April 3, 1995
SUPPLEMENT
to the prospectuses for:
Pioneer II January 27, 1995
Pioneer Three January 27, 1995
Pioneer Capital Growth Fund February 24, 1995
Pioneer Equity-Income Fund February 24, 1995
Pioneer Gold Shares February 24, 1995
Pioneer Europe Fund February 28, 1995
Pioneer Bond Fund October 28, 1994
Pioneer California Double Tax-Free Fund January 27, 1995
Pioneer Massachusetts Double Tax-Free Fund January 27, 1995
Pioneer New York Triple Tax-Free Fund January 27, 1995
How to Buy Fund Shares
In addition to the exceptions listed in each Fund's prospectus, Class A shares
of a Fund may be sold at net asset value per share without a sales charge to
Optional Retirement Program participants if (i) the employer has authorized a
limited number of investment company providers for the Program, (ii) all
authorized investment company providers offer their shares to Program
participants at net asset value, (iii) the employer has agreed in writing to
actively promote the authorized investment company providers to Program
participants and (iv) the Program provides for a matching contribution for each
participant contribution.
0495-2419
(c) Pioneer Funds Distributor, Inc.
<PAGE>
[Pioneer logo}
Pioneer
Three
Prospectus
January 27, 1995
The investment objectives of Pioneer Three (the "Fund") are reasonable income
and growth of capital. The Fund seeks these objectives by investing in a
broad list of carefully selected, reasonably priced securities rather than in
securities whose prices reflect a premium resulting from their current market
popularity. Pioneer Three's investments are focused on small and medium-sized
companies; therefore, securities purchased will generally be limited to those
issued by companies with market capitalizations not exceeding $750 million.
Fund returns and share prices fluctuate and the value of your account 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. Investments in the securities of small and medium-sized
companies may be subject to greater short-term price fluctuations than
investments in the securities of large companies. The Fund is intended for
investors who can accept the risks associated with its investments and may
not be suitable for all investors. See "Investment Objectives and Policies"
for a discussion of these risks.
This Prospectus (Part A of the Registration Statement) provides the
information about the Fund you should know before investing in the Fund.
Please read and retain it for your future reference. More information about
the Fund is included in Part B, the Statement of Additional Information, also
dated January 27, 1995, which is incorporated into this Prospectus by
reference. A copy of the Statement of Additional Information and the Fund's
most recent Annual Report may be obtained free of charge by calling
Shareholder Services at 1-800-225-6292 or by written request to the Fund at
60 State Street, Boston, Massachusetts 02109.
TABLE OF CONTENTS PAGE
I. EXPENSE INFORMATION 2
II. FINANCIAL HIGHLIGHTS 3
III. INVESTMENT OBJECTIVES AND POLICIES 4
IV. MANAGEMENT OF THE FUND 4
V. DISTRIBUTION PLAN 5
VI. INFORMATION ABOUT FUND SHARES 6
How to Purchase Shares 6
Net Asset Value and Pricing of Orders 7
Dividends, Distributions and Taxation 7
Redemptions and Repurchases 8
Redemption of Small Accounts 9
Description of Shares and Voting Rights 9
VII. SHAREHOLDER SERVICES 9
Account and Confirmation Statements 10
Additional Investments 10
Automatic Investment Plans 10
Financial Reports and Tax Information 10
Distribution Options 10
Directed Dividends 10
Direct Deposit 10
Voluntary Tax Withholding 10
Exchange Privilege 10
Telephone Transactions and Related Liabilities 11
Telecommunications Device for the Deaf 11
Retirement Plans 11
Systematic Withdrawal Plans 11
Reinstatement Privilege 11
VIII. INVESTMENT RESULTS 12
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
I. EXPENSE INFORMATION
This table is designed to help you understand the charges and expenses that
you, as a shareholder, will bear directly or indirectly when you invest in
the Fund. The information in the table below is an estimate based on actual
expenses for the year ended September 30, 1994, expressed as a percentage of
the average net assets of the Fund.
Shareholder Transaction Expenses:
Maximum Sales Charge on Purchases(1) 5.75%
Maximum Sales Charge on Reinvestment of Dividends none
Deferred Sales Charge(1) none
Redemption Fee(2) none
Exchange Fee none
Annual Operating Expenses (as a percentage of average net assets):
Management Fee 0.46%
12b-1 Fees 0.18%
Other Expenses (including shareholder accounting and transfer
agent fees, custodian fees and printing expenses) 0.22%
Total Operating Expenses: 0.86%
(1) Purchases of $1,000,000 or more and certain purchases by participants in
a "Group Plan" (as described under "How to Purchase Shares") are not subject
to an initial sales charge. A contingent deferred sales charge of 1% may,
however, be charged on redemptions by such accounts of shares held less than
one year, as further described under "Redemptions and Repurchases".
(2) Separate fees (currently $10 and $20, respectively) apply to domestic and
international bank wire transfers of redemption proceeds.
Example:
You would pay the following expenses on a $1,000 investment assuming a 5%
annual return and redemption at the end of each time period:
One Year Three Years Five Years Ten Years
$66 $83* $102* $157*
*These are cumulative totals; the average fees and expenses paid over a
10-year period would be approximately $15.70 per year.
The example above assumes reinvestment of all dividends and distributions and
that the percentage amounts listed under "Annual Operating Expenses" remain
the same each year.
The example is designed for information purposes only, and should not be
considered a representation of past or future expenses or return. Actual Fund
expenses and return vary from year to year and may be higher or lower than
those shown.
For further information regarding management fees, 12b-1 fees and other
expenses of the Fund, including information regarding the basis upon which
management fees and 12b-1 fees are paid, see "Management of the Fund,"
"Distribution Plan" and "How To Purchase Shares" in this Prospectus and
"Management of the Fund" and "Underwriting Agreement and Distribution Plan"
in the Statement of Additional Information. The Fund's payment of a Rule
12b-1 fee may result in long-term shareholders indirectly paying more than
the economic equivalent of the maximum sales charge permitted under the
National Association of Securities Dealers, Inc. ("NASD") Rules of Fair
Practice.
The maximum sales charge is reduced on purchases of specified amounts and the
value of shares owned in other Pioneer mutual funds is taken into account in
determining the applicable sales charge. See "How to Purchase Shares." No
sales charge is applied to exchanges of shares of the Fund for shares of
other publicly available mutual funds in the Pioneer complex. See "Exchange
Privilege."
<PAGE>
II. FINANCIAL HIGHLIGHTS
The following information has been derived from financial statements which
have been audited by Arthur Andersen LLP, independent public accountants, in
connection with their examination of the Fund's financial statements. Arthur
Andersen LLP's report on the Fund's financial statements as of September 30,
1994 appears in the Fund's Annual Report which is incorporated by reference
in the Statement of Additional Information. The Annual Report includes more
information about the Fund's performance and is available free of charge by
calling Shareholder Services at 1-800-225-6292.
Pioneer Three
Financial Highlights For A Share Outstanding Throughout Each Period
<TABLE>
<CAPTION>
For the Year Ended September 30,
1994 1993 1992 1991 1990 1989 1988 1987
1986 1985
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period $ 21.12 $ 18.03 $ 16.16 $ 12.96 $ 17.80 $ 15.09 $ 18.52 $ 16.01 $ 13.98
$ 13.19
Income from investment
operations--
Net investment incom $ 0.244 $ 0.284 $ 0.326 $ 0.407 $ 0.413 $ 0.415 $ 0.301 $ 0.279 $ 0.336
$ 0.340
Net realized and
unrealized gain (loss)
on investments 0.316 3.720 2.044 3.943 (3.563) 3.335 (1.911) 3.757
2.414 0.965
Total income (loss)
from investment
operations $ 0.560 $ 4.004 $ 2.370 $ 4.350 $ (3.150) $ 3.750 $ (1.610) $ 4.036 $ 2.750
$ 1.305
Distribution to
shareholders from--
Net investment income 0.250 (0.290) (0.350) (0.410) (0.460) (0.360) (0.410) (0.360)
(0.360) (0.340)
Net realized capital
gains (1.510) (0.620) (0.150) (0.740) (1.230) (0.680) (1.410) (1.165)
(0.360) (0.175)
Net increase (decrease)
in net asset value $ (1.200) $ 3.094 $ 1.870 $ 3.200 $ (4.840) $ 2.710 $ (3.430) $ 2.511 $ 2.030
$ 0.790
Net asset value, end of
period $ 19.92 $ 21.12 $ 18.03 $ 16.16 $ 12.96 $ 17.80 $ 15.09 $ 18.52 $ 16.01
$ 13.98
Total return* 2.62% 22.82% 15.05% 35.80% (19.39%) 26.32% (6.00%) 27.50%
20.40% 10.21%
Ratio of net operating
expenses to average net
assets 0.86% 0.84% 0.85% 0.74% 0.71% 0.72% 0.76% 0.68%
0.71% 0.75%
Ratio of net investment
income to average net
assets 1.19% 1.43% 1.85% 2.72% 2.58% 2.56% 2.15% 1.74%
2.41% 3.08%
Portfolio turnover rate 15% 18% 12% 5% 14% 16% 12% 23%
24% 11%
Net assets end of period
(in thousands) $1,017,233 $1,019,059 $779,631 $692,344 $562,343 $752,135 $616,953 $734,300 $543,173
$369,080
</TABLE>
*Assumes initial investment at net asset value at the beginning of each year,
reinvestment of all dividends and distributions, the complete redemption of
the investment at the net asset value at the end of each year and no sales
charges. Total return would be reduced if sales charges were taken into
account.
<PAGE>
III. INVESTMENT OBJECTIVES AND POLICIES
The objectives of the Fund are
reasonable income and growth of capital. The Fund seeks these objectives by
investing in a broad list of carefully selected, reasonably priced securities
rather than in securities whose prices reflect a premium resulting from their
current market popularity. As all investments are subject to inherent market
risks and fluctuations in value due to earnings, economic conditions and
other factors, the Fund, of course, cannot give assurance that its investment
objectives will be achieved.
The major portion of the Fund's assets will be invested in equity securities,
including common and preferred stocks and securities convertible into common
or preferred stocks. Assets of the Fund will be substantially fully invested
at all times and, by this means, management intends to avoid speculating upon
broad changes in the level of the market.
In general, the largest portion of the Fund's portfolio, at any time, will
consist of securities which have yielded their holders an interest or
dividend return within the preceding twelve months; but non-income-producing
securities may be held for anticipated increases in value.
It is the policy of the Fund not to engage in trading for short-term profits
and the Fund intends to limit its portfolio turnover to the extent
practicable. Nevertheless, changes in the portfolio will be made promptly
when determined to be advisable by reason of developments not foreseen at the
time of the investment decision, and usually without reference to the length
of time a security has been held. Accordingly, the portfolio turnover rate
will not be considered a limiting factor in the execution of investment
decisions.
The Fund may enter into repurchase agreements with banks, generally not
exceeding seven days. Such repurchase agreements will be fully collateralized
with United States Treasury and/or U.S. government agency obligations with a
market value of not less than 100% of the obligation, valued daily.
Collateral will be held in a segregated, safekeeping account for the benefit
of the Fund. In the event that a repurchase agreement is not fulfilled, the
Fund could suffer a loss to the extent that the value of the collateral falls
below the repurchase price.
The objectives and policies above may not be changed without shareholder
approval. Other investment policies and restrictions on investment are
described in the Statement of Additional Information. These other investment
policies and restrictions on investments include a restriction limiting loans
by the Fund to the purchase of certain debt securities, loans of portfolio
securities and repurchase agreements, policies permitting the Fund to invest
up to 10% of its assets in foreign securities and up to 5% of its assets in
readily marketable equity securities of real estate investment trusts
(REITs), and a policy that the Fund will invest only in corporations with
market capitalizations not exceeding $750,000,000 on the date of the Fund's
initial investment ("Qualifying Investments"). The Fund may make follow-on
investments to any of its Qualifying Investments, notwithstanding any
increase in the aggregate market value of the outstanding capital stock of
any of the corporations in which it has made Qualifying Investments. In
addition, no more than 5% of the Fund's net assets may be invested in debt
securities, including convertible securities, which are rated below
investment grade or the equivalent.
Investing in securities of non-U.S. companies and countries involves certain
considerations and risks which are not typically associated with investing in
U.S. government securities and securities of domestic companies. Non-U.S.
companies are not generally subject to uniform accounting, auditing and
financial standards and requirements comparable to those applicable to U.S.
companies. There may also be less government supervision and regulation of
non-U.S. securities exchanges, brokers and listed companies than exists in
the United States. Interest and dividends paid by non-U.S. issuers may be
subject to withholding and other foreign taxes which may decrease the net
return on such investments as compared to interest or dividends paid to the
Fund by the U.S. government or by domestic companies. In addition, there may
be the possibility of expropriations, confiscatory taxation, political,
economic or social instability or diplomatic developments which could affect
assets of the Fund held in foreign countries. The value of non-U.S.
securities may be adversely affected by fluctuations in the relative rates of
exchange between the currencies of different nations and by exchange control
regulations. There may be less publicly available information about non-U.S.
companies and governments compared to reports and ratings published about
U.S. companies. Non-U.S. securities markets have substantially less volume
than domestic markets and securities of some non-U.S. companies are less
liquid and more volatile than securities of comparable U.S. companies.
Brokerage commissions, custodial services and other costs related to
investment in non-U.S. securities markets generally are more expensive than
in the United States. See "Investment Policies and Restrictions" in the
Statement of Additional Information.
The Fund has the ability to hold a portion of its assets in foreign
currencies and to enter into forward foreign currency contracts to facilitate
settlement of foreign securities transactions or to protect against changes
in foreign currency exchange rates. A forward foreign currency contract
involves an obligation to purchase or sell a specific currency on a future
date, at a price set at the time of the contract. The Fund might sell a
foreign currency on either a spot or forward basis to hedge against an
anticipated decline in the dollar value of securities in its portfolio or
securities it intends or has contracted to sell or to preserve the U.S.
dollar value of dividends, interest or other amounts it expects to receive.
Although this strategy could minimize the risk of loss due to a decline in
the value of the hedged foreign currency, it could also limit any potential
gain which might result from an increase in the value of the currency.
Alternatively, the Fund might purchase a foreign currency or enter into a
forward purchase contract for the currency to preserve the U.S. dollar price
of securities it is authorized to purchase or has contracted to purchase.
IV. MANAGEMENT OF THE FUND
The Fund's Board of Trustees has overall responsibility for management and
supervision of the Fund. There are currently eight Trustees, six of whom are
not "interested persons" of the Fund as defined in the Investment Company Act
of 1940, as amended (the "1940 Act"). The Board meets at least quarterly. By
virtue of the functions performed by Pioneering Man
<PAGE>
agement Corporation ("PMC") as investment adviser, the Fund requires no
employees other than its executive officers, all of whom receive their
compensation from PMC or other sources. The Statement of Additional
Information contains the names and general background of each Trustee and
executive officer of the Fund.
The Fund is managed under a contract with PMC. PMC serves as investment
adviser to the Fund and is responsible for the overall management of the
Fund's business affairs, subject only to the authority of the Board of
Trustees. PMC is a wholly-owned subsidiary of The Pioneer Group, Inc.
("PGI"), a Delaware corporation. Pioneer Funds Distributor, Inc. ("PFD"), a
wholly-owned subsidiary of PGI, is the principal underwriter of shares of the
Fund.
Each domestic equity portfolio managed by PMC, including this Fund, is
overseen by an Equity Committee, which consists of PMC's most senior equity
professionals, and a Portfolio Management Committee, which consists of PMC's
domestic equity portfolio managers. Both committees are chaired by Mr. David
Tripple, PMC's President and Chief Investment Officer and Executive Vice
President of each of the Funds. Mr. Tripple joined PMC in 1974 and has had
general responsibility for PMC's investment operations and specific portfolio
assignments for more than the last five years. Mr. Robert W. Benson is
primarily responsible for the day-to-day management of the Fund. Mr. Benson
joined PMC in 1974 and is Senior Vice President of PMC and Vice President of
the Fund.
In addition to the Fund, PMC also manages and serves as the investment
adviser for other mutual funds and is an investment adviser to certain other
institutional accounts. PMC's and PFD's executive offices are located at 60
State Street, Boston, Massachusetts 02109.
Under the terms of its contract with the Fund, PMC assists in the management
of the Fund and is authorized in its discretion to buy and sell securities
for the account of the Fund, subject to the right of the Fund's Trustees to
disapprove any such purchase or sale. PMC pays all the expenses, including
executive salaries and the rental of office space, related to its services
for the Fund with the exception of the following, which are paid by the Fund:
(a) taxes and other governmental charges, if any; (b) interest on borrowed
money, if any; (c) legal fees and expenses; (d) auditing fees; (e) insurance
premiums; (f) dues and fees for membership in trade associations; (g) fees
and expenses of registering and maintaining registrations by the Fund of its
shares with the Securities and Exchange Commission, individual states,
territories and foreign jurisdictions and of preparing reports to government
agencies; (h) fees and expenses of Trustees not affiliated with or interested
persons of PMC; (i) fees and expenses of the custodians, dividend disbursing
agent, transfer agent and registrar; (j) issue and transfer taxes chargeable
to the Fund in connection with securities transactions to which the Fund is a
party; (k) costs of reports to shareholders, shareholders' meetings and
Trustees' meetings; (l) the cost of share certificates; (m) bookkeeping and
appraisal charges; and (n) distribution fees in accordance with the Plan of
Distribution described below. The Fund also pays all brokerage commissions in
connection with its portfolio transactions.
Orders for the Fund's portfolio securities transactions are placed by PMC,
which strives to obtain the best price and execution for each transaction. In
circumstances where two or more broker-dealers are in a position to offer
comparable prices and execution, consideration may be given to whether the
broker-dealer provides investment research or brokerage services or sells
shares of any Pioneer mutual fund. See the Statement of Additional
Information for a further description of PMC's brokerage allocation
practices.
As compensation for its management services and certain expenses which PMC
incurs, PMC is entitled to a management fee equal to 0.50% per annum of the
Fund's average daily net assets up to $250 million, 0.48% of the next $50
million, and 0.45% of the excess over $300 million. The fee is normally
computed daily and paid monthly. During the fiscal year ended September 30,
1994, the Fund incurred expenses of approximately $8,868,000, including
management fees paid or payable to PMC of approximately $4,801,000.
John F. Cogan, Jr., Chairman and President of the Fund, Chairman of PFD,
President and a Director of PGI and Chairman and a Director of PMC, owned
approximately 15% of the outstanding capital stock of PGI as of the date of
this Prospectus.
V. DISTRIBUTION PLAN
The Fund has adopted a Plan of Distribution (the "Plan") in accordance with
Rule 12b-1 under the 1940 Act pursuant to which certain distribution fees are
paid to PFD. As required by Rule 12b-1, the Plan was approved by a majority
of the outstanding shares held by the shareholders of the Fund and by the
Trustees, including a majority of the Trustees who are not "interested
persons" of the Fund.
Pursuant to the Plan, the Fund reimburses PFD for its actual expenditures to
finance any activity primarily intended to result in the sale of Fund shares
or to provide services to Fund shareholders, provided the categories of
expenses for which reimbursement is made are approved by the Fund's Board of
Trustees. As of the date of this Prospectus, the Board of Trustees has
approved the following categories of expenses for the Fund: (i) a service fee
to be paid to qualified broker-dealers in an amount not to exceed 0.25% per
annum of the Fund's daily net assets; (ii) reimbursement to PFD for its
expenditures for broker-dealer commissions and employee compensation on
certain sales of the Fund's shares with no initial sales charge (See "How to
Purchase Shares"); and (iii) reimbursement to PFD for expenses incurred in
providing services to shareholders and supporting broker-dealers and other
organizations (such as banks and trust companies) in their efforts to provide
such services. Banks are currently prohibited under the Glass-Steagall Act
from providing certain underwriting or distribution services. If a bank was
prohibited from acting in any capacity or providing any of the described
services, management would consider what action, if any, would be
appropriate.
Expenditures of the Fund pursuant to the Plan are accrued daily and may not
exceed 0.25% of average daily net assets. Distribution expenses of PFD are
expected to substantially exceed the distribution fees paid by the Fund in a
given year. The Plan does not provide for the carryover of reimbursable
<PAGE>
expenses beyond 12 months from the time the Fund is first invoiced for an
expense. The limited carryover provision in the Plan may result in an expense
invoiced to the Fund in one fiscal year being paid in the subsequent fiscal
year and thus being treated for purposes of calculating the maximum
expenditures of the Fund as having been incurred in the subsequent fiscal
year. In the event of termination or non-continuance of the Plan, the Fund
has 12 months to reimburse any expense which it incurs prior to such
termination or non-continuance, provided that payments by the Fund during
such 12-month period shall not exceed 0.25% of the Fund's average net daily
assets during such period. The Plan may not be amended to increase materially
the annual percentage limitation of average net assets which may be spent for
the services described therein without approval of the shareholders of the
Fund.
VI. INFORMATION ABOUT FUND SHARES
How to Purchase Shares
Shares of the Fund may be purchased at the public offering price from any
securities broker-dealer having a sales agreement with PFD. The minimum
initial investment is $1,000, except for accounts being established to
utilize monthly bank drafts, government allotments and other similar
automatic investment plans. The minimum investment for these plans, as well
as all other subsequent additions to an account, is $50. Separate minimum
investment requirements apply to retirement plans and no sales charges or
minimum requirements apply to the reinvestment of dividends or capital gains
distributions.
The public offering price is the net asset value per share next computed
after receipt of a purchase order, plus a sales charge as follows:
Dealer
Sales Charge as a % of Allowance
Net as a % of
Offering Amount Offering
Amount of Purchase Price Invested Price
Less than $50,000 5.75% 6.10% 5.00%
$50,000 but less than $100,000 4.50 4.71 4.00
$100,000 but less than $250,000 3.50 3.63 3.00
$250,000 but less than $500,000 2.50 2.56 2.00
$500,000 but less than $1,000,000 2.00 2.04 1.75
$1,000,000 or more -0- -0- see below
No sales charge is payable at the time of purchase on investments of
$1,000,000 or more, but for such investments a contingent deferred sales
charge ("CDSC") of 1% is imposed in the event of certain redemption
transactions within one year of purchase. See "Redemptions and Repurchases"
below. PFD may, in its discretion, pay a commission to broker-dealers who
initiate and are responsible for such purchases as follows: 1% on the first
$1 million invested; 0.50% on the next $4 million; and 0.10% on the excess
over $5 million. These commissions will not be paid if the purchaser is
affiliated with the broker-dealer or if the purchase represents the
reinvestment of a redemption made during the previous 12 calendar months.
Broker-dealers who receive a commission in connection with purchases at net
asset value by 401(a) or 401(k) retirement plans with 1,000 or more eligible
participants or with at least $10 million in plan assets will be required to
return any commission paid or a pro rata portion thereof if the retirement
plan redeems its shares within 12 months of purchase. See also "Redemptions
and Repurchases." In connection with PGI's acquisition of Mutual of Omaha
Fund Management Company and contingent upon the achievement of certain sales
objectives, PFD pays to Mutual of Omaha Investor Services, Inc. 50% of PFD's
retention of any sales commission on sales of the Fund's shares through such
dealer. Shares sold outside the U.S. to persons who are not U.S. citizens may
be subject to different sales charges, CDSCs and dealer compensation
arrangements in accordance with local laws and business practices.
The schedule of sales charges above is applicable to purchases of shares of
the Fund by (i) an individual, (ii) an individual, his or her spouse and
children under the age of 21 and (iii) a trustee or other fiduciary of a
trust estate or fiduciary account or related trusts or accounts, including
pension, profit-sharing and other employee benefit trusts qualified under
Section 401 or 408 of the Internal Revenue Code of 1986, although more than
one beneficiary is involved.
The sales charge applicable to a current purchase of shares of the Fund by a
person listed above is determined by adding the value of shares to be
purchased to the aggregate value (at current offering price) of shares of any
of the Pioneer mutual funds previously purchased and then owned, provided PFD
is notified by such person or his or her broker-dealer each time a purchase
is made which would so qualify. (Pioneer mutual funds include all mutual
funds for which PFD serves as principal underwriter). For example, a person
investing $5,000 in the Fund who currently owns shares of the Pioneer funds
with a value of $45,000 would pay a sales charge of 4.50% of the offering
price on the new investment.
Sales charges may also be reduced through an agreement to purchase a
specified quantity of shares over a designated 13-month period by completing
the "Letter of Intention" section of the Account Application. Information
about the Letter of Intention procedure, including its terms, is contained in
the Account Application as well as in the Statement of Additional
Information.
Shares of the Fund may be sold at a reduced or eliminated sales charge to
certain group plans under which a sponsoring organization makes
recommendations to, permits group solicitation of, or otherwise facilitates
purchases by, its employees, members or participants. Information about such
arrangements is available from PFD.
Shares of the Fund may also be sold at net asset value per share without a
sales charge to: (a) current or former Trustees and officers of the Fund and
employees and partners of its legal counsel; (b) current or former directors,
officers, employees or sales representatives of PGI or its subsidiaries; (c)
current or former directors, officers, employees or sales representatives of
any subadviser or predecessor investment adviser to any investment company
for which PMC serves as investment adviser, and the subsidiaries or
affiliates of such persons; (d) current or former officers, partners,
employees or registered representatives of broker-dealers which have entered
into sales agreements with PFD; (e) members of the immediate families of any
of the persons listed above; (f) any trust, custodian, pension,
profit-sharing or other benefit plan of the foregoing persons; (g) insurance
company separate accounts; (h) certain "wrap accounts" for the benefit of
clients of financial planners adhering to standards established
<PAGE>
by PFD; (i) other funds and accounts for which PMC or any of its affiliates
serves as investment adviser or manager; and (j) certain unit investment
trusts. Shares so purchased are purchased for investment purposes and may not
be resold except through redemption or repurchase by or on behalf of the
Fund. The availability of this privilege depends upon the receipt by PFD of
written notification of eligibility. Shares may also be sold at net asset
value without a sales charge in connection with certain reorganization,
liquidation or acquisition transactions involving other investment companies
or personal holding companies.
Investors who are clients of a broker-dealer with a current sales agreement
with PFD may purchase shares of the Fund at net asset value, without a sales
charge, to the extent that the purchase price is paid out of proceeds from
one or more redemptions by the investor of shares of certain other mutual
funds. In order for a purchase to qualify for this privilege, the investor
must document to the broker-dealer that the redemption occurred within 60
days immediately preceding the purchase of shares of the Fund; that the
client paid a sales charge on the original purchase of the shares redeemed;
and that the mutual fund whose shares were redeemed also offers net asset
value purchases to redeeming shareholders of any of the Pioneer mutual funds.
Further details may be obtained from PFD.
Net Asset Value and Pricing of Orders
Shares of the Fund are sold at the public offering price, which is the net
asset value per share plus the applicable sales charge. Net asset value per
share of the Fund is determined by dividing the value of its assets, less
liabilities, by the number of shares outstanding. The net asset value is
computed once daily, on each day the New York Stock Exchange (the "Exchange")
is open, as of the close of regular trading on the Exchange.
Securities are valued at the last sale price on the principal exchange or
market where they are traded. Securities which have not traded on the date of
valuation or securities for which sales prices are not generally reported are
valued at the mean between the last bid and asked prices. Securities quoted
in foreign currencies are converted to U.S. dollars utilizing foreign
exchange rates employed by the Fund's independent pricing services.
Generally, trading in foreign securities is substantially completed each day
at various times prior to the close of regular trading hours on the Exchange.
The values of such securities used in computing the net asset value of the
Fund's shares are determined as of such times. Foreign currency exchange
rates are also generally determined prior to the close of regular trading
hours on the Exchange. Occasionally, events which affect the values of such
securities and such exchange rates may occur between the times at which they
are determined and the close of regular trading hours on the Exchange and
will therefore not be reflected in the computation of the Fund's net asset
value. If events materially affecting the value of such securities occur
during such period, then these securities are valued at their fair value as
determined in good faith by the Trustees. All assets of the Fund for which
there is no other readily available valuation method are valued at their fair
value as determined in good faith by the Trustees.
An order for shares received by a broker-dealer prior to the close of regular
trading on the Exchange (currently 4:00 P.M. Eastern Time) is confirmed at
the redemption price determined at the close of regular trading on the
Exchange on the day the order is received, provided the order is received by
PFD prior to PFD's close of business (usually 5:30 p.m. Eastern time). It is
the responsibility of broker-dealers to transmit orders so that they will be
received by PFD prior to PFD's close of business. An order received by a
broker-dealer following the close of regular trading on the Exchange will be
confirmed at the redemption price as of the close of regular trading on the
Exchange on the next trading day.
The Fund reserves the right in its sole discretion to withdraw all or any
part of the offering of shares when, in the judgment of the Fund's
management, such withdrawal is in the best interest of the Fund. An order to
purchase shares is not binding on, and may be rejected by, PFD until it has
been confirmed in writing by PFD and payment has been received.
Dividends, Distributions and Taxation
The Fund has elected to be treated, has qualified, and intends to qualify
each year as a "regulated investment company" under the Internal Revenue Code
of 1986, as amended (the "Code"), so that it will not pay federal income
taxes on income and capital gains distributed to shareholders at least
annually.
Under the Code, the Fund will be subject to a nondeductible 4% excise tax on
a portion of its undistributed income and capital gains if it fails to meet
certain distribution requirements with respect to each calendar year. The
Fund intends to make distributions in a timely manner and accordingly does
not expect to be subject to the excise tax.
The Fund's policy is to pay to shareholders dividends from net investment
income, if any, twice each year during the months of June and December.
Distributions from net short-term capital gains, if any, may be paid with
such dividends; distributions from net long-term capital gains will normally
be made once a year, in December. Distributions of dividends and capital
gains may also be made at such times as may be necessary to avoid federal
income or excise tax. Dividends from the Fund's net investment income,
certain net foreign exchange gains, and net short-term capital gains are
taxable as ordinary income and dividends from the Fund's net long-term
capital gains are taxable as long-term capital gains.
Unless shareholders specify otherwise, all distributions will be
automatically reinvested in additional full and fractional shares of the
Fund. For federal income tax purposes, all dividends are taxable as described
above whether a shareholder takes them in cash or reinvests them in
additional shares of the Fund. Information as to the federal tax status of
dividends and distributions will be provided annually.
Dividends and other distributions and the proceeds of redemptions, exchanges
or repurchases of Fund shares paid to individuals and other non-exempt payees
will be subject to a 31% backup withholding of federal income tax if the Fund
is not provided with the shareholder's correct taxpayer identification number
and certification that the number is correct and the shareholder is not
subject to such backup withholding or the Fund receives notice from the IRS
or a broker that such withholding applies. Please refer to the Account
Application for additional information.
<PAGE>
The description above relates only to U.S. federal income tax consequences
for shareholders who are U.S. persons, i.e., U.S. citizens or residents or
U.S. corporations, partnerships, trusts or estates and who are subject to
U.S. federal income tax. Shareholders should consult their own tax advisors
regarding these matters, and regarding state, local and other applicable tax
laws.
Redemptions and Repurchases
Redemptions by Mail
As a shareholder, you have the right to offer your shares for redemption by
delivering to Pioneering Services Corporation ("PSC") a written request for
redemption, signed by all registered owners, in proper form and, if
applicable, your share certificates properly endorsed and in good order for
transfer. Redemptions will be made in cash less any applicable CDSC at the
net asset value per share next determined following receipt by PSC of all
necessary documents.
Good order means that the certificates must be endorsed by the record
owner(s) exactly as the shares are registered and the signature(s) must be
guaranteed by any of the following eligible guarantor institutions: (i) all
brokers, dealers, municipal securities dealers and/or brokers, and government
securities dealers and/or brokers who are members of a clearing agency or
whose net capital exceeds $100,000; (ii) all banks; (iii) all credit unions;
(iv) all savings associations, including all savings and loan associations;
(v) all national securities exchanges, registered securities associations,
and all clearing agencies; and (vi) all trust companies. In addition, in some
cases (involving fiduciary or corporate transactions), good order may require
the furnishing of additional documents. Signature guarantees may be waived
for redemption requests of $50,000 or less, provided that the record holder
executes the redemption request, and payment is directed to the record holder
at the address of record and the address has not changed for the previous 30
days. You cannot provide a signature guarantee by facsimile ("fax"). Payment
normally will be made within seven days after receipt of these documents. The
Fund reserves the right to withhold payment until checks received in payment
of shares purchased have cleared, which may take up to 15 calendar days from
the purchase date. For additional information about the necessary
documentation for redemption by mail, please contact PSC at 1-800-225-6292.
Redemptions by Telephone or Fax
Your account is automatically authorized to have the telephone redemption
privilege unless you indicated otherwise on your Account Application or by
writing to PSC. Proper account identification will be required for each
telephone redemption. The telephone redemption option is not available to
retirement plan accounts. A maximum of $50,000 may be redeemed by telephone
or fax and the proceeds may be received by check or by bank wire. To receive
the proceeds by check: the check must be made payable exactly as the account
is registered and the check must be sent to the address of record which must
not have changed in the last 30 days. To receive the proceeds by bank wire:
the wire must be sent to the bank wire address of record which must have been
properly predesignated either on your Account Application or on an Account
Options Form and which must not have changed in the last 30 days. To redeem
by fax, send your redemption request to 1-800-225-4240. You may always elect
to deliver redemption instruction to PSC by mail. See "Telephone Transactions
and Related Liabilities" below. Telephone redemptions will be priced as
described above.
Additional Conditions of Redemption
For the convenience of shareholders, the Fund has authorized PFD to act as
its agent in the repurchase of shares of the Fund. Offers to sell shares to
the Fund may be communicated to PFD by wire or telephone by broker-dealers
for their customers. The Fund's practice will be to repurchase shares offered
to it at the net asset value per share determined as of the close of regular
trading on the New York Stock Exchange on the day the offer for repurchase is
received and accepted by the broker-dealer if the offer is received by PFD
before the close of business on that day.
A broker-dealer which receives an offer for repurchase is responsible for the
prompt transmittal of such offer to PFD. Payment of the repurchase proceeds
will be made in cash to the broker-dealer placing the order. Except for
certain large accounts subject to a CDSC (as described below), neither the
Fund nor PFD charges any fee or commission upon such repurchase which is then
settled as an ordinary transaction with the broker-dealer (which may charge
the shareholder for this service) delivering the shares repurchased. Payment
will be made within seven days of the receipt by PSC of valid instructions,
including validly endorsed certificates, if appropriate, in good order as
described above.
The net asset value per share received upon redemption or repurchase may be
more or less than the cost of shares to an investor, depending upon the
market value of the portfolio at the time of redemption or repurchase.
Redemptions and repurchases are taxable transactions to shareholders.
Redemptions may be suspended or payment postponed during any period in which
any of the following conditions exists: the Exchange is closed or trading on
the Exchange is restricted; an emergency exists as a result of which disposal
by the Fund of securities owned by it is not reasonably practicable or it is
not reasonably practicable for the Fund to fairly determine the value of the
net assets of its portfolio; or the Securities and Exchange Commission (the
"SEC"), by order, so permits.
Purchases of $1,000,000 or more, and purchases by participants in a group
plan ("Group Plan") which have not been subject to a sales charge, may be
subject to a CDSC upon redemption. A CDSC is payable to PFD on these
investments in the event of a share redemption within 12 months following the
share purchase, at the rate of 1% of the lesser of the value of the shares
redeemed (exclusive of reinvested dividend and capital gain distributions) or
the total cost of such shares. In determining whether a CDSC is payable, and,
if so, the amount of the charge, it is assumed that shares purchased with
reinvested dividend and capital gain distributions and then such other shares
which are held the longest will be the first redeemed. Shares subject to the
CDSC which are exchanged into another Pioneer fund will continue to be
subject to the CDSC until the original 12-month period expires.
<PAGE>
However, no CDSC is payable with respect to purchases of shares by 401(a) or
401(k) retirement plans with 1,000 or more eligible participants or with at
least $10 million in plan assets.
Waiver or Reduction of Contingent Deferred Sales Charge. The CDSC on any
shares subject to a CDSC may be waived or reduced for non-retirement accounts
if: (a) the redemption results from the death of all registered owners of an
account (in the case of UGMAs, UTMAs and trust accounts, waiver applies upon
the death of all beneficial owners) or a total and permanent disability (as
defined in Section 72 of the Code) of all registered owners occurring after
the purchase of the shares being redeemed or (b) the redemption is made in
connection with a Systematic Withdrawal Plan (limited in any year to 10% of
the value of the account in the Fund at the time the withdrawal plan is
established).
The CDSC on any shares subject to a CDSC may be waived or reduced for
retirement plan accounts if: (a) the redemption results from the death or a
total and permanent disability (as defined in Section 72 of the Code)
occurring after the purchase of the shares being redeemed of a shareholder or
participant in an employer-sponsored retirement plan; (b) the distribution is
to a participant in an IRA, 403(b) or employer-sponsored retirement plan, is
part of a series of substantially equal payments made over the life
expectancy of the participant or the joint life expectancy of the participant
and his or her beneficiary or as scheduled periodic payments to a participant
(limited in any year to 10% of the value of the participant's account at the
time the distribution amount is established; a required minimum distribution
due to the participant's attainment of age 70-1/2 may exceed the 10% limit
only if the distribution amount is based on plan assets held by Pioneer); (c)
the distribution is from a 401(a) or 401(k) retirement plan and is a return
of excess employee deferrals or employee contributions or a qualifying
hardship distribution as defined by the Code or results from a termination of
employment (limited with respect to a termination to 10% per year of the
value of the plan's assets in the Fund as of the later of the prior December
31 or the date the account was established unless the plan's assets are being
rolled over to or reinvested in the same class of shares of a Pioneer mutual
fund subject to the CDSC of the shares originally held); (d) the distribution
is from an IRA, 403(b) or employer-sponsored retirement plan and is to be
rolled over to or reinvested in the same class of shares in a Pioneer mutual
fund and which will be subject to the applicable CDSC upon redemption; (e)
the distribution is in the form of a loan to a participant in a plan which
permits loans (each repayment of the loan will constitute a new sale which
will be subject to the applicable CDSC upon redemption); or (f) the
distribution is from a qualified defined contribution plan and represents a
participant's directed transfer (provided that this privilege has been
preauthorized through a prior agreement with PFD regarding participant
directed transfers).
The CDSC on any shares subject to a CDSC may be waived or reduced for either
non-retirement or retirement plan accounts if: (a) the redemption is made by
any state, county, or city, or any instrumentality, department, authority, or
agency thereof, which is prohibited by applicable laws from paying a CDSC in
connection with the acquisition of shares of any registered investment
management company; or (b) the redemption is made pursuant to the Fund's
right to liquidate or involuntarily redeem shares in a shareholder's account.
Redemption of Small Accounts
If you hold shares of the Fund in an account with a value of less than $500
as a result of redemptions or exchanges, the Fund may redeem the shares held
in this account at net asset value if you have not increased the net asset
value of the account to at least $500 within six months of notice by the Fund
to you of the Fund's intention to redeem the shares.
Description of Shares and Voting Rights
The Fund is an open-end diversified management investment company (commonly
referred to as a mutual fund) which was organized as a Massachusetts
corporation on August 16, 1982 and reorganized as a Massachusetts business
trust on January 31, 1985.
The Fund has only one class of shares, entitled Shares of Beneficial
Interest. Each share represents an equal proportionate interest in the Fund
with each other share. Shareholders are entitled to one vote for each share
held and may vote in the election and removal of Trustees and on other
matters submitted to shareholders. Shares have no pre-emptive or conversion
rights. Shares are fully-paid and, except as set forth in the Statement of
Additional Information, non-assessable. Upon liquidation of the Fund, the
Fund's shareholders would be entitled to share pro rata in the Fund's net
assets available for distribution. Shares will remain on deposit with PSC and
certificates will not be issued unless requested. Certificates for fractional
shares will not be issued. The Fund reserves the right to charge a fee for
the issuance of certificates.
The Fund will recognize stock certificates representing shares of Pioneer
Three, Inc. issued prior to its reorganization as a Massachusetts business
trust as evidence of ownership of an equivalent number of shares of
beneficial interest. Any shareholder desiring to surrender a stock
certificate to the Fund for a share certificate representing an equivalent
number of shares of beneficial interest may do so by making a written request
for such exchange to PSC. Such request must be accompanied by the surrendered
stock certificate which must be endorsed on the back exactly in the manner as
such certificate is registered.
The Fund reserves the right to create and issue additional series of shares,
in which case the shares of each series would participate equally in the
earnings, dividends and assets of the particular series. Shares of each
series would be entitled to vote separately to approve investment advisory
agreements or changes in investment restrictions, but shares of all series
would be entitled to vote together in the election or selection of Trustees
and accountants.
VII. SHAREHOLDER SERVICES
PSC is the shareholder services and transfer agent for shares of the Fund.
PSC, a Massachusetts corporation, is a wholly-owned subsidiary of PGI. PSC's
offices are located at 60 State Street, Boston, Massachusetts 02109, and
inquiries to PSC should be mailed to Shareholder Services,
<PAGE>
Pioneering Services Corporation, P.O. Box 9014, Boston, Massachusetts
02205-9014. Brown Brothers Harriman & Co. (the "Custodian") serves as
custodian of the Fund's portfolio securities. The principal business address
of the Custodian's Mutual Fund Division is 40 Water Street, Boston,
Massachusetts 02109. The fees of the transfer agent and the Custodian are
paid by the Fund.
Account and Confirmation Statements
PSC maintains an account for each shareholder and all transactions of the
shareholder are recorded in this account. Confirmation statements showing the
details of transactions are sent to shareholders as transactions occur,
except Automatic Investment Plan transactions which are confirmed quarterly.
The Pioneer combined Account Statement, mailed quarterly, is available to all
shareholders who have more than one Pioneer account.
Shareholders whose shares are held in the name of an investment broker-dealer
or other party will not normally have an account with the Fund and might not
be able to utilize some of the services available to shareholders of record.
Examples of services which might not be available are investment or
redemption of shares by mail, automatic reinvestment of dividends and capital
gains distributions, withdrawal plans, Letters of Intention, Rights of
Accumulation, telephone exchanges and redemptions, and newsletters.
Additional Investments
Additions to a shareholder's account may be made by sending a check ($50
minimum) to PSC (account number should be clearly indicated). The bottom
portion of a confirmation statement may be used as a remittance slip to make
additional investments. Additions to your account, whether by check or
through a Pioneer Investomatic Plan, are invested in full and fractional
shares of the Fund at the applicable offering price in effect as of the close
of regular trading on the New York Stock Exchange on the day of receipt.
Automatic Investment Plans
You may arrange for regular investments of $50 or more through
government/military allotments or through a Pioneer Investomatic Plan. A
Pioneer Investomatic Plan provides for a monthly or quarterly investment by
means of a preauthorized draft drawn on a checking account. Pioneer
Investomatic Plan investments are voluntary, and you may discontinue the plan
without penalty upon 30 days' written notice to PSC. PSC acts as agent for
the purchaser, the broker-dealer and PFD in maintaining these plans.
Financial Reports and Tax Information
As a shareholder, you will receive financial reports at least semi-annually.
In January of each year, the Fund will mail to you information about the tax
status of dividends and distributions.
Distribution Options
Dividends and capital gains distributions, if any, will automatically be
invested in additional shares of the Fund, at the applicable net asset value
per share, unless you indicate another option on the account application.
Two other options available are (a) dividends in cash and capital gains
distributions in additional shares; and (b) all dividends and distributions
in cash. These two options are not available, however, for retirement plans
or an account with a net asset value of less than $500. Changes in the
distribution options may be made by written request to PSC.
Directed Dividends
You may elect (in writing) to have the dividends paid by one Pioneer fund
account invested in a second Pioneer fund account. The value of this second
account must be at least $1,000 ($500 for Pioneer Fund or Pioneer II).
Invested dividends may be in any amount and there are no fees or charges for
this service. Retirement plan shareholders may only direct dividends to
accounts with identical registrations; i.e., PGA IRA Cust for John Smith may
only go into another account registered PGA IRA Cust for John Smith.
Direct Deposit
If you have elected to take distributions, whether dividends or dividends and
capital gains, in cash, or have established a Systematic Withdrawal Plan, you
may choose to have those cash payments deposited directly into your savings,
checking or NOW bank account. You may establish this service by completing
the appropriate section on the Account Application when opening a new account
or the Account Options Form for an existing account.
Voluntary Tax Withholding
You may request (in writing) that PSC withhold 28% of the dividends and
capital gains distributions paid from your account (before any reinvestment)
and forward the amount withheld to the Internal Revenue Service as a credit
against your federal income taxes. This option is not available for
retirement plan accounts or for accounts subject to backup withholding.
Exchange Privilege
You may exchange your shares of the Fund at net asset value, without a sales
charge, for shares of other Pioneer funds which do not offer different
classes of shares or for the Class A shares of those Pioneer funds that offer
more than one class of shares. There are currently no fees or sales charges
on such an exchange.
Exchanges must be at least $1,000. A new Pioneer account opened through an
exchange must have a registration identical to that on the original account.
PSC will process exchanges only after receiving an exchange request in proper
form. An exchange of shares may be made only in states where legally
permitted.
Written Exchanges. If the exchange request is in writing, it must be signed
by all record owner(s) exactly as the shares are registered. If your original
account includes an Investomatic or Systematic Withdrawal Plan and you open a
new account by exchange, you should specify whether the plans should continue
in your new account or remain with your original account.
<PAGE>
Telephone Exchanges. Your account is automatically authorized to have the
telephone exchange privilege unless you indicated otherwise on your Account
Application or by writing to PSC. Proper account identification will be
required for each telephone exchange. Telephone exchanges may not exceed
$500,000 per account per day, and all telephone exchange requests will be
recorded.
Automatic Exchange. You may automatically exchange shares from one Pioneer
account to another Pioneer account on a regular schedule, either monthly or
quarterly. The accounts must have identical registrations and the originating
account must have a minimum balance of $5,000. The exchange will occur on the
18th day of each month.
If an exchange request is received by PSC before 4:00 p.m. Eastern Time (or
before the time that the Exchange closes for regular trading on that day, if
different), the exchange will be effective on that day if the requirements
above have been met. If the exchange request is received after 4:00 p.m.
Eastern Time, the exchange will be effective on the following business day.
You should consider the differences in objectives and policies of the Pioneer
mutual funds, as described in each fund's current prospectus, before making
any exchange. For federal and (generally) state income tax purposes, an
exchange represents a sale of the shares exchanged and a purchase of shares
in another fund. Therefore, an exchange could result in a gain or loss on the
shares sold, depending on the tax basis of these shares and the timing of the
transaction, and special tax rules may apply.
To prevent abuse of the exchange privilege to the detriment of other Fund
shareholders, the Fund and PFD reserve the right to limit the number and/or
frequency of exchanges and/or to charge a fee for exchanges.
Telephone Transactions and Related Liabilities
Your account is automatically authorized to have telephone transaction
privileges unless you indicated otherwise on your Account Application or by
writing to PSC. You may sell or exchange your Fund shares by telephone by
calling 1-800-225-6292 between 8:00 a.m. and 8:00 p.m. Eastern Time on
weekdays. See "Net Asset Value and Pricing of Orders" for more information.
To confirm that each transaction instruction received by telephone is
genuine, PSC will record each telephone transaction, require the caller to
provide the personal identification number (PIN) for the account and send you
a written confirmation of each telephone transaction. Different procedures
may apply to accounts that are registered to non-U.S. citizens or held in the
name of an institution or in the name of an investment broker-dealer or other
third-party. If reasonable procedures, such as those described above, are not
followed, the Fund may be liable for any loss due to unauthorized or
fraudulent instructions. The Fund may implement other procedures from time to
time. In all other cases, neither the Fund, PSC or PFD will be responsible
for the authenticity of instructions received by telephone; therefore, you
bear the risk of loss for unauthorized or fraudulent telephone transactions.
During times of economic turmoil or market volatility or as a result of
severe weather or a natural disaster, it may be difficult to contact the Fund
by telephone to institute a redemption or exchange. You should communicate
with the Fund in writing if you are unable to reach the Fund by telephone.
Telecommunications Device for the Deaf (TDD)
If you have a hearing disability and you own TDD keyboard equipment, you can
call our TDD number toll-free at 1-800-225-1997, weekdays from 8:30 a.m. to
5:30 p.m. Eastern Time to contact our telephone representatives with
questions about your account.
Retirement Plans
Interested persons should contact the Retirement Plans Department of PSC at
1-800-622-0176 for information relating to retirement plans for business,
Simplified Employee Pension Plans, Individual Retirement Accounts (IRAs),
Section 403(b) retirement plans for employees of certain non-profit
organizations and public school systems, all of which are available in
conjunction with investments in the Fund. The Pioneer Mutual Funds Account
Application accompanying this Prospectus should not be used to establish any
of the plans. Separate applications are required.
Systematic Withdrawal Plans
If your account has a total value of at least $10,000, you may establish a
Systematic Withdrawal Plan providing for fixed payments at regular intervals.
Periodic checks of $50 or more will be sent to you, or any person designated
by you, monthly or quarterly and your periodic redemptions of shares may be
taxable to you. You may also direct that withdrawal checks be paid to another
person, although if you make this designation after you have opened your
account, a signature guarantee must accompany your instructions. Purchases of
shares of the Fund at a time when you have a Systematic Withdrawal Plan in
effect may result in the payment of unnecessary sales charges and may
therefore be disadvantageous.
You may obtain additional information by telephoning PSC at 1-800-225-6292 or
by referring to the Statement of Additional Information.
Reinstatement Privilege
If you redeem all or part of your shares of the Fund, you may reinvest all or
part of the redemption proceeds without a sales commission in shares of the
Fund if you send a written request to PSC not more than 90 days after your
shares were redeemed. Your redemption proceeds will be reinvested at the next
determined net asset value of the shares of the Fund immediately after
receipt of the written request for reinstatement. You may realize a gain or
loss for federal income tax purposes as a result of the redemption, and
special tax rules may apply if a reinvestment occurs. Subject to the
provisions outlined under "Exchange Privilege" above, you may also reinvest
in shares of other Pioneer mutual funds; in this case you must meet the
minimum investment requirement for each fund you enter.
The 90-day reinstatement period may be extended by PFD for periods of up to
one year for shareholders living in areas that have experienced a natural
disaster, such as a flood, hurricane, tornado or earthquake.
<PAGE>
The options and services available to shareholders, including the terms of
the Exchange Privilege and the Pioneer Investomatic Plan, may be revised,
suspended or terminated at any time by PFD or by the Fund. You may establish
the services described in this section when you open your account. You may
also establish or revise many of them on an existing account by filling out
an Account Options Form, which you may request by calling 1-800-225-6292.
VIII. INVESTMENT RESULTS
The Fund may include in advertisements, and furnish to existing or
prospective shareholders, information concerning the average annual total
return on an investment in the Fund for a designated period of time. Whenever
this information is provided, it includes a standardized calculation of
average annual total return computed by determining the average annual
compounded rate of return that would cause a hypothetical investment (after
deduction of the maximum sales charge) made on the first day of the
designated period (assuming all dividends and distributions are reinvested)
to equal the resulting net asset value of such hypothetical investment on the
last day of the designated period. The periods illustrated would normally
include one, five and ten years. These standardized calculations do not
reflect the impact of federal or state income taxes.
The computation method above is prescribed for advertising and other
communications subject to SEC Rule 482. Communications not subject to this
rule may contain one or more additional measures of investment results,
computation methods and assumptions, including but not limited to: historical
total returns; distribution returns; results of actual or hypothetical
investments; changes in dividends, distributions or share values; or any
graphic illustration of such data. These data may cover any period of the
Fund's existence and may or may not include the impact of sales charges,
taxes or other factors.
The Fund may also include information on other investments or savings
vehicles and/or unmanaged market indexes, indicators of economic activity,
averages of mutual funds results or comparative performance information in
advertising or marketing the Fund's shares. Rankings or listings by
magazines, newspapers or independent statistical or ratings services, such as
Lipper Analytical Services, Inc., may also be referenced.
The Fund's investment results will vary from time to time depending on market
conditions, the composition of the Fund's portfolio and operating expenses of
the Fund. Therefore, any prior investment results of the Fund should not be
considered representative of what an investment in the Fund may earn in any
future period. These factors and possible differences in the methods used in
calculating investment results should be considered when comparing
performance information regarding the Fund to information published for other
investment companies, investment vehicles and unmanaged indexes. The Fund's
investment results should also be considered relative to the risks associated
with the Fund's investment objectives and policies.
For further information about the calculation methods and uses of the Fund's
investment results, see the Statement of Additional Information.
<PAGE>
Notes
<PAGE>
Notes
<PAGE>
THE PIONEER FAMILY OF MUTUAL FUNDS
Growth Funds
Pioneer Capital Growth Fund
Pioneer Growth Shares
Pioneer International Growth Fund
Pioneer Europe Fund
Pioneer Emerging Markets Fund
Growth and Income Funds
Pioneer Three
Pioneer II
Pioneer Fund
Pioneer Equity-Income Fund
Pioneer Winthrop Real Estate Investment Fund
Income Funds
Pioneer Income Fund
Pioneer Bond Fund
Pioneer America Income Trust
Pioneer Tax-Free Income Fund
Pioneer California Double Tax-Free Fund
Pioneer Massachusetts Double Tax-Free Fund
Pioneer New York Triple Tax-Free Fund
Pioneer Intermediate Tax-Free Fund
Pioneer Short-Term Income Trust
Specialized Growth
Pioneer Gold Shares
Pioneer India Fund
Money Market Funds
Pioneer Cash Reserves Fund
Pioneer Tax-Free Money Fund
Pioneer U.S. Government Money Fund
<PAGE>
[Pioneer logo]
Pioneer
Three
60 State Street
Boston, Massachusetts 02109
OFFICERS
JOHN F. COGAN, JR., Chairman and President
DAVID D. TRIPPLE, Executive Vice President
ROBERT W. BENSON, Vice President
WILLIAM H. KEOUGH, Treasurer
JOSEPH P. BARRI, Secretary
INVESTMENT ADVISER
PIONEERING MANAGEMENT CORPORATION
PRINCIPAL UNDERWRITER
PIONEER FUNDS DISTRIBUTOR, INC.
CUSTODIAN
BROWN BROTHERS HARRIMAN & CO.
INDEPENDENT PUBLIC ACCOUNTANTS
ARTHUR ANDERSEN LLP
LEGAL COUNSEL
HALE AND DORR
SHAREHOLDER SERVICES AND TRANSFER AGENT
PIONEERING SERVICES CORPORATION
60 State Street
Boston, MA 02109
Telephone: (617) 742-7825
SERVICE INFORMATION
If you would like information on the following, please call . . .
Existing and new accounts, prospectuses,
applications, service forms
and telephone transactions .................................... 1-800-225-6292
Automated fund yields, prices and
account information ............................................ 1-800-225-4321
Retirement plans ............................................... 1-800-622-0176
Toll-free fax .................................................. 1-800-225-4240
Telecommunications Device for the Deaf (TDD) ................... 1-800-225-1997
0195-2211
(C)Pioneer Funds Distributor, Inc.
<PAGE>
