[Pioneer logo]
Pioneer Cash Reserves Fund
Pioneer U.S. Government Money Fund
Pioneer Tax-Free Money Fund
Class A and Class B Shares
Prospectus March 31, 1995
(revised September 8, 1995)
Pioneer Cash Reserves Fund, Pioneer U.S. Government Money Fund and Pioneer
Tax-Free Money Fund (the "Funds") are money market funds. The Funds' Class A
shares are offered without a sales charge. The Funds' investment objective is
to provide high current income, preservation of capital and liquidity through
investments in high-quality short-term securities. Each Fund employs
different investment policies to achieve this investment objective.
Pioneer Cash Reserves Fund (Class A and B Shares)--a portfolio of money
market instruments, including: securities of the United States government and
its agencies and instrumentalities; certificates of deposit; corporate
commercial paper; and other debt instruments.
Pioneer U.S. Government Money Fund (Class A Shares Only)--a portfolio of
securities issued or guaranteed as to principal and interest by the United
States government, the interest on which is generally exempt from state
income tax.
Pioneer Tax-Free Money Fund (Class A Shares Only)--a portfolio of
obligations issued by states, territories and possessions of the United
States ("U.S.") the interest on which is exempt from federal income tax.
This Prospectus (Part A of the Registration Statement) provides
information about the Funds that you should know before investing. Please
read and keep it for your future reference. More information about the Funds
is included in Part B, the Statement of Additional Information, dated March
31, 1995, which is incorporated into this Prospectus by reference. You may
obtain a copy of the Statement of Additional Information free of charge by
calling Shareholder Services at 1-800-225-6292 or by written request to the
Funds at 60 State Street, Boston, Massachusetts 02109. Other information
about the Funds has been filed with the Securities and Exchange Commission
(the "SEC") and is available upon request and without charge.
The yield for each Fund will fluctuate. Shares in the Funds are not
deposits or obligations of, or guaranteed or endorsed by, any bank, and the
shares are not federally insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board or any other agency. INVESTMENTS IN
THE FUNDS ARE NEITHER INSURED NOR GUARANTEED BY THE UNITED STATES GOVERNMENT.
THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL BE ABLE TO MAINTAIN A STABLE
NET ASSET VALUE OF $1.00 PER SHARE.
TABLE OF CONTENTS PAGE
- --------------------------------------------------------------------
I. EXPENSE INFORMATION 2
II. FINANCIAL HIGHLIGHTS 4
III. THE TRUST 5
IV. THREE INVESTMENT PROGRAMS 5
Suitability 5
Investment Policies 5
Additional Information 7
V. FUND SHARE ALTERNATIVES 8
Class A Shares 8
Class B Shares 8
VI. SHARE PRICE 9
VII. HOW TO BUY FUND SHARES 9
VIII. HOW TO SELL FUND SHARES 12
IX. HOW TO EXCHANGE FUND SHARES 14
X. DISTRIBUTION PLANS 15
XI. DIVIDENDS, DISTRIBUTIONS AND TAXATION 15
XII. MANAGEMENT OF THE TRUST 17
XIII. DESCRIPTION OF SHARES AND VOTING RIGHTS 18
XIV. SHAREHOLDER SERVICES 18
Account and Confirmation Statements 18
Additional Investments 18
Automatic Investment Plans 19
Financial Reports and Tax Information 19
Dividend Options 19
Voluntary Tax Withholding 19
Retirement Plans 19
Yield Information 19
Telecommunications Device for the Deaf (TDD) 19
Systematic Withdrawal Plans 20
Telephone Transactions and Related Liabilities 20
FactFone((SM)) 20
XV. INVESTMENT RESULTS 20
XVI. APPENDIX 21
---------------------------
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 Funds. The table reflects annual operating expenses based upon actual
expenses of the Class A shares for the fiscal year ended December 31, 1994,
expressed as a percentage of the average net assets of each Fund.
<TABLE>
<CAPTION>
Pioneer Cash
Reserves Fund
- ---------------------------
Shareholder Transaction Expenses: Class A
Class B
<S> <C> <C>
Maximum Initial Sales Charge on Purchases (as a percentage of offering
price) None
None
Maximum Sales Charge on Reinvestment of Dividends None
None
Maximum Deferred Sales Charge (as a percentage of original purchase
price or redemption price, as applicable) None
4.00%
Redemption Fee((1)) None
None
Exchange Fee None
None
Annual Operating Expenses (as a percentage of net assets):((3))
Management Fee (after Expense Limitation)((2)) 0.25%
0.25%
12b-1 Fees 0.10%
1.00%
Other Expenses (including transfer agent fee, custodian fees and
accounting and printing expenses) 0.50%
0.50%
------------
- --------
Total Operating Expenses:
(after Expense Limitation)((2)) 0.85%
1.75%
============
========
Pioneer
Pioneer
U.S. Govern-
Tax-Free
ment Money
Money
Fund
Fund
------------
- --------
Shareholder Transaction Expenses:
Maximum Initial Sales Charge on Purchases (as a percentage of offering
price) None
None
Maximum Sales Charge on Reinvestment of Dividends None
None
Redemption Fee(1) None
None
Exchange Fee None
None
Annual Operating Expenses
(as a percentage of net assets):
Management Fee (after Expense Limitation)((2)) 0.00%
0.00%
12b-1 Fees 0.12%
0.09%
Other Expenses (including transfer agent fee, custodian fees and
accounting and printing expenses)
(after Expense Limitation)((2)) 0.73%
0.66%
Total Operating Expenses
(after Expense Limitation)((2)) 0.85%
0.75%
============
========
</TABLE>
((1)) Separate fees (currently $10 and $20, respectively) apply to domestic
or international bank wire transfers of redemption proceeds.
((2)) Effective April 1, 1995, Pioneering Management Corporation ("PMC"), the
Funds' investment adviser, has agreed not to impose its management fee
and to make other arrangements, if necessary, to limit the operating
expenses of each Fund as listed below. This agreement is voluntary and
temporary and may be revised or terminated at any time.
Pioneer
Pioneer U.S. Pioneer
Cash Government Tax-Free
Reserves Money Money
Fund Fund Fund Fund
- ----------------------------- -------- ---------- ----------
Management Fee 0.40% 0.40% 0.40%
Expense Limitation 0.85%* 0.85% 0.75%
Expenses Absent Limitation
Other Expenses
Class A n/a 0.78% 1.63%
Class B n/a n/a n/a
Total Operating Expenses
Class A 1.00% 1.30% 2.12%
Class B 1.90% n/a n/a
*For Pioneer Cash Reserves Fund, the portion of fund-wide expenses
attributable to Class B shares will be reduced only to the extent such
expenses are reduced for the Class A shares of that Fund.
((3)) For Class B shares, percentages are based on estimated expenses that
would have been incurred during the previous fiscal year had Class B
shares been outstanding.
Example:
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return and constant expenses, with or without redemption at the end of
each time period:
Pioneer Cash Reserves Fund
-------------------------------------------------
1 Year 3 Years 5 Years 10 Years
--------- --------- --------- -----------
Class A Shares $ 9 $27 $ 47 $ 104
Class B Shares
- --Assuming
complete
redemption at
end of period $58 $85 $115 $184*
- --Assuming no
redemption $18 $55 $ 95 $184*
*Class B shares convert to Class A shares eight years after purchase;
therefore, Class A expenses are used after year eight.
1 Year 3 Years 5 Years 10 Years
-------- -------- -------- ----------
Pioneer U.S. Government
Money Fund $9 $27 $47 $105
Pioneer Tax-Free Money Fund $8 $24 $42 $ 94
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.
2
<PAGE>
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.
A sales charge may be applied to exchanges of shares of the Funds for
shares of certain other Pioneer mutual funds. See "How to Exchange Fund
Shares." The payment of Rule 12b-1 fees by each fund may result in long-term
shareholders of a Fund indirectly paying more than the economic equivalent of
the maximum sales charge permitted under the Rules of Fair Practice of the
National Association of Securities Dealers, Inc. ("NASD").
For further information regarding management fees, 12b-1 fees and other
expenses of the Trust, including information regarding the basis upon which
management fees and 12b-1 fees are paid, see "Management of the Trust,"
"Distribution Plans" and "How To Buy Fund Shares" in this Prospectus and
"Management of the Trust" and "Distribution Plans" in the Statement of
Additional Information.
3
<PAGE>
II. FINANCIAL HIGHLIGHTS
The following information has been derived from financial statements of
the Funds which have been audited by Arthur Andersen LLP, independent public
accountants. Arthur Andersen LLP's report on the Trust's financial statements
as of December 31, 1994, appears in the Trust's Annual Report which is
incorporated by reference into the Statement of Additional Information. The
information listed below should be read in conjunction with the financial
statements contained in the Trust's Annual Report. Class B shares are a new
class of shares available only for Pioneer Cash Reserves Fund; no Financial
Highlights exist for Class B shares.
Pioneer Cash Reserves Fund
Selected Data for each Class A Share Outstanding For the Periods Presented
<TABLE>
<CAPTION>
For the Year Ended December 31,
June 22,
--------------------------------------------------------------------------
1987 to
December 31,
1994 1993 1992 1991 1990 1989
1988 1987
------- ------- ------- ------- ------- ------- -------
- ------------
<S> <C> <C> <C> <C> <C> <C>
<C> <C>
Net asset value,
beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00 $ 1.00
------ ------ ------ ------ ------ ------
- ------ ----------
Income from
investment
operations:
Net investment
income $ 0.03 $ 0.02 $ 0.03 $ 0.05 $ 0.07 $ 0.08 $
0.07 $ 0.03
Distributions to
shareholders
from:
Net investment
income (0.03) (0.02) (0.03) (0.05) (0.07) (0.08)
(0.07) (0.03)
------ ------ ------ ------ ------ ------
- ------ ----------
Net increase in
net asset value $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $
0.00 $ 0.00
------ ------ ------ ------ ------ ------
- ------ ----------
Net asset value,
end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00 $ 1.00
====== ====== ====== ====== ====== ======
====== ==========
Total return* 3.57% 2.47% 3.06% 5.29% 7.74% 8.80%
7.05% 3.48%
Ratio of net
operating
expenses to
average net
assets 0.50% 0.75% 0.81% 0.88% 0.75% 0.82%
0.78% 0.53%**
Ratio of net
investment
income to
average net
assets 2.59% 2.44% 3.03% 5.23% 7.53% 8.43%
6.91% 6.94%**
Net assets end
of period (in
thousands) $173,195 $64,841 $59,097 $73,010 $101,120 $80,121
$59,592 $34,756
Ratios assuming
no reduction of
fees or
expenses:
Net operating
expenses 0.65% 1.10% 1.01% + + +
0.91% 1.01%**
Net investment
income 2.44% 2.09% 2.82% + + +
6.77% 6.46%**
</TABLE>
Pioneer U.S. Government Money Fund
Selected Data for each Class A Share Outstanding For the Periods Presented
<TABLE>
<CAPTION>
April 11,
For the Year Ended December
31, 1988 to
--------------------------------------------------------------------------
December 31,
1994 1993 1992 1991 1990
1989 1988
--------- --------- --------- --------- --------- ---------
- -------------
<S> <C> <C> <C> <C> <C>
<C> <C>
Net asset value,
beginning of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00 $ 1.00
------- ------- ------- ------- ------- -------
- -----------
Income from
investment
operations:
Net investment
income $ 0.04 $ 0.03 $ 0.03 $ 0.05 $ 0.07 $
0.08 $ 0.05
Distributions to
shareholders
from:
Net investment
income (0.04) (0.03) (0.03) (0.05) (0.07)
(0.08) (0.05)
------- ------- ------- ------- ------- -------
- -----------
Net increase in
net asset value $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $
0.00 $ 0.00
------- ------- ------- ------- ------- -------
- -----------
Net asset value,
end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00 $ 1.00
======= ======= ======= ======= ======= =======
===========
Total return* 3.65% 2.63% 3.19% 5.41% 7.61%
8.80% 5.34%
Ratio of net
operating
expenses to
average net
assets 0.63% 0.55% 0.59% 0.60% 0.60%
0.53% 0.50%**
Ratio of net
investment
income to
average net
assets 3.64% 2.61% 3.15% 5.29% 7.37%
8.37% 7.52%**
Net assets end
of period
(in thousands) $29,101 $23,875 $23,619 $28,373 $27,828
$20,508 $9,503
Ratios assuming
no reduction of
fees or
expenses:
Net operating
expenses 1.08% 1.37% 1.24% 1.08% 0.80%
1.12% 1.13%**
Net investment
income 3.19% 1.79% 2.50% 4.81% 7.17%
7.77% 6.88%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all dividends and distributions, and the complete
redemption of the investment at the net asset value at the end of each
period.
** Annualized.
+ No reduction of fees or expenses in this period.
4
<PAGE>
Pioneer Tax-Free Money Fund
Selected Data for each Class A Share Outstanding For the Periods Presented
<TABLE>
<CAPTION>
April 11,
For the Year Ended December
31, 1988 to
---------------------------------------------------------------
December 31,
1994 1993 1992 1991 1990
1989 1988
------- ------- ------- ------- ------- -------
- ------------
<S> <C> <C> <C> <C> <C>
<C> <C>
Net asset value, beginning
of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00 $ 1.00
------ ------ ------ ------ ------
- ------ ----------
Income from investment
operations:
Net investment income $ 0.02 $ 0.02 $ 0.02 $ 0.04 $ 0.05 $
0.06 $ 0.04
Distributions to
shareholders from:
Net investment income (0.02) (0.02) (0.02) (0.04) (0.05)
(0.06) (0.04)
------ ------ ------ ------ ------
- ------ ----------
Net increase in net asset
value $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $
0.00 $ 0.00
------ ------ ------ ------ ------
- ------ ----------
Net asset value, end of
period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $
1.00 $ 1.00
====== ====== ====== ====== ======
====== ==========
Total return* 2.40% 1.92% 2.38% 4.00% 5.48%
6.06% 3.71%
Ratio of net operating
expenses to average net
assets 0.50% 0.50% 0.50% 0.50% 0.50%
0.50% 4.98%**
Ratio of net investment
income to average net
assets 2.34% 1.92% 2.33% 3.91% 5.37%
5.86% 5.13%**
Net assets end of period
(in thousands) $10,059 $8,114 $7,241 $7,539 $6,968
$5,351 $3,272
Ratios assuming no
reduction of fees or
expenses:
Net operating expenses 1.87% 1.85% 2.07% 1.08% 1.91%
2.27% 1.50%
Net investment income 0.97% 0.57% 0.77% 4.81% 3.96%
4.09% 4.13%**
</TABLE>
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all dividends and distributions, and the complete
redemption of the investment at the net asset value at the end of each
period.
** Annualized.
III. THE TRUST
Pioneer Cash Reserves Fund, Pioneer U.S. Government Money Fund and Pioneer
Tax-Free Money Fund are series of Pioneer Money Market Trust (the "Trust"),
an open-end, management investment company (commonly referred to as a mutual
fund) organized as a Massachusetts business trust on March 31, 1987 and
reorganized as a Delaware business trust on March 30, 1995. The Trust has
authorized an unlimited number of shares, which are currently organized into
these three series, and continuously offers its shares to the public. Under
normal conditions, each Trust must redeem shares upon the demand of any
shareholder. The Trustees have the authority, without shareholder approval,
to classify and reclassify the shares of the Funds or any new series of the
Trust. As of the date of this Prospectus, the Trustees have authorized the
issuance of a single class of shares for Pioneer U.S. Government Money Fund
and Pioneer Tax-Exempt Money Fund, designated Class A, and, for Pioneer Cash
Reserves Fund only, two classes of shares, designated Class A and Class B.
IV. THREE INVESTMENT PROGRAMS
The investment objective of Pioneer Cash Reserves Fund, Pioneer U.S.
Government Money Fund and Pioneer Tax-Free Money Fund is to provide high
current income, preservation of capital and liquidity through investments in
high-quality short-term securities.
Each of the three Funds seeks to maintain a constant net asset value of
$1.00 per share by investing in a portfolio of money market instruments
maturing within 397 days and with a dollar-weighted average maturity of 90
days or less.
There can be no guarantee that the Funds will achieve their investment
objective or that they will be able to maintain constant $1.00 net asset
values per share.
Suitability
The Funds are designed to provide a convenient way for individual,
corporate and institutional investors to earn income on their cash reserves,
with easy access to their money and stable principal value.
Ownership of shares of the Funds also eliminates the bookkeeping and
administrative inconvenience of purchasing money market securities directly.
Investment Policies
Pioneer Cash Reserves Fund invests in the following types of high-quality,
money market instruments:
5
<PAGE>
(1) U.S. Government Obligations: Marketable obligations issued or
guaranteed by the U.S. Government or any agency or instrumentality thereof.
(2) Bank Obligations: Obligations (including certificates of deposit and
bankers' acceptances) of U.S. banks (including their foreign branches) and
savings and loan associations which at the date of their latest public
reporting had total assets in excess of $1 billion, and obligations of
certain smaller banks and savings and loan institutions satisfying specified
investment criteria (see the Statement of Additional Information for further
details).
(3) Commercial Paper: Commercial paper (short-term unsecured promissory
notes of corporations, including variable amount master demand notes) which
at the date of investment is rated A-1 by Standard & Poor's Ratings Group
("S&P") or P-1 by Moody's Investors Service, Inc. ("Moody's"), or, if not
rated, is issued by companies having outstanding debt rated AAA or AA by S&P
or Aaa or Aa by Moody's. For further information concerning these fixed and
variable rate securities, see the description of Pioneer Tax-Free Money
Fund's investment policies below.
(4) Short-term Corporate Debt Securities: Corporate debt securities (bonds
and debentures) with no more than 397 days remaining to maturity at date of
settlement and rated AAA or AA by S&P or Aaa or Aa by Moody's.
Pioneer U.S. Government Money Fund invests exclusively in obligations
issued by or guaranteed as to principal and interest by the U.S. government
or any of its agencies or instrumentalities and in repurchase agreements
secured by these obligations. The government securities in which the Fund
invests may or may not be backed by the full faith and credit of the U.S.
government. U.S. Treasury notes, bills, certificates of indebtedness and
bonds, and certain obligations issued by government-sponsored agencies and
enterprises acting under the authority of Congress, are backed by the full
faith and credit of the U.S. government. Such obligations include, but are
not limited to, obligations issued by the Government National Mortgage
Association, the Farmers' Home Administration and the Small Business
Administration. The Fund may also invest in securities issued by government
agencies or instrumentalities (such as executive departments of the
government or independent federal organizations supervised by Congress) which
are supported by the right of the issuer to borrow from the U.S. Treasury or
by the credit of the agency, authority or instrumentality itself. Such
obligations include, but are not limited to, obligations issued by the
Tennessee Valley Authority, the Bank for Cooperatives, Federal Home Loan
Banks, Federal Intermediate Credit Banks and Federal Land Banks. The Fund may
also invest in obligations backed solely by the credit of the issuing agency
itself. There is no guarantee that the U.S. government would support such
securities and, accordingly, they may involve a risk of nonpayment of
principal and interest.
While the Fund may invest in any of the obligations described above, the
Fund generally intends, under normal circumstances and to the extent
practicable, to limit its investments to certain U.S. government obligations
the interest on which is generally exempt from state income taxes in order to
increase the percentage of the Fund's distributions attributable to such
interest and therefore exempt from such taxes in most states.
Pioneer Tax-Free Money Fund invests under normal conditions at least 80%
of its portfolio in debt securities issued by or on behalf of states,
territories and possessions of the United States and the District of Columbia
and their political subdivisions, agencies or instrumentalities, the interest
on which is exempt from federal income tax (hereafter called "tax-exempt
securities"). The Fund's investments are limited to:
(1) Tax-exempt securities, including (i) municipal bonds which are rated
AAA or AA by S&P or Aaa or Aa by Moody's,
(ii) tax anticipation notes, revenue anticipation notes and bond anticipation
notes, which are rated SP-1(plus) or SP-1 by S&P or MIG-1 or MIG-2 by Moody's
and (iii) tax-exempt commercial paper rated A-1 by S&P or P-1 by Moody's;
(2) Tax-exempt securities that are not rated but that, in the opinion of
PMC, are of at least comparable quality to the two highest grades of S&P or
Moody's; and
(3) Taxable obligations issued or guaranteed by the U.S. government or its
agencies or instrumentalities or taxable commercial paper rated A-1 or P-1.
The Fund may purchase tax-exempt securities carrying fixed rates of return
or having floating or variable interest rates. Floating and variable rate
obligations are generally more stable than fixed-rate obligations because
their value is less affected by changes in interest rate levels. The Fund's
investments may include certificates of participation, which are a type of
floating or variable rate obligation representing interests in a pool of
tax-exempt securities held by a bank or other financial institution.
In order to enhance the liquidity, stability or quality of a tax-exempt
security or to shorten its maturity, the Fund may
6
<PAGE>
acquire a right to sell the obligation to another party at a guaranteed price
approximating par value, either on demand or at specified intervals. The
right to sell may form part of the obligation or be acquired separately by
the Fund. These rights may be referred to as demand features or standby
commitments, depending on their characteristics, and may involve letters of
credit or other credit support arrangements supplied by domestic or foreign
banks supporting the other party's ability to purchase the obligation from
the Fund. In considering whether an obligation meets the Fund's quality
standards, the Fund may look to the creditworthiness of the party providing
the right to sell or to the quality of the obligation itself. Letters of
credit issued by foreign banks (for which there may be less public
information available) may involve certain risks such as future unfavorable
political and economic developments, currency controls or other governmental
restrictions which might affect payment by the bank. See the Statement of
Additional Information for further description of these risks.
The Fund intends to minimize the distribution of taxable income to
shareholders. Thus, the Fund's investments in taxable obligations are limited
to 20% of its assets and are intended only to meet short-term liquidity needs
during periods of unusually adverse market conditions. For a description of
how to compare yields on tax-exempt securities with yields on taxable
securities, see the Appendix to this Prospectus. Dividends distributed to
shareholders attributable to income or net gains from the sale of taxable and
tax-exempt securities will generally be taxable to shareholders as ordinary
income. See "Dividends, Distributions and Tax Status." However, the Fund has
no intention of investing in "private activity bonds" or other tax-exempt
securities whose interest is treated as a tax preference item resulting in
tax liability to shareholders subject to the alternative minimum tax.
Pioneer Tax-Free Money Fund may also purchase some tax-exempt securities
on a "when-issued" basis, which means that up to 60 days may pass before they
are delivered and paid for. The commitment to purchase a security for which
payment will be made at a future date may be deemed a separate security. The
purchase price and interest rate of "when-issued" securities is fixed at the
time the commitment to purchase is made. Although the amount of tax-exempt
securities for which there may be purchase commitments on a "when-issued"
basis is not limited, it is expected that under normal circumstances not more
than 10% of the total assets of the Fund will be committed to such purchases.
The Fund does not start earning interest on "when-issued" securities until
settlement is made. In order to invest the assets of the Fund immediately
while awaiting delivery of securities purchased on a "when-issued" basis,
short-term obligations that offer same-day settlement and earnings will
normally be purchased. Although short-term investments will normally be in
tax-exempt securities, short-term taxable securities may be purchased if
suitable short-term tax-exempt securities are not available.
When a commitment to purchase a security on a "when-issued" basis is
made, procedures are established consistent with the General Statement of
Policy of the SEC concerning such purchases. Because that policy currently
recommends that an amount of the Fund's assets equal to the amount of the
purchase be held aside or segregated to be used to pay for the commitment,
cash or high-quality debt securities sufficient to cover any commitments are
always expected to be available. However, although it is not intended that
such purchases would be made for speculative purposes, and although the Fund
intends to adhere to the provisions of the SEC policy, purchases of
securities on a "when-issued" basis may involve more risk than other types of
purchases. For example, when the time comes to pay for a "when-issued"
security, portfolio securities of the Fund may have to be sold in order for
the Fund to meet its payment obligations, and a sale of securities to meet
such obligations carries with it a greater potential for the realization of
capital gain, which is not tax-exempt. Also, if it is necessary to sell the
"when-issued" security before delivery, the Fund may incur a loss because of
market fluctuations since the time the commitment to purchase the
"when-issued" security was made. Moreover, any gain resulting from any such
sale would not be tax-exempt. Additionally, because of market fluctuations
between the time of commitment to purchase and the date of purchase, the
"when-issued" security may have a lesser (or greater) value at the time of
purchase than the Fund's payment obligations with respect to the security.
Additional Information
In addition to the foregoing policies each Fund is subject to certain
regulatory requirements. Each Fund may purchase only securities that PMC
believes present minimal credit risks and that are rated by the major rating
agencies, such as S&P and Moody's, within the two highest rating categories
for short-term debt obligations or, if unrated, are determined to be of
equivalent quality by PMC. If a security has been assigned different ratings
by different rating agencies,
7
<PAGE>
at least two rating agencies must have assigned the highest rating in order
for PMC to rely on that highest rating.
Pioneer Cash Reserves Fund may not invest more than 5% of its total assets
(taken at amortized cost) in securities issued by or subject to puts from any
one issuer (except U.S. Government Securities and repurchase agreements
collateralized by such securities). With respect to 75% of its total assets,
Pioneer Tax-Free Money Fund may not invest more than 5% of its assets in
securities subject to puts from the same institution. Pioneer Cash Reserves
Fund and Pioneer U.S. Government Money Fund will not invest more than 5% of
their respective total assets in securities that, although of high quality,
have not been rated in the highest short-term rating category by at least two
rating agencies (or if rated by only one rating agency, by that rating agency
or, if unrated, determined to be of equivalent quality by PMC), provided that
within this 5% limitation, neither Fund will invest more than the greater of
1% or $1 million of its total assets in the securities (other than U.S.
Government securities) of any one issuer.
Each of the Funds may enter into repurchase agreements with approved banks
and broker-dealers for periods not to exceed seven days and only with respect
to U.S. government securities that throughout the period have a value at
least equal to the amount of the loan (including accrued interest). However,
Pioneer U.S. Government Money Fund does not intend to engage in repurchase
agreements as long as the income from such agreements continues to be
generally subject to state income taxes.
The Funds will not invest more than 25% of their assets in any one
industry, except that there is no percentage limitation on investments in
bank obligations or U.S. Government obligations.
The Funds intend to hold their investments until maturity, but may sell
them prior to maturity for a number of reasons, including: to shorten or
lengthen the average maturity; to increase the yield; to maintain the quality
of the portfolio; or to maintain a stable share value.
It is the policy of the Funds not to engage in trading for short-term
profits. The Funds will engage in portfolio trading if PMC believes that a
transaction net of costs (including custodian's fees) will contribute to the
achievement of the Trust's investment objective.
The Funds have no present plans to change their policies with regard to
the types or maturities of securities in which they invest. However, if the
Funds determine that their investment objective can best be achieved by a
change in investment policy or strategy, the Funds may make such changes
without shareholder approval by disclosing them in the Prospectus. The Funds'
investment objective may not be changed without shareholder approval.
The investment characteristics of U.S. government obligations, bank
obligations, commercial paper, repurchase agreements and tax-exempt
securities are described in greater detail in the Appendix to this
Prospectus. The Statement of Additional Information also provides more
information on the above investment strategies, as well as information on
additional investment restrictions, including those which may not be changed
without shareholder approval.
V. FUND SHARE ALTERNATIVES
Pioneer U.S. Government Money and Pioneer Tax-Free Money Fund offer only
one Class of shares, designated as Class A shares. Pioneer Cash Reserves
Fund, however, continuously offers two Classes of shares designated as Class
A and Class B shares. If you do not specify in your instructions to the Fund
which Class of shares you wish to purchase, exchange or redeem, the Fund will
assume that your instructions apply to Class A shares. See "How to Buy Fund
Shares" for more information on classes of shares.
Class A Shares. Class A shares are offered by each Fund. Class A shares
may be purchased at net asset value without a sales charge or commission and
are subject to distribution and service fees at a combined annual rate of up
to 0.15% of the Fund's average daily net assets attributable to Class A
shares.
Class B Shares. Class B shares are offered by Pioneer Cash Reserves Fund
only. If your investment in Pioneer Cash Reserves Fund is for the long-term,
Class A shares may be more appropriate than Class B shares. Purchases of the
Class B shares of Pioneer Cash Reserves Fund may be appropriate if you plan
to exchange these shares for the Class B shares of another Pioneer mutual
fund (except Pioneer Short-Term Income Trust or Pioneer Intermediate Tax-Free
Fund, which have lower CDSCs for their Class B shares). Please consult your
investment representative.
Class B shares are sold without an initial sales charge, but are subject
to a contingent deferred sales charge
8
<PAGE>
("CDSC") of up to 4% if redeemed within six years. Class B shares are subject
to distribution and service fees at a combined annual rate of 1.00% of the
Fund's average daily net assets attributable to Class B shares. Your entire
investment in Class B shares is available to work for you from the time you
make your investment, but the higher distribution fee paid by Class B shares
will cause your Class B shares (until conversion) to have a higher expense
ratio and to pay lower dividends, to the extent dividends are paid, than
Class A shares. Class B shares will automatically convert to Class A shares,
based on relative net asset value, eight years after the initial purchase.
Investment dealers or their representatives may receive different
compensation depending on which Class of shares they sell. Shares may be
exchanged only for shares of the same Class of another Pioneer fund and
shares acquired in the exchange will continue to be subject to any CDSC
applicable to the shares of the Fund originally purchased. 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.
VI. SHARE PRICE
The purchase and redemption price of each Fund's shares is equal to the net
asset value ("NAV") per share. The NAV per share of a Class of a Fund is
determined by dividing the value of its assets, less liabilities (expenses and
fees are accrued daily) attributable to that Class, by the number of shares of
that Class outstanding. Each Fund's NAV is computed twice daily, on each day the
New York Stock Exchange (the "Exchange") is open, at 12:00 noon Eastern Time and
as of the close of regular trading on the Exchange.
Securities are valued at amortized cost. Under the amortized cost pricing
method, a portfolio investment is valued at its cost and, thereafter, any
discount or premium is amortized to maturity, regardless of the impact of
fluctuating interest rates on the market value of the investment. Amortized
cost pricing facilitates the maintenance of a $1.00 constant NAV per share,
but, of course, this cannot be guaranteed. All assets of each 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.
VII. HOW TO BUY FUND SHARES
You may buy Fund shares through broker-dealers who have selling agreements
with the Trust's distributor, Pioneer Funds Distributor, Inc. (" PFD"). Class A
shares may also be purchased directly from PFD. Call Pioneering Services Company
("PSC") at 1-800-225-6292 if you need assistance.
The minimum initial investment is $1,000 for Class A and Class B shares
except as specified below. The minimum initial investment is $50 for Class A
accounts being established to utilize monthly bank drafts, government
allotments, payroll deduction and other similar automatic investment plans.
Separate minimum investment requirements apply to retirement plans and to
telephone and wire orders placed by broker-dealers; no sales charges or
minimum requirements apply to the reinvestment of dividends or capital gains
distributions.
The minimum subsequent investment is $100 for Class A shares and $500 for
Class B shares except that the subsequent minimum investment amount for Class
B share accounts may be as little as $100 if an automatic investment plan is
established (see "Automatic Investment Plans").
Dividends on Purchases. Each Fund seeks to be fully invested at all times
in order to accrue dividends to your account each day. To be eligible for
each day's dividend accrual, each direct purchase of shares in the Funds must
be converted to same day funds. Same day funds are monies credited to State
Street Bank and Trust Company's ("State Street Bank") account with the
Federal Reserve Bank of Boston.
If your purchase order is received in good order and accepted by the Fund
by 12:00 noon Eastern Time, it will be executed at the NAV next determined
after your purchase payment is converted into same day funds or other
immediately available funds and your shares will begin earning dividends that
day. If your purchase order is received in good order and accepted after
12:00 noon Eastern Time and prior to the close of the Exchange (usually, 4:00
p.m. Eastern Time), it will be executed at the NAV next determined after your
purchase payment is converted into same day funds or other immediately
available funds and your shares will begin earning dividends on the next
business day. When you purchase shares by check, your shares will begin
earning dividends when the check is converted into same day funds, normally
within two business days.
On any day that State Street Bank, the Custodian or the Exchange closes
early, or, in the PMC's judgment closing
9
<PAGE>
early is in the best interest of the Trust's shareholders, the Trust reserves
the right to advance the time by which transactions (purchases, sales or
exchanges) must be received in order to be eligible for that day's dividends.
Making Your Investment
All purchases of Class B shares, except exchanges from other Pioneer
mutual funds, can only be processed through broker-dealers who have selling
agreements with PFD.
By Mail. (Class A shares only) Send your check or negotiable bank draft,
drawn on a U.S. bank and payable in U.S. dollars to the Fund in which you
would like to purchase shares, to PSC at the above address. Cash will not be
accepted. Your payment should be accompanied by a completed new account
application or other instructions indicating your account number.
If you pay by check or draft, State Street Bank will normally make same
day funds available to the Trust, and the Trust will accept the order, on the
first business day after receipt. Checks drawn on some other banks may take
more than one day to be collected and share purchases will not be made until
same day funds are available to the Trust.
By Telephone. Your account is automatically authorized to have the
telephone purchase privilege unless you indicated otherwise on your Account
Application or by writing to PSC. The telephone purchase option may be used
to purchase additional shares for an existing fund account; it may not be
used to establish a new account. Proper account identification will be
required for each telephone purchase. A maximum of $25,000 per account may be
purchased by telephone each day. The telephone purchase privilege is
available to IRA accounts but may not be available to other types of
retirement plan accounts. Call PSC for more information.
You are strongly urged to consult with your financial representative prior
to requesting a telephone purchase. To purchase shares by telephone, you must
establish your bank account of record by completing the appropriate section
of your Account Application or an Account Options Form. Pioneer will
electronically debit the amount of each purchase from this predesignated bank
account. Telephone purchases may not be made for 30 days after the
establishment of your bank of record or any change to your bank information.
Telephone purchases will be priced at the net asset value plus any
applicable sales charge next determined after PSC's acceptance of a telephone
purchase instruction and receipt of good funds (usually three days after the
purchase instruction). You may always elect to deliver purchases to PSC by
mail. See "Telephone Transactions and Related Liabilities" for additional
information.
By Wire. (Class A shares only) When you wish to wire money to an existing
Pioneer account, call PSC at 1-800- 255-6292 to obtain complete instructions.
You will be asked to instruct your bank to transmit same day funds by wire
through the Federal Reserve banking system. The wiring instructions must
include the following information:
Receiving Bank State Street Bank and Trust Company
Address 225 Franklin Street
Boston MA 02101
ABA Transit 011000028
For Further Credit To Shareholder Name
Existing Pioneer Account #
Name of Pioneer Fund
Federal funds directed to the Custodian must be pre- approved by calling
PSC at 1-800-255-6292. To be sure that a bank wire is accepted on the same
day it is sent, you should give the Trust notice of your intention to make
such investment as early in the day as possible since the process of making a
wire transfer may take several hours and may be affected by your bank's
internal procedures concerning wire transfers. Your bank may charge for
sending same day funds on your behalf. State Street Bank presently does not
charge for receipt of wired same day funds, but reserves the right to charge
for this service in the future.
Selecting a Class of Shares
Class A Shares. Each Fund offers Class A shares at net asset value without
the imposition of an initial sales charge by mail, by telephone or by wire as
described above.
Class B Shares. Class B shares are offered only by Pioneer Cash Reserves
Fund. You may buy Class B shares at NAV without the imposition of an initial
sales charge; however, Class B shares redeemed within six years of purchase
will be subject to a CDSC at the rates shown in the table below. The charge
will be assessed on the amount equal to the lesser of the current market
value or the original purchase cost of the shares being redeemed. No CDSC
will be imposed on increases in account value above the initial purchase
price, including shares derived from the reinvestment of dividends or capital
gains distributions. The amount of the CDSC, if any, will vary depending on
the number of years from the time of purchase until
10
<PAGE>
the time of redemption of Class B shares. For the purpose of determining the
number of years from the time of any purchase, all payments during a quarter
will be aggregated and deemed to have been made on the first day of that
quarter. In processing redemptions of Class B shares, the Fund will first
redeem shares not subject to any CDSC, and then shares held longest during
the six-year period. As a result, you will pay the lowest possible CDSC.
CDSC as a Percentage of Dollar
Year Since Purchase Amount Subject to CDSC
First 4.0%
Second 4.0%
Third 3.0%
Fourth 3.0%
Fifth 2.0%
Sixth 1.0%
Seventh and thereafter none
Class B shares will automatically convert into Class A shares at the end
of the calendar quarter that is eight years after the purchase date, except
as noted below. Class B shares acquired by exchange from Class B shares of
another Pioneer fund will convert into Class A shares based on the date of
the initial purchase and will be subject to the CDSC applicable to the shares
of the fund originally purchased. Class B shares acquired through
reinvestment of distributions will convert into Class A shares based on the
date of the initial purchase to which such shares relate. For this purpose,
Class B shares acquired through reinvestment of distributions will be
attributed to particular purchases of Class B shares in accordance with such
procedures as the Trustees may determine from time to time. The conversion of
Class B shares to Class A shares is subject to the continuing availability of
a ruling from the Internal Revenue Service, which the Fund has obtained, or
an opinion of counsel that such conversions will not constitute taxable
events for federal tax purposes. There can be no assurance that such ruling
will continue to be in effect at the time any particular conversion would
occur. The conversion of Class B shares to Class A shares will not occur if
such ruling is no longer available and, therefore, Class B shares would
continue to be subject to higher expenses than Class A shares for an
indeterminate period.
Waiver or Reduction of Contingent Deferred Sales Charge. The CDSC on Class
B shares and on any Class A shares subject to a CDSC may be waived or reduced
for non-retirement account 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 limited automatic
redemptions as set forth in "Systematic Withdrawal Plans" (limited in any
year to 10% of the value of the account in the Fund at the time the
withdrawal plan is established).
The CDSC on Class B shares and on any Class A 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 Internal Revenue Code of 1986, as amended (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 Individual Retirement Account ("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
11
<PAGE>
this privilege has been pre-authorized through a prior agreement with PFD
regarding participant directed transfers).
The CDSC on Class B shares and on any Class A 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 company; or (b) the
redemption is made pursuant to each Fund's right to liquidate or
involuntarily redeem shares in a shareholder's account.
Broker-Dealers. Pioneer Cash Reserve Fund's Class B shares may only be
purchased through a securities broker or dealer. You may purchase Class A
shares of any Fund in the Trust through a securities broker or dealer or
directly from PFD. A broker or dealer may charge for this service. If you do
not have a securities broker or dealer, PSC can refer you to one.
An order for either Class of Fund shares received by PFD from a
broker-dealer prior to either 12:00 noon Eastern Time or the close of regular
trading on the Exchange is confirmed at the price appropriate for that Class
next determined after the order is received. It is the responsibility of
broker-dealers to transmit orders so that they will be received by PFD prior
to either 12:00 noon Eastern Time or its close of business (usually 5:30 p.m.
Eastern Time).
General. 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.
Conditions of Purchase. The Trust reserves the right to reject any
purchase or exchange. If a purchase is canceled because your check is
returned unpaid, you are responsible for any loss the Trust incurs and a
separate charge may be made for any unpaid check. The Trust may redeem shares
from your account(s) to cover these costs and charges and you may be
restricted from making future purchases of shares of any of the Pioneer
mutual funds.
VIII. HOW TO SELL FUND SHARES
You can arrange to sell (redeem) Fund shares on any day the Exchange is
open by selling either some or all of your shares to the Fund by mail, by
telephone, by facsimile ("fax"). Class A share accounts may also sell by
check when properly authorized in advance.
You may sell your shares either through your broker-dealer or directly to
the Fund. Please note the following:
(bullet) If you are selling shares from a retirement account, you must make
your request in writing (except for exchanges to other Pioneer
mutual funds which can be requested by phone or in writing). Call
1-800- 622-0176 for more information.
(bullet) If you are selling shares from a non-retirement account, you may use
any of the methods described below.
Your shares will be sold at the share price next calculated (expected to
be a constant $1.00) after your order is received and accepted, less any
applicable CDSC. Subject to the limitation described above for shares
purchased by check, sale proceeds are normally mailed or wired the next
business day but in any event not later than seven days after your order is
accepted. The Fund reserves the right to withhold payment of the sale
proceeds until checks received by the Fund in payment for the shares being
sold have cleared, which may take up to 15 calendar days from the purchase
date.
By Check. (Class A Shares Only) If requested, each Fund will establish a
checking account for a Class A shareholder(s) with The First National Bank of
Omaha (the "First National Bank"). Please allow 1 to 2 weeks for receipt of
your supply of personalized checks. Checks may be drawn for not less than
$500 nor more than $250,000, payable to anyone. When a check is presented to
First National Bank for payment, it will cause the Fund to redeem at the net
asset value next determined a sufficient number of the shareholder's shares
to cover the check. A shareholder receives the daily dividends declared on
his or her shares until the day the check clears.
The checking account will be subject to First National Bank's rules and
regulations governing checking accounts. If there is an insufficient number
of shares in a shareholder's account when a check is presented to First
National Bank for payment, the check will be returned. Since the aggregate
value of a shareholder's account in each Fund changes each day because of the
daily dividend, a shareholder should not attempt to withdraw the full amount
in his or her account by using a check. The checkwriting privilege is not
available for Class B share accounts. In addition, checkwriting is generally
not avail-
12
<PAGE>
able for retirement plan accounts or accounts subject to backup withholding
(see "Dividends, Distributions and Tax Status" and "Voluntary Tax
Withholding").
In Writing. You may sell your shares by delivering a written request
signed by all registered owners and in good order to PSC, at P.O. Box 9014
Boston, MA 02205-9014, however, you must use a written request, including a
signature guarantee, to sell your shares if any of the following situations
applies:
(bullet) you wish to sell over $50,000 worth of shares,
(bullet) your account registration or address has changed within the last 30
days,
(bullet) the check is not being mailed to the address on your account
(address of record),
(bullet) the check is not being made out to the account owners, or
(bullet) the sale proceeds are being transferred to a Pioneer account with a
different registration.
Your request should include your name, the Fund's name, your fund account
number, the Class of shares to be redeemed, the dollar amount or number of
shares to be redeemed, and any other applicable requirements as described
below. Unless instructed otherwise, Pioneer will send the proceeds of the
sale to the address of record. Fiduciaries or corporations are required to
submit additional documents. For more information, contact PSC at
1-800-225-6292.
Written requests will not be accepted until they are received in good
order by PSC. Good order means that there are no outstanding claims or
requests to hold redemptions on the account, certificates are endorsed by the
record owner(s) exactly as the shares are registered and the signature(s) are
guaranteed by an eligible guarantor. You should be able to obtain a signature
guarantee from a bank, broker, dealer, credit union (if authorized under
state law), securities exchange or association, clearing agency or savings
association. A notary public cannot provide a signature guarantee. Signature
guarantees are not accepted by facsimile (fax). The Trust may waive the
signature guarantee requirement for redemption requests of $50,000 or less
provided that the redemption proceeds are directed to the shareholder(s) of
record at the address of record.
By Telephone or by Fax. Your account is automatically authorized to have
the telephone redemption privilege unless you indicated otherwise on your
Account Application or by writing to the Fund. You may redeem up to $50,000
of your shares by telephone or fax and receive the proceeds by check or bank
wire or electronic funds transfer. The redemption proceeds must be made
payable exactly as the account is registered. To receive the proceeds by
check: 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 or by
electronic funds transfer: the proceeds must be sent to your bank address of
record which must have been properly pre-designated 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. The telephone redemption option is not available to
retirement plan accounts. You may always elect to deliver redemption
instructions to PSC by mail. See "Telephone Transactions and Related
Liabilities" below. Telephone and fax redemptions will be priced as described
above. You are strongly urged to consult with your financial representative
prior to requesting a telephone redemption.
A redemption order received by telephone or fax in proper form by PMC
before 12:00 noon Eastern Time on any business day becomes effective as of
12:00 noon that day, and shares so redeemed will not receive that day's
dividend. A redemption order received by telephone or fax in proper form by
PSC after 12:00 noon Eastern Time and prior to the close of the Exchange
(usually, 4:00 p.m. Eastern Time) on any business day becomes effective as of
4:00 p.m. that day, and shares so redeemed will receive that day's dividend.
In either case, proceeds of such a redemption will normally be mailed or
wired the next business day. State Street Bank charges a fee for wiring
funds; the fee will be deducted from the amount redeemed.
Selling Shares Through Your Broker-Dealer. The Fund has authorized PFD to
act as its agent in the repurchase of shares of the Fund from qualified
broker-dealers and reserves the right to terminate this procedure at any
time. Your broker-dealer must receive your request and transmit it to PFD
either by 12:00 noon Eastern Time or before PFD's close of business to
receive the next determined redemption price. Your broker-dealer is
responsible for providing all necessary documentation to PFD and may charge
you for its services.
Redemption Through Compatible Computer Facilities. Certain broker-dealers
or other institutions may be able to
13
<PAGE>
redeem shares through compatible computer facilities. Contact PSC at
1-800-225-6292 to determine whether your computer facilities are compatible
and to receive further instructions. The proceeds of redemption requests
received through compatible computer facilities before 12:00 noon Eastern
Time will normally be transmitted in Federal Funds on the same day and those
shares will not receive the dividend declared on that business day.
Small Accounts. The minimum account value is $500. If you hold shares of a
Fund in an account with a net asset value of less than the minimum required
amount due to 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 the minimum required amount within six
months of notice by the Fund to you of the Fund's intention to redeem the
shares.
General. The Trust and First National Bank each reserve the right at any
time to terminate, suspend or change the terms of or impose fees on any
redemption method described in this Prospectus, except redemption by mail.
Redemptions may be suspended or payment postponed during any period in which
any of the following conditions exist: the Exchange is closed or trading on
the Exchange is restricted; an emergency exists as a result of which disposal
by a Fund of securities owned by it is not reasonably practicable or it is
not reasonably practicable for a Fund to fairly determine the value of the
net assets of its portfolio; or the SEC, by order, so permits.
IX. HOW TO EXCHANGE FUND SHARES
Written Exchanges. You may exchange your shares by sending a letter of
instruction to PSC. Your letter should include your name, the name of the
Fund out of which you wish to exchange and the name of the Fund into which
you wish to exchange, your fund account number(s), the Class of shares to be
exchanged and the dollar amount or number of shares to be exchanged. Written
exchange requests must be signed by all record owner(s) exactly as the shares
are registered.
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 the Fund. Proper account identification will be
required for each telephone exchange. Telephone exchanges may not exceed
$500,000 per account per day. Each voice-requested or FactFone telephone
exchange request will be recorded. You are strongly urged to consult with
your financial representative prior to requesting a telephone exchange. See
"Telephone Transactions and Related Liabilities" below.
Automatic Exchanges. You may automatically exchange shares from one
Pioneer account for shares of the same Class in another Pioneer account on a
monthly or quarterly basis. The accounts must have identical registrations
and the originating account must have a minimum balance of $5,000. The
exchange will be effective on the 18th day of the month.
General. Exchanges must be at least $1,000. Shares of any of the Funds in
the Trust acquired through an exchange from another Pioneer mutual fund or
through reinvestment of dividends or capital gains distributions, may be
exchanged at net asset value for the same class of shares in any other
Pioneer mutual fund. Shares of any Fund of the Trust acquired by direct
purchase may be exchanged for the same class of any other Pioneer mutual fund
at net asset value plus any applicable sales charge. Not all Pioneer funds
offer more than one Class of shares. A new Pioneer account opened through an
exchange must have a registration identical to that on the original account.
Class A or Class B shares which would normally be subject to a CDSC upon
redemption will not be charged the applicable CDSC at the time of an
exchange. Shares acquired in an exchange will be subject to the CDSC of the
shares originally held. For purposes of determining the amount of any
applicable CDSC, the length of time you have owned the shares acquired by
exchange will be measured from the date you acquired the original shares and
will not be affected by any subsequent exchange.
Exchange requests received by PSC before 12:00 noon Eastern Time will be
effective at 12:00 noon if the requirements above have been met and they will
not be eligible for that day's dividend. Exchange requests received by PSC
after 12:00 noon and before 4:00 p.m. Eastern Time will be effective at 4:00
p.m. if the requirements above have been met and they will be eligible for
that day's dividend. PSC will process exchanges only after receiving an
exchange request in good order. There are currently no fees or sales charges,
other than those described above, imposed at the time of an exchange. An
exchange of shares may be made only in states where legally permitted. For
federal and (generally) state income tax purposes,
14
<PAGE>
an exchange is considered to be a sale of the shares of the Fund exchanged
and a purchase of shares in another Pioneer mutual 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. Shareholders will be given 60 days notice prior to any
termination or change which materially limits the existing exchange
privilege.
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. To prevent abuse of the exchange privilege to the
detriment of other Fund shareholders, the Trust and PFD reserve the right to
limit the number and/or frequency of exchanges and/or to charge a fee for
exchanges. The exchange privilege may be changed or discontinued and may be
subject to additional limitations, including certain restrictions on
purchases by market timer accounts.
X. DISTRIBUTION PLANS
The Trust, on behalf of the Funds, has adopted a Plan of Distribution for
Class A shares ("Class A Plan") and, on behalf of Pioneer Cash Reserves Fund,
for Class B shares ("Class B Plan") 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.
Pursuant to the Class A Plan, the Fund reimburses PFD its actual
expenditures to finance any activity primarily intended to result in the sale
of Class A shares or to provide services to holders of Class A shares,
provided the categories of expenses for which reimbursement is made are
approved by the Fund's Board of Trustees. As of the date of this Prospectus,
the Board of Trustees has approved the following categories of expenses for
Class A shares of the Fund: (i) a service fee to be paid to qualified
broker-dealers in an amount not to exceed 0.15% per annum of the Fund's daily
net assets attributable to Class A shares and (ii) reimbursement to PFD for
expenses incurred in providing services to Class A shareholders and
supporting broker-dealers and other organizations (such as banks and trust
companies) in their efforts to provide such services. 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 Class A Plan are accrued daily
and may not exceed 0.15% of the Fund's average daily net assets attributable
to Class A shares. Distribution expenses of PFD are expected to substantially
exceed the distribution fees paid by the Fund in a given year. The Class A
Plan 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.
The Class B Plan provides that the Fund will pay a distribution fee at the
annual rate of 0.75% of the Fund's average daily net assets attributable to
Class B shares and will pay PFD a service fee at the annual rate of 0.25% of
the Fund's average daily net assets attributable to Class B shares. The
distribution fee is intended to compensate PFD for its distribution services
to the Fund. The service fee is intended to be additional compensation for
personal services and/or account maintenance services with respect to Class B
shares. PFD also receives the proceeds of any CDSC imposed on the redemption
of Class B shares.
Commissions of 4%, equal to 3.75% of the amount invested and a first
year's service fee equal to 0.25% of the amount invested in Class B shares,
are paid to broker-dealers who have selling agreements with PFD. PFD may
advance to dealers the first year service fee at a rate up to 0.25% of the
purchase price of such shares and, as compensation therefore, PFD may retain
the service fee paid by the Fund with respect to such shares for the first
year after purchase. Dealers will become eligible for additional service fees
with respect to such shares commencing in the 13th month following the
purchase. Dealers may from time to time be required to meet certain criteria
in order to receive service fees. PFD or its affiliates are entitled to
retain all service fees payable under the Class B Plan for which there is no
dealer of record or for which qualification standards have not been met as
partial consideration for personal services and/or account maintenance
services performed by PFD or its affiliates for shareholder accounts.
XI. DIVIDENDS, DISTRIBUTIONS AND TAXATION
Each Fund of the Trust has elected to be treated, has qualified and
intends to qualify each year as a "regulated investment company" under
Subchapter M of the Code so that it will not pay federal income taxes on
income and capital gains distributed to shareholders at least annually. Under
the Code, a Fund will be subject to a nondeductible 4% fed-
15
<PAGE>
eral excise tax on a portion of its undistributed ordinary income and capital
gains if it fails to meet certain distribution requirements with respect to
each calendar year. Each Fund intends to make distributions in a timely
manner and accordingly does not expect to be subject to the excise tax.
At 4:00 p.m. Eastern Time each business day, each Fund will declare
substantially all of its net investment income (consisting of earned interest
income less expenses) as a dividend to its shareholders of record as of 12:00
noon Eastern Time. Shareholders begin earning dividends on the first business
day after a Fund is credited with same day funds. However, investors whose
payments are wired to and received by the Trust's Custodian in federal funds
by 12:00 noon, Eastern Time, will receive the dividend declared that day.
Unless you specify otherwise on your Account Application, all distributions
will be automatically reinvested in additional full and fractional shares of
the same class of the Fund in which you hold shares.
Each month's distributions from net investment income will be paid on the
last business day of the month. Short-term capital gains distributions, if
any, may be paid with the daily dividend. For federal income tax purposes,
all distributions will normally be taxable to shareholders of Pioneer Cash
Reserves Fund and Pioneer U.S. Government Money Fund as ordinary income,
whether taken in cash or reinvested in shares. Dividends and capital gains
distributions may also be made at such times as may be necessary to avoid
federal income or excise tax under the Code.
The Code permits tax-exempt interest received by Pioneer Tax-Free Money
Fund to flow through as tax-exempt "exempt interest dividends" to the Fund's
shareholders, provided that at least 50% of the value of the total assets of
the Fund at the close of each quarter of its taxable year consists of tax-
exempt obligations. Although Pioneer Tax-Free Money Fund does not intend to
invest in private activity bonds or other tax-exempt securities generating
interest that is treated as a tax preference item for individuals subject to
the federal alternative minimum tax, all tax-exempt distributions of the Fund
may affect a corporate shareholder's liability for such tax. Distributions of
income from certain investment activities of Pioneer Tax-Free Money Fund,
such as repurchase agreements, may be taxable.
Interest on indebtedness incurred by a shareholder of Pioneer Tax-Free
Money Fund to purchase or carry shares of the Fund will generally not be
deductible for federal income tax purposes. The Fund may also not be an
appropriate investment for persons who are "substantial users" of facilities
financed by private activity bonds or persons related to substantial users.
Shareholders receiving social security or certain railroad retirement
benefits may be subject to federal income tax on a portion of such benefits
as a result of receiving investment income, including exempt-interest
dividends and other distributions paid by the Fund.
While Pioneer Tax-Free Money Fund seeks to maximize the percentage of
income distributed which is not subject to federal income taxes, it is
possible that under certain circumstances (see "Investment Policies") a small
portion of the income dividends paid by the Fund will be subject to federal
income tax.
Taxable dividends and other taxable distributions which are paid to
individuals and other non-exempt payees will be subject to a 31% backup
withholding of federal income tax if a Fund is not provided with the
shareholder's correct taxpayer identification number and certification that
the number is correct and that the shareholder is not subject to backup
withholding or the Fund receives notice from the IRS or a broker that
withholding applies. Please refer to the Account Application for additional
information.
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, estates and trusts and who are subject to
U.S. federal income tax. In many states, the portion of the dividends paid by
Pioneer U.S. Government Money Fund or Pioneer Cash Reserves Fund that is
attributable to the interest received from certain U.S. Government
obligations will be exempt from state income taxation. Further, in some
states, exempt-interest dividends received from Pioneer Tax-Free Money Fund
may be exempt from state income taxation to the extent such dividends are
attributable to interest on obligations issued by the particular state or its
political subdivisions, agencies of instrumentalities. In some cases, state
income tax rules that apply to such distributions may condition either of
these exemptions on certain concentration, designation, reporting or other
requirements, and these Funds will not necessarily satisfy all such
requirements in all states. Non-U.S. shareholders and tax-exempt shareholders
are subject to different tax treatment that is not described above. You
should consult your own tax adviser regarding applicable state, local and
other tax laws. Information as to the federal tax
16
<PAGE>
status of distributions will be provided to shareholders annually.
XII. MANAGEMENT OF THE TRUST
The Trust's Board of Trustees has overall responsibility for management
and supervision of the Funds. There are currently eight Trustees, six of whom
are not "interested persons" of the Trust as defined in the 1940 Act. The
Board meets at least quarterly. By virtue of the functions performed by PMC,
the Trust 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 Trust.
The Trust is managed under a contract with PMC. PMC serves as investment
adviser to the Trust and is responsible for the overall management of the
Trust's business affairs, subject to the authority of the Board of Trustees.
PMC is a wholly-owned subsidiary of The Pioneer Group, Inc. ("PGI"), a
Delaware corporation.
In addition to the three Funds that make up the Trust, 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 PGI's
executive offices are located at 60 State Street, Boston, Massachusetts
02109.
Under the terms of its contract with the Trust, PMC assists in the
management of the Trust and is authorized in its discretion to buy and sell
securities for the account of each Fund in the Trust. PMC pays all the
expenses, including executive salaries and the rental of certain office
space, related to its services for the Trust, with the exception of the
following which are paid by the Trust: (a) charges and expenses for fund
accounting, pricing and appraisal services and related overhead, including,
to the extent such services are performed by personnel of PMC or its
affiliates, office space and facilities and personnel compensation, training
and benefits; (b) the charges and expenses of auditors; (c) the charges and
expenses of any custodian, transfer agent, plan agent, dividend disbursing
agent and registrar appointed by the Trust with respect to a Fund; (d) issue
and transfer taxes, chargeable to a Fund in connection with securities
transactions to which the Fund is a party; (e) insurance premiums, interest
charges, dues and fees for membership in trade associations, and all taxes
and corporate fees payable by a Fund to federal, state or other governmental
agencies; (f) fees and expenses involved in registering and maintaining
registrations of each Fund and/or its shares with the SEC, individual states
or blue sky securities agencies, territories and foreign countries, including
the preparation of Prospectuses and Statements of Additional Information for
filing with the SEC; (g) all expenses of shareholders' and Trustees' meetings
and of preparing, printing and distributing prospectuses, notices, proxy
statements and all reports to shareholders and to governmental agencies; (h)
charges and expenses of legal counsel to the Fund and the Trustees; (i)
distribution fees paid by the Fund in accordance with Rule 12b-1 promulgated
by the SEC pursuant to the 1940 Act; (j) compensation of those Trustees of
the Trust who are not affiliated with or interested persons of PMC, the Trust
(other than as Trustees), PGI or PFD; (k) the cost of preparing and printing
share certificates; and (l) interest on borrowed money, if any. In addition
to the expenses described above, the Trust shall pay all brokers' and
underwriting commissions chargeable to the Trust in connection with
securities transactions to which a Fund is a party.
Orders for each 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 the Trust or other Pioneer funds. 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 0.40% per annum of each
Fund's average daily net assets. The fee is normally computed daily and paid
monthly. PMC has voluntarily and temporarily agreed to reduce its management
fees for each Fund and to make other arrangements as may be necessary to keep
such expenses below specified levels. See "Expense Information."
During the fiscal year ended December 31, 1994, Pioneer Cash Reserves
Fund, Pioneer U.S. Government Money Fund and Pioneer Tax-Free Money Fund
incurred actual expenses of $1,117,021, $324,626 and $167,214, respectively,
before management fees, paid or payable to PMC, and other expenses were
reduced pursuant to PMC's voluntary expense limitation agreement in effect
through December
17
<PAGE>
31, 1994, as described further in the Statement of Additional Information.
John F. Cogan, Jr., Chairman of the Board and President of the Trust and
President and a Director of PGI and of PMC, owned approximately 15% of the
outstanding capital stock of PGI as of January 31, 1995. PMC is a wholly-
owned subsidiary of PGI.
XIII. DESCRIPTION OF SHARES AND VOTING RIGHTS
The shares of the Trust are divided into three series. Each share
represents an equal proportionate interest in a Fund with each other share.
The Trust reserves the right to create and issue additional series of shares
in addition to the three Funds currently available. The shares of a series
participate equally in the earnings, dividends and assets of the particular
series, except to the extent the rights of a particular class of shares may
differ from those of another class or classes. As of the date of this
Prospectus, the Trustees have authorized the issuance of a single class of
shares, designated Class A shares, for Pioneer U.S. Government Money and
Pioneer Tax-Exempt Money Fund and two classes of shares, designated Class A
and Class B, for Pioneer Cash Reserves Fund. The shares of each class
represent an interest in the same portfolio of investments of the Fund. Each
class has equal rights as to voting, redemption, dividends and liquidation,
except that each class bears different distribution and transfer agent fees
and may bear other expenses properly attributable to the particular class.
Class A and Class B shareholders have exclusive voting rights with respect to
the Rule 12b-1 distribution plans adopted by holders of those shares in
connection with the distribution of shares.
The Trust is not required, and does not intend, to hold annual shareholder
meetings although special meetings may be called for the purpose of electing
or removing Trustees, changing fundamental investment restrictions or
approving a management contract.
Generally, shares of each Fund will vote as a single series on matters
that affect all Funds in substantially the same manner. As to matters
affecting each Fund (e.g., changes in a Fund's investment restrictions),
shares of each Fund will vote as a separate series. Shares have no
preemptive, subscription, or conversion rights and are freely transferable.
Shareholders are entitled to one vote for each share held and may vote in the
election of Trustees and on other matters submitted to shareholders. Shares
are fully-paid and, except as set forth in the Statement of Additional
Information, non-assessable.
Upon liquidation of the Trust, each Fund's shareholders will receive pro
rata, subject to the rights of creditors, (a) the proceeds of the sale of the
assets held in the respective series to which the shares of the Fund relate,
less (b) the liabilities of the Trust attributable to the respective series.
Shares will remain on deposit with the Trust's transfer agent and
certificates will not be issued.
XIV. SHAREHOLDER SERVICES
PSC is the shareholder services and transfer agent for shares of the
Trust. PSC, a Massachusetts corporation, is a wholly-owned subsidiary of PGI.
PSC's offices are located at 60 State Street, Boston, Massachusetts 02109.
Inquiries to PSC should be mailed to Shareholder Services, Pioneering
Services Corporation, P.O. Box 9014, Boston, Massachusetts 02205-9014. Brown
Brothers Harriman & Co. (the "Custodian") serves as the custodian of the
Trust's portfolio securities. The principal address of the Mutual Fund
division of the Custodian is 40 Water Street, Boston, Massachusetts 02109.
Account and Confirmation Statements
PSC maintains accounts for shareholders and all transactions are recorded
in these accounts. Confirmation statements showing the details of
transactions are sent to shareholders monthly. The Pioneer Combined Account
Statement, mailed quarterly, is available to all shareholders who have more
than one Pioneer account. The bottom portion of the confirmation statement
should be used as a remittance slip to make additional investments or to
indicate a change of address on your 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. You may add to your account by sending a check
(minimum of $100 for Class A shares and $500 for Class B shares) to PSC
(account number and Class of shares should be clearly indicated). The bottom
portion of a confirmation statement may be used as a
18
<PAGE>
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 the Exchange on the day of receipt.
Automatic Investment Plans. You may arrange for regular automatic
investments of $100 or more through government/military allotments, payroll
deduction or through a Pioneer Investomatic Plan. A Pioneer Investomatic Plan
provides for a monthly or quarterly investment by means of a pre-authorized
draft drawn on a checking account. Pioneer Investomatic Plan investments are
voluntary, and you may discontinue the plan at any time 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
Shareholders will receive financial reports semi-annually. Each annual
report will be audited by the Trust's independent public accountants. In
January of each year, each Fund will mail to shareholders information about
the tax status of dividends and distributions.
Dividend Options
Regular Reinvestment. Dividends are automatically reinvested in
additional shares of the same class of each Fund in which you maintain an
investment unless you instruct otherwise.
Check. You may elect (in writing) to receive monthly dividend checks. You
may also direct that dividend checks be paid to another person or sent to
another address (other than the one on file for your account), although if
you make either designation after you have opened your account, a signature
guarantee signed by all registered account owners must accompany your
instructions.
Directed Dividends. You may elect (in writing) to have the dividends paid
by one Pioneer fund account invested in a second Pioneer fund account of the
same class. 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.,
"PGI IRA Cust for John Smith" may only go into another account registered
"PGI 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 IRS as a credit against your federal
income taxes. This option is not available for retirement plan accounts or
for accounts subject to backup withholding.
Retirement Plans
Interested persons should contact the Retirement Plans Department of PSC
at 1-800-622-0176 for information relating to Pioneer's retirement plans for
businesses, Simplified Employee Pension Plans, IRAs, Section 401(k) salary
reduction plans and Section 403(b) retirement plans for employees of
associations, public school systems and charities, all of which are available
in conjunction with investments in Pioneer Cash Reserves Fund and Pioneer
U.S. Government Money Fund. The Account Application contained in this
Prospectus should not be used to establish such plans. Separate applications
are required.
Yield Information
Yield information may be obtained by telephone 1-800-225-4321. Yield
information is updated each weekday and is based on the annualized yield over
the immediately preceding seven days, determined with a formula established
by the SEC. See "Investment Results" below. Yields are not fixed and will
vary with changes in the income and expenses of the Funds.
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.
19
<PAGE>
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.
Withdrawals from Class B share accounts are limited to 10% of the value of
the account at the time the plan is implemented. See "Waiver or Reduction of
Contingent Deferred Sales Charge" for more information. Periodic checks of
$50 or more will be sent to you monthly or quarterly. 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.
You may obtain additional information by calling PSC at 1-800-225-6292 or
by referring to the Statement of Additional Information.
Telephone Transactions and Related Liabilities
Your account is automatically authorized to have telephone transaction
privileges unless you indicate otherwise on your Account Application or by
writing to PSC. You may purchase, sell or exchange Fund shares by telephone.
For personal assistance, call 1-800-225-6292 between 8:00 a.m. and 8:00 p.m.
Eastern time on weekdays. See "Share Price," "How to Sell Fund Shares," and
"How to Exchange Fund Shares" for more information. Computer-assisted
transactions may be available to shareholders who have pre-recorded certain
bank information (see FactFone). You are strongly urged to consult with your
financial representative prior to requesting any telephone transaction. To
confirm that each transaction instruction received by telephone is genuine,
each Fund will record each telephone transaction, require the caller to
provide the personal identification number (PIN) for the account and send you
a written confirmation of each telephone transaction. Different procedures
may apply to accounts that are registered to non-U.S. citizens or that are
held in the name of an institution or in the name of an investment
broker-dealer or other third-party. If reasonable procedures, such as those
described above, are not followed, a Fund may be liable for any loss due to
unauthorized or fraudulent instructions. Each Fund may implement other
procedures from time to time. In all other cases, neither a 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 a Fund
by telephone to institute a redemption or exchange. You should communicate
with a Fund in writing if you are unable to reach the Fund by telephone.
FactFone((SM))
FactFone is an automated inquiry and telephone transaction system
available to Pioneer shareholders by dialing 1-800-225-4321. FactFone allows
you to obtain current information on your Pioneer accounts and to inquire
about the prices and yields of all publicly available Pioneer mutual funds.
In addition, you may use FactFone to make computer-assisted telephone
purchases, exchanges and redemptions from your Pioneer accounts if you have
activated your PIN. Telephone purchases and redemptions require the
establishment of a bank account of record. You are strongly urged to consult
with your financial representative prior to requesting any telephone
transaction. Shareholders whose accounts are registered in the name of a
broker-dealer or other third party may not be able to use FactFone. See "How
to Buy Fund Shares," "How to Exchange Fund Shares," "How to Sell Fund Shares"
and "Telephone Transactions and Related Liabilities." Call PSC for
assistance.
XV. INVESTMENT RESULTS
From time to time, each of the Funds may include in advertisements or
other communications to existing or proposed shareholders its respective
"yield" and "effective yield." The "yield" is computed by dividing a Fund's
net investment income per share attributable to the appropriate class during
a base period of seven days (which period will be stated in the
communication) by the net asset value per share for the appropriate class of
the Fund on the last day of such seven-day period. The Fund's net investment
income per share is determined by dividing net investment income during the
base period by the average number of shares for the appropriate class of the
Fund entitled to receive dividends during the base period. The Fund's
seven-day yield for the appropriate class is then annualized by a computation
that assumes that the Fund's net investment income is earned for a one-year
period at the same rate as during the seven-day base period. The "effective
yield" is calculated similarly, except that income is assumed to be
reinvested. The "effective yield" will be slightly higher than the "yield"
because of the compounding effect of the assumed reinvestment.
Pioneer Tax-Free Money Fund may also from time to time advertise its
taxable equivalent yield and taxable
20
<PAGE>
equivalent effective yield. The Fund's taxable equivalent yield is determined
by dividing that portion of the Fund's yield (calculated as described above)
that is tax exempt by one minus a stated marginal federal income tax rate.
The Fund's taxable equivalent effective yield is determined in a similar
manner. For further information on the computation of taxable equivalent
yield, see the Appendix to this Prospectus.
The yields of the Funds will vary from time to time depending on market
conditions, the composition of the Funds' portfolios and operating expenses
of the Funds. The temporary policy of the Funds' investment adviser to reduce
management fees and limit expenses will, so long as such policy is in effect,
have the effect of increasing yield. These factors and possible differences
in the methods used in calculating yields should be considered when comparing
performance information published for other investment companies and other
investment vehicles. Yield quotations should also be considered relative to
the risks associated with the Funds' investment objective and policies. At
any time in the future, yield quotations may be higher or lower than past
return or yield quotations, and there can be no assurance that any historical
yield quotation will continue in the future.
The Funds may also include comparative performance information in
advertising or marketing their shares. This performance information may
include data from Lipper Analytical Services, Inc., Donoghue's Money Fund
Report or other industry publications.
For more information regarding the computation of yield, see the Statement
of Additional Information.
XVI. APPENDIX
Some of the terms used in this Prospectus are described below.
"Bank Obligations" include certificates of deposit which are negotiable
certificates evidencing the indebtedness of a commercial bank to repay funds
deposited with it for a definite period of time (usually from 14 days to one
year) at a stated interest rate. Bankers' acceptances are credit instruments
evidencing the obligation of a bank to pay a draft which has been drawn on it
by a customer. These instruments reflect the obligation both of the bank and
of the drawer to pay the face amount of the instrument upon maturity. Time
deposits are non-negotiable deposits maintained in a banking institution for
a specified period of time. The Funds generally purchase time deposits with a
maturity of the following business day. Time deposits with a maturity of two
business days or more will be considered to be illiquid for purposes of the
Funds' investment restrictions.
"Commercial Paper" consists of short-term (usually from 1 to 270 days)
unsecured promissory notes issued by corporations in order to finance their
current operations. The Funds may invest only in commercial paper rated A-1
by S&P or P-1 by Moody's. The ratings A-1 and P-1 are the highest commercial
paper ratings assigned by S&P and Moody's. Commercial paper which is not
rated is not necessarily of lower quality than that which is rated, but may
be less marketable and therefore provide a higher yield.
"Money Market" refers to the marketplace composed of the financial
institutions which handle the purchase and sale of liquid, short-term,
high-grade debt instruments. The money market is not a single entity, but
consists of numerous separate markets, each of which deals in a different
type of short-term debt instrument. These include U.S. Government
obligations, commercial paper, bank obligations, municipal securities, and
other debt instruments, generally referred to as money market instruments.
"Repurchase Agreements" are transactions by which a Fund purchases a
security and simultaneously commits to resell that security to the seller at
an agreed upon price on an agreed upon date within a number of days (usually
not more than seven) from the date of purchase. The resale price reflects the
purchase price plus an agreed upon market rate of interest which is unrelated
to the coupon rate or maturity of the purchased security. A repurchase
agreement involves the obligation of the seller to pay the agreed upon price,
which obligation is in effect secured by the value (at least equal to the
amount of the agreed upon resale price and marked to market daily) of the
underlying security. Whether a repurchase agreement is the purchase and sale
of a security or a collateralized loan has not been definitely established
for purposes other than the application of the federal statutory provisions
exempting U.S. government obligations from state taxation (for which purpose
a repurchase agreement is treated as a collateralized loan). This might
become an issue in the event of the bankruptcy of the other party to the
transaction. While it is not possible to eliminate all risk from these
transactions (particularly the possibility of a decline in the market value
of the underlying securities, as well as delay and costs to a Fund in
connection with bankruptcy proceedings), it is the policy of the Trust to
enter into repurchase agreements only with banks and broker dealers approved
by the Board of Trustees of the Trust and only with respect to U.S.
Government securities which throughout the period
21
<PAGE>
have a value at least equal to the amount of the loan (including accrued
interest). It is also the policy of the Board of Trustees to evaluate on a
periodic basis the creditworthiness of the parties with which the Funds
engage in repurchase agreements.
"Tax-Exempt Securities" are debt obligations issued to obtain funds for
various public purposes, including the construction of a wide range of public
facilities such as bridges, highways, housing, mass transportation, schools,
streets and water and sewer works. Other public purposes for which tax-exempt
municipal securities may be issued include refunding outstanding obligations,
obtaining funds for general operating expenses, and obtaining funds to loan
to other public institutions. Such obligations are included within the
category of tax-exempt securities only if the interest paid thereon is both
exempt from regular federal income tax and not an item of tax preference
under the federal alternative minimum tax. There are a variety of short-term
tax-exempt securities in which Pioneer Tax-Free Money Fund may invest,
including: (i) tax anticipation notes, which finance working capital needs of
municipalities and are issued in anticipation of the receipt of tax revenue;
(ii) revenue anticipation notes, which are issued in expectation of the
receipt of other kinds of revenue, such as federal revenues available under
the federal revenue sharing program; (iii) bond anticipation notes, which are
normally issued to provide interim financing until long-term financing can be
arranged; and (iv) tax-exempt commercial paper, which includes short-term
promissory notes issued by municipalities to supplement their cash flow. The
two principal classifications of medium and long-term tax-exempt municipal
securities are "general obligation" and "revenue" bonds. General obligation
bonds are secured by the issuer's pledge of its faith, credit and taxing
power for the payment of principal and interest. The payment of such bonds
may be dependent upon an appropriation by the issuer's legislative body. The
characteristics and enforcement of general obligation bonds vary according to
the law applicable to the particular issuer. Revenue bonds are payable only
from the revenues derived from a particular facility or class of facilities
or, in some cases, from the proceeds of a special excise or other specific
revenue source. There are, of course, variations in the security of all
tax-exempt municipal securities, both within a particular classification and
between classifications, depending on numerous factors. The yields on such
securities are also dependent on a variety of factors, including general
money market conditions, supply and demand and general conditions of the
municipal securities markets, size of a particular offering, the maturity of
the obligation and rating of the issue. The ratings of Moody's and S&P
represent their opinions as to the quality of various tax-exempt municipal
securities. It should be emphasized, however, that ratings are not absolute
standards of quality. Consequently, securities with the same maturity, coupon
and rating may have different yields while securities of the same maturity
and coupon with different ratings may have the same yield.
"U.S. Government Obligations" are debt securities (including bills, notes,
and bonds) issued by the U.S. Treasury or issued by an agency or
instrumentality of the U.S. Government which is established under the
authority of an Act of Congress. Such agencies or instrumentalities include,
but are not limited to, the Federal National Mortgage Association, the Small
Business Administration, the Government National Mortgage Association, and
the Federal Home Loan Banks. Although all obligations of agencies and
instrumentalities are not direct obligations of the U.S. Treasury, payment of
the interest and principal on these obligations is generally backed directly
or indirectly by the U.S. government. This support can range from the backing
of the full faith and credit of the United States (U.S. Treasury securities
and, for example, securities issued by the Small Business Administration and
the Government National Mortgage Association) to the backing solely of the
issuing instrumentality itself (securities issued by the Federal National
Mortgage Association and the Federal Home Loan Banks). In the case of
obligations not backed by the full faith and credit of the United States, the
Trust must look principally to the agency issuing or guaranteeing the
obligation for ultimate repayment and may not be able to assert a claim
against the United States itself in the event the agency or instrumentality
does not meet its commitments.
22
<PAGE>
Taxable Equivalent Yields*
The tables below show the approximate taxable yields which are equivalent
to hypothetical tax-exempt yields from 3% to 7% under Federal income tax laws
applicable to individuals during 1994.
<TABLE>
<CAPTION>
Taxable Yield Required
Single Return Joint Return To Equal A Tax Free Yield Of:
- ---------------- ------------------ Tax -----------------------------------------------
(Taxable Income)* Rate 3% 4% 5% 6% 7%
- -------------------------------------- ------ ------ ------ ------ ------ --------
<S> <C> <C> <C> <C> <C> <C> <C>
Up to $22,750 Up to $38,000 15.0% 3.53 4.71 5.88 7.06 8.24
$22,751-$55,100 $38,001-$91,850 28.0% 4.17 5.56 6.94 8.33 9.72
$55,101-$115,000 $91,851-$140,000 31.0% 4.35 5.80 7.25 8.70 10.12
$115,001-$250,000 $140,001-$250,000 36.0% 4.69 6.25 7.81 9.38 10.94
Over $250,000 Over $250,000 39.6% 4.97 6.62 8.78 9.93 11.95
</TABLE>
*Net amount subject to Federal income tax after deductions and exemptions.
Table does not reflect the effect of Deduction Limitation and Exemption
Phaseout described below** or of the alternative minimum tax, if any. Table
assumes person filing Single Return is not a married individual filing a
separate return, a surviving spouse, or a head of household.
**Deduction Limitation: Each $100 of adjusted gross income ("AGI") in excess
of $111,800 ($55,900 for marrieds filing separately) causes the loss of $3
of itemized deductions. This limitation affects all itemized deductions
other than medical expenses, investment interest, and casualty, theft and
wagering losses. However, not more than 80% of a taxpayer's itemized
deductions can be eliminated. The threshold amounts will be adjusted for
inflation from year to year.
Exemption Phaseout: Each $2,500 or fraction thereof of AGI in excess of
$167,700 for joint filers ($111,800 for single taxpayers) causes taxpayers
to lose 2% of their personal exemptions. The threshold amounts will be
adjusted for inflation from year to year.
Some tax brackets and the threshold amounts will be adjusted for inflation
in 1994.
The following formula can be used to calculate a taxable yield
which is equivalent to the corresponding tax-free yield:
Tax Free Yield
-------------------- = Taxable Equivalent Yield
1 - Your Tax Bracket
For example, if you are in the 28% tax bracket and earn a tax-free
yield of 5%, the taxable equivalent yield would be 6.94%.
5% .05
------- = --- = 6.94%
1 - 28% .72
There can be no assurance that the Pioneer Tax-Free Money Fund will
achieve any specific tax-exempt yield. While it is expected that a
substantial portion of the interest income distributed to investors in the
Tax-Free Fund will be exempt from regular federal income taxes, portions of
such distributions may be subject to regular federal income tax or federal
alternative minimum tax. In addition, all or a substantial portion of such
distributions may be subject to state and local taxes. Subsequent tax law
changes could result in prospective or retroactive changes in the tax
brackets, tax rates and tax equivalent yields set forth above.
23
<PAGE>
Pioneer Cash Reserves Fund
Pioneer U.S. Government Money Fund
Pioneer Tax-Free Money Fund
60 State Street
Boston, Massachusetts 02109
OFFICERS
JOHN F. COGAN, JR., Chairman and President
DAVID D. TRIPPLE, Executive Vice President
SHERMAN B. RUSS, 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, Massachusetts 02109
Telephone: 1-800-225-6292
SERVICE INFORMATION
If you would like information on the following, please call . . .
Existing and new accounts, prospectuses,
applications, service forms and
FactFone((S)M) telephone transactions 1-800-225-6292
Automated fund yields, automated 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
0995-2771
((C))Pioneer Funds Distributor, Inc.
[Pioneer logo]
Pioneer
Cash Reserves
Fund
Pioneer
U.S. Government
Money Fund
Pioneer
Tax-Free
Money Fund
Class A and Class B Shares
Prospectus
March 31, 1995
(revised September 8, 1995)
