Pioneer Cash Reserves Fund
Pioneer U.S. Government Money Fund
(Graphic - Pioneer Logo)
Class A and Class B Shares
Prospectus March 31, 1995
(revised January 5, 1996)
Pioneer Cash Reserves Fund and Pioneer U.S. Government Money Fund (the
"Funds" or, individually, the "Fund") 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 ("U.S.")
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.
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
(revised January 5, 1996), 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 3
III. THE TRUST 4
IV. TWO INVESTMENT PROGRAMS 4
Suitability 4
Investment Policies 5
Additional Information 5
V. FUND SHARE ALTERNATIVES 6
Class A Shares 6
Class B Shares 6
VI. SHARE PRICE 7
VII. HOW TO BUY FUND SHARES 7
VIII. HOW TO SELL FUND SHARES 10
IX. HOW TO EXCHANGE FUND SHARES 12
X. DISTRIBUTION PLANS 13
XI. DIVIDENDS, DISTRIBUTIONS AND TAXATION 13
XII. MANAGEMENT OF THE TRUST 14
XIII. DESCRIPTION OF SHARES AND VOTING RIGHTS 15
XIV. SHAREHOLDER SERVICES 16
Account and Confirmation Statements 16
Additional Investments 16
Automatic Investment Plans 16
Financial Reports and Tax Information 16
Dividend Options 16
Voluntary Tax Withholding 17
Retirement Plans 17
Yield Information 17
Telecommunications Device for the Deaf (TDD) 17
Systematic Withdrawal Plans 17
Telephone Transactions and Related Liabilities 17
FactFone(SM) 17
XV. INVESTMENT RESULTS 18
XVI. APPENDIX 18
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 and, for
Class B shares, percentages are based on estimated expenses that would have
been incurred during the fiscal year had Class B shares been outstanding.
Pioneer Cash
Reserves Fund
-----------------------
Shareholder Transaction Expenses: Class A Class B
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
proceeds, as applicable) None 4.00%
Redemption Fee(1) None None
Exchange Fee None None
Annual Operating Expenses (as a percentage of
net assets):
Management Fee (after Expense Limitation)(2) 0.25% 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
U.S. Government
Money Fund
------------------
Shareholder Transaction Expenses:
Maximum Initial Sales Charge on Purchases (as
a percentage of offering price) None
Maximum Sales Charge on Reinvestment of
Dividends None
Redemption Fee(1) None
Exchange Fee None
Annual Operating Expenses
(as a percentage of net assets):
Management Fee (after Expense Limitation)(2) 0.00%
12b-1 Fees 0.12%
Other Expenses (including transfer agent fee,
custodian fees and accounting and printing
expenses)
(after Expense Limitation)(2) 0.73%
Total Operating Expenses
(after Expense Limitation)(2) 0.85%
================
(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.
Cash Government
Reserves Money
Fund Fund Fund
- ------------------------------ ---------- -------------
Management Fee 0.40% 0.40%
Expense Limitation 0.85%* 0.85%
Expenses Absent Limitation
Other Expenses
Class A n/a 0.78%
Class B n/a n/a
Total Operating Expenses
Class A 1.00% 1.30%
Class B 1.90% 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.
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
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.
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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 (as defined in "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.
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>
* 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.
3
<PAGE>
Pioneer U.S. Government Money Fund
Selected Data for each Class A Share Outstanding For the Periods Presented
<TABLE>
<CAPTION>
For the Year Ended December 31,
----------------------------------------------------------
April 11,
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.
III. THE TRUST
Pioneer Cash Reserves Fund and Pioneer U.S. Government 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 two series, and
continuously offers its shares to the public. In addition to the Funds, the
Trust previously offered a third series, Pioneer Tax-Free Money Fund, which
is expected to cease operations on or about January 8, 1996 pursuant to a
Plan of Liquidation approved by the Trustees. 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, designated Class A, and,
for Pioneer Cash Reserves Fund only, two classes of shares, designated Class
A and Class B.
IV. TWO INVESTMENT PROGRAMS
The investment objective of Pioneer Cash Reserves Fund and Pioneer U.S.
Government Money Fund is to provide high current income, preservation of
capital and liquidity through investments in high-quality short-term
securities.
Both of the Funds seek 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.
4
<PAGE>
Investment Policies
Pioneer Cash Reserves Fund invests in the following types of high-quality,
money market instruments:
(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.
The Fund may purchase 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.
(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.
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, 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). 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
5
<PAGE>
$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 Funds' 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 and repurchase agreements 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 Fund offers 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 contingent deferred sales charges ("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 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 mutual 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,
6
<PAGE>
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
Corporation ("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 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 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
7
<PAGE>
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 Individual Retirement Accounts ("IRAs") 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 1-800-225-6292 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 1-800-225-6292. 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 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
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shares acquired by exchange from Class B shares of another Pioneer mutual
fund will convert into Class A shares based on the date of the initial
purchase and 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 ("IRS"), 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 Internal Revenue
Code of 1986, as amended (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 Code, occurring after the purchase of the shares being
redeemed of a shareholder or participant in an employer-sponsored retirement
plan; (b) the distribution is to a participant in an IRA, 403(b) or
employer-sponsored retirement plan, is part of a series of substantially
equal payments made over the life expectancy of the participant or the joint
life expectancy of the participant and his or her beneficiary or as scheduled
periodic payments to a participant (limited in any year to 10% of the value
of the participant's account at the time the distribution amount is
established; a required minimum distribution due to the participant's
attainment of age 70-1/2 may exceed the 10% limit only if the distribution
amount is based on plan assets held by Pioneer); (c) the distribution is from
a 401(a) or 401(k) retirement plan and is a return of excess employee
deferrals or employee contributions or a qualifying hardship distribution as
defined by the Code or results from a termination of employment (limited with
respect to a termination to 10% per year of the value of the plan's assets in
the Fund as of the later of the prior December 31 or the date the account was
established unless the plan's assets are being rolled over to or reinvested
in the same class of shares of a Pioneer mutual fund subject to the CDSC of
the shares originally held); (d) the distribution is from an IRA, 403(b) or
employer-sponsored retirement plan and is to be rolled over to or reinvested
in the same class of shares in a Pioneer mutual fund and which will be
subject to the applicable CDSC upon redemption; (e) the distribution is in
the form of a loan to a participant in a plan which permits loans (each
repayment of the loan will constitute a new sale which will be subject to the
applicable CDSC upon redemption); or (f) the distribution is from a qualified
defined contribution plan and represents a participant's directed transfer
(provided that this privilege has been 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 either Fund 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
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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. Each 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 or 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. Each 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 available 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
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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, if any, 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 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 PSC. 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 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
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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 telephone exchange request, whether by
voice or by FactFone, 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 mutual fund account for shares of the same Class in another Pioneer
mutual fund 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 either Fund 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 either Fund 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 mutual funds offer more than one Class of
shares. A new Pioneer mutual fund 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, 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.
You should consider the differences in objectives and policies of the
Pioneer mutual funds, as described in each fund's current prospectus, before
making any exchange. For the protection of each Fund's performance and
shareholders, the Funds and PFD reserve the right to refuse any exchange
request or restrict, at any time without notice, the number and/or frequency
of exchanges to prevent abuses of the exchange privilege. Such abuses may
arise from frequent trading in response to short-term market fluctuations, a
pattern of trading by an individual or group that appears to be an attempt to
"time the market," or any other exchange request which, in the view of
management, will have a detrimental effect on a Fund's portfolio management
strategy or its operations. In addition, the Fund and PFD reserve the right
to charge a fee for exchanges or to modify, limit, sus-
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pend or discontinue the exchange privilege with notice to shareholders as
required by law.
X. DISTRIBUTION PLANS
The Trust, on behalf of each 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 each Fund's 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 Trust'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 each of the Funds 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 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% federal excise tax on a portion of its
undistributed ordinary income and capital gains if it fails to meet certain
distribution requirements with respect to each calendar year. 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
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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 each of the Fund's shareholders
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.
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
a Fund that is attributable to the interest received from certain U.S.
government obligations will be exempt from state income taxation. A state
and/or local intangible property tax exemption may also be available to the
extent the value of a Fund's assets is attributable to such U.S. government
obligations. In some cases, state tax rules may condition these exemptions on
certain concentration, designation, reporting or other requirements, and the
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 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 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
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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 Trust and the
Trustees; (i) distribution fees paid by each 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 mutual 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
and Pioneer U.S. Government Money Fund incurred actual expenses of $1,117,021
and $324,626, 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 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 the date of this Prospectus. PMC is a
wholly-owned subsidiary of PGI. PFD is an indirect wholly-owned subsidiary
of PGI.
XIII. DESCRIPTION OF SHARES AND VOTING RIGHTS
The shares of the Trust are divided into three series. One of the three
series, Pioneer Tax-Free Money Fund, is expected to cease operations on or
about January 8, 1996 in accordance with a Plan of Liquidation approved by
the Trustees. 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 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 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)
15
<PAGE>
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 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 mutual fund account invested in a second Pioneer mutual 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
16
<PAGE>
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. The Account Application
accompanying 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.
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 9:00 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(SM)"). 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
17
<PAGE>
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.
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
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
18
<PAGE>
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 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.
"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.
19
<PAGE>
Pioneer Cash Reserves Fund
Pioneer U.S. Government 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(SM) 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
1295-2961
(C)Pioneer Funds Distributor, Inc.
[pioneer logo]
Pioneer
Cash Reserves
Fund
Pioneer
U.S. Government
Money Fund
Class A and Class B Shares
Prospectus
March 31, 1995
(revised January 5, 1996)
<PAGE>
PIONEER MONEY MARKET TRUST
Pioneer Cash Reserves Fund
Class A and Class B Shares
Pioneer U.S. Government Money Fund
Class A Shares
60 State Street
Boston, Massachusetts 02109
STATEMENT OF ADDITIONAL INFORMATION
March 31, 1995
(revised January 5, 1996)
This Statement of Additional Information (Part B of the Registration
Statement) is not a Prospectus, but should be read in conjunction with the
Prospectus (the "Prospectus") dated March 31, 1995 (revised January 5, 1996) of
Pioneer Money Market Trust (the "Trust"). A copy of the Prospectus can be
obtained free of charge by calling Shareholder Services at 1-800-225-6292 or by
written request to the Trust at 60 State Street, Boston, Massachusetts 02109.
The Trust's financial statements for the fiscal year ended December 31, 1994 are
attached to this Statement of Additional Information.
TABLE OF CONTENTS
Page
1. Investment Policies and Restrictions..................................2
2. Management of the Trust...............................................4
3. Investment Adviser....................................................7
4. Principal Underwriter.................................................8
5. Distribution Plans....................................................9
6. Shareholder Servicing/Transfer Agent..................................11
7. Custodian.............................................................11
8. Independent Public Accountants........................................12
9. Portfolio Transactions................................................12
10. Tax Status............................................................13
11. Description of Shares.................................................14
12. Certain Liabilities...................................................14
13. Determination of Net Asset Value......................................15
14. Systematic Withdrawal Plan............................................16
15. Investment Results....................................................17
16. Financial Statements..................................................18
Appendix A.................................................................A-1
Appendix B.................................................................B-1
-------------------------
THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS AND IS AUTHORIZED
FOR DISTRIBUTION TO PROSPECTIVE INVESTORS ONLY IF PRECEDED OR ACCOMPANIED BY AN
EFFECTIVE PROSPECTUS.
<PAGE>
1. INVESTMENT POLICIES AND RESTRICTIONS
The Prospectus of the Trust identifies the investment objective of each
series of the Trust: Pioneer Cash Reserves Fund and Pioneer U.S. Government
Money Fund (collectively, the "Funds"), and the principal investment policies of
the Funds. Other investment policies and a further description of some of the
policies described in the Prospectus are set forth below. In addition to the
Funds, the Trust previously offered a third fund, Pioneer Tax-Free Money Fund,
which is expected to cease operations on or about January 8, 1996 pursuant to a
Plan of Liquidation approved by the Trustees.
The following policies and limitations supplement those discussed in
the Prospectus. Whenever an investment policy or limitation states a maximum
percentage of a Fund's assets that may be invested in any security or sets forth
a policy regarding quality standards, such standard or other limitation shall be
determined immediately after and as a result of the Fund's investment.
Accordingly, any later increase or decrease resulting from a change in values,
net assets or other circumstances will not be considered in determining whether
the investment complies with such Fund's investment objectives and policies.
Certificates of Deposit. Pioneer Cash Reserves Fund may invest in
certificates of deposit of large domestic banks and savings and loan
associations (i.e., banks which at the time of their most recent annual
financial statements show total assets in excess of $1 billion), including
foreign branches of such domestic banks, and of smaller banks as described
below. The Fund will not invest in certificates of deposit of foreign banks.
Investment in certificates of deposit issued by foreign branches of
domestic banks involves investment risks that are different in some respects
from those associated with investment in certificates of deposit issued by
domestic banks, including the possible imposition of withholding taxes on
interest income, the possible adoption of foreign governmental restrictions
which might adversely affect the payment of principal and interest on such
certificates of deposit, or other adverse political or economic developments. In
addition, it might be more difficult to obtain and enforce a judgment against a
foreign branch of a domestic bank.
Although the Fund's investment adviser recognizes that the size of a
bank is important, this fact alone is not necessarily indicative of its
creditworthiness. The Fund may invest in certificates of deposit issued by banks
and savings and loan institutions which had at the time of their most recent
annual financial statements total assets not in excess of $1 billion, provided
that (i) the principal amounts of such certificates of deposit are insured by an
agency of the U.S. government, (ii) at no time will the Fund hold more than
$100,000 principal amount of certificates of deposit of any one such bank and
(iii) at the time of acquisition, no more than 10% of the Fund's assets (taken
at current value) are invested in certificates of deposit of such banks having
total assets not in excess of $1 billion.
Investment Restrictions. The following numerical list sets forth all of
the fundamental investment restrictions applicable to the Funds. These
restrictions cannot be changed for a Fund unless a majority of the outstanding
securities of such Fund approves the change. As used in the Prospectus and this
Statement of Additional Information, such approval means the approval of the
lesser of (i) the holders of 67% or more of the shares represented at a meeting
if the holders of more than 50% of the outstanding shares are present in person
or by proxy, or (ii) the holders of more than 50% of the outstanding shares.
-2-
<PAGE>
A Fund may not:
(1) except with respect to investments in obligations of (a) the U.S.
government, its agencies, authorities or instrumentalities and (b) domestic
banks, purchase any security if, as a result (i) more than 5% of the assets of
the Fund would be in the securities of any one issuer, or (ii) more than 25% of
its assets would be in a particular industry;
(2) borrow money, except from banks for extraordinary purposes or to
meet redemptions in amounts not exceeding 33 1/3% of its total assets (including
the amount borrowed). Neither of the Funds intends to borrow money during the
coming year;
(3) make short sales of securities;
(4) purchase securities on margin;
(5) write, purchase or otherwise invest in any put, call, straddle or
spread option or buy or sell real estate, commodities or commodity futures
contracts or invest in oil, gas or mineral exploration or development programs;
(6) make loans to any person, except by (a) the purchase of a debt
obligation in which the Fund is permitted to invest and (b) engaging in
repurchase agreements;
(7) purchase the securities of other investment companies or investment
trusts, unless they are acquired as part of a merger, consolidation or
acquisition of assets;
(8) act as an underwriter, except as it may be deemed to be an
underwriter in a sale of restricted securities;
(9) invest in companies for the purpose of exercising control or
management; or
(10) issue senior securities, except that the issuance of multiple
classes of shares, in accordance with a statute, regulation or order of the
Securities and Exchange Commission, shall not constitute the issuance of a
senior security.
In addition, in order to comply with certain state statutes and
non-fundamental policies of the Funds, the Funds will not (i) pledge, mortgage
or hypothecate their portfolio securities if at the time of such action the
value of the securities so pledged, mortgaged or hypothecated would exceed 10%
of the value of a Fund, (ii) commit more than 10% of their assets to illiquid
investments, such as repurchase agreements that mature in more than seven days,
(iii) invest more than 5% of their assets in companies which, including
predecessors, have a record of less than three years continuous operation, (iv)
invest in warrants, (v) purchase or retain the securities of any issuer if any
officer or Trustee of the Fund or its investment adviser is an officer or
director of such issuer and beneficially owns more than 1/2 of 1% of the
securities of such issuer and all of the officers and the Trustees of the Fund
and the Fund's investment adviser together own more than 5% of the securities of
such issuer, (vi) buy or sell real estate, including real estate limited
partnerships, except that each Fund may acquire or lease office space for its
own use, invest in securities of issuers that invest in real estate or interests
therein, invest in securities that are secured by real estate or interests
therein, purchase and sell mortgage-related securities and hold
-3-
<PAGE>
and sell real estate acquired by the Fund as a result of the ownership of
securities or (vii) invest in oil, gas or mineral exploration or development
programs or leases. The term "person" as used in fundamental investment
restriction no. 6 includes institutions as well as individuals. Policies in this
paragraph may be changed by the Trustees without shareholder approval or
notification.
See the Prospectus for a discussion of certain additional regulatory
requirements applicable to the Funds.
2. MANAGEMENT OF THE TRUST
The Trust's Board of Trustees provides broad supervision over the
affairs of the Trust. The officers of the Trust are responsible for the Trust's
operations. The Trustees and executive officers of the Trust are listed below,
together with their principal occupations during the past five years. An
asterisk indicates those Trustees who are interested persons of the Trust within
the meaning of the Investment Company Act of 1940, as amended (the "1940 Act").
JOHN F. COGAN, JR.*, Chairman of the Board, President and Trustee, DOB: 6/13/26
President, Chief Executive Officer and a Director of The Pioneer Group,
Inc. ("PGI"); Chairman and a Director of Pioneering Management Corporation
("PMC") and Pioneer Funds Distributor, Inc. ("PFD"); Director of Pioneering
Services Corporation ("PSC"), Pioneer Capital Corporation ("PCC") and
Forest-Starma (a Russian corporation); President and Director of Pioneer Plans
Corporation ("PPC"), Pioneer Investment Corp. ("PIC"), Pioneer Metals and
Technology, Inc. ("PMT"), Pioneer International Corp. ("PIntl"), Luscina, Inc.,
Pioneer First Russia, Inc. ("First Russia"), Pioneer Omega, Inc. ("Omega") and
Theta Enterprises, Inc.; Chairman of the Board and Director of Pioneer
Goldfields Limited ("PGL") and Teberebie Goldfields Limited; Chairman of the
Supervisory Board of Pioneer Fonds Marketing, GmbH ("Pioneer GmbH"); Member of
the Supervisory Board of Pioneer First Polish Trust Fund Joint Stock Company
("PFPT"); Chairman, President and Trustee of all of the Pioneer mutual funds and
Partner, Hale and Dorr (counsel to the Fund).
RICHARD H. EGDAHL, M.D., Trustee, DOB: 12/13/26
Boston University Health Policy Institute, 53 Bay State Rd., Boston, MA 02115
Professor of Management, Boston University School of Management, since
1988; Professor of Public Health, Boston University School of Public Health;
Professor of Surgery, Boston University School of Medicine; Director, Boston
University Health Policy Institute and Boston University Medical Center;
Executive Vice President and Vice Chairman of the Board, University Hospital;
Academic Vice President for Health Affairs, Boston University; Director, Essex
Investment Management Company, Inc. (investment adviser), Health Payment Review,
Inc. (health care containment software firm), Mediplex Group, Inc. (nursing care
facilities firm), Peer Review Analysis, Inc. (health care facilities firm) and
Springer-Verlag New York, Inc. (publisher); Honorary Trustee, Franciscan
Children's Hospital and Trustee of all of the Pioneer mutual funds.
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MARGARET B.W. GRAHAM, Trustee, DOB: 5/12/47
The Keep, P.O. Box 110, Little Deer Isle, ME 04650
Founding Director, Winthrop Group, Inc. (consulting firm) since 1982;
Manager of Research Operations, Xerox Palo Alto Research Center, between 1991
and 1994; Professor of Operations Management and Management of Technology,
Boston University School of Management ("BUSM"), between 1989 and 1993 and
Trustee of all of the Pioneer mutual funds except Pioneer Variable Contracts
Trust.
JOHN W. KENDRICK, Trustee, DOB: 7/27/17
6363 Waterway Drive, Falls Church, VA
Professor Emeritus and Adjunct Scholar, George Washington University;
Economic Consultant and Director, American Productivity and Quality Center;
American Enterprise Institute and Trustee of all of the Pioneer mutual funds,
except Pioneer Variable Contracts Trust.
MARGUERITE A. PIRET, Trustee, DOB: 5/10/48
One Boston Place, Suite 2363, Boston, MA 02108
President, Newbury, Piret & Company, Inc. (merchant banking firm) and
Trustee of all of the Pioneer mutual funds.
DAVID D. TRIPPLE*, Trustee and Executive Vice President, DOB: 2/13/44
Executive Vice President and a Director of PGI; Director of PFD, PCC,
PIC, PIntl and Pioneer SBIC Corporation; President, Chief Investment Officer and
a Director of PMC, Executive Vice President and Trustee of all of the Pioneer
mutual funds.
STEPHEN K. WEST, Trustee, DOB: 5/18/45
125 Broad Street, New York, New York 10004
Partner, Sullivan & Cromwell (law firm); Trustee, The Winthrop Focus
Funds (mutual funds) and Trustee of all of the Pioneer mutual funds except
Pioneer Variable Contracts Trust.
JOHN WINTHROP, Trustee, DOB: 6/22/36
One North Adgers Wharf, Charleston, South Carolina 29401
President, John Winthrop & Co., Inc. (a private investment firm);
Director of NUI Corp.; Trustee of Alliance Capital Reserves, Alliance Government
Reserves and Alliance Tax Exempt Reserves and Trustee of all of the Pioneer
mutual funds.
WILLIAM H. KEOUGH, Treasurer, DOB: 4/12/37
Senior Vice President, Chief Financial Officer and Treasurer of PGI and
Treasurer of PFD, PMC, PSC, PCC, PIC, PIntl, PMT, PGL and Pioneer SBIC
Corporation and Treasurer and Director of PPC and Treasurer of all of the
Pioneer mutual funds.
JOSEPH P. BARRI, Secretary, DOB: 8/11/46
Secretary of PGI, PMC, PPC, PIC, PIntl, PMT and PCC; Clerk of PFD and
PSC; Partner, Hale and Dorr (counsel to the Fund) and Secretary of all of the
Pioneer mutual funds.
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ERIC W. RECKARD, Assistant Treasurer, DOB: 6/19/56
Manager of Fund Accounting and Compliance of PMC since May 1994,
Manager of Auditing and Business Analysis for PGI prior to May 1994 and
Assistant Treasurer of all of the Pioneer mutual funds.
ROBERT P. NAULT, Assistant Secretary, DOB: 3/7/64
General Counsel of PGI since 1995; formerly of Hale and Dorr (counsel
to the Fund) where he most recently served as junior partner and Assistant
Secretary of all of the Pioneer mutual funds except Pioneer Variable Contracts
Trust.
SHERMAN B. RUSS, Vice President, DOB: 7/26/37
Senior Vice President of PMC; Vice President of Pioneer Bond Fund,
Pioneer America Income Trust and Pioneer Interest Shares, Inc.
The Trust's Agreement and Declaration of Trust (the "Declaration of
Trust") provides that the holders of two-thirds of its outstanding shares may
vote to remove a Trustee of the Trust at any meeting of shareholders. See
"Description of Shares" below. The business address of all officers is 60 State
Street, Boston, Massachusetts 02109.
To the knowledge of the Trust, no officer or Trustee of the Trust owned 5%
or more of the issued and outstanding shares of PGI on February 28, 1995, except
Mr. Cogan who then owned approximately 15% of such shares.
At February 28, 1995, the Trustees and officers of the Trust owned in the
aggregate less than 1% of the outstanding securities of the Trust. As of
February 28, 1995, PGI-Rollover IRA Custodian for George E. Siek, Sr. owned
approximately 6.95% of Pioneer U.S. Government Money Fund's total assets and
Kirpet Co. owned approximately 9.95% of Pioneer Cash Reserves Fund's total
assets. To the knowledge of the Trust, as of February 28, 1995, no person other
than mentioned above owned of record or beneficially more than 5% of the
outstanding shares of any series of the Trust.
All of the outstanding capital stock of PFD, PMC and PSC is owned,
directly or indirectly, by PGI, a publicly-owned Delaware corporation. PMC, the
Trust's investment adviser, owns all of the outstanding capital stock of PFD and
serves as the investment adviser for the Pioneer mutual funds listed below and
manages the investments of certain institutional private accounts.
The table below lists all the Pioneer mutual funds currently offered to
the public and the investment adviser and principal underwriter for each fund.
Investment Principal
Fund Name Adviser Underwriter
Pioneer International Growth Fund PMC PFD
Pioneer Europe Fund PMC PFD
Pioneer Emerging Markets Fund PMC PFD
Pioneer India Fund PMC PFD
Pioneer Capital Growth Fund PMC PFD
Pioneer Mid-Cap Fund PMC PFD
Pioneer Growth Shares PMC PFD
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Pioneer Small Company Fund PMC PFD
Pioneer Gold Shares PMC PFD
Pioneer Equity-Income Fund PMC PFD
Pioneer Fund PMC PFD
Pioneer II PMC PFD
Pioneer Real Estate Shares PMC PFD
Pioneer Short-Term Income Trust PMC PFD
Pioneer America Income Trust PMC PFD
Pioneer Bond Fund PMC PFD
Pioneer Income Fund PMC PFD
Pioneer Intermediate Tax-Free Fund PMC PFD
Pioneer Tax-Free Income Fund PMC PFD
Pioneer New York Triple Tax-Free Fund PMC PFD
Pioneer Massachusetts Double Tax-Free Fund PMC PFD
Pioneer California Double Tax-Free Fund PMC PFD
Pioneer U.S. Government Money Fund PMC PFD
Pioneer Cash Reserves Fund PMC PFD
Pioneer Interest Shares, Inc. PMC Note 1
Pioneer Variable Contracts Trust PMC Note 2
Note 1 This fund is a closed-end fund.
Note 2 This is a series of eight separate portfolios designed to provide
investment vehicles for the variable annuity and variable life
insurance contracts of various insurance companies or for certain
qualified pension plans.
Compensation of Officers and Trustees. The Trust pays no salaries or
compensation to any of its officers. The Trust pays an annual trustees' fee of
$100, and a payment of $1,000 plus expenses per meeting attended, to each
Trustee who is not affiliated with PMC, PFD or PSC and pays an annual trustees'
fee of $500 plus expenses to each Trustee affiliated with PMC, PFD or PSC. Any
such fees and expenses paid to affiliates or interested persons of PMC, PFD or
PSC are reimbursed to the Trust under its Management Contract. The following
table sets forth certain information with respect to the compensation of each
Trustee of the Trust:
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Pension or
Retirement Total
Benefits Compensation
Aggregate Accrued as from Trust and
Compensation Part of Pioneer Family
Name of Trustee from the Trust* Trust's Expenses of Funds**
John F. Cogan, Jr.*** $ 500 $0 $ 9,000
Richard H. Egdahl, M.D. 3,400 0 $55,650
Margaret B.W. Graham 3,400 0 $55,650
John W. Kendrick 3,400 0 $55,650
Marguerite A. Piret 4,300 0 $66,650
David D. Tripple*** 500 0 $ 9,000
Stephen K. West 4,000 0 $63,650
John Winthrop 4,000 0 $63,650
* As of Trust's fiscal year end.
** As of December 31, 1994 (calendar year end for all Pioneer Funds listed
above).
*** All fees paid by the Trust to "interested" Trustees are reimbursed to
the Trust by PMC.
3. INVESTMENT ADVISER
The Trust has contracted with PMC, 60 State Street, Boston,
Massachusetts, to act as its investment adviser. The term of the contract is one
year and it is renewable annually by the vote of a majority of the Board of
Trustees of the Trust (including a majority of the Board of Trustees who are not
parties to the contract or interested persons of any such parties). The vote
must be cast in person at a meeting called for the purpose of voting on such
renewal. This contract terminates if assigned and may be terminated without
penalty by either party by vote of its Board of Directors or Trustees or a
majority of its outstanding voting securities and the giving of sixty days'
written notice. As compensation for its management services and expenses
incurred, PMC is entitled to a management fee at the rate of 0.40% per annum of
each Fund's average daily net assets. The fee is normally computed daily and
paid monthly. PMC has agreed not to impose management fees for the Funds and if
necessary to limit or otherwise reduce other operating expenses to the extent
needed to limit the expenses of each Fund in accordance with the schedule set
forth in the Prospectus under Note 2 to "Expense Information." The management
fee attributable to Class B Shares will only be imposed to the extent it is
imposed for Class A Shares. PMC's agreement is voluntary and temporary and may
be revised or terminated at any time. The purpose of this policy is to enhance a
Fund's dividend yield during the period when, because of its smaller size, fixed
expenses have a more significant impact on yield.
During the fiscal year ended December 31, 1994, pursuant to the expense
limitation discussed above, the management fees of Pioneer Cash Reserves Fund,
Pioneer U.S. Government Money Fund and Pioneer Tax Free Money Fund were reduced
by $250,479, $117,274 and $36,209, respectively, resulting in actual management
fees paid during such period of $214,043, $0 and $0, respectively. During the
fiscal year ended December 31, 1993, the management fees of Pioneer Cash
Reserves Fund, Pioneer U.S. Government Money Fund and Pioneer Tax-Free Money
Fund were reduced by $201,232, $92,361 and $29,957, respectively, resulting in
actual management fees paid during such period of $28,991, $0 and $0,
respectively. During the fiscal
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year ended December 31, 1992, the management fees of Pioneer Cash Reserves Fund,
Pioneer U.S. Government Money Fund and Pioneer Tax-Free Money Fund were reduced
by $136,097, $104,034 and $30,942, respectively, resulting in actual management
fees paid during such period to PMC of $125,487, $0 and $0, respectively.
4. PRINCIPAL UNDERWRITER
PFD serves as the principal underwriter for the Trust in connection
with the continuous offering of the Trust's Class A shares and Pioneer Cash
Reserves Fund Class B shares. During the Trust's two most recently completed
fiscal years, no underwriting commissions were paid to PFD. PFD commenced
service as the Trust's principal underwriter as of March 31, 1995.
The Trust, on behalf of each Fund, entered into an Underwriting
Agreement with PFD. The Underwriting Agreement will continue from year to year
if annually approved by the Trustees. The Underwriting Agreement provides that
PFD will bear expenses for the distribution of the Trust's shares, except for
expenses incurred by PFD for which it is reimbursed by the Trust under the Rule
12b-1 distribution plans applicable to the Class A and Class B shares.
PFD bears all expenses it incurs in providing services under the
Underwriting Agreement. Such expenses include compensation to its employees and
representatives and to securities dealers for distribution related services
performed for the Trust. PFD also pays certain expenses in connection with the
distribution of the Trust's shares, including the cost of preparing, printing
and distributing advertising or promotional materials, and the cost of printing
and distributing prospectuses and supplements to prospective shareholders. The
Trust bears the cost of registering its shares under federal and state
securities law and the laws of certain foreign countries.
The Trust and PFD have agreed to indemnify each other against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.
Under the Underwriting Agreement, PFD will use its best efforts in rendering
services to the Trust.
The Trust will not generally issue shares for consideration other than
cash. At the Trust's sole discretion, however, it may issue shares for
consideration other than cash in connection with a bona fide reorganization,
statutory merger, or other acquisition of portfolio securities (other than
municipal debt securities issued by state political subdivisions or their
agencies or instrumentalities) provided (i) the securities meet the investment
objectives and policies of the Trust; (ii) the securities are acquired by the
Trust for investment and not for resale; (iii) the securities are not restricted
as to transfer either by law or liquidity of market; and (iv) the securities
have a value which is readily ascertainable. An exchange of securities for Trust
shares may be a taxable transaction to the shareholder.
The redemption price of shares of beneficial interest of the Trust may,
at the Manager's discretion, be paid in cash or portfolio securities. The Trust
has, however, elected to be governed by Rule 18f-1 under the 1940 Act pursuant
to which the Trust is obligated to redeem shares solely in cash up to the lesser
of $250,000 or 1% of the Trust's net asset value during any 90-day period for
any one shareholder. Should the amount of redemptions by any shareholder exceed
such limitation, the Trust will have the option of redeeming the excess in cash
or portfolio securities. In the latter case, the securities are taken at the
value employed in determining the Trust's net asset value. A shareholder whose
shares are redeemed in-kind may incur brokerage charges in selling the
securities received in-kind. The selection of such securities will be made in
such manner as the Board deems fair and reasonable.
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5. DISTRIBUTION PLANS
The Trust, on behalf of each Fund, has adopted a plan of distribution
pursuant to Rule 12b-1 promulgated by the Commission under the 1940 Act with
respect to Class A shares (the "Class A Plan") and a plan of distribution with
respect to Class B shares of Pioneer Cash Reserves Fund only (the "Class B
Plan") (together, the "Plans").
Class A Plan. Pursuant to the Class A Plan a Fund may reimburse PFD for
its expenditures in financing any activity primarily intended to result in the
sale of the Class A Plan shares. Certain categories of such expenditures have
been approved by the Board of Trustees and are set forth in the Prospectus. See
"Distribution Plans" in the Prospectus. The expenses of each Fund pursuant to
the Class A Plan are accrued daily at a rate which may not exceed the annual
rate of 0.15% of a Fund's average daily net assets attributable to Class A
shares.
Class B Plan. The Class B Plan provides that Pioneer Cash Reserves Fund
shall pay PFD, as the Fund's distributor for its Class B shares, a daily
distribution fee equal on an annual basis to 0.75% of the Fund's average daily
net assets attributable to Class B shares and will pay PFD a service fee equal
to 0.25% of the Fund's average daily net assets attributable to Class B shares
(which PFD will in turn pay to securities dealers which enter into a sales
agreement with PFD at a rate of up to 0.25% of the Fund's average daily net
assets attributable to Class B shares owned by investors for whom that
securities dealer is the holder or dealer of record). This service fee is
intended to be consideration for personal services and/or account maintenance
services rendered by the dealer with respect to Class B shares. PFD will advance
to dealers the first-year service fee at a rate equal to 0.25% of the amount
invested. As compensation therefor, 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 thirteenth month following purchase. Dealers may from time to
time be required to meet certain other criteria in order to receive service
fees. PFD or its affiliates are entitled to retain all service fees payable
under the Class B Plan for which there is no dealer of record or for which
qualification standards have not been met as partial consideration for personal
services and/or account maintenance services performed by PFD or its affiliates
for shareholder accounts.
The purpose of distribution payments to PFD under the Class B Plan is
to compensate PFD for its distribution services to Pioneer Cash Reserves Fund.
PFD pays commissions to dealers as well as expenses of printing prospectuses and
reports used for sales purposes, expenses with respect to the preparation and
printing of sales literature and other distribution related expenses, including,
without limitation, the cost necessary to provide distribution-related services
or personnel, travel, office expenses and equipment. The Class B Plan also
provides that PFD will receive all CDSCs attributable to Class B shares. (See
"Distribution Plans" in the Prospectus.)
General. In accordance with the terms of the Plans, PFD provides to the
Trust for review by the Trustees a quarterly written report of the amounts
expended under the respective Plan and the purpose for which such expenditures
were made. In the Trustees' quarterly review of the Plans, they will consider
the continued appropriateness and the level of reimbursement or compensation the
Plans provide.
No interested person of the Trust, nor any Trustee of the Trust who is
not an interested person of the Fund, has any direct or indirect financial
interest in the operation of the Plans except to the extent that PFD and certain
of its employees may be deemed to have such an interest as a result of receiving
a portion of the amounts expended under the Plans by each of the Funds and
except to the extent certain officers may have an interest in PFD's ultimate
parent, PGI.
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The Plans were adopted by a majority vote of the Board of Trustees,
including all of the Trustees who are not, and were not at the time they voted,
interested persons of the Trust, as defined in the 1940 Act (none of whom has or
have any direct or indirect financial interest in the operation of the Plans)
(the "Qualified Trustees"), cast in person at a meeting called for the purpose
of voting on the Plans. In approving the Plans, the Trustees identified and
considered a number of potential benefits which the Plans may provide. The Board
of Trustees believes that there is a reasonable likelihood that the Plans will
benefit each Fund and its current and future shareholders. Under their terms,
the Plans remain in effect from year to year provided such continuance is
approved annually by vote of the Trustees in the manner described above. The
Plans may not be amended to increase materially the annual percentage limitation
of average net assets which may be spent for the services described therein
without approval of the shareholders of the Class or Classes affected thereby,
and material amendments of the Plans must also be approved by the Trustees in
the manner described above. On March 10, 1995, the Board of Trustees approved an
amendment to the Trust's Class A Plan, on behalf of each Fund, authorizing PFD,
in its capacity as principal underwriter of the Trust's shares, to receive
compensation from the Trust pursuant to the Class A Plan. Under the original
Class A Plan, PFD served as servicing agent for the Trust with respect to the
Plan. The Board of Trustees determined that this amendment would not result in
an increase of the annual percentage limitation of average net assets which may
be spent by the Trust, on behalf of each Fund, for the services described with
respect to each Fund's Class A shares in the Class A Plan. A Plan may be
terminated at any time, without payment of any penalty, by vote of the majority
of the Trustees who are not interested persons of the Trust and have no direct
or indirect financial interest in the operations of the Plan, or by a vote of a
majority of the outstanding voting securities of the respective Class of a Fund
(as defined in the 1940 Act). A Plan will automatically terminate in the event
of its assignment (as defined in the 1940 Act). In the Trustees' quarterly
review of the Plans, they will consider the Plans' continued appropriateness and
the level of compensation they provide.
During the fiscal year ended December 31, 1994, the Funds incurred
total distribution fees pursuant to the Class A Distribution Plan as follows:
Pioneer Cash Pioneer U.S. Government Pioneer Tax-Free
Reserves Fund Money Fund Money Fund
$165,050 $36,283 $8,147
Distribution fees were paid by the Fund to PFD in reimbursement of
expenses related to servicing of shareholder accounts and to compensating
dealers and sales personnel. There were no Class B Shares outstanding on
December 31, 1994.
6. SHAREHOLDER SERVICING/TRANSFER AGENT
The Trust has contracted with PSC, 60 State Street, Boston,
Massachusetts, to act as shareholder services and transfer agent for the Trust.
This contract terminates if assigned and may be terminated without penalty by
either party by vote of its Board of Directors or Trustees or a majority of its
outstanding voting securities and the giving of ninety days' written notice.
Under the terms of its contract with the Trust, PSC services
shareholder accounts, and its duties include: (i) processing sales, redemptions
and exchanges of shares of the Trust; (ii) distributing dividends and capital
gains associated with Trust portfolio accounts; and
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(iii) maintaining account records and responding to shareholder inquiries. PSC
handles all routine communications with shareholders but obtains data processing
and operational services from Advanced Information Service Company of Boston,
Massachusetts.
PSC receives an annual fee of $28.00 per shareholder account from the
Trust as compensation for the services described above. This fee is set at an
amount determined by vote of a majority of the Trustees (including a majority of
the Trustees who are not parties to the contract with PSC or interested persons
of any such parties) to be comparable to fees for such services being paid by
other investment companies.
7. CUSTODIAN
Brown Brothers Harriman & Co. (the "Custodian"), 40 Water Street,
Boston, Massachusetts 02109, is the custodian of the Trust's assets. The
Custodian's responsibilities include safekeeping and controlling each Fund's
cash and securities, handling the receipt and delivery of securities and
collecting interest and dividends on the Funds' investments. The Custodian does
not determine the investment policies of the Funds or decide which securities
the Funds will buy or sell. The Funds may, however, invest in securities,
including repurchase agreements, issued by the Custodian and may deal with the
Custodian as principal in securities transactions. Portfolio securities may be
deposited into the Federal Reserve-Treasury Department Book Entry System or the
Depository Trust Company.
Pursuant to a separate agreement with the Custodian, the Custodian also
provides certain accounting services to the Trust, including the calculation of
yield for the Funds.
8. INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen LLP, One International Place, Boston, Massachusetts
02110, are the Trust's independent public accountants, providing audit services,
tax return review and assistance and consultation with respect to the
preparation of filings with the SEC.
9. PORTFOLIO TRANSACTIONS
The Funds intend to fully manage their portfolios by buying and selling
securities, as well as holding securities to maturity. In managing their
portfolios, the Funds seek to take advantage of market developments and yield
disparities, which may include use of the following strategies:
(1) shortening the average maturity of their portfolios in
anticipation of a rise in interest rates so as to minimize depreciation
of principal;
(2) lengthening the average maturity of their portfolios in
anticipation of a decline in interest rates so as to maximize yield;
(3) selling one type of debt security and buying another when
disparities arise in the relative values of each; and
(4) changing from one debt security to an essentially similar
debt security when their respective yields appear distorted due to
market factors.
The Funds engage in portfolio trading if they believe a transaction net
of costs (including taxes and custodian charges) will help in achieving the
Trust's investment objective.
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Decisions relating to the purchase and sale of securities for the
Funds, the allocation of portfolio transactions and, where applicable, the
negotiation of commission rates are made by officers of PMC.
The primary consideration in placing portfolio security transactions is
execution at the most favorable prices. PMC has complete freedom as to the
markets in and broker-dealers through which it seeks this result. Debt
securities are traded principally in the over-the-counter market on a net basis
through dealers acting for their own account and not as brokers. The cost of
securities purchased from underwriters includes an underwriter's commission or
concession, and the prices at which securities are purchased and sold from and
to dealers include a dealer's mark-up or mark-down. PMC attempts to negotiate
with underwriters to decrease the commission or concession for the benefit of
the Funds. PMC normally seeks to deal directly with the primary market makers
unless, in its opinion, better prices are available elsewhere. Subject to the
requirement of seeking execution at the best available price, securities may, as
authorized by PMC's management contract, be bought from or sold to dealers who
have furnished statistical research and other information or services to PMC and
the Funds. Management believes that no exact dollar value can be calculated for
such services.
During the fiscal years ended December 31, 1994, 1993 and 1992,
respectively, the Funds paid no brokerage or underwriting commissions.
10. TAX STATUS
Federal Taxes. Each series of the Trust is treated as a separate entity
for federal income tax purposes. It is each Fund's policy to meet the
requirements of Subchapter M of the Internal Revenue Code of 1986, as amended
(the "Code"), for qualification as a regulated investment company. These
requirements relate to the sources of its income, diversification of its assets
and the distribution of its income to shareholders. If a Fund meets all such
requirements and distributes to its shareholders at least annually all
investment company taxable income and net capital gain, if any, which it
receives, the Fund will be relieved of the necessity of paying federal income
tax. Because none of each Fund's income is expected to arise from dividends, no
part of the distributions to its corporate shareholders will qualify for the
dividends-received deduction for corporations. Any distribution from the excess
of a Fund's net long-term capital gain over its net short-term capital loss
would be treated by shareholders as long-term capital gain without regard to
their holding periods for their Fund shares.
Any dividend declared by a Fund in October, November or December as of
a record date in such a month and paid during the following January will be
treated for federal income tax purposes as received by shareholders on December
31 of the calendar year in which it is declared.
For federal income tax purposes, a Fund is permitted to carry forward a
net realized capital loss in any year to offset its realized capital gains, if
any, during the eight years following the year of the loss. To the extent
subsequent net realized capital gains are offset by such losses, they would not
result in federal income tax liability to the Fund and are not expected to be
distributed as such to shareholders. As of December 31, 1994, Pioneer Cash
Reserves Fund had a net capital loss carryforward of $275,424, which
carryforward will expire in 2002 if not utilized.
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Different tax treatment, including penalties on certain excess
contributions and deferrals, certain pre-retirement and post-retirement
distributions and certain prohibited transactions, is accorded to accounts
maintained as qualified retirement plans. Shareholders should consult their tax
advisers for more information.
Provided that each Fund qualifies as a regulated investment company
("RIC") under the Code, it will not be required to pay any Massachusetts income,
corporate excise or franchise taxes. Provided that each Fund qualifies as an RIC
and meets certain income source requirements under Delaware Law, each Fund
should also not be required to pay Delaware corporation income tax.
It is possible that some states will exempt from tax that portion of an
ordinary dividend which represents interest received by Pioneer U.S. Government
Money Fund or Pioneer Cash Reserves Fund on direct obligations of the U.S.
Government. Therefore, such Funds will report annually to their shareholders the
percentage of interest income received during the preceding year, indicating the
source of such income. Each shareholder is advised to consult his own tax
adviser regarding the tax status of distributions from and an investment in a
Fund under applicable state or local tax law, including, in those states or
localities that impose taxes on intangible personal property, whether the
portion of the value of a Fund's shares attributable to direct obligations of
the U.S. government may be exempt from such taxes.
Federal law requires that the Funds withhold 31% of reportable
payments, including dividends, to shareholders who have not complied with IRS
regulations. In order to avoid this withholding requirement, shareholders must
certify on their Applications, or on separate W-9 Forms, that the Social
Security Number or other Taxpayer Identification Number they provide is their
correct number and that they are not currently subject to backup withholding, or
that they are exempt from backup withholding. A Fund may nevertheless be
required to withhold if it receives notice from the IRS or a broker that the
number provided is incorrect or backup withholding is applicable as a result of
previous underreporting of interest or dividend income.
The description above relates only to U.S. federal income tax
consequences for shareholders who are U.S. persons, i.e., U.S. citizens or
residents, or U.S. corporations, partnerships, trusts or estates and who are
subject to U.S. federal income tax. Investors other than U.S. persons may be
subject to different U.S. tax treatment, including a 30% U.S. withholding tax
(or withholding tax at a lower treaty rate) on certain dividends treated as
ordinary income. The description above also does not address the special tax
rules applicable to certain classes of investors, such as banks, insurance
companies or tax-exempt entities. Shareholders should consult their own tax
advisers on these matters and on state, local and other applicable tax laws.
11. DESCRIPTION OF SHARES
The Trust's Agreement and Declaration of Trust permits the Board of
Trustees to authorize the issuance of an unlimited number of full and fractional
shares of beneficial interest (without par value) which may be divided into such
separate series as the Trustees may establish. Currently, the Trust consists of
the two series named herein. In addition to Pioneer Cash Reserves Fund and
Pioneer U.S. Government Money Fund, the Trust previously offered a third series,
Pioneer Tax-Free Money Fund, which is expected to cease operations on or about
January 8, 1996 pursuant to a Plan of Liquidation approved by the Trustees. The
Trustees may establish additional series of shares in the future, and may divide
or combine the shares into a greater or lesser number of shares without thereby
changing the proportionate beneficial interests in the Trust. The Agreement and
Declaration of Trust further authorizes the Trustees to classify or reclassify
any
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series of the shares into one or more classes. Pursuant thereto, the Trustees
have authorized the issuance of two classes of shares of Pioneer Cash Reserves
Fund, Class A shares and Class B shares. Each share of a class of the Pioneer
Cash Reserves Fund represents an equal proportionate interest in the assets of
that Fund allocable to that class. Upon liquidation of the Pioneer Cash Reserves
Fund, shareholders of each class of the Fund are entitled to share pro rata in
the Fund's net assets allocable to such class available for distribution to
shareholders. The Trust reserves the right to create and issue additional series
or classes of shares, in which case the shares of each class of a series would
participate equally in the earnings, dividends and assets allocable to that
class of the particular series.
Shareholders are entitled to one vote for each share held and may vote
in the election of Trustees and on other matters submitted to meetings of
shareholders. Although Trustees are not elected annually by the shareholders,
shareholders have, under certain circumstances, the right to remove one or more
Trustees. No amendment adversely affecting certain rights of shareholders may be
made to the Trust's Agreement and Declaration of Trust without the affirmative
vote of a majority of its shares. Shares have no preemptive or conversion
rights. Shares are fully paid and nonassessable by the Trust, except as stated
below.
12. CERTAIN LIABILITIES
As a Delaware business trust, the Trust's operations are governed by
its Agreement and Declaration of Trust dated March 7, 1995. A copy of the
Trust's Certificate of Trust, also dated March 7, 1995, is on file with the
Office of the Secretary of State of the State of Delaware. Generally, Delaware
business trust shareholders are not personally liable for obligations of the
Delaware business trust under Delaware law. The Delaware Business Trust Act (the
"Delaware Act") provides that a shareholder of a Delaware business trust shall
be entitled to the same limitation of liability extended to shareholders of
private for-profit corporations. The Trust's Agreement and Declaration of Trust
expressly provides that the Trust has been organized under the Delaware Act and
that the Agreement and Declaration of Trust is to be governed by Delaware law.
It is nevertheless possible that a Delaware business trust, such as the Trust,
might become a party to an action in another state whose courts refused to apply
Delaware law, in which case the trust's shareholders could be subject to
personal liability.
To guard against this risk, the Agreement and Declaration of Trust (i)
contains an express disclaimer of shareholder liability for acts or obligations
of the Trust and provides that notice of such disclaimer may be given in each
agreement, obligation and instrument entered into or executed by the Trust or
its Trustees, (ii) provides for the indemnification out of Trust property of any
shareholders held personally liable for any obligations of the Trust or any
series of the Trust and (iii) provides that the Trust shall, upon request,
assume the defense of any claim made against any shareholder for any act or
obligation of the Trust and satisfy any judgment thereon. Thus, the risk of a
Trust shareholder incurring financial loss beyond his or her investment because
of shareholder liability is limited to circumstances in which all of the
following factors are present: (1) a court refused to apply Delaware law; (2)
the liability arose under tort law or, if not, no contractual limitation of
liability was in effect; and (3) the Trust itself would be unable to meet its
obligations. In the light of Delaware law, the nature of the Trust's business
and the nature of its assets, the risk of personal liability to a Fund
shareholder is remote.
The Agreement and Declaration of Trust further provides that the Trust
shall indemnify each of its Trustees and officers against liabilities and
expenses reasonably incurred by them, in connection with, or arising out of, any
action, suit or proceeding, threatened against or otherwise involving such
Trustee or officer, directly or indirectly, by reason of being or having been a
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Trustee or officer of the Trust. The Agreement and Declaration of Trust does not
authorize the Trust to indemnify any Trustee or officer against any liability to
which he or she would otherwise be subject by reason of or for willful
misfeasance, bad faith, gross negligence or reckless disregard of such person's
duties.
13. DETERMINATION OF NET ASSET VALUE
The net asset value per share of each class of each Fund in the Trust
is determined 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. As of the date of this Statement of Additional
Information, these institutions are open for business every weekday except for
the following holidays: New Year's Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day. The net
asset value per share of each class of each Fund is also determined twice daily,
at 12:00 noon Eastern Time and as of the close of regular trading on the
Exchange, if the Exchange was open, on any other day in which the level of
trading in its portfolio securities is sufficiently high that the current net
asset value per share might be materially affected by changes in the value of
its portfolio securities. On any day in which no purchase orders for the shares
of a Fund become effective and no shares are tendered for redemption, such
Fund's net asset value per share may not be determined.
The net asset value per share of each class of each Fund is computed by
taking the amount of the value of all of a Fund's assets attributable to a
class, less its liabilities attributable to a class, and dividing it by the
number of outstanding shares of that class. For purposes of determining net
asset value, expenses of each class of each Fund are accrued twice daily, at
12:00 noon Eastern Time and as of the close of regular trading on the Exchange,
and taken into account.
Except as set forth in the following paragraph, each Fund's portfolio
investments are valued on each business day on the basis of amortized cost, if
the Board of Trustees determines in good faith that such method approximates
fair value. This technique involves valuing an instrument at its cost and,
thereafter, assuming a constant amortization to maturity of any discount or
premium, regardless of the impact of fluctuating interest rates on the market
value of the instrument. While this method provides certainty in valuation, it
may result in periods during which value, as determined by amortized cost, is
higher or lower than the price such Fund would receive if it sold the
investment. During periods of declining interest rates, the yield on shares of
the Funds computed as described below may tend to be higher than a like
computation made by a fund with identical investments utilizing a method of
valuation based upon market prices and estimates of market prices for all of its
portfolio investments. Thus, if the use of amortized cost by the Funds resulted
in a lower aggregate portfolio value on a particular day, a prospective investor
in a Fund would be able to obtain a somewhat higher yield than would result from
investment in a fund utilizing solely market values. The converse would apply in
a period of rising interest rates.
Standby commitments will be valued at zero in determining net asset
value. "When-issued" securities will be valued at the value of the security at
the time the commitment to purchase is entered into.
The valuation of the Funds' portfolio investments based upon their
amortized cost and the concomitant expectation to maintain the Funds' per share
net asset value of $1.00 is permitted in accordance with Rule 2a-7 under the
1940 Act pursuant to which the Funds must adhere to certain conditions which are
described in detail in the Prospectus. The Funds must maintain a dollar-weighted
average portfolio maturity of 90 days or less. The maturities of variable rate
demand
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instruments held in the Funds' portfolios will be deemed to be the longer of the
demand period or the period remaining until the next interest rate adjustment,
although stated maturities may be in excess of one year. The Trustees have
established procedures designed to stabilize, to the extent reasonably possible,
the price per share of each class of each Fund for the purpose of maintaining
sales and redemptions at a single value. It is the intention of each Fund to
maintain each class' per-share net asset value of $1.00 but there can be no
assurance of this. Such procedures will include review of the Funds' portfolio
holdings by the Trustees, at such intervals as they may deem appropriate, to
determine whether the Funds' net asset value per class calculated by using
available market quotations deviates from $1.00 per share and, if so, whether
such deviation may result in material dilution or is otherwise unfair to
existing shareholders. In the event the Trustees determine that such a deviation
exists, they have agreed to take such corrective action as they regard as
necessary and appropriate, including: (i) the sale of portfolio instruments
prior to maturity to realize capital gains or losses or to shorten average
portfolio maturity; (ii) withholding dividends; (iii) redeeming shares in kind;
or (iv) establishing a net asset value per share by using available market
quotations.
14. SYSTEMATIC WITHDRAWAL PLAN
The Systematic Withdrawal Plan is designed to provide a convenient
method of receiving fixed payments at regular intervals from shares of any Fund
in the Trust deposited by the applicant under this Plan. Withdrawals from Class
B share accounts are limited to 10% of the value of the account at the time the
plan is implemented (see the Prospectus). You must deposit or purchase for
deposit with PSC shares of any Fund having a total value of not less than
$10,000. Periodic payments of $50 or more will be deposited monthly or quarterly
directly into a bank account designated by you, or will be sent to you, or any
person designated by you.
Any income dividends or capital gains distributions on shares under the
Systematic Withdrawal Plan will be credited to the Plan account on the payment
date in full and fractional shares at the net asset value per share in effect on
the record date.
Systematic Withdrawal Plan payments are made from the proceeds of the
redemption of shares deposited under the Plan in a Plan account. To the extent
that such redemptions for periodic withdrawals exceed dividend income reinvested
in the Plan account, such redemptions will reduce and may ultimately exhaust the
number of shares deposited in the Plan account. In addition, the amounts
received by a shareholder cannot be considered as an actual yield or income on
his or her investment because part of such payments may be a return of his or
her capital.
The Systematic Withdrawal Plan may be terminated at any time (1) by
written notice to PSC or from PSC to the shareholder; (2) upon receipt by PSC of
appropriate evidence of the shareholder's death; or (3) when all shares under
the Plan have been redeemed. The fees of PSC for maintaining Systematic
Withdrawal Plans are paid by the Trust.
15. INVESTMENT RESULTS
From time to time, the Funds will provide yield quotations for Class A
and Class B shares. These quotations are calculated by standard methods
prescribed by the SEC and may from time to time be used in the Funds'
Prospectus, Statement of Additional Information, advertisements, shareholder
reports or other communications to shareholders. However, these yield quotations
should not be considered as representative of the performance of the Funds in
the future since, unlike some bank deposits or other investments which pay a
fixed yield for a stated period of time,
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the yields of the Funds will vary based on the type, quality and maturities of
the securities held in their portfolios, fluctuations in short-term interest
rates and changes in their expenses.
The Funds' yield quotations are computed using the appropriate figures
for a particular class as follows: the net change, exclusive of capital changes
(i.e., realized gains and losses from the sale of securities and unrealized
appreciation and depreciation), in the value of a hypothetical pre-existing
Class A or B share account having a balance of one share at the beginning of the
seven-day base period is determined by subtracting a hypothetical charge
reflecting expense deductions from the hypothetical account, and dividing the
net change in value by the value of the share at the beginning of the base
period. This base period return is then multiplied by 365/7 with the resulting
yield figure carried to the nearest 100th of 1%. The determination of net change
in account value reflects the value of additional shares purchased with
dividends from the original share, dividends declared on both the original share
and any such additional shares, and all fees that are charged to the Fund, in
proportion to the length of the base period and the Fund's average account size
(with respect to any fees that vary with the size of an account).
The Funds may also advertise quotations of effective yield. Effective
yield is computed by compounding the unannualized base period return determined
as in the preceding paragraph by adding 1 to the base period return, raising the
sum to a power equal to 365 divided by 7, and subtracting one from the result,
according to the following formula:
Effective Yield = (base period return + 1) 365/7 - 1
The yield and effective yield of the Funds for the seven-day period
ended December 31, 1994 are as follows:
Before Expense Limitation After Expense Limitation
Effective Effective
Class A Shares Yield Yield Yield Yield
Pioneer Cash
Reserves Fund 4.64% 4.75% 4.91% 5.03%
Pioneer U.S.
Government Money
Fund 4.24% 4.34% 5.03% 5.15%
Class B shares are a new class of shares first offered on the date hereof for
Pioneer Cash Reserves Fund only.
Automated Information Line. FactFoneSM, Pioneer's 24-hour automated
information line, allows shareholders to dial toll-free 1-800-225-4321 and hear
recorded fund information, including:
o net asset value prices for all Pioneer mutual funds;
o annualized 30-day yields on Pioneer's fixed income funds;
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o annualized 7-day yields and 7-day effective (compound) yields for
Pioneer's money market funds; and
o dividends and capital gains distributions on all Pioneer mutual funds.
Yields are calculated in accordance with SEC mandated standard
formulas.
In addition, by using a personal identification number ("PIN"),
shareholders may enter purchases, exchanges and redemptions, access their
account balance and last three transactions and may order a duplicate statement.
See "FactFoneSM" in the Prospectus for more information.
All performance numbers communicated through FactFoneSM represent past
performance, and figures for all quoted bond funds include the maximum
applicable sales charge. A shareholder's actual yield and total return will vary
with changing market conditions. The value of shares (except for Pioneer money
market funds, which seek a stable $1.00 share price) will also vary and may be
worth more or less at redemption than their original cost.
16. FINANCIAL STATEMENTS
The Fund's financial statements for the fiscal year ended December 31,
1994 attached hereto have been included in reliance upon the report of Arthur
Andersen, LLP, independent public accountants, given on their authority as
expert in account and auditing. The Fund's 1994 Annual Report to Shareholders is
incorporated by reference into this Statement of Additional Information.
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APPENDIX A
Description of Commercial Paper Ratings1
Moody's Investors Service, Inc.
Commercial Paper
P-1: P-1 is the highest commercial paper rating assigned by Moody's.
Among the factors considered by Moody's in assigning ratings are the following:
(i) evaluation of the management of the issuer; (ii) economic evaluation of the
issuer's industry or industries and an appraisal of speculative-type risks which
may be inherent in certain areas; (iii) evaluation of the issuer's products in
relation to competition and customer acceptance; (iv) liquidity; (v) amount and
quality of long-term debt; (vi) trend of earnings over a period of ten years;
(vii) financial strength of any parent company and the relationships which exist
with the issuer; and (viii) recognition by management of the issuer of
obligations which may be present or may arise as a result of public interest
questions and preparations to meet such obligations.
Standard & Poor's Ratings Group
Commercial Paper
A-1: Commercial paper rated A-1 or better has the following
characteristics: (i) the liquidity ratio of its issuer is adequate to meet cash
requirements; (ii) its issuer has outstanding debt rated AA or better; (iii) the
issuer has access to at least two additional sources of borrowing; and (iv) the
issuer's basic earnings and cash flow have an upward trend with allowance made
for unusual circumstances. Typically, the issuer's industry is judged to be well
established and the issuer has a strong position within the industry.
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1The ratings indicated herein are believed to be the most recent ratings
available at the date of this Prospectus for the securities listed. Ratings are
generally given to securities at the time of issuance. While the rating agencies
may from time to time revise such ratings, they undertake no obligation to do
so, and the ratings indicated do not necessarily represent ratings which will be
given to these securities on the date of a Fund's fiscal year-end.
<PAGE>
APPENDIX B
Other Pioneer Information
The Pioneer group of mutual funds was established in 1928 with the
creation of Pioneer Fund. Pioneer is one of the oldest, most respected and
successful money managers in the United States.
As of December 31, 1994, PMC employed a professional investment staff
of 46, with a combined average of 14 years' experience in the financial services
industry.
Total assets for all Pioneer funds at December 31, 1994 were
approximately $10,037,952,211 representing 583,478 non-retirement accounts and
337,050 retirement accounts. At December 31, 1994, there were 12,908, 921 and
391 non-retirement shareholder accounts in Pioneer Cash Reserves Fund, Pioneer
U.S. Government Money Fund and Pioneer Tax-Free Money Fund, respectively, and
there were 1,965, 815 and 7 retirement accounts for Pioneer Cash Reserves Fund
and Pioneer U.S. Government Money Fund and Pioneer Tax-Free Money Fund,
respectively.
