January 26, 1998
PIONEER GROWTH SHARES
SUPPLEMENT TO PROSPECTUS DATED APRIL 30, 1997
The Trustees of Pioneer Growth Shares (the "Fund") have approved
certain changes to the Fund's operations, including a new management contract
with a performance based management fee. These changes have been submitted for
shareholder approval at a meeting scheduled to be held in April, 1998. If
approved by shareholders, the changes will take effect on May 1, 1998.
INVESTMENT POLICIES
Changes in the Fund's policies relating to a number of the fundamental
investment restrictions set forth in the Fund's statement of additional
information have also been proposed. However, none of these changes are expected
to have a material effect on the Fund's current investment operations.
EXPENSE INFORMATION
As more fully described below, the Fund has submitted for shareholder
approval a proposed management contract under which the basic rate of management
fee payable to Pioneering Management Corporation ("PMC") would be increased or
decreased based upon the Fund's investment performance relative to the record of
a benchmark securities index. Under the proposed contract, the "Annual Operating
Expenses" and the "Example" shown on page 2 of the prospectus would change as
set forth below. The "Shareholder Transaction Expenses" shown on page 2 of the
prospectus would not change as a result of the new contract.
The information in the table below is based on the Fund's actual
expenses for the year ended December 31, 1996. Management fees have been
restated to reflect the basic, maximum and minimum fees payable under the
proposed contract. For the fiscal year ended December 31, 1996, actual
management fees for each Class of shares were 0.50% and total operating expenses
were 1.13% for Class A shares, 1.84% for Class B shares and 1.87% for Class C
shares, under the management contract currently in effect. Had the proposed
contract been in effect throughout this period management fees and total
operating expenses would have been the same as shown under the basic fee column
below.
ANNUAL FUND OPERATING EXPENSES (As a Percentage of Average Net Assets):
<TABLE>
<CAPTION>
CLASS A SHARES Management Fee
<S> <C> <C> <C>
Basic Maximum Minimum
Management Fee 0.70% 0.80% 0.60%
12b-1 Fees 0.25% 0.25% 0.25%
Other Expenses (including accounting and transfer
agent fees, custodian fees and printing expenses) 0.38% 0.38% 0.38%
---- ---- ----
Total Operating Expenses 1.33% 1.43% 1.23%
==== ==== ====
CLASS B SHARES Management Fee
Basic Maximum Minimum
Management Fee 0.70% 0.80% 0.60%
12b-1 Fees 1.00% 1.00% 1.00%
Other Expenses (including accounting and transfer
agent fees, custodian fees and printing expenses) 0.34% 0.34% 0.34%
---- --- ----
Total Operating Expenses 2.04% 2.14% 1.94%
==== ==== ====
CLASS C SHARES Management Fee
Basic Maximum Minimum
Management Fee 0.70% 0.80% 0.60%
12b-1 Fees 1.00% 1.00% 1.00%
Other Expenses (including accounting and transfer
agent fees, custodian fees and printing expenses 0.37% 0.37% 0.37%
---- ---- ----
Total Operating Expenses 2.07% 2.17% 1.97%
==== ==== ====
</TABLE>
EXAMPLE:
You would pay the following fees and expenses on a $1,000 investment,
assuming a 5% annual return, reinvestment of all dividends and distributions and
that the percentage amounts listed above under "Annual Operating Expenses"
remain the same each year.
<TABLE>
<S> <C> <C> <C> <C>
CLASS A SHARES
Management Fee 1 Year 3 Years 5 Years 10 Years
Basic $70 $97 $126 $208
Maximum $71 $100 $131 $219
Minimum $69 $94 $121 $198
CLASS B SHARES*
Management Fee 1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Basic
Assuming complete redemption at end of period $61 $94 $130 $219
Assuming no redemption $21 $64 $110 $219
Maximum
Assuming complete redemption at end of period $62 $97 $135 $230
Assuming no redemption $22 $67 $115 $230
Minimum
Assuming complete redemption at end of period $60 $91 $125 $208
Assuming no redemption $20 $61 $105 $208
CLASS C SHARES**
Management Fee 1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
Basic
Assuming complete redemption at end of period $31 $65 $111 $240
Assuming no redemption $21 $65 $111 $240
Maximum
Assuming complete redemption at end of period $32 $68 $116 $250
Assuming no redemption $22 $68 $116 $250
Minimum
Assuming complete redemption at end of period $30 $62 $106 $230
Assuming no redemption $20 $62 $106 $230
</TABLE>
- -------------------
* Class B shares convert to Class A shares eight years after purchase;
therefore, Class A expenses are used after year eight.
**Class C shares redeemed during the first year after purchase are
subject to a 1% CDSC.
THE EXAMPLE IS DESIGNED FOR INFORMATION PURPOSES ONLY, AND SHOULD NOT
BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES OR RETURNS. ACTUAL
FUND EXPENSES AND RETURN WILL VARY FROM YEAR TO YEAR AND MAY BE HIGHER OR LOWER
THAN THOSE SHOWN.
MANAGEMENT FEE
Under the proposed management contract, as compensation for its
management related services and certain expenses which PMC incurs on behalf of
the Fund, the Fund would pay PMC a management fee that is comprised of two
components. The first component is a basic fee (the "Basic Fee") equal to 0.70%
per annum of the Fund's average daily net assets up to $1 billion, 0.675% of the
next $4 billion, 0.65% of the next $5 billion and 0.575% of the excess over $10
billion. The Basic Fee would be computed daily and paid monthly. The second
component is a performance fee adjustment.
COMPUTING THE PERFORMANCE FEE ADJUSTMENT
The Basic Fee is subject to an upward or downward adjustment, depending
on whether, and to what extent, the investment performance of the Class A shares
of the Fund for the performance period exceeds, or is exceeded by, the record of
the Lipper Growth Funds Index (the "Index") over the same period. This
performance comparison would be made at the end of each month. Each percentage
point of difference (up to a maximum of +/- 0.10 percentage points) would be
multiplied by a performance adjustment rate of 0.01%. An appropriate percentage
of this rate (based on the number of days in the current month) would then be
applied to the Fund's average net assets over the entire performance period,
giving the dollar amount that will be added to (or subtracted from) the Basic
Fee. The monthly performance adjustment will be further adjusted to the extent
necessary to insure that the total annual adjustment to the Basic Fee does not
exceed +/-0.10% of the average daily net assets for that year.
Because the adjustment to the Basic Fee is based on the
comparative performance of the Fund's Class A shares and the record of the
Index, the controlling factor is not whether the performance of the Fund's Class
A shares is up or down, but whether it is up or down more or less than the
record of the Index. Moreover, the comparative investment performance of the
Fund's Class A shares is based solely on the relevant performance period without
regard to the cumulative performance over a longer or shorter period of time.
From time to time, the Trustees may determine that another securities
index is a more appropriate benchmark than the Index for purposes of evaluating
the performance of the Fund. In such event, a successor index may be substituted
for the Index in prospectively calculating the performance based adjustment to
the Base Fee. However, the Fund's performance relative to the Index will still
be used in calculating the performance adjustment concerning portions of the
performance period prior to the approval of the successor index.
PHASE-IN OF PERFORMANCE FEE ARRANGEMENTS
As indicated above, if approved by shareholders, the proposed contract
with PMC will become effective May 1, 1998 (the "Effective Date"). Accordingly,
beginning in May 1998, the Fund will begin paying management fees at a rate
equal to the Basic Fee. The performance adjustment will be phased-in as follows:
(a) during the initial 12-month period, the Basic Fee will remain unadjusted,
(b) during the following 24 months, the Fund's performance will be measured over
an increasing period covering the current month and the prior months dating back
to the Effective Date, (c) beginning in the thirty-sixth month, the duration of
the Fund's performance period will become fixed and (d) thereafter, the Fund's
performance would be measured over a rolling thirty-six month period covering
the current month and the prior thirty-five months (each a "Performance
Period"). The Fund will pay management fees at a rate equal to the Basic Fee
plus or minus the amount of the performance adjustment for the relevant
Performance Period.
The Basic Fee is computed daily, the performance fee adjustment is calculated
once per month and the entire management fee is paid monthly.
0198-4877
(C) Pioneer Funds Distributor, Inc.
