reports and Notices; Taxes; The Custodian
20. (a) The Custodian
20. (b) The Custodian
20. (c) The Custodian
20. (d) Omitted pursuant to Instruction 3 of Form S-6
20. (e) Omitted pursuant to Instruction 3 of Form S-6
20. (f) Omitted pursuant to Instruction 3 of Form S-6
21. (a) Omitted pursuant to Instruction 3 of Form S-6
21. (b) Omitted pursuant to Instruction 3 of Form S-6
21. (c) Omitted pursuant to Instruction 3 of Form S-6
22. Custodian Agreement (exhibit)
23. Response set forth in Form N-8B-2 only
24. Omitted pursuant to Instruction 3 of Form S-6
III. ORGANIZATION, PERSONNEL AND AFFILIATED PERSONS OF DEPOSITOR
25. The Sponsor
26. (a) Omitted pursuant to Instruction 3 of Form S-6
26. (b) (1) Fund's Prospectus accompanying the Prospectus for the Plans
26. (b) (2) Fund's Prospectus accompanying the Prospectus for the Plans
26. (b) (3) The Fund; Fund's Prospectus accompanying the Prospectus for
the Plans
26. (b) (4) Omitted pursuant to Instruction 3 of Form S-6
27. The Sponsor; Fund's Prospectus accompanying the Prospectus
for the Plans
28. The Sponsor
29. The Sponsor
30. Omitted pursuant to Instruction 3 of Form S-6
<PAGE>
ITEM
NUMBER LOCATION IN PROSPECTUS OR PROSPECTUS CAPTION(S)
31. Omitted pursuant to Instruction 3 of Form S-6
32. Omitted pursuant to Instruction 3 of Form S-6
33. Omitted pursuant to Instruction 3 of Form S-6
34. Omitted pursuant to Instruction 3 of Form S-6
IV. DISTRIBUTION AND REDEMPTION OF SECURITIES
35. (A) Omitted pursuant to Instruction 3 of Form S-6
35. (B) Pioneer Independence Plans
35. (C) Omitted pursuant to Instruction 3 of Form S-6
36. Omitted pursuant to Instruction 3 of Form S-6
37. Omitted pursuant to Instruction 3 of Form S-6
38. (a) The Sponsor
38. (b) The Sponsor
38. (c) Pioneer Independence Plans--Helping Planholders Meet their
Investment Objectives
39. (a) The Sponsor
39. (b) The Sponsor
40. Omitted pursuant to Instruction 3 of Form S-6
41. (a) The Sponsor; Fund's Prospectus accompanying the Prospectus
for the Plans
41. (b) Omitted pursuant to Instruction 1 of Form S-6
41. (c) Omitted pursuant to Instruction 1 of Form S-6
42. Omitted pursuant to Instruction 3 of Form S-6
43. Omitted pursuant to Instruction 3 of Form S-6
44. (a) Fund's Prospectus accompanying the Prospectus for the Plans
44. (b) Omitted pursuant to Instruction 3 of Form S-6
44. (c) 15-Year Plan Investments and Deductions; Total 25-Year Plan
Investments and Deductions when Extended Investment Option
is Used; Purchasing Two or More Plans; Rights of
Accumulation
45. Omitted pursuant to Instruction 3 of Form S-6
46. (a) Fund's Prospectus accompanying the Prospectus for the Plans
46. (b) Omitted pursuant to Instruction 3 of Form S-6
47. Investment Objective of the Fund; Substitution of the
Underlying Investment; The Custodian
V. INFORMATION CONCERNING THE TRUSTEE OR CUSTODIAN
48. The Custodian
49. Service Charges and Other Fees
50. Omitted pursuant to Instruction 3 of Form S-6
VI. INFORMATION CONCERNING INSURANCE OF HOLDERS OF SECURITIES
51. Omitted pursuant to Instruction 3 of Form S-6
VII. POLICY OF REGISTRANT/REGULATED INVESTMENT COMPANY
52. (a) Substitution of the Underlying Investment
52. (b) Omitted pursuant to Instruction 3 of Form S-6
52. (c) (1) Substitution of the Underlying Investment
52. (c) (2) Substitution of the Underlying Investment
<PAGE>
ITEM
NUMBER LOCATION IN PROSPECTUS OR PROSPECTUS CAPTION(S)
52. (c) (3) Omitted pursuant to Instruction 3 of Form S-6
52. (c) (4) Substitution of the Underlying Investment
52. (c) (5) Substitution of the Underlying Investment
52. (d) Omitted pursuant to Instruction 3 of Form S-6
53. Taxes; Fund's Prospectus accompanying the Prospectus for the
Plans
VIII. FINANCIAL AND STATISTICAL INFORMATION
54. Omitted pursuant to Instruction 3 of Form S-6
55. A Typical $100 Monthly Investment Plan
56. Omitted pursuant to Instruction 1 of Form S-6
57. Omitted pursuant to Instruction 1 of Form S-6
58. Omitted pursuant to Instruction 1 of Form S-6
59. (a)(1) Balance Sheet at February 20, 1998
59. (a)(2) Not applicable
59. (c)(1) Consolidated Statement of Financial Condition at
December 31, 1997
59. (c)(2) Consolidated Statement of Operations at
December 31, 1997
<PAGE>
Pioneer
Independence
Plans
PROSPECTUS
MARCH 12, 1998
Pioneer Independence Plans (the "Plans") for the accumulation of shares
of Pioneer Independence Fund (the "Fund") are offered by Pioneer Funds
Distributor, Inc., the sponsor and principal underwriter ("Sponsor"). Under a
Plan, an investor (the "Planholder") makes fixed monthly investments for 15
years (a total of 180 investments), with the option to make additional monthly
investments for up to a total of 25 years (a total of 300 investments). The
Plans are designed to help investors create an investment fund for future
capital or income needs and build equity over a period of years by
systematically investing a modest sum each month in shares of a mutual fund.
Investments under a Plan are applied, after authorized deductions, to
the purchase of Fund shares at net asset value. A Plan should be considered a
long-term investment and is not suitable for investors seeking quick profits or
who might be unable to complete a Plan. A front-end sales load, the "Creation
and Sales Charge," is deducted from the first 12 investments. Because of the
Creation and Sales Charge, withdrawal of an investment or termination of a Plan
during the period in which the first 12 investments in a Plan are made will
probably result in a loss to the investor.
The value of a Plan is subject to fluctuations in the value of the
shares of the Fund, which in turn is based upon the value of the securities in
its portfolio. The Fund's investment results will vary depending on the
composition of its portfolio, market conditions and the Fund's operating
expenses. See "Investment Objective and Policies" in the Fund's Prospectus. A
Plan calls for monthly investments at regular intervals regardless of the
price level of the Fund shares. Planholders should therefore consider their
financial ability to continue investments in a Plan. Terminating a Plan at a
time when the value of the Fund shares then held is less than the Planholder's
cost associated with a Plan will result in a loss to the Planholder.
FUND RETURNS AND SHARE PRICES FLUCTUATE AND THE VALUE OF YOUR FUND SHARES
UPON REDEMPTION MAY BE MORE OR LESS THAN YOUR PURCHASE PRICE. SHARES IN THE FUND
ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, ANY BANK OR
OTHER DEPOSITORY INSTITUTION, AND THE SHARES ARE NOT FEDERALLY INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
GOVERNMENT AGENCY.
SHARES OF THE FUND ARE OFFERED TO THE GENERAL PUBLIC ONLY THROUGH THE
PLANS.
A PLANHOLDER HAS THE RIGHT TO A 45-DAY REFUND OF THE VALUE OF HIS OR HER
INVESTMENT, AS WELL AS CERTAIN OTHER LIMITED REFUND RIGHTS FOR CERTAIN PERIODS
OF TIME AND UNDER THE CONDITIONS DESCRIBED IN MORE DETAIL UNDER "CANCELLATION
AND REFUND RIGHTS."
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS IS VALID ONLY IF ACCOMPANIED BY THE CURRENT PROSPECTUS
OF THE FUND, WHICH CONTAINS A DESCRIPTION OF THE FUND. BOTH PROSPECTUSES SHOULD
BE READ AND RETAINED FOR FUTURE REFERENCE.
<PAGE>
TABLE OF CONTENTS PAGE
- --------------------------------------------------------------------------------
I. PIONEER INDEPENDENCE PLANS -- HELPING PLANHOLDERS MEET THEIR
INVESTMENT OBJECTIVES...................................................3
II. PLAN INVESTMENTS AND DEDUCTIONS.........................................3
III. 15-YEAR PLAN INVESTMENTS AND DEDUCTIONS.................................4
IV. TOTAL 25-YEAR PLAN INVESTMENTS AND DEDUCTIONS WHEN EXTENDED
INVESTMENT OPTION IS USED...............................................5
V. A TYPICAL $100 MONTHLY INVESTMENT SCHEDULE..............................5
VI. INVESTMENT OBJECTIVE OF THE FUND........................................5
VII. STARTING A PIONEER INDEPENDENCE PLAN....................................5
VIII. CREATION AND SALES CHARGES..............................................6
IX. RIGHTS AND PRIVILEGES OF PLANHOLDERS....................................6
Automatic Investment Option........................................6
Planholders May Qualify for Reduced Sales Charges..................6
Making Investments Ahead of Schedule to Complete a Plan Early......6
Changing the Face Amount of Your Plan..............................7
Partial withdrawal or Redemption Without Termination of the Plan...8
Replacements of Partial Withdrawals................................8
Extended Investment Option.........................................8
Systematic Withdrawal Program......................................8
Cancellation and Refund Rights.....................................8
Termination of a Plan by the Planholder and Withdrawal of Shares...9
Replacement Privilege on Termination...............................9
Dividends and Distributions........................................9
Voting Rights in Fund Shares......................................10
Transfer or Assignment of Rights in a Plan........................10
Statements, Reports and Notices...................................10
X. TERMINATION OF A PLAN BY THE SPONSOR OR CUSTODIAN......................10
XI. SERVICE CHARGES AND OTHER FEES.........................................10
XII. TAXES..................................................................11
XIII. THE FUND...............................................................11
XIV. SUBSTITUTION OF THE UNDERLYING INVESTMENT..............................11
XV. RETIREMENT PLANS.......................................................12
XVI. THE SPONSOR............................................................12
XVII. THE CUSTODIAN..........................................................13
XVIII. PIONEER INDEPENDENCE PLANS.............................................13
XIX. FINANCIAL STATEMENTS...................................................14
Pioneer Independence Plans........................................14
Pioneer Funds Distributor, Inc....................................16
2
<PAGE>
I. PIONEER INDEPENDENCE PLANS -- HELPING PLANHOLDERS MEET THEIR INVESTMENT
OBJECTIVES
Many people who desire to accumulate an investment portfolio for their
future through a planned long-range investment program find it difficult to
accumulate enough money to efficiently purchase stocks directly. The Plans are
designed to help investors create an investment fund for future capital or
income needs and build equity over a period of years by systematically investing
a modest sum each month in shares of a mutual fund.
The value of a Plan is subject to fluctuations in the value of the
securities in the underlying Fund's portfolio. The Planholder makes monthly Plan
investments at regular intervals regardless of the price level of the shares of
the Fund. Planholders should consider, therefore, their financial ability to
initiate and continue a Plan. Ownership of a Plan does not eliminate the risk
inherent in the ownership of any security. Terminating a Plan at a time when the
value of acquired Fund shares held in the Plan is less than the Planholder's
original cost for Fund shares held under the Plan will result in a loss to the
Planholder.
An investor should consider the following aspects of the Plan before
making an investment:
1. A Plan represents an agreement between the Planholder, the Sponsor,
and State Street Bank and Trust Company (the "Custodian") under which
amounts invested (after deduction of Creation and Sales Charges and
other fees) are used to purchase shares of the Fund at net asset
value.
2. Each Plan includes a Creation and Sales Charge, which is sometimes
called a "front-end load" sales charge, equal to a maximum of 50% of
the first 12 investments. The effect of a front-end load is that if
you terminate your Plan between the second and eighteenth month, total
deductions may amount to as much as 15% of your total Plan investments
made up to that date and as much as 31.6% after 18 months. However,
the maximum Creation and Sales Charge for a 15-year Plan is only 3.33%
when expressed as a percentage of the total Plan investments.
Accordingly, a Plan is not suited for short-term investments. See
"Creation and Sales Charges."
3. Investments under a Plan will not constitute direct ownership of Fund
shares, but rather an interest in a trust which will have direct
ownership of the Fund's shares on behalf of each Planholder.
Planholders have only a beneficial interest in the underlying shares
of the Fund. A Planholder will, however, retain full voting rights
with respect to such underlying shares of the Fund. The Custodian will
vote the shares held for Planholders' accounts in accordance with
their instructions.
4. A Plan may be terminated by the Custodian or Sponsor if a
Planholder fails to make investments under his or her Plan for a
period of 12 consecutive months or if Fund shares are not available
and a substitution is not made. See "Termination of a Plan by the
Sponsor or Custodian." Planholders must be notified of any
substitution of the Plan's underlying investment. See "Substitution of
the Underlying Investment."
5. The dealer firm of record has proprietary rights to all commissions,
including any service fees, earned from the Sponsor during the
duration of your Plan. The dealer firm of record is under no
obligation to transfer your Plan to another dealer firm as long
as its dealer agreement with the Sponsor is still in effect;
thus, a new dealer engaged by a Planholder may have no direct
incentive to provide services with respect to the Plan. If the
dealer firm of record chooses to release a Plan to a new dealer
firm, the new dealer firm must first complete, sign and signature
guarantee a release form that can be obtained from the Sponsor.
The form must be returned to and accepted by the Custodian.
6. The Sponsor is not required to notify Planholders or seek their
approval prior to replacing the Custodian. The terms of the
Custodian Agreement, however, cannot be amended to adversely
affect the rights and privileges of a Planholder without
obtaining his or her written consent.
II. PLAN INVESTMENTS AND DEDUCTIONS
The following tables show the range of available monthly Plan
investments to be made, total Plan investments (known as the "face amount" of
the Plan) to be made and the Creation and Sales Charges that will be charged on
each monthly Plan investment. The total charges as a percentage of the total
amount invested under a Plan and as a percentage of the net amount invested are
also shown. This information is based solely on investments made under a Plan
and does not reflect any investment experience, dividend or income from the Fund
over the period of a Plan, or expenses of the Fund or any other charges.
The Creation and Sales Charges reflected below are specified under the
Plans and may not be increased. The Fund also incurs expenses as described under
"The Fund." Fund expenses are not specified under the terms of the Plans and may
vary from year to year.
3
<PAGE>
<TABLE>
<CAPTION>
III. 15-YEAR PLAN INVESTMENTS AND DEDUCTIONS
CREATION AND SALES CHARGE
----------------------------------------------------------
PER TO NET
MONTHLY PER INVEST- TOTAL TO INVEST- MONTHLY
PLAN TOTAL INVEST- MENT SALES TOTAL MENT PLAN
INVEST- INVEST- MENT 13 THRU CHARGE INVEST- IN INVEST-
MENT MENT 1 THRU 12 180 (A) MENT SHARES MENT
- ---------- ------------- --------- -------- ------------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 50.00 $ 9,000.00 $ 25.00 $0 $ 300.00 3.33% 3.45% $ 50.00
75.00 13,500.00 37.50 0 450.00 3.33% 3.45% 75.00
100.00 18,000.00 50.00 0 600.00 3.33% 3.45% 100.00
125.00 22,500.00 62.50 0 750.00 3.33% 3.45% 125.00
150.00 27,000.00 75.00 0 900.00 3.33% 3.45% 150.00
166.66 29,998.80 83.33 0 999.96 3.33% 3.45% 166.66
200.00 36,000.00 100.00 0 1,200.00 3.33% 3.45% 200.00
250.00 45,000.00 125.00 0 1,500.00 3.33% 3.45% 250.00
300.00 54,000.00 150.00 0 1,800.00 3.33% 3.45% 300.00
350.00 63,000.00 175.00 0 2,100.00 3.33% 3.45% 350.00
400.00 72,000.00 200.00 0 2,400.00 3.33% 3.45% 400.00
450.00 81,000.00 225.00 0 2,700.00 3.33% 3.45% 450.00
500.00 90,000.00 250.00 0 3,000.00 3.33% 3.45% 500.00
600.00 108,000.00 300.00 0 3,600.00 3.33% 3.45% 600.00
700.00 126,000.00 350.00 0 4,200.00 3.33% 3.45% 700.00
800.00 144,000.00 400.00 0 4,800.00 3.33% 3.45% 800.00
900.00 162,000.00 450.00 0 5,400.00 3.33% 3.45% 900.00
1,000.00 180,000.00 500.00 0 6,000.00 3.33% 3.45% 1,000.00
1,250.00 225,000.00 625.00 0 7,500.00 3.33% 3.45% 1,250.00
1,500.00 270,000.00 675.00 0 8,100.00 3.00% 3.09% 1,500.00
1,750.00 315,000.00 700.00 0 8,400.00 2.67% 2.74% 1,750.00
2,000.00 360,000.00 750.00 0 9,000.00 2.50% 2.56% 2,000.00
2,500.00 450,000.00 812.50 0 9,750.00 2.17% 2.21% 2,500.00
5,000.00 900,000.00 1,250.00 0 15,000.00 1.67% 1.69% 5,000.00
10,000.00 1,800,000.00 1,500.00 0 18,000.00 1.00% 1.01% 10,000.00
</TABLE>
(A) Does not include an annual distribution and service fee paid by the Fund of
up to 0.25% based on the Fund's average daily net assets. See "Distribution
Plan" in the Fund's Prospectus.
<TABLE>
<CAPTION>
IV. TOTAL 25-YEAR PLAN INVESTMENTS AND DEDUCTIONS WHEN
EXTENDED INVESTMENT OPTION IS USED
CREATION AND SALES CHARGE
-------------------------------------------------------
PER TO NET
MONTHLY PER INVEST- TOTAL TO INVEST- MONTHLY
PLAN TOTAL INVEST- MENT SALES TOTAL MENT PLAN
INVEST- INVEST- MENT 13 THRU CHARGE INVEST- IN INVEST-
MENT MENT 1 THRU 12 300 (A) MENT SHARES MENT
- ---------- ------------- --------- -------- ---------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 50.00 $ 15,000.00 $ 25.00 $0 $ 300.00 2.00% 2.04% $ 50.00
75.00 22,500.00 37.50 0 450.00 2.00% 2.04% 75.00
100.00 30,000.00 50.00 0 600.00 2.00% 2.04% 100.00
125.00 37,500.00 62.50 0 750.00 2.00% 2.04% 125.00
150.00 45,000.00 75.00 0 900.00 2.00% 2.04% 150.00
166.66 49,998.00 83.33 0 999.96 2.00% 2.04% 166.66
200.00 60,000.00 100.00 0 1,200.00 2.00% 2.04% 200.00
250.00 75,000.00 125.00 0 1,500.00 2.00% 2.04% 250.00
300.00 90,000.00 150.00 0 1,800.00 2.00% 2.04% 300.00
350.00 105,000.00 175.00 0 2,100.00 2.00% 2.04% 350.00
400.00 120,000.00 200.00 0 2,400.00 2.00% 2.04% 400.00
450.00 135,000.00 225.00 0 2,700.00 2.00% 2.04% 450.00
500.00 150,000.00 250.00 0 3,000.00 2.00% 2.04% 500.00
600.00 180,000.00 300.00 0 3,600.00 2.00% 2.04% 600.00
700.00 210,000.00 350.00 0 4,200.00 2.00% 2.04% 700.00
800.00 240,000.00 400.00 0 4,800.00 2.00% 2.04% 800.00
900.00 270,000.00 450.00 0 5,400.00 2.00% 2.04% 900.00
1,000.00 300,000.00 500.00 0 6,000.00 2.00% 2.04% 1,000.00
1,250.00 375,000.00 625.00 0 7,500.00 2.00% 2.04% 1,250.00
1,500.00 450,000.00 675.00 0 8,100.00 1.80% 1.83% 1,500.00
1,750.00 525,000.00 700.00 0 8,400.00 1.60% 1.63% 1,750.00
2,000.00 600,000.00 750.00 0 9,000.00 1.50% 1.52% 2,000.00
2,500.00 750,000.00 812.50 0 9,750.00 1.30% 1.32% 2,500.00
5,000.00 1,500,000.00 1,250.00 0 15,000.00 1.00% 1.01% 5,000.00
10,000.00 3,000,000.00 1,500,00 0 18,000.00 0.60% 0.60% 10,000.00
</TABLE>
(A) Does not include an annual distribution and service fee paid by the Fund of
up to 0.25% based on the Fund's average daily net assets. See "Distribution
Plan" in the Fund's Prospectus.
4
<PAGE>
V. A TYPICAL $100 MONTHLY INVESTMENT PLAN
(Assuming that all investments are made in accordance
with the terms of Pioneer Independence Plans)
<TABLE>
<CAPTION>
AT THE END OF AT THE END OF AT THE END OF
AGGREGATE 6 MONTHS 1 YEAR 2 YEARS
AMOUNT (6 INVESTMENTS) (12 INVESTMENTS) (24 INVESTMENTS)
----------------------- ------------------------- ------------------------ ------------------------
% % % %
of Total of Total of Total of Total
Amount Investment Amount Investment Amount Investment Amount Investment
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
15 YEARS
(180 INVESTMENTS)
Total Investments $18,000 100.00% $600 100% $1,200 100% $2,400 100%
Deduct:
Creation and
Sales Charge $600 3.33% $300 50% $600 50% $600 25%
Net Amount Invested
in a Plan $17,400 96.67% $300 50% $600 50% $1,800 75%
25 YEARS
(300 INVESTMENTS)
Total Investments $30,000 100.00% $600 100% $1,200 100% $2,400 100%
Deduct:
Creation and
Sales Charge $600 2.00% $300 50% $600 50% $600 25%
Net Amount Invested
in a Plan $29,400 98.00% $300 50% $600 50% $1,800 75%
</TABLE>
(1) Dividends and distributions received on Fund shares, during the periods
shown, have not been included or reflected in any way in the foregoing
figures.
(2) The 25-year investment schedule reflects the charges applicable to a
15-year Plan which is continued under the extended investment option.
FUND ANNUAL EXPENSES (AFTER EXPENSE LIMITATION)
(as a percentage of the Fund's average daily net assets)
Management Fee (after fee waiver). . . . . . 0.00%
12b-1 Fee . . . . . . . . . . . . . . . . . 0.25%
Other Expenses (estimated) . . . . . . . 1.25%
----
Total Expenses (after fee waiver) . . . . . 1.50%
====
Pioneering Management Corporation, the Fund's investment adviser, has
agreed not to impose all or a portion of its management fee and to make other
arrangements, if necessary, to limit the operating expenses of the Fund to 1.50%
of the Fund's average daily net assets. Absent the fee waiver, management fee
and total expenses would be 0.75% and 2.20%, respectively. This agreement is
voluntary and temporary and may be revised or terminated at any time after the
expiration of the 1998 fiscal year. For a discussion of Fund expenses, refer to
"Expense Information" and "Management of the Fund" in the Fund's Prospectus.
VI. INVESTMENT OBJECTIVE OF THE FUND
Pioneer Independence Fund ("the Fund") is an open-end management
investment company. The Fund seeks growth of capital. The Fund will invest in
a diversified portfolio of securities consisting primarily of common stocks. For
more information about the Fund, including charges and expenses, see the
attached Fund Prospectus. Read it carefully before you invest or send money.
Fund returns and share prices fluctuate and, upon redemption, the value of the
Fund shares held in a Plan may be more or less than the purchase price. The past
performance of an investment does not guarantee future results.
VII. STARTING A PIONEER INDEPENDENCE PLAN
To start a Plan, complete the attached Plan Application indicating the
monthly Plan investment amount for your Plan. Because a Plan is specifically
designed for regular monthly investing, you are encouraged to invest through an
automatic investment option such as military government allotment or a
preauthorized check transaction (a "PACT").
To elect an automatic investment option complete the required forms and
have your investment dealer forward them to the Custodian. See "Automatic
Investment Option."
To invest by check, have your investment dealer send your check to the
Custodian with your Plan Application. Write your check for the amount of your
initial monthly Plan investment and make it payable to State Street Bank and
Trust Company. As described in "Service Charges and Other Fees," a separate
processing fee may be charged for each investment made by check.
After your Plan Application is accepted by the Custodian and your initial
investment is received, you will receive a confirmation statement showing the
number of whole and fractional shares of the Fund purchased for your Plan. After
the initial investment, Planholders should send regularly scheduled monthly Plan
investments, made payable to State Street Bank and Trust Company, directly to
the Custodian. Each monthly Plan investment, after applicable deductions, will
be applied to the purchase of Fund shares at the then current net asset value.
If the Custodian does not receive monthly Plan investments for a period of 12
consecutive months, then the Sponsor or Custodian may terminate your Plan as
described under "Termination of a Plan by the Sponsor or Custodian."
A Planholder may terminate a Plan completely or partially at any time as
described on pages 7 and 9. Any correspondence regarding your Plan should be
addressed to your investment dealer or to Boston Financial Data Services, P.O.
Box 8300, Boston, Massachusetts 02266-8300.
VIII. CREATION AND SALES CHARGES
The Sponsor receives a Creation and Sales Charge as compensation for
its services and costs in creating the Plans
5
<PAGE>
and arranging for their administration, for making the Fund shares
available to Planholders at their net asset value and for certain selling
expenses and commissions with respect to the Plans. These charges are deducted
from each of the first 12 monthly Plan investments. For example, on a $100 a
month Plan, $50 is deducted from each of the first 12 monthly Plan investments.
After the 12th investment, Creation and Sales Charges no longer apply to
subsequent monthly investments. Deductions will decrease proportionately on
certain larger Plans. See "Plan Investments and Deductions."
IX. RIGHTS AND PRIVILEGES OF PLANHOLDERS
A Plan is established in the name of the Planholder at the time of
issuance and constitutes an individual agreement among the Planholder, the
Sponsor and the Custodian. No agent or other person has the authority to modify,
alter or otherwise change the terms of the Plan or to bind the Sponsor, the
Custodian or the issuer of Fund shares by any statement, written or oral, not
contained in this Prospectus. Under the terms of a Plan, Planholders enjoy
certain rights, privileges and options which are described as follows.
AUTOMATIC INVESTMENT OPTION
If a Planholder wishes to have investments in a Plan made automatically
each month without having to write a check and mail it to the Custodian, the
Planholder may elect an automatic investment option for the Plan. Each Plan for
which an automatic investment option has been elected is funded automatically
each month through the Planholder's bank account, PACT or, for U.S. military
personnel, a government allotment. To initiate an automatic investment option,
the Planholder should complete the appropriate forms and forward them to the
Custodian. A request to terminate a PACT must be received by the Custodian at
least 15 days prior to the date of the next scheduled monthly Plan investment.
PLANHOLDERS MAY QUALIFY FOR REDUCED SALES CHARGES
To qualify for reduced Creation and Sales Charges, the Planholder must
submit a written request that the face amounts of existing Plans and/or the then
current net asset value of other Pioneer mutual fund accounts be combined with
the face amounts indicated on any new Plan applications for the purpose of
determining the applicable Creation and Sales Charge for the new Plan(s).
PURCHASING TWO OR MORE PLANS. The face amounts of two or more Plans
purchased at one time by "any person" (see below) may be combined to take
advantage of the lower Creation and Sales Charges available on larger sized
Plans. Creation and Sales Charges will be determined by the face amounts of the
Plans selected.
The term "any person" includes:
[bullet] an individual, his or her spouse and their children under the
age of 21 and their grandchildren under age 21 who are
beneficiaries of a Uniform Gifts to Minors Act or Uniform
Transfers to Minors Act account in which the Planholder serves as
custodian, or
[bullet] a trustee or other fiduciary of a single trust estate or single
fiduciary account (including a pension, profit-sharing or other
employee benefit trust created pursuant to a plan qualified
under Section 401 of the Internal Revenue Code of 1986, as
amended (the "Code")).
RIGHTS OF ACCUMULATION. When purchasing any new Plan(s) or increasing the
face amount of any existing Plan(s), a right of accumulation may exist. If such
Plans are registered in the name of "any person" (see above), the Plans may
qualify for a reduced Creation and Sales Charge on the new Plan by combining the
face amount of the new Plan with the face amount(s) of any existing Plan(s) on
which investments due are current (see below) and/or with the current value of
shares owned in certain other Pioneer mutual funds for which Pioneering
Management Corporation or an affiliate is the investment manager.
The new Plan includes the total face amounts of any new Plans plus the face
amounts of Plans on which an increase in monthly investments is requested. For
rights of accumulation, a Plan is considered to be current if: (1) it has been
completed and not redeemed; (2) it has not been completed but has at least as
many investments recorded as there are months elapsed since the establishment
date or since a Plan face amount increase date; or (3) the Planholder is a tax-
qualified plan or an individual retirement account ("IRA").
MAKING INVESTMENTS AHEAD OF SCHEDULE TO COMPLETE A PLAN EARLY
A Planholder may complete his or her Plan ahead of schedule by making
monthly Plan investments in advance of their normal due date, but the Planholder
may not normally make more than 24 investments in any one calendar year
(including the current investment). In addition to these investments made in
advance of their scheduled dates, a Planholder may make an additional 24
investments during the life of the Plan. Monthly Plan investments may be
combined and periodically paid in a lump sum to make a Plan that is in arrears
current (see "Rights of Accumulation"). These prepayment rules may be waived for
a transfer or rollover of an IRA into a Plan or in the event of the death of the
Planholder. There is no reduction in the Creation and Sales Charge for advance
investments.
CHANGING THE FACE AMOUNT OF YOUR PLAN
The face amount of a Plan is the total value of the monthly Plan
investments scheduled by the Planholder to be made in his or her Plan. The range
of face amounts offered is listed under "Plan Investments and Deductions."
Increases and decreases in face amount can be made by a written notice to the
Custodian, accompanied by a new completed Plan Application. A Planholder may
change the face amount of a Plan under the following circumstances.
A Planholder may increase the face amount of his or her Plan at any
time, provided the new face amount is a face amount offered by the Sponsor. An
increase in the face amount of a Plan does not create new cancellation and
refund rights as to the new Plan that is created.
A Planholder may decrease the face amount of his or her Plan by 50% within
12 investments of the commencement of a Plan. If a decrease is to occur on an
existing Plan that previously has been increased, the decrease cannot result in
a new face amount lower than that of the original Plan.
6
<PAGE>
For each face amount change, the Creation and Sales Charge already paid
on the existing Plan will be recomputed to reflect the new Plan face amount. The
Creation and Sales Charges already paid on the existing Plan will be credited to
the Creation and Sales Charge applicable to the new face amount. Excess Creation
and Sales Charges under a Plan will be invested directly in Fund shares for the
Planholder at the net asset value as of the day the change occurs. Any
additional Creation and Sales Charges due under a Plan will be assessed on the
next 12 monthly Plan investments.
PARTIAL WITHDRAWAL OR REDEMPTION WITHOUT TERMINATION OF THE PLAN
A Planholder may request a partial withdrawal or redemption of his or
her Fund shares without terminating the Plan, only if the Planholder has owned
his or her Plan for at least 45 days. Withdrawal or redemption of all of a
Planholder's Fund shares will normally result in termination of the Plan.
For Plans that have been owned for at least 45 days, the Planholder may
elect to withdraw up to 90% of the underlying Fund shares from his or her Plan
(and hold such Fund shares directly) or may direct the Custodian, as the
Planholder's agent, to withdraw and then redeem up to 90% of the Planholder's
Fund shares and pay the proceeds to the Planholder. Requests under this
privilege that exceed 90% of the net asset value of the Fund shares in the
Planholder's account may result in full redemption of the entire balance in the
Plan.
A request for a partial withdrawal or redemption may be made in writing
or by telephone. While there is currently no limit to the number of partial
withdrawals or redemptions that can be made by a Planholder, each partial
withdrawal or redemption must be at least $100. Shares are withdrawn or redeemed
at their net asset value next determined after a request in proper form
(including signature guarantees and other documentation, if applicable) is
received by the Custodian. Requests received in proper form prior to the close
of the New York Stock Exchange (the "Exchange") on any business day of the Fund
will be confirmed at the price determined as of the close of that day. No
partial withdrawal or redemption shall affect the total number of monthly Plan
investments to be made or the unpaid balance of monthly Plan investments. As
discussed under "Taxes," there may be federal income tax consequences upon a
partial redemption of Fund shares.
WRITTEN REQUESTS. Written requests must be signed by all registered
Planholders and should be sent to the Custodian. Redemption proceeds will be
mailed to the address of record unless instructions to the contrary are received
with the Planholders' signatures guaranteed. In the case of a cash withdrawal (a
redemption), the Custodian or Sponsor may require additional documentation.
If a cash withdrawal is: (a) more than $100,000, (b) made payable to an
individual other than the Planholder of record, or (c) to be sent to an address
other than the address of record, a letter of instruction will be required,
signed by all Planholders with signatures guaranteed in a form acceptable to the
Custodian. A Planholder should be able to obtain an acceptable signature
guarantee from a bank, broker, dealer, credit union (if authorized under state
law), securities exchange or association, clearing agency or savings
association. Signature guarantees are not accepted by facsimile. A notarized
signature will not be sufficient for the request to be in proper order. A
signature guarantee is not required for cash withdrawals of $100,000 or less, if
requested by and payable to all Planholders of record, and to be sent to the
address of record for that Plan account. However, the Sponsor reserves the right
to require signature guarantees on all redemptions. A signature guarantee is
required in connection with most requests for transfer of Plan ownership. Also,
a signature guarantee is required if the Sponsor or the Custodian, in the sole
discretion of either, believes that a signature guarantee is warranted. All
documents must be in proper order before any withdrawals or redemptions can be
executed.
TELEPHONE REQUESTS. Telephone withdrawals and redemptions by
Planholders will automatically be authorized for each Plan (except Plans
established as retirement accounts) unless the Planholder indicates otherwise on
his or her Plan Application. For personal assistance, call the Custodian at
1-800-765-9565 between 8 a.m. and 6 p.m. Eastern time on weekdays. YOU ARE
STRONGLY URGED TO CONSULT WITH YOUR FINANCIAL REPRESENTATIVE PRIOR TO REQUESTING
ANY TELEPHONE TRANSACTION, AS THERE MAY BE TAX CONSEQUENCES AND/OR PENALTIES.
A cash withdrawal can be made as a telephone transaction only if: (1)
the proceeds are made payable to the Planholder(s) of record and mailed to the
address of record; (2) there has been no change in the address of record on the
Plan within the preceding 30 days; (3) the person requesting the withdrawal can
provide proper identification information; and (4) the proceeds do not exceed
$100,000. The cancellation and refund rights set forth on page 8 of this
Prospectus may not be exercised by telephone. No telephone transaction request
will be accepted which specifies a particular transaction date or any other
special conditions.
The Sponsor has made arrangements with certain dealers to accept
telephone transaction instructions from the dealer on behalf of Plans for which
the dealer is the firm of record. The Sponsor reserves the right to impose
conditions on these dealers, including the condition that they enter into
agreements (which contain additional conditions with respect to effecting
telephone transactions) with the Sponsor. Any resulting loss from the dealer's
failure to submit a telephone transaction within the prescribed time frame will
be borne by that dealer.
To confirm that each transaction instruction received by telephone is
genuine, the Custodian will record each telephone transaction, require the
caller to provide proper personal identification information and send the
Planholder a written confirmation of each telephone transaction. If reasonable
procedures, such as those described above, are followed, neither Pioneer
Independence Plans, the Fund, the Custodian nor the Sponsor will be responsible
for the authenticity of instructions received by telephone; therefore, the
7
<PAGE>
Planholder bears the risk of loss for unauthorized or fraudulent telephone
transactions. The Custodian or Sponsor may implement other procedures from time
to time. 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
Custodian by telephone to institute a transaction. At such times, a Planholder
should communicate with the Custodian in writing.
VOLUNTARY TAX WITHHOLDING. A Planholder may request (in writing) that the
Custodian withhold 28% of the dividends and capital gains distributions paid on
any Fund shares held in his or her Plan account (before any reinvestment) and
forward the amount withheld to the IRS as a credit against the Planholder's
federal income taxes. This option is not available for Plan accounts registered
as retirement plan accounts or for Plan accounts subject to backup withholding.
GENERAL. Normally, a Planholder will be sent a check as a result of
redeeming Fund shares under this or any of the options described in this
Prospectus within seven days after such a request is received by the Custodian
and all documents are in proper order. However, the Custodian will not mail
redemption proceeds to a Planholder until checks or other orders for payment
received for the Fund shares purchased by the Planholder have cleared, which may
take up to 15 calendar days, from the date on which the check or other order for
payment is received by the Custodian.
Redemptions may be suspended and payments of redemption proceeds may be
postponed during any period in which any of the following conditions exist: the
Exchange is closed, other than for customary weekends and holidays; 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 Securities and Exchange Commission, by order, so
permits.
REPLACEMENTS OF PARTIAL WITHDRAWALS
After a partial cash withdrawal, the Planholder may, but is not
required to, restore the value of his or her Plan by remitting to the Custodian
an amount equal to the amount redeemed. The reinvested amount will be used to
purchase Fund shares for the Planholder's account at the next determined net
asset value for the Fund's shares. Any repayment of a partial cash withdrawal
may not be made before 90 days from the date of redemption, except in the case
of Planholder accounts that are IRAs, for which a reinvestment may be made after
a period of 45 days. Full reinstatement of a partial cash withdrawal need not be
accomplished in one transaction if the amount redeemed exceeds $500. However,
the minimum for each reinvestment is 25% of the amount withdrawn or $500,
whichever is less. Replacements of partial cash withdrawals must be clearly
identified as such to distinguish them from regular monthly Plan investments.
EXTENDED INVESTMENT OPTION
Under the extended investment option, a Planholder may continue making
monthly investments after completing all scheduled investments under a Plan. The
extended investment option must be exercised within six months after completing
all scheduled investments under a Plan.
If under this option a Planholder fails to make regularly scheduled
investments for six consecutive months, after being credited for any advance
investments made under the extended investment option, the Planholder forfeits
his or her right to make such additional investments. All extended investment
options will terminate on the date the 300th monthly investment is made under
the Plan, and no further investments will be accepted after that date.
SYSTEMATIC WITHDRAWAL PROGRAM
A Planholder may elect a systematic withdrawal program upon completion
of all regularly scheduled investments. A Planholder may also elect a systematic
withdrawal program from an incomplete Plan if the withdrawal is to be taken from
a Plan that is part of an IRA and the Planholder has reached age 59 1/2.
Under a systematic withdrawal program, the Custodian, as the
Planholder's agent, will redeem sufficient Fund shares from the Plan at the net
asset value at the time of such redemption to provide regular withdrawal
payments of $50 or more on a monthly or quarterly basis, as elected by the
Planholder. Except for the $50 minimum, there is no limitation on the size of
withdrawals. All systematic withdrawal program transactions will be made as of
the end of the day specified by the Planholder for the withdrawal (or, if such a
day is not a business day, the first business day after that date).
A Planholder has the right to change the dollar amount of withdrawals
paid to him or her under the systematic withdrawal program or to discontinue a
systematic withdrawal program at any time. There are no charges imposed for any
regular withdrawals under a systematic withdrawal program.
The Plan will remain in full force and effect with all rights and
privileges until all Fund shares have been withdrawn from the Planholder's
account. While the systematic withdrawal program is in effect, a Planholder must
elect to reinvest all dividends and distributions in Fund shares to be held in
his or her Plan account. A Planholder should realize that withdrawals in excess
of dividends and distributions will be made from principal and may eventually
exhaust the Planholder's account. Also, a gain or loss for tax purposes may be
realized by the Planholder on each withdrawal payment.
The Sponsor reserves the right to discontinue offering the systematic
withdrawal program at any time after 90 days' notification to all Planholders.
CANCELLATION AND REFUND RIGHTS
A Planholder has certain rights of cancellation.
Within 60 days after the first investment under a Plan (which, for this
purpose, is the date appearing on the confirmation statement following the
initial investment), the Custodian will send a notice to the Planholder
regarding the Planholder's cancellation rights. A Planholder may elect to cancel
his or her Plan within 45 days of the mailing date of that notice by submitting
a written request for cancellation to the Custodian, signed by the Planholder.
In addition, a cancellation request involving a Plan with current net assets
valued at more than $100,000 must be signature guaranteed, as described under
"Partial Withdrawal or Redemption Without Termination of the Plan." The
Planholder will receive a payment equal to the sum of (1) the total current net
asset value of the Fund shares credited to the Planholder's account as of the
end of the business day that the cancellation request is received by the
Custodian and (2) a refund of all Creation and Sales Charges paid under the
Plan.
In addition, at any time within an 18-month period after the purchase
of a Plan, the Planholder may surrender his or her Plan. To surrender a Plan,
the Planholder should send to the
8
<PAGE>
Custodian a written request signed by the Planholder. In addition, a
surrender request involving a Plan with current net assets valued at more than
$100,000 must be signature guaranteed, as described under "Partial Withdrawal or
Redemption Without Termination of the Plan." Upon surrender, the Planholder will
receive from the Custodian a payment equal to the sum of (a) the total current
net asset value of the Fund shares credited to the Planholder's account as of
the end of the business day of the surrender and (b) a refund equal to the
amount of all Creation and Sales Charges paid to the date of surrender minus 15%
of the gross amount the Planholder has paid as of that date. Service charges and
other fees will not be refunded.
If a Planholder surrenders his or her Plan under this cancellation and
refund privilege, the Planholder may not reinstate his or her Plan at net asset
value until all Creation and Sales Charges included in the redemption amount are
first deducted from the reinstatement amount. This requirement is more fully
explained below in "Replacement Privilege on Termination." Exercise of
cancellation rights may be a taxable event for the Planholder. Planholders
should consult their tax advisers.
The Custodian will send the Planholder a written notice of the 18-month
right of cancellation if either of the following occurs:
(1) If, during the first 15 months after the date of issuance of the
Plan, the Planholder has missed three or more investments; or
(2) Following the first 15 months after the date of issuance of
the Plan, but prior to the expiration of 18 months after such date, the
Planholder has missed one or more investments. (If the Custodian has already
sent a notice at 15 months, a second notice will not be required even if
additional investments are missed.)
These notices will inform the Planholder of his or her rights of
cancellation as set forth above and will also include the value of the
Planholder's account at the time the notice is sent.
TERMINATION OF A PLAN BY THE PLANHOLDER AND WITHDRAWAL OF SHARES
A Planholder may terminate a Plan at any time by sending a written
request to the Custodian.
In terminating a Plan, the Planholder may, by written request signed by
the Planholder, instruct the Custodian to: (a) redeem the Fund shares held in
the Planholder's account or (b) deliver a confirmation statement for the Fund
shares held under the Plan to the Planholder.
If the Planholder directs the redemption of Fund shares, the Custodian will
withdraw the Fund shares from the Plan account, redeem the Fund shares and send
the proceeds directly to the Planholder. If the amount of the redemption is more
than $100,000, is made payable to an individual other than the Planholder of
record, or is to be sent to an address other than the address of record, the
Planholder's request must be signature guaranteed as described under "Partial
Withdrawal or Redemption Without Termination of the Plan." All documents must be
in good order before a redemption can be executed. The redemption price will be
the net asset value of the Fund shares next determined after such documents have
been received in proper order by the Custodian. The redemption of Fund shares
may be a taxable event for the Planholder.
If the Planholder directs the delivery of the Fund shares held under
the Plan, sufficient shares of the Fund will be redeemed by the Custodian to pay
any authorized deductions and/or transfer taxes and the remaining Fund shares
will be registered in the name of the Planholder. A Planholder who chooses to
receive Fund shares, may exchange his or her Fund shares for shares of certain
other Pioneer mutual funds for which Pioneering Management Corporation or an
affiliate is the investment manager. The exchange privilege is more fully
described in the Fund's Prospectus under the caption "Shareholder Services."
Planholders will not be permitted to exchange such shares back into the Fund or
to make additional direct investments in the Fund.
REPLACEMENT PRIVILEGE ON TERMINATION
For Plans that have been completely terminated, the replacement
privilege allows reinvestment of an amount equal to at least 10% of the net
asset value of the Fund shares redeemed from a Plan, without any Creation and
Sales Charge except as described below, in a reopened identically registered
Plan account. Reinvestment is made at the net asset value per Fund share next
determined following the timely receipt by the Custodian of a replacement order
and payment. The replacement privilege must be exercised within 90 days
following the date of termination of the Plan. For the federal income tax
effects of replacement and reinvestment, see "Taxes."
The replacement privilege is available to Planholders who have not
previously exercised this privilege. The replacement privilege does not abrogate
the partial withdrawal or redemption without termination privilege described on
page 7. If a Planholder has redeemed Fund shares from a Plan under the
procedures described under "Cancellation and Refund Rights" on page 8, the
Planholder will not be permitted to replace at net asset value the proceeds from
such a cancellation or refund until all refunded Creation and Sales Charges have
been deducted from the amount offered for the replacement.
The Sponsor may in its sole discretion offer additional replacement
options from time to time.
DIVIDENDS AND DISTRIBUTIONS
All Fund dividends and distributions, after any applicable deductions,
are reinvested automatically in additional shares of the Fund as of the payment
date, at the net asset value determined on the ex-dividend date of the dividend
or distribution, unless the Planholder elects to receive the dividends or
distributions by check. See "Service Charges and Other Fees." No Creation and
Sales Charge is made on any such reinvestments. If the Planholder wishes to
receive the dividends and other distributions in cash - rather than in
additional shares of the Fund - the Planholder must so instruct the Custodian in
writing. Such instructions must be received at least seven days prior to
the record date of a dividend or distribution. A Planholder may change these
instructions at any time.
9
<PAGE>
Dividends and other distributions by the Fund are made on a per-share
basis. After every distribution, the value of a Fund share drops by the amount
of the distribution. If a Plan investment is made shortly before the ex-dividend
date of the dividend or distribution, the Planholder will pay the full price for
the shares including the amount that is soon to be paid as a dividend.
VOTING RIGHTS IN FUND SHARES
Pioneer Independence Plans, as a shareholder of the Fund, has certain
voting rights in Fund shares which are held on behalf of the Plans. Each
Planholder is permitted to exercise voting rights attributable to the Fund
shares held in the Planholder's account. The Custodian will vote the Fund shares
held in a Planholder's account in accordance with that Planholder's
instructions. In the absence of such instructions, the Custodian will vote a
Planholder's shares in the same proportion as it votes the shares for which it
has received instructions from other Planholders.
Planholders may attend any shareholder meetings of the Fund, and if a
Planholder wishes to vote in person the Fund shares held in his or her Plan
account, the Planholder may submit a written request to the Custodian prior to
the meeting for a proxy which will permit the Fund shares to be voted in person
by the Planholder.
TRANSFER OR ASSIGNMENT OF RIGHTS IN A PLAN
If a Planholder desires to secure a loan, the Planholder (other than a
tax-qualified retirement plan or an IRA) may assign his or her rights to a bank
or other lending institution. The bank or other lending institution, however,
will not be entitled to exercise the right of partial withdrawal or redemption.
During the term of the assignment, the Planholder will be entitled to all
dividends and distributions on Fund shares.
A Planholder may also transfer his or her rights to another person: for
example, a relative, charitable institution or trust. This may be accomplished
in several ways:
(1) A Planholder may transfer his or her right, title and interest
to another person whose only right shall be the privilege of complete and prompt
withdrawal from the Plan; or
(2) A Planholder may transfer his or her entire right, title and
interest to another person, trustee or custodian acceptable to the Sponsor, who
has made application to the Sponsor for a similar Plan.
The Custodian will provide Planholders with the appropriate assignment
forms upon request. Transfers may be subject to income and other taxes and may
be restricted for those Plans held in connection with IRAs or qualified
retirement plans.
STATEMENTS, REPORTS AND NOTICES
For the first 18 months after the issuance of a Plan, the Custodian
will mail to each Planholder a confirmation statement for each financial
transaction as it occurs. Beginning after the 19th month, the Custodian may mail
statements to Planholders quarterly. Each transaction confirmation statement,
quarterly statement or other statement, as required, will state the price per
share of the Fund shares purchased after applicable deductions and the total
number of Fund shares held in the Planholder's account. Any notices, reports or
documents required or authorized to be given or sent to a Planholder under this
Prospectus will be conclusively deemed to have been given or sent upon mailing
to the Planholder's address of record, and the date of such mailing shall be
deemed the date of the giving of such notice.
X. TERMINATION OF A PLAN BY THE SPONSOR OR CUSTODIAN
Although a Plan calls for regular monthly investments over a 15-year
period or for an extended 25-year period, neither the Sponsor nor the Custodian
can elect to terminate a Plan until 300 investments have been made unless the
Planholder has not made investments under his or her Plan for more than 12
consecutive months or unless Fund shares are not obtainable and a substitution
is not made. The period of default will not start until a Planholder has been
given full credit for a period equal to the number of any advance monthly Plan
investments made.
After 300 investments, or if other events justify termination, the
Sponsor or the Custodian has the right to terminate a Plan 60 days after mailing
a written notice to the Planholder. Such notice will request that the Planholder
elect to have the Plan distributed either in cash or in Fund shares after
deduction of all authorized charges, fees and expenses. On termination, the
Custodian (as the Planholder's agent) may surrender for liquidation all of the
Fund shares credited to a Planholder's account, or sufficient Fund shares to pay
all authorized deductions. The balance of Fund shares and/or cash, after payment
of all authorized deductions, will be held by the Custodian for delivery to a
Planholder against the surrender of a Plan.
No interest will be paid by the Custodian on any cash balances. If the
Plan is not surrendered within 60 days after the notice of termination, the
Custodian, at its discretion, may at any time thereafter fully discharge its
obligations by mailing a confirmation statement for the Fund shares or a check,
drawn in accordance with the terms of the Plan, to the address of record noted
in the Plan account. The Planholder will then have no further rights under his
or her Plan except that if the confirmation statement or check is returned to
the Custodian undelivered, the Custodian will continue to hold these assets for
the benefit of the Planholder, subject only to the escheatment laws.
XI. SERVICE CHARGES AND OTHER FEES
Except as described below, there are currently no deductions against
Planholders' accounts or against Fund dividends and/or distributions to
compensate the Sponsor or the Custodian for its services.
If a Plan is not current and no Plan investments have been made for a
12-month period, the Custodian will deduct for its services a fee of $12 per
year. A charge of $5.00 will be deducted for each monthly Plan investment
received by check or other order for the payment of money which is not honored
10
<PAGE>
by the bank on which it is drawn. A charge of $2.50 will be made for terminating
a Plan on which investments have not been completed.
Plans established as IRAs are subject to an annual IRA custodial fee of
$10, a portion of which is paid to The Pioneer Group, Inc., as IRA custodian.
This annual fee will be deducted from the Plan account unless a separate check
is received in payment of the IRA custodial fee.
The Fund and the Sponsor reserve the right to impose a processing fee of
$1.50 for each monthly Plan investment received by check (up to a maximum of $5
per event). No charge will be imposed on the initial investment to establish a
Plan. There is no processing fee on monthly Plan investments made through an
automatic investment option. The check processing fee is not currently in
effect.
All other Custodian fees which would otherwise be charged to the Plan or
the Planholders, or deducted from Fund dividends and/or distributions, may be
paid by the Fund. Although there is no current intention to do so, the Fund
reserves the right to cease paying such fees, and the Sponsor reserves the right
to cause deductions in the future against the Plans, the Planholders, and Fund
dividends and/or distributions to compensate the Custodian for its services.
XII. TAXES
Under the Code, each Planholder is deemed, for federal income tax
purposes, to own directly the Fund shares accumulated in his or her Plan
account. Designated long-term capital gain distributions, which are
automatically reinvested in additional Fund shares, are treated as long-term
capital gains. The tax cost of the Fund shares acquired is the amount paid for
those shares, including the Creation and Sales Charge.
As more fully described under "Dividends Distributions and Taxation" in the
Prospectus of the Fund, dividends and distributions paid by the Fund are
reportable for federal income tax purposes by Planholders who are otherwise
subject to federal income tax. Dividends and distributions are reportable by
Planholders regardless of whether the amounts are invested in additional shares
of the Fund or are received in cash.
Gains realized on cash withdrawals (redemptions) generally also will be
subject to taxes, and the ability to deduct losses from such redemptions may be
limited. There may also be limitations on the amount of loss a Planholder may
recognize in the event of cancellation and refund or a replacement and
reinvestment. In general, the Code restricts loss recognition when securities
are sold and reacquired in a short period of time; these restrictions may in
certain circumstances apply to Planholders.
An appropriate notice regarding taxes will be sent to Planholders each year
by the Custodian. Any taxes payable with respect to any of the profits realized
on sales or transfers by the Custodian or the Sponsor of Fund shares or other
property credited to a Planholder's account in accordance with the provisions of
a Plan and any taxes levied or assessed with respect to Fund shares or the
income therefrom shall be borne by Planholders individually and not by the
Custodian or the Sponsor.
The foregoing is a brief summary of certain U.S. federal income tax
consequences to Planholders of investing in the Fund through Pioneer
Independence Plans. Planholders should consult the Fund Prospectus and Statement
of Additional Information and their tax advisers for additional information.
XIII. THE FUND
The objective and investment policies of Pioneer Independence Fund are
described in the attached Prospectus of the Fund. Shares of the Fund are
credited to a Plan, after applicable deductions are made, at the net asset value
as of the end of the business day on which the Custodian receives the Plan's
investments.
Dividends and distributions paid on Fund shares will be reinvested by
the Custodian in additional Fund shares for the Plans at the then current net
asset value, unless a Planholder elects to receive them in cash.
The Fund incurs certain advisory fees and other expenses. These fees and
expenses may vary. The Fund is governed by its Board of Trustees, and Pioneer
Independence Plans does not fix or specify the level of expenses of the Fund.
The Fund's fees and expenses, including the Fund's payment of Plan custody
charges, are described in detail in the Fund's Prospectus and Statement of
Additional Information.
The Fund has adopted a Plan of Distribution for shares of the Fund in
accordance with Rule 12b-1 under the Investment Company Act of 1940, as amended
(the "1940 Act"), pursuant to which certain distribution and service fees are
paid.
XIV. SUBSTITUTION OF THE UNDERLYING INVESTMENT
The Sponsor may substitute the shares of another investment medium as
the underlying investment for the shares of the Fund if it deems such action to
be in the best interests of Planholders. Such substituted shares generally shall
be comparable in character and quality to the present Fund shares, and shall be
registered with the Securities and Exchange Commission under the Securities Act
of 1933, as amended. Before any substitution can be effected, the Sponsor must:
1. To the extent required, obtain an order from the Securities and
Exchange Commission approving such substitution under the
provisions of Section 26(b) of the 1940 Act;
2. Submit written notice of the proposed substitution to the
Custodian;
3. Submit written notice of the proposed substitution to each
Planholder, giving a reasonable description of the substituted
fund shares, disclosing that unless the Plan is surrendered
within 30 days of the date of mailing such notice, the Planholder
will be considered to have consented to the substitution and to
have agreed to bear his or her pro rata share of expenses and
taxes in connection with the substitution; and
4. Provide the Custodian with a signed certificate stating that the
required notice has been given to Planholders.
If a Plan is not surrendered within 30 days from the date of such
notice, the Custodian shall purchase the shares of the substituted fund for the
Plan with the proceeds of any Plan investments received from the Planholder and
any dividends
11
<PAGE>
or distributions which may be reinvested for the Plan. If shares of the
substituted fund are also to be substituted for the Fund shares already held,
the Sponsor must arrange for the Custodian to be furnished, without payment of a
sales charge or fees of any kind, with shares of the substituted fund having an
aggregate value equal to the value of the Fund shares for which they are to be
exchanged. A substitution may be a taxable event for Planholders.
If the Fund shares are not available for purchase for a period of 120
days or longer, and the Sponsor fails to substitute other shares, the Custodian
may, but is not required to, select a substitute underlying investment or
terminate Pioneer Independence Plans. If the Custodian selects a substitute
investment, it shall, to the extent required, first obtain an order from the
Securities and Exchange Commission approving such substitution as specified
above and then shall notify the Planholder, and if, within 30 days after mailing
such notice, the Planholder gives written approval of the substitution and
agrees to bear his or her pro rata share of actual expenses, including tax
liability sustained by the Custodian, the Custodian may thereafter purchase such
substituted shares. The Planholder's failure to give such written approval
within the 30-day period shall give the Sponsor the authority to terminate the
Plan.
If shares of the Fund are not available for purchase for a period of
120 days or longer, and neither the Sponsor nor the Custodian substitutes other
shares, the Custodian shall have authority, without further action on its part,
to terminate the Plans.
The underlying investment could change under certain other
circumstances. For instance, the Fund could be reorganized with, or acquired by
or merge with another entity, which would result in a Plan investing in the
successor to any such transaction.
XV. RETIREMENT PLANS
A Plan may be purchased by tax-sheltered retirement plans, including IRAs
and qualified pension and profit sharing plans. The Pioneer Individual
Retirement Plan (the "Pioneer IRA") is offered by the Sponsor. Pioneer IRAs may
be established through contributions to a Plan or through a lump sum investment
in a Plan from the proceeds of a rollover of prior year qualified assets or a
direct transfer of qualified assets from other fiduciary agencies. Such
rollovers or transfers may contain either or both employer sponsored retirement
assets and owner contributions.
Detailed information concerning the Pioneer IRA is available from the
Sponsor. This information should be read carefully, and prospective investors
should consult with an attorney or tax adviser regarding the establishment of an
IRA in connection with a Plan. The information sets forth the additional service
fees charged for IRAs and describes the federal income tax consequences of
establishing an IRA. Under the Pioneer IRA, dividends and distributions will be
reinvested automatically in additional Fund shares for the Plan. As described in
"Service Charges and Other Fees," a maintenance fee is charged on Pioneer IRAs.
Premature termination of a Plan can have adverse financial consequences
and therefore prospective investors should consider carefully whether the IRA or
other qualified retirement plan will have the financial resources to honor a
15-year commitment to making monthly Plan investments.
XVI. THE SPONSOR
Pioneer Funds Distributor, Inc., 60 State Street, Boston, Massachusetts
02109-1820, is a Massachusetts corporation organized on March 2, 1989. It is a
broker-dealer registered under the Securities Exchange Act of 1934 and a member
of the National Association of Securities Dealers, Inc. (the "NASD"). The
Sponsor is an indirect wholly owned subsidiary of The Pioneer Group, Inc.
In order to establish the Plans, the Sponsor invested a lump sum in a Plan on
which the Creation and Sales Charges were waived and which is exempt from the
terms of the Plans. The Sponsor's directors and executive officers are listed
below.
NAME, POSITIONS AND OFFICES
JOHN F. COGAN, JR., CHAIRMAN AND DIRECTOR
President, Chief Executive Officer and a Director of The Pioneer Group,
Inc. ("PGI"); Chairman and a Director of Pioneering Management Corporation
("PMC"); Director of Pioneering Services Corporation ("PSC"), Pioneer Capital
Corporation ("PCC"), Pioneer Real Estate Advisors, Inc., Pioneer Forest, Inc.,
Pioneer Explorer, Inc., Pioneer Management (Ireland) Ltd. ("PMIL") 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. ("First Russia") and Pioneer Omega, Inc. ("Omega"); Chairman
of the Board and Director of Pioneer Goldfields Limited ("PGL") and Teberebie
Goldfields Limited; Chairman of the Supervisory Board of Pioneer Fonds
Marketing, GmbH ("Pioneer GmbH"), Pioneer First Polish Trust Fund Joint Stock
Company, S.A. ("PFPT") and Pioneer Czech Investment Company, A.S. ("Pioneer
Czech"); Chairman, President and Trustee of all of the Pioneer mutual funds;
Director of Pioneer Global Equity Fund Plc, Pioneer Global Bond Fund Plc,
Pioneer DM Cashfonds Plc, Pioneer European Equity Fund Plc, Pioneer Central &
Eastern Europe Fund Plc, and Pioneer US Real Estate Fund Plc; and Partner, Hale
and Dorr LLP (counsel to PGI and the Fund).
ROBERT L. BUTLER, DIRECTOR AND PRESIDENT
Executive Vice President and a Director of PGI; Director of PMC, PMIL, PSC,
PIntl, Pioneer Czech, Pioneer Global Equity Fund Plc, Pioneer Global Bond Fund
Plc, Pioneer DM Cashfonds Plc, Pioneer European Equity Fund Plc, Pioneer Central
& Eastern Europe Fund Plc, and Pioneer US Real Estate Fund Plc; Vice Chairman of
Pioneer GmbH; and a Member of the Supervisory Board of PFPT.
DAVID D. TRIPPLE, DIRECTOR
Executive Vice President and a Director of PGI; President, Chief Investment
Officer and a Director of PMC; Director of PCC, PIntl, First Russia, Omega and
Pioneer SBIC Corporation ("Pioneer SBIC"), Pioneer Global Equity Fund Plc,
Pioneer Global Bond Fund Plc, Pioneer DM Cashfonds Plc, Pioneer European Equity
Fund Plc, Pioneer Central & Eastern Europe Fund Plc, and Pioneer US Real Estate
Fund Plc; and Executive Vice President and Trustee of all of the Pioneer mutual
funds.
WILLIAM H. KEOUGH, TREASURER
Senior Vice President, Chief Financial Officer and Treasurer of PGI;
Treasurer of PMC, PSC, PCC, PIntl, PMT, PGL, First
12
<PAGE>
Russia, Omega and Pioneer SBIC; and Treasurer of all of the Pioneer mutual
funds.
JOSEPH P. BARRI, CLERK
Corporate Secretary of PGI and most of its subsidiaries; Secretary of all
of the Pioneer mutual funds; and Partner, Hale and Dorr LLP.
SENIOR VICE PRESIDENTS: Steven M. Graziano and Stephen W. Long.
VICE PRESIDENTS: Mary Kleeman, Barry G. Knight, William A. Misata, Anne W.
Patenaude, Gail A. Smyth, Constance D. Spiros and Marcy L. Supovitz.
Commissions ranging from 80% to 95% of the total Creation and Sales
Charges will be paid to authorized investment broker-dealer firms that are
members of the NASD and have executed a sales agreement with the Sponsor.
The Sponsor may terminate its obligations under the Plans under certain
circumstances including, but not limited to, circumstances where: the underlying
fund ceases operations or is subject to a merger or acquisition; or the
shareholders of the underlying fund have approved the cessation of operations or
merger or acquisition; or the obligations of the Sponsor as described in this
Prospectus and the Custodian Agreement will be assumed by another entity that
the Sponsor believes at the time of assignment is capable of fulfilling its
obligations as described in this Prospectus and under terms of the Custodian
Agreement.
XVII. THE CUSTODIAN
State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02110, acts as Custodian for Pioneer Independence Plans pursuant
to a custodian agreement with the Sponsor, dated February 17, 1998 (the
"Custodian Agreement"). The Custodian is a trust company organized under the
laws of Massachusetts.
Investments under a Plan should be payable to Pioneer Independence
Plans and sent to the Custodian. After making authorized deductions, the
Custodian applies the remaining balance of the investment to the purchase of
Fund shares for a Plan. The Custodian holds these shares in its custody,
receiving dividends and distributions which are automatically reinvested in
additional Fund shares for the Plan accounts, unless a Planholder elects to
receive such dividends and distributions by check.
The duties of the Custodian under the Custodian Agreement include the
receipt of all investments from Planholders and income dividends and capital
gains distributions on Fund shares, the processing of all authorized deductions
therefrom and the purchase and retention of Fund shares for the Planholders'
accounts. The Custodian also effects partial or complete liquidations of Plans
in connection with withdrawals or terminations and the various other functions
discussed above.
The Custodian has assumed only those obligations specifically imposed
on it under the Custodian Agreement. The Custodian has no responsibility for the
choice of the underlying investment, for the investment policies and practices
of the Fund or for the acts or omissions of the Sponsor or the investment
manager of the Fund.
The Custodian Agreement cannot be amended to affect adversely the
rights and privileges of the Planholders without their written consent. Neither
may the Custodian resign unless an eligible successor has been designated and
has accepted the custodianship. Such successor must be a bank or trust company
having capital, surplus and undivided profits totaling at least $2,000,000. The
Custodian may be changed without notice to, or the approval of, the Planholders.
The Custodian may terminate its obligation to accept new Plans for custodianship
if the Sponsor fails to perform certain activities it is required to perform
under the Custodian Agreement or if the Custodian terminates the Custodian
Agreement upon 90 days' notice to the Sponsor.
XVIII. PIONEER INDEPENDENCE PLANS
Pioneer Independence Plans is considered to be a unit investment trust
under the 1940 Act and is registered as such with the Securities and Exchange
Commission. Such registration does not imply supervision of management or
investment practices or policies by the Commission.
Pioneer Independence Plans is currently registered in all states. The
Plans may be offered in all states where it is lawful to do so.
13
<PAGE>
XIX. FINANCIAL STATEMENTS
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
TO THE BOARD OF DIRECTORS OF PIONEER FUNDS DISTRIBUTOR, INC.
(SPONSOR) AND PLANHOLDERS OF PIONEER INDEPENDENCE PLANS:
We have audited the accompanying Balance Sheet of Pioneer Independence
Plans as of February 20, 1998. This financial statement is the responsibility of
the Plans' Sponsor. Our responsibility is to express an opinion on this
financial statement based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the balance sheet referred to above presents fairly, in all
material respects, the financial position of Pioneer Independence Plans as of
February 20, 1998, in conformity with generally accepted accounting principles.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Boston, Massachusetts
February 24, 1998
14
<PAGE>
PIONEER INDEPENDENCE PLANS
FOR THE ACCUMULATION OF SHARES OF
PIONEER INDEPENDENCE FUND
BALANCE SHEET
February 20, 1998
ASSETS:
Investment in Pioneer Independence Fund,
at value (cost $100,000) $100,000
-------
Total assets $100,000
LIABILITIES: $ -
-------
NET ASSETS:
Total net assets (equivalent to $10.00 per share
based on 10,000 shares of beneficial interest owned
on outstanding plan) $100,000
=======
The accompanying notes are an integral part of this balance sheet.
NOTES TO BALANCE SHEET
1. ORGANIZATION
Pioneer Independence Plans (the Plans) was registered with the Securities
and Exchange Commission under the Investment Company Act of 1940 (the 1940 Act)
as a unit investment trust on December 12, 1997. The initial investment into the
Plans was made on February 18, 1998 by Pioneer Funds Distributor, Inc., the
sponsor for the Plans. This initial investment is exempt from creation and sales
charges as well as certain other terms of the Plans. Prior to February 18, 1998,
the Plans' activities have been limited to organizational matters with no
operating activities.
The following is a summary of significant accounting policies consistently
followed by the Plans, which are in conformity with those generally accepted for
unit investment trusts:
A. SECURITY VALUATION. Investments are valued at the net asset value of fund
shares held.
B. TRANSACTION DATES. Share transactions are recorded on a trade date basis.
15
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
TO THE BOARD OF DIRECTORS OF
PIONEER FUNDS DISTRIBUTOR, INC.:
We have audited the accompanying consolidated statement of financial
condition of Pioneer Funds Distributor, Inc. (a Massachusetts corporation and
wholly owned subsidiary of Pioneering Management Corporation) as of December 31,
1997, and the related consolidated statements of operations, changes in
stockholder's equity and cash flows for the year then ended. These consolidated
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Pioneer Funds
Distributor, Inc. as of December 31, 1997, and the results of its operations and
its cash flows for the year then ended, in conformity with generally accepted
accounting principles.
Our audit was conducted for the purpose of forming an opinion on the basic
consolidated financial statements taken as a whole. The information contained in
Schedules I and II is presented for the purpose of additional analysis and is
not a required part of the consolidated financial statements, but is
supplementary information required by Rule 17a-5 under the Securities Exchange
Act of 1934. Such information has been subjected to the auditing procedures
applied in the audit of the basic consolidated financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
consolidated financial statements taken as a whole.
/s/ Arthur Andersen LLP
Boston, Massachusetts
February 3, 1998
16
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
DECEMBER 31, 1997
(DOLLARS IN THOUSANDS)
ASSETS
CASH AND TEMPORARY INVESTMENTS, AT COST,
WHICH APPROXIMATES VALUE (Note 2) $ 4,418
INVESTMENTS IN MARKETABLE SECURITIES, AT VALUE (Note 2) 6,445
RECEIVABLES:
From securities brokers and dealers for sales of
mutual fund shares 11,752
Other 3,817
PREPAID SERVICE FEES 1,862
OTHER ASSETS 1,295
FURNITURE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, AT
COST (NET OF ACCUMULATED DEPRECIATION OF $651) (Note 2) 492
DEALER ADVANCES (NET OF ACCUMULATED AMORTIZATION
OF $18,442) (Note 9) 42,302
DEFERRED COST OF RESTRICTED STOCK PLAN (Note 5) 621
--------
Total assets $ 73,004
========
LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES:
Payable to funds for shares sold $ 11,731
Accrued expenses and accounts payable 5,045
Distribution fees due to brokers and dealers 1,074
Deferred income taxes, net (Note 4) 16,201
Due to affiliates, net 426
--------
Total liabilities 34,477
--------
COMMITMENTS AND CONTINGENCIES (Note 8)
STOCKHOLDER'S EQUITY:
Common stock, $0.10 par value-
Authorized--100,000 shares
Issued and outstanding--100 shares -
Paid-in capital 115,925
Accumulated deficit (77,224)
Cumulative translation adjustment (174)
--------
Total stockholder's equity 38,527
--------
Total liabilities and stockholder's equity $ 73,004
========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
CONSOLIDATED FINANCIAL STATEMENTS.
17
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
(DOLLARS IN THOUSANDS)
REVENUES AND OTHER INCOME (Note 2):
Distribution fees $ 13,863
Commissions-
Mutual funds 7,177
Variable annuities 1,939
Other income 2,098
--------
25,077
--------
DISTRIBUTION AND ADMINISTRATIVE EXPENSES:
Sales and marketing 17,454
Salaries and related benefits 8,795
Amortization of dealer advances 9,514
Other 10,016
--------
45,779
--------
Loss before benefit for income taxes (20,702)
--------
BENEFIT (PROVISION) FOR INCOME TAXES (Note 4):
State 1,930
Federal 6,781
Foreign (150)
--------
8,561
--------
Net loss $(12,141)
========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE
CONSOLIDATED FINANCIAL STATEMENTS.
18
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
FOR THE YEAR ENDED DECEMBER 31, 1997
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
COMMON STOCK CUMULATIVE TOTAL
NUMBER PAID-IN ACCUMULATED TRANSITION STOCKHOLDER'S
OF SHARES AMOUNT CAPITAL DEFICIT ADJUSTMENT EQUITY
<S> <C> <C> <C> <C> <C> <C>
DECEMBER 31, 1996 100 $ - $ 97,200 $ (65,083) $ - $32,117
Net loss - - - (12,141) - (12,141)
Cumulative transla-
tion adjustment - - - - (174) (174)
Capital contribu-
tions (Note 7) - - 18,725 - - 18,725
-------- -------- ------- ---------- -------- -------
DECEMBER 31, 1997 100 $ - $115,925 $ (77,224) $ (174) $38,527
======== ====== ======== ========== ========= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN
INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL STATEMENTS.
19
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 1997
(DOLLARS IN THOUSANDS)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(12,141)
Adjustments to reconcile net loss to net cash
used in operating activities-
Depreciation and amortization 9,840
Unrealized gains on marketable securities, net (456)
Restricted stock plan expense 242
Changes in operating assets and liabilities-
Receivable from securities brokers and dealers
for sale of mutual fund shares (2,742)
Other receivables (1,145)
Prepaid service fees (827)
Other assets 500
Dealer advances (17,228)
Payable to funds for shares sold 2,735
Accrued expenses and accounts payable 698
Distribution fees due to brokers and dealers 703
Accrued foreign income taxes 63
Deferred cost of restricted stock plan (362)
Deferred income taxes, net 2,334
--------
Total adjustments (5,645)
--------
Net cash used in operating activities (17,786)
--------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to furniture, equipment and leasehold
improvements (226)
Investments in marketable securities (1,031)
--------
Net cash used in investing activities (1,257)
--------
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contribution 18,725
Due to affiliates, net 693
--------
Net cash provided by financing activities 19,418
--------
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS (174)
--------
NET INCREASE IN CASH AND TEMPORARY INVESTMENTS 201
CASH AND TEMPORARY INVESTMENTS, BEGINNING OF YEAR 4,217
--------
CASH AND TEMPORARY INVESTMENTS, END OF YEAR $ 4,418
========
SUPPLEMENTAL SCHEDULE OF NONCASH FINANCING ACTIVITIES:
Conversion of amount due to parent company to
additional paid in capital $ 18,725
========
THE ACCOMPANYING NOTES ARE AN
INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL STATEMENTS.
20
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1997
(1) NATURE OF OPERATIONS AND ORGANIZATION
NATURE OF OPERATIONS
Pioneer Funds Distributor, Inc. (the Company) serves as the principal
underwriter of shares of the Pioneer Family of Mutual Funds, utilizing a
large network of independent broker-dealers. In addition, the Company
serves as the exclusive distributor of the Pioneer Variable Contracts
Trust.
ORGANIZATION
The Company is a wholly owned subsidiary of Pioneering Management
Corporation (PMC). Pioneer Fonds Marketing GmbH (PFM) is a wholly owned
subsidiary of the Company and performs marketing and distributor services
in Germany.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying consolidated financial statements have been prepared in
accordance with U.S. generally accepted accounting principles.
Consolidated financial statements prepared in accordance with U.S.
generally accepted accounting principles require the use of management
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
The accompanying consolidated financial statements include the accounts
of the Company and its wholly owned subsidiary. All intercompany balances
and transactions between the Company and its subsidiary have been
eliminated in consolidation.
RECOGNITION OF REVENUE
Commissions consist of underwriting commissions earned from the
distribution of mutual fund shares and are recorded as income on the
trade (execution) date. Variable annuity commissions are earned on the
distribution of variable annuity contracts. Distribution fees are earned
based on 0.75% of certain mutual fund net assets (see Note 9). In
addition, a 0.25% basis point service fee is collected by the Company as
reimbursement for service fees prepaid to brokers and dealers in the
initial year that an account is established. In subsequent years, these
fees are collected by the Company and remitted to third-party brokers and
dealers as compensation pursuant to the underlying funds' distribution
plans. Other income primarily consists of interest and dividend income
and net realized and unrealized gains on investments in affiliated mutual
funds.
INVESTMENTS IN MARKETABLE SECURITIES
Investments in marketable securities represent investments in mutual
funds for which the Company acts as the distributor.
VALUATION OF FINANCIAL INSTRUMENTS
The Company considers the liquid nature and ready availability of market
quotations when estimating the fair value of financial instruments.
CONSOLIDATED STATEMENT OF CASH FLOWS
Cash and temporary investments consist primarily of cash on deposit in
banks and amounts invested in Pioneer Cash Reserves Fund and Pioneer DM
Cash Fonds PLC.
The Company's net benefit for state and federal income taxes of
approximately $8,711,000 in 1997 is reflected as a reduction of amounts
due to affiliates.
FURNITURE, EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Depreciation and amortization are provided for financial reporting
purposes on a straight-line basis over the following estimated useful
lives: furniture and equipment--three to five years; and leasehold
improvements--over the term of the lease, not exceeding ten years. In the
event of retirement or other disposition of fixed assets, the cost of the
assets and the related accumulated depreciation and amortization amounts
are removed from the accounts, and any resulting gains or losses are
reflected in earnings.
FOREIGN CURRENCY TRANSLATION
Net assets of the Company's operations outside of the United States are
translated into U.S. dollars using current exchange rates with the
effects of translation adjustments deferred and included as a separate
component of stockholder's equity. Revenues and expenses are translated
at the average rates of exchange during the period.
(3) NET CAPITAL
As a broker-dealer, the Company is subject to the Securities and Exchange
Commission's regulations and operating guidelines, which require the
Company to maintain a specified amount of net capital, as defined, and a
ratio of aggregate indebtedness to net capital, as defined, not exceeding
15 to 1. Net capital and the related ratio of aggregate indebtedness to
net capital may fluctuate on a daily basis. The Company's net capital, as
computed under Rule 15c3-1, was $3,565,383 at December 31, 1997, which
exceeded required net capital of $1,134,105 by $2,431,278. The ratio of
aggregate indebtedness to net capital at December 31, 1997 was 4.77 to 1.
The Company is exempt from the reserve requirements of Rule 15c3-3 since
its broker-dealer transactions are limited to the purchase, sale and
redemption of redeemable securities of registered investment companies.
The Company promptly transmits all customer funds and delivers all
securities received in connection with activities as a broker-dealer and
does not otherwise hold funds or securities for, or owe money or
securities to, customers.
(4) INCOME TAXES
The Pioneer Group, Inc. (PGI), the Parent Company of PMC,
21
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
files a consolidated federal income tax return with its direct and
indirect subsidiaries, including the Company. Consolidated income tax
benefits (provisions) are allocated among the companies based on the
income taxes that would have been benefited (accrued) had separate
returns been filed for each entity or when subsidiary losses are utilized
in consolidation.
The benefit for income taxes, as stated as a percentage of loss before
income taxes, consists of the following:
Federal statutory rate (35.0)%
(Increases) decreases in tax rate resulting from-
State income tax, new apportionment rate (4.1)
State income tax, net of federal effect (3.4)
Foreign income taxes 0.7
Other 0.4
-----
Effective tax rate (41.4)%
======
The increase in the Company's 1997 tax benefit was primarily due to the
enactment of certain changes to the method of apportioning income or loss
for purposes of calculating Massachusetts state income taxes. Statement
of Financial Accounting Standards (SFAS) No. 109, ACCOUNTING FOR INCOME
TAXES, requires restating deferred tax liabilities and assets to reflect
the lower rate. Accordingly, in 1997, the Company recorded an additional
tax benefit of approximately $840,000. Absent the required adjustment,
the effective income tax rate for 1997 would have been approximately
37.3%.
The components of deferred income taxes recognized in the accompanying
consolidated statement of financial condition are comprised of deferred
tax assets of approximately $435,000 and deferred tax liabilities of
approximately $16,636,000. The approximate income tax effect of each type
of temporary difference is as follows:
Dealer advances $(16,347,272)
Other (net) 146,272
------------
Total deferred income taxes $(16,201,000)
============
(5) STOCK PLANS
PGI has a Stock Incentive Plan (the 1997 Plan) to provide incentives to
certain employees who have contributed and are expected to contribute
materially to the success of PGI and its subsidiaries. An aggregate total
of 1,500,000 shares of PGI common stock may be awarded to participants
under the 1997 Plan. Under the 1997 Plan, PGI may grant restricted stock
awards, stock options and other stock-based awards. The 1997 Plan
expires in February 2007. The 1997 Plan is administered by the
compensation committee of PGI's Board of Directors (the Committee). PGI's
1995 Restricted Stock Plan (the 1995 Plan) and 1988 Stock Option Plan
(the 1988 Option Plan) were terminated on May 20, 1997 upon approval of
the 1997 Plan by PGI's stockholders.
PGI's 1990 Restricted Stock Plan (the 1990 Plan) expired in January 1995.
Total shares awarded, net of forfeitures, under the 1990 Plan were
715,404. Total shares awarded, net of forfeitures, under PGI's 1995 Plan
and 1997 Plan were 206,621 and 27,875, respectively.
In 1997, certain employees of the Company were awarded 17,355 shares of
PGI common stock under the 1995 Plan, with a fair market value on the
award date of approximately $408,000. Total shares awarded to certain
employees of the Company, net of forfeitures, under the 1995 Plan and
1990 Plan were 26,975 and 120,363, respectively, at December 31, 1997.
Under the 1995 Plan, the participant's right to resell the awarded stock
is restricted to 100% of the shares awarded during the first two years
following the award, 60% during the third year and 20% less each year
thereafter. PGI may repurchase unvested restricted shares at $.10 per
share upon termination of the participant's employment.
Awards under the restricted stock plans are compensatory, and
accordingly, the difference between the award price and market price of
the shares under the plans on the award date, less the applicable tax
benefit, is being amortized on a straight-line basis over a five-year
period. The Company expensed $242,000 in connection with these plans,
which is included in salaries and benefits in the accompanying
consolidated statement of operations.
Under the 1997 Plan, PGI may grant to key employees, consultants and
advisors, options to purchase PGI's common stock. Both incentive stock
options intended to qualify under Section 422A of the Internal Revenue
Code of 1986 (incentive stock options) and nonstatutory options not
intended to qualify for incentive stock option treatment (nonstatutory
options) may be granted under the 1997 Plan. Unless the 1997 Plan is
earlier terminated, no option may be granted after February 3, 2007. The
option price per share is determined by the Committee, but (i) in the
case of incentive stock options, may not be less than 100% of the fair
market value of such shares on the date of option grant, and (ii) in the
case of nonstatutory options, may not be less than 90% of the fair market
value on the date of option grant. Options issuable under the 1997 Plan
become exercisable, as determined by the Committee, not to exceed 10
years from the date of grant. Options granted to date vest over five
years at an annual rate of 20% on each anniversary date of the date of
grant. Prior to the adoption of the 1997 Plan, options were granted under
the 1988 Option Plan. During 1997, 37,500 of incentive stock options were
granted under the 1997 Plan at exercise prices ranging from $22.875 to
$29.875. As of December 31, 1997, nonstatutory options to purchase
367,500 shares of PGI common stock at exercise prices ranging from $4.188
to $27.50, equal to fair market value at the dates of the grants, were
granted to certain employees of the Company under the 1988 Option Plan.
Of such options, 52,000 shares were exercised at prices ranging from
$4.188 to $18.25, and 18,000 shares were forfeited as of December 31,
1997.
On May 4, 1995, PGI adopted the 1995 Employee Stock Purchase Plan (the
1995 Purchase Plan), which qualifies as an "Employee Stock Purchase Plan"
within the meaning of Section 423 of
22
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
the Internal Revenue Code of 1986. An aggregate total of 500,000 shares
of common stock have been authorized for issuance under the 1995 Purchase
Plan, to be implemented through one or more offerings, each approximately
six months in length beginning on the first business day of each January
and July. The price at which shares may be purchased during each offering
will be the lower of (i) 85% of the closing price of the common stock as
reported on the NASDAQ National Market (the closing price) on the date
that the offering commences or (ii) 85% of the closing price of the
common stock on the date the offering terminates. In 1997, employees of
the Company purchased 7,491 shares under the 1995 Purchase Plan.
The Company has determined based on the analysis and assumptions prepared
by management that the disclosure requirements pursuant to SFAS No. 123,
ACCOUNTING FOR STOCK-BASED COMPENSATION, are immaterial to these
financial statements taken as a whole.
(6) BENEFIT PLANS
PGI and its subsidiaries have two defined contribution benefit plans for
eligible employees: a retirement benefit plan and a savings and
investment plan (collectively, the Plans) qualified under Section 401 of
the Internal Revenue Code. PGI makes contributions to a trustee, on
behalf of eligible employees, to fund both Plans.
Both of the Plans cover all full-time employees who have met certain age
and length-of-service requirements. Regarding the retirement benefit
plan, the Company contributes an amount that would purchase a certain
targeted monthly pension benefit at the participant's normal retirement
date. In connection with the savings and investment plan, participants
may voluntarily contribute up to 10% of their compensation, and the
Company will match this contribution up to 2%. The Company's expenses
under the Plans amounted to approximately $592,000 in 1997.
(7) RELATED PARTY TRANSACTIONS
Certain officers and/or directors of the Company are partners of Hale
and Dorr LLP, the Company's legal counsel. Amounts paid by the Company
for legal services of Hale and Dorr LLP amounted to approximately $33,000
in 1997.
During 1997, the Company was charged by PGI and affiliates for office
rental, equipment expense, salaries, dealer-related services and other
operating expenses. These charges represent expenses directly
attributable to the Company's operations or an allocation of its
proportionate share of these expenses using formulas that management
believes are reasonable. Included in the accompanying consolidated
statement of operations is $3,999,000 related to these charges.
During 1997, obligations in the amount of $18,725,000 owed by the Company
to PMC were canceled. The forgiveness of debt was accounted for as a
capital contribution in the accompanying consolidated financial
statements.
Included in other income is approximately $557,000, which the Company
earned from an affiliate, Pioneer Management (Ireland) Limited, for
underwriting fees on mutual funds.
(8) COMMITMENTS AND CONTINGENCIES
In 1992, PGI entered into a 10-year lease agreement. In 1994, PGI entered
into a direct lease agreement for office space rental on an additional
floor. Future minimum payments under these agreements, which are expected
to be allocated to the Company, amount to $613,000 in 1998, $637,000 in
1999, $653,000 in 2000, $668,000 in 2001, $244,000 in 2002 and $206,000
thereafter. These future minimum rental payments include estimated annual
operating expenses of approximately $280,000.
(9) DEALER ADVANCES
Certain of the Pioneer Family of Mutual Funds maintain a multi-class
share structure whereby the participating funds offer both the
traditional front-end load shares (Class A shares) and back-end load
shares (Class B and Class C shares). Back-end load shares do not require
the investor to pay any sales charge unless there is a redemption before
the expiration of the minimum holding period, which ranges from three to
six years in the case of Class B shares and one year in the case of Class
C shares. However, the Company pays upfront sales commissions (dealer
advances) to broker-dealers ranging from 2% to 4% of the sales
transaction amount on Class B shares and 1% on Class C shares. The
participating funds pay the Company distribution fees of 0.75% and
service fees of 0.25% per annum of their net assets invested in Class B
and Class C shares, subject to annual renewal by the participating fund's
Board of Trustees. In addition, the Company is paid a contingent deferred
sales charge (CDSC) on Class B and C shares redeemed within the minimum
holding period. The CDSC is paid based on declining rates ranging from 2%
to 4% on the purchases of Class B shares and 1% for Class C shares.
The Company capitalizes and amortizes Class B share dealer advances for
financial statement purposes over periods that range from three to six
years depending on the participating fund. The Company capitalizes and
amortizes Class C share dealer advances for financial statement purposes
over a 12-month period. The Company deducts the dealer advances in full
for tax purposes in the year such advances are paid. Distribution and
service fees received by the Company from participating funds are
recorded in income as earned. CDSC received by the Company from redeeming
shareholders reduce unamortized dealer advances directly.
23
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
COMPUTATION OF NET CAPITAL UNDER RULE 15c3-1
OF THE SECURITIES EXCHANGE ACT OF 1934
SCHEDULE I
DECEMBER 31, 1997
COMPUTATION OF NET CAPITAL:
Consolidated stockholder's equity $38,527,466
Less--Retained earnings of subsidiary 325,073
-----------
Unconsolidated stockholder's equity 38,202,393
Deduct--Nonallowable assets before consolidation-
Receivables and other assets* 46,186,938
Furniture, equipment and leasehold improvements 447,238
Investments in and receivables from affiliates* 3,282,263
Haircuts on securities and outstanding wire trades 1,067,843
Add--Deferred income taxes, associated with dealer
advances 16,347,272
-----------
Net capital $ 3,565,383
===========
COMPUTATION OF AGGREGATE INDEBTEDNESS:
Total liabilites net of deferred income taxes before
consolidation* $17,011,572
-----------
Aggregate indebtedness $17,011,572
===========
COMPUTATION OF BASIC NET CAPITAL REQUIREMENT:
Minimum net capital required 6-2/3% of aggregate
indebtedness $ 1,134,105
Net capital in excess of requirement 2,431,278
-----------
Net capital $ 3,565,383
===========
RATIO OF AGGREGATE INDEBTEDNESS TO NET CAPITAL 4.77 to 1
===========
RECONCILIATION WITH COMPANY'S
COMPUTATION (INCLUDED IN PART IIA OF
FORM X-17A-5 AS OF DECEMBER 31, 1997)
NET CAPITAL, AS REPORTED IN COMPANY'S PART IIA
(UNAUDITED) FOCUS REPORT $ 3,537,659
NET INCREASE IN PREPAID SERVICE FEES--NONALLOWABLE
ASSET (308,000)
NET INCREASE RESULTING FROM DEFERRED TAX ADJUSTMENTS 335,724
-----------
Net capital, as adjusted $ 3,565,383
===========
* THE COMPUTATION OF NET CAPITAL AND AGGREGATE INDEBTEDNESS REQUIRES CERTAIN
RECLASSIFICATIONS FROM THE COMPANY'S CONSOLIDATED STATEMENT OF FINANCIAL
CONDITION.
24
<PAGE>
PIONEER FUNDS DISTRIBUTOR, INC.
COMPUTATION FOR DETERMINATION OF RESERVE REQUIREMENTS
FOR BROKER-DEALERS UNDER RULE 15c3-3
OF THE SECURITIES EXCHANGE ACT OF 1934
SCHEDULE II
Pioneer Funds Distributor, Inc. is exempt from the reserve requirements of Rule
15c3-3, as its transactions are limited to the purchase, sale and redemption of
redeemable securities of registered investment companies. The Company promptly
transmits all customer funds and delivers all securities received in connection
with activities as a broker-dealer, and does not otherwise hold funds or
securities for, or owe money or securities to, customers; accordingly, the
computation for determination of reserve requirements pursuant to Rule 15c3-3
and information relating to the possession or control requirements pursuant to
Rule 15c3-3 are not applicable. In the opinion of management, the Company has
complied with the exemptive provisions of Rule 15c3-3 throughout the year ended
December 31, 1997.
25
<PAGE>
Pioneer
Independence
Plans
60 STATE STREET
BOSTON, MASSACHUSETTS 02109
INDEPENDENT PUBLIC ACCOUNTANTS SPONSOR AND PRINCIPAL UNDERWRITER
ARTHUR ANDERSEN LLP PIONEER FUNDS DISTRIBUTOR, INC.
LEGAL COUNSEL PLAN ACCOUNT CUSTODIAN
HALE AND DORR LLP STATE STREET BANK AND TRUST COMPANY
225 FRANKLIN STREET
BOSTON, MASSACHUSETTS 02110
<PAGE>
The prospectus for the Fund contained in Pre-Effective Amendment No. 1 to
its registration statement on Form N-1A, filed with the Securities and Exchange
Commission on March 12, 1998 (Accession No. 0001051010 - 98 - 000004), is
incorporated herein.
<PAGE>
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, as amended, the undersigned registrant undertakes to file
with the Securities and Exchange Commission such supplementary and periodic
information, documents and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
CONTENTS OF REGISTRATION STATEMENT
This registration statement comprises the following papers and
documents:
The facing sheet
Reconciliation and tie of information in Prospectus with items of
Form N-8B-2
The Prospectus consisting of 26 pages
The prospectus for Pioneer Independence Fund (underlying security)
The undertaking to file reports
Signatures
Written consents of the following person: Arthur Andersen LLP (see
Exhibit 1(B))
The following exhibits:
EXHIBIT NO. DESCRIPTION
1. (A)(1) Custodian Agreement between Pioneer Funds
Distributor, Inc. and State Street Bank and Trust
Company (depositor and custodian, respectively)*
1. (A)(2) Not applicable
1. (A)(3)(a) Not applicable
1. (A)(3)(b) Form of Sales Agreement between Pioneer Funds
Distributor, Inc. and other broker-dealers*
1. (A)(3)(c) Schedules of sales commissions*
1. (A)(4) Not applicable
1. (A)(5) Not applicable
1. (A)(6) Certificate of incorporation and by-laws of Pioneer
Funds Distributor, Inc.**
1. (A)(7) Not applicable
1. (A)(8) Form of Underwriting Agreement between Pioneer Funds
Distributor, Inc. and Pioneer Independence Fund**
1. (A)(9) Not applicable
<PAGE>
EXHIBIT NO. DESCRIPTION
1. (A)(10) Forms of investment application*
1. (B) Written consents of Arthur Andersen LLP*
2. Opinion of counsel as to the legality of the
securities being registered*
3. (1)(b) Not applicable
3. (1)(c) Not applicable
4. Not applicable
5. Financial Data Schedule*
___________________________
*Filed herewith.
**Previously filed. Incorporated herein by reference
from the exhibits filed with Registrant's initial
Registration Statement (File No. 333-42113) as
filed with the Securities and Exchange Commission
on December 12, 1997 (Accession No. 0001016964-97-
000166).
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the sponsor
of the registrant has caused this registration statement to be signed on behalf
of the registrant thereto duly authorized in the City of Boston and the
Commonwealth of Massachusetts on the 12th day of March, 1998.
PIONEER INDEPENDENCE PLANS
(Name of Registrant)
By: PIONEER FUNDS DISTRIBUTOR, INC.
By: /s/ John F. Cogan, Jr.
John F. Cogan, Jr.
Chairman
Pursuant to the requirements of the Securities Act of 1933, the
registrant's sponsor has duly caused this registration statement to be signed on
the registrant's behalf by following persons in the capacities indicated on
March 12, 1998:
Signature Title
/s/ John F. Cogan, Jr. Chairman (Chief Executive )
John F. Cogan, Jr. Officer) and Director, Pioneer )
Funds Distributor, Inc. )
)
)
/s/ Robert L. Butler Director, Pioneer Funds )
Robert L. Butler Distributor, Inc. )
)
)
/s/ David D. Tripple Director, Pioneer Funds )
David D. Tripple Distributor, Inc. )
)
)
/s/ William H. Keough Treasurer (Principal Financial )
William H. Keough and Accounting Officer), )
Pioneer Funds Distributor, Inc. )
CUSTODIAN AGREEMENT
BETWEEN
PIONEER FUNDS DISTRIBUTOR, INC.
AND
STATE STREET BANK AND TRUST COMPANY
<PAGE>
TABLE OF CONTENTS
PAGE
I. PIONEER INDEPENDENCE PLANS AND CUSTODIANSHIP..............................2
A. PIONEER INDEPENDENCE PLANS.......................................2
1. NATURE OF PIONEER INDEPENDENCE PLANS..................2
2. CHANGES IN PIONEER INDEPENDENCE PLANS.................2
B. CUSTODIAN......................................................3
1. QUALIFICATION.........................................3
2. CUSTODIANSHIP.........................................5
3. TERMINATION OF CUSTODIANSHIP..........................6
C. SPONSOR........................................................6
1. TERMINATION OF OBLIGATIONS............................6
II. CUSTODIAN'S FUNCTIONS...................................................9
A. PROCESSING OF PLAN INVESTMENTS.................................9
1. ISSUANCE OF NEW PLANS.................................9
2. APPLICATION OF INVESTMENTS UNDER ISSUED AND
OUTSTANDING PLANS....................................10
3. ADDITIONAL NOTICES...................................12
4. REINVESTMENT OF DIVIDENDS............................13
5. ACCELERATION OF INVESTMENTS..........................14
6. EXTENDED INVESTMENT OPTION...........................15
7. CHANGES IN FACE AMOUNT...............................15
8. RIGHTS OF ACCUMULATION...............................17
9. PLAN REINSTATEMENT PRIVILEGE........................18
10. TAX-QUALIFIED RETIREMENT ACCOUNTS....................18
11. RECORDKEEPING........................................18
B. PROCESSING OF REFUNDS, SURRENDERS, WITHDRAWALS,
LIQUIDATIONS, TRANSFERS, ASSIGNMENTS, TERMINATIONS
AND COMPLETIONS...............................................19
1. GENERAL..............................................19
2. REFUND...............................................20
3. EIGHTEEN MONTH SURRENDER.............................20
4. PARTIAL WITHDRAWAL AND LIQUIDATION...................22
5. SYSTEMATIC WITHDRAWAL PROGRAM........................23
i
<PAGE>
6. TRANSFER OR ASSIGNMENT...............................24
7. TERMINATION OF PLANS.................................24
8. COMPLETION...........................................26
C. PURCHASE, SALE, MAINTENANCE, VOTING AND SUBSTITUTION
OF FUND SHARES................................................28
1. PURCHASE AND SALE OF FUND SHARES.....................28
2. MAINTENANCE..........................................31
3. STATEMENTS...........................................32
4. VOTING OF FUND SHARES................................33
5. SUBSTITUTION.........................................33
6. FURNISHING OF INFORMATION............................34
D. DUTIES........................................................34
1. DUTIES...............................................34
E. FEES AND CHARGES..............................................36
1. REMUNERATION.........................................36
2. PAYMENTS TO SPONSOR..................................37
III. SPONSOR'S FUNCTION....................................................37
A. ADMINISTRATION OF PIONEER INDEPENDENCE PLANS..................37
1. GENERAL..............................................37
2. OPERATIONS...........................................37
3. INITIAL INVESTMENT...................................43
4. CREATION AND SALES CHARGES...........................38
5. PLANS IN DEFAULT....................................39
6. PLAN CANCELLATIONS..................................39
B. FURNISHING OF DOCUMENTS, FORMS AND INFORMATION................39
C. SUBSTITUTION OF THE UNDERLYING INVESTMENT.....................41
1. PROCEDURE............................................41
IV. FUNCTIONS OF SPONSOR AND CUSTODIAN.....................................43
A. PLANHOLDER INQUIRIES..........................................43
V. MISCELLANEOUS...........................................................44
A. ASSIGNMENT....................................................44
B. INDEMNIFICATION BY THE SPONSOR................................44
C. INDEMNIFICATION BY THE CUSTODIAN..............................44
D. COUNTERPARTS..................................................45
E. INSPECTION....................................................46
F. SCHEDULES.....................................................46
ii
<PAGE>
G. AMENDMENT.....................................................46
H. CONSTRUCTION..................................................46
iii
<PAGE>
CUSTODIAN AGREEMENT
AGREEMENT made this 17th day of February, 1998, between Pioneer Funds
Distributor, Inc., a Massachusetts corporation with its office at 60 State
Street, Boston, Massachusetts (hereinafter called the "Sponsor") and State
Street Bank and Trust Company, a Massachusetts trust company having an office at
225 Franklin Street, Boston Massachusetts (hereinafter called the "Custodian").
WITNESSETH:
WHEREAS, the Sponsor is registered as a broker-dealer with the Securities
and Exchange Commission under the Securities Exchange Act of 1934, as amended
(hereinafter, the "1934 Act"), is a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD") and was formed to sell
investment company products to other registered broker-dealers; and
WHEREAS, Pioneer Independence Plans is a unit investment trust registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), providing
for the accumulation of shares of Pioneer Independence Fund (the "Fund"); and
WHEREAS, the Fund is a Delaware business trust registered as an open-end
management investment company under the 1940 Act; and
1
<PAGE>
WHEREAS, the Sponsor desires to obtain the services of the Custodian in
connection with the administration of Pioneer Independence Plans providing for
investment in shares of the Fund or shares of other open-end management
investment companies as herein provided;
NOW, THEREFORE, in consideration of their mutual covenants herein set
forth, the parties hereto agree as follows:
I. PIONEER INDEPENDENCE PLANS AND CUSTODIANSHIP
A. PIONEER INDEPENDENCE PLANS.
1. NATURE OF PIONEER INDEPENDENCE PLANS. The Sponsor intends to offer
Pioneer Independence Plans for the accumulation of shares of the Fund (all such
shares being hereinafter called the "Fund Shares"), or any other shares
substituted therefor, under the terms of Pioneer Independence Plans. Holders of
each Pioneer Independence Plan (a "Plan") issued under Pioneer Independence
Plans are hereinafter called "Planholders." Issuance and transfer of the Plans
will be by book entry only.
2. CHANGES IN PIONEER INDEPENDENCE PLANS. Each Plan shall be governed by
the terms and conditions set forth in the prospectus for such Plan in effect at
the time such Plan was issued (the "Prospectus"). Pioneer Independence Plans are
subject to such changes in form and content as the Sponsor may effect from time
to time. No changes in the terms and conditions of any previously issued and
outstanding Plan which will adversely affect any material right of a Planholder
thereof may be made without notice to, and consent of, the Planholder. Any such
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changes in Pioneer Independence Plans affecting the implementation of the
provisions of this Agreement shall be acknowledged by the Sponsor and the
Custodian. The Sponsor or Custodian may substitute other shares for Fund Shares
on the conditions provided in Sections II(C)(5) and III(C) below.
B. CUSTODIAN.
1. QUALIFICATION.
a. The Custodian and any successor Custodian shall be a bank
or trust company, as defined under the 1940 Act, having at all times an
aggregate capital, surplus and undivided profits in excess of
$2,000,000. The Custodian covenants that it has now, and agrees that so
long as it acts as Custodian under any Plan it shall continue to have,
such qualifications.
b. All monies received by the Custodian under or pursuant to
any provision of this Agreement or any Plan or other instrument
referred to herein shall be held by the Custodian as a deposit for the
purposes for which they were paid or are held, and the Custodian shall
not be under any liability for interest on any such monies, except such
as it may agree to pay thereon.
c. The Custodian shall be obligated to perform such duties and
only such duties as are specifically set forth in this Agreement and
the Prospectus, and no implied obligations shall be read into this
Agreement or the Prospectus against the Custodian, and
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in the absence of bad faith on its part, the Custodian may conclusively
rely, as to the truth of the statements and the correctness of the
representations made therein, upon any instruments, certificates,
opinions or other writings furnished to the Custodian and conforming to
the requirements hereof. The Custodian shall not be responsible in any
manner whatsoever for the correctness of the covenants of the Custodian
herein, or recitals in the Prospectus made solely by the Sponsor. The
Custodian makes no representations as to the Prospectus or the
securities issued in connection therewith, or the validity thereof, and
the Custodian shall incur no liability or responsibility with respect
to any such matters. The Custodian shall not be responsible for any
actions or inactions of, and may rely on information, records,
documents or services (including functions performed by the Sponsor
under Section II. (D)(1)(h) of this Agreement) that have been taken or
have failed to be taken, prepared, maintained or performed by, the
Sponsor or any other person authorized by the Sponsor on behalf of the
Custodian, the Sponsor or Pioneer Independence Plans.
d. The Custodian may, at the same time it acts hereunder, act
in any one or more of the following capacities: as registrar, transfer
agent and custodian for the issuer of Fund Shares, as agent for the
parties or for the Planholders or the Sponsor, or the issuer of Fund
Shares, and in other capacities customary for banks on behalf of these
persons and of others dealing with them.
e. The Custodian may consult with legal counsel to be selected
with reasonable care by the Custodian (who may be counsel to the
Sponsor) and the Custodian shall not be liable for any action taken,
omitted or suffered by it in good faith in accordance
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with the advice of such counsel. Whenever in the performance of its
duties hereunder the Custodian shall deem it necessary or desirable, a
matter may be proved or established by a certificate signed by any two
officers of the Sponsor and delivered to the Custodian, and such
certificate shall be fully warranted to the Custodian for any action
taken, suffered or omitted by or in reliance thereon. The Custodian
may, in the absence of bad faith on its part, rely and shall be
protected in acting upon any request , letter or transmittal ,
certificate, opinion of counsel, statement, instrument, report, notice,
consent, order, Plan or other paper or document reasonably believed by
it to be genuine and to have been signed or presented by the proper
party or parties. The Custodian shall be liable for its willful
misconduct or negligence.
2. CUSTODIANSHIP. The Custodian accepts the custodianship hereunder with
respect to Plans issued after the date of this Agreement and shall continue
custodianship on the terms and conditions set forth in this Agreement and in the
Prospectus applicable to such Plans, provided that the Custodian may require the
Sponsor to furnish the following items to the Custodian as a condition to
accepting custodianship with respect to a Plan:
a. Evidence satisfactory to the Custodian that the Sponsor has
taken all necessary action to satisfy the requirements of the
Securities Act of 1933, as amended (the "1933 Act") and the 1940 Act in
connection with the offer and issuance of the Plans; that the Sponsor
is registered as a broker-dealer under the 1934 Act and is a member in
good standing of the NASD; that the Fund Shares are the subject of a
currently effective
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registration statement under the 1933 Act; and that the Sponsor has
complied with all other federal and state regulatory requirements
respecting the offer and issuance of the Plans.
b. Such additional documents, certificates and opinions as the
Custodian may reasonably require.
3. TERMINATION OF CUSTODIANSHIP.
a. Replacement of Custodian by Sponsor; Assumption of
Administrative Functions by Sponsor (Existing Plans and/or New Plans).
The Sponsor shall have the right, upon at least 90 days' written notice
to the Custodian, to substitute, as custodian, both under Pioneer
Independence Plans issued and still in force and/or under any Pioneer
Independence Plans issued thereafter, whether such Pioneer Independence
Plans are otherwise identical with that issued under this Agreement or
not, any other bank or trust company having the qualifications
prescribed in Section I(B)(1)(a) above. The Sponsor shall further have
the right, by giving written notice to the Custodian 90 days prior to
the event, to assume such administrative functions with respect to
Pioneer Independence Plans as may be mutually agreed by the Sponsor and
the Custodian.
Upon such termination, the Sponsor shall bear the cost of all
reasonable out - of - pocket expenses associated with the movement of
materials and records. Additionally, the Custodian reserves the right
to charge for any other reasonable expenses associated with
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such termination, provided that the Custodian advises the Sponsor of
such additional charges in advance.
b. RESIGNATION BY CUSTODIAN (EXISTING PLANS AND/OR NEW PLANS).
The Custodian shall have the right to resign as custodian under any
existing Plan at any time but only if either: (a) the securities and
other property in which the funds of the Planholders are invested have
been completely liquidated and the proceeds of such liquidation have
been distributed to the Planholders; or (b) a successor custodian,
meeting with the approval of the Sponsor and having the qualifications
prescribed in Section I(B)(1)(a) above, has been designated by the
resigning Custodian or the Sponsor and the successor custodian has
accepted such custodianship.
Notwithstanding the above, the Custodian shall have the right,
upon at least 90 days' written notice to the Sponsor, to terminate its
obligation to accept any new Pioneer Independence Plans for
custodianship hereunder.
In addition, the obligation of the Custodian to accept any new
Pioneer Independence Plans for custodianship hereunder shall terminate
if the Sponsor: (1) fails to maintain an effective registration
statement under the 1933 Act covering the issuance of Pioneer
Independence Plans; (2) fails to cause the requirements of the 1940 Act
to remain satisfied in connection with the issuance of Pioneer
Independence Plans; (3) has its membership in the NASD or its
registration as a broker-dealer under the 1934 Act canceled, revoked or
suspended for more than 120 days for any cause involving failure on
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the part of an executive officer or director of the Sponsor to follow
ethical standards or serious neglect of his or her duty to require
representatives to follow such standards; or (4) defaults in the
performance of any other duty, covenant or agreement contained in this
Agreement and such default shall remain unremedied for 30 days after
written notice thereof shall have been given to the Sponsor by the
Custodian (except with respect to item (3), for which such remedy
period shall be 120 days).
c. RECORDS. In connection with any termination of
custodianship, the Custodian shall furnish such records and other
information as the Sponsor and any successor custodian reasonably
believe to be necessary or appropriate to effect the termination.
C. SPONSOR.
1. TERMINATION OF OBLIGATIONS.
The Sponsor may terminate its obligations under the Plans
under certain circumstances including, but not limited to,
circumstances where: the underlying fund (or any successor) ceases
operations or is subject to a merger or acquisition; or the
shareholders of the underlying fund have approved the cessation of
operations or merger or acquisition; or the obligations of the Sponsor
as described in the Prospectus and this Agreement will be assumed by
another entity that the Sponsor believes at the time of
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assignment is capable of fulfilling its obligations as described in the
Prospectus and under this Agreement.
II. CUSTODIAN'S FUNCTIONS
A. PROCESSING OF PLANHOLDER INVESTMENTS.
1. ISSUANCE OF NEW PLANS. Upon receipt by the Custodian or its agent of:
(1) an application for a Plan (a "Plan Application") in a form designated by the
Sponsor, and (2) a check or other order for the payment of money representing
the initial investment under a Plan by the Planholder thereof, the Custodian
shall:
a. Establish a Plan account ("Plan Account") for such
Planholder that reflects the face amount of the new Plan;
b. Forward for collection such check or other order for the
payment of money as hereinafter provided in Section
(II)(A)(2)(a); and
c. Forward to the Planholder by first - class mail, the
Custodian's letter of transmittal and notice conforming to
the requirements of Section 27(f) of the 1940 Act, Rule
27f-1 thereunder (or any successor rule) and as described
in the Prospectus, such other explanatory information or
communication to the Planholders as may be furnished by the
Sponsor, and forward to the Planholder or, if requested by
the Sponsor, to the Sponsor for forwarding to the
Planholder, by first-class mail any notice of the right of
refund or
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surrender, as provided in Sections II(B)(2), (3) and (4)
below. Such forms of notice shall be approved in writing by
the Sponsor.
2. APPLICATION OF INVESTMENTS UNDER ISSUED AND OUTSTANDING PLANS. Upon
receipt by the Custodian or its agent of any Plan investment that is made in
accordance with the applicable Prospectus, including any investment being made
pursuant to an extended investment option, the Custodian shall:
a. Forward for collection any check or other order for the
payment of money representing such investment. In the event that any
check or other order for the payment of money received by the Custodian
from a Planholder is returned unpaid for any reason, the Sponsor agrees
that the amount thereof shall be forthwith charged by the Custodian to
the Plan Account of the Planholder with the Custodian. The Custodian
shall forthwith place a stop order against the Fund Shares purchased
with the amount so charged and held in the Plan Account of the
Planholder, and such Fund Shares shall thereafter be held by the
Custodian for the account of the Sponsor and subject to its
instructions including, but not limited to, any instructions by the
Sponsor to redeem the Fund Shares purchased with such check or other
order for payment of money. The Custodian shall notify the Planholder
of any such returned check and send a copy of such notice together with
the returned check to the Sponsor (if the returned item is an order for
payment of money, the Custodian shall send the notification of the
unpaid order). The Custodian shall, in accordance with the terms of the
Plan Prospectus, impose a fee for any such returned checks or orders or
hold
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redemption proceeds pending the receipt of payment with respect to
the Fund Shares redeemed of any check (or order for the payment of
money) from the payor bank thereon.
b. Deduct from the payment the amount of any applicable
original issue, stock transfer, sales or other taxes and apply such
amounts to the purchase of the necessary tax stamps or to payments to
the proper taxing authorities, as the case may be.
c. Deduct therefrom the applicable fees of the Sponsor and the
Custodian as set forth in Schedule A to this Agreement applicable to
such Plan. Such deductions shall be credited to the Sponsor or the
Custodian, as the case may be.
d. Apply, within two business days unless impracticable, the
balance of the investment to the purchase of Fund Shares, at net asset
value next determined ( to be computed to two decimal places) after
receipt of the investment in good order, and credit the Plan Account
with the number of Fund Shares so purchased.
e. Prepare and mail to the Planholder a receipt in a form to
be approved by the Sponsor, and which complies as to form and delivery
with the requirements of Rule 10b-10 of the 1934 Act (or any successor
rule), and which receipt shall show the following: the Plan account
number; the amount of the investment received; the date of receipt; the
front - end sales load (the "Creation and Sales Charge") deducted, if
applicable; the price paid per Fund Share; the number of full and
fractional Fund Shares purchased after the deductions; the total number
of Fund Shares then held by the Custodian for the Planholder; and the
due date of the Planholder's next investment. The receipt of the
purchase of Fund Shares shall
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be mailed promptly by the Custodian to the Planholder, and to the
Planholder's investment dealer.
3. ADDITIONAL NOTICES.
a. REMINDER NOTICES. The Custodian shall mail to each
Planholder who has not elected an automatic investment option prior to
the Planholder's investment date a remittance form and, unless
otherwise agreed to, a return envelope to be used with the Planholder's
next investment. Such form of notice shall be approved in writing by
the Sponsor.
b. PAST DUE INVESTMENT NOTICES. On a periodic basis as agreed
to from time to time by the Custodian and the Sponsor, the Custodian
shall prepare and mail to the Planholder a notice of past due
investment in accordance with the Prospectus and applicable law. Such
form shall be approved in writing by the Sponsor. The Custodian shall
provide to the selling broker-dealer, or in the absence of such, the
Sponsor, a duplicate of each such notice sent to any Planholder.
c. REFUND NOTICES. The Custodian shall also mail to each
Planholder any notice(s) required by Section 27(e) of the 1940 Act and
Rule 27e-1 thereunder (or any successor rule) and shall be in
accordance with the terms and conditions of the Prospectus. Such form
of notice shall be approved in writing by the Sponsor.
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d. TERMINATION NOTICES. In the event that a Plan is being
terminated by the Sponsor or the Custodian in accordance with the terms
of the Prospectus and this Agreement, the Custodian shall also mail or
deliver to the affected Planholder a notice of termination. The
Custodian will provide the selling broker-dealer or, in the absence of
such, the Sponsor with a duplicate of each such notice sent to any
Planholder. Such form of notice shall be approved in writing by the
Sponsor.
e. OTHER NOTICES. The Custodian shall also mail or deliver to
each Planholder any other notices required by any applicable federal or
state law, rule or regulation, in such form and by such means as are
required under such law, rule or regulation. The form of any such
notice shall be approved in writing by the Sponsor.
4. REINVESTMENT OF DIVIDENDS. The Custodian shall reinvest all dividends
and capital gain distributions received on the Fund Shares held by it as
Custodian for each Planholder, after deduction therefrom the applicable fees set
forth in the attached Schedule and/or specified in the Prospectus, and any
applicable taxes required by law or elected by a Planholder to be withheld, in
accordance with the terms of the Prospectus, in Fund Shares on the dividend
payment date, at the net asset value, determined on that date, as provided in
Section II(C)(1) below, unless the Planholder has instructed the Custodian, in
writing, at least seven days prior to the record date, to pay the dividends or
distributions in cash directly to the Planholder.
5. ADVANCE INVESTMENTS. A Planholder may complete his or her Plan ahead of
schedule by making one or more Plan investments in advance of their due dates,
but only
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in accordance with the terms and conditions of the applicable Prospectus.
Advance investments shall be first applied to satisfy the obligation of the
Planholder to pay for his or her next succeeding Plan investment or investments.
Thereafter, the Custodian shall, unless timely advised to the contrary by the
Sponsor, invest the balance of any advance investment, after authorized
deductions, in additional Fund Shares as of the close of business on the
business day that such accelerated investment is received. The Custodian shall,
if so instructed by the Sponsor, redeem all or a portion of the Fund Shares
purchased with such advance investment and remit the proceeds of such redemption
to the Planholder. There is no reduction in the Creation and Sales Charges for
advance investments. Advance investments do not accelerate in any way the due
dates of unpaid Plan investments; such unpaid investments will be considered to
be due on that date on which they would have originally been required if all
prior Plan investments (whether or not in fact made in advance) had been made
when respectively due. Upon receipt by the Custodian of a permissible advance
investment by any Planholder, the Custodian shall:
a. Process the investment as provided in Section II (A) (2)
above.
b. Apply the balance of the investment to the next succeeding
monthly Plan investment or investments in the order due under the Plan.
6. EXTENDED INVESTMENT OPTION. A Planholder who owns any completed Plan may
make additional investments, without completing a new Plan Application, thereby
activating the extended investment option, subject to deductions in accordance
with the terms and conditions of the applicable Prospectus. The Planholder must
make the 181st investment within the six-month
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period, unless such limitation has been waived by the Sponsor, after the
180th investment date in order to activate the extended investment option;
failure of a Planholder to make the 181st investment within such six-month
period after being credited for any advance investments made under the option
will result in the Planholder's forfeiture of his or her right to make
additional investments under the extended investment option, and the Plan will
be considered to have been completed. In addition, failure of a Planholder,
during the extended investment option period, to make any investment during any
six-month period (after any credit for any accelerated investment) may result in
the Planholder's forfeiture of his or her right to make any investments under
the extended investment option, and the Plan will be considered to have been
completed.
All Plans exercising the extended investment option shall terminate after
the 300th investment made under the Plan.
7. CHANGES IN FACE AMOUNT. A Planholder may change the Plan face amount
initially selected upon issuance of a Plan to a new Plan face amount offered by
the Sponsor, but only in accordance with the terms and conditions of the
applicable Prospectus. Plans are only available in face amounts offered by the
Sponsor, as set forth in the Prospectus. If such a change in the Plan face
amount is approved by the Sponsor, the Custodian shall make appropriate changes
to the Planholder's Account. Changes in the face amount of a Plan shall be
implemented by the Custodian only upon receipt of:
a. written instructions from the Planholder, Sponsor or
selling broker-dealer, as applicable, as to the increase or decrease in
Plan face amount, which instructions shall
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set forth the Plan Account number and registration, the face amount of
the new Plan, the amount of each monthly investment under the new Plan,
the number of Plan investments which are to be credited to the new
Plan, and the amount, if any, of the adjustment in Creation and Sales
Charges resulting from the change in Plan face amount, which adjustment
shall be effected at the time of the issuance of the new Plan, and such
other information as may be reasonably requested by the Custodian. Such
adjustment shall be in accordance with the terms of the applicable
Prospectus and shall be effective concurrently with the change in Plan
face amount, I.E., at the time the Plan is adjusted to reflect the new
face amount;
b. in the case of an increase in a Plan face amount, payment
by check or other order for the payment of money in the amount of the
first Plan investment to be made under the increased face amount for
the Plan, as specified in the applicable Prospectus, unless such
investment is reduced or waived by the Sponsor;
c. if the total investments made on the original Plan are not
an integral multiple of the monthly Plan investments required on the
amended Plan, a check or other order for the payment of money in the
sum that is required by the Sponsor to enable the remaining monthly
investments (after giving credit for investments already made) to equal
the face amount of the amended Plan.
8. RIGHTS OF ACCUMULATION. A Planholder may accumulate Plans for reduced
Creation and Sales Charges, but only in accordance with the terms and conditions
of the applicable
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Prospectus. The face amounts of two or more Plans purchased at one time by
"any person," as defined in the applicable Prospectus may be combined to take
advantage of the lower Creation and Sales Charges available on larger purchases.
In addition, a Planholder purchasing any new Plan or increasing the face amount
of any existing Plan(s) may qualify for a reduced Creation and Sales Charge on
the new Plan by combining the face amount of the new Plan with the face amounts
of existing Plans on which Plan investments due are current and/or with the
current value of assets held in accounts in other Pioneer mutual funds for which
Pioneering Management Corporation or one of its affiliates serves as investment
adviser. To qualify for the reduced Creation and Sales Charges, all of the Plan
Applications for the new Plans involved must be submitted to the Sponsor at the
same time together with a request in writing that the face amounts of such Plans
and/or asset values of such Pioneer mutual fund accounts be cumulated for the
purpose of determining the applicable Creation and Sales Charge for the new
Plan. If such a reduction in the Creation and Sales charge is approved by the
Sponsor, the Custodian shall make appropriate changes to the Planholder's
Account. In the event investments in one or more of such Plans are discontinued,
the remaining Creation and Sales Charge will be changed to reflect the charges
applicable to the Plan that is still in effect.
The face amounts of any Plans which have been completed (and not
liquidated) or on which investments are current may be aggregated with the face
amount of a Plan being purchased by "any person" to ascertain the Creation and
Sales Charge applicable to the Plan being purchased. To qualify for a reduced
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Creation and Sales Charge, the Sponsor must be notified by the dealer or the
Planholder at the time of placing the order that the Planholder qualifies for
the reduced Creation and Sales Charge. If such a reduction in the Creation and
Sales Charge is approved by the Sponsor, the Custodian shall make appropriate
changes to the Planholder's Account.
9. PLAN REINSTATEMENT PRIVILEGE. A Planholder who has terminated his or her
Plan may exercise a Plan reinstatement or replacement provision, which provides
for reinvestment of a specified amount in the Plan, but only in accordance with
the terms and conditions of the applicable Prospectus. If the Plan reinstatement
privilege is exercised, neither the total number of monthly Plan investments to
be made nor the unpaid balance of monthly Plan investments due under the Plan
will be affected. Any such reinstatement or replacement order received by the
Custodian or its agent shall be processed by the Custodian and credited for the
Plan Account of such Planholder in accordance with the terms and conditions of
the applicable Prospectus, this Agreement and the 1940 Act.
10. TAX-QUALIFIED RETIREMENT ACCOUNTS. A Plan may be used by qualified
individuals who wish to establish Plan Accounts for tax-qualified retirement
plans or by an individual who wishes to register a Plan as an Individual
Retirement Account (an "IRA").
11. RECORDKEEPING.
The Custodian will prepare and maintain complete up-to-date records of the
performance of its duties hereunder, on magnetic media or otherwise, including
records showing a separate Plan Account for each Planholder, and the name and
address of the Planholder; the number, date and amount of each investment made
by the Planholder; the date and amount of all dividends and distributions
received by the Custodian on Fund Shares held for the account of the Planholder;
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any amounts withheld from withdrawals under a Plan in accordance with the
Internal Revenue Code of 1986, as amended, and any regulations thereunder (or
successor regulations); and all deductions made and the number of Fund Shares
acquired and held by the Custodian for the account of the Planholder. These
records shall be maintained and preserved in accordance with applicable
requirements of Section 31 of the 1940 Act and rules thereunder (or any
successor rule), and in accordance with state securities laws ("Blue Sky laws")
applicable to records kept with regard to the Plans. Such records shall be made
available to the Sponsor for inspection or audit via magnetic media or at the
office of the Custodian at all reasonable times.
B. PROCESSING OF REFUNDS, SURRENDERS, WITHDRAWALS, LIQUIDATIONS, TRANSFERS,
ASSIGNMENTS, TERMINATIONS AND COMPLETIONS.
1. GENERAL. The Custodian shall liquidate Fund Shares in a Planholder's
Plan Account, as provided in Section II(C)(1) below, and pay the proceeds, plus
additional amounts, if any, to the Planholder within the time set forth in the
applicable Prospectus. The Sponsor shall not suspend redemption or postpone
payment of redemption proceeds more than seven days after such date of receipt,
except during any period when: (a) the New York Stock Exchange, Inc. (the
"Exchange") is closed, other than for customary weekends and holidays; (b)
trading on the Exchange is restricted; (c) 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 (d) the Securities and Exchange
Commission, by order, so permits.
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2. REFUND. A Planholder has the right for 45 days to surrender his or her
Plan in accordance with Section 27 of the 1940 Act and the terms and conditions
of the applicable Prospectus. Upon surrender the Custodian will accept the
return of the Plan and the Planholder will receive a refund of all charges
deducted from his or her Plan investments and the net asset value of the Fund
Shares held in his or her Plan Account at the time. The 45-day period shall run
from the date on which the Planholder is mailed a notice (described in Section
II(A)(1)(c) above) of his or her refund rights, a statement of charges to be
deducted from projected investments, and a form for exercising the refund right,
which information shall be mailed by the Custodian within 60 days after the
issuance of the Plan, to the date of receipt of the Plan by the Sponsor. The
Custodian shall inform the selling broker-dealer or, in the absence of such, the
Sponsor in the event such refund procedures are initiated with respect to any
Plan Account.
3. EIGHTEEN MONTH SURRENDER. A Planholder has the privilege for 18 months
to surrender his or her Plan, but only in accordance with Section 27 of the 1940
Act and the terms and conditions of the applicable Prospectus. Upon surrender,
the Planholder will receive a payment in an amount that is the sum of: (1) the
net asset value of the Fund Shares held in his or her Plan Account at the time;
and (2) a refund of the amount by which the Creation and Sales Charges deducted
from Plan investments exceed 15% of the Plan investments made up to the date of
the surrender of the Plan. In the event the Plan is surrendered, the Custodian
shall liquidate Fund Shares and pay the proceeds to the Planholder who has
exercised the foregoing privilege. Any excess Creation and Sales Charge amount
due the Planholder shall be paid to the Custodian by the Sponsor for refund to
the Planholder. The Planholder shall not be entitled to be refunded
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any Custodian fees previously paid. The 18-month period shall run from the
date on which the Plan is issued. The Planholder must request a refund in
writing. The request must be signed by the Planholder and be addressed to the
Custodian. A cancellation request involving a Plan Account with a current asset
value of $100,000 or more (or any other amount specified in the applicable Plan
Prospectus) will require a signature guarantee for all Planholders by an
acceptable guarantor as described in the Prospectus or as shall otherwise be
approved by the Custodian and Sponsor (hereinafter referred to as an "Approved
Guarantor"). The Custodian will send to the Planholder a notice (described in
Section II(A)(1)(c) above) within 30 days following the expiration of 15 months
after the date of the issuance of a Plan if the Planholder has missed three Plan
investments or more. The Custodian will also send to the Planholder a notice
prior to the expiration of the 18-month period described above if the Planholder
has missed one Plan investment or more after the expiration of the 15-month
period but prior to the expiration of the 18-month period. (If the Custodian has
already sent a notice at 15 months, a second notice will not be required even if
additional investments are missed.) These notices will inform the Planholder of
the Planholder's rights of cancellation as set forth above, of the value of the
Plan at the time the notice is sent and of the amount to which the Planholder is
entitled. The Custodian shall inform the selling broker-dealer or, in the
absence of such, the Sponsor, in the event such refund procedures are initiated
with respect to any Plan Account.
4. PARTIAL WITHDRAWAL AND LIQUIDATION. A Planholder may make a partial cash
withdrawal from his or her Plan Account, but only in accordance with the terms
and conditions of the applicable Prospectus. The holder of a Plan which has been
established for at least 45 days
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may withdraw or liquidate part of the Fund Shares held in his or her Plan
Account without terminating the Plan, subject to the following:
a. The Planholder making a partial withdrawal of his or her
Fund Shares may direct the Custodian to transfer the Fund Shares held
in the Plan Account registered in his or her name to an identically
registered Pioneer Independence Fund account. Following a partial
withdrawal, the Planholder may, at any time prior to the termination of
the Plan under which his or her Plan Account was established, redeposit
the same number of Fund Shares.
b. A Planholder may also partially liquidate by directing the
Custodian, as Planholder's agent, to sell or redeem part of the Fund
Shares held in his or her Plan Account and to forward the net proceeds
to the Planholder. Following a partial liquidation, the Planholder may,
at any time prior to the termination of the Plan under which his or her
Plan Account was established, redeposit an amount equal to the net
proceeds withdrawn and have the Custodian purchase Fund Shares at net
asset value for his or her Plan Account as provided in Section II(C)(1)
below. Cash must be redeposited for cash received on liquidation.
Any such request for a withdrawal received by the Custodian or
its agent shall be processed by the Custodian, and proceeds shall be
payable by the Custodian to such Planholder, in accordance with the
terms and conditions of the applicable Prospectus and the 1940 Act.
Following a partial cash withdrawal, a Planholder is permitted to
exercise a
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<PAGE>
restoration or replacement privilege with respect to such
withdrawal if and to the extent such restoration or replacement is
provided for in the applicable Prospectus. Upon receipt by the
Custodian or its agent of any investment identified by the Planholder
as being a replacement or restoration of a partial withdrawal for the
account of a Planholder and that is made in accordance with the
applicable Prospectus, the Custodian will process and credit such
payment to the Plan Account in accordance with this Agreement, the
applicable Prospectus, and the 1940 Act.
5. SYSTEMATIC WITHDRAWAL PROGRAM. A Planholder may elect to establish a
systematic withdrawal program, after the Planholder has completed all regularly
scheduled Plan investments or from an incomplete Plan if the withdrawals are to
be taken from a Plan that is part of an IRA and the Planholder has reached age
59 1/2, but only in accordance with the terms and conditions of the applicable
Prospectus. Under a systematic withdrawal program, the Planholder can elect to
receive monthly or quarterly payments in any amount of $50 or more. To provide
funds for payments to be made under a systematic withdrawal program, the
Custodian, as agent for the Planholder, will redeem Fund Shares held in the
Planholder's Plan Account at the net asset value in effect at the time of each
such redemption. All systematic withdrawal program transactions will be made as
of the end of the day specified for the withdrawal by the Planholder (or, if
such day is not a business day, the first business day after that date). The
Planholder may change the amount of payments under a systematic withdrawal
program or discontinue the program at any time.
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<PAGE>
While a systematic withdrawal program is in effect, the Planholder may not
elect to receive dividends and distributions on Fund Shares held in his or her
Plan Account in cash.
6. TRANSFER OR ASSIGNMENT. A Planholder may make a transfer or assignment
of his or her right, title, and interest in the entire Plan, but only in
accordance with the terms and conditions of the applicable Prospectus. Any such
request for a transfer or assignment received by the Custodian or its agent
shall be recorded by the Custodian in accordance with the terms and conditions
of the applicable Prospectus until the assignee shall have notified the
Custodian that the transfer or assignment has terminated. The terms of any such
transfer or assignment shall be subject to the applicable Prospectus. During the
term of the transfer or assignment, such Planholder shall retain those rights
specified in the applicable Prospectus.
7. TERMINATION OF PLANS. Plans may be terminated only in accordance with
the terms and conditions of the applicable Prospectus. Plans may be terminated
under the following circumstances:
a. TERMINATION BY PLANHOLDER. A Planholder may at any time
terminate his or her Plan by surrendering the Plan to the Custodian,
but only in accordance with the terms and conditions of the applicable
Prospectus.
b. TERMINATION BY SPONSOR OR CUSTODIAN. Neither the Sponsor
nor the Custodian may terminate a Plan until such time as is specified
in the applicable Prospectus, unless and to the extent that conditions
specified in the Prospectus applicable to such Plan and permitting such
termination have been satisfied. If a Plan is in a state of default
24
<PAGE>
or delinquency, as defined in the applicable Prospectus, either the
Sponsor or the Custodian may terminate such Plan in the manner provided
in such Prospectus.
c. TERMINATION UNDER OTHER CIRCUMSTANCES. Pioneer Independence
Plans shall be terminated if Fund Shares cannot be purchased for more
than 120 days, and neither the Sponsor nor the Custodian substitutes
another investment medium as provided in Sections II(C)(5) and III(C),
below. If a Planholder fails to consent to a substitution by the
Custodian pursuant to Section II(C)(5)(b), below, the Custodian may
consider the Plan terminated.
d. PLAN TERMINATION PROCEDURES. In connection with the
termination of any Plan in accordance with the provisions of the
applicable Prospectus and this Agreement, the Custodian will furnish
the Planholder and the Sponsor with a notice of termination showing all
changes in such Planholder's Plan Account since the date of the last
previous statement issued by the Custodian, and the Planholder shall
thereafter have no further claim against the Custodian, except as may
be set forth in such statement, and shall not be entitled to any
further accounting. In the event of termination of a Plan, liquidation
of the Plan Account and final payment to the Planholder shall be
effected by the Custodian in accordance with the applicable Prospectus.
8. COMPLETION. The options described below are available for the
disposition of the Fund Shares from a completed Plan. If the disposition of Fund
Shares is such that all of the Fund
25
<PAGE>
Shares held in a Plan are transferred or liquidated, the Planholder shall
be deemed to have no further rights under the Plan, except in accordance with
the terms of the applicable Prospectus.
a. The Planholder may elect to have the Custodian hold the
Fund Shares for 15 years from the date of issuance of the Plan, plus an
additional 10 years, and neither the Custodian nor the Sponsor may
terminate the custodianship except in accordance with the terms of the
applicable Prospectus;
b. The Planholder may elect to have the Fund Shares held in
his or her Plan Account transferred to a Pioneer Independence Fund
account registered in the Planholder's name, at which time the
Planholder will be deemed to have no further rights under the Plan
except as described in the applicable Prospectus;
c. The Planholder may elect to have the Fund Shares in his or
her Plan Account redeemed and the cash proceeds paid to the Planholder
directly; or
d. The Planholder may elect to have the Fund Shares in his or
her Plan Account redeemed in accordance with the systematic withdrawal
program established in connection with the Plan on a monthly or
quarterly basis in amounts of $50 or more and have the cash proceeds
paid to the Planholder directly.
The Custodian and the Sponsor agree that no Plan may be terminated by the
Sponsor or the Custodian for a period of 15 years from the date of issue so long
as the Planholder continues to make investments in accordance with the terms of
the applicable Prospectus. After expiration of
26
<PAGE>
15 years from the date of issue of the Plan, or after the 300th investment
if the Planholder has exercised the option to extend the custodianship, the
Custodian shall include with the next to last confirmation statement a notice to
the Planholder advising the Planholder to exercise the privilege of complete
withdrawal within 60 days.
In the event of the Planholder's failure to exercise the privilege of
complete withdrawal, the Custodian in its discretion may, as agent for the
Planholder, (a) surrender for liquidation all Fund Shares in the Planholder's
Plan Account or (b) redeem sufficient Fund Shares to pay all authorized
deductions. The remaining Fund Shares and/or cash (after payment of all
authorized deductions), will be held by the Custodian for delivery to the
Planholder. Upon surrender of the Plan to the Custodian, the Custodian will
deliver to the Planholder a confirmation statement for his or her full Fund
Shares after transferring such Fund Shares to a Pioneer Independence Fund
account registered in the name of the Planholder and any balance of cash, or if
all Fund Shares have been sold, the net redemption proceeds less any additional
authorized deductions. No interest shall be payable upon any funds held by the
Custodian pending the surrender of the Plan.
If the Planholder fails to surrender the Plan for a period of 60 days after
the sending of the termination notice, the Custodian in its discretion, acting
as agent for the Planholder, may mail to the Planholder a check for all cash
standing to the Planholder's credit and surrender for liquidation such Fund
Shares, if any, held in the Planholder's Plan Account, and the Planholder will
be deemed to have no further rights under the Plan.
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<PAGE>
In the event a check and/or a confirmation statement for Fund Shares cannot
be delivered to the Planholder as described above, the Custodian shall hold the
cash or the Fund Shares in trust subject only to the escheatment laws.
C. PURCHASE, SALE, MAINTENANCE, VOTING AND SUBSTITUTION OF FUND SHARES.
1. PURCHASE AND SALE OF FUND SHARES.
a. Purchases and sales of Fund Shares by the Custodian
pursuant to this Agreement shall be made in accordance with applicable
law, the Prospectus, the Fund's Prospectus and the Sponsor's
Distribution Agreement with the Fund.
b. All purchases of Fund Shares by the Custodian pursuant to
the provisions of this Agreement shall be made from the Fund, or its
issuing agent (or any underwriter of Fund Shares with which the Sponsor
may contract for such purpose) at the net asset value of the Fund next
determined after the time of purchase as calculated by Pioneering
Management Corporation (or any successor thereto) in accordance with
the terms of the Fund's then current Prospectus. The Custodian shall be
entitled to presume conclusively that the price so set with respect to
any Fund Shares purchased by the Custodian is said net asset value.
c. Funds received by the Custodian to be applied to the
purchase of Fund Shares at the net asset value per share determined as
described in Section II(C)(1)(a) shall, unless
28
<PAGE>
impracticable, be applied to such purchase within two business days
after the receipt by the Custodian of said investments payments,
dividends or distributions.
d. All sales of Fund Shares by the Custodian, as agent,
pursuant to the provisions of this Agreement, shall be made by deposit
of the Fund Shares with the Fund or its duly authorized agent together
with a request that the Fund Shares be repurchased at the net asset
value of the Fund next determined after receipt of a proper redemption
request as calculated by Pioneering Management Corporation (or any
successor thereto) in accordance with the terms of the Fund's then
current Prospectus, so long as the privilege of redemption at net asset
value is available to holders of Fund Shares as set forth in the Fund's
then current Prospectus. Whenever, pursuant to the provisions of this
Agreement, Fund Shares are to be sold or redeemed, the Custodian shall
first withdraw the Fund Shares from the custodianship hereunder and, as
agent for the Planholder, shall sell or redeem said Fund Shares by
depositing them for repurchase as set forth above. Anything herein to
the contrary notwithstanding, (i) the Custodian, as agent for the
Planholders, is authorized to offset sales and purchases for all of the
Planholders on a business day and, accordingly, to place with the Fund
or its agent a net purchase order for the excess of purchases over
sales, or a net sale order for the excess of sales over purchases; and
(ii) any such sales of Fund Shares in connection with a Plan
termination, a withdrawal of Fund Shares by a Planholder, or an
exercise of an exchange privilege by a Planholder, shall be effected by
the Custodian in accordance with the terms and conditions of the
applicable Prospectus.
29
<PAGE>
e. Issuance and transfer of Fund Shares will be by book entry
only.
f. The Fund shall make the net asset value per share for Fund
Shares available to the Custodian as soon as reasonably practicable
after the net asset value per share is calculated and shall use its
best efforts to make such net asset value per share available by 7 p.m.
Boston time each Business Day. For the purposes of this section of the
Agreement, "Business Day" shall mean any day on which the Exchange is
open for regular trading and on which the Fund calculates its net asset
value pursuant to the rules of the Securities and Exchange Commission.
g. The Fund shall furnish notice as soon as reasonably
practicable (by wire or telephone, followed by written confirmation) to
the Custodian of any income, dividends, or capital gain distributions
payable on Fund Shares.
Consistent with the foregoing, the Custodian shall enter a gross purchase
and sale order for full and fractional Fund Shares (in two decimal places) at
the net asset value next determined for all Planholder requests to invest in,
transfer or redeem Fund Shares under Pioneer Independence Plans which, pursuant
to the terms and conditions of the Prospectus, the Custodian received in good
order prior to the close of trading on the Exchange, normally 4 p.m. Boston
time. Such orders shall be forwarded to the Fund by 11 a.m. Boston time on the
next following Business Day (such orders will be deemed to have been received by
the Fund as of the close of trading on the Exchange on the day of receipt by the
Custodian of the Planholders' requests). The Custodian shall pay for Fund Shares
on the same Business Day an order to purchase Fund Shares is
30
<PAGE>
transmitted to the Fund. Payment shall be in federal funds transmitted by
wire to the Fund to be received by 11:00 a.m. Boston time of the Business Day
the Fund is notified of the purchase order for Fund Shares. If payment in
federal funds for any purpose is not received or is received by the Fund after
11:00 a.m. Boston time on such Business Day, the Custodian shall promptly, upon
the Fund's request, reimburse the Fund for any charges, costs, fees, interest or
other expenses incurred by the Fund in connection with any advances to, or
borrowings or overdrafts by, the Fund, or any similar expenses incurred by the
Fund, as a result of portfolio transactions effected by the Fund based on such
purchase request. For purposes of this section, upon receipt by the Fund of the
federal funds so wired, such funds cease to be the responsibility of the
Custodian and shall become the responsibility of the Fund.
2. MAINTENANCE. The Custodian shall have possession of and shall segregate
and hold in trust, or shall hold in book share form, where applicable, all
securities and other properties in which the funds of the Planholders are
invested on behalf of the Planholders, all monies held for such Plan
investments, any redemption to the Planholders or other special funds for
payments to the Planholders, and all income and distributions upon, accretions
to and proceeds of such securities and funds, subject only to the deductions
specified in this Agreement or in the Prospectus, until distribution thereof to
the Planholders in accordance with the terms and conditions of the applicable
Prospectus. The Custodian also will effect partial or complete liquidation of
Plans in connection with withdrawals or terminations. The Custodian is
authorized to commingle payments and dividends for all Fund Shares held by it
hereunder and to direct all Fund Shares to be registered in its name or the
names of its nominees. Nothing herein shall be
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<PAGE>
construed to allow the Custodian to commingle the Fund Shares, funds, or
securities with those of any plans other than the Pioneer Independence Plans
specifically covered herein. The Custodian shall maintain a separate record for
each Plan established by a Planholder, showing the number of Fund Shares (to two
decimal places) and the amount of cash, if any, to the credit of each Plan
Account. Such records shall be maintained separate and apart from the
Custodian's corporate records.
All monies deposited with or received by the Custodian hereunder shall be
held by it without interest as part of the custodianship until required to be
disbursed in accordance with the provisions of this Agreement or of Pioneer
Independence Plans.
3. STATEMENTS. The Custodian shall render statements to the Sponsor at such
time and in such form as may be agreed upon by the parties hereto showing, for
each Plan Account in which transactions were effected during the specified
period, the Plan number, the amount and date of the Plan investment(s) received,
the number of such investment(s), the deductions made, the balance applied to
the purchase of Fund Shares for each Plan Account and the number of Fund Shares
purchased.
4. VOTING OF FUND SHARES. The Custodian will provide notice to Planholders
of all Pioneer Independence Fund shareholder meetings, together with proxy
statements. The Custodian shall vote Fund Shares held under any Plan in
accordance with the Planholder's instructions contained in a voting instruction
card provided with the proxy statement or in accordance with the terms of the
applicable Prospectus.
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<PAGE>
5. SUBSTITUTION.
a. BY SPONSOR. The Sponsor may effect substitution of Fund
Shares as provided in Section III(C), below.
b. BY CUSTODIAN. If Fund Shares cannot be purchased by the
Custodian for more than 120 days, and the Sponsor fails to substitute
shares, the Custodian may select another investment medium which it
deems to be comparable to the Fund Shares and, to the extent required,
subject to prior approval of the Securities and Exchange Commission to
the extent required by the 1940 Act. The Custodian shall notify each
Planholder in writing that the substitution will be made if the
Planholder, within 30 days, gives written consent to the Custodian and
agrees to bear his or her reasonable pro-rata share of the Custodian's
related expenses, including tax liability sustained by the Custodian.
The Planholder's failure to give such written consent within the 30 day
period shall give the Custodian authority to terminate the Plan
Account.
If the Fund Shares are not available for purchase for a period
of 120 days or longer, and neither the Sponsor nor the Custodian
substitutes other shares, the Custodian shall have the authority,
without further action on its part, to terminate the Plan.
c. NOTICE. The Custodian or the Sponsor shall, within five
days after any substitution, deliver or mail to each Planholder a
notice of substitution, including an
33
<PAGE>
identification of the Fund Shares eliminated and the securities
substituted, and a specification of the Fund Shares of such Planholders
affected by the substitution.
6. FURNISHING OF INFORMATION. The Custodian shall furnish such records and
other information regarding Pioneer Independence Plans and the custodianship as
the Sponsor may reasonably believe necessary or appropriate for the
administration of the Plans, as provided in Section III below.
D. DUTIES.
1. DUTIES. The Custodian shall:
a. Mail to each Planholder a confirmation of Fund Shares
purchased, stating the purchase price per Fund Share, number of Fund
Shares purchased after applicable deductions, and the total number of
Fund Shares held for the Planholder's Plan Account;
b. Mail to each Planholder a notice of the next investment
due;
c. Upon the instruction of the Sponsor or the Fund, mail to
each Planholder such prospectuses, periodic financial reports, dividend
statements, tax notices and notices of meetings and other proxy
soliciting materials as are required by law or regulation; the cost of
such mailings shall be reimbursed to the Custodian by the Sponsor or
the Fund;
d. Cause periodic audits of the books of the Custodian
relating to the custodianship of Pioneer Independence Plans to be made
at least annually by independent
34
<PAGE>
certified public accountants selected by the Sponsor and reasonably
satisfactory to the Custodian, and more frequently, if required by law
or regulation;
e. Prepare and file such reports and returns as are required
by law or regulation to permit the custodianship to continue in
operation;
f. Answer all inquires from Planholders concerning their
Plans;
g. Furnish to the Internal Revenue Service and to
each Planholder all required returns relating to dividends or other
distributions to such Planholder's Plan Account(s) for federal income
tax reporting purposes; and
h. Any and all duties of the Custodian enumerated in
the foregoing provisions of Section II for which the Custodian assumes
primary responsibility may be delegated by the Custodian to the
Sponsor. Upon the written request of the Sponsor, the Custodian will
delegate any of its functions described in this Section II or in
Section III below, provided that such delegation is consistent with
Sections 26 and 27 of the 1940 Act. In addition, the Custodian may
delegate its duties under this Agreement to its affiliate, Boston
Financial Data Services, Inc. ("BFDS"), a transfer agent registered
under Section 17A(c)(2) of the 1933 Act, provided that such delegation
is not inconsistent with Sections 26 or 27 of the 1940 Act. No other
delegation of the Custodian's duties may be made without the written
agreement of the Sponsor. In the event the Custodian delegates one or
more of its duties hereunder with the consent of the Sponsor or to
BFDS, the Custodian shall remain
35
<PAGE>
responsible for all acts and omissions relative to the performance of
such duties as if any related acts and/or omissions are its own.
E. FEES AND CHARGES.
1. REMUNERATION. As remuneration for the services to be performed by the
Custodian under this Agreement, the Custodian shall receive the fees, charges,
and reimbursements for expenses as listed in the attached Schedule A to this
Agreement and the applicable Prospectus which charges shall be deducted from
Plan investments or Planholders' Plan Accounts, as specified in the applicable
Prospectus, unless the Custodian is otherwise reimbursed by the Sponsor.
In the event of a default by the Sponsor in the performance of any
administrative service relating to the custodianship described in this
Agreement, the Custodian will perform such service for a consideration payable
by or from the account of the Planholders. Such consideration shall not be in
excess of the amount provided for in this Agreement, including Schedules hereto.
Any deductions under the terms of this provision shall be made in accordance
with the terms of Section 26(a)(2) of the 1940 Act and any rules thereunder (or
any successor rules).
2. PAYMENTS TO SPONSOR. No payment to the Sponsor, or to any
affiliated person or agent of the Sponsor, shall be allowed the Custodian as an
expense except for payment to the Sponsor of a delegated duty fee described in
the attached Schedule A.
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<PAGE>
III. SPONSOR'S FUNCTION
A. ADMINISTRATION OF PIONEER INDEPENDENCE PLANS.
1. GENERAL. The Sponsor agrees to perform the functions required of it by
the terms of this Agreement and the applicable Prospectus.
2. OPERATIONS. The Sponsor will use its best efforts to distribute Pioneer
Independence Plans by entering into sales agreements with other registered
broker-dealers, maintain adequate office facilities and management staff and
keep current records.
3. COMPLIANCE. The Sponsor assumes full responsibility for the preparation,
contents and distribution of the Prospectus, for complying with all applicable
requirements of the 1933 Act and of the 1940 Act and for the preparation and
filing of such other reports or documents as are required by law or regulation,
and covenants and agrees to take all action, and not to omit any action,
necessary to carry out such responsibilities. The Custodian is not responsible
for the preparation, contents and distribution of the Fund Prospectus, or for
any related compliance. With respect to any duties for which the Custodian
assumes primary responsibility but which it delegates to the Sponsor, the
Sponsor covenants and agrees that the Sponsor will take or cause its affiliates
to take all action, and not to omit any action, necessary to carry out such
duties, and agrees to furnish to the Custodian, upon request, evidence thereof
satisfactory to the Custodian and its counsel. The Sponsor will use its best
efforts to make Fund Shares available for purchase to the Custodian at net asset
value.
37
<PAGE>
4. INITIAL PAYMENT. Upon the sale of each Plan, the Sponsor will require
each selling broker-dealer, not later than the time for the first Plan
investment for the purchase of Fund Shares, to forward to the Custodian: (i) the
Plan Application and (ii) a check payable to the Custodian representing the
initial Plan investment or copies of forms appropriate for the election of an
automatic investment option authorizing the payment of money by wire, by
Automatic Clearinghouse ("ACH"), by Electronic Funds Transfer ("EFT") or
transfer or in some other form acceptable to the Custodian.
4. CREATION AND SALES CHARGES. The Sponsor receives a Creation and Sales
Charge to compensate it for its services and costs in creating the Plans and
arranging for their administration, for making the Fund Shares available to
Planholders at net asset value and for selling expenses and commissions with
respect to the Pioneer Independence Plans. This charge is deducted from the
first 12 investments under a Plan as set forth in the applicable Prospectus.
5. PLANS IN DEFAULT. Upon receipt from the Custodian of a monthly statement
of Planholders specifying those Plans in current default on Plan investments,
the Sponsor will request that the selling broker-dealer endeavor promptly to
have said Planholders remedy their defaults.
6. PLAN CANCELLATIONS. In the event that the Sponsor receives from the
Custodian a notice of Plan cancellation by a Planholder, and such cancellation
is subject under applicable law and the Prospectus to a refund of a portion of
the Creation and Sales Charges previously imposed under the Plan, the Sponsor
shall transmit funds to the order of the Custodian in an amount equal
38
<PAGE>
to the refundable amount calculated in accordance with applicable law and
the Prospectus. The Custodian shall then refund the appropriate amount to the
Planholder.
B. FURNISHING OF DOCUMENTS, FORMS AND INFORMATION.
1. The Sponsor shall furnish to the Custodian and file to the extent
required by law on behalf of the Custodian:
a. FINANCIAL STATEMENTS. As soon as available, a copy of each
audit report and other financial statements relating to the
custodianship of the Pioneer Independence Plans and sufficient reports
and other documents required to be mailed to Planholders under Section
II.
b. TAX RETURNS. Not less than 20 calendar days prior to the
due date thereof, all federal and state income tax returns, and all
other tax returns, if any, required by law to be filed by the Custodian
with respect to its custodianship hereunder, prepared in form for
execution and filing, together with advice concerning the proper
allocation of expenses and other items among the Planholders. Such tax
returns shall be filed by the Sponsor on behalf of the Custodian.
c. DISTRIBUTION AGREEMENT. Promptly after the execution
thereof, a copy of any amendment to the Distribution Agreement between
the Sponsor and the Fund and a copy of any new or additional agreement
entered into in lieu thereof.
39
<PAGE>
d. PIONEER INDEPENDENCE PLANS MATERIALS. Draft copies of all
literature, prospectuses, printed matter and other material which
contain any references to the Custodian, except material which is
merely circulated among or sent to employees, stockholders or
representatives of the employees, stockholders or representatives of
the Sponsor and correspondence in the ordinary course of business which
refers in accurate terms to the Custodian's functions with respect to
Pioneer Independence Plans. The Sponsor agrees that none of the
documents specified in this clause shall be reproduced in final form or
distributed until a draft of such documents have been provided to the
Custodian. In the event the Custodian has comments on such drafts, the
Custodian shall comment in writing and transmit such comments to the
Sponsor within 48 hours of receipt of the draft material.
e. DISTRIBUTION REPORTS. Not later than the time specified by
Treasury Regulations for advising Planholders of income and capital
gains distributions of regulated investment companies and within such
time requirements as may be specified by the Securities and Exchange
Commission or other regulatory agency, printed forms for reporting
distribution to Planholders for income tax purposes.
C. SUBSTITUTION OF THE UNDERLYING INVESTMENT.
1. PROCEDURE. In the event that the Sponsor substitutes shares of another
investment medium for Fund Shares in accordance with the procedures set forth in
the applicable Prospectus and as required by law, all required notices shall be
prepared by the Sponsor. In connection
40
<PAGE>
with such substitution, the Custodian is authorized to charge against the
Plan Account of a Planholder such Planholder's pro rata share of the expenses
(including tax liability) incurred by the Custodian or the Sponsor, and to pay
to the Custodian or to the Sponsor the amount of such charge attributable to
expenses incurred by the Custodian or the Sponsor, respectively, in connection
with the substitution. The Custodian and the Sponsor shall furnish one another,
and make available to Planholders upon request, a detailed statement itemizing
their respective expenses.
The Sponsor may effect substitution of Fund Shares whenever it deems such
substitution to be in the best interests of the Planholders, subject to the
following:
a. SECURITIES AND EXCHANGE COMMISSION. To the extent required,
the Sponsor shall receive prior approval by the Securities and Exchange
Commission for any substitution under the provisions of Section 26(b)
of the 1940 Act.
b. SHARES. The Sponsor may substitute for Fund Shares then
held and yet to be purchased or both. Substituted shares must be
generally comparable in character and quality to Fund Shares and must
be registered under the 1933 Act. In the event of a substitution of
Fund Shares, the terms "Fund" and "Fund Shares" as used herein shall be
deemed to include the substituted open-end management company and the
substituted shares of such open-end management company.
c. CUSTODIAN. The Sponsor shall satisfy the Custodian that the
substitute shares may be purchased and redeemed on generally favorable
terms and arrange for the Custodian to acquire substitute shares having
an aggregate value at least equal to that of the
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<PAGE>
Fund Shares replaced. In addition, the Sponsor shall provide the
Custodian with a signed certificate stating that any appropriate notice
of the proposed substitution has been given to each Planholder
according to the terms of the Prospectus.
d. PLANHOLDERS. The Sponsor shall notify each Planholder in
writing that, unless the Planholder surrenders the Plan to the
Custodian within 30 days of the date of mailing of such notice, the
Planholder will be deemed to have authorized the substitution and
agreed to bear his or her pro rata share of actual related expenses, if
any.
IV. FUNCTIONS OF SPONSOR AND CUSTODIAN
A. PLANHOLDER INQUIRIES.
The Sponsor and the Custodian will respond promptly to each Planholder
inquiry received by the Sponsor and Custodian, respectively, to the extent that
the Sponsor or Custodian, as applicable, can respond to such inquiry. In the
event that any such inquiry cannot be responded to, the party receiving such
inquiry will refer the inquiry to the other party to this Agreement.
42
<PAGE>
V. MISCELLANEOUS
A. ASSIGNMENT.
This Agreement shall not be assigned by either of the parties hereto
without the prior written consent of the other party.
B. INDEMNIFICATION BY THE SPONSOR.
The Sponsor, its successors and assigns, shall at all times fully indemnify
and hold harmless the Custodian, its successors and assigns, from any and all
liability, claims, demands, actions, suits, cost or expense of any nature as the
same may arise or be made against or be incurred by the Custodian from the
failure of the Sponsor to comply with any law, rule, regulation or order of the
United States, any state or any other jurisdiction, governmental authority, body
or board having jurisdiction, relating to the sale, registration or
qualification of the Plans or any of them, or the securities sold in connection
therewith. The Fund also agrees to indemnify the Custodian for, and to hold it
harmless against, any loss, liability or expense incurred without negligence or
bad faith on the part of the Custodian, arising out of or in connection with the
acceptance hereof or the performance of its duties hereunder, as well as the
costs and expenses of defending against any claim or liability in the premises,
provided that no claim against the Custodian which might be subject to the
foregoing indemnification provisions shall be confessed, settled or compromised
by the Custodian without the Custodian first having given 15 days'
43
<PAGE>
notice in writing to the Sponsor of the material facts, and provided
further that the Sponsor shall have the right upon written demand delivered to
the Custodian within 15 days following the date of such notice to contest or
defend such claim in the name of the Custodian.
C. COMMUNICATIONS.
All communications provided for hereunder shall be in writing sent by first
class mail or delivered to the respective parties as follows:
PIONEER FUNDS DISTRIBUTOR, INC.
Attention: Robert P. Nault, General Counsel
60 State Street
Boston, MA 02109
STATE STREET BANK AND TRUST COMPANY
Attention: President, Boston Financial Data Services, Inc.
225 Franklin Street
Boston, MA 02110
provided that either party may, by written notice duly given in accordance
herewith, specify a different address for the purpose hereof.
E. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original and all of which shall be deemed one and the same
instrument.
44
<PAGE>
F. INSPECTION.
An executed copy of this Agreement and all amendments thereto shall be kept
on file by the Custodian and shall be open to inspection by any Planholder at
any time during the business hours of the Custodian.
G. SCHEDULES.
All references herein to Schedules shall be deemed to refer to Schedule A
attached to this Agreement which is hereby expressly made a part hereof.
H. AMENDMENT.
This Agreement, including but not limited to Schedule A hereto, may be
amended from time to time as mutually agreed by the parties hereto in writing.
Notwithstanding the foregoing, this Agreement shall not be amended in such a
manner as to adversely affect the rights and privileges of any Planholder
without first obtaining the Planholder's written consent.
I. CONSTRUCTION.
This Agreement shall be subject to and construed under the laws of the
Commonwealth of Massachusetts.
45
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
PIONEER FUNDS DISTRIBUTOR, INC.
By: /s/ Robert L. Butler
[Robert L. Butler
President]
(Seal)
Attest:
- ----------------------------
STATE STREET BANK AND TRUST COMPANY
By: /s/ Ronald E. Logue
[Ronald E. Logue
Executive Vice President]
(Seal)
Attest:
g:/funds/custogr8.doc
46
<PAGE>
SCHEDULE A
FEES SCHEUDLE FOR
STATE STREET BANK AND TRUST COMPANY
FOR SERVICES AS PLAN CUSTODIAN
(DATED FEBRUARY 5, 1998)
The following fees and charges will be deducted from the Plans or from
Planholder accounts and paid to the Custodian in accordance with the terms of
the Prospectus. An asterisk (*) denotes fees that the Fund has voluntarily
elected to pay to the Custodian on behalf of the Plans.
GENERAL
Fees are based on an annual per shareholder account charge for account
maintenance plus transaction and out-of-pocket expenses. There is a minimum
charge of $3,500 per month applicable to each fund in the complex. Fees are
billable on a monthly basis at the rate of 1/12 of the annual fee. A charge is
made for an account in the month that an account opens or closes.
ANNUAL ACCOUNT SERVICE FEES
Open Account 12.00/year *
ACTIVITY BASED FEES
New Account Kits $3.00/each *
Telephone Calls $2.50/each *
Correspondence $3.00/each *
PLANHOLDER FEES
IRA Annual Maintenance $10.00/year1
Bounced Checks $5.00/each
Transcripts $5.00/each year researched
Terminations of Incomplete Plans $2.50/each
Inactive Accounts 2 $12.00/year
1 The Custodian will receive $6; The Pioneer Group, Inc. will
receive $4.
2 A Plan that is not current and to which no investments have been
made for a 12-month period.
OUT OF POCKET EXPENSES
Out-of-pocket expenses include, but are not limited to: confirmation
statements, checks, postage, forms, telephone, microfilm, microfiche, year-end
forms and expenses incurred at the specific direction of Pioneer Funds
Distributor, Inc.
PIONEER FUNDS DISTRIBUTOR, INC.
60 State Street
Boston, MA 02109
(617) 742-7825
SALES AGREEMENT FOR
PIONEER INDEPENDENCE PLANS
Gentlemen:
Pioneer Funds Distributor, Inc. ( "PFD" ), acts as sponsor and principal
underwriter, as defined in the Investment Company Act of 1940 (the "1940 Act"),
for Pioneer Independence Plans ("Plan" or "Plans") for the accumulation of
shares of Pioneer Independence Fund (the "Fund"). The Plans and the Fund are
registered investment companies under the 1940 Act. As principal underwriter for
the Fund, PFD offers to sell Fund shares through the Plans subject to the
conditions set forth in this Agreement and subsequent amendments hereto.
1. Fund shares purchased through PFD for sale to the public through the Plans
shall be offered and sold at the price and on the terms and conditions set
forth in the currently effective prospectuses for the Fund and the Plans,
as amended or supplemented from time to time (the "Prospectus" or
"Prospectuses"). In the sale of Fund shares to the public through the
Plans, you shall act as dealer for your own account or as agent for your
customer and in no transaction shall you have any authority to act or hold
yourself out as agent for PFD, the Fund, the Fund's Custodian, the Plan
Custodian, the Fund's transfer agent or any other party, and nothing in
this Agreement, including the use of the word "commissions," shall
constitute you a partner, employee or agent of PFD or give you any
authority to act for PFD. Neither PFD nor the Fund shall be liable for any
or your acts or obligations as a broker-dealer under this Agreement.
2. Fund shares purchased through PFD for sale to the public shall be purchased
only to cover orders previously received by you from your customers who are
establishing or have established Plan accounts. If you purchase Fund shares
from your customers, you agree to pay such customers not less than the
redemption price in effect on the date of purchase, as defined in the
applicable Fund prospectus. Fund shares may not be purchased for your own
account but may be purchased by an employer-sponsored retirement plan
established for the benefit of your employees or affiliates. Fund shares
shall not be reoffered or sold except to the Fund or PFD. PFD agrees to
purchase Fund shares only for investment or to cover orders received.
3. Only unconditional orders for a designated number of Fund shares or dollar
amount of investment shall be accepted. Procedures relating to handling
orders shall be conveyed to you from time to time. All such orders are
subject to acceptance or rejection by PFD in its sole discretion.
<PAGE>
4. In order to assure PFD that you will have sufficient assets to make any
required repayments of commissions required under paragraphs 6, 9, 10 and
11 below, PFD shall initially establish on its books an account in your
name to which shall be credited 10% of the commissions due and payable to
you. PFD shall retain such portion of those commissions as a reserve from
which any claims for refund with respect to Plans sold by you can be paid
in the event you fail to honor any PFD request for such repayment. PFD
shall have the right in its sole discretion to reduce or waive such reserve
requirements on the basis of your refund experience, level of business or
any other circumstances that PFD deems relevant.
5. All applications for the Plans shall be made on application forms approved
or provided by PFD, and all initial investments collected shall be remitted
in full, without deduction of any commission by you, together with such
application forms, signed by each applicant ("Planholder"), to the Plan
Custodian, State Street Bank and Trust Company, by addressing all such
correspondence to Boston Financial Data Services, P.O. Box 8330, Boston,
Massachusetts 02266-8300. Checks or other orders for payment of investments
shall be drawn to the order of State Street Bank and Trust Company. A
separate check or other payment mode shall accompany the application form
submitted for each Plan. After the initial investment has been made and the
Plan has been issued, the Planholder shall make all investments payable to
State Street Bank and Trust Company and send all future investments to the
address stated above, or such other addressee as PFD shall identify to you
in writing.
Promptly upon receipt of payment, Fund shares sold by you under a Plan
shall be deposited by the Custodian to a Plan account on the books of the
Plans registered in accordance with your instructions. Certificates will
not be issued for the Plans or for Fund shares.
6. PFD reserves the right in its sole discretion to reject any Plan
application and return any investment made in connection therewith. PFD
also reserves the right in its sole discretion to give any Planholder the
privilege of canceling a Plan in accordance with any rights described in
the Plans" Prospectus effective at the time of purchase of the Plan. PFD
further reserves the right to refund all or part of any investment or
investments made by any Planholder in the event that it, in its sole
discretion, believes that the solicitation and/or sale associated therewith
was effected in violation of any applicable state or federal law or rule or
regulation of the NASD. In the event of any such refund or refunds, you
shall not be entitled to any commissions thereon, and, if such commissions
have been paid, you shall promptly refund same to PFD or PFD may, at its
option, charge the same against future commissions. To this end, you hereby
grant PFD a lien on any such commissions.
7. On all approved sales of Plans made by you and acceptance of such Plan(s)
by the applicant, you shall earn a commission in accordance with Appendix A
which is attached hereto and made a part of this Agreement. As nearly as
practicable,
<PAGE>
commissions will be paid monthly as the Creation and Sales
Charges (as defined in the Plans' Prospectus) applicable to the Plans are
received by PFD from the Custodian. Commissions will be paid only with
respect to Plan investments actually received; no commissions will be paid
with respect to Plan investments scheduled but not made. Your rights to all
commissions on Plan investments made under Plans sold during the term of
this agreement shall survive the termination of this agreement, provided
you are in compliance with paragraph 16 below. Commission checks for less
than $1 will not be issued.
PFD may, from time to time, offer additional commissions or bonuses on
sales of Fund shares through the Plans made by you or your representatives
without otherwise revising this Agreement. Any such additional commissions
or bonuses shall take effect in accordance with the terms and conditions
contained in a written notification to you.
8. Anything herein to the contrary notwithstanding, Appendix A is subject to
change by PFD at any time and from time to time, but no such changes shall
affect amounts payable to you as commissions on Plans accepted by PFD prior
to any such changes. Any such changes shall be communicated by PFD to you
in writing prior to becoming effective.
9. A notice of cancellation right will be mailed to each Planholder within
sixty (60) days after his first investment under a Plan. In the event a
Planholder exercises his right under Section 27 of the 1940 Act to
surrender his Plan within forty-five (45) days after receiving such notice
and to receive the value of the Fund shares held under his Plan plus a
refund of all Creation and Sales Charges paid under the Plan, you shall
promptly refund to PFD any commissions previously paid to you with respect
to such Plan. PFD may, however, at its option, charge such amount against
future commissions receivable by you. To this end, you hereby grant PFD a
lien on any such commissions.
10. In the event a Planholder exercises his right under Section 27 of the 1940
Act to surrender his Plan within the first eighteen (18) months following
its issuance and to receive the value of the Fund shares held in his Plan
account plus amount equal to that part of the excess paid with respect to
that Plan for Creation and Sales Charges which exceeds 15% of the gross
payments made, you shall promptly refund to PFD a portion of the commission
previously paid to you with respect to such Plan as the amount refunded to
the Planholder bears to the total Creation and Sales Charge paid by him
with respect to such Plan. PFD may however, at its option, charge such
amount against future commissions receivable by you. To this end, you
hereby grant PFD a lien on any such commissions.
11. In the event a Planholder exercises his privilege under the Prospectus to
reduce the face amount of his Plan and to receive a refund of all excess
Creation and Sales Charges paid under the Plan or if a refund of excess
Creation and Sales Charges is
<PAGE>
due a Planholder by operation of Rights of
Accumulation, you shall promptly refund to PFD any commissions previously
paid to you with respect to such Plan. PFD may, however, at its option,
charge such amount against future commissions receivable by you. To this
end, you hereby grant PFD a lien on any such commissions.
12. You will accept Plan applications only from persons who have received a
copy of the Prospectuses, as issued under the Securities Act of 1933, and
who, to the best of your knowledge and belief, can and will complete all
payments specified in the application. If a Planholder becomes delinquent
in his payments, it shall be your responsibility to contact the Planholder
for the purpose of reinstating the payment schedule.
13. Plans shall be offered and sold in such face amounts calling for such
periodic payments as PFD shall from time to time determine and set forth in
the Plan Prospectus. PFD reserves the right, in its sole discretion, to
suspend, alter, or modify in any way the sale of any of the Plans or to
withdraw the offering of the Plans entirely; provided, however, that in the
event any such suspension, restriction, alteration, or modification results
from other than a state or federal regulatory or statutory requirement, no
such change shall be effected prior to your having been notified of such
change by PFD thirty (30) days prior thereto.
14. No person is authorized or permitted to give any information or make any
representations concerning the Plans or the Fund other than those which are
contained in the Prospectuses and in such other printed information
(including the Statement of Additional Information) as may be subsequently
issued by PFD as information supplemental to the Prospectuses or approved
by PFD in writing for use in connection therewith. You will not use the
words "Pioneer Independence Plans," Pioneer Independence Fund," "Pioneer
Funds Distributor, Inc." or any derivatives of such words, whether in
writing, by radio or television, or any other media, without PFD's prior
written approval. In purchasing Plans or Fund shares from PFD, you shall
rely solely on the representations contained in the Plans' Prospectus and
the Fund's Prospectus and Statement of Additional Information.
15. Copies of the Prospectuses, any printed information issued as supplemental
to the Prospectuses and Plan application forms will be supplied by PFD in
reasonable quantities upon request. All other expenses incurred by you in
connection with activities under this Agreement shall be borne by you.
16. You represent that you are and will remain a member in good standing of the
NASD and agree to abide by all of its rules and regulations, including its
Conduct Rules. Reference specifically made to Rule 2830 of the Conduct
Rules which is incorporated herein as if set forth in full. You further
agree to comply with all applicable state and federal laws and with the
rules and regulations of authorized regulatory agencies thereunder having
jurisdiction. You will not offer the Plans for sale unless it is duly
registered under applicable state and federal statues and the rules and
regulations thereunder.
<PAGE>
17. Commissions on the first twelve (12) investments will be paid to you so
long as this Agreement remains in full force and effect or so long
thereafter as you continue membership in the NASD. If you should
voluntarily terminate your membership in the NASD, PFD reserves the right
to assign Plan accounts as to which you are the dealer of record and the
right to receive commissions with respect to such Plan accounts to one of
its other active dealers. Nevertheless, PFD, in its sole discretion, may
pay commissions to you on Plan investments made with respect to such Plan
accounts subsequent to such voluntary termination by you. Notwithstanding
the above, in the event your membership in the NASD is discontinued or
suspended because of disciplinary proceedings by the NASD, the SEC, or
other regulatory bodies, no commissions will be paid on any investment
received during the period of a suspension or after the effective date of
an expulsion or revocation of a membership; provided, however, that in the
event your NASD membership is thereafter reinstated in good standing, or if
such disciplinary action by another regulatory body is thereafter
terminated by same, payment of such commissions to you shall then resume,
if such payment resumption is allowable under applicable law, rules or
organizations.
18. You agree to cooperate as requested with programs that the Fund, PFD or
their affiliates provide to enhance services provided to Planholders
(shareholders who own Fund shares directly or indirectly through the Plans)
and to take an active role in providing such Planholder services, including
but not limited to providing certain information and assistance with
respect to Planholder accounts, responding to Planholder inquiries or
advising us of such inquiries where appropriate.
You agree to assign an active registered representative to each Planholder
account on your and our records and to reassign accounts when registered
representatives leave your firm. You also agree to instruct your
representatives to maintain regular contact with Planholders whose Plan
accounts are assigned to them. With respect to Planholder accounts which
are held in nominee or "street" name, you agree to provide such
documentation and verification that active representatives are assigned to
all such Planholder accounts as PFD may require from time to time.
19. Subject to the terms and conditions set forth in the Fund's prospectus, SAI
and Plan of Distribution under Rule 12b-1 of the 1940 Act, and further
subject to your maintaining satisfactory service to Planholders under
paragraph 18 above (as determined in PFD's sole discretion), you will be
entitled to an annual service fee of up to 0.25% of assets of your clients'
in accounts of the Plans and the Fund, provided such assets have been in
such accounts for a minimum of one year. Service fees will not be paid on
clients' assets resulting from Plan investments subject to Creation and
Sales Charges, even if such payments have been accelerated, until the
assets resulting from each investment have been in the Plan account for one
year. Assets in employer-sponsored retirement plans for the benefit of your
employees or affiliates are not eligible for service fees. Service fees
will normally be paid quarterly.
<PAGE>
Provided that you remain a broker-dealer registered with the SEC and a
member in good standing of the NASD, and further provided that you remain
in compliance with the obligations assumed under paragraph 18, service fees
on your clients' assets in accounts in the Plans or the Fund will continue
to be paid to you following termination of this Agreement and will not be
assigned without your consent. It is understood and agreed, however, that
such payments will only be made if permitted by, and at the rate authorized
by, the Fund's Plan of Distribution, the Fund's Trustees, or any law,
regulation or rule that is applicable.
20. Each party hereto has the right to cancel this Agreement at any time upon
five (5) days' written notice to the other.
21. All communications to PFD shall be sent to the address above or to such
other address as PFD may authorize in writing. All communications and/or
notices to you shall be duly given, mailed or telegraphed to you at the
address specified below, or at such other address as you may authorize in
writing.
22. Failure of either party to terminate this Agreement upon the occurrence of
any event set forth in this Agreement as a cause for termination shall not
constitute a waiver of the right to terminate this Agreement at a later
time on account of such occurrence.
23. PFD agrees to use its best efforts to provide to you such information, and
in such form, regarding Planholder's accounts as you may reasonably
request.
24. This Agreement shall be construed in accordance with the laws of the
Commonwealth of Massachusetts, and no modification hereof shall be valid
unless in writing.
25. PFD reserves the right to amend this Agreement upon thirty (30) days'
notice.
26. This Agreement or any monies due or to become due hereunder shall not be
assignable by you without prior written approval by PFD. Any request for an
assignment shall be on a form approved by PFD, which may be obtained from
PFD at the address shown above.
<PAGE>
27. This Agreement supersedes and cancels all previous agreements pertaining to
the Plans and the Fund between PFD and you, whether oral or written.
PIONEER FUNDS DISTRIBUTOR, INC.
By: ____________________________
William A. Misata, Vice President
Date: ___________________________
The undersigned hereby accepts the offer set forth in above letter.
By: ___________________________
Title: ___________________________
Date: ___________________________
RETAIN ONE COPY AND RETURN THE OTHER
g:\funds\periodic\ipdsa2.doc
<TABLE>
<CAPTION>
PIONEER INDEPENDENCE PLANS
15-YEAR PLAN INVESTMENTS AND DEDUCTIONS
CREATION AND SALES CHARGE
----------------------------------------------------------
PER TO NET
MONTHLY PER INVEST- TOTAL TO INVEST- MONTHLY
PLAN TOTAL INVEST- MENT SALES TOTAL MENT PLAN
INVEST- INVEST- MENT 13 THRU CHARGE INVEST- IN INVEST-
MENT MENT 1 THRU 12 180 (A) MENT SHARES MENT
- ---------- ------------- --------- -------- ------------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 50.00 $ 9,000.00 $ 25.00 $0 $ 300.00 3.33% 3.45% $ 50.00
75.00 13,500.00 37.50 0 450.00 3.33% 3.45% 75.00
100.00 18,000.00 50.00 0 600.00 3.33% 3.45% 100.00
125.00 22,500.00 62.50 0 750.00 3.33% 3.45% 125.00
150.00 27,000.00 75.00 0 900.00 3.33% 3.45% 150.00
166.66 29,998.80 83.33 0 999.96 3.33% 3.45% 166.66
200.00 36,000.00 100.00 0 1,200.00 3.33% 3.45% 200.00
250.00 45,000.00 125.00 0 1,500.00 3.33% 3.45% 250.00
300.00 54,000.00 150.00 0 1,800.00 3.33% 3.45% 300.00
350.00 63,000.00 175.00 0 2,100.00 3.33% 3.45% 350.00
400.00 72,000.00 200.00 0 2,400.00 3.33% 3.45% 400.00
450.00 81,000.00 225.00 0 2,700.00 3.33% 3.45% 450.00
500.00 90,000.00 250.00 0 3,000.00 3.33% 3.45% 500.00
600.00 108,000.00 300.00 0 3,600.00 3.33% 3.45% 600.00
700.00 126,000.00 350.00 0 4,200.00 3.33% 3.45% 700.00
800.00 144,000.00 400.00 0 4,800.00 3.33% 3.45% 800.00
900.00 162,000.00 450.00 0 5,400.00 3.33% 3.45% 900.00
1,000.00 180,000.00 500.00 0 6,000.00 3.33% 3.45% 1,000.00
1,250.00 225,000.00 625.00 0 7,500.00 3.33% 3.45% 1,250.00
1,500.00 270,000.00 675.00 0 8,100.00 3.00% 3.09% 1,500.00
1,750.00 315,000.00 700.00 0 8,400.00 2.67% 2.74% 1,750.00
2,000.00 360,000.00 750.00 0 9,000.00 2.50% 2.56% 2,000.00
2,500.00 450,000.00 812.50 0 9,750.00 2.17% 2.21% 2,500.00
5,000.00 900,000.00 1,250.00 0 15,000.00 1.67% 1.69% 5,000.00
10,000.00 1,800,000.00 1,500.00 0 18,000.00 1.00% 1.01% 10,000.00
</TABLE>
(A) Does not include an annual distribution and service fee paid by Pioneer
Independence Fund of up to 0.25% based on Pioneer Independence Fund's
average daily net assets.
<PAGE>
<TABLE>
<CAPTION>
PIONEER INDEPENDENCE PLANS
TOTAL 25-YEAR PLAN INVESTMENTS AND DEDUCTIONS WHEN
EXTENDED INVESTMENT OPTION IS USED
CREATION AND SALES CHARGE
-------------------------------------------------------
PER TO NET
MONTHLY PER INVEST- TOTAL TO INVEST- MONTHLY
PLAN TOTAL INVEST- MENT SALES TOTAL MENT PLAN
INVEST- INVEST- MENT 13 THRU CHARGE INVEST- IN INVEST-
MENT MENT 1 THRU 12 300 (A) MENT SHARES MENT
- ---------- ------------- --------- -------- ---------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 50.00 $ 15,000.00 $ 25.00 $0 $ 300.00 2.00% 2.04% $ 50.00
75.00 22,500.00 37.50 0 450.00 2.00% 2.04% 75.00
100.00 30,000.00 50.00 0 600.00 2.00% 2.04% 100.00
125.00 37,500.00 62.50 0 750.00 2.00% 2.04% 125.00
150.00 45,000.00 75.00 0 900.00 2.00% 2.04% 150.00
166.66 49,998.00 83.33 0 999.96 2.00% 2.04% 166.66
200.00 60,000.00 100.00 0 1,200.00 2.00% 2.04% 200.00
250.00 75,000.00 125.00 0 1,500.00 2.00% 2.04% 250.00
300.00 90,000.00 150.00 0 1,800.00 2.00% 2.04% 300.00
350.00 105,000.00 175.00 0 2,100.00 2.00% 2.04% 350.00
400.00 120,000.00 200.00 0 2,400.00 2.00% 2.04% 400.00
450.00 135,000.00 225.00 0 2,700.00 2.00% 2.04% 450.00
500.00 150,000.00 250.00 0 3,000.00 2.00% 2.04% 500.00
600.00 180,000.00 300.00 0 3,600.00 2.00% 2.04% 600.00
700.00 210,000.00 350.00 0 4,200.00 2.00% 2.04% 700.00
800.00 240,000.00 400.00 0 4,800.00 2.00% 2.04% 800.00
900.00 270,000.00 450.00 0 5,400.00 2.00% 2.04% 900.00
1,000.00 300,000.00 500.00 0 6,000.00 2.00% 2.04% 1,000.00
1,250.00 375,000.00 625.00 0 7,500.00 2.00% 2.04% 1,250.00
1,500.00 450,000.00 675.00 0 8,100.00 1.80% 1.83% 1,500.00
1,750.00 525,000.00 700.00 0 8,400.00 1.60% 1.63% 1,750.00
2,000.00 600,000.00 750.00 0 9,000.00 1.50% 1.52% 2,000.00
2,500.00 750,000.00 812.50 0 9,750.00 1.30% 1.32% 2,500.00
5,000.00 1,500,000.00 1,250.00 0 15,000.00 1.00% 1.01% 5,000.00
10,000.00 3,000,000.00 1,500,00 0 18,000.00 0.60% 0.60% 10,000.00
</TABLE>
(A) Does not include an annual distribution and service fee paid by Pioneer
Independence Fund of up to 0.25% based on Pioneer Independence Fund's
average daily net assets.
R E G I S T R A T I O N - Please Print or Type [landscape oriented
along left margin]
[Pioneer logo] Independence Plans
PIONEER Application
- --------------------------------------------------------------------------------
/ Special pricing applicable? [] Yes [] No
/
/ Special Pricing Breakpoint (Dealer Use)
/ [____________________________]
/
New Account Number __________ / List all associated account numbers and
/ monthly amounts.
Monthly Unit $__________ /
/ _________________________ $__________
Total Plan Amount $__________ / _________________________ $__________
/ _________________________ $__________
Initial Investment $__________ / _________________________ $__________
- --------------------------------------------------------------------------------
/REGISTER THIS PLAN AS FOLLOWS:
/
Individual /_________________________________________ ____-____-____
/First Name Middle Initial Last Name Social Security Number
Joint Tenants / (If joint tenants, use
with Right of /_________________________________________ Social Security Number
Survivorship /First Name Middle Initial Last Name of the first joint
/ tenant listed.)
Uniform /_________________________________________
Gifts/ /Custodian's Name
Transfers /
to Minors /_________________________________________ ____-____-____
/Minor's Name (only one permitted) Social Security Number
/ of Minor
/under the _____ [] Uniform [] Uniform
/ State Gifts to Transfers to ____/____/____
/ Minors Act Minors Act Birthdate of Minor
- --------------------------------------------------------------------------------
Corporations, /_______________________________________ ____-_________
Trusts, or /Name of Corporation or Trustee(s) Taxpayer
other / Identification Number
Fiduciaries /_______________________________________ ____/____/____
/Name of Trust Date of Trust
- --------------------------------------------------------------------------------
Address /__________________________ ______________ _________ ________
& /Street or P.O. Box City State ZIP
Citizenship /
/____-____-____ Citizen of U.S. [] Yes []No ___________________
/Telephone If no, citizen of
- --------------------------------------------------------------------------------
TELEPHONE WITHDRAWAL FEATURE--Unless indicated below, I authorize BFDS to accept
instructions from any person to redeem up to 90% of the share value of my
account(s) by telephone, in accordance with the procedures and conditions set
forth in the Pioneer Independence Plans current prospectus.
[] I DO NOT want the Telephone Redemption Privilege.
Redemptions by telephone must be for an amount up to and including $100,000
and will be sent by check via U.S. mail to the address of record.
The Plans, the Fund, Pioneering Services Corporation and BFDS and their
affiliated companies, directors, trustees and employees will not be liable for
any loss, expense, or cost arising out of any telephone redemption request
effected in accordance with the authorization(s) set forth in this application
if they reasonably believe such request to be genuine, but may in certain cases
be liable for losses due to unauthorized or fradulent transactions. Procedures
for verification of telephone transactions may include recordings of telephone
transactions and requests for conformation of the shareholder's Social Security
Number and current address. Mailings of confirmations occur promptly after the
transaction.
- --------------------------------------------------------------------------------
The undersigned warrant(s) that I (we) have full authority and, if a natural
person, I (we) am (are) of legal age to purchase shares pursuant to this
application, and have received a current prospectuses for the Plans and the
Fund.
- --------------------------------------------------------------------------------
WITHHOLDING INFORMATION (Substitute Form W-9)
UNDER THE INTEREST AND DIVIDEND TAX COMPLIANCE ACT OF 1983, WE ARE REQUIRED TO
HAVE THE FOLLOWING CERTIFICATION: UNDER THE PENALTIES OF PERJURY, I CERTIFY
THAT:
(1) The number shown above is my correct taxpayer identification number
(or I am waiting for a number to be issued to me), and
(2) I am not subject to backup withholding because (a) I am exempt from
backup withholding, or (b) I have not been notified by the Internal
Revenue Service that I am subject to backup withholding as a result
of a failure to report all interest or dividends, or (c) the IRS has
notified me that I am no longer subject to backup withholding.
You must cross out item 2 above if you have been notified by the IRS that you
are currently subject to backup withholding because of underreporting interest
or dividends on your tax return. For real estate transactions, item 2 does not
apply. For mortgage interest paid, the acquisition or abandonment of secured
property, contributions to an individual retirement arrangement (IRA), and
generally payments other than interest and dividends, you are not required to
sign the certification, but you must provide your correct taxpayer
identification number.
- --------------------------------------------------------------------------------
SIGNATURE PROVISIONS
I/We, the undersigned Depositor(s), have read and understand the foregoing
application and the attached material included herein by reference. In addition,
I/We certify that the information I/we have provided, the information included
within the application, and the attached material included herein by reference
is accurate including but not limited to the representations contained in the
Withholding Information section of this application above. [The Internal Revenue
Service does not require your consent to any provision of this document other
than the certifications required to avoid backup withholding.]
Signature of Owner* X ___________________________________ Date ________________
Signature of Joint Owner X ______________________________ Date ________________
*If a corporate or trust account, authorized signer should indicate title (e.g.,
President, Treasurer, or Trustee).
- --------------------------------------------------------------------------------
A Bank Draft Authoriza- / MAIL APPLICATION United Services Planning
tion is attached [] Yes [] No / AND INITIAL Association, Inc.
/ INVESTMENT TO: P.O. Box XXXX
Check box for / Fort Worth, Texas 76113
Government Allotment [] /
/
MAKE ALL CHECKS /
PAYABLE TO: State Street Bank/
and Trust Company/
- --------------------------------------------------------------------------------
Dealer Name ________________________ Authorized Signature X ____________________
Branch Office (Location) _______________________________________________________
Representative _________________________________________________________________
Name Number
Representative's Signature X ______________________________________
7XX (12/97)
[copyright symbol] 1997 United Services Planning Association, Inc. 12057
<PAGE>
P l e a s e P r i n t o r T y p e [landscape oriented
along left margin]
[Pioneer logo] Independence Plans
PIONEER IRA Application
- --------------------------------------------------------------------------------
/ Special pricing applicable? [] Yes [] No
/
/ Special Pricing Breakpoint (Dealer Use)
/ [____________________________]
/
New Account Number __________ / List all associated account numbers and
/ monthly amounts.
Monthly Unit $__________ /
/ _________________________ $__________
Total Plan Amount $__________ / _________________________ $__________
/ _________________________ $__________
Initial Investment $__________ / _________________________ $__________
- --------------------------------------------------------------------------------
Account /REGISTER THIS PLAN AS FOLLOWS:
Registration /
/_________________________________________ ____-____-____
/First Name Middle Initial Last Name Social Security Number
/
/_________________________________________ ______________
/Address Date of Birth
/
/_________________________________________
/City State ZIP
- --------------------------------------------------------------------------------
Type of /[] Traditional [] Roth Contributory [] Roth Conversion
/ [] Rollover [] SEP []SARSEP
- --------------------------------------------------------------------------------
Initial / AMOUNT
Investment /[] Contribution for tax year 19__ $________________
/[] Direct transfer from another IRA
/ (attach completed IRA Transfer/
/ Conversion Form) $________________
/[] Rollover from another IRA $________________
/[] Rollover from an employer-sponsored
/ retirement plan or 403(b) plan $________________
- --------------------------------------------------------------------------------
SEP /This is a SEP or SARSEP contribution
Instructions /on my behalf from:
/
/__________________________________________ ___________________
/Name of Employer Contact Person
/
/__________________________________________ ___________________
/Address of Employer Telephone Number
- --------------------------------------------------------------------------------
Your /PRIMARY BENEFICIARIES: Upon my death, pay the PERCENTAGES
Beneficiary /value of my IRA to: MUST TOTAL
/ 100%
If you have /_____________________ ____________ ________________
additional /Name Birthdate Social Security
beneficiaries,/ (mo/day/yr) Number
attach a sep- /
arate sheet /__________________________________ ________________ ____________%
and include /Address Relationship Share
all informa- /
tion requested/_____________________ ____________ ________________
here. Please /Name Birthdate Social Security
sign and date / (mo/day/yr) Number
any sheets you/
attach. /__________________________________ ________________ ____________%
/Address Relationship Share
If you are not/
survived by /SECONDARY BENEFICIARIES: If no beneficiary survives
any designated/me (or if I have checked option 2 below and no
beneficiary, /primary beneficiary or heirs survive me), pay the PERCENTAGES
your benefici-/value of my IRA to: MUST TOTAL
ary will be / 100%
your estate. /_____________________ ____________ ________________
/Name Birthdate Social Security
/ (mo/day/yr) Number
/
/__________________________________ ________________ ____________%
/Address Relationship Share
/
/_____________________ ____________ ________________
/Name Birthdate Social Security
/ (mo/day/yr) Number
/
/__________________________________ ________________ ____________%
/Address Relationship Share
/
/CHECK ONE: If any primary (or secondary) beneficiary dies before
/me, pay that person's share to:
/
If neither box/1. [] the other primary ( or secondary ) beneficiaries in
is checked, / proportion to the shares indicated (per capita), or
option 1 /2. [] the heirs at law of the deceased beneficiary in shares
will apply. / determined by right of representation (per stirpes).
- --------------------------------------------------------------------------------
I hereby adopt the Pioneer Independence Plans Individual Retirement Account
appointing The Pioneer Group, Inc. as custodian. I certify that: (1) I have
received and read the current prospectus of Pioneer Independence Plans including
the prospectus of Pioneer Independence Fund, and have read and understand the
IRA custodial agreement and disclosure statement and consent to the custodial
fees as specified herein; (2) any contribution designated as a rollover
qualifies for rollover treatment and constitutes an irrevocable election to have
such amount treated as a rollover contribution for federal income tax purposes;
(3) under penalties of perjury, my social security number shown on this
application is correct; and (4) I must specify whether federal income tax is to
be withheld from any distribution I request from this account - otherwise my
request will not be in good order. I further understand that the $10.00 annual
IRA fee is paid by redemption of Pioneer Independence Fund shares unless paid
separately. The undersigned warrants that I have full authority and, if a
natural person, I am of legal age to purchase shares pursuant to this
application.
- --------------------------------------------------------------------------------
SIGNATURE PROVISIONS
I, the undersigned Depositor, have read and understand the foregoing
application and the attached material included herein by reference. In addition,
I certify that the information which I have provided and the information which
is included within the application and the attached material included herein by
reference is accurate.
Dated __________, 19__ At ______________________________________________________
City State ZIP
Signature of Shareholder X _____________________________________________________
- --------------------------------------------------------------------------------
A Bank Draft Authoriza- / MAIL APPLICATION United Services Planning
tion is attached [] Yes [] No / AND INITIAL Association, Inc.
/ INVESTMENT TO: P.O. Box XXXX
Check box for / Fort Worth, Texas 76113
Government Allotment [] /
/
MAKE ALL CHECKS /
PAYABLE TO: [State Street Bank/
and Trust Company]/
- --------------------------------------------------------------------------------
Dealer Name ________________________ Authorized Signature X ____________________
Branch Office (Location) _______________________________________________________
Representative _________________________________________________________________
Name Number
Representative's Signature X ______________________________________
7XX (1/98)
[copyright symbol] 1997 United Services Planning Association, Inc. 01196
ARTHUR ANDERSEN LLP
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the use of our report
dated February 24, 1998 (and to all references to our firm) included in or
made a part of Pioneer Independence Plans' Pre-effective Amendment No. 1
to Registration Statement File No. 333-42113.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
Boston, Massachusetts
March 11, 1998
<PAGE>
ARTHUR ANDERSEN LLP
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the use of our report
for Pioneer Funds Distributor, Inc. dated February 3, 1998 (and to all
references to our firm) included in or made a part of Pioneer Independence
Plans' Pre-Effective Amendment No. 1 to Registration Statement No. 333-42113.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
March 11, 1998
Massachusetts
<TABLE>
<CAPTION>
LAW OFFICER OF
<S> <C> <C>
30 ROCKEFELLER PLAZA TEN POST OFFICE SQUARE o SOUTH
NEW YORK, NY 10112 DECHERT PRICE & RHOADS BOSTON, MA 02109-4603
(212) 698-3500 (617) 728-7100
1775 EYE STREET, N.W.
4000 BELL ATLANTIC TOWER WASHINGTON, DC 20006-2401 90 STATE HOUSE SQUARE
1717 ARCH STREET HARTFORD, CT 06103-3702
PHILADELPHIA, PA 19103-2793 (860) 524-3999
TELEPHONE: (202) 261-3300
THIRTY NORTH THIRD STREET FAX: (202) 261-3333 65 AVENUE LOUISE
HARRISBURG, PA 17101-1603 1050 BRUSSELS, BELGIUM
(717) 237-2000 (32-2) 535-5411
PRINCETON PIKE CORPORATE CENTER TITMUSS SAINER DECHERT
P.O. BOX 5218 2 SERJEANTS' INN
PRINCETON, NJ 08543-5218 LONDON EC4Y 1LT, ENGLAND
(609) 520-3200 (44-171) 583-5353
151, BOULEVARD HAUSSMANN
75008 PARIS, FRANCE
(33-1) 53 83 84 70
</TABLE>
March 12, 1998
Pioneer Funds Distributor, Inc.
60 State Street
Boston, Massachusetts 02109-1820
Re: Pioneer Independence Plans
(File No. 333-42113)
--------------------------
Gentlemen:
Pioneer Funds Distributor, Inc. ("PFD"), a Massachusetts corporation, has
filed with the Securities and Exchange Commission under the Investment Company
Act of 1940 a Registration Statement on Form N-8B-2 (File No. 811-08551)
registering Pioneer Independence Plans as a unit investment trust of which PFD
is the principal underwriter and sponsor. PFD has also filed with the Securities
and Exchange Commission under the Securities Act of 1933 a Registration
Statement on Form S-6, as amended (File No. 333-42113), also covering the
registration of Pioneer Independence Plans.
We have examined the Registration Statements for Pioneer Independence Plans
and have also examined the custodian agreement, dated February 17, 1998 (the
"Custodian Agreement") between PFD and State Street Bank and Trust Company (the
"Custodian") under the terms of which Pioneer Independence Plans are issued.
Based on the foregoing, it is our opinion that PFD has duly entered into
the Custodian Agreement with the Custodian and that the Custodian Agreement is a
valid and binding agreement of PFD. It is also our opinion that the Pioneer
Independence Plans, when issued in the manner contemplated by the Custodian
Agreement and the Registration Statements, will constitute legal, valid and
binding obligations on the part of PFD.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement on Form S-6 of Pioneer Independence Plans and to all
references to our firm therein.
Sincerely,
/s/ Dechert Price & Rhoads
Dechert Price & Rhoads
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL DATA EXTRACTED FROM THE AUDITED BALANCE
SHEET DATED FEBRUARY 20, 1998 OF PIONEER INDEPENDENCE PLANS AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH BALANCE SHEET.
</LEGEND>
<CIK> 0001051008
<NAME> PIONEER INDEPENDENCE PLANS
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> FEB-20-1998
<INVESTMENTS-AT-COST> 100
<INVESTMENTS-AT-VALUE> 100
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 100
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 0
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 100
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 10
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 10.00
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
