As filed with the Securities and Exchange Commission on July 1, 2005
File No. 333-_______
United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. _______
Post-Effective Amendment No. ______
(Check appropriate box or boxes)
PIONEER BOND FUND
(Exact Name of Registrant as Specified in Charter)
(617) 742-7825
(Area Code and Telephone Number)
60 State Street, Boston, Massachusetts 02109
(Address of Principal Executive Offices: Number, Street, City, State, Zip Code)
Dorothy E. Bourassa, Esq.
Pioneer Investment Management, Inc.
60 State Street
Boston, Massachusetts 02109
(Name and Address of Agent for Service)
Copies to: David C. Phelan, Esq.
Wilmer Cutler Pickering Hale and Dorr LLP
60 State Street
Boston, Massachusetts 02109
Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.
Calculation of Registration Fee under the Securities Act of 1933: No filing fee is due because of reliance on Section 24(f) of the Investment Company Act of 1940, which permits registration of an indefinite number of securities.
Title of Securities Being Registered: Shares of beneficial interest of the Registrant.
It is proposed that this registration statement will become effective on August 1, 2005, pursuant to Rule 488 under the Securities Act of 1933, as amended.
COMBINED PROXY STATEMENT OF
AMSOUTH FUNDS
on behalf of its Series:
AMSOUTH CAPITAL GROWTH FUND
AMSOUTH LARGE CAP FUND
AMSOUTH ENHANCED MARKET FUND
AMSOUTH VALUE FUND
AMSOUTH MID CAP FUND
AMSOUTH SMALL CAP FUND
AMSOUTH INTERNATIONAL EQUITY FUND
AMSOUTH SELECT EQUITY FUND
AMSOUTH BALANCED FUND
AMSOUTH STRATEGIC PORTFOLIOS: AGGRESSIVE GROWTH PORTFOLIO
AMSOUTH STRATEGIC PORTFOLIOS: GROWTH PORTFOLIO
AMSOUTH STRATEGIC PORTFOLIOS: GROWTH AND INCOME PORTFOLIO
AMSOUTH STRATEGIC PORTFOLIOS: MODERATE GROWTH AND INCOME PORTFOLIO
AMSOUTH HIGH QUALITY BOND FUND
AMSOUTH FLORIDA TAX-EXEMPT FUND
AMSOUTH HIGH QUALITY MUNICIPAL BOND FUND
AMSOUTH TENNESSEE TAX-EXEMPT FUND
AMSOUTH GOVERNMENT INCOME FUND
AMSOUTH LIMITED TERM BOND FUND
AMSOUTH TREASURY RESERVE MONEY MARKET FUND
AMSOUTH PRIME MONEY MARKET FUND
AMSOUTH TAX-EXEMPT MONEY MARKET FUND
AMSOUTH INSTITUTIONAL PRIME OBLIGATIONS MONEY MARKET FUND
(each, an "AmSouth Fund" and collectively, the "AmSouth Funds")
The address and telephone number of each AmSouth Fund is:
3435 Stelzer Road, Columbus, OH 43219
1-800-451-8382
PROSPECTUS FOR CLASS A, CLASS B AND CLASS Y SHARES OF
PIONEER OAK RIDGE LARGE CAP GROWTH FUND
PIONEER FUND
PIONEER VALUE FUND
PIONEER MID CAP VALUE FUND
PIONEER GROWTH OPPORTUNITIES FUND
PIONEER INTERNATIONAL CORE EQUITY FUND
PIONEER FOCUSED EQUITY FUND
PIONEER CLASSIC BALANCED FUND
PIONEER IBBOTSON AGGRESSIVE ALLOCATION FUND
PIONEER IBBOTSON GROWTH ALLOCATION FUND
PIONEER IBBOTSON MODERATE ALLOCATION FUND
PIONEER BOND FUND
PIONEER FLORIDA TAX FREE INCOME FUND
PIONEER TAX FREE INCOME FUND
PIONEER AMERICA INCOME TRUST
PIONEER SHORT TERM INCOME FUND
PIONEER CASH RESERVES FUND
PIONEER TAX FREE MONEY MARKET FUND
PROSPECTUS FOR CLASS 1, CLASS 2 AND CLASS 3 SHARES OF
PIONEER INSTITUTIONAL MONEY MARKET FUND
(each, a "Pioneer Fund" and collectively, the "Pioneer Funds")
The address and telephone number of each Pioneer Fund is:
60 State Street, Boston, Massachusetts 02109
1-800-225-6292
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
SCHEDULED FOR [ ], 2005
To the Shareholders of the AmSouth Funds:
A joint special meeting of shareholders (the "Meeting") for each of the AmSouth Funds will be held at the offices of [ ], [ ], on [ ]at [ ] [a/p].m., local time, to consider the following:
1. With respect to each AmSouth Fund, a proposal to approve an Agreement and Plan of Reorganization. Under the Agreement and Plan of Reorganization applicable to your AmSouth Fund, it will transfer all of its assets to an investment company or a series thereof (each a "Pioneer Fund") managed by Pioneer Investment Management, Inc. ("Pioneer") in exchange for Class A, B and Y shares of the Pioneer Fund (or, in the case of Pioneer Institutional Money Market Fund, Class 1, 2 and 3 shares). Class A, B and Y shares of the Pioneer Fund will be distributed to each AmSouth Fund's shareholders in proportion to their Class A, B and I share holdings on the reorganization date. In the case of Pioneer Institutional Money Market Fund, Class 1, 2 and 3 shares will be distributed in exchange for Institutional Class 1 shares, Institutional Class 2 shares and Institutional Class 3 shares of AmSouth Institutional Money Market Fund. The Pioneer Fund also will assume your AmSouth Fund's liabilities that are included in the calculation of your AmSouth Fund's net asset value on the closing date at the reorganization. In the case of certain AmSouth Funds, the Pioneer Fund is an existing mutual fund with a substantially similar investment objective and similar investment policies as your AmSouth Fund. In the case of other AmSouth Funds, the Pioneer Fund is a newly organized mutual fund with a substantially similar investment objective and similar investment policies as your AmSouth Fund. Following the reorganization, your AmSouth Fund will then be dissolved. As a result of the reorganization, you will become shareholders of the Pioneer Fund. Your board of trustees recommends that you vote FOR this proposal.
2. Any other business that may properly come before the Meeting.
Shareholders of record as of the close of business on [ ], 2005, are entitled to vote at the Meeting and any related follow-up meetings.
Whether or not you expect to attend the Meeting, please complete and return the enclosed proxy card. If shareholders do not return their proxies in sufficient numbers, your AmSouth Fund may be required to make additional solicitations.
By order of the Board of Trustees,
[ ]
[Chairman]
[ ], 2005
COMBINED PROXY STATEMENT OF
AMSOUTH FUNDS
on behalf of its Series:
AMSOUTH CAPITAL GROWTH FUND
AMSOUTH LARGE CAP FUND
AMSOUTH ENHANCED MARKET FUND
AMSOUTH VALUE FUND
AMSOUTH MID CAP FUND
AMSOUTH SMALL CAP FUND
AMSOUTH INTERNATIONAL EQUITY FUND
AMSOUTH SELECT EQUITY FUND
AMSOUTH BALANCED FUND
AMSOUTH STRATEGIC PORTFOLIOS: AGGRESSIVE GROWTH PORTFOLIO
AMSOUTH STRATEGIC PORTFOLIOS: GROWTH PORTFOLIO
AMSOUTH STRATEGIC PORTFOLIOS: GROWTH AND INCOME PORTFOLIO
AMSOUTH STRATEGIC PORTFOLIOS: MODERATE GROWTH AND INCOME PORTFOLIO
AMSOUTH HIGH QUALITY BOND FUND
AMSOUTH FLORIDA TAX-EXEMPT FUND
AMSOUTH HIGH QUALITY MUNICIPAL BOND FUND
AMSOUTH TENNESSEE TAX-EXEMPT FUND
AMSOUTH GOVERNMENT INCOME FUND
AMSOUTH LIMITED TERM BOND FUND
AMSOUTH TREASURY RESERVE MONEY MARKET FUND
AMSOUTH PRIME MONEY MARKET FUND
AMSOUTH TAX-EXEMPT MONEY MARKET FUND
AMSOUTH INSTITUTIONAL PRIME OBLIGATIONS MONEY MARKET FUND
(each, an "AmSouth Fund" and collectively, the "AmSouth Funds")
The address and telephone number of each AmSouth Fund is:
3435 Stelzer Road, Columbus, OH 43219
1-800-451-8382
PROSPECTUS
FOR CLASS A, CLASS B AND CLASS Y SHARES OF
PIONEER OAK RIDGE LARGE CAP GROWTH FUND
PIONEER FUND
PIONEER VALUE FUND
PIONEER MID CAP VALUE FUND
PIONEER GROWTH OPPORTUNITIES FUND
PIONEER INTERNATIONAL CORE EQUITY FUND
PIONEER FOCUSED EQUITY FUND
PIONEER CLASSIC BALANCED FUND
PIONEER IBBOTSON AGGRESSIVE ALLOCATION FUND
PIONEER IBBOTSON GROWTH ALLOCATION FUND
PIONEER IBBOTSON MODERATE ALLOCATION FUND
PIONEER BOND FUND
PIONEER FLORIDA TAX FREE INCOME FUND
PIONEER TAX FREE INCOME FUND
PIONEER AMERICA INCOME TRUST
PIONEER SHORT TERM INCOME FUND
PIONEER CASH RESERVES FUND
PIONEER TAX FREE MONEY MARKET FUND
PROSPECTUS
FOR CLASS 1, CLASS 2 AND CLASS 3 SHARES OF
PIONEER INSTITUTIONAL MONEY MARKET FUND
(each, a "Pioneer Fund" and collectively, the "Pioneer Funds")
The address and telephone number of each Pioneer Fund is:
60 State Street, Boston, Massachusetts 02109
and 1-800-225-6292
Shares of the Pioneer Funds have not been approved or disapproved by the Securities and Exchange Commission (the "SEC"). The SEC has not passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
An investment in any AmSouth Fund or Pioneer Fund (each sometimes referred to herein as a "Fund") is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.
This combined proxy statement and prospectus (the "Proxy Statement/Prospectus"), dated [ ], 2005, is being furnished to shareholders of the AmSouth Funds in connection with the solicitation by the board of trustees (the "Board", or the "Trustees") of the AmSouth Funds of proxies to be used at a joint meeting of shareholders of the AmSouth Funds (the "Meeting") to be held at the offices of [ ], [ ], on [ ], 2005 at [ ] [a/p].m., local time. Each AmSouth Fund is a series of AmSouth Funds, an open-end management investment company organized as a Massachusetts business trust. Each Pioneer Fund is an open-end management investment company, or a series thereof, organized as either a Delaware statutory trust or a Massachusetts business trust.
The Proxy Statement/Prospectus contains information you should know before voting on the approval of a proposed Agreement and Plan of Reorganization (each a "Plan") that provides for the reorganization of each AmSouth Fund into a corresponding Pioneer Fund (each a "Reorganization"). The following table indicates (a) the corresponding Pioneer Fund shares that each AmSouth Fund shareholder would receive if each Plan is approved, (b) which AmSouth Fund shareholders may vote on which proposals and on what page of this Proxy Statement/Prospectus the discussion regarding each proposal begins. On each proposal, all shareholders of an AmSouth Fund, regardless of the class of shares held, will vote together as a single class. Although each Reorganization is similar in structure, you should read carefully the specific discussion regarding your AmSouth Fund's Reorganization.
The Proxy Statement/Prospectus sets forth the information about the Pioneer Fund that a prospective investor ought to know before investing and should be retained for future reference. Additional information about each Pioneer Fund has been filed with the SEC and is available upon oral or written request and without charge. See "Where to Get More Information."
------------------------------------------------------------------------------------------------------------------------------
AmSouth Fund Pioneer Fund Shareholders Entitled to Vote Page
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(a) AmSouth Capital Growth Pioneer Oak Ridge AmSouth Capital Growth Fund
Fund Large Cap Growth Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(b) AmSouth Large Cap Fund Pioneer Oak Ridge AmSouth Large Cap Fund shareholders
Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Fund Pioneer Fund Shareholders Entitled to Vote Page
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(c) AmSouth Enhanced Market Pioneer Fund AmSouth Enhanced Market Fund
Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(d) AmSouth Value Fund Pioneer Value Fund AmSouth Value Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(e) AmSouth Mid Cap Fund Pioneer Mid Cap Value AmSouth Mid Cap Fund shareholders
Fund
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(f) AmSouth Small Cap Fund Pioneer Growth AmSouth Small Cap Fund shareholders
Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(g) AmSouth International Pioneer International AmSouth International Equity Fund
Equity Fund Core Equity Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(h) AmSouth Select Equity Pioneer Focused AmSouth Select Equity Fund
Fund Equity Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(i) AmSouth Balanced Fund Pioneer Classic AmSouth Balanced Fund shareholders
Balanced Fund
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(j) AmSouth Strategic Pioneer Ibbotson AmSouth Strategic Aggressive Growth
Portfolios: Aggressive Aggressive Allocation Portfolio shareholders
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(k) AmSouth Strategic Pioneer Ibbotson AmSouth Strategic Growth Portfolio
Portfolios: Growth Growth Allocation Fund shareholders
Portfolio
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(l) AmSouth Strategic Pioneer Ibbotson AmSouth Strategic Growth and Income
Portfolios: Growth and Moderate Allocation Portfolio shareholders
Income Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(m) AmSouth Strategic Pioneer Ibbotson AmSouth Strategic Moderate Growth &
Portfolios: Moderate Moderate Allocation Income Portfolio shareholders
Growth & Income Fund
Portfolio
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(n) AmSouth High Quality Pioneer Bond Fund AmSouth High Quality Bond Fund
Bond Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(o) AmSouth Florida Pioneer Florida Tax AmSouth Florida Tax-Exempt Fund
Tax-Exempt Fund Free Income Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(p) AmSouth High Quality Pioneer Tax Free AmSouth High Quality Municipal Bond
Municipal Bond Fund Income Fund Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(q) AmSouth Tennessee Pioneer Tax Free AmSouth Tennessee Tax-Exempt Fund
Tax-Exempt Fund Income Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(r) AmSouth Government Pioneer America AmSouth Government Income Fund
Income Fund Income Trust shareholders
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Fund Pioneer Fund Shareholders Entitled to Vote Page
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(s) AmSouth Limited Term Pioneer Short Term AmSouth Limited Term Bond Fund
Bond Fund Income Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(t) AmSouth Treasury Pioneer Cash Reserves AmSouth Treasury Reserve Money Market
Reserve Money Market Fund Fund shareholders
Fund
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(u) AmSouth Prime Money Pioneer Cash Reserves AmSouth Prime Money Market Fund
Market Fund Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(v) AmSouth Tax-Exempt Pioneer Tax Free AmSouth Tax-Exempt Money Market Fund
Money Market Fund Money Market Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
PROPOSAL 1(w) AmSouth Institutional Pioneer Institutional AmSouth Institutional Prime
Prime Obligations Money Money Market Fund Obligations Money Market Fund
Market Fund shareholders
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
Where to Get More Information
------------------------------------------------------------------------------------------------------------------------------
The AmSouth Funds' prospectus dated December 1, 2004, as Available to you free of charge by calling 1-800-451-8382.
supplemented January 12, 2005, April 26, 2005, June 1, 2005 Each prospectus is also on file with the SEC.
and June 27, 2005.
The AmSouth Funds' statement of additional information dated Available to you free of charge by calling 1-800-451-8382.
December 1, 2004, as supplemented March 22, 2005. Each statement of additional information is also on file
with the SEC.
The AmSouth Funds' annual report dated July 31, 2004 and Available to you free of charge by calling 1-800-451-8382.
semiannual report dated January 31, 2005. Also on file with the SEC. See "Available Information."
------------------------------------------------------------------------------------------------------------------------------
Each Pioneer Funds' current prospectus and each Pioneer Fund's Available to you free of charge by calling 1-800-225-6292.
most recent annual and semiannual reports and supplements (as These prospectuses and reports are also on file with the
they apply) to shareholders. SEC.
------------------------------------------------------------------------------------------------------------------------------
A statement of additional information for this joint Proxy Available to you free of charge by calling 1-800-225-6292.
Statement/Prospectus (the "SAI"), dated [ ], 2005. It Also on file with the SEC. This SAI is incorporated by
contains additional information about your AmSouth Funds and reference into this Proxy Statement/Prospectus.
the Pioneer Funds.
------------------------------------------------------------------------------------------------------------------------------
To ask questions about this Proxy Statement/Prospectus. Call your AmSouth Fund's toll-free telephone number:
1-800-451-8382.
------------------------------------------------------------------------------------------------------------------------------
|
Background to the Reorganizations
AmSouth Asset Management Inc. ("AAMI") is investment adviser to the AmSouth Funds and a wholly-owned subsidiary of AmSouth Bank, which in turn is wholly owned by AmSouth Bancorporation. AmSouth Bank and AAMI have determined that engaging in the business of investment adviser to the AmSouth Funds is not a core business that AAMI intends to continue. After investigating and discussing several alternatives for ongoing investment management of the AmSouth Funds with the Trustees, AmSouth Bank and AAMI conducted a search for a buyer for AAMI's fund management business.
Ultimately, AmSouth Bank and AAMI decided to recommend to the Board that the AmSouth Funds be reorganized into similar mutual funds managed by Pioneer Investment Management, Inc. ("Pioneer").
The Board met twice in May 2005 and again in June 2005. At these meetings, your Trustees received and evaluated materials regarding Pioneer and the Pioneer Funds, including the performance record and expense structure of each of the Pioneer Funds, the impact of the proposed Reorganizations on the AmSouth Funds' shareholders, and the quality of the services offered by Pioneer. The Trustees also considered other alternatives for the ongoing management of AmSouth Funds. At a meeting on May 18, 2005, the Trustees met with representatives of Pioneer. In addition to these general factors, the Trustees also considered the factors discussed below in the context of each Reorganization. At the May 18, 2005 meeting, all of the Trustees who are not interested persons of AAMI (the "Independent Trustees") met separately in executive session with counsel to the Independent Trustees and requested and received such information from AAMI and Pioneer as they determined to be necessary and appropriate to evaluate the proposed Reorganizations. On June 23, 2005, the Board, including all of the Independent Trustees, unanimously voted to approve each of the Reorganizations. In approving the Reorganizations, the Board determined that the Reorganizations were in the best interests of the AmSouth Funds' shareholders and the interests of existing AmSouth Funds' shareholders will not be diluted as a result of the Reorganizations.
Pioneer believes that it can offer capable management and favorable long-term investment performance to the AmSouth Funds' shareholders. The Reorganizations will, by combining the assets of two mutual funds and by increasing distribution capabilities, offer the potential for increased economies of scale. Increased economies of scale have the potential of benefiting the shareholders of your AmSouth Funds and the Pioneer Funds by spreading fixed costs over a larger asset base and reducing expenses on a per share basis. There can be no assurance that such economies of scale will be realized.
Why the Trustees Are Recommending the Reorganizations
The Trustees believe that reorganizing your AmSouth Fund into a portfolio with a substantially similar investment objective and similar investment policies that is part of the Pioneer family of funds offers you potential benefits. These potential benefits and considerations include:
o AmSouth Bank and AAMI have determined that engaging in the business of investment adviser to the AmSouth Funds is not a core business that AAMI intends to continue. Therefore, a change in your AmSouth Fund's investment adviser is necessary. In the absence of the Reorganization, such change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing the fund size and increasing fund expense ratios;
o The track record of Pioneer in managing the Pioneer Funds;
o The transaction will qualify as a tax free reorganization under
Section 368(a) of the Internal Revenue Code of 1986, as amended (the
"Code") and there fore will not be treated as a taxable sale of your
AmSouth shares;
o In the case of certain AmSouth Funds, the potential for lower management fees and total expenses;
o The resources of Pioneer, including its infrastructure in shareholder services; and
o The opportunity to be part of a significantly larger family of funds, with additional product offerings and enhanced shareholder servicing options, and a stronger compliance structure.
For further information, please see the individual descriptions of the proposals contained in this Proxy Statement/Prospectus.
How Each Reorganization Will Work
o AmSouth Fund shareholder-directed exchanges and purchases made by check, [ACH], or wire will be accepted up until [ ] [a/p].m. ([ ] Time) on [ ]day, [ ], 2005. Exchange and purchase requests received after this deadline will be rejected and returned. Purchase and exchange requests made by AmSouth Fund shareholders through financial institutions or advisers must be made earlier to ensure the trade can be processed within this deadline. Financial institutions and advisers that trade electronically (NSCC) with the AmSouth Funds can place exchange and purchase requests up until [ ] [a/p].m. ([ ] Time) on [ ]day, [ ], 2005. Exchanges and purchases received after this deadline will be rejected and returned. The AmSouth Funds will not process purchases made via automatic investment method (AIM) after [ ], 2005. Dividend/capital gain reinvestment and established systematic exchanges will continue through [ ], 2005.
o Each AmSouth Fund will transfer all of its assets to a corresponding Pioneer Fund. Each Pioneer Fund will assume the corresponding AmSouth Fund's liabilities that are included in the calculation of such AmSouth Fund's net asset value on the day on which each Reorganization closes (the "Closing Date"). Liabilities of each Fund to its shareholders not assumed by a corresponding Pioneer Fund will be assumed by AmSouth Bancorporation.
o Each Pioneer Fund will issue Class A, B and Y shares to the corresponding AmSouth Fund in amounts equal to the aggregate net asset value of that AmSouth Fund's Class A, B and I shares. Shareholders of your AmSouth Fund will receive Class A, B and Y shares of the corresponding Pioneer Fund. These shares will be distributed to shareholders in proportion to the relative net asset value of their share holdings on the Closing Date. On the Closing Date, each shareholder will hold shares of the Pioneer Fund with the same aggregate net asset value as the shares of the AmSouth Fund that the shareholder held immediately prior to the Reorganization.
o Each AmSouth Fund will be dissolved after the Closing Date.
o Pioneer acts as investment adviser to each Pioneer Fund.
o The Reorganizations are intended to result in no income, gain or loss being recognized for federal income tax purposes to any of the Pioneer Funds, the AmSouth Funds or the shareholders of the AmSouth Funds.
o In recommending each of the Reorganizations, the Trustees of your AmSouth Fund have determined that the Reorganization is in the best interest of your AmSouth Fund and will not dilute the interests of shareholders of your AmSouth Fund. The Trustees have made that determination on the basis of the factors listed above and discussed in more detail under each proposal. A reorganization might not be in the best interest of the shareholders of a mutual fund if the surviving fund had higher expenses, less experienced management or the adviser did not have adequate resources to manage the affairs of the mutual fund.
o If the Reorganizations are approved, the AmSouth Funds will file with the SEC an application for deregistration on Form N-8F under the Investment Company Act of 1940, as amended (the "Investment Company Act"), and will cease to exist as an investment company when such application is approved.
Who Is Pioneer
Pioneer is registered as an investment adviser under the Investment Advisers Act of 1940, as amended, and acts as investment adviser to mutual funds and institutional accounts. Pioneer or its predecessors have been managing mutual funds since 1928 and at December 31, 2004 had, together with its affiliates, over $42 billion in assets under management. Pioneer is an indirect, wholly owned subsidiary of UniCredito Italiano S.p.A., an Italian Bank.
In addition to the Class A, B and Y shares to be issued in the Reorganization, each Pioneer Fund also offers Class C shares (subject to a contingent deferred sales charge and a Rule 12b-1 Plan). In addition, most of the Pioneer Funds also offer Class R shares (which are offered only to certain retirement plans).
Who Bears the Expenses Associated with the Reorganizations
Pioneer and AmSouth Bancorporation will pay all costs of preparing and printing the AmSouth Funds' proxy statements and solicitation costs incurred by the AmSouth Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Funds in connection with the Reorganizations.
Will Pioneer and AmSouth Bancorporation Benefit from the Reorganizations
Pioneer will benefit from managing a larger pool of assets. Pioneer is also acquiring certain assets associated with AAMI's fund management business and the benefits of certain restrictive covenants on AAMI's and AmSouth Bancorporation's activities. In consideration for the acquisition of these assets, the opportunity to manage additional assets and covenants from AmSouth Bancorporation and AAMI, including their assistance in facilitating the Reorganizations, noncompetition covenants and their obligation to indemnify Pioneer against certain liabilities, Pioneer has agreed to pay AAMI $65 million. This amount is subject to partial repayment in the event that the assets attributable to the AmSouth Funds are
redeemed (subject to certain conditions, including threshold amounts) from the Pioneer Funds within four years after the closing of the Reorganization.
Pioneer will also agree to provide an affiliate of AAMI with ongoing servicing payments with respect to the Class Y shares issued in the Reorganizations. This additional compensation will be equal on an annual basis to 0.10% of the average daily net assets attributable to the Class Y shares held by former AmSouth Funds' shareholders. This payment would be made by Pioneer and not the Pioneer Funds. No additional compensation would be paid with respect to Class A or Class B shares; however, if an affiliate of AAMI is the broker of record, that affiliate would receive the trail commissions under the Class A and Class B Rule 12 b-1 Plans.
What Happens if a Reorganization Is Not Approved
If the required approval of shareholders is not obtained, the Meeting may be adjourned as more fully described in this Proxy Statement/Prospectus, your AmSouth Fund will continue to engage in business as a separate mutual fund and the Board will consider what further action may be appropriate.
Who Is Eligible to Vote
Shareholders of record on [ ], 2005 are entitled to attend and vote at the Meeting or any adjournment of the Meeting. On each proposal, all shareholders of an AmSouth Fund, regardless of the class of shares held, will vote together as a singe class. Each share is entitled to one vote. Shares represented by properly executed proxies, unless revoked before or at the Meeting, will be voted according to shareholders' instructions. If you sign a proxy but do not fill in a vote, your shares will be voted to approve the Agreement and Plan of Reorganization. If any other business comes before the Meeting, your shares will be voted at the discretion of the persons named as proxies.
TABLE OF CONTENTS
Page
----
INTRODUCTION..............................................................................
PROPOSAL 1(a) -- AMSOUTH CAPITAL GROWTH FUND..............................................
PROPOSAL 1(b) -- AMSOUTH LARGE CAP FUND...................................................
PROPOSAL 1(c) -- AMSOUTH ENHANCED MARKET FUND.............................................
PROPOSAL 1(d) -- AMSOUTH VALUE FUND.......................................................
PROPOSAL 1(e) -- AMSOUTH MID CAP FUND.....................................................
PROPOSAL 1(f) -- AMSOUTH SMALL CAP FUND...................................................
PROPOSAL 1(g) -- AMSOUTH INTERNATIONAL EQUITY FUND........................................
PROPOSAL 1(h) -- AMSOUTH SELECT EQUITY FUND...............................................
PROPOSAL 1(i) -- AMSOUTH BALANCED FUND....................................................
PROPOSAL 1(j) -- AMSOUTH STRATEGIC PORTFOLIOS: AGGRESSIVE GROWTH PORTFOLIO................
PROPOSAL 1(k) -- AMSOUTH STRATEGIC PORTFOLIOS: GROWTH PORTFOLIO...........................
PROPOSAL 1(l) -- AMSOUTH STRATEGIC PORTFOLIOS: GROWTH AND INCOME PORTFOLIO................
PROPOSAL 1(m) -- AMSOUTH STRATEGIC PORTFOLIOS: MODERATE GROWTH AND INCOME PORTFOLIO.......
PROPOSAL 1(n) -- AMSOUTH HIGH QUALITY BOND FUND...........................................
PROPOSAL 1(o) -- AMSOUTH FLORIDA TAX-EXEMPT FUND..........................................
PROPOSAL 1(p) -- AMSOUTH HIGH QUALITY MUNICIPAL BOND FUND.................................
PROPOSAL 1(q) -- AMSOUTH TENNESSEE TAX-EXEMPT FUND........................................
PROPOSAL 1(r) -- AMSOUTH GOVERNMENT INCOME FUND...........................................
PROPOSAL 1(s) -- AMSOUTH LIMITED TERM BOND FUND...........................................
PROPOSAL 1(t) -- AMSOUTH TREASURY RESERVE MONEY MARKET FUND...............................
PROPOSAL 1(u) -- AMSOUTH PRIME MONEY MARKET FUND..........................................
PROPOSAL 1(v) -- AMSOUTH TAX-EXEMPT MONEY MARKET FUND.....................................
PROPOSAL 1(w) -- AMSOUTH INSTITUTIONAL PRIME OBLIGATIONS MONEY MARKET FUND................
TERMS OF EACH AGREEMENT AND PLAN OF REORGANIZATION........................................
TAX STATUS OF EACH REORGANIZATION.........................................................
AGREEMENT WITH PIONEER....................................................................
VOTING RIGHTS AND REQUIRED VOTE...........................................................
COMPARISON OF DELAWARE STATUTORY TRUST AND MASSACHUSETTS BUSINESS TRUST...................
ADDITIONAL INFORMATION ABOUT THE PIONEER FUNDS............................................
FINANCIAL HIGHLIGHTS......................................................................
INFORMATION CONCERNING THE MEETING........................................................
OWNERSHIP OF SHARES OF THE FUNDS..........................................................
EXPERTS...................................................................................
AVAILABLE INFORMATION.....................................................................
EXHIBIT A-1 -- FORM OF AGREEMENT AND PLAN OF REORGANIZATION
(C/D REORGANIZATIONS).....................................................................A-1
EXHIBIT A-2 -- FORM OF AGREEMENT AND PLAN OF REORGANIZATION
(F REORGANIZATIONS).......................................................................A-24
EXHIBIT B -- ADDITIONAL INFORMATION ABOUT PIONEER.........................................B-1
EXHIBIT C -- PORTFOLIO MANAGER'S DISCUSSION OF PERFORMANCE................................C-1
|
AmSouth Capital Growth Fund and Pioneer Oak Ridge Large Cap Growth Fund
PROPOSAL 1(a)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests primarily in equity securities of large capitalization issuers and, consequently, the Funds have similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Capital Growth Fund to Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Business A non-diversified series of AmSouth Funds, an A diversified series of Pioneer Series Trust
open-end management investment company I, an open-end management investment company
organized as a Massachusetts business trust. organized as a Delaware statutory trust.
------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, $251.35 million $157.9 million
2005
------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Investment Subadviser:
Day-to-day management of AmSouth Capital Oak Ridge Investments, LLC ("Oak Ridge")
Growth Fund's portfolio is the responsibility
of John Mark McKenzie (since 2004), who has Portfolio Managers:
been involved in investment management since Day-to-day management of the Fund's portfolio
1981, with portfolio management expertise in is the responsibility of David M. Klaskin
both equity and fixed income securities. Mr. (lead manager), Chairman (since 1998),
McKenzie co-managed the AmSouth Government Treasurer and Chief Investment Officer (since
Income Fund from 1999 to 2002 and managed it 1989) of Oak Ridge, and Robert G. McVicker,
from 2003 to 2004. Mr. McKenzie has been Portfolio Manager and Director of Research at
associated with the Trust Investment Oak Ridge (since 1989).
Department of AmSouth Bank, and banks acquired
by AmSouth Bank, since 1984 and joined AAMI in
2003.
Mr. McKenzie is Senior Vice President of
AmSouth Bank and AAMI.
------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Capital Growth Fund seeks to provide Pioneer Oak Ridge Large Cap Growth Fund seeks
investors with capital growth. capital appreciation.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Primary investments AmSouth Capital Growth Fund invests at least Normally, Pioneer Oak Ridge Large Cap Growth
65% of its total assets in equity securities. Fund invests at least 80% of its net assets
The Fund invests primarily in equity (plus the amount of borrowings, if any, for
securities of U.S. companies with market investment purposes) in equity securities of
capitalizations of at least $1 billion that large capitalization U.S. companies. Large
AAMI believes offer opportunities for capital capitalization companies have market
appreciation and growth of earnings. The Fund capitalizations at the time of acquisition of
also may invest in medium-sized companies. $3 billion or more. The Fund anticipates that
the average weighted market capitalization of
the companies in the Fund's portfolio will be
significantly higher than $3 billion.
The equity securities in which Pioneer Oak
Ridge Large Cap Growth Fund principally
invests are common stocks, preferred stocks,
depositary receipts and convertible debt, but
the Fund may invest in other types of equity
securities to a lesser extent, such as
warrants and rights.
------------------------------------------------------------------------------------------------------------------------------
Investment strategies In choosing stocks for AmSouth Capital Growth Pioneer Oak Ridge Large Cap Growth Fund uses a
Fund, AAMI first identifies industries that it "growth" style of management and seeks to
believes will expand over the next few years invest in issuers with above average potential
or longer. AAMI then uses fundamental analysis for earnings growth. Pioneer has engaged Oak
of company financial statements to find large Ridge to act as the Fund's subadviser under
U.S. companies within these industries that Pioneer's supervision. When making purchase
offer the prospect of solid earnings growth. decisions for the Fund, the subadviser uses a
AAMI also may consider other factors in disciplined approach that involves three
selecting investments for the Fund, including primary components:
the development of new or improved products or o Research: The subadviser analyzes
services, opportunities for greater market research on potential investments from a wide
share, more effective management or other variety of sources, including internally
signs that the company will have greater than generated analysis and research provided by
average earnings growth and capital institutions and the brokerage community. The
appreciation. subadviser seeks to supplement this analysis
with information derived from business and
trade publications, filings with the SEC,
corporate contacts, industry conferences and
discussions with company management.
o Fundamentals: Once a potential
investment is identified, the subadviser
considers whether the issuer possesses certain
attributes that the subadviser believes a
"buy" candidate should possess relating to,
among other things, (i) growth of sales and
earnings, (ii) earnings power, trends and
predictability, (iii) quality of management,
(iv) competitive position of products and/or
services, (v) fundamentals of the industry in
which the company operates and (vi) the
ability to benefit from economic and political
trends affecting the company.
o Valuation: Finally, the subadviser
values companies by considering price-to-sales
ratios and price-to-earnings ratios within a
peer group.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Other investments AmSouth Capital Growth Fund may invest in debt The Fund may invest up to 20% of its total
securities of domestic and foreign issuers assets in equity and debt securities of
when AAMI believes that such securities offer non-U.S. corporate issuers and debt securities
opportunities for capital growth. The Fund may of non-U.S. government issuers.
invest up to 10% of its total assets in
foreign securities which are not publicly The Fund will not invest more than 5% of its
traded in the United States. total assets in the securities of emerging
markets issuers.
At least 65% of the Fund's total assets
invested in debt securities must consist of
debt securities which are rated no lower than
investment grade (Baa/BBB) by a credit rating
agency, or, if unrated, deemed to be of
comparable quality by AAMI. The remainder of
such assets may be invested in debt
securities which are rated no lower than Ba
by Moody's Investors Service, Inc. and BB by
Standard & Poor's Ratings Group ("S&P") or
Fitch, Inc. or, if unrated, deemed to be of
comparable quality by AAMI.
------------------------------------------------------------------------------------------------------------------------------
Temporary defensive When AAMI determines adverse market conditions Pioneer Oak Ridge Large Cap Growth Fund
strategies exist, AmSouth Capital Growth Fund may invest may invest all or part of its assets in
entirely in cash positions, directly in U.S. securities with remaining maturities of less
Government securities and short-term paper, than one year, cash equivalents or may hold
such as bankers' acceptances. cash.
------------------------------------------------------------------------------------------------------------------------------
Diversification AmSouth Capital Growth Fund is non-diversified Pioneer Oak Ridge Large Cap Growth Fund is
for the purpose of the Investment Company Act diversified for the purpose of the Investment
and, therefore, may concentrate its Company Act and is subject to diversification
investments in a limited number of issuers. requirements under the Internal Revenue Code
of 1986, as amended (the "Code").
------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Capital Growth Fund may not purchase Pioneer Oak Ridge Large Cap Growth Fund may
any securities which would cause more than 25% not invest more than 25% of its assets in any
of the value of the Fund's total assets at the one industry.
time of purchase to be invested in securities
of one or more issuers conducting their
principal business activities in the same
industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the U.S.
government or its agencies or instrumentalities;
(b) wholly owned finance companies will be
considered to be in the industries of their
parents if their activities are primarily
related to financing the activities of their
parents; and (c) utilities will be divided
according to their services. For example, gas,
gas transmission, electric and gas, electric,
and telephone will each be considered a
separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental user.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Capital Growth Fund may not invest Pioneer Oak Ridge Large Cap Growth Fund may
securities more than 15% of its net assets in securities not invest more than 15% of its net assets in
that are restricted as to resale, or for which securities that are illiquid and other
no readily available market exists, including securities that are not readily marketable.
repurchase agreements providing for settlement Repurchase agreements maturing in more than
more than seven days after notice. seven days will be included for purposes of
the foregoing limit.
------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Capital Growth Fund may not borrow Pioneer Oak Ridge Large Cap Growth Fund may
money or issue senior securities, except that not borrow money, except the Fund may: (a)
the Fund may borrow from banks or enter into borrow from banks or through reverse
reverse repurchase agreements for temporary repurchase agreements in an amount up to 33
emergency purposes in amounts up to 33 1/3% of 1/3% of the Fund's total assets (including the
the value of its total assets at the time of amount borrowed); (b) to the extent permitted
such borrowing. The Fund will not purchase by applicable law, borrow up to an additional
securities while borrowings (including reverse 5% of the Fund's assets for temporary
repurchase agreements) in excess of 5% of its purposes; (c) obtain such short-term credits
total assets are outstanding. In addition, as are necessary for the clearance of
the Fund is permitted to participate in a portfolio transactions; (d) purchase
credit facility whereby the Fund may directly securities on margin to the extent permitted
lend to and borrow money from other AmSouth by applicable law; and (e) engage in
funds for temporary purposes, provided that transactions in mortgage dollar rolls that are
the loans are made in accordance with an order accounted for as financings.
of exemption from the SEC and any conditions
thereto.
------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Capital Growth Fund may not make Pioneer Oak Ridge Large Cap Growth Fund may
loans, except that the Fund may purchase or not make loans, except that the Fund may (i)
hold debt instruments in accordance with its lend portfolio securities in accordance with
investment objective and policies, lend Fund the Fund's investment policies, (ii) enter
securities in accordance with its investment into repurchase agreements, (iii) purchase all
objective and policies and enter into or a portion of an issue of publicly
repurchase agreements. In addition, the Fund distributed debt securities, bank loan
is permitted to participate in a credit participation interests, bank certificates of
facility whereby the Fund may directly lend to deposit, bankers' acceptances, debentures or
and borrow money from other AmSouth Funds for other securities, whether or not the purchase
temporary purposes, provided that the loans is made upon the original issuance of the
are made in accordance with an order of securities, (iv) participate in a credit
exemption from the SEC and any conditions facility whereby the Fund may directly lend to
thereto. and borrow money from other affiliated funds
to the extent permitted under the Investment
Company Act or an exemption therefrom, and (v)
make loans in any other manner consistent with
applicable law, as amended and interpreted or
modified from time to time by any regulatory
authority having jurisdiction.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Capital Growth Fund may invest in Pioneer Oak Ridge Large Cap Growth Fund may
futures contracts and options thereon use futures and options on securities, indices
(interest rate futures contracts or index and currencies, forward currency exchange
futures contracts, as applicable) to commit contracts and other derivatives. The Fund
funds awaiting investment, to maintain cash does not use derivatives as a primary
liquidity or for other hedging purposes. The investment technique and generally limits
value of the Fund's contracts may equal or their use to hedging. However, the Fund may
exceed 100% of the Fund's total assets, use derivatives for a variety of non-principal
although the Fund will not purchase or sell a purposes, including:
futures contract unless immediately afterwards
the aggregate amount of margin deposits on its o As a hedge against adverse changes in
existing futures positions plus the amount of stock market prices, interest rates
premiums paid for related futures options or currency exchange rates
entered into for other than bona fide hedging o As a substitute for purchasing or
purposes is 5% or less of its net assets. selling securities
o To increase the Fund's return as a
The Fund also may write covered put options in non-hedging strategy that may be
respect of specific securities in which the considered speculative
Fund may invest and write covered call and put
option contracts. The size of the premiums
that the Fund may receive may be adversely
affected as new or existing institutions,
including other investment companies, engage
in or increase their option-writing activities.
------------------------------------------------------------------------------------------------------------------------------
Short-term trading AmSouth Capital Growth Fund may engage in the Pioneer Oak Ridge Large Cap Growth Fund does
technique of short-term trading. Such trading not usually trade for short-term profits. The
involves the selling of securities held for a Fund will sell an investment, however, even if
short-time, ranging from several months to it has only been held for a short time, if it
less than a day. The object of such short-term no longer meets the Fund's investment criteria.
trading is to increase the potential for
capital appreciation and/or income of the Fund
in order to take advantage of what AAMI
believes are changes in market, industry or
individual company outlook.
------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different.
For a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 5% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
There is no CDSC, except in certain Class A
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge is
(non 12b-1) of up to 0.25% of average daily waived.
net assets.
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive a
continuously declines over six years, starting commission from PFD, the Fund's distributor,
with year one and ending in year seven from: at the time of your purchase of up to 4%.
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B
shares held continuously, the CDSC declines Class B shares are subject to distribution and
over six years, starting with year one and service (12b-1) fees of up to 1% of average
ending in year seven from: 5%, 4%, 3%, 3%, 2%, daily net assets.
1%. Eight years after purchase (seven years in
the case of shares acquired in the ISG Maximum purchase of Class B shares in a single
combination), Class B shares automatically transaction is $49,999.
convert to Class A shares.
Class B shares acquired through the
Class B shares pay a shareholder servicing fee Reorganization will be subject to the CDSC and
(non 12b-1) of up to 0.25% of average daily commission schedules applicable to the
net assets and a distribution (12b-1) fee of original purchase.
0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y sales AmSouth Capital Growth Fund does not impose The Fund does not impose any initial,
charges and Rule 12b-1 fees any initial or CDSC on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------
Management AmSouth Capital Growth Fund pays an advisory Pioneer Oak Ridge Large Cap Growth Fund pays
and other fees fee on a monthly basis at an annual rate of Pioneer an annual fee equal to 0.75% of the
0.80% of the Fund's average daily net assets. Fund's average daily net assets up to $1
billion and 0.70% on assets over $1 billion.
ASO Services Company, Inc. ("ASO") serves as
administrator and fund accounting agent for The fee is computed daily and paid monthly.
the Fund. The Fund pays ASO an administrative During its most recent fiscal year, the Fund
services fee of 0.15% of the Fund's average paid an advisory fee at an average rate of
daily net assets. 0.75% of average daily net assets.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Other expenses of the Fund are being limited In addition, the Fund reimburses Pioneer for
to 0.49% for Class A shares, 0.49% for Class B certain fund accounting and legal expenses
shares and 0.34% for Class I shares. Any fee incurred on behalf of the Fund and pays a
waiver or expense reimbursement arrangement is separate shareholder servicing/transfer agency
voluntary and may be discontinued at any time. fee to PIMSS, an affiliate of Pioneer.
For the fiscal year ended July 31, 2004, the Pioneer has contractually agreed to limit
Fund's annual operating expenses for Class A ordinary operating expenses to the extent
shares, after giving effect to the expense required to reduce fund expenses to 1.30% and
limitation were 1.29%, and without giving 2.10% of the average daily net assets
effect to the expense limitation, were 1.31% attributable to Class A and Class B shares,
of average daily net assets. respectively. These expense limitations are in
effect through April 1, 2008 for Class A
For the fiscal year ended July 31, 2004, the shares and through April 1, 2007 for Class B
Fund's annual operating expenses for Class B shares.
shares, after giving effect to the expense
limitation were 2.04%, and without giving For the fiscal year ended November 30, 2004,
effect to the expense limitation, were 2.06% the Fund's total annual operating expenses for
of average daily net assets. Class A shares, after giving effect to the
expense limitation, were 1.30%, and without
For the fiscal year ended July 31, 2004, the giving effect to the expense limitation were
Fund's annual operating expenses for Class I 2.42% of average daily net assets.
shares, after giving effect to the expense
limitation were 1.14%, and without giving For the fiscal year ended November 30, 2004,
effect to the expense limitation, were 1.21% the Fund's total annual operating expenses for
of average daily net assets. Class B shares, after giving effect to the
expense limitation, were 2.20%, and without
giving effect to the expense limitation were
2.94% of average daily net assets.
For the fiscal year ended November 30, 2004,
the Fund's total annual operating expenses for
Class Y shares were 1.19% of average daily net
assets.
------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Fund by
telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. The Fund allows you to exchange your
requirements for the Fund into which you are shares at net asset value without charging you
exchanging. Exchanges from one Fund to another either an initial or contingent deferred
are taxable. Class A shares may be exchanged shares charge at the time of the exchange.
for Class I shares of the same Fund or another Shares you acquire as part of an exchange will
AmSouth Fund if you become eligible to continue to be subject to any contingent
purchase Class I shares. Class I shares may deferred sales charge that applies to the
be exchanged for Class A shares of the same shares you originally purchased. When you
Fund. No transaction fees are currently ultimately sell your shares, the date of your
charged for exchanges. original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days purchase of shares for federal income tax
of the date of purchase, you will be charged a purposes.
2.00% fee on the current net asset value of
the shares sold or exchanged. The fee is paid After you establish an eligible fund account,
to the Fund to offset the costs associated you can exchange Fund shares by telephone or
with short-term trading, such as portfolio online.
transaction and administrative costs.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased shares
on different days, the shares purchased first
will be considered redeemed first for purposes
of determining whether the redemption fee will
be charged.
The fee will be charged on all covered
redemptions and exchanges, including those made
through retirement plan, brokerage and other
types of omnibus accounts (except where it is
not practical for the plan administrator or
brokerage firm to implement the fee). The Fund
will not impose the redemption fee on a
redemption or exchange of shares purchased upon
the reinvestment of dividend and capital gain
distributions.
------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the
Fund receives your request in good order.
-------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Pioneer Fund by telephone
or online.
------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o Large company or growth stocks fall out of favor with investors
o The adviser's/subadviser's judgment about the attractiveness, growth potential or potential appreciation of a particular stock proves to be incorrect
Pioneer Oak Ridge Large Cap Growth Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Fund invests in issuers in countries with emerging markets or if the Fund invests significantly in one country. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the adviser/subadviser might not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
In addition, at times, more than 25% of Pioneer Oak Ridge Large Cap Growth Fund's assets may be invested in the same market segment, such as financial or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
AmSouth Capital Growth Fund is subject to risks relating to the fact that it is non-diversified. The Fund may invest in a small number of companies which may increase the volatility of the Fund. Accordingly, the Fund's portfolio may be more sensitive to changes in the market value of a single company or industry.
Although Pioneer Oak Ridge Large Cap Growth Fund is classified as a diversified investment company, the Fund's portfolio may be comprised of fewer issuers than many large cap growth funds. Typically, the subadviser expects the portfolio to include a limited number of different issuers, which may increase the volatility of the Fund's net asset value per share.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Capital Growth Fund -- Class A Shares Calendar Year Total Returns*
[THE FOLLOWING DATA WAS REPRESENTED AS A BAR CHART IN THE PRINTED MATERIAL]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 30.42 22.25 30.79 32.05 21.85 -0.69 -21.75 -25.17 26.36 3.80 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 22.63% for the quarter ended December 31, 1998, and the lowest quarterly return was -21.26% for the quarter ended September 30, 2001.
Pioneer Oak Ridge Large Cap Growth Fund -- Class A Shares Calendar Year Total Returns*
[THE FOLLOWING DATA WAS REPRESENTED AS A BAR CHART IN THE PRINTED MATERIAL]
2000 2001 2002 2003 2004 6.64 -11.95 -17.4 19.53 11.4 |
* During the period shown in the bar chart since the Fund's inception March 1, 1999, Pioneer Oak Ridge Large Cap Growth Fund's highest quarterly return was 13.43% for the quarter ended December 31, 1999, and the lowest quarterly return was -13.05% for the quarter ended September 30, 2002.
AmSouth Capital Growth Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund, Class A Shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes(1) -1.94% -6.34% 9.24%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions -2.08% -6.80 7.69%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -1.27% -5.44 7.62%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund, Class B Shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes -2.01% -6.30% 8.87%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Capital Growth Fund, Class I Shares (3)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 3.92% -5.11% 9.90%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 3.77% -5.58% 8.34%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 2.54% -4.44% 8.22%
---------------------------------------------------------------------------------------------------------------------------------
S&P 500/Barra Growth Index(4) 6.13% -7.07% 11.44%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) The quoted returns reflect the performance from 4/1/96 to 3/12/00 of the ISG Capital Growth Fund, an open-end investment company that was the predecessor fund to the AmSouth Capital Growth Fund. The ISG Capital Growth Fund commenced operations on 4/1/96 through a transfer of assets from certain collective trust fund ("commingled") accounts managed by First American National Bank, using substantially the same investment objective, policies and methodologies as the Fund. The quoted before-tax returns of the Fund includes the performance of the predecessor fund and commingled accounts for periods dating back to 7/31/93, and prior to the Fund's commencement of operations, restated to reflect the expenses associated with the Fund. The commingled accounts were not registered with the SEC and, therefore, were not subject to the investment restrictions imposed by law on registered mutual funds. If the commingled accounts had been registered, the commingled accounts' performance may have been adversely affected. After-tax returns reflect performance since 4/1/96, and do not include the performance of the commingled accounts prior to that date. Class A shares were first offered on 4/1/96.
(2) Performance for the Class B shares, which were first offered on 2/5/98, is based on the historical performance of the Fund's Class A shares, including the performance of the predecessor fund and commingled accounts (without sales charge), prior to that date. The predecessor fund and commingled accounts were managed using substantially the same investment objective, policies and methodologies as the Fund. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the contingent deferred sales charge.
(3) Performance for the Class I shares, which were first offered on 10/3/97, is based on the historical performance of the Fund's Class A shares, including the performance of the predecessor fund and commingled accounts (without sales charge), prior to that date. The predecessor fund and commingled accounts were managed using substantially the same investment objective, policies and methodologies as the Fund.
(4) The S&P 500/Barra Growth Index, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Capital Growth Fund's returns. After-tax returns are only shown for Class A shares and Class I shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
The Pioneer Fund's past performance does not necessarily indicate how it will perform in the future. Pursuant to an agreement and plan of reorganization, the Pioneer Fund acquired all of the assets and those liabilities reflected in the net assets of Oak Ridge Large Cap Equity Fund (the predecessor fund) on February 13, 2004. In the reorganization, the predecessor fund exchanged all of its assets for Class A shares of the Pioneer Fund. The predecessor fund offered only one class of shares which
was most similar to Class A shares of the Pioneer Fund. As a result of the reorganization, the Pioneer Fund is the accounting successor of the predecessor fund, which commenced operations on March 1, 1999. The Pioneer Fund's subadviser served as the predecessor fund's investment adviser. The performance of each class of the Pioneer Fund includes the performance of the predecessor fund's shares prior to the reorganization, which has been restated to reflect differences in any applicable sales charges and Rule 12b-1 fees (but not other differences in expenses). This adjustment had the effect of reducing the previously reported performance of the predecessor fund.
Pioneer Oak Ridge Large Cap Growth Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
(March 1, 1999)
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund, Class A shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 4.96% -0.54% 1.26%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 4.88% -0.79% 1.04%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares(1) 3.29% -0.55% 0.99%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund, Class B shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 6.59% -0.10% 1.53%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund, Class Y shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 11.56% 0.67% 2.31%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 11.51% 0.43% 2.10%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares(1) 7.58% 0.48% 1.90%
---------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index(3) 10.87% -2.30% 1.13%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
Russell 1000 Growth Index(4) 6.30% -9.29% -3.56%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown, and the after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
(2) Reflects the inception date of predecessor fund. The inception date of Class B shares was February 17, 2004 and of Class Y shares was August 11, 2004.
(3) The S&P 500 Index, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
(4) The Russell 1000 Growth Index, and unmanaged index made up of those stocks contained within the Russell 1000 Index having higher price-to-book ratios, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Capital Growth Fund, the expenses of AmSouth Capital Growth Fund for the period ended January 31, 2005 and (ii) for Pioneer Oak Ridge Large Cap Growth Fund, the expenses of Pioneer Oak Ridge Large Cap Growth Fund for the period ended May 31, 2005. Future expenses for all share classes may be greater or less. Shareholders of AmSouth Large Cap Fund are also being asked to approve the reorganization of their fund into Pioneer Oak Ridge Large Cap Growth Fund. The tables also show (1) the pro forma expenses of the combined Fund assuming the Reorganization occurred on May 31, 2005, and (2) the pro forma expenses of the combined Fund assuming the reorganization of AmSouth Large Cap Fund into Pioneer Oak Ridge Large Cap Growth Fund also occurred on May 31, 2005.
------------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined Combined AmSouth Pioneer Combined Combined AmSouth Pioneer
transaction fees Capital Oak Fund (Pro Fund Capital Oak Ridge Fund Fund Capital Oak
(paid directly Growth Ridge Forma) (including Growth Fund (Pro (including Growth Ridge
from your Fund(1) Fund AmSouth Fund(1) Forma) AmSouth Fund(1) Fund
investment) Large Cap Large Cap
Fund) (Pro Fund) (Pro
Forma) Forma)
Class A Class A Class A Class A Class B Class B Class B Class B Class I Class Y
------------------------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75%(2) 5.75%(2) 5.75%(2) None None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
------------------------------------------------------------------------------------------------------------------------------------
Maximum deferred None None None None 5.00%(3) 4.00% 4.00% 4.00% None None
sales charge
(load) as a
percentage of
purchase price
or the amount
you receive when
you sell shares,
whichever is less
------------------------------------------------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) None None None 2.00%(4) None None None 2.00%(4) None
------------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets) (as
a % of average
net assets)
------------------------------------------------------------------------------------------------------------------------------------
Management fee 0.80% 0.75% 0.75% 0.75% 0.80% 0.75% 0.75% 0.75% 0.80% 0.75%
------------------------------------------------------------------------------------------------------------------------------------
Distribution and None 0.25% 0.25% 0.25% 0.75% 1.00% 1.00% 1.00% None None
service (12b-1)
fee
------------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------
Shareholder Combined Combined
transaction fees Fund (Pro Fund
(paid directly Forma) (including
from your AmSouth
investment) Large Cap
Fund) (Pro
Forma)
Class Y Class Y
---------------------------------------------
Maximum sales None None
charge (load)
when you buy
shares as a
percentage of
offering price
---------------------------------------------
Maximum deferred None None
sales charge
(load) as a
percentage of
purchase price
or the amount
you receive when
you sell shares,
whichever is less
---------------------------------------------
Redemption fees None None
---------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets) (as
a % of average
net assets)
---------------------------------------------
Management fee 0.75% 0.75%
---------------------------------------------
Distribution and None None
service (12b-1)
fee
---------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined Combined AmSouth Pioneer Combined Combined AmSouth Pioneer
transaction fees Capital Oak Fund (Pro Fund Capital Oak Ridge Fund Fund Capital Oak
(paid directly Growth Ridge Forma) (including Growth Fund (Pro (including Growth Ridge
from your Fund(1) Fund AmSouth Fund(1) Forma) AmSouth Fund(1) Fund
investment) Large Cap Large Cap
Fund) (Pro Fund) (Pro
Forma) Forma)
Class A Class A Class A Class A Class B Class B Class B Class B Class I Class Y
------------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.57%(5) 1.42% 0.25% 0.19% 0.67%(5) 1.19% 0.53% 0.45% 0.45%(5) 0.44%
------------------------------------------------------------------------------------------------------------------------------------
Total fund 1.37% 2.42%(6) 1.25% 1.19% 2.22% 2.94%(6) 2.28% 2.20% 1.25% 1.19%(6)
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
Expense 0.08% 1.12%(7) NA N/A 0.18% 0.74%(7) 0.18%(8) 0.10%(8) 0.11% N/A
reimbursement/
reduction
------------------------------------------------------------------------------------------------------------------------------------
Net fund 1.29% 1.30% 1.25% 1.19% 2.04% 2.20% 2.10% 2.10% 1.14% 1.19%
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------
Shareholder Combined Combined
transaction fees Fund (Pro Fund
(paid directly Forma) (including
from your AmSouth
investment) Large Cap
Fund) (Pro
Forma)
Class Y Class Y
---------------------------------------------
Other expenses 0.15% 0.11%
---------------------------------------------
Total fund 0.90% 0.86%
operating
expenses
---------------------------------------------
Expense N/A N/A
reimbursement/
reduction
---------------------------------------------
Net fund 0.90% 0.86%
operating
expenses
---------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.49% for Class A shares, 0.49% for Class B shares and 0.34% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(7) The expenses in the table above reflect the expense limitations currently in effect for the Pioneer Fund, under which Pioneer has contractually agreed to limit ordinary operating expenses to the extent required to reduce fund expenses to 1.30%, and 2.20% of the average daily net assets attributable to Class A and Class B shares, respectively. These expense limitations are in effect through April 1, 2008 for Class A shares and through April 1, 2006 for Class B shares. There can be no assurance that Pioneer will extend the expense limitations beyond such time.
(8) The expenses in the table above reflect the expense limitation in effect for Class B shares of the Pioneer Fund, under which Pioneer has contractually agreed to limit ordinary operating expenses to the extent required to reduce fund expenses 2.10% of the average daily net assets attributable Class B shares. This expense limitation is in effect through April 1, 2007. There can be no assurance that Pioneer will extend the expense limitations beyond such time.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------------------------
Combined Fund
(including AmSouth
Number of years you AmSouth Capital Pioneer Oak Ridge Large Combined Fund Large Cap Fund)
own your shares Growth Fund Cap Growth Fund (Pro Forma) (Pro Forma)
------------------------------------------------------------------------------------------------------------
Class A
------------------------------------------------------------------------------------------------------------
Year 1 $682 $700 $695 $689
------------------------------------------------------------------------------------------------------------
Year 3 $960 $963 $949 $931
------------------------------------------------------------------------------------------------------------
Year 5 $1,259 $1,485 $1,222 $1,192
------------------------------------------------------------------------------------------------------------
Year 10 $2,106 $2,913 $1,999 $1,935
------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
------------------------------------------------------------------------------------------------------------
Year 1 $725 $623 $613 $613
------------------------------------------------------------------------------------------------------------
Year 3 $994 $1,140 $995 $979
------------------------------------------------------------------------------------------------------------
Year 5 $1,390 $1,583 $1,304 $1,271
------------------------------------------------------------------------------------------------------------
Year 10 $2,340 $3,086 $2,342 $2,270
------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
------------------------------------------------------------------------------------------------------------
Year 1 $225 $223 $213 $213
------------------------------------------------------------------------------------------------------------
Year 3 $694 $840 $695 $679
------------------------------------------------------------------------------------------------------------
Year 5 $1,190 $1,483 $1,204 $1,171
------------------------------------------------------------------------------------------------------------
Year 10 $2,340 $3,086 $2,342 $2,270
------------------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------------------
Year 1 $127 $121 $92 $88
------------------------------------------------------------------------------------------------------------
Year 3 $397 $378 $287 $274
------------------------------------------------------------------------------------------------------------
Year 5 $686 $654 $498 $477
------------------------------------------------------------------------------------------------------------
Year 10 $1,511 $1,443 $1,108 $1,061
------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Capital Growth Fund and its shareholders. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the historical investment performance of Pioneer Oak Ridge Large Cap Growth Fund is significantly better than your AmSouth Fund's investment performance. For the one and five year periods ended December 31, 2004, Class A shares of Pioneer Oak Ridge Large Cap Growth Fund had an average annual return of 4.96% (one year); and -0.54% (five year), compared to an average annual return of the Class A shares of your AmSouth Fund of -1.94% (one year); and -6.34% (five year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Third, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $26.7 billion in equity securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges
Fourth, Pioneer Oak Ridge Large Cap Growth Fund's management fee (0.75% of average daily net assets) is lower than the advisory fee of your AmSouth Fund (0.80% of average daily net assets). The historical gross and net expenses of Pioneer Oak Ridge Large Cap Growth Fund attributable to Class A are slightly higher than your AmSouth Fund's historical gross and net expenses. However, the estimated pro forma expenses of the Pioneer Fund attributable to Class A and Y shares after giving effect to the Reorganizations on both a gross and net basis are lower than your AmSouth Fund's gross and net operating expenses for the Class A and I shares. The estimated pro forma expenses for Class B shares will be lower on a gross basis, but higher on a net basis. The Board considered the positive factors associated with the Reorganization, such as the superior performance of the Pioneer Fund, to outweigh the negative factors, such as the increase in net operating expenses for the Class B shares. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Fifth, the substantially larger size of the combined Pioneer Oak Ridge Large Cap Growth Fund will offer greater opportunity for diversification of the investment portfolio, which should help to reduce risks.
Sixth, the Class A, B and Y shares of Pioneer Oak Ridge Large Cap Growth Fund received in the Reorganization will provide AmSouth Capital Growth Fund shareholders with exposure to substantially the same investment product as they currently have.
Seventh, The transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares. Although the Reorganization will result in a per share increase in net unrealized capital gains and decrease in capital loss carryforwards, the potential negative tax consequences of these aspects of the Reorganization are outweighed by the advantages of the Reorganization.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the AmSouth Funds' proxy statements and solicitation costs incurred by the AmSouth Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Funds in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Large Cap Fund approve the reorganization of their fund into Pioneer Oak Ridge Large Cap Growth Fund.
------------------------------------------------------------------------------------------------------------------------------
Pro Forma Pioneer
Oak Ridge Large
Cap Growth Fund
Pioneer Oak Ridge Pro Forma Pioneer Oak (including
AmSouth Capital Large Cap Growth Ridge Large Cap AmSouth Large Cap
Growth Fund Fund Growth Fund Fund)
May 31, 2005 May 31, 2005 May 31, 2005 May 31, 2005
------------------------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $248,563 $220,176 $468,739 $799,086
------------------------------------------------------------------------------------------------------------------------------
Class A shares ................. $27,454 $87,287 $114,740 $228,425
------------------------------------------------------------------------------------------------------------------------------
Class B shares ................. $6,781 $10,999 $17,780 $40,130
------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ............... $214,328 $79,164 $293,493 $487,805
------------------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
------------------------------------------------------------------------------------------------------------------------------
Class A shares ................. $9.99 $12.66 $12.66 $12.66
------------------------------------------------------------------------------------------------------------------------------
Class B shares ................. $9.30 $12.54 $12.54 $12.54
------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ............... $10.01 $12.70 $12.70 $12.70
------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding
------------------------------------------------------------------------------------------------------------------------------
Class A shares ................. $2,747,560 $6,895,166 $9,063,867 $18,044,318
------------------------------------------------------------------------------------------------------------------------------
Class B shares ................. $729,523 $877,131 $1,417,918 $3,200,220
------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ............... $21,403,248 $6,234,510 $23,113,721 $38,416,647
------------------------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Large Cap Fund and Pioneer Oak Ridge Large Cap Growth Fund
PROPOSAL 1(b)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests primarily in equity securities of large capitalization issuers and, consequently the Funds have similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Large Cap Fund to Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified series of Pioneer Series Trust
open-end management investment company I, and open-end management investment company
organized as a Massachusetts business trust. organized as a Delaware statutory trust.
------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, $337.4 million $157.9 million
2005
------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Investment Subadviser:
Day-to-day management of AmSouth Large Cap Oak Ridge Investments, LLC ("Oak Ridge")
Fund's portfolio is the responsibility of
Ronald E. Lindquist, who has been the Fund's Portfolio Managers:
primary portfolio manager since its inception, Day-to-day management of the Fund's portfolio
and has been employed by AAMI since December is the responsibility of David M. Klaskin
1999. Prior to December 1999, Mr. Lindquist (lead manager), Chairman (since 1998),
was employed by First American National Bank Treasurer and Chief Investment Officer (since
(since May 1998), and by Deposit Guaranty 1989) of Oak Ridge, and Robert G. McVicker,
National Bank, and Commercial National Bank Portfolio Manager and Director of Research at
(since 1978). First American National Bank, Oak Ridge (since 1989).
Deposit Guaranty National Bank and Commercial
National Bank are predecessors of AmSouth Bank
and affiliates of AAMI.
Mr. Lindquist is Senior Vice President of
AmSouth Bank and AmSouth Asset Management, Inc.
------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Large Cap Fund seeks to provide Pioneer Oak Ridge Large Cap Growth Fund seeks
investors with long-term capital appreciation. capital appreciation.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Primary investments Under normal circumstances, AmSouth Large Cap Normally, Pioneer Oak Ridge Large Cap Growth
Fund invests at least 80% of its net assets in Fund invests at least 80% of its net assets
equity securities of U.S. companies with large (plus the amount of borrowings, if any, for
market capitalizations. For the purpose of investment purposes) in equity securities of
this policy, net assets include net assets large capitalization U.S. companies. Large
plus borrowings for investment purposes. Large capitalization companies have market
capitalization companies are generally those capitalizations at the time of acquisition of
companies with market capitalization over $1 $3 billion or more. The Fund anticipates that
billion. the average weighted market capitalization of
the companies in the Fund's portfolio will be
significantly higher than $3 billion.
The equity securities in which Pioneer Oak
Ridge Large Cap Growth Fund principally
invests are common stocks, preferred stocks,
depositary receipts and convertible debt, but
the Fund may invest in other types of equity
securities to a lesser extent, such as
warrants and rights.
------------------------------------------------------------------------------------------------------------------------------
Investment strategies In choosing stocks for the Fund, AAMI's Pioneer Oak Ridge Large Cap Growth Fund uses a
strategy is to select what are in its opinion, "growth" style of management and seeks to
well-managed U.S. companies that have invest in issuers with above average potential
demonstrated sustained patterns of for earnings growth. Pioneer has engaged Oak
profitability, strong balance sheets, and the Ridge to act as the Fund's subadviser under
potential to achieve predictable, Pioneer's supervision. When making purchase
above-average earnings growth. AAMI seeks to decisions for the Fund, the subadviser uses a
diversify the Fund's portfolio within various disciplined approach that involves three
industries typically comprising those AAMI primary components:
believes to be the classic growth sectors of o Research: The subadviser analyzes
the U.S. economy: Technology, Consumer research on potential investments from a wide
Non-Durables, Health Care, Business Equipment variety of sources, including internally
and Services, Retail, Capital Goods and generated analysis and research provided by
Financials. institutions and the brokerage community. The
subadviser seeks to supplement this analysis
The Fund invests for long-term growth rather with information derived from business and
than short-term profits. trade publications, filings with the SEC,
corporate contacts, industry conferences and
discussions with company management.
o Fundamentals: Once a potential
investment is identified, the subadviser
considers whether the issuer possesses certain
attributes that the subadviser believes a
"buy" candidate should possess relating to,
among other things, (i) growth of sales and
earnings, (ii) earnings power, trends and
predictability, (iii) quality of management,
(iv) competitive position of products and/or
services, (v) fundamentals of the industry in
which the company operates and (vi) the
ability to benefit from economic and political
trends affecting the company.
o Valuation: Finally, the subadviser
values companies by considering price-to-sales
ratios and price-to-earnings ratios within a
peer group.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Other investments AmSouth Large Cap Fund may invest in debt The Fund may invest up to 20% of its total
securities of domestic issuers rated no lower assets in equity and debt securities of
than investment grade (Baa/BBB) by a credit non-U.S. corporate issuers and debt securities
rating agency, or, if unrated, deemed to be of of non-U.S. government issuers.
comparable quality by AAMI.
The Fund will not invest more than 5% of its
total assets in the securities of emerging
markets issuers.
------------------------------------------------------------------------------------------------------------------------------
Temporary defensive When AAMI determines adverse market conditions Pioneer Oak Ridge Large Cap Growth Fund may
strategies exist, AmSouth Large Cap Fund may invest invest all or part of its assets in securities
entirely in cash positions, directly in U.S. with remaining maturities of less than one
Government securities and short-term paper, year, cash equivalents or may hold cash.
such as bankers' acceptances.
------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is diversified for the purpose of the Investment Company Act and is subject to
diversification requirements under the Internal Revenue Code of 1986, as amended (the "Code").
------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Large Cap Fund may not purchase any Pioneer Oak Ridge Large Cap Growth Fund may
securities which would cause more than 25% of not invest more than 25% of its assets in any
the value of the Fund's total assets at the one industry.
time of purchase to be invested in securities
of one or more issuers conducting their
principal business activities in the same
industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the U.S.
government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their
activities are primarily related to financing
the activities of their parents; and (c)
utilities will be divided according to their
services. For example, gas, gas transmission,
electric and gas, electric, and telephone will
each be considered a separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental user.
------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Large Cap Fund may not invest more Pioneer Oak Ridge Large Cap Growth Fund may
securities than 15% of its net assets in securities that not invest more than 15% of its net assets in
are restricted as to resale, or for which no securities that are illiquid and other
readily available market exists, including securities that are not readily marketable.
repurchase agreements providing for settlement Repurchase agreements maturing in more than
more than seven days after notice. seven days will be included for purposes of
the foregoing limit.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Large Cap Fund may not borrow money or Pioneer Oak Ridge Large Cap Growth Fund may
issue senior securities, except the Fund may not borrow money, except the Fund may: (a)
borrow from banks or enter into reverse borrow from banks or through reverse
repurchase agreements for temporary emergency repurchase agreements in an amount up to 33
purposes in amounts up to 33 1/3% of the value 1/3% of the Fund's total assets (including the
of its total assets at the time of such amount borrowed); (b) to the extent permitted
borrowing. The Fund will not purchase by applicable law, borrow up to an additional
securities while borrowings (including reverse 5% of the Fund's assets for temporary
repurchase agreements) in excess of 5% of its purposes; (c) obtain such short-term credits
total assets are outstanding. In addition, as are necessary for the clearance of
the Fund is permitted to participate in a portfolio transactions; (d) purchase
credit facility whereby the Fund may directly securities on margin to the extent permitted
lend to and borrow money from other AmSouth by applicable law; and (e) engage in
funds for temporary purposes, provided that transactions in mortgage dollar rolls that are
the loans are made in accordance with an order accounted for as financings.
of exemption from the SEC and any conditions
thereto.
------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Large Cap Fund may not make loans, Pioneer Oak Ridge Large Cap Growth Fund may
except that the Fund may purchase or hold debt not make loans, except that the Fund may (i)
instruments in accordance with its investment lend portfolio securities in accordance with
objective and policies, lend Fund securities the Fund's investment policies, (ii) enter
in accordance with its investment objective into repurchase agreements, (iii) purchase all
and policies and enter into repurchase or a portion of an issue of publicly
agreements. In addition, the Fund is permitted distributed debt securities, bank loan
to participate in a credit facility whereby participation interests, bank certificates of
the Fund may directly lend to and borrow money deposit, bankers' acceptances, debentures or
from other AmSouth Funds for temporary other securities, whether or not the purchase
purposes, provided that the loans are made in is made upon the original issuance of the
accordance with an order of exemption from the securities, (iv) participate in a credit
SEC and any conditions thereto. facility whereby the Fund may directly lend to
and borrow money from other affiliated funds
to the extent permitted under the Investment
Company Act or an exemption therefrom, and (v)
make loans in any other manner consistent with
applicable law, as amended and interpreted or
modified from time to time by any regulatory
authority having jurisdiction.
------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Large Cap Fund may invest in futures Pioneer Oak Ridge Large Cap Growth Fund may
contracts and options thereon (interest rate use futures and options on securities, indices
futures contracts or index futures contracts, and currencies, forward currency exchange
as applicable) to commit funds awaiting contracts and other derivatives. The Fund
investment, to maintain cash liquidity or for does not use derivatives as a primary
other hedging purposes. The value of the investment technique and generally limits
Fund's contracts may equal or exceed 100% of their use to hedging. However, the Fund may
the Fund's total assets, although the Fund use derivatives for a variety of non-principal
will not purchase or sell a futures contract purposes, including:
unless immediately afterwards the aggregate
amount of margin deposits on its existing o As a hedge against adverse changes in
futures positions plus the amount of premiums stock market prices, interest rates or
paid for related futures options entered into currency exchange rates
for other than bona fide hedging purposes is o As a substitute for purchasing or
5% or less of its net assets. selling securities
o To increase the Fund's return as a
The AmSouth Fund also may write covered put non-hedging strategy that may be
options in respect of specific securities in considered speculative
which the Fund may invest and write covered
call and put option contracts. The size of
the premiums that the Fund may receive may be
adversely affected as new or existing
institutions, including other investment
companies, engage in or increase their
option-writing activities.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Short-term trading AmSouth Large Cap Fund may engage in the Pioneer Oak Ridge Large Cap Growth Fund does
technique of short-term trading. Such trading not usually trade for short-term profits. The
involves the selling of securities held for a Fund will sell an investment, however, even if
short-time, ranging from several months to it has only been held for a short time, if it
less than a day. The object of such short-term no longer meets the Fund's investment criteria.
trading is to increase the potential for
capital appreciation and/or income of the Fund
in order to take advantage of what AAMI
believes are changes in market, industry or
individual company outlook.
------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different.
For a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 5% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge is
(non 12b-1) of up to 0.25% of average daily waived.
net assets.
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive a
continuously declines over six years, starting commission from PFD, the Fund's distributor,
with year one and ending in year seven from: at the time of your purchase of up to 4%.
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B
shares held continuously, the CDSC declines Class B shares are subject to distribution and
over six years, starting with year one and service (12b-1) fees of up to 1% of average
ending in year seven from: 5%, 4%, 3%, 3%, 2%, daily net assets.
1%. Eight years after purchase (seven years in
the case of shares acquired in the ISG Maximum purchase of Class B in a single
combination), Class B shares automatically transaction is $49,999.
convert to Class A shares.
Class B shares acquired through the
Class B shares pay a shareholder servicing fee Reorganization will be subject to the CDSC and
(non 12b-1) of up to 0.25% of average daily commission schedules applicable to the
net assets and a distribution (12b-1) fee of original purchase.
0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y sales AmSouth Large Cap Fund does not impose any The Fund does not impose any initial,
charges and Rule 12b-1 fees initial or CDSC on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth Large Cap Fund pays an advisory fee on Pioneer Oak Ridge Large Cap Growth Fund pays
a monthly basis at an annual rate of 0.80% of Pioneer an annual fee equal to 0.75% of the
the Fund's average daily net assets. Fund's average daily net assets up to $1
billion and 0.70% on assets over $1 billion.
ASO Services Company, Inc. ("ASO") serves as The fee is computed daily and paid monthly.
administrator and fund accounting agent for
the Fund. The Fund pays ASO an administrative During its most recent fiscal year, the Fund
services fee of 0.15% of the Fund's average paid an advisory fee at an average rate of
daily net assets. 0.75% of average daily net assets.
Other expenses of the Fund are being limited In addition, the Fund reimburses Pioneer for
to 0.45% for Class A shares, 0.45% for Class B certain fund accounting and legal expenses
shares and 0.30% for Class I shares. Any fee incurred on behalf of the Fund and pays a
waiver or expense reimbursement arrangement is separate shareholder servicing/transfer agency
voluntary and may be discontinued at any time. fee to PIMSS, an affiliate of Pioneer.
For the fiscal year ended July 31, 2004, the Pioneer has contractually agreed to limit
Fund's annual operating expenses for Class A ordinary operating expenses to the extent
shares, after giving effect to the expense required to reduce fund expenses to 1.30% and
limitation were 1.25%, and without giving 2.10% of the average daily net assets
effect to the expense limitation, were 1.32% attributable to Class A and Class B shares,
of average daily net assets. respectively. These expense limitations are in
effect through April 1, 2008 for Class A
For the fiscal year ended July 31, 2004, the shares and through April 1, 2007 for Class B
Fund's annual operating expenses for Class B shares.
shares, after giving effect to the expense
limitation were 2.00%, and without giving For the fiscal year ended November 30, 2004,
effect to the expense limitation, were 2.07% the Fund's total annual operating expenses for
of average daily net assets. Class A shares, after giving effect to the
expense limitation, were 1.30%, and without
For the fiscal year ended July 31, 2004, the giving effect to the expense limitation were
Fund's annual operating expenses for Class I 2.42% of average daily net assets.
shares, after giving effect to the expense
limitation were 1.10%, and without giving For the fiscal year ended November 30, 2004,
effect to the expense limitation, were 1.22% the Fund's total annual operating expenses for
of average daily net assets. Class B shares, after giving effect to the
expense limitation, were 2.20%, and without
giving effect to the expense limitation were
2.94% of average daily net assets.
For the fiscal year ended November 30, 2004,
the Fund's total annual operating expenses for
Class Y shares were 1.19% of average daily net
assets.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Pioneer Fund
by telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. The Fund allows you to exchange your
requirements for the Fund into which you are shares at net asset value without charging you
exchanging. Exchanges from one Fund to another either an initial or contingent deferred
are taxable. Class A shares may be exchanged shares charge at the time of the exchange.
for Class I shares of the same Fund or another Shares you acquire as part of an exchange will
AmSouth Fund if you become eligible to continue to be subject to any contingent
purchase Class I shares. Class I shares may deferred sales charge that applies to the
be exchanged for Class A shares of the same shares you originally purchased. When you
Fund. No transaction fees are currently ultimately sell your shares, the date of your
charged for exchanges. original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 purchase of shares for federal income tax
days of the date of purchase, you will be purposes.
charged a 2.00% fee on the current net asset
value of the shares sold or exchanged. The After you establish an eligible fund account,
fee is paid to the Fund to offset the costs you can exchange Fund shares by telephone or
associated with short-term trading, such as online.
portfolio transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares purchased
first will be considered redeemed first for
purposes of determining whether the redemption
fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator
or brokerage firm to implement the fee). The
Fund will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund Pioneer Oak Ridge Large Cap Growth Fund
------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
------------------------------------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Pioneer Fund by telephone
or online.
------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o Large company or growth stocks fall out of favor with investors
o The adviser's/subadviser's judgment about the attractiveness, growth potential or potential appreciation of a particular stock proves to be incorrect
Pioneer Oak Ridge Large Cap Growth Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Fund invests in issuers in countries with emerging markets or if the Fund invests significantly in one country. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the adviser/subadviser might not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
In addition, at times, more than 25% of Pioneer Oak Ridge Large Cap Growth Fund's assets may be invested in the same market segment, such as financials or technology. To the extent the Fund emphasizes investments in a market segment, the fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
Although the Pioneer Oak Ridge Large Cap Growth Fund is classified as a diversified investment company, the Fund's portfolio may be comprised of fewer issuers than many large cap growth funds. Typically, the subadviser expects the portfolio to include a limited number of different issuers, which may increase the volatility of the Fund's net asset value per share.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Large Cap Fund -- Class A Shares Calendar Year Total Returns*
[THE FOLLOWING DATA WAS REPRESENTED AS A BAR CHART IN THE PRINTED MATERIAL]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 34.99 17.63 35.93 37.87 18.85 -2.22 -11.29 -23.27 25.59 5.25 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 24.83% for the quarter ended December 31, 1998, and the lowest quarterly return was -17.87% for the quarter ended September 30, 2002.
The Pioneer Fund's past performance does not necessarily indicate how it will perform in the future. Pursuant to an agreement and plan of reorganization, the Pioneer Fund acquired all of the assets and those liabilities reflected in the net assets of Oak Ridge Large Cap Equity Fund (the predecessor fund) on February 13, 2004. In the reorganization, the predecessor fund exchanged all of its assets for Class A shares of the Fund. The predecessor fund offered only one class of shares which was most similar to Class A shares of the Pioneer Fund. As a result of that reorganization, the Pioneer Fund is the accounting successor of the predecessor fund, which commenced operations on March 1, 1999. The Pioneer Fund's subadviser served as the predecessor fund's investment adviser. The performance of each class of the Pioneer Fund includes the performance of the predecessor fund's shares prior to the 2004 reorganization, which has been restated to reflect differences in any applicable sales charges and Rule 12b-1 fees (but not other differences in expenses). This adjustment had the effect of reducing the previously reported performance of the predecessor fund.
Pioneer Oak Ridge Large Cap Growth Fund -- Class A Shares Calendar Year Total Returns*
[THE FOLLOWING DATA WAS REPRESENTED AS A BAR CHART IN THE PRINTED MATERIAL]
2000 2001 2002 2003 2004 6.64 -11.95 -17.4 19.53 11.4 |
* During the period shown in the bar chart since the Fund's inception March 1, 1999, Pioneer Oak Ridge Large Cap Growth Fund's highest quarterly return was 13.43% for the quarter ended December 31, 1999, and the lowest quarterly return was -13.05% for the quarter ended September 30, 2002.
AmSouth Large Cap Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund, Class A Shares(1)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes -0.53% -3.62% 11.39%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions -1.54% -4.79% 9.95%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -0.35% -3.36% 9.68%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund, Class B Shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes -0.56% -3.56% 11.05%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Large Cap Fund, Class I Shares(3)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 5.35% -2.39% 12.10%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 4.29% -3.58% 10.64%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 3.47% -2.35% 10.32%
---------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index(4) 10.87% -2.30% 12.07%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) The quoted returns reflect the performance from 8/3/92 to 12/13/98 of the DG Equity Fund and from 12/14/98 to 3/12/00 of the ISG Large Cap Equity Fund, which were open-end investment companies that were predecessor funds to the Large Cap Fund. The predecessor funds were managed using substantially the same investment objective, policies and methodologies as the Fund. Class A shares were first offered on 8/3/92.
(2) Performance for the Class B shares, which were first offered on 12/15/98, is based on the historical performance of the Fund's Class A shares, including the performance of the predecessor funds (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B distribution (12b-1) fees and the contingent deferred sales charge.
(3) The quoted returns reflect the performance from 8/3/92 to 12/13/98 of the DG Equity Fund and from 12/14/98 to 3/12/00 of the ISG Large Cap Equity Fund, which were open-end investment companies that were predecessor funds to the Large Cap Fund. The predecessor funds were managed using substantially the same investment objective, policies and methodologies as the Fund. Performance for the Class I shares, which were first offered on 12/14/98, is based on the historical performance of the Fund's Class A shares, including the performance of the predecessor funds (without sales charge) prior to that date.
(3) The S&P 500 Index, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Large Cap Fund's returns. After-tax returns are only shown for Class A shares and Class I shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Oak Ridge Large Cap Growth Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
(March 1, 1999)
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund, Class A shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 4.96% -0.54% 1.26%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 4.88% -0.79% 1.04%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares(1) 3.29% -0.55% 0.99%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund, Class B shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 6.59% -0.10% 1.53%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund, Class Y shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 11.56% 0.67% 2.31%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 11.51% 0.43% 2.10%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares(1) 7.58% 0.48% 1.90%
---------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index(3) 10.87% -2.30% 1.13%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
Russell 1000 Growth Index(4) 6.30% -9.29% -3.56%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown. Furthermore, the after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
(2) Reflects the inception date of predecessor fund. The inception date of Class B shares was February 17, 2004 and of Class Y shares was August 11, 2004.
(3) The S&P 500 Index, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
(4) The Russell 1000 Growth Index, and unmanaged index made up of those stocks contained within the Russell 1000 Index having higher price-to-book ratios, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Large Cap Fund, the expenses of AmSouth Large Cap Fund for the period ended January 31, 2005 and (ii) for Pioneer Oak Ridge Large Cap Fund, the expenses of Pioneer Oak Ridge Large Cap Growth Fund for the period ended May 31, 2005. Future expenses for all share classes may be greater or less. Shareholders of AmSouth Capital Growth Fund are also being asked to approve the reorganization of their fund into Pioneer Oak Ridge Large Cap Growth Fund. The tables also show (1) the pro forma expenses of the combined Fund assuming the Reorganization occurred on May 31, 2005, and (2) the pro forma expenses of the combined Fund assuming the reorganization of AmSouth Capital Growth Fund into Pioneer Oak Ridge Large Cap Growth Fund also occurred May 31, 2005.
------------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined Combined AmSouth Pioneer Combined Combined AmSouth Pioneer
transaction Large Cap Oak Ridge Fund (Pro Fund Large Cap Oak Ridge Fund (Pro Fund Large Oak Ridge
fees (paid Fund(1) Fund Forma) (including Fund(1) Fund Forma) (including Cap Fund
directly AmSouth AmSouth Fund(1)
from your Capital Capital
investment) Growth Growth
Fund) (Pro Fund) (Pro
Forma) Forma)
Class A Class A Class A Class A Class B Class B Class B Class B Class I Class Y
------------------------------------------------------------------------------------------------------------------------------------
Maximum 5.50%(2) 5.75%(2) 5.75%(2) 5.75%(2) None None None None None None
sales charge
(load) when
you buy
shares as a
percentage
of offering
price
------------------------------------------------------------------------------------------------------------------------------------
Maximum None None None None 5.00%(3) 4.00% 4.00% 4.00% None None
deferred
sales charge
(load) as
a percentage
of purchase
price or the
amount you
receive when
you sell
shares,
whichever is
less
------------------------------------------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None None 2.00%(4) None None None 2.00%(4) None
fees
------------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as
a % of
average net
assets)
------------------------------------------------------------------------------------------------------------------------------------
Management 0.80% 0.75% 0.75% 0.75% 0.80% 0.75% 0.75% 0.75% 0.80% 0.75%
fee
------------------------------------------------------------------------------------------------------------------------------------
----------------------------------------
Shareholder Combined Combined
transaction Fund (Pro Fund
fees (paid Forma) (including
directly AmSouth
from your Capital
investment) Growth Fund)
(Pro
Forma)
Class Y Class Y
----------------------------------------
Maximum None None
sales charge
(load) when
you buy
shares as a
percentage
of offering
price
----------------------------------------
Maximum None None
deferred
sales charge
(load) as
a percentage
of purchase
price or the
amount you
receive when
you sell
shares,
whichever is
less
----------------------------------------
Redemption None None
fees
----------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as
a % of
average net
assets)
----------------------------------------
Management 0.75% 0.75%
fee
----------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined Combined AmSouth Pioneer Combined Combined AmSouth Pioneer
transaction Large Cap Oak Ridge Fund (Pro Fund Large Cap Oak Ridge Fund (Pro Fund Large Oak Ridge
fees (paid Fund(1) Fund Forma) (including Fund(1) Fund Forma) (including Cap Fund
directly AmSouth AmSouth Fund(1)
from your Capital Capital
investment) Growth Growth
Fund) (Pro Fund) (Pro
Forma) Forma)
Class A Class A Class A Class A Class B Class B Class B Class B Class I Class Y
------------------------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.25% 0.75% 1.00% 1.00% 1.00% None None
and service
(12b-1) fee
------------------------------------------------------------------------------------------------------------------------------------
Other 0.58%(5) 1.42% 0.21% 0.19% 0.61%(5) 1.19% 0.51% 0.45% 0.48%(5) 0.44%
expenses
------------------------------------------------------------------------------------------------------------------------------------
Total fund 1.38% 2.42%(6) 1.21% 1.19% 2.16% 2.94%(6) 2.26% 2.20% 1.28% 1.19%(6)
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
Expense 0.11% 1.12%(7) N/A N/A 0.14% 0.74%(7) 0.16%(8) 0.10%(8) 0.16% N/A
reimbursement/
reduction
------------------------------------------------------------------------------------------------------------------------------------
Net fund 1.27% 1.30% 1.21% 1.19% 2.02% 2.20% 2.10% 2.10% 1.12% 1.19%
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
----------------------------------------
Shareholder Combined Combined
transaction Fund (Pro Fund
fees (paid Forma) (including
directly AmSouth
from your Capital
investment) Growth Fund)
(Pro
Forma)
Class Y Class Y
----------------------------------------
Distribution None None
and service
(12b-1) fee
----------------------------------------
Other 0.13% 0.11%
expenses
----------------------------------------
Total fund 0.88% 0.86%
operating
expenses
----------------------------------------
Expense N/A N/A
reimbursement/
reduction
----------------------------------------
Net fund 0.88% 0.86%
operating
expenses
----------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.47% for Class A shares, 0.47% for Class B shares and 0.32% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(7) The expenses in the table above reflect the expense limitations currently in effect for the Pioneer Fund, under which Pioneer has contractually agreed to limit ordinary operating expenses to the extent required to reduce fund expenses to 1.30%, and 2.20% of the average daily net assets attributable to Class A and Class B shares, respectively. These expense limitations are in effect through April 1, 2008 for Class A shares and through April 1, 2006 for Class B shares. There can be no assurance that Pioneer will extend the expense limitations beyond such time.
(8) The expenses in the table above reflect the expense limitation in effect for Class B shares of the Pioneer Fund, under which Pioneer has contractually agreed to limit ordinary operating expenses to the extent required to reduce fund expenses 2.10% of the average daily net assets attributable Class B shares. This expense limitation is in effect through April 1, 2007. There can be no assurance that Pioneer will extend the expense limitations beyond such time.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same,. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------------------------
Combined Fund
(including AmSouth
Number of years you AmSouth Large Cap Pioneer Oak Ridge Large Combined Fund Capital Growth Fund)
own your shares Fund Cap Growth Fund (Pro Forma) (Pro Forma)
------------------------------------------------------------------------------------------------------------
Class A
------------------------------------------------------------------------------------------------------------
Year 1 $683 $700 $691 $689
------------------------------------------------------------------------------------------------------------
Year 3 $963 $963 $937 $931
------------------------------------------------------------------------------------------------------------
Year 5 $1,264 $1,485 $1,202 $1,192
------------------------------------------------------------------------------------------------------------
Year 10 $2,116 $2,913 $1,957 $1,935
------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
------------------------------------------------------------------------------------------------------------
Year 1 $719 $623 $613 $613
------------------------------------------------------------------------------------------------------------
Year 3 $976 $1,140 $975 $979
------------------------------------------------------------------------------------------------------------
Year 5 $1,359 $1,583 $1,280 $1,271
------------------------------------------------------------------------------------------------------------
Year 10 $2,295 $3,086 $2,304 $2,270
------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
------------------------------------------------------------------------------------------------------------
Year 1 $219 $223 $213 $213
------------------------------------------------------------------------------------------------------------
Year 3 $676 $840 $675 $679
------------------------------------------------------------------------------------------------------------
Year 5 $1,159 $1,483 $1,180 $1,171
------------------------------------------------------------------------------------------------------------
Year 10 $2,295 $3,086 $2,304 $2,270
------------------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------------------
Year 1 $130 $121 $90 $88
------------------------------------------------------------------------------------------------------------
Year 3 $406 $378 $281 $274
------------------------------------------------------------------------------------------------------------
Year 5 $702 $654 $488 $477
------------------------------------------------------------------------------------------------------------
Year 10 $1,545 $1,443 $1,084 $1,061
------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Large Cap Fund and its shareholders. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the historical investment performance of Pioneer Oak Ridge Large Cap Growth Fund is significantly better than your AmSouth Fund's investment performance. For the one and five year periods ended December 31, 2004, Class A shares of Pioneer Oak Ridge Large Cap Growth Fund had an average annual return of 4.96% (one year) and -0.54% (five year); compared to an average annual return of the Class A shares of your AmSouth Fund of -0.53% (one year); and -3.62% (five year); respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Third, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $26.7 billion in equity securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management
and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fourth, Pioneer Oak Ridge Large Cap Growth Fund's management fee (0.75% of average daily net assets) is lower than the advisory fee of your Fund (0.80% of average daily net assets). Although the historical gross and net expenses of Pioneer Oak Ridge Large Cap Growth Fund are higher than your Fund's historical gross and net expenses (except for Class Y shares), the estimated pro forma expenses of Class A and Class Y Shares of the Pioneer Fund after giving effect to the Reorganizations on both a gross and net basis are lower than your Fund's gross and net operating expenses for the Class A and I shares. Although the pro forma operating expenses for the Class B shares are estimated to increase slightly, this increase is partly the result of expense limitations on your AmSouth Fund that are voluntary and may be discontinued at any time. AmSouth Bank and its affiliates have informed the trustees that they will discontinue their expense limitations in the future. The trustees considered the positive factors associated with the Reorganization, such as the superior performance of the Pioneer Fund, to outweigh the negative factors, such as the increase in expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Fifth, the substantially larger size of the combined Pioneer Oak Ridge Large Cap Growth Fund will offer greater opportunity for diversification of the investment portfolio, which should help to reduce risks.
Sixth, the Class A, B and Y shares of Pioneer Oak Ridge Large Cap Growth Fund received in the Reorganization will provide AmSouth Large Cap Fund shareholders with exposure to substantially the same investment product as they currently have.
Seventh, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AAMI will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Capital Growth Fund approve the reorganization of their fund into Pioneer Oak Ridge Large Cap Growth Fund.
--------------------------------------------------------------------------------------------------------------------------------
Pro Forma
Pioneer Oak
Pro Forma Ridge Large Cap
Pioneer Oak Pioneer Oak Growth Fund
Ridge Large Cap Ridge Large (including
AmSouth Large Growth Cap Growth AmSouth Capital
Cap Fund Fund Fund Growth Fund)
May 31, 2005 May 31, 2005 May 31, 2005 May 31, 2005
--------------------------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $330,347 $220,176 $550,522 $799,086
--------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $113,684 $87,287 $200,971 $228,425
--------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $22,350 $10,999 $33,348 $40,130
--------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $194,313 $79,164 $273,477 $487,805
--------------------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
--------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $18.35 $12.66 $12.66 $12.66
--------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $17.35 $12.54 $12.54 $12.54
--------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $18.46 $12.70 $12.70 $12.70
--------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding
--------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $6,194,719 $6,895,166 $15,875,617 $18,044,318
--------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $1,288,165 $877,131 $2,659,432 $3,200,220
--------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $10,525,146 $6,234,510 $21,537,436 $38,416,647
--------------------------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Enhanced Market Fund and Pioneer Fund
PROPOSAL 1(c)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests primarily in the equity securities of large cap U.S. issuers and, consequently, has similar investment policies and risks. Your Fund, while not a pure index fund, seeks to track closely the S&P 500 Stock Index, while the Pioneer Fund is actively managed and does not have a goal of tracking an index. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Enhanced Market Fund to Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Delaware statutory
organized as a Massachusetts business trust. trust.
------------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, $190.38 million $6,463.4 million
2005
------------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Investment Subadviser: Portfolio Managers:
OakBrook Investments, LLC ("OakBrook") Day-to-day management of the Pioneer Fund's
portfolio is the responsibility of John
Portfolio Managers: A. Carey, portfolio manager, and Walter
Day-to-day management of AmSouth Enhanced Hunnewell, Jr., assistant portfolio manager.
Market Fund's portfolio is the responsibility Mr. Carey is director of portfolio management
of a team of investment professionals, all of and an executive vice president of Pioneer.
whom take part in the decision making Mr. Carey joined Pioneer in 1979. Mr.
process. Dr. Neil Wright, Ms. Janna Sampson Hunnewell is a vice president of Pioneer. Mr.
and Dr. Peter Jankovskis are the team members Hunnewell joined Pioneer in 2001 and has been
and have been the portfolio managers of the an investment professional for more than 16
Fund since its inception in 1998. Each of the years.
portfolio managers has been with OakBrook
since 1998.
Dr. Wright is OakBrook's President and Chief
Investment Officer. From 1993 to 1997, Dr.
Wright was the Chief Investment Officer of
ANB Investment Management & Trust Co.
("ANB").
Ms. Sampson is OakBrook's Director of
Portfolio Management. From 1993 to 1997, she
was Senior Portfolio Manager for ANB.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
Dr. Jankovskis is OakBrook's Director of
Research. From 1992 to 1996, he was an
Investment Strategist for ANB and from 1996
to 1997 he was the Manager of Research for
ANB.
------------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Enhanced Market Fund seeks to produce Pioneer Fund seeks reasonable income and
long-term growth of capital by investing in a capital growth through investment primarily
diversified portfolio of common stocks and in equity securities of U.S. issuers.
securities convertible into common stock such
as convertible bonds and convertible
preferred stock. Oakbrook does not currently
intend to purchase convertible securities.
------------------------------------------------------------------------------------------------------------------------------------
Primary investments AmSouth Enhanced Marked Fund normally invests Pioneer Fund invests a major portion of its
at least 80% of its total assets in equity assets in equity securities, primarily of
securities drawn from the S&P 500 Stock Index U.S. issuers. For purposes of the Fund's
(the "S&P 500"). investment policies, equity securities
include common stocks, convertible debt and
other equity instruments such as depositary
receipts, warrants, rights and preferred
stock.
------------------------------------------------------------------------------------------------------------------------------------
Investment strategies AmSouth Enhanced Market Fund invests in a Pioneer Fund uses a "value" style of
broadly diversified portfolio of stocks of management and seeks securities selling at
the companies comprising the S&P 500, reasonable prices or substantial discounts to
overweighting relative to their S&P weights their underlying values and then holds these
those that the subadviser believes to be securities until the market values reflect
undervalued compared to others in the S&P their intrinsic values. Pioneer looks at the
500. following factors in selecting investments:
favorable expected returns relative to
The Fund seeks to maintain risk perceived risk; about average potential for
characteristics similar to those of the S&P earnings and revenue growth; low market
500 and, normally, invests at least 80% of valuations relative to earnings forecast,
its assets in common stocks drawn from the book value, cash flow and sales; a
S&P 500. The Fund's investment subadviser sustainable competitive advantage such as a
does not currently intend to purchase brand name, customer base, proprietary
convertible securities. technology or economies of scale.
The subadviser's stock selection process
utilizes computer-aided quantitative
analysis. The subadviser's computer models
use many types of data, but emphasize
technical data such as price and volume
information. Applying these models to stocks
within the S&P 500, the subadviser hopes to
generate more capital growth than that of the
S&P 500. The subadviser's emphasis on
technical analyses can result in significant
shifts in portfolio holdings at different
times. However, stringent risk controls at
the style, industry and individual stock
levels help ensure the Fund maintains risk
characteristics similar to those of the S&P
500.
------------------------------------------------------------------------------------------------------------------------------------
Other investments AmSouth Enhanced Market Fund may invest Pioneer Fund may invest up to 10% of its total
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
up to 20% of its total assets in equity assets in equity and debt securities of
securities not held in the S&P 500, corporate non-U.S. corporate issuers and debt
bonds, notes, and warrants, and short-term securities of non-U.S. government issuers.
money market instruments. Stock futures and
option contracts, stock index futures and The Fund will not invest more than 5% of its
index option contracts may be used to hedge total assets in securities of emerging market
cash and maintain exposure to the U.S. equity issuers.
market.
The Fund may invest up to 5% of its net
assets in below investment grade debt
securities issued by both U.S. and non-U.S.
corporate and government issuers.
------------------------------------------------------------------------------------------------------------------------------------
Temporary defensive strategies When AAMI determines adverse market Pioneer Fund may invest all or part of its
conditions exist, AmSouth Enhanced Market assets in securities with remaining
Fund may invest entirely in cash positions, maturities of less than one year, cash
directly in U.S. Government securities and equivalents or may hold cash.
short-term paper, such as bankers'
acceptances.
------------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is diversified for the purpose of the Investment Company Act and is subject to
diversification requirements under the Internal Revenue Code of 1986, as amended (the "Code").
------------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Enhanced Market Fund may not purchase Pioneer Fund may not invest more than 25% of
any securities which would cause more than its assets in any one industry.
25% of the value of the Fund's total assets
at the time of purchase to be invested in
securities of one or more issuers conducting
their principal business activities in the
same industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the U.S.
government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their
activities are primarily related to financing
the activities of their parents; and (c)
utilities will be divided according to their
services. For example, gas, gas transmission,
electric and gas, electric, and telephone
will each be considered a separate industry.
------------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Enhanced Market Fund may not invest Pioneer Fund may not invest more than 15% of
securities more than 15% of its net assets in securities its net assets in securities that are
that are restricted as to resale, or for illiquid and other securities that are not
which no readily available market exists, readily marketable. Repurchase agreements
including repurchase agreements providing for maturing in more than seven days will be
settlement more than seven days after notice. included for purposes of the foregoing limit.
------------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Enhanced Market Fund may not borrow Pioneer Fund may not borrow money, except the
money or issue senior securities, except the Fund may: (a) borrow from banks or through
Fund may borrow from banks or enter into reverse repurchase agreements in an amount up
reverse repurchase agreements for temporary to 33 1/3% of the Fund's total
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
emergency purposes in amounts up to 33 1/3% assets (including the amount borrowed); (b)
of the value of its total assets at the time borrow up to an additional 5% of the Fund's
of such borrowing. The Fund will not purchase assets for temporary purposes; (c) obtain
securities while borrowings (including such short-term credits as are necessary for
reverse repurchase agreements) in excess of the clearance of portfolio transactions; (d)
5% of its total assets are outstanding. In purchase securities on margin to the extent
addition, the Fund is permitted to permitted by applicable law; and (e) engage
participate in a credit facility whereby the in transactions in mortgage dollar rolls that
Fund may directly lend to and borrow money are accounted for as financings.
from other AmSouth funds for temporary
purposes, provided that the loans are made in
accordance with an order of exemption from
the SEC and any conditions thereto.
------------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Enhanced Market Fund may not make Pioneer Fund may not make loans, except that
loans, except that the Fund may purchase or the Fund may (i) lend portfolio securities in
hold debt instruments in accordance with its accordance with the Fund's investment
investment objective and policies, lend Fund policies, (ii) enter into repurchase
securities in accordance with its investment agreements, (iii) purchase all or a portion
objective and policies and enter into of an issue of publicly distributed debt
repurchase agreements. In addition, the Fund securities, bank loan participation
is permitted to participate in a credit interests, bank certificates of deposit,
facility whereby the Fund may directly lend bankers' acceptances, debentures or other
to and borrow money from other AmSouth funds securities, whether or not the purchase is
for temporary purposes, provided that the made upon the original issuance of the
loans are made in accordance with an order of securities, (iv) participate in a credit
exemption from the SEC and any conditions facility whereby the Fund may directly lend
thereto. to and borrow money from other affiliated
funds to the extent permitted under the
Investment Company Act or an exemption
therefrom, and (v) make loans in any other
manner consistent with applicable law, as
amended and interpreted or modified from time
to time by any regulatory authority having
jurisdiction.
------------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Enhanced Market Fund may invest in Pioneer Fund may use futures and options on
futures contracts and options thereon securities, indices and currencies, forward
(interest rate futures contracts or index currency exchange contracts and other
futures contracts, as applicable) to commit derivatives. The Fund does not use
funds awaiting investment, to maintain cash derivatives as a primary investment technique
liquidity or for other hedging purposes. and generally limits their use to hedging.
Stock futures and option contracts, stock However, the Fund may use derivatives for a
index futures and index option contracts may variety of non-principal purposes, including:
be used to hedge cash and maintain exposure
to the U.S. equity market. The value of the o As a hedge against adverse changes in
Fund's contracts may equal or exceed 100% of stock market prices, interest rates or
the Fund's total assets, although the Fund currency exchange rates
will not purchase or sell a futures contract
unless immediately afterwards the aggregate o As a substitute for purchasing or selling
amount of margin deposits on its existing securities
futures positions plus the amount of premiums
paid for related futures options entered into o To increase the Fund's return as a
for other than bona fide hedging purposes is non-hedging strategy that may be
5% or less of its net assets. considered speculative
------------------------------------------------------------------------------------------------------------------------------------
Short-term trading AmSouth Enhanced Market Fund may engage Pioneer Fund does not usually trade for short-
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
in the technique of short-term trading. Such term profits. The Fund will sell an
trading involves the selling of securities investment, however, even if it has only been
held for a short-time, ranging from several held for a short time, if it no longer meets
months to less than a day. The object of such the Fund's investment criteria.
short-term trading is to increase the
potential for capital appreciation and/or
income of the Fund in order to take advantage
of what OakBrook believes are changes in
market, industry or individual company
conditions or outlook.
------------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------------
Class A sales charges Class A shares are offered with an initial Class A shares are offered with an initial
and Rule 12b-1 Fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may Funds Distributor, Inc. ("PFD"), the Fund's
be charged a contingent deferred sales charge distributor, of up to 5% declining as the
("CDSC") of 1.00% if sold within one year of size of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing circumstances when the initial sales charge
fee (12b-1) of up to 0.25% of average daily is waived.
net assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Class B sales charges Class B shares are offered without an initial Class B shares are offered without an initial
and Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive
continuously declines over six years, a commission from PFD, the Fund's
starting with year one and ending in year distributor, at the time of your purchase of
seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all up to 4%.
other Class B shares held continuously, the
CDSC declines over six years, starting with Class B shares are subject to distribution
year one and ending in year seven from: 5%, and service (12b-1) fees of up to 1% of
4%, 3%, 3%, 2%, 1%. Eight years after average daily net assets.
purchase (seven years in the case of shares
acquired in the ISG combination), Class B Maximum purchase of Class B shares in a
shares automatically convert to Class A single transaction is $49,999.
shares.
Class B shares acquired through the
Class B shares pay a shareholder servicing Reorganization will be subject to the CDSC
fee (non 12b-1) of up to 0.25% of average and commission schedules applicable to the
daily net assets and a distribution (12b-1)
fee of 0.75%
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
of average daily net assets. original purchase.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y sales AmSouth Enhanced Market Fund does not impose The Fund does not impose any initial,
charges and Rule 12b-1 fees any initial or CDSC on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth Enhanced Market Fund pays an advisory Pioneer Fund pays Pioneer an annual basic fee
fee on a monthly basis at an annual rate of of 0.60% of the Fund's average daily net
0.35% of the Fund's average daily net assets. assets. The fee is computed daily and paid
monthly.
ASO Services Company, Inc. ("ASO") serves as
administrator and fund accounting agent for Pioneer's fee increases or decreases
the Fund. The Fund pays ASO an administrative depending upon whether the Fund's performance
services fee of 0.15% of the Fund's average exceeds, or is exceeded by, that of the S&P
daily net assets. 500 Index over a rolling three year
performance period. Each percentage point of
Other expenses of the Fund are being limited difference between the performance of the
to 0.50% for Class A shares, 0.50% for Class Class A shares and the index (limited to a
B shares and 0.35% for Class I shares. Any maximum of +/-10) is multiplied by a
fee waiver or expense reimbursement performance rate adjustment of 0.01%. As a
arrangement is voluntary and may be result, the fee is subject to a maximum
discontinued at any time. annualized rate adjustment of +/-0.10%. This
performance comparison is made at the end of
For the fiscal year ended July 31, 2004, the each month. An appropriate monthly percentage
Fund's annual operating expenses for Class A of this annual rate (based on the number of
shares, after giving effect to the expense days in the current month) is then applied to
limitation were 0.85%, and without giving the Fund's average net assets for the entire
effect to the expense limitation, were 0.87% 36-month performance period, giving a dollar
of average daily net assets. amount that is added to (or subtracted from)
the basic fee. In addition, the fee is also
For the fiscal year ended July 31, 2004, the further limited to a maximum annualized rate
Fund's annual operating expenses for Class B adjustment of +/-0.10% (i.e., the management
shares, after giving effect to the expense fee will not exceed 0.70% or be less than
limitation were 1.60%, and without giving 0.50%) on average daily net assets for the
effect to the expense limitation, were 1.62% current year. However, Pioneer currently is
of average daily net assets. waiving the lower limitation on its fee, but
may reimpose it in the future. Because any
For the fiscal year ended July 31, 2004, the adjustments to the basic fee begin with the
Fund's annual operating expenses for Class I comparative performance of the Fund and the
shares, after giving effect to the expense performance record of the index, the
limitation were 0.70%, and without giving controlling factor is not whether fund
effect to the expense limitation, were 0.77% performance is up or down, but whether it is
of average daily net assets. up or down more or less than the performance
record of the index, regardless of general
market performance. During its most
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
recent fiscal year, the Pioneer Fund paid an
advisory fee at an average rate of 0.53% of
average daily net assets.
In addition, the Fund reimburses Pioneer for
certain fund accounting and legal expenses
incurred on behalf of the Fund and pays a
separate shareholder servicing/transfer
agency fee to PIMSS, an affiliate of Pioneer.
For the fiscal year ended December 31, 2004,
the Fund's total annual operating expenses
for Class A shares were 1.06% of average
daily net assets.
For the fiscal year ended December 31, 2004,
the Fund's total annual operating expenses
for Class B shares were 1.92% of average
daily net assets.
For the fiscal year ended December 31, 2004,
the Fund's total annual operating expenses
for Class Y shares were 0.61% of average
daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other
financial institutions that have entered into If the account is established in the
selling agreements with the Fund's shareholder's own name, shareholders may also
distributor, as described in the Fund's purchase additional shares of the Pioneer
prospectus. Fund by telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
Fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one Fund to charging you either an initial or contingent
another are taxable. Class A shares may be deferred shares charge at the time of the
exchanged for Class I shares of the same Fund exchange. Shares you acquire as part of an
or another AmSouth Fund if you become exchange will continue to be subject to any
eligible to purchase Class I shares. Class I contingent deferred sales charge that applies
shares may be exchanged for Class A shares of to the shares you originally purchased. When
the same Fund. No transaction fees are you ultimately sell your shares, the date of
currently charged for exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days purchase of shares for federal income tax
of the date of purchase, you will be charged purposes.
a 2.00% fee on the current net asset value of
the
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund Pioneer Fund
------------------------------------------------------------------------------------------------------------------------------------
shares sold or exchanged. The fee is paid to After you establish an eligible fund account,
the Fund to offset the costs associated with you can exchange Fund shares by telephone or
short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares
purchased first will be considered redeemed
first for purposes of determining whether the
redemption fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan
administrator or brokerage firm to implement
the fee). The Fund will not impose the
redemption fee on a redemption or exchange of
shares purchased upon the reinvestment of
dividend and capital gain distributions.
------------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
--------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Pioneer Fund by
telephone or online.
------------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o In the case of the Pioneer Fund, value stocks fall out of favor with investors
o The Fund's assets remain undervalued or do not have the potential value originally expected
o Stocks selected for income do not achieve the same return as securities selected for capital growth
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Enhanced Market Fund --Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]
1999 2000 2001 2002 2003 2004 21.05 -8.24 -12.58 -23.47 27.81 10.05 |
* During the period shown in the bar chart since the Fund's inception September 1, 1998, your AmSouth Fund's highest quarterly return was 15.38% for the quarter ended June 30, 2003, and the lowest quarterly return was -18.14% for the quarter ended September 30, 2002.
Pioneer Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 26.76 19.7 38.47 29.09 15.54 0.12 -11.13 -20.26 24.58 11.64 |
* During the period shown in the bar chart Pioneer Fund's highest quarterly return was 22.33% for the quarter ended December 31, 1998, and the lowest quarterly return was -18.18% for the quarter ended September 30, 2002.
AmSouth Enhanced Market Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
(9/1/98)
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Marked Fund, Class A Shares(1)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 3.98% -3.99% 3.82%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 3.01% -4.39% 3.21%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 3.24% -3.48% 3.01%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Marked Fund, Class B Shares(1)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 4.18% -4.00% 3.95%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Market Fund, Class I Shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 10.14% -2.75% 4.91%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 9.09% -3.19% 4.25%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 7.28% -2.47% 3.93%
---------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index(3) 10.87% -2.30% 4.71%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 9/1/98. Performance for the Class B shares, which were first offered on 9/2/98, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the contingent deferred sales charge.
(2) Performance for the Class I shares, which were first offered on 12/11/98, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date.
(3) The S&P 500, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The above table shows the impact of taxes on AmSouth Enhanced Market Fund's returns. After-tax returns are only shown for Class A shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Fund Average Annual Total Returns as of December 31, 2004
------------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years 10 Years Since Inception
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Fund, Class A shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 5.21% -1.44% 11.29% 12.50% (2/13/28)
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 4.90% -1.95% 10.00% 8.84%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund 3.37% -1.42% 9.36% 8.73%
Shares(1)
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Fund, Class B shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 6.68% -1.14% N/A 9.01% (7/1/96)
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Fund, Class Y shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 12.15% 0.16% 0.16% 12.61% (2/13/28)(3)
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 11.64% -0.49% -0.49% 8.94%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund 7.78% -0.15% -0.15% 8.83%
Shares(1)
------------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index(2) 10.87% -2.30% -2.30% 10.11%(4)
(reflects no deduction for fees, expenses or taxes)
------------------------------------------------------------------------------------------------------------------------------------
|
(1) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown, and the after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
(2) The S&P 500 Index, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
(3) Reflects the inception date of the Fund's Class A shares. The inception date of the Fund's Class Y shares was May 6, 1999.
(4) Reflects the return of the index since the inception of Class A shares. The return of the index is 8.90% since the inception of Class B shares.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Enhanced Market Fund, the expenses of AmSouth Enhanced Marked Fund for the period ended January 31, 2005, and (ii) for Pioneer Fund, the expenses of Pioneer Fund for the period ended October 31, 2004. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on October 31, 2004.
------------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Combined AmSouth Pioneer Combined
transaction Enhanced Fund Fund (Pro Enhanced Fund Fund (Pro Enhanced Fund Fund (Pro
fees (paid Marked Forma) Marked Forma) Marked Forma)
directly from Fund(1) Fund(1) Fund(1)
your
investment) Class A Class A Class A Class B Class B Class B Class I Class Y Class Y
------------------------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75%(2) 5.75%(2) None None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
------------------------------------------------------------------------------------------------------------------------------------
Maximum None None None 5.00%(3) 4.00% 4.00% None None None
deferred sales
charge (load)
as a
percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
------------------------------------------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None 2.00%(4) None None 2.00%(4) None None
fees
------------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Combined AmSouth Pioneer Combined
transaction Enhanced Fund Fund (Pro Enhanced Fund Fund (Pro Enhanced Fund Fund (Pro
fees (paid Marked Forma) Marked Forma) Marked Forma)
directly from Fund(1) Fund(1) Fund(1)
your
investment) Class A Class A Class A Class B Class B Class B Class I Class Y Class Y
------------------------------------------------------------------------------------------------------------------------------------
Management fee 0.35% 0.53%(6) 0.53%(6) 0.35% 0.53%(6) 0.53%(6) 0.35% 0.53%(6) 0.53%(6)
------------------------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.75% 1.00% 1.00% None None None
and service
(12b-1) fee
------------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.65%(5) 0.28% 0.27% 0.71%(5) 0.40% 0.39% 0.53%(5) 0.01% 0.07%
------------------------------------------------------------------------------------------------------------------------------------
Total fund 1.00% 1.06%(7) 1.05% 1.81% 1.93%(7) 1.92% 0.88% 0.61%(7) 0.60%
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
Expense 0.09% N/A N/A 0.15% N/A N/A 0.12% N/A N/A
reimbursement/
reduction
------------------------------------------------------------------------------------------------------------------------------------
Net fund 0.91% 1.06% 1.05% 1.66% 1.93% 1.92% 0.76% 0.61% 0.60%
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.56% for Class A shares, 0.56% for Class B shares and 0.41% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) Pioneer Fund pays a management fee that ranges from 0.50% to 0.70% of average daily net assets based on its performance.
(7) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------------------------ Number of years you AmSouth Enhanced Marked Fund Pioneer Fund Combined Fund own your shares (Pro Forma) ------------------------------------------------------------------------------------------------------------ Class A ------------------------------------------------------------------------------------------------------------ Year 1 $646 $667 $676 ------------------------------------------------------------------------------------------------------------ Year 3 $851 $893 $890 ------------------------------------------------------------------------------------------------------------ Year 5 $1,072 $1,126 $1,121 ------------------------------------------------------------------------------------------------------------ |
------------------------------------------------------------------------------------------------------------
Year 10 $1,707 $1,795 $1,784
------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
------------------------------------------------------------------------------------------------------------
Year 1 $684 $596 $595
------------------------------------------------------------------------------------------------------------
Year 3 $869 $906 $903
------------------------------------------------------------------------------------------------------------
Year 5 $1,180 $1,142 $1,137
------------------------------------------------------------------------------------------------------------
Year 10 $1,914 $2,028 $2,017
------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
------------------------------------------------------------------------------------------------------------
Year 1 $184 $196 $195
------------------------------------------------------------------------------------------------------------
Year 3 $569 $606 $603
------------------------------------------------------------------------------------------------------------
Year 5 $980 $1,042 $1,037
------------------------------------------------------------------------------------------------------------
Year 10 $1,914 $2,028 $2,017
------------------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------------------
Year 1 $90 $62 $61
------------------------------------------------------------------------------------------------------------
Year 3 $281 $195 $192
------------------------------------------------------------------------------------------------------------
Year 5 $488 $340 $335
------------------------------------------------------------------------------------------------------------
Year 10 $1084 $762 $750
------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Enhanced Market Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, after the Reorganization, the combined Fund will have an asset size substantially larger than that of your AmSouth Fund, which may allow the combined Fund to achieve significant economies of scale in investments or expenses.
Third, the historical investment performance of Pioneer Fund is superior to your AmSouth Fund's investment performance. For the one and five year periods ended December 31, 2004, Class A shares of Pioneer Fund had an average annual return of 5.21% (one year); and -1.44% (five year); compared to an average annual return of the Class A shares of your AmSouth Fund of 3.98% (one year); and -3.99% (five year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Fourth, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $26.7 billion in equity securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fifth, the Trustees recognized that Pioneer Fund's operating expenses for Class A and Class B shares, both gross and net of expense limitations, and its management fee, are higher than your Fund's expenses for Class A and Class B shares and your Fund's management fee. They also noted that on a pro forma basis, after giving effect to the Reorganization, the expenses of the Pioneer Fund's Class A and Class B shares were estimated to be higher that your Fund's expenses for Class A and Class B shares both on a gross and a net basis, though the gross and net expenses of your Fund's Class I shares would decline. The Trustees noted that the differential in fees can be explained by the fact that the Pioneer Fund is more actively managed, while the AmSouth Fund is an enhanced index fund, and index funds traditionally have substantially lower fees than actively
managed funds. The Trustees considered that the other advantages of the Reorganization were sufficient to make up for the higher expenses of the Pioneer Fund. The Trustees also considered that the aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Sixth, the substantially larger size of Pioneer Fund will offer greater opportunity for diversification of the investment portfolio, which should help to reduce risks.
Seventh, the Class A, B and Y shares of Pioneer Fund received in the Reorganization will provide AmSouth Enhanced Market Fund shareholders with exposure to substantially the same investment product as they currently have.
Eighth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares. Although the Reorganization will result in a per share increase in net unrealized capital gains and decrease in capital loss carryforwards, the potential negative tax consequences of these aspects of the Reorganization are outweighed by the advantages of the Reorganization.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
--------------------------------------------------------------------------------------------------------------------
AmSouth Enhanced Pro Forma Pioneer
Market Fund Pioneer Fund Fund
May 31, 2005 May 31, 2005 May 31, 2005
--------------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $190,688 $6,958,502 $7,149,190
--------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $27,264 $5,448,914 $5,476,179
--------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $10,392 $492,629 $503,021
--------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $153,032 $164,592 $317,624
--------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
--------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $11.66 $41.71 $41.71
--------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $11.39 $40.73 $40.73
--------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $11.69 $41.84 $41.84
--------------------------------------------------------------------------------------------------------------------
Shares Outstanding
--------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $2,337,280 $130,631,789 $131,285,421
--------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $912,719 $12,094,860 $12,350,007
--------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $13,094,306 $3,933,930 $7,591,555
--------------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Value Fund and Pioneer Value Fund
PROPOSAL 1(d)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests primarily in equity securities of U.S. issuers using a value oriented investment approach and, consequently, the Funds have similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Value Fund to Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Delaware statutory
organized as a Massachusetts business trust. trust.
------------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, $498.2 million $4,066.0 million
2005
------------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Portfolio Managers:
AmSouth Value Fund is managed by Brian B. Day-to-day management of Pioneer Value Fund's
Sullivan, CFA (since June 2004). Mr. Sullivan portfolio is the responsibility of J. Rodman
has been an officer of AAMI since 1996 and Wright, lead portfolio manager. Mr. Wright is
joined AmSouth Bank in 1982. Prior to serving supported by Aaron C. Clark, portfolio
as Director of Fixed Income for AmSouth manager, and the domestic equity team.
Bank's Trust Department, Mr. Sullivan managed Members of this team manage other Pioneer
equity portfolios and held the position of funds investing primarily in U.S. equity
equity research coordinator for AmSouth securities.
Bank's Trust Department.
Mr. Wright is a senior vice president of
Pioneer and strategy director of the value
team. He joined Pioneer in 1994 as an analyst
and has been an investment professional since
1988. Mr. Clark is a vice president and
joined Pioneer in 2004 as a portfolio
manager. Prior to joining Pioneer, Mr. Clark
was employed as a portfolio manager at Morgan
Stanley Investment Management from 1997 to
2004 and has been an investment professional
since 1992.
------------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Value Fund seeks long-term capital Pioneer Value Fund seeks reasonable income
growth by investing primarily in a and capital growth primarily through equity
diversified portfolio of common stock and securities.
securities
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
convertible into common stock, such as
convertible bonds and convertible preferred
stock. The production of current income is an
incidental objective.
------------------------------------------------------------------------------------------------------------------------------------
Primary investments AmSouth Value Fund normally invests at least Pioneer Value Fund seeks to invest in a broad
80% of its total assets in common stocks and list of carefully selected, reasonably priced
securities convertible into common stocks, securities rather than in securities whose
such as convertible bonds and convertible prices reflect a premium resulting from their
preferred stocks. The Fund invests primarily current market popularity. Pioneer Value Fund
in common stocks that AAMI believes to be invests the major portion of its assets in
undervalued. equity securities, primarily of U.S. issuers.
For purposes of the Fund's investment
policies, equity securities include common
stocks, convertible debt and other equity
instruments, such as depositary receipts,
warrants, rights and preferred stocks.
Pioneer Value Fund may invest up to 25% of
its assets in the equity securities of
non-U.S. companies.
------------------------------------------------------------------------------------------------------------------------------------
Investment strategies In managing the AmSouth Value Fund's Pioneer uses a "value" approach to select
portfolio, AAMI combines fundamental and Pioneer Value Fund's investments. Pioneer
quantitative analysis with risk management to evaluates a security's potential value,
identify value opportunities, construct the including the attractiveness of its market
portfolio and make purchase and sale valuation, based on the company's assets and
decisions. AAMI selects investments it prospects for earnings and revenue growth.
believes have basic investment value that Factors Pioneer looks for in selecting
will eventually be recognized by other investments include:
investors, thus increasing their value to the
Fund. o Above average potential for earnings and
revenue growth
o Favorable expected returns relative to
perceived risks
o Management with demonstrated ability and
commitment to the company
o Low market valuations relative to earnings
forecast, book value, cash flow and sales
o Turnaround potential for companies that
have been through difficult periods
o Good prospects for dividend growth
------------------------------------------------------------------------------------------------------------------------------------
Other investments AmSouth Value Fund may invest up to 20% of Pioneer Value Fund may invest up to 25% of
the value of its total assets in preferred its assets in the equity securities of
stocks, corporate bonds, notes, and warrants, non-U.S. companies. The Fund will not invest
and short-term money market instruments. more than 5% of its total assets in the
securities of emerging market issuers.
AmSouth Value Fund may purchase securities on
a when-issued basis (i.e., for delivery Pioneer Value Fund may invest the balance of
beyond the normal settlement date at a stated its assets in debt securities of corporate
price and yield). The Fund expects that and government issuers. The Fund may invest
up
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
commitments to purchase "when-issued" to 5% of its net assets in below investment
securities will not exceed 25% of the value grade debt securities issued by both U.S. and
of its total assets under normal market non-U.S. corporate and government issuers,
conditions, and that a commitment to purchase including convertible debt securities.
"when-issued" securities will not exceed 60
days.
------------------------------------------------------------------------------------------------------------------------------------
Temporary defensive strategies When AAMI determines adverse market Pioneer Value Fund may invest all or part of
conditions exist, AmSouth Value Fund may its assets in securities with remaining
invest entirely in cash positions, directly maturities of less than one year, cash
in U.S. Government securities and short-term equivalents or may hold cash.
paper, such as bankers' acceptances.
------------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is diversified for the purpose of the Investment Company Act and is subject to
diversification requirements under the Internal Revenue Code of 1986, as amended (the "Code").
------------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Value Fund may not purchase any Pioneer Value Fund may not invest more than
securities which would cause more than 25% of 25% of its assets in any one industry.
the value of the Fund's total assets at the
time of purchase to be invested in securities
of one or more issuers conducting their
principal business activities in the same
industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the U.S.
government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their
activities are primarily related to financing
the activities of their parents; and (c)
utilities will be divided according to their
services. For example, gas, gas transmission,
electric and gas, electric, and telephone
will each be considered a separate industry.
------------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Value Fund may not invest more than Pioneer Value Fund may not invest more than
securities 15% of its net assets in securities that are 15% of its net assets in securities that are
restricted as to resale, or for which no illiquid and other securities that are not
readily available market exists, including readily marketable. Repurchase agreements
repurchase agreements providing for maturing in more than seven days will be
settlement more than seven days after notice. included for purposes of the foregoing limit.
------------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Value Fund may not borrow money or Pioneer Value Fund may not borrow money,
issue senior securities, except that the Fund except the Fund may: (a) borrow from banks or
may borrow from banks or enter into reverse through reverse repurchase agreements in an
repurchase agreements for temporary emergency amount up to 33 1/3% of the Fund's total
purposes in amounts up to 33 1/3% of the assets (including the amount borrowed); (b)
value of its total assets at the time of such to the extent permitted by applicable law,
borrowing. The Fund will not purchase borrow up to an additional 5% of the Fund's
securities while borrowings (including assets for temporary purposes; (c) obtain
reverse repurchase agreements) in excess of such short-term credits as are necessary for
5% of its total assets are outstanding. In the clearance of portfolio transactions; (d)
addition, the Fund is permitted to purchase securities on margin to the extent
participate in a credit permitted by
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
facility whereby the Fund may directly lend applicable law; and (e) engage in
to and borrow money from other AmSouth funds transactions in mortgage dollar rolls that
for temporary purposes, provided that the are accounted for as financings.
loans are made in accordance with an order of
exemption from the SEC and any conditions
thereto.
------------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Value Fund may not make loans, except Pioneer Value Fund may not make loans, except
that the Fund may purchase or hold debt that the Fund may (i) lend portfolio
instruments in accordance with its investment securities in accordance with the Fund's
objective and policies, lend Fund securities investment policies, (ii) enter into
in accordance with its investment objective repurchase agreements, (iii) purchase all or
and policies and enter into repurchase a portion of an issue of publicly distributed
agreements. In addition, the Fund is debt securities, bank loan participation
permitted to participate in a credit facility interests, bank certificates of deposit,
whereby the Fund may directly lend to and bankers' acceptances, debentures or other
borrow money from other AmSouth Funds for securities, whether or not the purchase is
temporary purposes, provided that the loans made upon the original issuance of the
are made in accordance with an order of securities, (iv) participate in a credit
exemption from the SEC and any conditions facility whereby the Fund may directly lend
thereto. to and borrow money from other affiliated
funds to the extent permitted under the
Investment Company Act or an exemption
therefrom, and (v) make loans in any other
manner consistent with applicable law, as
amended and interpreted or modified from time
to time by any regulatory authority having
jurisdiction.
------------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Value Fund may invest in futures Pioneer Value Fund may use futures and
contracts and options thereon (interest rate options on securities, indices and
futures contracts or index futures contracts, currencies, forward currency exchange
as applicable) to commit funds awaiting contracts and other derivatives. The Fund
investment, to maintain cash liquidity or for does not use derivatives as a primary
other hedging purposes. The value of the investment technique and generally limits
Fund's contracts may equal or exceed 100% of their use to hedging. However, the Fund may
the Fund's total assets, although the Fund use derivatives for a variety of
will not purchase or sell a futures contract non-principal purposes, including:
unless immediately afterwards the aggregate
amount of margin deposits on its existing o As a hedge against adverse changes in
futures positions plus the amount of premiums stock market prices, interest rates or
paid for related futures options entered into currency exchange rates
for other than bona fide hedging purposes is
5% or less of its net assets. o As a substitute for purchasing or selling
securities
o To increase the Fund's return as a
non-hedging strategy that may be
considered speculative
------------------------------------------------------------------------------------------------------------------------------------
Short-term trading AmSouth Value Fund may engage in the Pioneer Value Fund does not usually trade for
technique of short-term trading. Such trading short-term profits. The Fund will sell an
involves the selling of securities held for a investment, however, even if it has only been
short-time, ranging from several months to held for a short time, if it no longer meets
less than a day. The object of such the Fund's investment criteria.
short-term trading is to increase the
potential for capital appreciation and/or
income of the Fund in order to take advantage
of what AAMI believes
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
are changes in market, industry or individual
company outlook.
------------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 Fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may Funds Distributor, Inc. ("PFD'), the Fund's
be charged a contingent deferred sales charge distributor, of up to 5% declining as the
("CDSC") of 1.00% if sold within one year of size of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing circumstances when the initial sales charge
fee (non 12b-1) of up to 0.25% of average is waived.
daily net assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive
continuously declines over six years, a commission from PFD, the Fund's
starting with year one and ending in year distributor, at the time of your purchase of
seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all up to 4%.
other Class B shares held continuously, the
CDSC declines over six years, starting with Class B shares are subject to distribution
year one and ending in year seven from: 5%, and service (12b-1) fees of up to 1% of
4%, 3%, 3%, 2%, 1%. Eight years after average daily net assets.
purchase (seven years in the case of shares
acquired in the ISG combination), Class B Maximum purchase of Class B shares in a
shares automatically convert to Class A single transaction is $49,999.
shares.
Class B shares acquired through the
Class B shares pay a shareholder servicing Reorganization will be subject to the CDSC
fee (non 12b-1) of up to 0.25% of average and commission schedules applicable to the
daily net assets and a distribution (12b-1) original purchase.
fee of 0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y AmSouth Value Fund does not impose any The Fund does not impose any initial,
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
sales charges and initial or CDSC on Class I shares. contingent deferred or asset based sales
Rule 12b-1 fees charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth Value Fund pays an advisory fee on a Pioneer Value Fund pays Pioneer an annual
monthly basis at an annual rate of 0.80% of basic fee of 0.60% of the Fund's average
the Fund's average daily net assets. daily net assets, which fee is reduced at
asset levels above $5 billion. The fee is
ASO Services Company, Inc. ("ASO") serves as computed daily and paid monthly.
administrator and fund accounting agent for
the Fund. The Fund pays ASO an administrative Pioneer's fee increases or decreases
services fee of 0.15% of the Fund's average depending upon whether the Fund's performance
daily net assets. exceeds, or is exceeded by, that of the S&P
500 Index over a rolling three-year
Other expenses of the Fund are being limited performance period. Each percentage point of
to 0.49% for Class A shares, 0.49% for Class difference between the performance of the
B shares and 0.34% for Class I shares. Any Class A shares and the index (limited to a
fee waiver or expense reimbursement maximum of +/-10) is multiplied by a
arrangement is voluntary and may be performance rate adjustment of 0.01%. As a
discontinued at any time. result, the fee is subject to a maximum
annualized rate adjustment of +/-0.10%. This
For the fiscal year ended July 31, 2004, the adjustment factor is applied to the average
Fund's annual operating expenses for Class A net assets during the 36-month period. This
shares, after giving effect to the expense performance comparison is made at the end of
limitation were 1.29%, and without giving each month. An appropriate monthly percentage
effect to the expense limitation, were 1.31% of this annual rate (based on the number of
of average daily net assets. days in the current month) is then applied to
the Fund's average net assets for the entire
For the fiscal year ended July 31, 2004, the performance period, giving a dollar amount
Fund's annual operating expenses for Class B that is added to (or subtracted from) the
shares, after giving effect to the expense basic fee. In addition, the fee is also
limitation were 2.04%, and without giving further limited to a maximum annualized rate
effect to the expense limitation, were 2.06% adjustment of +/-0.10% (i.e., the management
of average daily net assets. fee will not exceed 0.70% or be less than
0.50%) on average daily net assets for the
For the fiscal year ended July 31, 2004, the current year. However, Pioneer currently is
Fund's annual operating expenses for Class I waving the lower limitation on its fee, but
shares, after giving effect to the expense may reimpose it in the future. Because any
limitation were 1.14%, and without giving adjustments to the basic fee begin with the
effect to the expense limitation, were 1.21% comparative performance of the Fund and the
of average daily net assets. performance record of the index, the
controlling factor is not whether Fund
performance is up or down, but whether it is
up or down more or less than the performance
record of the index, regardless of general
market performance. During its most recent
fiscal year, Pioneer Value Fund paid an
advisory fee at an average rate of 0.60% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
In addition, the Fund reimburses Pioneer for
certain fund accounting and legal expenses
incurred on behalf of the Fund and pays a
separate shareholder servicing/transfer
agency fee to PIMSS, an affiliate of Pioneer.
For the fiscal year ended December 31, 2004,
the Fund's total annual operating expenses
for Class A shares were 1.02% of average
daily net assets.
For the fiscal year ended December 31, 2004,
the Fund's total annual operating expenses
for Class B shares were 1.89% of average
daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other
financial institutions that have entered into If the account is established in the
selling agreements with the Fund's shareholder's own name, shareholders may also
distributor, as described in the Fund's purchase additional shares of the Fund by
prospectus. telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer fund. Your
Fund, usually without paying additional sales exchange request must be for at least $1,000.
charges. You must meet the minimum investment The Fund allows you to exchange your shares
requirements for the Fund into which you are at net asset value without charging you
exchanging. Exchanges from one Fund to either an initial or contingent deferred
another are taxable. Class A shares may be shares charge at the time of the exchange.
exchanged for Class I shares of the same Fund Shares you acquire as part of an exchange
or another AmSouth Fund if you become will continue to be subject to any contingent
eligible to purchase Class I shares. Class I deferred sales charge that applies to the
shares may be exchanged for Class A shares of shares you originally purchased. When you
the same Fund. No transaction fees are ultimately sell your shares, the date of your
currently charged for exchanges. original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days purchase of shares for federal income tax
of the date of purchase, you will be charged purposes.
a 2.00% fee on the current net asset value of
the shares sold or exchanged. The fee is paid After you establish an eligible fund account,
to the Fund to offset the costs associated you can exchange Fund shares by telephone or
with short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares
purchased first will be
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund Pioneer Value Fund
------------------------------------------------------------------------------------------------------------------------------------
considered redeemed first for purposes of
determining whether the redemption fee will
be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan
administrator or brokerage firm to implement
the fee). The Fund will not impose the
redemption fee on a redemption or exchange of
shares purchased upon the reinvestment of
dividend and capital gain distributions.
------------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
--------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
------------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o Value stocks fall out of favor with investors
o The Fund's assets remain undervalued or do not have the potential value originally expected
Pioneer Value Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Fund invests in issuers in countries with emerging markets or if the Fund invests significantly in one country. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the adviser/subadviser might not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
In addition, at times, more than 25% of Pioneer Value Fund's assets may be invested in the same market segment, such as financials or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Value Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 27.39 15.74 32.3 17.61 3.86 5.08 4.08 -29.31 25.08 15.14 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 18.35% for the quarter ended June 30, 2003, and the lowest quarterly return was -26.41% for the quarter ended September 30, 2002.
Pioneer Value Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 27.15 21.99 23.7 -7.99 1.61 15.95 -3.08 -18.79 28.54 12.26 |
* During the period shown in the bar chart the Pioneer Fund's highest quarterly return was 15.93% for the quarter ended June 30, 2003, and the lowest quarterly return was -22.31% for the quarter ended September 30, 1998.
AmSouth Value Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund, Class A Shares(1)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 8.78% 1.02% 9.62%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 8.52% -0.30% 7.60%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 5.70% 0.39% 7.57%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund, Class B Shares(1)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 9.27% 1.09% 9.65%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Value Fund, Class I Shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 15.31% 2.29% 10.37%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 14.97% 0.91% 8.28%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 9.93% 1.44% 8.22%
---------------------------------------------------------------------------------------------------------------------------------
S&P 500/Barra Value Index(3) 15.71% 2.48% 12.24%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 12/1/88. Performance for the Class B shares, which were first offered on 9/3/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the contingent deferred sales charge.
(2) Performance for the Class I shares, which were first offered on 9/2/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date.
(3) The S&P 500/Barra Value Index, an unmanaged market capitalization weighted index comprised of a subset of the S&P 500 with low price to book ratios relative to the S&P 500 as a whole, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Value Fund's returns. After-tax returns are only shown for Class A and Class I shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from
those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Value Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years 10 Years Since Inception
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Value Fund, Class A shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 5.78% 4.42% 8.34% 12.49% (9/30/69)
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 3.19% 2.68% 6.33% 9.52%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund 6.13% 3.16% 6.39% 9.46%
Shares(1)
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Value Fund, Class B shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 7.45% 4.44% N/A 5.59% (7/1/96)
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Value Fund, Class Y shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 12.47% 5.70% 9.00% 12.69% (9/30/69)(3)
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 9.64% 3.92% 6.97% 9.71%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund 10.62% 4.26% 6.98% 9.65%
Shares(1)
---------------------------------------------------------------------------------------------------------------------------------
Russell 1000 Value Index(2) 16.49% 5.27% 13.83% 14.60%(4)
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown, and the after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
(2) The Russell 1000 Value Index, an unmanaged index of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth ratios, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
(3) Reflects the inception date of the Fund's Class A shares. The inception date of the Fund's Class Y shares was August 10, 2004.
(4) Reflects the return of the index since the inception of the Russell 1000 Value Index (December 31, 1978). The return of the index since the inception of Class B shares is 11.15%.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Value Fund, the expenses of AmSouth Value Fund for the period ended January 31, 2005 and (ii) for Pioneer Value Fund, the expenses of Pioneer Value Fund for the period ended March 31, 2005. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on March 31, 2005.
---------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Combined AmSouth Pioneer Combined
transaction Value Fund(1) Value Fund Fund (Pro Value Value Fund Fund (Pro Value Value Fund Fund (Pro
fees (paid Forma) Fund(1) Forma) Fund(1) Forma)
directly from
your
investment) Class A Class A Class A Class B Class B Class B Class I Class Y Class Y
---------------------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75%(2) 5.75%(2) None None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
---------------------------------------------------------------------------------------------------------------------------------
Maximum None None None 5.00%(3) 4.00% 4.00% None None None
deferred sales
charge (load)
as a
percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
---------------------------------------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None 2.00%(4) None None 2.00%(4) None None
fees
---------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
---------------------------------------------------------------------------------------------------------------------------------
Management fee 0.80% 0.60%(6) 0.60%(6) 0.80% 0.60%(6) 0.60%(6) 0.80% 0.60%(6) 0.60%(6)
---------------------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.75% 1.00% 1.00% None None None
and service
(12b-1) fee
---------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.56%(5) 0.15% 0.15% 0.58%(5) 0.28% 0.28% 0.46%(5) 0.01% 0.02%
---------------------------------------------------------------------------------------------------------------------------------
Total fund 1.36% 1.00%(7) 1.00% 2.13% 1.88%(7) 1.88% 1.26% 0.61%(7) 0.62%
operating
expenses
---------------------------------------------------------------------------------------------------------------------------------
Expense 0.04% N/A N/A 0.06% N/A N/A 0.09% N/A N/A
reimbursement/
reduction
---------------------------------------------------------------------------------------------------------------------------------
Net fund 1.32% 1.00% 1.00% 2.07% 1.88% 1.88% 1.17% 0.61% 0.62%
operating
expenses
---------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%,
3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.52% for Class A shares, 0.52% for Class B shares and 0.37% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) Pioneer Value Fund pays a management fee that ranges from 0.50% to 0.70% of average daily net assets based on its performance. The Fund's basic fee before any performance adjustment is 0.60% of average daily net assets, which fee is reduced at asset levels above $5 billion.
(7) Pioneer Value Fund's total annual operating expenses have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------------------------
Number of years you AmSouth Value Fund Pioneer Value Fund Combined Fund
own your shares (Pro Forma)
------------------------------------------------------------------------------------------------------------
Class A
------------------------------------------------------------------------------------------------------------
Year 1 $681 $671 $671
------------------------------------------------------------------------------------------------------------
Year 3 $957 $875 $875
------------------------------------------------------------------------------------------------------------
Year 5 $1,254 $1,096 $1,096
------------------------------------------------------------------------------------------------------------
Year 10 $2.095 $1,729 $1,729
------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
------------------------------------------------------------------------------------------------------------
Year 1 $716 $591 $591
------------------------------------------------------------------------------------------------------------
Year 3 $967 $891 $891
------------------------------------------------------------------------------------------------------------
Year 5 $1,344 $1,116 $1,116
------------------------------------------------------------------------------------------------------------
Year 10 $2,266 $1,971 $1,971
------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
------------------------------------------------------------------------------------------------------------
Year 1 $216 $191 $191
------------------------------------------------------------------------------------------------------------
Year 3 $667 $591 $591
------------------------------------------------------------------------------------------------------------
Year 5 $1,144 $1,016 $1,016
------------------------------------------------------------------------------------------------------------
Year 10 $2,266 $1,971 $1,971
------------------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------------------
Year 1 $128 $63 $63
------------------------------------------------------------------------------------------------------------
Year 3 $400 $199 $199
------------------------------------------------------------------------------------------------------------
Year 5 $692 $346 $346
------------------------------------------------------------------------------------------------------------
Year 10 $1,523 $774 $774
------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Value Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment
adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, after the Reorganization, the combined Fund will have an asset size substantially larger than that of your AmSouth Fund, which may allow the combined Fund to achieve significant economies of scale in investments or expenses.
Third, the historical investment performance of Pioneer Value Fund is comparable to your AmSouth Fund's investment performance. For the one, five and ten year periods ended December 31, 2004, Class A shares of Pioneer Value Fund had an average annual return of 5.78% (one year); 4.42% (five year); and 8.34% (ten year), compared to an average annual return of the Class A shares of your AmSouth Fund of 8.78% (one year); 1.02% (five year); and 9.62% (ten year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Fourth, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fifth, Pioneer Value Fund's management fee (0.60% of average daily net assets as of as of March 31, 2005) is substantially lower than the advisory fees of your Fund (0.80% of average daily net assets). The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. Pioneer Value Fund's expenses are lower than your Fund's expenses on both a gross and net basis. On a pro forma basis, after giving effect to the Reorganization, it is estimated that the Pioneer Value Fund's expenses will also be lower than you Fund's expenses on a gross and net basis. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Sixth, the substantially larger size of the combined Pioneer Value Fund will offer greater opportunity for diversification of the investment portfolio, which should help to reduce risks.
Seventh, the Class A, B and Y shares of Pioneer Value Fund received in the Reorganization will provide AmSouth Value Fund shareholders with exposure to substantially the same investment product as they currently have.
Eighth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares. Although the Reorganization will result in a per share decrease in capital loss carryforwards, the potential negative tax consequences of this aspect of the Reorganization are outweighed by the advantages of the Reorganization.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
-----------------------------------------------------------------------------------------------------------------------
Pioneer Value Pro Forma Pioneer
AmSouth Value Fund Fund Value Fund
May 31, 2005 May 31, 2005 May 31, 2005
-----------------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $481,874 $3,992,881 $4,474,755
-----------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $132,299 $3,817,843 $3,950,143
-----------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $27,013 $27,494 $54,507
-----------------------------------------------------------------------------------------------------------------------
Class I /Y shares ................................ $322,562 $12,907 $335,469
-----------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
-----------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $16.75 $17.63 $17.63
-----------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $16.40 $16.55 $16.55
-----------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $16.72 $17.68 $17.68
-----------------------------------------------------------------------------------------------------------------------
Shares Outstanding
-----------------------------------------------------------------------------------------------------------------------
Class A shares ................................... 7,896,883 216,506,470 244,009,051
-----------------------------------------------------------------------------------------------------------------------
Class B shares ................................... 1,647,053 1,661,225 3,293,388
-----------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. 19,287,248 730,157 18,977,538
-----------------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Mid Cap Fund and Pioneer Mid Cap Value Fund
PROPOSAL 1(e)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests primarily in equity securities of mid capitalization issuers and, consequently, has similar investment policies and risks. Your Fund, while not a pure index fund, seeks to track closely the S&P MidCap 400 Index, while the Pioneer Fund is actively managed and does not have a goal of tracking an index. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Mid Cap Fund to Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Delaware statutory
organized as a Massachusetts business trust. trust.
------------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, $228.9 million $2,362.1 million
2005
------------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Investment Subadviser: Portfolio Managers:
OakBrook Investments, LLC ("OakBrook") Day-to-day management of the Fund's portfolio
is the responsibility of J. Rodman Wright,
Portfolio Managers: portfolio manager, and Sean Gavin, assistant
Day-to-day management of AmSouth Mid Cap portfolio manager. Mr. Wright is a senior
Fund's portfolio is the responsibility of a vice president of Pioneer. He joined Pioneer
team of investment professionals, all of whom in 1994 as an analyst and has been an
take part in the decision making process. Dr. investment professional since 1988. Mr. Gavin
Neil Wright, Ms. Janna Sampson and Dr. Peter is a vice president and joined Pioneer in
Jankovskis are the team members and have been 2002 as an assistant portfolio manager. Prior
the portfolio managers of the Fund since June to joining Pioneer, Mr. Gavin was employed as
2002. Each of the portfolio managers has been an analyst at Boston Partners from 2000 to
with OakBrook since 1998. 2002 and at Delphi Management from 1998 to
2000.
Dr. Wright is OakBrook's President and Chief
Investment Officer. From 1993 to 1997, Dr.
Wright was the Chief Investment Officer of
ANB Investment Management & Trust Co.
("ANB").
Ms. Sampson is OakBrook's Director of
Portfolio Management. From 1993 to 1997, she
was Senior Portfolio Manager for ANB.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
Dr. Jankovskis is OakBrook's Director of
Research. From 1992 to 1996, he was an
Investment Strategist for ANB and from 1996
to 1997 he was the Manager of Research for
ANB.
------------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Mid Cap Fund seeks to provide Pioneer Mid Cap Value Fund seeks capital
investors with capital appreciation. appreciation by investing in a diversified
portfolio of securities consisting primarily
of common stocks.
------------------------------------------------------------------------------------------------------------------------------------
Primary investments AmSouth Mid Cap Fund seeks to maintain risk Normally, Pioneer Mid Cap Value Fund invests
characteristics similar to those of the S&P at least 80% of its total assets in equity
MidCap 400 Index ("S&P 400") and, normally, securities of mid-size companies, that is
invests at least 80% of its net assets in companies with market values within the range
common stocks of companies comprising the S&P of market values of companies included in the
400. For the purpose of this policy, assets Russell Midcap Value Index. Pioneer Mid Cap
include net assets plus borrowings for Value Fund focuses on issuers with
investment purposes. capitalizations within the $1 billion to $10
billion range, and that range will change
The Fund overweights relative to their S&P depending on market conditions.
weights those issuers that OakBrook believes
to be undervalued compared to those in the The equity securities in which Pioneer Mid
S&P 400. As of December 31, 2004, the Cap Value Fund principally invests are common
capitalization range of issuers included in stocks, preferred stocks, depositary receipts
the S&P 400 was $309 million to $8.75 and convertible debt, but the Fund may invest
billion. in other types of equity securities to a
lesser extent, such as warrants and rights.
------------------------------------------------------------------------------------------------------------------------------------
Investment strategies OakBrook's stock selection process utilizes Pioneer uses a value approach to select
computer-aided quantitative analysis. Pioneer Mid Cap Value Fund's investments.
OakBrook's computer models use many types of Using this investment style, Pioneer seeks
data, but emphasize technical data such as securities selling at substantial discounts
price and volume information. Applying these to their underlying values and then holds
models to stocks within the S&P 400, OakBrook these securities until the market values
hopes to generate more capital growth than reflect their intrinsic values. Pioneer
that of the S&P 400. OakBrook's emphasis on evaluates a security's potential value,
technical analyses can result in significant including the attractiveness of its market
shifts in portfolio holdings at different valuation, based on the company's assets and
times. However, stringent risk controls at prospects for earnings growth. In making that
the style, industry and individual stock assessment, Pioneer employs due diligence and
levels are intended to help the Fund maintain fundamental research, an evaluation of the
risk characteristics similar to those of the issuer based on its financial statements and
S&P 400. operations, employing a bottom-up analytic
style. Pioneer relies on the knowledge,
experience and judgment of its staff who have
access to a wide variety of research. Pioneer
focuses on the quality and price of
individual issuers, not on economic sector or
market-timing strategies.
Factors Pioneer looks for in selecting
investments include:
o Favorable expected returns relative to
perceived risk
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
o Management with demonstrated ability and
commitment to the company
o Low market valuations relative to earnings
forecast, book value, cash flow and sales
o Turnaround potential for companies that
have been through difficult periods
o Estimated private market value in excess
of current stock price
o Issuer's industry has strong fundamentals,
such as increasing or sustainable demand
and barriers to entry
------------------------------------------------------------------------------------------------------------------------------------
Other investments Subject to the Fund's 80% policy described Pioneer Mid Cap Value Fund may invest up to
above, OakBrook may invest the Fund's assets 25% of its total assets in equity and debt
in companies with smaller or larger market securities of non-U.S. issuers. The Fund will
capitalizations. AmSouth Mid Cap Fund may not invest more than 5% of its total assets
invest up to 20% of its assets in securities in the securities of emerging markets
of foreign issuers traded on the New York or issuers.
American Stock Exchange or in the
over-the-counter market in the form of Pioneer Mid Cap Value Fund may invest up to
depositary receipts, such as ADRs. The Fund 20% of its total assets in debt securities of
may also invest in debt securities of corporate and government issuers. Generally
domestic issuers rated no lower than the Fund acquires debt securities that are
investment grade (Baa/BBB) by a credit rating investment grade, but the Fund may invest up
agency, or, if unrated, deemed to be of to 5% of its net assets in below investment
comparable quality by AAMI. grade convertible debt securities issued by
both U.S. and non-U.S. issuers. The Fund
invests in debt securities when Pioneer
believes they are consistent with the Fund's
investment objective by offering the
potential for capital appreciation, to
diversify the Fund's portfolio or for greater
liquidity.
------------------------------------------------------------------------------------------------------------------------------------
Temporary defensive strategies If deemed appropriate under the Pioneer Mid Cap Value Fund may invest all or
circumstances, AmSouth Mid Cap Fund may part of its assets in securities with
increase its holdings in short-term money remaining maturities of less than one year,
market instruments to over 20% of total cash equivalents or may hold cash.
assets. AmSouth Mid Cap Fund may hold
uninvested cash pending investment.
------------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is diversified for the purpose of the Investment Company Act and is subject to
diversification requirements under the Internal Revenue Code of 1986, as amended (the "Code").
------------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Mid Cap Fund may not purchase any Pioneer Mid Cap Value Fund may not invest
securities which would cause more than 25% of more than 25% of its assets in any one
the value of the Fund's total assets at the industry.
time of purchase to be invested in securities
of one or more issuers conducting their
principal business activities in the same
industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
secured by obligations of the U.S. government
or its instrumentalities; (b) wholly owned
finance companies will be considered to be in
the industries of their parents if their
activities are primarily related to financing
the activities of their parents; and (c)
utilities will be divided according to their
services. For example, gas, gas transmission,
electric and gas, electric, and telephone
will each be considered a separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental
user.
------------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Mid Cap Fund may not invest more than Pioneer Mid Cap Value Fund may not invest
securities 15% of its net assets in securities that are more than 15% of its net assets in securities
restricted as to resale, or for which no that are illiquid and other securities that
readily available market exists, including are not readily marketable. Repurchase
repurchase agreements providing for agreements maturing in more than seven days
settlement more than seven days after notice. will be included for purposes of the
foregoing limit.
------------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Mid Cap Fund may not borrow money or Pioneer Mid Cap Value Fund may not borrow
issue senior securities, except that the Fund money, except the Fund may: (a) borrow from
may borrow from banks or enter into reverse banks or through reverse repurchase
repurchase agreements for temporary emergency agreements in an amount up to 33 1/3% of the
purposes in amounts up to 33 1/3% of the Fund's total assets (including the amount
value of its total assets at the time of such borrowed); (b) borrow up to an additional 5%
borrowing. The Fund will not purchase of the Fund's assets for temporary purposes;
securities while borrowings (including (c) obtain such short-term credits as are
reverse repurchase agreements) in excess of necessary for the clearance of portfolio
5% of its total assets are outstanding. In transactions; (d) purchase securities on
addition, the Fund is permitted to margin to the extent permitted by applicable
participate in a credit facility whereby the law; and (e) engage in transactions in
Fund may directly lend to and borrow money mortgage dollar rolls that are accounted for
from other AmSouth funds for temporary as financings.
purposes, provided that the loans are made in
accordance with an order of exemption from
the SEC and any conditions thereto.
------------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Mid Cap Fund may not make loans, Pioneer Mid Cap Value Fund may not make
except that the Fund may purchase or hold loans, except that the Fund may (i) lend
debt instruments in accordance with its portfolio securities in accordance with the
investment objective and policies, lend Fund Fund's investment policies, (ii) enter into
securities in accordance with its investment repurchase agreements, (iii) purchase all or
objective and policies and enter into a portion of an issue of publicly distributed
repurchase agreements. In addition, the Fund debt securities, bank loan participation
is permitted to participate in a credit interests, bank certificates of deposit,
facility whereby the Fund may directly lend bankers' acceptances, debentures or other
to and borrow money from other AmSouth funds securities, whether or not the purchase is
for temporary purposes, provided that the made upon the original issuance of the
loans are made in accordance with an order of securities, (iv) participate in a credit
exemption from the SEC and facility whereby the
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
any conditions thereto. Fund may directly lend to and borrow money
from other affiliated funds to the extent
permitted under the Investment Company Act or
an exemption therefrom, and (v) make loans in
any other manner consistent with applicable
law, as amended and interpreted or modified
from time to time by any regulatory authority
having jurisdiction.
------------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Mid Cap Fund may invest in futures Pioneer Mid Cap Value Fund may use futures
contracts and options thereon (interest rate and options on securities, indices and
futures contracts or index futures contracts, currencies, forward currency exchange
as applicable) to commit funds awaiting contracts and other derivatives. The Fund
investment, to maintain cash liquidity or for does not use derivatives as a primary
other hedging purposes. The value of the investment technique and generally limits
Fund's contracts may equal or exceed 100% of their use to hedging. However, the Fund may
the Fund's total assets, although the Fund use derivatives for a variety of
will not purchase or sell a futures contract non-principal purposes, including:
unless immediately afterwards the aggregate
amount of margin deposits on its existing o As a hedge against adverse changes in
futures positions plus the amount of premiums stock market prices, interest rates or
paid for related futures options entered into currency exchange rates
for other than bona fide hedging purposes is o As a substitute for purchasing or selling
5% or less of its net assets. securities
o To increase the Fund's return as a
non-hedging strategy that may be
considered speculative
------------------------------------------------------------------------------------------------------------------------------------
Short-term trading AmSouth Mid Cap Fund may engage in the Pioneer Mid Cap Value Fund does not usually
technique of short-term trading. Such trading trade for short-term profits. The Fund will
involves the selling of securities held for a sell an investment, however, even if it has
short-time, ranging from several months to only been held for a short time, if it no
less than a day. The object of such longer meets the Fund's investment criteria.
short-term trading is to increase the
potential for capital appreciation and/or
income of the Fund in order to take advantage
of what OakBrook believes are changes in
market, industry or individual company
outlook.
------------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 Fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may Funds Distributor, Inc. ("PFD"), the Fund's
be charged a contingent deferred sales charge distributor, of up to 5% declining as the
("CDSC") of size
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
1.00% if sold within one year of purchase. of your investment increases.
Class A shares pay a shareholder servicing There is no CDSC, except in certain
fee (non 12b-1) of up to 0.25% of average circumstances when the initial sales charge
daily net assets. is waived.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a contingent sales charge, but are subject to a CDSC of up
deferred sales charge of up to 5%. For Class to 4% if you sell your shares. The charge is
B shares purchased prior to the combination reduced over time and is not charged after
of AmSouth Funds with ISG Funds, the CDSC on five years. Your investment firm may receive
such Class B shares held continuously a commission from PFD, the Fund's
declines over six years, starting with year distributor, at the time of your purchase of
one and ending in year seven from: 4%, 3%, up to 4%.
3%, 2%, 2%, 1%. For all other Class B shares
held continuously, the CDSC declines over six Class B shares are subject to distribution
years, starting with year one and ending in and service (12b-1) fees of up to 1% of
year seven from: 5%, 4%, 3%, 3%, 2%, 1%. average daily net assets.
Eight years after purchase (seven years in
the case of shares acquired in the ISG Maximum purchase of Class B shares in a
combination), Class B shares automatically single transaction is $49,999.
convert to Class A shares.
Class B shares acquired through the
Class B shares pay a shareholder servicing Reorganization will be subject to the CDSC
fee (non 12b-1) of up to 0.25% of average and commission schedules applicable to the
daily net assets and a distribution (12b-1) original purchase.
fee of 0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y sales AmSouth Mid Cap Fund does not CDSC deferred The Fund does not impose any initial,
charges and Rule 12b-1 fees sales charge on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth Mid Cap Fund pays an advisory fee on Pioneer Mid Cap Value Fund pays Pioneer an
a monthly basis at an annual rate of 0.90% of annual basic fee, subject to a performance
the Fund's average daily net assets. adjustment, equal to 0.70% of the Fund's
average daily net assets up to $500 million,
ASO Services Company, Inc. ("ASO") serves as 0.65% on the next $500 million, 0.625% on the
administrator and fund accounting agent for next $3 billion, and 0.60% on the excess over
the Fund. The Fund pays ASO an administrative $4 billion.
services fee of 0.15% of the
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
Fund's average daily net assets. Pioneer's fee can increase or decrease by a
maximum of 0.10%, depending on the
Other expenses of the Fund are being limited performance of the Fund's Class A shares
to 0.20% for Class A shares, 0.20% for Class relative to the Russell Midcap Value Index.
B shares, and 0.05% for Class I shares. Any The performance comparison is made for a
fee waiver or expense reimbursement rolling 36-month period. Pioneer's fee
arrangement is voluntary and may be increases or decreases depending upon whether
discontinued at any time. the Fund's performance is up and down more or
less than that of the index during the
For the fiscal year ended July 31, 2004, the rolling 36-month performance period. Each
Fund's annual operating expenses for Class A percentage point of difference between the
shares, after giving effect to the expense performance of the Class A shares and the
limitation were 1.10%, and without giving index (to a maximum of +/- 10) is multiplied
effect to the expense limitation, were 1.43% by a performance rate adjustment of 0.01%. As
of average daily net assets. a result, the maximum annualized rate
adjustment is +/- 10% for the rolling
For the fiscal year ended July 31, 2004, the 36-month performance period. This adjustment
Fund's annual operating expenses for Class B factor is applied to the average net assets
shares, after giving effect to the expense during the 36-month period. In addition, the
limitation were 1.85%, and without giving fee is further limited on an annual basis to
effect to the expense limitation, were 2.18% a maximum rate adjustment of +/-10% on
of average daily net assets. average daily net assets for the current year
(i.e., the fee is further subject to a cap of
For the fiscal year ended July 31, 2004, the average daily net assets of 0.80% and a floor
Fund's annual operating expenses for Class I of 0.50% of average daily net assets assuming
shares, after giving effect to the expense that the Fund is not large enough for any
limitation were 0.95%, and without giving breakpoints to apply). Pioneer currently is
effect to the expense limitation, were 1.33% waiving the floor on its fee. Pioneer may
of average daily net assets. reimpose the same floor in the future, but
will not be entitled to recover any
previously waived fees. Because the
adjustment to the basic fee is based on the
comparative performance of the Fund and the
performance record of the index, the
controlling factor is not whether Fund
performance is up or down, but whether it is
up or down more or less than the performance
record of the index, regardless of general
market performance. As a result, Pioneer
could earn the maximum possible fee even if
the Fund's net asset declines. Moreover, the
comparative investment performance of the
Fund is based solely on the relevant
performance period without regard to the
cumulative performance over a longer or
shorter period of time.
During its most recent fiscal year, Pioneer
Mid Cap Value Fund paid an advisory fee
equivalent to 0.74% of the average daily net
assets.
In addition, the Fund reimburses Pioneer for
certain fund accounting and legal expenses
incurred on behalf of the Fund and pays a
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
separate shareholder servicing/transfer
agency fee to PIMSS, an affiliate of Pioneer.
For the fiscal year ended October 31, 2004,
the Fund's total annual operating expenses
for Class A shares were 1.21%, Class B shares
were 2.13%, and Class Y shares were 0.78%.
The Fund does not currently have an expense
limitation for its Class A, Class B or Class
Y shares.
------------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other
financial institutions that have entered into If the account is established in the
selling agreements with the Fund's shareholder's own name, shareholders may also
distributor, as described in the Fund's purchase additional shares of the Fund by
prospectus. telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
Fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one Fund to charging you either an initial or contingent
another are taxable. Class A shares may be deferred shares charge at the time of the
exchanged for Class I shares of the same Fund exchange. Shares you acquire as part of an
or another AmSouth Fund if you become exchange will continue to be subject to any
eligible to purchase Class I shares. Class I contingent deferred sales charge that applies
shares may be exchanged for Class A shares of to the shares you originally purchased. When
the same Fund. No transaction fees are you ultimately sell your shares, the date of
currently charged for exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days purchase of shares for federal income tax
of the date of purchase, you will be charged purposes.
a 2.00% fee on the current net asset value of
the shares sold or exchanged. The fee is paid After you establish an eligible Fund account,
to the Fund to offset the costs associated you can exchange Fund shares by telephone or
with short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares
purchased first will be considered redeemed
first for purposes of determining whether the
redemption fee will be charged.
The fee will be charged on all covered
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund
------------------------------------------------------------------------------------------------------------------------------------
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan
administrator or brokerage firm to implement
the fee). The Fund will not impose the
redemption fee on a redemption or exchange of
shares purchased upon the reinvestment of
dividend and capital gain distributions.
------------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
--------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Pioneer Fund by
telephone or online.
------------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o Value or Mid-Cap stocks fall out of favor with investors
o The Fund's assets remain undervalued or do not have the potential value originally expected
Each Fund also has risks associated with investing in mid-size companies. Compared to large companies, mid-size companies, and the market for their equity securities, are likely to:
o Be more sensitive to changes in earnings results and investor expectations
o Have more limited product lines and capital resources
o Experience sharper swings in market values
o Be harder to sell at the times and prices the adviser/subadviser thinks appropriate
o Offer greater potential for gain or loss
Investing in non-U.S. issuers may involve unique risks compared to investing in securities of U.S. issuers. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the adviser/subadviser might not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
In addition, at times, more than 25% of Pioneer Mid Cap Value Fund's assets may be invested in the same market segment, such as financial or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Mid Cap Fund -- Class A Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]
2000 2001 2002 2003 2004 -14.95 -23.07 -19.73 34.27 15.83 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 17.06% for the quarter ended June 30, 2003, and the lowest quarterly return was -21.79% for the quarter ended September 30, 2001. The quoted returns reflect the performance from 5/4/99 to 3/12/00 of the ISG Mid-Cap Fund, an open-end investment company that was the predecessor fund to AmSouth Mid Cap Fund. The predecessor fund was managed using substantially the same investment objective, policies and methodologies as the AmSouth Mid Cap Fund. Class A, Class B and Class I shares were first offered on 5/4/99.
Pioneer Mid Cap Value Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 30.73 11.66 17.45 -4.71 12.6 17.64 5.56 -11.99 36.87 21.67 |
* During the period shown in the bar chart, Pioneer Mid Cap Value Fund's highest quarterly return was 17.27% for the quarter ended June 30, 2003, and the lowest quarterly return was -21.42% for the quarter ended September 30, 1998.
AmSouth Mid Cap Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
(5/4/99)
---------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund, Class A Shares(1)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 9.46% -5.05% 5.28%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 9.40% -5.06% 5.26%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 6.14% -4.23% 4.55%
---------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund, Class B Shares(1)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 10.06% -5.15% 5.35%
---------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Fund, Class I Shares(1)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 16.07% -3.90% 6.44%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 16.00% -3.93% 6.41%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 10.44% -3.29% 5.57%
---------------------------------------------------------------------------------------------------------------------------
S&P MidCap 400 Index(2) 16.48% 9.54% 10.63%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------
|
(1) The quoted returns reflect the performance from 5/4/99 to 3/12/00 of the ISG Mid-Cap Fund, an open-end investment company that was the predecessor fund to the AmSouth Mid Cap Fund. The predecessor fund was managed using substantially the same investment objective, policies and methodologies as the Fund. Class A, Class B, and Class I shares were first offered on 5/4/99.
(2) The S&P MidCap 400 Index, an unmanaged index of 400 domestic stocks, is not available for investment and does not reflect fees, brokerage commissions or other expenses of investing.
The table above shows the impact of taxes on AmSouth Mid Cap Fund's returns. After-tax returns are only shown for Class A and Class I shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual
federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Mid Cap Value Fund Average Annual Total Returns as of December 31, 2004
------------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years 10 Years Since Inception
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Mid Cap Value Fund, Class A shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 14.68% 11.40% 12.20% 13.35% (07/25/90)
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 12.51% 10.11% 10.20% 11.28%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund 11.90% 9.46% 9.74% 10.82%
Shares(1)
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Mid Cap Value Fund, Class B shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 16.55% 11.79% 11.94% 12.23% (04/04/94)
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Mid Cap Value Fund, Class Y shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 22.44% 13.30% 13.22% 14.08% (07/25/90)(1)
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 20.18% 12.00% 11.18% 11.98%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund 17.04% 11.15% 10.65% 11.49%
Shares(1)
------------------------------------------------------------------------------------------------------------------------------------
Russell Midcap Value Index(2) 23.71% 13.48% 15.72% 14.86%(3)
(reflects no deduction for fees, expenses or taxes)
------------------------------------------------------------------------------------------------------------------------------------
|
(1) Reflects the inception date of the Fund's Class A shares. Inception of Class Y shares was July 2, 1998.
(2) The Russell Midcap Value Index, an unmanaged index that measures the performance of those companies in the Russell Midcap Value Index with lower price-to-book ratios and lower forecasted growth values, is for reference only and does not mirror the Fund's investments.
(3) Reflects the return of the index since the inception of Class A shares.
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown, and the after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Mid Cap Fund, the expenses of AmSouth Mid Cap Fund for the period ended January 31, 2005, and (ii) for Pioneer Mid Cap Value Fund, the expenses of Pioneer Mid Cap Value Fund for the period ended May 31, 2005. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on May 31, 2005.
------------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Combined AmSouth Pioneer Combined
transaction Mid Cap Mid Cap Fund (Pro Mid Cap Mid Cap Fund (Pro Mid Cap Mid Cap Fund (Pro
fees (paid Fund(1) Value Fund Forma) Fund(1) Value Fund Forma) Fund(1) Value Fund Forma)
directly from
your
investment) Class A Class A Class A Class B Class B Class B Class I Class Y Class Y
------------------------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75%(2) 5.75%(2) None None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
------------------------------------------------------------------------------------------------------------------------------------
Maximum None None(6) None 5.00%(3) 4.00% 4.00% None None None
deferred sales
charge (load)
as a
percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
------------------------------------------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None 2.00%(4) None None 2.00%(4) None None
fees
------------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
------------------------------------------------------------------------------------------------------------------------------------
Management fee 0.90% 0.74%(7) 0.74% 0.90% 0.74%(7) 0.74% 0.90% 0.74%(7) 0.74%
------------------------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.75% 1.00% 1.00% None 0.00% 1.00%
and service
(12b-1) fee
------------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.67%(5) 0.20% 0.20% 0.75%(5) 0.39% 0.39% 0.53%(5) 0.04% 0.03%
------------------------------------------------------------------------------------------------------------------------------------
Total fund 1.57% 1.19%(8) 1.19% 2.40% 2.13%(8) 2.13% 1.43% 0.77%(8) 0.77%
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
Expense 0.47% N/A N/A 0.55% N/A N/A 0.48% N/A N/A
reimbursement/
reduction
------------------------------------------------------------------------------------------------------------------------------------
Net fund
operating 1.10% 1.19% 1.19% 1.85% 2.13% 2.13% 0.95% 0.77% 0.77%
expenses
------------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.20% for Class A shares, 0.20% for Class B shares and 0.05% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) Purchases of $1 million or more and purchases by participants in certain group plans are not subject to an initial sales charge but may be subject to a contingent deferred sales charge of 1%.
(7) At current asset levels, Pioneer Mid Cap Value Fund pays a management fee that ranges from 0.60% to 0.80% of average daily net assets based on its performance and the size of the Fund. The Fund's basic fee, before any performance adjustment, is 0.70% of average daily net assets, which is reduced at asset levels above $500 million.
(8) Pioneer Mid Cap Value Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------------------------
Number of years you AmSouth Mid Cap Fund Pioneer Mid Cap Value Fund Combined Fund
own your shares (Pro Forma)
------------------------------------------------------------------------------------------------------------
Class A
------------------------------------------------------------------------------------------------------------
Year 1 $701 $689 $689
------------------------------------------------------------------------------------------------------------
Year 3 $1,018 $931 $931
------------------------------------------------------------------------------------------------------------
Year 5 $1,358 $1,202 $1,192
------------------------------------------------------------------------------------------------------------
Year 10 $2,135 $1,957 $1,935
------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
------------------------------------------------------------------------------------------------------------
Year 1 $743 $616 $616
------------------------------------------------------------------------------------------------------------
Year 3 $1,048 $967 $967
------------------------------------------------------------------------------------------------------------
Year 5 $1,480 $1,244 $1,244
------------------------------------------------------------------------------------------------------------
Year 10 $2,530 $2,222 $2,222
------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
------------------------------------------------------------------------------------------------------------
Year 1 $243 $216 $79
------------------------------------------------------------------------------------------------------------
Year 3 $748 $667 $246
------------------------------------------------------------------------------------------------------------
Year 5 $1,280 $1,144 $1,144
------------------------------------------------------------------------------------------------------------
Year 10 $2,530 $2,222 $2,222
------------------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------------------
Year 1 $146 $216 $79
------------------------------------------------------------------------------------------------------------
Year 3 $452 $667 $246
------------------------------------------------------------------------------------------------------------
Year 5 $782 $1,144 $428
------------------------------------------------------------------------------------------------------------
Year 10 $1,713 $2,222 $954
------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Mid Cap Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your Amsouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, after the Reorganization, the combined Fund will have an asset size substantially larger than that of your AmSouth Fund, which may allow the combined Fund to achieve significant economies of scale in investments or expenses.
Third, the historical investment performance of Pioneer Mid Cap Value Fund is superior to your AmSouth Fund's investment performance. For the one and five year periods ended December 31, 2004, Class A shares of Pioneer Mid Cap Value Fund had an average annual return of 14.68% (one year) and 11.40% (five year), compared to an average annual return of the Class A shares of your AmSouth Fund of 9.46% (one year) and -5.05% (five year) during the same period. The Trustees also considered that, for the one and five year periods ended March 31, 2005, Class A shares of the Pioneer Fund had an average annual return of 17.73% (one year) and 12.59% (five year), compared to an average annual return of the Class A shares of your AmSouth Fund of 10.15% (one year) and -6.37% (five year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Fourth, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $26.7 billion in equity funds. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges
Fifth, Pioneer Mid Cap Value Fund's management fee (0.74% of average daily net assets) is substantially lower than the advisory fee of your Fund (0.90% of average daily net assets). The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. Currently, the Pioneer Mid Cap Value Fund's gross expense ratio is below the gross expense ratio of the corresponding class of your AmSouth Fund. However, your current expense ratio net of expense limitations is lower than the gross expense ratio of the Pioneer Fund (except for the Class Y shares of the Pioneer Fund, both the gross and net expenses of which are lower than the expenses of the Class I shares of the AmSouth Fund). On a pro forma basis, after giving effect to the Reorganization, it is estimated that the gross expenses of each class of the Pioneer Fund will be lower than the gross expenses of the corresponding class of your Fund. Although the net expenses of the Pioneer Fund's Class A and Class B shares will be higher than the net expenses of your Fund's Class A and Class B shares, your Fund's expense limitation is voluntary and may be discontinued at any time. AAMI has informed the trustees that the expense limitations will be discontinued in the future. The Trustees also noted that the Pioneer Fund is more actively managed, while the AmSouth Fund is an enhanced index fund, and index funds traditionally have substantially lower fees than actively managed funds. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Sixth, the substantially larger size of the combined Pioneer Mid Cap Value Fund will offer greater opportunity for diversification of the investment portfolio, which should help to reduced risks.
Seventh, the Class A, B and Y shares of Pioneer Mid Cap Value Fund received in the Reorganization will provide AmSouth Mid Cap Fund shareholders with exposure to substantially the same investment product as they currently have.
Eighth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares. Although the Reorganization will result in a per share increase in net unrealized capital gains and a decrease in capital loss carryforwards, the potential negative tax consequences of these aspects of the Reorganization are outweighed by the advantages of the Reorganization.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
------------------------------------------------------------------------------------------------------------------------------
AmSouth Mid Cap Pioneer Mid Cap Value Pro Forma Pioneer Mid
Fund Fund Cap Value Fund
May 31, 2005 May 31, 2005 May 31, 2005
------------------------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $234,876 $2,460,056 $2,694,932
------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $23,363 $1,911,174 $1,934,538
------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $7,918 $208,901 $216,819
------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $203,595 $114,061 $317,656
------------------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $14.24 $25.22 $25.22
------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $13.61 $22.57 $22.57
------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $14.30 $26.01 $26.01
------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding
------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... 1,641,062 75,781,678 76,708,079
------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... 581,591 9,254,911 9,605,706
------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. 14,234,921 4,385,193 12,212,598
------------------------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Small Cap Fund and Pioneer Growth Opportunities Fund
PROPOSAL 1(f)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests primarily in equity securities of smaller capitalization issuers with above-average growth potential, and, consequently, has similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Small Cap Fund to Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified series of Pioneer Series Trust
open-end management investment company II, an open-end management investment company
organized as a Massachusetts business trust. organized as a Delaware statutory trust.
------------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, 2005 $258.48 million $464.48 million
------------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Investment Subadviser: Portfolio Managers:
Sawgrass Asset Management, LLC ("Sawgrass") Day-to-day management of the Fund's portfolio
is the responsibility of co-managers Diego
Portfolio Manager: Franzin and Michael Rega. Mr. Franzin, vice
Day-to-day management of AmSouth Small Cap president and head of U.S. Quantitative
Fund is the responsibility of Dean McQuiddy, Research & Management and leader of Global
CFA, who has been the portfolio manager for Active Quantitative Equity Research, joined
the Fund since its inception. Mr. McQuiddy, Pioneer in 1998 as an active quantitative
who has been employed by Sawgrass since 1998, equity research analyst. Mr. Rega, vice
is a Principal and the Director of Equity president and senior portfolio manager,
Investing of Sawgrass. From 1983 to 1997, Mr. joined Pioneer in 2004. Prior to joining
McQuiddy was portfolio manager at Barnett Pioneer, Mr. Rega was a vice president and
Capital Advisors, Inc. Mr. McQuiddy holds portfolio manager at 646 Advisors from 2000
membership in the Association for Investment to 2004.
Management and Research. He has 20 years of
investment experience.
------------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Small Cap Fund seeks capital Pioneer Growth Opportunities Fund seeks
appreciation by investing primarily in a growth of capital.
diversified portfolio of securities
consisting of common stocks and securities
convertible into common stocks such as
convertible bonds and convertible preferred
stocks. Any current
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
income generated from these securities is
incidental.
------------------------------------------------------------------------------------------------------------------------------------
Primary investments Under normal circumstances, AmSouth Small Cap Pioneer Growth Opportunities Fund invests
Fund will invest at least 80% of its net primarily in equity securities of companies
assets in equity securities of companies with that Pioneer considers to be reasonably
small market capitalizations at the time of priced or undervalued, with above average
purchase, including common stocks and growth potential. The Fund may invest a
securities convertible into common stocks significant portion of its assets in equity
such as convertible bonds and convertible securities of small companies.
preferred stock. For the purpose of this
policy, net assets include net assets plus
borrowings for investment purposes. Small
capitalization companies are generally those
whose market capitalizations are similar to
the capitalizations at the time of purchase
of the companies in the Russell 2000 Growth
Index. As of December 31, 2004, companies in
the Russell 2000 Growth Index had market
capitalizations between $49 million and $2.9
billion.
------------------------------------------------------------------------------------------------------------------------------------
Investment strategies In managing the Fund's portfolio, Sawgrass Pioneer Growth Opportunities Fund uses a
seeks smaller companies with above-average "growth at a reasonable price" style of
growth potential. Factors Sawgrass typically management and seeks to invest in securities
considers in selecting individual securities of issuers with above average potential for
include positive changes in earnings earnings and revenue growth that are also
estimates for future growth, higher than trading at attractive market valuations. To
market average profitability, a strategic select stock, Pioneer may also use
position in a specialized market, earnings quantitative analysis. Pioneer relies on the
growth consistently above market, and knowledge, experience and judgment of its
fundamental value. staff who have access to a wide variety of
research. Pioneer focuses on the quality and
price of individual issuers, not on economic
sector or market-timing strategies. Factors
Pioneer looks for in selecting investments
include:
o Strength of the company's balance sheet
o Quality of the management team
o Rate at which the company's earnings are
projected to grow
o Whether the company's stock may be trading
at a discount relative to its industry
peers or the overall market
Pioneer generally sells a portfolio security
when it believes that the issuer no longer
offers the potential for growth at a
reasonable price or if any of the above
factors have deteriorated. Pioneer makes that
determination based upon the same criteria it
uses to select portfolio securities.
------------------------------------------------------------------------------------------------------------------------------------
Other investments AmSouth Small Cap Fund may invest up to 20% Pioneer may invest up to 20% of its total
of its assets in common stocks and securities assets in securities of non-U.S. issuers. Up
convertible into common stocks of companies to 5% of the Fund's total assets may be
with a market capitalization of invested in securities of emerging markets
issuers.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
greater than $2 billion determined at the Non-U.S. securities may be issued by non-U.S.
time of the purchase, preferred stocks, governments, banks or corporations and
corporate bonds, notes, and warrants, and certain supranational organizations, such as
short-term money market instruments. the World Bank and the European Union. The
Fund may invest in securities of Canadian
issuers to the same extent as securities of
U.S. issuers. Investing in Canadian and other
non-U.S. issuers, particularly issuers in
emerging markets, may involve unique risks
compared to investing in the securities of
U.S. issuers.
Pioneer Growth Opportunities Fund may invest
up to 20% of its total assets in debt
securities of U.S. corporate and government
issuers. Generally, the Fund acquires debt
securities that are investment grade, but the
Fund may invest up to 5% of its net assets in
below investment grade debt securities
including below investment grade convertible
debt securities. The Fund invests in debt
securities when Pioneer believes they are
consistent with the Fund's investment
objective of capital growth, to diversify the
Fund's portfolio or for greater liquidity.
------------------------------------------------------------------------------------------------------------------------------------
Temporary defensive strategies If deemed appropriate under the Pioneer Growth Opportunities Fund may invest
circumstances, AmSouth Small Cap Fund may all or part of its assets in securities with
increase its holdings in short-term money remaining maturities of less than one year,
market instruments to over 20% of total cash equivalents or may hold cash.
assets. AmSouth Small Cap Fund may hold
uninvested cash pending investment.
------------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is diversified for the purpose of the Investment Company Act and is subject to
diversification requirements under the Internal Revenue Code of 1986, as amended (the "Code").
------------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Small Cap Fund may not purchase any Pioneer Growth Opportunities Fund may not
securities which would cause more than 25% of invest more than 25% of its assets in any one
the value of the Fund's total assets at the industry.
time of purchase to be invested in securities
of one or more issuers conducting their
principal business activities in the same
industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the U.S.
government or its instrumentalities; (b)
wholly owned finance companies will be
considered to be in the industries of their
parents if their activities are primarily
related to financing the activities of their
parents; and (c) utilities will be divided
according to their services. For example,
gas, gas transmission, electric and gas,
electric, and telephone will each be
considered a separate
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
industry.
------------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Small Cap Fund may not invest more Pioneer Growth Opportunities Fund may not
securities than 15% of its net assets in securities that invest more than 15% of its net assets in
are restricted as to resale, or for which no securities that are illiquid and other
readily available market exists, including securities that are not readily marketable.
repurchase agreements providing for Repurchase agreements maturing in more than
settlement more than seven days after notice. seven days will be included for purposes of
the foregoing limit.
------------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Small Cap Fund may not borrow money Pioneer Growth Opportunities Fund may not
or issue senior securities, except that the borrow money, except the Fund may: (a) borrow
Fund may borrow from banks or enter into from banks or through reverse repurchase
reverse repurchase agreements for temporary agreements in an amount up to 33 1/3% of the
emergency purposes in amounts up to 33 1/3% Fund's total assets (including the amount
of the value of its total assets at the time borrowed); (b) borrow up to an additional 5%
of such borrowing. The Fund will not purchase of the Fund's assets for temporary purposes;
securities while borrowings (including (c) obtain such short-term credits as are
reverse repurchase agreements) in excess of necessary for the clearance of portfolio
5% of its total assets are outstanding. In transactions; (d) purchase securities on
addition, the Fund is permitted to margin to the extent permitted by applicable
participate in a credit facility whereby the law; and (e) engage in transactions in
Fund may directly lend to and borrow money mortgage dollar rolls that are accounted for
from other AmSouth funds for temporary as financings.
purposes, provided that the loans are made in
accordance with an order of exemption from
the SEC and any conditions thereto.
------------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Small Cap Fund may not make loans, Pioneer Growth Opportunities Fund may not
except that the Fund may purchase or hold make loans, except that the Fund may (i) lend
debt instruments in accordance with its portfolio securities in accordance with the
investment objective and policies, lend Fund Fund's investment policies, (ii) enter into
securities in accordance with its investment repurchase agreements, (iii) purchase all or
objective and policies and enter into a portion of an issue of publicly distributed
repurchase agreements. In addition, the Fund debt securities, bank loan participation
is permitted to participate in a credit interests, bank certificates of deposit,
facility whereby the Fund may directly lend bankers' acceptances, debentures or other
to and borrow money from other AmSouth funds securities, whether or not the purchase is
for temporary purposes, provided that the made upon the original issuance of the
loans are made in accordance with an order of securities, (iv) participate in a credit
exemption from the SEC and any conditions facility whereby the Fund may directly lend
thereto. to and borrow money from other affiliated
funds to the extent permitted under the
Investment Company Act or an exemption
therefrom, and (v) make loans in any other
manner consistent with applicable law, as
amended and interpreted or modified from time
to time by any regulatory authority having
jurisdiction.
------------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Small Cap Fund may invest in futures Pioneer Growth Opportunities Fund may use
contracts and options thereon (interest rate futures and options on securities, indices
futures contracts or index futures contracts, and currencies, forward currency exchange
as applicable) to commit funds awaiting contracts and other derivatives. The Fund
investment, to maintain cash liquidity or for does not use derivatives as a primary
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
other hedging purposes. The value of the investment technique and generally limits
Fund's contracts may equal or exceed 100% of their use to hedging. However, the Fund may
the Fund's total assets, although the Fund use derivatives for a variety of
will not purchase or sell a futures contract non-principal purposes, including:
unless immediately afterwards the aggregate
amount of margin deposits on its existing o As a hedge against adverse changes in
futures positions plus the amount of premiums stock market prices, interest rates or
paid for related futures options entered into currency exchange rates
for other than bona fide hedging purposes is
5% or less of its net assets. o As a substitute for purchasing or selling
securities
o To increase the Fund's return as a
non-hedging strategy that may be
considered speculative
------------------------------------------------------------------------------------------------------------------------------------
Short-term trading AmSouth Small Cap Fund may engage in the Pioneer Growth Opportunities Fund does not
technique of short-term trading. Such trading usually trade for short-term profits. The
involves the selling of securities held for a Fund will sell an investment, however, even
short-time, ranging from several months to if it has only been held for a short time, if
less than a day. The object of such it no longer meets the Fund's investment
short-term trading is to increase the criteria.
potential for capital appreciation and/or
income of the Fund in order to take advantage
of what Sawgrass believes are changes in
market, industry or individual company
outlook.
------------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 Fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may Funds Distributor, Inc. ("PFD"), the Fund's
be charged a contingent deferred sales charge distributor, of up to 5% declining as the
("CDSC") of 1.00% if sold within one year of size of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing circumstances when the initial sales charge
fee (non 12b-1) of up to 0.25% of average is waived.
daily net assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Class B sales charges Class B shares are offered without an initial Class B shares are offered without an initial
and Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
five
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
Funds, the CDSC on such Class B shares held years. Your investment firm may receive a
continuously declines over six years, commission from PFD, the Fund's distributor,
starting with year one and ending in year at the time of your purchase of up to 4%.
seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all
other Class B shares held continuously, the Class B shares are subject to distribution
CDSC declines over six years, starting with and service (12b-1) fees of up to 1% of
year one and ending in year seven from: 5%, average daily net assets.
4%, 3%, 3%, 2%, 1%. Eight years after
purchase (seven years in the case of shares Maximum purchase of Class B shares in a
acquired in the ISG combination), Class B single transaction is $49,999.
shares automatically convert to Class A
shares. Class B shares acquired through the
Reorganization will be subject to the CDSC
Class B shares pay a shareholder servicing and commission schedules applicable to the
fee (non 12-b-1) of up to 0.25% of average original purchase.
daily net assets and a distribution (12b-1)
fee of 0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y sales AmSouth Small Cap Fund does not impose any The Fund does not impose any initial,
charges and Rule 12b-1 fees initial or CDSC on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth Small Cap Fund pays an advisory fee Pioneer Growth Opportunities Fund pays
on a monthly basis at an annual rate of 0.90% Pioneer an annual fee equal to 0.65% of the
of the Fund's average daily net assets. Fund's average daily net assets. The fee is
computed daily and paid monthly.
ASO Services Company, Inc. ("ASO") serves as
administrator and fund accounting agent for In addition, the Fund reimburses Pioneer for
the Fund. The Fund pays ASO an administrative certain fund accounting and legal expenses
services fee of 0.15% of the Fund's average incurred on behalf of the Fund and pays a
daily net assets. separate shareholder servicing/transfer
agency fee to PIMSS, an affiliate of Pioneer.
Other expenses of the Fund are being limited
to 0.39% for Class A shares, 0.38% for Class Through May 1, 2006, Pioneer has
B shares, and 0.24% for Class I shares. Any contractually agreed to not to impose all or
fee waiver or expense reimbursement a portion of its management fee and, if
arrangement is voluntary and may be necessary, to limit other ordinary operating
discontinued at any time. expenses to 1.30% of the average daily net
assets attributable to Class A shares. The
For the fiscal year ended July 31, 2004, the portion of Fund expenses (including the
Fund's annual operating expenses for Class A amount of the management fee waived)
shares, after giving effect to the expense attributable to Class B and Class Y shares
limitation were 1.29%, and without giving will be reduced only to the extent such
effect to the expense limitation, were 1.41% expenses are reduced for Class A shares.
of average daily net assets.
For the fiscal year ended December 31, 2004,
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
For the fiscal year ended July 31, 2004, the the Fund's total annual operating expenses
Fund's annual operating expenses for Class B for Class A shares, after giving effect to
shares, after giving effect to the expense the expense limitation, were 1.31%, and
limitation were 2.03%, and without giving without giving effect to the expense
effect to the expense limitation, were 2.15% limitation were 2.29% of average daily net
of average daily net assets. assets. The expense limitation applicable to
Class A shares was not in effect for the
For the fiscal year ended July 31, 2004, the entire fiscal year ended December 31, 2004.
Fund's annual operating expenses for Class I
shares, after giving effect to the expense For the fiscal year ended December 31, 2004,
limitation were 1.14%, and without giving the Fund's total annual operating expenses
effect to the expense limitation, were 1.31% for Class B shares, after giving effect to
of average daily net assets. the expense limitation, were 2.08%, and
without giving effect to the expense
limitation were 2.33% of average daily net
assets. The expense limitation applicable to
Class B shares was not in effect for the
entire fiscal year ended December 31, 2004.
Class Y shares of Pioneer Growth
Opportunities Fund are being offered for the
first time in connection with the
Reorganization.
------------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other
financial institutions that have entered into If the account is established in the
selling agreements with the Fund's shareholder's own name, shareholders may also
distributor, as described in the Fund's purchase additional shares of the Fund by
prospectus. telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
Fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one Fund to charging you either an initial or contingent
another are taxable. Class A shares may be deferred shares charge at the time of the
exchanged for Class I shares of the same Fund exchange. Shares you acquire as part of an
or another AmSouth Fund if you become exchange will continue to be subject to any
eligible to purchase Class I shares. Class I contingent deferred sales charge that applies
shares may be exchanged for Class A shares of to the shares you originally purchased. When
the same Fund. No transaction fees are you ultimately sell your shares, the date of
currently charged for exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 30 days purchase of shares for federal income tax
of the date of purchase, you will be charged purposes.
a 2.00% fee on the current net asset value of
the shares sold or exchanged. The fee After you establish an eligible Fund account,
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund Pioneer Growth Opportunities Fund
------------------------------------------------------------------------------------------------------------------------------------
is paid to the Fund to offset the costs you can exchange Fund shares by telephone or
associated with short-term trading, such as online.
portfolio transaction and administrative
costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares
purchased first will be considered redeemed
first for purposes of determining whether the
redemption fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan
administrator or brokerage firm to implement
the fee). The Fund will not impose the
redemption fee on a redemption or exchange of
shares purchased upon the reinvestment of
dividend and capital gain distributions.
------------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
--------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Pioneer Fund by
telephone or online.
------------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down
o Small company or growth stocks fall out of favor with investors
o The adviser's/subadviser's judgment about the attractiveness, growth potential or potential appreciation of a particular stock proves incorrect
Each Fund also has risks associated with investing in small companies. Compared to large companies, small companies, and the market for their equity securities, are likely to:
o Be more sensitive to changes in the economy, earnings results and investor expectations
o Have more limited product lines and capital resources
o Experience sharper swings in market values
o Be harder to sell at the times and prices the adviser or subadviser thinks appropriate
o Offer greater potential for gain or loss
Investing in non-U.S. issuers may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Fund invests in issuers in countries with emerging markets or if the Fund invests significantly in one country. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the adviser/subadviser might not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
In addition, at times, more than 25% of Pioneer Growth Opportunities Fund's assets may be invested in the same market segment, such as financial or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Small Cap Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]]
1999 2000 2001 2002 2003 2004 15.97 18.68 -27.81 -26.75 34.42 13.89 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 27.37% for the quarter ended December 31, 1999, and the lowest quarterly return was -20.17% for the quarter ended September 30, 2001.
Pioneer Growth Opportunities Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]]
1997 1998 1999 2000 2001 2002 2003 2004 49.61 4.47 2.43 -4.52 21.66 -37.05 43.67 22.23 |
* During the period shown in the bar chart, Pioneer Growth Opportunities Fund's highest quarterly return was 34.38% for the quarter ended June 30, 2001, and the lowest quarterly return was -26.86% for the quarter ended September 30, 2002.
Pursuant to an agreement and plan of reorganization, Pioneer Growth Opportunities Fund's Investor Class acquired all of the assets and those liabilities reflected in the net assets of Safeco Growth Opportunities Fund (the predecessor fund) on December 10, 2004. In the reorganization, the predecessor fund exchanged all of its assets for Investor Class shares of the Fund. The predecessor fund offered an Investor Class and other classes of shares similar to the Fund's Class A, B and C shares. As a result of the reorganization, Pioneer Growth Opportunities Fund is the accounting successor of the predecessor fund. The predecessor fund operated as a registered investment company like the Fund. The performance of each class of the Fund includes the performance of the predecessor fund's Class A and Class B shares prior to the reorganization, which has been restated to reflect differences in any applicable sales charges (but not differences in expenses). If all the expenses of Pioneer Growth Opportunities Fund were reflected, the performance would be lower. Since August 2, 2004 and prior to the reorganization, Pioneer served as the predecessor fund's investment adviser. Previously, Safeco Asset Management Company served as the predecessor fund's investment adviser. The Fund's Investor Class shares are not offered in the Reorganization.
AmSouth Small Cap Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception (3/2/98)
---------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund, Class A Shares(1)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 7.65% -1.91% -0.12%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on 7.65% -2.59% -0.63%
Distributions
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on 4.97% -1.96% -0.37%
Distributions and Sale of
Fund Shares
---------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund, Class B Shares(1)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 8.02% -1.89% -0.09%
---------------------------------------------------------------------------------------------------------------------------
AmSouth Small Cap Fund, Class I Shares(1)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 13.95% -0.65% 0.85%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on 13.95% -1.34% 0.34%
Distributions
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on 9.06% -0.91% 0.46%
Distributions and Sale of
Fund Shares
---------------------------------------------------------------------------------------------------------------------------
Russell 2000 Growth Index(2) 14.31% -3.57% 1.77%
(reflects no deduction for
fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------
|
(1) Class A, B and I shares were first offered on 3/2/98.
(2) Russell 2000 Growth Index, an unmanaged index of common stocks of small- to mid-sized companies, is not available for investment and does not reflect fees, brokerage commissions or other expenses of investing.
The table above shows the impact of taxes on AmSouth Small Cap Fund's returns. After-tax returns are only shown for Class A and Class I shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Growth Opportunities Fund Average Annual Total Returns as of December 31, 2004
------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
------------------------------------------------------------------------------------------------------------------------------
Pioneer Growth Opportunities Fund, Class A shares(1)
------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 15.19% 3.88% 11.76% (9/30/96)
------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 15.19% 3.88% 10.56%
------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund 9.87% 3.34% 9.67%
Shares(1)
------------------------------------------------------------------------------------------------------------------------------
Pioneer Growth Opportunities Fund, Class B shares(1)
------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 17.21% 4.36% 11.67% (9/30/96)
------------------------------------------------------------------------------------------------------------------------------
Pioneer Growth Opportunities Fund, Class Y shares(2)
------------------------------------------------------------------------------------------------------------------------------
Russell 2000 Stock Index(3) 18.33% 6.61% 9.38%(4)
(reflects no deduction for fees, expenses or taxes)
------------------------------------------------------------------------------------------------------------------------------
|
(1) Reflects the inception date of the predecessor fund. Inception of Class A and Class B shares was December 13, 2004.
(2) Class Y shares were not outstanding prior to the closing of the Reorganization and consequently have no performance history. However, the performance record of the Class Y shares would be modestly higher than the performance of the Class A and Class B shares due to the lower expenses applicable to Class Y shares.
(3) The Russell 2000 Stock Index measures, an unmanaged index of U.S. small cap stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
(4) Reflects the return of the index since the inception of Class A and Class B shares.
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown, and the after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Small Cap Fund, the expenses of AmSouth Small Cap Fund for the period ended January 31, 2005, and (ii) for Pioneer Growth Opportunities Fund, the expenses of Pioneer Growth Opportunities Fund for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004.
---------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Combined AmSouth Combined
transaction Small Cap Growth Fund (Pro Small Cap Growth Fund (Pro Small Cap Fund (Pro
fees (paid Fund(1) Opportunities Forma) Fund(1) Opportunities Forma) Fund(1) Forma)
directly from Fund Fund
your
investment) Class A Class A Class A Class B Class B Class B Class I Class Y(10)
---------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75% 5.75% None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
---------------------------------------------------------------------------------------------------------------------
Maximum None None(6) None 5.00%(3) 4.00% 4.00% None None
deferred sales
charge (load)
as a
percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
---------------------------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None 2.00%(4) None None 2.00%(4) None
fees
---------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
---------------------------------------------------------------------------------------------------------------------
Management fee 0.90% 0.65% 0.65% 0.90% 0.65% 0.65% 0.90% 0.65%
---------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.75% 1.00% 1.00% None None
and service
(12b-1) fee
---------------------------------------------------------------------------------------------------------------------
Other expenses 0.85%(5) 1.39%(7) 0.52% 1.11%(5) 0.68%(7) 0.48% 0.64%(5) 0.25%
---------------------------------------------------------------------------------------------------------------------
Total fund 1.75% 2.29%(8) 1.27% 2.76% 2.33%(8) 2.08% 1.54% 0.75%
operating
expenses
---------------------------------------------------------------------------------------------------------------------
Expense 0.28% 0.99%(9) N/A 0.54% 0.99%(9) N/A 0.22% N/A
reimbursement/
reduction
---------------------------------------------------------------------------------------------------------------------
Net fund 1.47% 1.30% 1.27% 2.22% 1.34% 2.08% 1.32% 0.75%
operating
expenses
---------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 30 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.57% for Class A shares, 0.57% for Class B shares and 0.42% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) Purchases of $1 million or more and purchases by participants in certain group plans are not subject to an initial sales charge but may be subject to a contingent deferred sales charge of 1%.
(7) Other expenses are based on estimated amounts for the current fiscal year.
(8) Pioneer Growth Opportunities Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(9) The expenses in the table above reflect the expense limitation in effect through May 1, 2006 under which Pioneer has contractually agreed not to impose all or a portion of its management fee and, if necessary, to limit other ordinary operating expenses to the extent required to reduce Class A expenses to 1.30% of the average daily net assets attributable to Class A shares; the portion of Fund expenses (including the amount of the management fee waived) attributable to Class B and Class Y shares will be reduced only to the extent such expenses are reduced for Class A shares. There can be no assurance that Pioneer will extend the expense limitation beyond May 1, 2006.
(10) Class Y shares of Pioneer Growth Opportunities Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------------------------
Number of years you AmSouth Small Cap Fund Pioneer Growth Opportunities Combined Fund
own your shares Fund (Pro Forma)
------------------------------------------------------------------------------------------------------------
Class A
------------------------------------------------------------------------------------------------------------
Year 1 $718 $700 $696
------------------------------------------------------------------------------------------------------------
Year 3 $1,071 $1,160 $953
------------------------------------------------------------------------------------------------------------
Year 5 $1,447 $1,645 $1,229
------------------------------------------------------------------------------------------------------------
Year 10 $2,499 $2,977 $2,015
------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
------------------------------------------------------------------------------------------------------------
Year 1 $779 $536 $611
------------------------------------------------------------------------------------------------------------
Year 3 $1,156 $932 $952
------------------------------------------------------------------------------------------------------------
Year 5 $1,659 $1,255 $1,219
------------------------------------------------------------------------------------------------------------
Year 10 $2,847 $2,580 $2,203
------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
------------------------------------------------------------------------------------------------------------
Year 1 $279 $136 $211
------------------------------------------------------------------------------------------------------------
Year 3 $856 $632 $652
------------------------------------------------------------------------------------------------------------
Year 5 $1,459 $1,155 $1,119
------------------------------------------------------------------------------------------------------------
Year 10 $2,847 $2,580 $2,203
------------------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------------------
Year 1 $157 N/A $77
------------------------------------------------------------------------------------------------------------
Year 3 $486 N/A $240
------------------------------------------------------------------------------------------------------------
Year 5 $839 N/A $417
------------------------------------------------------------------------------------------------------------
Year 10 $1,834 N/A $931
------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Small Cap Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, after the Reorganization, the combined Fund will have an asset size substantially larger than that of your AmSouth Fund, which may allow the combined Fund to achieve significant economies of scale in investments or expenses.
Third, the historical investment performance of Pioneer Growth Opportunities Fund exceeds your AmSouth Fund's investment performance. For the one and five year periods ended December 31, 2004, Class A shares of Pioneer Growth Opportunities Fund had an average annual return of 15.19% (one year); and 3.88% (five year); compared to an average annual return of the Class A shares of your AmSouth Fund of 7.65% (one year); and -1.91% (five year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Fourth, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fifth, Pioneer Fund's management fee (0.65% of average daily net assets) is substantially lower than the advisory fee of your Fund (0.90% of average daily net assets). Although the historical gross expenses of Class A shares of Pioneer Growth
Opportunities Fund are higher than your Fund's historical gross expenses for Class A shares, the historical gross and net expenses for Class B shares of the Pioneer Fund, and estimated pro forma expenses of the Pioneer Fund attributable to Class A, B and Y shares after giving effect to the Reorganization on both a gross and net basis are lower than your Fund's gross and net operating expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Sixth, the substantially larger size of the combined Pioneer Growth Opportunities Fund will offer greater opportunity for diversification of the investment portfolio, which should help to reduce risks.
Seventh, the Class A, B and Y shares of Pioneer Growth Opportunities Fund received in the Reorganization will provide AmSouth Small Cap Fund shareholders with exposure to substantially the same investment product as they currently have.
Eighth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Growth Pro Forma Pioneer
AmSouth Small Cap Opportunities Growth Opportunities
Fund Fund Fund
May 31, 2005 May 31, 2005 May 31, 2005
------------------------------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $257,277 $450,076 $707,352
------------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $10,487 $31,515 $42,002
------------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $2,523 $338 $2,861
------------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $244,267 N/A $244,267
------------------------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
------------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... $9.18 $28.16 $28.16
------------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... $8.67 $26.32 $26.32
------------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $9.32 N/A $28.16
------------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding
------------------------------------------------------------------------------------------------------------------------------------
Class A shares ................................... 1,142,354 1,119,263 1,491,720
------------------------------------------------------------------------------------------------------------------------------------
Class B shares ................................... 290,839 12,846 108,684
------------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. 26,215,302 N/A 8,675,149
------------------------------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth International Equity Fund and Pioneer International Core Equity Fund
PROPOSAL 1(g)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-2, because it contains details that are not in the summary.
Each Fund invests in securities of international issuers and, consequently, each Fund has similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth International Equity Fund to Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Business A non-diversified series of AmSouth Funds, an A newly created diversified series of Pioneer
open-end management investment company series Trust IV, an open-end management
organized as a Massachusetts business trust. investment company organized as a Delaware
statutory trust.
------------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, 2005 $479.2 million None. Pioneer International Core Equity Fund
is newly created and does not expect to
commence investment operations until the
Reorganization occurs.
------------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Investment Subadviser: Portfolio Manager:
Dimensional Fund Advisors Inc. Day-to-day management of the Fund's portfolio
("Dimensional") will be the responsibility of Christopher
Smart. Mr. Smart is supported by a team of
Portfolio Manager: portfolio managers and analysts. The members
Day-to-day management of AmSouth of this team manage other Pioneer funds
International Equity Fund's portfolio is the investing primarily in international
responsibility of Karen E. Umland. Ms. Umland securities. The portfolio manager and team
joined Dimensional in 1993 and has been also may draw upon the research and
responsible for the international equity investment management expertise of the global
portfolios advised by Dimensional since 1998. research team, which provides fundamental
She coordinates the portfolio managers and research on companies and buy and sell
trading personnel that comprise the recommendations on equity securities, and
Investment Committee of Dimensional that have includes members from Pioneer's affiliate,
served as investment sub-adviser to the Pioneer Investment Management Limited. Mr.
AmSouth Fund since July 2002. The Investment Smart, senior vice president and director of
Committee meets on a regular basis and also international investments, joined Pioneer in
as needed to consider investment issues. The 1995 as director of research of Pioneer First
Investment Committee is composed of certain Investments, Moscow, Russia.
officers and directors of Dimensional who are
elected annually.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth International Equity Fund seeks to Pioneer International Core Equity Fund seeks
provide investors with capital appreciation. long-term capital growth.
------------------------------------------------------------------------------------------------------------------------------------
Primary investments Under normal circumstances, the Fund will Normally, the Fund invests at least 80% of
invest at least 80% of its net assets in its total assets in equity securities of
equity securities. For the purpose of this non-U.S. issuers.
policy, net assets include net assets plus
borrowings for investment purposes. The Fund The Fund focuses on securities of issuers
invests its assets primarily in equity located in countries with developed markets
securities of non-U.S. companies (i.e., (other than the United States) but may
incorporated or organized outside the United allocate up to 10% of its assets in countries
States). with emerging economies or securities
markets. Developed markets outside the United
The Fund seeks to achieve its objective by States generally include, but are not limited
investing in the stocks of large non-U.S. to, the countries included in the Morgan
companies that Dimensional determines to be Stanley Capital International Europe,
value stocks at the time of purchase. Australasia, Far East Index. The Fund's
Securities are considered value stocks assets must be allocated to securities of
primarily because a company's shares have a issuers located in at least three non-U.S.
high book value in relation to their market countries. For purposes of the Fund's
value (a "book to market ratio"). In investment policies, equity securities
assessing value, Dimensional may consider include common stocks, convertible debt and
additional factors such as price to cash flow other equity instruments, such as depositary
or price to earnings ratios as well as receipts, warrants, rights and preferred
economic conditions and developments in the stocks. The Fund may also purchase and sell
issuer's industry. The criteria Dimensional forward foreign currency exchange contracts
uses for assessing value are subject to in non-U.S. currencies in connection with its
change from time to time. investments.
The Fund intends to invest in the stocks of
large companies in countries with developed
markets. Under normal market conditions, the
Fund intends to invest in companies organized
or having a majority of their assets in or
deriving a majority of their operating income
in at least three non-U.S. countries, and no
more than 40% of the Fund's assets are
invested in such companies in any one
country. Dimensional determines company size
on a country or region specific basis and
based primarily on market capitalization. In
the countries or regions authorized for
investment, the subadviser first ranks
eligible companies listed on selected
exchanges based on the companies' market
capitalizations. Dimensional then determines
the universe of eligible stocks by defining
the minimum market capitalization of a large
company that may be purchased by the Fund
with respect to each country or region. As of
the date of this Proxy Statement/Prospectus,
on an aggregate basis for the Fund,
Dimensional considers large companies to be
those companies with a market capitalization
of at least $716 million. This threshold will
vary by country or region and will change
with market conditions.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Investment strategies Dimensional believes that equity investing Pioneer International Core Equity Fund uses a
should involve a long-term view and a focus "growth at a reasonable price" style of
on asset class selection, not stock picking. management. The Fund seeks to invest in
It places priority on limiting expenses, issuers with above average potential for
portfolio turnover and trading costs. earnings and revenue growth that are also
Generally, the subadviser structures a trading at attractive market valuations. To
portfolio by: 1) starting with a universe of select stocks, Pioneer employs due diligence
securities, 2) creating a sub-set of and fundamental research, an evaluation of
companies meeting the subadviser's investment the issuer based on its financial statements
guidelines, 3) excluding certain companies and operations. Pioneer relies on the
after analyzing various factors and 4) knowledge, experience and judgment of its
purchasing stocks so the portfolio is staff who have access to a wide variety of
generally market capitalization weighted research. Pioneer focuses on the quality and
within countries. price of individual issuers, not on economic
sector or market-timing strategies. Factors
The value criteria used by Dimensional, as Pioneer looks for in selecting investments
described above, generally apply at the time include:
of purchase by the Fund. The Fund is not
required to dispose of a security if the o Favorable expected returns relative to
security's issuer does not meet current value perceived risk
criteria. Similarly, Dimensional is not
required to sell a security even if the o Above average potential for earnings and
decline in the market capitalization reflects revenue growth
a serious financial difficulty or potential
or actual insolvency of the company. o Issuer's industry has strong fundamentals,
Securities which do meet the market such as increasing or sustainable demand
capitalization and/or value criteria and barriers to entry
nevertheless may be sold at any time when, in
Dimensional's judgment, circumstances warrant o Low market valuations relative to earnings
their sale. forecast, book value, cash flow and sales.
The Fund is non-diversified and, therefore, Pioneer generally sells a portfolio security
may concentrate its investments in a limited when it believes that the issuer no longer
number of issuers. offers the potential for above average
earnings and revenue growth. Pioneer makes
The Fund intends to purchase securities that determination based upon the same
within each applicable country or region criteria it uses to select portfolio
using a market capitalization weighted securities.
approach. Dimensional, using this approach
and its best judgment, will seek to set
country or region weights based on the
relative market capitalization of eligible
large companies within each country or
region. When investing on a market
capitalization weighted basis, Dimensional
will use a market capitalization weighted
approach which may include adjusting that
weighting to consider such factors as free
float, trading strategies, liquidity
management and other factors that Dimensional
determines appropriate, given market
conditions. As a result, the weighting of
certain countries in the Fund's portfolio may
vary from their weighting in international
indices such as those published by FTSE
International, Morgan Stanley Capital
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
International or Salomon/Smith Barney.
------------------------------------------------------------------------------------------------------------------------------------
Other investments The Fund is not required to invest The Fund may invest up to 20% of its total
exclusively in common stocks or other equity assets in debt securities, cash and cash
securities, and, if deemed advisable, the equivalents. The debt securities may be
Fund may invest, to a limited extent, in issued by U.S. or non-U.S. corporate and
fixed income securities and money market government issuers. Generally the Fund
instruments. The Fund will not invest in acquires debt securities that are investment
fixed income securities rated lower than A by grade, but the Fund may invest up to 5% of
a credit rating agency, such as Moody's, its net assets in below investment grade
Standard & Poor's Ratings Group or Fitch convertible debt securities.
Ratings, or, if unrated, deemed to be of
comparable quality by AAMI. Debt securities are subject to the risk of an
issuer's inability to meet principal or
interest payments on its obligations. Factors
which could contribute to a decline in the
market value of debt securities in the Fund's
portfolio include rising interest rates or a
reduction in the perceived creditworthiness
of the issuer of the securities. A debt
security is investment grade if it is rated
in one of the top four categories by a
nationally recognized statistical rating
organization or determined to be of
equivalent credit quality by Pioneer. Debt
securities rated below investment grade are
commonly referred to as "junk bonds" and are
considered speculative. Below investment
grade debt securities involve greater risk of
loss, are subject to greater price volatility
and are less liquid, especially during
periods of economic uncertainty or change,
than higher quality debt securities.
------------------------------------------------------------------------------------------------------------------------------------
Temporary defensive strategies When AAMI determines adverse market Pioneer International Core Equity Fund may
conditions exist, AmSouth International invest all or part of its assets in
Equity Fund may invest entirely in cash securities with remaining maturities of less
positions, directly in U.S. Government than one year, cash equivalents or may hold
securities and short-term paper, such as cash.
bankers' acceptances.
------------------------------------------------------------------------------------------------------------------------------------
Diversification AmSouth International Equity Fund is Pioneer International Core Equity Fund is
non-diversified for the purpose of the diversified for the purpose of the Investment
Investment Company Act and, therefore, may Company Act and is subject to diversification
concentrate its investments in a limited requirements under the Internal Revenue Code
number of issuers. of 1986, as amended (the "Code").
AmSouth International Equity Fund may not
purchase securities of any one issuer, other
than obligations issued or guaranteed by the
U.S. government or its agencies or
instrumentalities if, immediately after such
purchase, more than 5% of the value of its
total assets would be invested in such issuer
(except that up to 50% of the value of the
Fund's total assets may be invested without
regard to such 5% limitation). For purposes
of this limitation, a security is
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
considered to be issued by the government
entity (or entities) whose assets and
revenues back the security; with respect to a
private activity bond that is backed only by
the assets and revenues of a non-government
user, a security is considered to be issued
by such non-governmental user.
------------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth International Equity Fund may Pioneer International Core Equity Fund may
purchase any securities which would cause not invest more than 25% of its assets in any
more than 25% of the value of the Fund's one industry.
total assets at the time of purchase to be
invested in securities of one or more issuers
conducting their principal business
activities in the same industry, provided
that (a) there is no limitation with respect
to obligations issued or guaranteed by the
U.S. government or its agencies or
instrumentalities, and repurchase agreements
secured by obligations of the U.S. government
or its agencies or instrumentalities; (b)
wholly owned finance companies will be
considered to be in the industries of their
parents if their activities are primarily
related to financing the activities of their
parents; and (c) utilities will be divided
according to their services. For example,
gas, gas transmission, electric and gas,
electric, and telephone will each be
considered a separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental
user.
------------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth International Equity Fund may not Pioneer International Core Equity Fund may
securities invest more than 15% of its net assets in not invest more than 15% of its net assets in
securities that are restricted as to resale, securities that are illiquid and other
or for which no readily available market securities that are not readily marketable.
exists, including repurchase agreements Repurchase agreements maturing in more than
providing for settlement more than seven days seven days will be included for purposes of
after notice. the foregoing limit.
------------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth International Equity Fund may not Pioneer International Core Equity Fund may
borrow money or issue senior securities, lend portfolio securities with a value that
except that the Fund may borrow from banks or may not exceed 33 1/3% of the value of the
enter into reverse repurchase agreements for Fund's total assets.
temporary emergency purposes in amounts up to
33 1/3% of the value of its total assets at
the time of such borrowing. The Fund will not
purchase securities while borrowings
(including reverse repurchase agreements) in
excess of 5% of its total assets are
outstanding. In addition, the Fund is
permitted to participate
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
in a credit facility whereby the Fund may
directly lend to and borrow money from other
AmSouth Funds for temporary purposes,
provided that the loans are made in
accordance with an order of exemption from
the SEC and any conditions thereto.
------------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth International Equity Fund may not Pioneer International Core Equity Fund may
make loans, except that the Fund may purchase make loans, except by the purchase of debt
or hold debt instruments in accordance with obligations in which the Fund may invest
its investment objective and policies, lend consistent with its investment policies, by
Fund securities in accordance with its entering into repurchase agreements or
investment objective and policies and enter through the lending of portfolio securities,
into repurchase agreements. In addition, the in each case only to the extent permitted by
Fund is permitted to participate in a credit the prospectus and this statement of
facility whereby the Fund may directly lend additional information.
to and borrow money from other AmSouth Funds
for temporary purposes, provided that the
loans are made in accordance with an order of
exemption from the SEC and any conditions
thereto.
------------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth International Equity Fund may invest Pioneer International Core Equity Fund may
in futures contracts and options thereon use futures and options on securities,
(interest rate futures contracts or index indices and currencies, forward currency
futures contracts, as applicable) to commit exchange contracts and other derivatives. The
funds awaiting investment, to maintain cash Fund does not use derivatives as a primary
liquidity or for other hedging purposes. The investment technique and generally limits
value of the Fund's contracts may equal or their use to hedging. However, the Fund may
exceed 100% of the Fund's total assets, use derivatives for a variety of
although the Fund will not purchase or sell a non-principal purposes, including:
futures contract unless immediately
afterwards the aggregate amount of margin o As a hedge against adverse changes in
deposits on its existing futures positions stock market prices, interest rates or
plus the amount of premiums paid for related currency exchange rates
futures options entered into for other than
bona fide hedging purposes is 5% or less of o As a substitute for purchasing or selling
its net assets. securities
The AmSouth Fund also may write covered put o To increase the Fund's return as a
options in respect of specific securities in non-hedging strategy that may be
which the Fund may invest and write covered considered speculative
call and put option contracts. The size of
the premiums that the Fund may receive may be
adversely affected as new or existing
institutions, including other investment
companies, engage in or increase their
option-writing activities.
------------------------------------------------------------------------------------------------------------------------------------
Short-term trading The AmSouth International Equity Fund may Pioneer International Core Equity Fund does
engage in the technique of short-term not usually trade for short-term profits. The
trading. Such trading involves the selling of Fund will sell an investment, however, even
securities held for a short time, ranging if it has only been held for a short time, if
from several months to less than a day. The it no longer meets the Fund's investment
object of such short-term trading is to criteria.
increase the potential for capital
appreciation and/or income of the
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Fund in order to take advantage of what AAMI
believes are changes in market, industry or
individual company conditions or outlook.
------------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------------
Class A sales charges Class A shares are offered with an initial Class A shares are offered with an initial
and Rule 12b-1 fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may Funds Distributor, Inc. ("PFD"), the Fund's
be charged a contingent deferred sales charge distributor, of up to 5% declining as the
("CDSC") of 1.00% if sold within one year of size of your investment increases.
purchase.
There is no CDSC except in certain
Class A shares pay a shareholder servicing circumstances when the initial sales charge
fee (non 12b-1) of up to 0.25% of average is waived.
daily net assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Class B sales charges Class B shares are offered without an initial Class B shares are offered without an initial
and Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive
continuously declines over six years, a commission from PFD, the Fund's
starting with year one and ending in year distributor, at the time of your purchase of
seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all up to 4%.
other Class B shares held continuously, the
CDSC declines over six years, starting with Class B shares are subject to distribution
year one and ending in year seven from: 5%, and service (12b-1) fees of up to 1% of
4%, 3%, 3%, 2%, 1%. Eight years after average daily net assets.
purchase (seven years in the case of shares
acquired in the ISG combination), Class B Maximum purchase of Class B shares in a
shares automatically convert to Class A single transaction is $49,999.
shares.
Class B shares acquired through the
Class B shares pay a shareholder servicing Reorganization will be subject to the CDSC
fee (non 12b-1) of up to 0.25% of average and commission schedules applicable to the
daily net assets and a distribution (12b-1) original purchase.
fee of 0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y sales AmSouth International Equity Fund does not The Fund does not impose any initial,
charges and Rule 12b-1 fees impose any initial or contingent deferred contingent deferred or asset based sales
sales charge on Class I shares. charge on Class Y shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average distributing the Fund's Class Y shares, none
daily net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth International Equity Fund pays an Pioneer International Core Equity Fund pays
advisory fee on a monthly basis at an annual Pioneer an annual fee equal to 0.95% of the
rate of 0.90% of the Fund's average daily net Fund's average daily net assets. The fee is
assets. computed daily and paid monthly.
ASO Services Company, Inc. ("ASO") serves as In addition, the Fund reimburses Pioneer for
administrator and fund accounting agent for certain fund accounting and legal expenses
the Fund. The Fund pays ASO an administrative incurred on behalf of the Fund and pays a
services fee of 0.15% of the Fund's average separate shareholder servicing/transfer
daily net assets. agency fee to PIMSS, an affiliate of Pioneer.
Other expenses of the Fund are being limited The Fund's total annual fund operating
to 0.42% for Class A shares, 0.41% for Class expenses are estimated to be 1.41% of average
B shares and 0.26% for Class I shares. Any daily net assets for Class A shares, 2.43%
fee waiver or expense reimbursement for Class B shares, and 1.10% for Class Y
arrangement is voluntary and may be shares for the current fiscal year.
discontinued at any time.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class A
shares, after giving effect to the expense
limitation were 1.32%, and without giving
effect to the expense limitation, were 1.43%
of average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class B
shares, after giving effect to the expense
limitation were 2.06%, and without giving
effect to the expense limitation, were 2.17%
of average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 1.16%, and without giving
effect to the expense limitation, were 1.32%
of average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor
investment advisers, banks and other
financial institutions that have entered into If the account is established in the
selling agreements with the Fund's shareholder's own name, shareholders may also
distributor, as purchase additional shares of the Pioneer
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
described in the Fund's prospectus. Fund by telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
Fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one Fund to charging you either an initial or contingent
another are taxable. Class A shares may be deferred shares charge at the time of the
exchanged for Class I shares of the same Fund exchange. Shares you acquire as part of an
or another AmSouth Fund if you become exchange will continue to be subject to any
eligible to purchase Class I shares. Class I contingent deferred sales charge that applies
shares may be exchanged for Class A shares of to the shares you originally purchased. When
the same Fund. No transaction fees are you ultimately sell your shares, the date of
currently charged for exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 30 days purchase of shares for federal income tax
of the date of purchase, you will be charged purposes.
a 2.00% fee on the current net asset value of
the shares sold or exchanged. The fee is paid After you establish an eligible fund account,
to the Fund to offset the costs associated you can exchange Fund shares by telephone or
with short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares
purchased first will be considered redeemed
first for purposes of determining whether the
redemption fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan
administrator or brokerage firm to implement
the fee). The Fund will not impose the
redemption fee on a redemption or exchange of
shares purchased upon the reinvestment of
dividend and capital gain distributions.
------------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
------------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The non-U.S. stock markets go down or perform poorly relative to other investments (this risk may be greater in the short term)
o Equity securities of non-U.S. issuers or growth stocks fall out of favor with investors
o The Fund's investments do not have the growth potential originally expected
Each Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Funds invests in issuers in countries with emerging markets or if the Funds invest significantly in one country. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the adviser/subadviser might not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
In addition, at times, more than 25% of Pioneer International Core Equity Fund's assets may be invested in the same market segment, such as financial or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a Fund without the same focus.
AmSouth International Equity Fund is subject to risks relating to the fact that it is non-diversified. The Fund may invest in a small number of companies which may increase the volatility of the Fund. Accordingly, the Fund's portfolio may be more sensitive to changes in the market value of a single company or industry.
AmSouth International Equity Fund may trade securities actively to achieve its principal investment strategies. Active trading of portfolio securities could increase the Fund's transaction costs (thereby lowering its performance) and may increase the amount of taxes that you pay (on distributions of net gains realized on those trades).
Past Performance
Set forth below is performance information for AmSouth International Equity Fund. The bar charts show how your AmSouth Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for your AmSouth Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in your AmSouth Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results. Pioneer International Core Equity Fund has not commenced investment operations.
AmSouth International Equity Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]]
1998 1999 2000 2001 2002 2003 2004 9.48 26.77 -11.50 -24.31 -14.95 52.67 25.84 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 23.15% for the quarter ended June 30, 2003, and the lowest quarterly return was -20.23% for the quarter ended September 30, 2002.
AmSouth International Equity Fund Average Annual Total Returns for the periods ending December 31, 2004
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
(8/15/97)
---------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund, Class A Shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes(1) 18.95% 0.68% 4.60%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 18.60% 0.41% 4.33%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 12.31% 0.45% 3.83%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund, Class B Shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 19.81% 0.76% 4.60%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth International Equity Fund, Class I Shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 26.05% 2.03% 5.54%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 25.64% 1.75% 5.24%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 16.93% 1.57% 4.65%
---------------------------------------------------------------------------------------------------------------------------------
MSCI EAFE Index (3) 20.00% -0.08% 5.45%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) The quoted returns reflect the performance from 8/15/97 to 12/13/98 of the DG International Equity Fund and from 12/14/98 to 3/12/00 of the ISG International Equity Fund, which were open-end investment companies that were the predecessor funds to the International Equity Fund. The predecessor funds were managed using substantially the same investment objective, policies and methodologies as the Fund. Class A shares were first offered on 8/15/97. Performance for the Class B shares, which were first offered on 2/2/99, is based on the historical performance of the Fund's Class A shares, including the performance of the predecessor funds, (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B distribution (12b-1) fees and the contingent deferred sales charge.
(2) The quoted returns reflect the performance from 8/15/97 to 12/13/98 of the DG International Equity Fund and from 12/14/98 to 3/12/00 of the ISG International Equity Fund, which were open-end investment companies that were the predecessor funds to the International Equity Fund. The predecessor funds were managed using substantially the same investment objective, policies and methodologies as the Fund Performance for the Class I shares, which were first offered on 12/14/98, is based on the historical performance of the Fund's Class A shares, including the performance of the predecessor funds (without sales charge) prior to that date.
(3) The Morgan Stanley Capital International Europe, Australasia, Far East Index ("MSCI EAFE Index"), an unmanaged, capitalization weighted index of 21 international markets, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes and was calculated from 7/31/97.
The above table shows the impact of taxes on the AmSouth International Equity Fund's returns. After-tax returns are only shown for Class A shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
The most recent portfolio manager's discussion of your AmSouth Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for AmSouth International Equity Fund, the expenses of AmSouth International Equity Fund for the period ended January 31, 2005 and (ii) for Pioneer International Core Equity Fund, and (ii) for the Pioneer International Core Equity Fund, the estimated pro forma annual expenses assuming the Reorganization occurred on May 31, 2005.
-------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer AmSouth Pioneer AmSouth Pioneer
transaction fees International International International International International International
(paid directly from Equity Fund(1) Core Equity Equity Fund(1) Core Equity Equity Fund(1) Core Equity
your investment) Fund (Pro Fund (Pro Fund (Pro
Forma) Forma) Forma)
Class A Class A Class B Class B Class I Class Y
-------------------------------------------------------------------------------------------------------------------------------
Maximum sales charge 5.50%(2) 5.75%(2) None None None None
(load) when you buy
shares as a
percentage of
offering price
-------------------------------------------------------------------------------------------------------------------------------
Maximum deferred None None 5.00%(3) 4.00% None None
sales charge (load)
as a percentage of
purchase price or
the amount you
receive when you
sell shares,
whichever is less
-------------------------------------------------------------------------------------------------------------------------------
|
-------------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Pioneer AmSouth Pioneer AmSouth Pioneer
transaction fees International International International International International International
(paid directly from Equity Fund(1) Core Equity Equity Fund(1) Core Equity Equity Fund(1) Core Equity
your investment) Fund (Pro Fund (Pro Fund (Pro
Forma) Forma) Forma)
Class A Class A Class B Class B Class I Class Y
-------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) 2.00% 2.00%(4) 2.00% 2.00%(4) 2.00%
-------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating expenses
(deducted from fund
assets) (as a % of
average net assets)
-------------------------------------------------------------------------------------------------------------------------------
Management fee 0.90% 0.95% 0.90% 0.95% 0.90% 0.95%
-------------------------------------------------------------------------------------------------------------------------------
Distribution and None 0.25% 0.75% 1.00% None None
service (12b-1) fee
-------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.80%(5) 0.21% 1.15%(5) 0.48% 0.67%(5) 0.15%
-------------------------------------------------------------------------------------------------------------------------------
Total fund operating 1.70% 1.41%(6) 2.80% 2.43%(6) 1.57% 1.10%(6)
expenses
-------------------------------------------------------------------------------------------------------------------------------
Expense 0.39% N/A 0.74% N/A 0.41% N/A
reimbursement/reduction
-------------------------------------------------------------------------------------------------------------------------------
Net fund operating 1.31% 1.41% 2.06% 2.43% 1.16% 1.10%
expenses
-------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 30 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.41% for Class A shares, 0.41% for Class B shares and 0.26% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------------------------
Number of years you AmSouth International Equity Fund Pro Forma
own your shares Pioneer International Core Equity Fund
------------------------------------------------------------------------------------------------------------
Class A
------------------------------------------------------------------------------------------------------------
Year 1 $713 $790
------------------------------------------------------------------------------------------------------------
Year 3 $1,056 $996
------------------------------------------------------------------------------------------------------------
Year 5 $1,422 $1,302
------------------------------------------------------------------------------------------------------------
Year 10 $2,448 $2,169
------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
------------------------------------------------------------------------------------------------------------
Year 1 $783 $646
------------------------------------------------------------------------------------------------------------
Year 3 $1,168 $1,058
------------------------------------------------------------------------------------------------------------
Year 5 $1,679 $1,396
------------------------------------------------------------------------------------------------------------
Year 10 $2,865 $2,513
------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
------------------------------------------------------------------------------------------------------------
Year 1 $283 $246
------------------------------------------------------------------------------------------------------------
Year 3 $868 $758
------------------------------------------------------------------------------------------------------------
Year 5 $1,479 $1,296
------------------------------------------------------------------------------------------------------------
Year 10 $2,865 $2,513
------------------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------------------
Year 1 $160 $112
------------------------------------------------------------------------------------------------------------
Year 3 $496 $350
------------------------------------------------------------------------------------------------------------
Year 5 $855 $606
------------------------------------------------------------------------------------------------------------
Year 10 $1,867 $1,340
------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of Amsouth International Equity Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Third, the estimated pro forma expenses of the Pioneer Fund, after giving effect to the Reorganization, on a gross basis are lower than your AmSouth Fund's gross operating expenses. The Trustees recognized that the Pioneer Fund's operating expenses net of expense limitations, and its management fee, are higher than your Fund's expenses net of expense limitations and management fee (except for Class I shares, for which pro forma expenses of the Pioneer Fund's Class Y shares are estimated to be lower on both a gross and a net basis). However, the expense limitations on your AmSouth Fund are voluntary and may be discontinued at any time. In addition, the Trustees considered the positive factors associated with the Reorganization to outweigh the negative factors, such as the increase in expenses of the Pioneer Fund. The Trustees also considered that the aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of each Fund are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Fourth, the Class A, B and Y shares of Pioneer International Core Equity Fund received in the Reorganization will provide AmSouth International Equity Fund shareholders with exposure to substantially the same investment product as they currently have.
Fifth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
--------------------------------------------------------------------------------------------------------------
Pro Forma
Pioneer Pioneer
AmSouth International International
International Core Equity Core Equity
Equity Fund Fund Fund
May 31, 2005 May 31, 2005 May 31, 2005
--------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $466,466 N/A $466,466
--------------------------------------------------------------------------------------------------------------
Class A shares ................................... $25,582 N/A $25,582
--------------------------------------------------------------------------------------------------------------
Class B shares ................................... $3,070 N/A $3,070
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $437,814 N/A $437,814
--------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
--------------------------------------------------------------------------------------------------------------
Class A shares ................................... $13.35 N/A $13.35
--------------------------------------------------------------------------------------------------------------
Class B shares ................................... $13.03 N/A $13.03
--------------------------------------------------------------------------------------------------------------
Class I /Y shares ................................ $13.41 N/A $13.41
--------------------------------------------------------------------------------------------------------------
Shares Outstanding
--------------------------------------------------------------------------------------------------------------
Class A shares ................................... 1,916,864 N/A 1,916,864
--------------------------------------------------------------------------------------------------------------
Class B shares ................................... 235,732 N/A 235,732
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. 32,649,798 N/A 32,649,798
--------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Select Equity Fund and Pioneer Focused Equity Fund
PROPOSAL 1 (h)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-2, because it contains details that are not in the summary.
Each Fund has an investment objective of long-term capital growth and, consequently, the Funds have similar investment polices and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Select Equity Fund to Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Business A non-diversified series of AmSouth Funds, an A newly created, non-diversified series of
open-end management investment company Pioneer series Trust IV, an open-end
organized as a Massachusetts business trust. management investment company organized as a
Delaware statutory trust.
------------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, 2005 $132.4 million None. Pioneer Focused Equity Fund is newly
created and does not expect to commence
investment operations until the
Reorganization occurs.
------------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Investment Subadviser: Investment Subadviser:
OakBrook Investments, LLC ("OakBrook") OakBrook
Portfolio Managers: Portfolio Managers:
Day-to-day management of AmSouth Select Day-to-day management of Pioneer Focused
Equity Fund's portfolio is the responsibility Equity Fund's portfolio is the responsibility
of a team of investment professionals, all of of a team of investment professionals, all of
whom take part in the decision making whom take part in the decision making
process. Dr. Neil Wright, Ms. Janna Sampson process. Dr. Neil Wright, Ms. Janna Sampson
and Dr. Peter Jankovskis are the team members and Dr. Peter Jankovskis are the team members
and have been the portfolio managers of the and have been the portfolio managers of the
Fund since its inception. Each of the Fund since its inception. Each of the
portfolio managers has been with OakBrook portfolio managers has been with OakBrook
since 1998. since 1998.
Dr. Wright is OakBrook's President and Chief Dr. Wright is OakBrook's President and Chief
Investment Officer. From 1993 to 1997, Dr. Investment Officer. From 1993 to 1997, Dr.
Wright was the Chief Investment Officer of Wright was the Chief Investment Officer of
ANB Investment Management & Trust Co. ANB.
("ANB").
Ms. Sampson is OakBrook's Director of
Ms. Sampson is OakBrook's Director of Portfolio Management. From 1993 to 1997,
Portfolio Management. From 1993 to 1997, she
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
was Senior Portfolio Manager for ANB. she was Senior Portfolio Manager for ANB.
Dr. Jankovskis is OakBrook's Director of Dr. Jankovskis is OakBrook's Director of
Research. From 1992 to 1996, he was an Research. From 1992 to 1996, he was an
Investment Strategist for ANB and from 1996 Investment Strategist for ANB and from 1996
to 1997 he was the Manager of Research for to 1997 he was the Manager of Research for
ANB. ANB.
------------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Select Equity Fund seeks long-term Pioneer Focused Equity Fund seeks long-term
growth of capital by investing primarily in capital growth.
common stocks and securities convertible into
common stocks such as convertible bonds and
convertible preferred stocks.
------------------------------------------------------------------------------------------------------------------------------------
Primary investments Under normal circumstances, AmSouth Select Normally, the Fund invests at least 80% of
Equity Fund invests at least 80% of its net its net assets (plus the amount of
assets in equity securities. For purposes of borrowings, if any, for investment purposes)
this policy, net assets include net assets in equity securities. The Fund may invest a
plus borrowings for investment purposes. The significant portion of its assets in equity
Fund invests primarily in common stocks with securities of medium- and
market capitalizations greater than $2 large-capitalization companies. Consequently,
billion at the time of purchase and that the Fund will be subject to the risks of
possess a dominant market share and have investing in companies with market
barriers, such as a patent or well -known capitalizations of $1.5 billion or more.
brand name, that shield their market share
and profits from competitors. OakBrook does For purposes of the Fund's investment
not currently intend to purchase convertible policies, equity securities include common
securities for the Fund. stocks, convertible debt and other equity
instruments, such as depositary receipts,
warrants, rights, exchange-traded funds
(ETFs), interests in real estate investment
trusts (REITs) and preferred stocks.
------------------------------------------------------------------------------------------------------------------------------------
Investment strategies In managing the Fund's portfolio, OakBrook Pioneer Focused Equity Fund seeks securities
continuously monitors a universe of companies that its believes possess a dominant market
possessing "market power" to look for share and have barriers, such as a patent or
opportunities to purchase these stocks at well-known brand name, that may shield their
reasonable prices. "Market power" is a market share and profits from competitors.
combination of dominant market share and The subadviser continuously monitors a
a barrier that protects that market share. In universe of companies possessing "market
selecting individual securities, OakBrook power" to look for opportunities to purchase
looks for companies that appear undervalued. these stocks at reasonable prices. "Market
OakBrook then conducts a fundamental analysis power" is a combination of dominant market
of the stock, the industry and the industry share and a barrier that protects that market
structure. OakBrook will then purchase those share. In selecting individual securities,
companies whose market power, in the the subadviser looks for companies that
managers' opinion, is intact. As a result, appear undervalued. The subadviser then
OakBrook may focus on a relatively conducts a fundamental analysis of the stock,
limited number of stocks (i.e., generally 25 the industry and the industry structure. The
or less). subadviser then purchases those companies
whose market power, in the subadviser's
opinion, is intact. As a result, the
subadviser may focus on a relatively limited
number of securities (i.e., generally 25 or
fewer).
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Other investments AmSouth Select Equity Fund may invest in Pioneer Focused Equity Fund may invest up to
common stocks and securities convertible into 20% of its total assets in debt securities of
common stocks of companies with market corporate and government issuers. Generally
capitalizations less than $2 billion and the Fund acquires debt securities that are
preferred stocks. investment grade, but the Fund may invest up
to 5% of its total assets in below investment
The Fund may also invest up to 20% of its grade debt securities issued by both U.S. and
assets in corporate bonds, notes, and non-U.S. corporate and government issuers,
warrants, and short-term money market including below investment grade convertible
instruments. Stock futures and option debt securities. The Fund invests in debt
contracts and stock index futures and index securities when the subadviser believes they
option contracts may be used to hedge cash are consistent with the Fund's investment
and maintain exposure to the U.S. equity objective, long-term capital growth, or for
market. greater liquidity.
The Fund may invest in common stocks and
securities convertible into common stocks of
companies with market capitalizations less
than $2 billion and preferred stocks.
The Fund may also invest up to 20% of its
assets in corporate bonds, notes, and
warrants, and short-term money market
instruments. Stock futures and option
contracts and stock index futures and index
option contracts may be used to hedge cash
and maintain exposure to the U.S. equity
market.
The Fund may invest up to 25% of its total
assets in equity and debt securities of
non-U.S. corporate issuers and debt
securities of non-U.S. government issuers,
including securities of emerging markets
issuers. The Fund invests in non-U.S.
securities to diversify its portfolio when
they offer similar or greater potential for
capital appreciation compared to U.S.
securities.
------------------------------------------------------------------------------------------------------------------------------------
Temporary defensive strategies When AAMI determines adverse market Normally, the Fund invests substantially all
conditions exist, AmSouth Select Equity Fund of its assets to meet its investment
may invest entirely in cash positions, objective. The Fund may invest the remainder
directly in U.S. Government securities and of its assets in securities with remaining
short-term paper, such as bankers' maturities of less than one year, cash
acceptances. equivalents or may hold cash. For temporary
defensive purposes, including during periods
of unusual cash flows, the Fund may depart
from its principal investment strategies and
invest part or all of its assets in these
securities or may hold cash. During such
periods, the Fund may not be able to achieve
its investment objective. The Fund intends to
adopt a defensive strategy when the
subadviser believes securities in which the
Fund normally invests have extraordinary
risks due to political or
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
economic factors and in other extraordinary
circumstances.
------------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is non-diversified for the purpose of the Investment Company Act and, therefore, may
concentrate its investments in a limited number of issuers.
------------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Select Equity Fund may not purchase Pioneer Focused Equity Fund may not invest
any securities which would cause more than more than 25% of its assets in any one
25% of the value of the Fund's total assets industry.
at the time of purchase to be invested in
securities of one or more issuers conducting
their principal business activities in the
same industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the
U.S. government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their
activities are primarily related to financing
the activities of their parents; and
(c) utilities will be divided according to
their services. For example, gas, gas
transmission, electric and gas, electric, and
telephone will each be considered a separate
industry.
------------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Select Equity Fund may not invest Pioneer Focused Equity Fund may not invest
securities more than 15% of its net assets in securities more than 15% of its net assets in securities
that are restricted as to resale, or for that are illiquid and other securities that
which no readily available market exists, are not readily marketable. Repurchase
including repurchase agreements providing for agreements maturing in more than seven days
settlement more than seven days after notice. will be included for purposes of the
foregoing limit.
------------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Select Equity Fund may not borrow Pioneer Focused Equity Fund may not borrow
money or issue senior securities, except the money, except the Fund may: (a) borrow from
Fund may borrow from banks or enter into banks or through reverse repurchase
reverse repurchase agreements for temporary agreements in an amount up to 33 1/3% of the
emergency purposes in amounts up to 33 1/3% Fund's total assets (including the amount
of the value of its total assets at the time borrowed); (b) to the extent permitted by
of such borrowing. The Fund will not purchase applicable law, borrow up to an additional 5%
securities while borrowings (including of the Fund's assets for temporary purposes;
reverse repurchase agreements) in excess of (c) obtain such short-term credits as are
5% of its total assets are outstanding. necessary for the clearance of portfolio
transactions; (d) purchase securities on
margin to the extent permitted by applicable
law; and (e) engage in transactions in
mortgage dollar rolls that are accounted for
as financings.
------------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Select Equity Fund may not make Pioneer Focused Equity Fund may not make
loans, except that the Fund may purchase or loans, except that the Fund may (i) lend
hold debt instruments in accordance with its portfolio securities in accordance with the
investment objective and policies, lend Fund Fund's investment policies, (ii) enter into
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
securities in accordance with its investment repurchase agreements, (iii) purchase all or
objective and policies and enter into a portion of an issue of publicly distributed
repurchase agreements. debt securities, bank loan participation
interests, bank certificates of deposit,
bankers' acceptances, debentures or other
securities, whether or not the purchase is
made upon the original issuance of the
securities, (iv) participate in a credit
facility whereby the Fund may directly lend
to and borrow money from other affiliated
funds to the extent permitted under the
Investment Company Act or an exemption
therefrom, and (v) make loans in any other
manner consistent with applicable law, as
amended and interpreted or modified from time
to time by any regulatory authority having
jurisdiction.
------------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Select Equity Fund may invest in Pioneer Focused Equity Fund may use futures
futures contracts and options thereon and options on securities, indices and
(interest rate futures contracts or index currencies, forward currency exchange
futures contracts, as applicable) to commit contracts and other derivatives. A derivative
funds awaiting investment, to maintain cash is a security or instrument whose value is
liquidity or for other hedging purposes. The determined by reference to the value or the
value of the Fund's contracts may equal or change in value of one or more securities,
exceed 100% of the Fund's total assets, currencies, indices or other financial
although the Fund will not purchase or sell a instruments. Although there is no specific
futures contract unless immediately limitation on investing in derivatives, the
afterwards the aggregate amount of margin Fund does not use derivatives as a primary
deposits on its existing futures positions investment technique and generally limits
plus the amount of premiums paid for related their use to hedging. However, the Fund may
futures options entered into for other than use derivatives for a variety of
bona fide hedging purposes is 5% or less of non-principal purposes, including:
its net assets.
o As a hedge against adverse changes in
The Fund also may write covered put options stock market prices, interest rates or
in respect of specific securities in which currency exchange rates
the Fund may invest and write covered call
and put option contracts. The size of the o As a substitute for purchasing or selling
premiums that the Fund may receive may be securities
adversely affected as new or existing
institutions, including other investment o To increase the Fund's return as a
companies, engage in or increase their non-hedging strategy that may be
option-writing activities. considered speculative
Even a small investment in derivatives can
have a significant impact on the Fund's
exposure to stock market values, interest
rates or currency exchange rates. If changes
in a derivative's value do not correspond to
changes in the value of the Fund's other
investments, the Fund may not fully benefit
from or could lose money on the derivative
position. In addition, some derivatives
involve risk of loss if the person who issued
the derivative defaults on its obligation.
Certain derivatives may be less liquid and
more
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
difficult to value. The Fund will only invest
in derivatives to the extent the subadviser
believes these investments do not prevent the
Fund from seeking its investment objective.
------------------------------------------------------------------------------------------------------------------------------------
Short-term trading AmSouth Select Equity Fund may engage in the Pioneer Focused Equity Fund usually does not
technique of short-term trading. Such trading trade for short-term profits. A Fund will
involves the selling of securities held for a sell an investment, however, even if it has
short time, ranging from several months to only been held for a short time, if it no
less than a day. The object of such longer meets the Fund's investment criteria.
short-term trading is to increase the
potential for capital appreciation and/or
income of the Fund in order to take advantage
of what AAMI believes are changes in market,
industry or individual company conditions or
outlook.
------------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
------------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may Funds Distributor, Inc. ("PFD"), the Fund's
be charged a contingent deferred sales charge distributor, of up to 4% declining as the
("CDSC") of 1.00% if sold within one year of size of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing circumstances when the initial sales charge
fee (non 12b-1) of up to 0.25% of average is waived.
daily net assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares held continuously, to 4% if you sell your shares. The charge is
the CDSC declines over six years, starting reduced over time and is not charged after
with year one and ending in year seven from: five years. Your investment firm may receive
5%, 4%, 3%, 2%, 1%. Eight years after a commission from PFD, the Fund's
purchase Class B shares automatically convert distributor, at the time of your purchase of
to Class A shares. up to 4%.
Class B shares pay a shareholder servicing Class B shares are subject to distribution
fee (non 12b-1) of up to 0.25% of average and service (12b-1) fees of up to 1% of
daily net assets. This fee is in the form of average daily net assets.
a separate non-Rule 12b-1 fee. All Funds bear
a distribution Class B shares acquired through the
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
(12b-1) fee of up to 0.75%. Reorganization will be subject to the CDSC
and commission schedules applicable to the
Maximum investment for all Class B purchases original purchase.
by a shareholder for the Fund's shares is
$99,999. Maximum purchase of Class B shares in a
single transaction is $49,999.
------------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y sales AmSouth Select Equity Fund does not impose The Fund does not impose any initial,
charges and Rule 12b-1 fees any initial or a CDSC on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth Select Equity Fund pays an advisory Pioneer Focused Equity Fund will pay Pioneer
fee on a monthly basis at an annual rate of an advisory fee as follows: 0.65% of the
0.80% of the Fund's average daily net assets. Fund's average daily net assets up to
$1 billion, and 0.60% on assets greater than
ASO Services Company, Inc. ("ASO") serves as $1 billion. The fee is computed daily and
administrator and fund accounting agent for paid monthly.
the Fund. The Fund pays ASO an administrative
services fee of 0.15% of the Fund's average In addition, the Fund will reimburse Pioneer
daily net assets. for certain fund accounting and legal
expenses incurred on behalf of the Fund and
Other expenses of the Fund are being limited pay a separate shareholder servicing/transfer
to 0.49% for Class A shares, 0.49% for Class agency fee to PIMSS, an affiliate of Pioneer.
B shares and 0.34% for Class I shares. Any
fee waiver or expense reimbursement The Fund's total annual fund operating
arrangement is voluntary and may be expenses are estimated to be 1.17% of average
discontinued at any time. daily net assets for Class A shares, 2.03%
for Class B shares, and 0.79% for Class Y
For the fiscal year ended July 31, 2004, the shares for the current fiscal year.
Fund's annual operating expenses for Class A
shares, after giving effect to the expense
limitation were 1.29%, and without giving
effect to the expense limitation, were 1.32%
of average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class B
shares, after giving effect to the expense
limitation were 2.04%, and without giving
effect to the expense limitation, were 2.07%
of average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 1.14%, and without giving
effect to the expense limitation, were 1.22%
of average daily net assets.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other
financial institutions that have entered into If the account is established in the
selling agreements with the Fund's shareholder's own name, shareholders may also
distributor, as described in the Fund's purchase additional shares of the Fund by
prospectus. telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
Fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one Fund to charging you either an initial or contingent
another are taxable. Class A shares may be deferred shares charge at the time of the
exchanged for Class I shares of the same Fund exchange. Shares you acquire as part of an
or another AmSouth fund if you become exchange will continue to be subject to any
eligible to purchase Class I shares. Class I contingent deferred sales charge that applies
shares may be exchanged for Class A shares of to the shares you originally purchased. When
the same Fund. No transaction fees are you ultimately sell your shares, the date of
currently charged for exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days purchase of shares for federal income tax
of the date of purchase, you will be charged purposes.
a 2.00% fee on the current net asset value of
the shares sold or exchanged. The fee is paid After you establish an eligible fund account,
to the Fund to offset the costs associated you can exchange Fund shares by telephone or
with short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares
purchased first will be considered redeemed
first for purposes of determining whether the
redemption fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan
administrator or brokerage firm to implement
the fee). The Fund will not impose the
redemption fee on a redemption or exchange of
shares purchased upon the reinvestment of
dividend and capital gain distributions.
------------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund Pioneer Focused Equity Fund
------------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
--------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
------------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o The market segment on which the Fund focuses - undervalued growth stocks - underperforms other kinds of investments or market averages
o Value stocks fall out of favor with investors
o The adviser's/subadviser's judgment about the attractiveness, growth potential or potential appreciation of a particular stock proves to be incorrect
Each Fund is subject to risks relating to the fact that it is non-diversified. Each Fund may invest in a small number of companies which may increase the volatility of the Fund. Accordingly, each Fund's portfolio may be more sensitive to changes in the market value of a single company or industry.
Each Fund may trade securities actively to achieve its principal investment strategies. Active trading of portfolio securities could increase the Fund's transaction costs (thereby lowering its performance) and may increase the amount of taxes that you pay (on distributions of net gains realized on those trades). However, the adviser/subadviser expects that the Fund's annual portfolio turnover rate will average less than 50% each year.
If either Fund invests in securities with additional risk, that Fund's share price volatility accordingly could be greater and its performance lower.
At times, more than 25% of the Pioneer Focused Equity Fund's assets may be invested in the same market segment, such as financials or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus. For example, industries in the financial segment, such as banks, insurance companies, broker-dealers and REITs, may be sensitive to changes in interest rates and general economic activity and are subject to extensive government regulation. Industries in the technology segment, such as information technology, communications equipment, computer hardware and software, and office and scientific equipment, are subject to risks of rapidly evolving technology, short product lives, rates of corporate expenditures, falling prices and profits, competition from new market entrants, and general economic conditions.
Pioneer Focused Equity Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. Some of these risks do not apply to larger, more developed non-U.S. countries. However, these risks are more pronounced for issuers of securities in emerging markets. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, Pioneer may not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
Past Performance
Set forth below is performance information for AmSouth Select Equity Fund. The bar charts show how AmSouth Select Equity Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return for AmSouth Select Equity Fund over time for each class of shares compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in AmSouth Select Equity Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance does not indicate future results. Pioneer Focused Equity Fund has not commenced investment operations.
AmSouth Select Equity Fund -- Class A Shares Calendar Year Total Returns*
[DATA BELOW IS REPRESENTED BY A BAR CHART IN THE ORIGINAL REPORT]
1999 2000 2001 2002 2003 2004 -10.12% 12.66% 7.45% -9.12% 26.03% 9.93% |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 17.30% for the quarter ended December 31, 2000, and the lowest quarterly return was -13.07% for the quarter ended September 30, 1999.
AmSouth Select Equity Fund Average Annual Total Returns (as of December 31, 2004)
---------------------------------------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
(September 1, 1998)
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund, Class A Shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes(1) 3.90% 7.56% 7.29%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 3.66% 7.39% 6.62%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 2.53% 6.46% 5.90%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund, Class B Shares
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes(1) 4.10% 7.72% 7.47%
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Select Equity Fund, Class I Shares(2)
---------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 10.10% 8.97% 8.43%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 9.83% 8.76% 7.72%
---------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 6.56% 7.68% 6.88%
---------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index(3) 10.87% -2.30% 4.71%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 9/1/98. Performance for the Class B shares, which were first offered on 9/2/98, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the contingent deferred sales charge.
2 Performance for the Class I shares, which were first offered on 9/1/98, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date.
(3) The S&P 500 Index, a widely recognized, unmanaged index of 500 common stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on the Fund's returns. After-tax returns are only shown for Class A shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that beneflts the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
The most recent portfolio manager's discussion of AmSouth Select Equity Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly
or indirectly. The table below shows the fees and expenses that you would pay if
you were to buy and hold shares of each Fund. The expenses in the table
appearing below are based on (i) for the AmSouth Select Equity Fund, the
expenses of AmSouth Select Equity Fund for the period ended January 31, 2005 and
(ii) for the Pioneer Focused Equity Fund, the estimated pro forma annual
expenses for the period ended May 31, 2005.
----------------------------------------------------------------------------------------------------------------------------
Shareholder AmSouth Select Pioneer Focused AmSouth Select Pioneer Focused AmSouth Select Pioneer Focused
transaction Equity Fund(1) Equity Fund Equity Fund(1) Equity Fund Equity Fund(1) Equity Fund
fees (paid (Pro Forma) (Pro Forma) (Pro forma)
directly from
your
investment) Class A Class A Class B Class B Class I Class Y
----------------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75%(2) None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
----------------------------------------------------------------------------------------------------------------------------
Maximum None None 5.00%(3) 4.00% None None
deferred sales
charge (load)
as a
percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
----------------------------------------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) None 2.00%(4) None 2.00%(4) None
----------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
----------------------------------------------------------------------------------------------------------------------------
Management fee 0.80% 0.65% 0.80% 0.65% 0.80% 0.65%
----------------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.75% 1.00% None None
and service
(12b-1) fee
----------------------------------------------------------------------------------------------------------------------------
Other expenses 0.60%(5) 0.27% 0.61%(5) 0.38% 0.46%(5) 0.14%
----------------------------------------------------------------------------------------------------------------------------
Total fund 1.40% 1.17% (6) 2.16% 2.03% (6) 1.26% 0.79% (6)
operating
expenses
----------------------------------------------------------------------------------------------------------------------------
Expense 0.11% N/A 0.12% N/A 0.12% N/A
reimbursement/
reduction
----------------------------------------------------------------------------------------------------------------------------
Net fund 1.29% 1.17% 2.04% 2.03% 1.14% 0.79%
operating
expenses
----------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) A CDSC on Class B shares held continuously declines over six years starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.49% for Class A shares, 0.49% for Class B shares and 0.34% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, (d) each Fund's gross operating expenses remain the same, and (e) the expense limitation for your Fund is in effect for year one. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
-----------------------------------------------------------------------------------
Number of years you AmSouth Equity Select Fund Pro Forma
own your shares Pioneer Focused Equity Fund
-----------------------------------------------------------------------------------
Class A
-----------------------------------------------------------------------------------
Year 1 $685 $687
-----------------------------------------------------------------------------------
Year 3 $969 $925
-----------------------------------------------------------------------------------
Year 5 $1,274 $1,182
-----------------------------------------------------------------------------------
Year 10 $2,095 $1,194
-----------------------------------------------------------------------------------
Class B --- assuming redemption at end of period
-----------------------------------------------------------------------------------
Year 1 $719 $606
-----------------------------------------------------------------------------------
Year 3 $976 $937
-----------------------------------------------------------------------------------
Year 5 $1,359 $1,193
-----------------------------------------------------------------------------------
Year 10 $2,300 $2,137
-----------------------------------------------------------------------------------
Class B --- assuming no redemption
-----------------------------------------------------------------------------------
Year 1 $219 $206
-----------------------------------------------------------------------------------
Year 3 $676 $637
-----------------------------------------------------------------------------------
Year 5 $1,159 $1,093
-----------------------------------------------------------------------------------
Year 10 $2,300 $2,137
-----------------------------------------------------------------------------------
Class I Class Y
-----------------------------------------------------------------------------------
Year 1 $128 $81
-----------------------------------------------------------------------------------
Year 3 $400 $252
-----------------------------------------------------------------------------------
Year 5 $692 $439
-----------------------------------------------------------------------------------
Year 10 $1,523 $978
-----------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of Amsouth Select Equity Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, and AmSouth Bank informed the Trustees that they did not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer
family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges. In addition, Pioneer offers shareholders additional options for their accounts, including the ability to transact and exchange shares over the telephone or online and the ability to access account values and transaction history in all of the shareholder's direct accounts in the Pioneer Funds over the telephone or online.
Third, Pioneer Focused Equity Fund's management fee (0.65% of average daily net assets up to $1 billion, and 0.60% on assets greater than $1 billion) will be substantially lower than the advisory fee of your AmSouth Fund (0.80% of average daily net assets). The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds will be the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that will not be paid by the Pioneer Fund's Class Y shares. On a pro forma basis, the estimated expense ratio of each class of shares of the Pioneer Fund is estimated to be lower than the expense ratio of the corresponding class of your AmSouth Fund. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Fourth, the Class A, B and Y shares of Pioneer Focused Equity Fund received in the Reorganization will provide AmSouth Select Equity Fund shareholders with exposure to substantially the same investment product as they currently have.
Fifth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
--------------------------------------------------------------------------------------------------------------
Pioneer
Focused Equity
AmSouth Select Fund
Equity Fund Pioneer Focused (Pro Forma)
May 31, 2005 Equity Fund May 31, 2005
--------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $128,657 N/A $128,657
--------------------------------------------------------------------------------------------------------------
Class A shares ................................... $20,736 N/A $20,736
--------------------------------------------------------------------------------------------------------------
Class B shares ................................... $17,590 N/A $17,590
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $90,331 N/A $90,331
--------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share N/A
--------------------------------------------------------------------------------------------------------------
Class A shares ................................... $14.14 N/A $14.14
--------------------------------------------------------------------------------------------------------------
Class B shares ................................... $13.68 N/A $13.68
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. $14.21 N/A $14.21
--------------------------------------------------------------------------------------------------------------
Shares Outstanding
--------------------------------------------------------------------------------------------------------------
Class A shares ................................... 1,466,769 N/A 1,466,769
--------------------------------------------------------------------------------------------------------------
Class B shares ................................... 1,285,404 N/A 1,285,404
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ................................. 6,358,281 N/A 6,358,281
--------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Balanced Fund and Pioneer Classic Balanced Fund
PROPOSAL 1(i)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-2, because it contains details that are not in the summary.
Each Fund has an investment objective of obtaining capital growth and current income and, consequently, the Funds have similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Balanced Fund to Pioneer Classic Balanced Fund
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A newly created diversified series of Pioneer
open-end management investment company series Trust IV, an open-end management
organized as a Massachusetts business trust. investment company organized as a Delaware
statutory trust.
Net assets as of March 31, $182.74 million None. Pioneer Classic Balanced Fund is newly
2005 created and does not expect to commence
investment operations until the Reorganization
occurs.
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Managers: Portfolio Managers:
Day-to-day management of AmSouth Balanced Day-to-day management of the Fund's portfolio
Fund's portfolio is the responsibility of John is the responsibility of John A. Carey,
P. Boston, CFA, and Brian B. Sullivan, CFA Mr. portfolio manager, and Walter Hunnewell, Jr.,
Boston has co-managed the Balanced Fund since assistant portfolio manager. Mr. Carey and Mr.
1994. Mr. Sullivan has co-managed the Balanced Hunnewell are supported by the domestic equity
Fund since June 2004. Mr. Sullivan has been an team. Members of this team manage other
officer of AAMI since 1996 and joined AmSouth Pioneer mutual funds investing primarily in
Bank in 1982. Prior to serving as Director of U.S. equity securities. The portfolio managers
Fixed Income for AmSouth Bank's Trust and the team also draw upon the research and
Department, Mr. Sullivan managed equity investment management expertise of the global
portfolios and held the position of equity research team, which provides fundamental
research coordinator for AmSouth Bank's Trust research on companies and includes members
Department. Mr. Boston is Chief Fixed Income from Pioneer's affiliate, Pioneer Investment
Officer for AmSouth Asset Management, Inc. Mr. Management Limited.
Boston began his career in investment
management with AmSouth Bank in 1988 and has Mr. Carey is director of portfolio management
been associated with AAMI since 1996. and an executive vice president of Pioneer.
Mr. Carey joined Pioneer as an analyst in
1979. Mr. Hunnewell is a vice president of
Pioneer. He joined Pioneer in August 2001 and
has been an investment professional since
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
1985. Prior to joining Pioneer, Mr. Hunnewell
was an independent investment manager and a
fiduciary of private asset portfolios from
2000 to 2001.
Investment objective AmSouth Balanced Fund seeks to obtain Pioneer Classic Balanced Fund seeks to obtain
long-term capital growth and produce a capital growth and current income.
reasonable amount of current income through a
moderately aggressive investment strategy.
Primary investments AmSouth Balanced Fund invests in a broadly Pioneer allocates the Fund's assets between
diversified portfolio of equity and debt equity and debt securities based on its
securities consisting primarily of common assessment of current business, economic and
stocks and bonds. market conditions. Normally, equity and debt
securities each represent 35% to 65% of the
The Fund normally invests between 45-75% of Fund's assets.
its assets in equity securities and at least
25% of its assets in fixed income securities. For purposes of the Fund's investment
The portion of the Fund's assets invested in policies, equity investments include common
equity and debt securities will vary depending stocks, convertible debt, equity interests in
upon economic conditions, the general level of real estate investment trusts (REITs), and
stock prices, interest rates and other securities with common stock characteristics,
factors, including the risks associated with such as preferred stocks. The Fund's
each investment. The Fund's equity investments investments in debt securities include U.S.
consist primarily of common stocks of government securities, corporate debt
companies that AAMI believes are undervalued securities, mortgage- and asset-backed
and have a favorable outlook or are reasonably securities, short-term debt securities, cash
priced with the potential to produce and cash equivalents. Cash and cash
above-average earnings growth. The Fund's equivalents include cash balances, accrued
fixed-income investments consist primarily of interest and receivables for items such as the
"high-grade" bonds, notes and debentures. The proceeds, not yet received, from the sale of
Fund invests in securities issued by: (i) the the Fund's portfolio investments. Debt
Government National Mortgage Association securities in which the Fund invests may have
("GNMA"), which are supported by the full fixed or variable principal payments and all
faith and credit of the U.S. government; and types of interest rate payment and reset
(ii) the Federal National Mortgage Association terms, including fixed rate, adjustable rate,
("FNMA") and the Federal Home Loan Mortgage zero coupon, contingent, deferred,
Corporation ("FHLMC") which are supported by payment-in-kind and auction rate features.
the right of the issuer to borrow from the
U.S. Treasury. The Fund also invests in U.S. The Fund may invest in U.S. government
Treasury obligations. securities. U.S. government securities include
obligations: directly issued by or supported
by the full faith and credit of the U.S.
government, like Treasury bills, notes and
bonds and Government National Mortgage
Association certificates; supported by the
right of the issuer to borrow from the U.S.
Treasury, like those of the Federal Home Loan
Banks; supported by the discretionary
authority of the U.S. government to purchase
the agency's securities like those of the
Federal National Mortgage Association; or
supported only by the credit of the issuer
itself, like the Tennessee Valley Authority.
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
The Fund may invest in mortgage-backed and
asset-backed securities. Mortgage-related
securities may be issued by private companies
or by agencies of the U.S. government and
represent direct or indirect participation in,
or are collateralized by and payable from,
mortgage loans secured by real property.
Asset-backed securities represent
participations in, or are secured by and
payable from, assets such as installment sales
or loan contracts, leases, credit card
receivables and other categories of
receivables.
Investment strategies In managing the equity portion of the Fund, In selecting equity securities, Pioneer uses a
the AAMI combines fundamental and quantitative value approach to select the Fund's
analysis with risk management to identify investments. Pioneer seeks securities selling
value opportunities, construct the portfolio at reasonable prices or substantial discounts
and make sell decisions. AAMI selects to their underlying values and then holds
investments believed to have basic investment these securities until the market values
value that will eventually be recognized by reflect their intrinsic values. Pioneer
other investors. In addition, the AAMI may evaluates a security's potential value,
identify companies with a history of including the attractiveness of its market
above-average growth or companies that are valuation, based on the company's assets and
expected to enter periods of above-average prospects for earnings growth. In making that
growth or are positioned in emerging growth assessment, Pioneer employs due diligence and
industries. fundamental research, an evaluation of the
issuer based on its financial statements and
AAMI's fixed income portfolio management operations. Pioneer also considers a
process focuses on the four key areas of security's potential to provide a reasonable
duration management, sector weights, position amount of income. Pioneer relies on the
on the yield curve, and security selection; knowledge, experience and judgment of its
AAMI's goal is to add value in each of staff who have access to a wide variety of
these four areas through the active management research. Pioneer focuses on the quality and
of the Fund's portfolio. Beginning with price of individual issuers, not on economic
rigorous fundamental analysis of the economy sector or market-timing strategies. Factors
and taking into account characteristics of the Pioneer looks for in selecting investments
current business and interest rate cycles, include:
AAMI arrives at a projection of the likely
trend in interest rates and adjusts duration o Favorable expected returns relative
accordingly. Analysis of the shape of the to perceived risk
yield curve and yield spreads among bond o Above average potential for earnings
market sectors leads to further refinements in and revenue growth
strategy for companies that appear o Low market valuations relative to
undervalued. earnings forecast, book value, cash flow
and sales
o A sustainable competitive advantage,
such as a brand name, customer base,
proprietary technology or economies of
scale
In selecting debt securities, Pioneer
considers both broad economic and issuer
specific factors in selecting a portfolio
designed to achieve the Fund's investment
objectives. In assessing the appropriate
maturity, rating and
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
sector weighting of the Fund's portfolio,
Pioneer considers a variety of factors that are
expected to influence economic activity and
interest rates. These factors include
fundamental economic indicators, such as the
rates of economic growth and inflation, Federal
Reserve monetary policy and the relative value
of the U.S. dollar compared to other
currencies. Once Pioneer determines the
preferable portfolio characteristics, Pioneer
selects individual securities based upon the
terms of the securities (such as yields
compared to U.S. Treasuries or comparable
issuers), liquidity and rating, sector and
issuer diversification.
Other investments The Fund may also invest in debt securities, Up to 10% of the Fund's total assets may be
preferred stock and that portion of the value invested in debt securities rated below
of securities convertible in to common stock, investment grade, including convertible debt.
including convertible preferred stock and A debt security is investment grade if it is
convertible debt, which is attributable to the rated in one of the top four categories by a
fixed income characteristics of those nationally recognized statistical rating
securities. organization or determined to be of equivalent
credit quality by Pioneer. Debt securities
rated below investment grade are commonly
referred to as "junk bonds" and are considered
speculative. Below investment grade debt
securities involve greater risk of loss, are
subject to greater price volatility and are
less liquid, especially during periods of
economic uncertainty or change, than higher
quality debt securities.
The Fund may invest up to 25% of its total
assets in real estate investment trusts
(REITs). REITs are companies that invest
primarily in real estate or real estate
related loans.
The Fund may invest up to 25% of its total
assets in equity and debt securities of
non-U.S. issuers. The Fund will not invest
more than 5% of its total assets in the
securities of emerging markets issuers. The
Fund invests in non-U.S. securities to
diversify its portfolio when they offer
similar or greater potential for capital
appreciation.
Temporary defensive When AAMI determines adverse market conditions Normally, Pioneer Classic Balanced Fund
strategies exist, AmSouth Balanced Fund may invest invests substantially all of its assets to
entirely in cash positions, directly in U.S. meet its investment objective. The Fund may
Government securities and short-term paper, invest the remainder of its assets in
such as bankers' acceptances. securities with remaining maturities of less
than one year, cash equivalents or may hold
cash. For temporary defensive purposes,
including
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
during periods of unusual cash flows, the Fund
may depart from its principal investment
strategies and invest part or all of its assets
in these securities or may hold cash. During
such periods, the Fund may not be able to
achieve its investment objective. The Fund
intends to adopt a defensive strategy when
Pioneer believes securities in which the Fund
normally invests have extraordinary risks due
to political or economic factors and in other
extraordinary circumstances.
Diversification Each Fund is diversified for the purpose of the Investment Company Act and is subject to
diversification requirements under the Internal Revenue Code of 1986, as amended (the "Code").
Industry concentration AmSouth Balanced Fund may not purchase any Pioneer Classic Balanced Fund may not invest
securities which would cause more than 25% of more than 25% of its assets in any one
the value of the Fund's total assets at the industry.
time of purchase to be invested in securities
of one or more issuers conducting their
principal business activities in the same
industry, provided that (a) there is no
limitation with respect to obligations issued
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the
U.S. government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their
activities are primarily related to financing
the activities of their parents; and
(c) utilities will be divided according to
their services. For example, gas, gas
transmission, electric and gas, electric, and
telephone will each be considered a separate
industry.
Restricted and illiquid AmSouth Balanced Fund may not invest more than Pioneer Classic Balanced Fund may not invest
securities 15% of its net assets in securities that are more than 15% of its net assets in securities
restricted as to resale, or for which no that are illiquid and other securities that
readily available market exists, including are not readily marketable. Repurchase
repurchase agreements providing for settlement agreements maturing in more than seven days
more than seven days after notice. will be included for purposes of the foregoing
limit.
Borrowing AmSouth Balanced Fund may not borrow money or Pioneer Classic Balanced Fund may not borrow
issue senior securities, except that the Fund money, except the Fund may: (a) borrow from
may borrow from banks or enter into reverse banks or through reverse repurchase agreements
repurchase agreements for temporary emergency in an amount up to 33 1/3% of the Fund's total
purposes in amounts up to 33 1/3% of the value assets (including the amount borrowed); (b) to
of its total assets at the time of such the extent permitted by applicable law, borrow
borrowing. The Fund will not purchase up to an additional 5% of the Fund's assets
securities while borrowings (including reverse for temporary purposes; (c) obtain such
repurchase agreements) in excess of 5% of its short-term credits as are necessary for the
total assets are outstanding. clearance of portfolio
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
transactions; (d) purchase securities on margin
to the extent permitted by applicable law; and
(e) engage in transactions in mortgage dollar
rolls that are accounted for as financings.
Lending AmSouth Balanced Fund may not make loans, Pioneer Classic Balanced Fund may not make
except that the Fund may purchase or hold debt loans, except that the Fund may (i) lend
instruments in accordance with its investment portfolio securities in accordance with the
objective and policies, lend Fund securities Fund's investment policies, (ii) enter into
in accordance with its investment objective repurchase agreements, (iii) purchase all or a
and policies and enter into repurchase portion of an issue of publicly distributed
agreements. debt securities, bank loan participation
interests, bank certificates of deposit,
In addition, the Fund is permitted to bankers' acceptances, debentures or other
participate in a credit facility whereby the securities, whether or not the purchase is
Fund may directly lend to and borrow money made upon the original issuance of the
from other AmSouth funds for temporary securities, (iv) participate in a credit
purposes, provided that the loans are made in facility whereby the Fund may directly lend to
accordance with an order of exemption from the and borrow money from other affiliated funds
SEC and any conditions thereto. to the extent permitted under the Investment
Company Act or an exemption therefrom, and (v)
make loans in any other manner consistent with
applicable law, as amended and interpreted or
modified from time to time by any regulatory
authority having jurisdiction.
Derivative instruments AmSouth Balanced Fund may invest in futures The Fund may use futures and options on
contracts and options thereon (interest rate securities, indices and currencies, forward
futures contracts or index futures contracts, foreign currency exchange contracts and other
as applicable) to commit funds awaiting derivatives. A derivative is a security or
investment, to maintain cash liquidity or for instrument whose value is determined by
other hedging purposes. The value of the reference to the value or the change in value
Fund's contracts may equal or exceed 100% of of one or more securities, currencies, indices
the Fund's total assets, although the Fund or other financial instruments. Although there
will not purchase or sell a futures contract is no specific limitation on investing in
unless immediately afterwards the aggregate derivatives, the Fund does not use derivatives
amount of margin deposits on its existing as a primary investment technique and
futures positions plus the amount of premiums generally limits their use to hedging.
paid for related futures options entered into However, the Fund may use derivatives for a
for other than bona fide hedging purposes is variety of non-principal purposes, including:
5% or less of its net assets.
o As a hedge against adverse changes in
stock market prices, interest rates or
currency exchange rates
o As a substitute for purchasing or
selling securities
o To increase the Fund's return as a
non-hedging strategy that may be
considered speculative
Even a small investment in derivatives can
have a significant impact on the Fund's
exposure to stock market values, interest
rates or currency exchange rates. If changes
in a derivative's value do not correspond to
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
changes in the value of the Fund's other
investments, the Fund may not fully benefit
from or could lose money on the derivative
position. In addition, some derivatives
involve risk of loss if the person who issued
the derivative defaults on its obligation.
Certain derivatives may be less liquid and
more difficult to value. The Fund will only
invest in derivatives to the extent Pioneer
believes these investments do not prevent the
Fund from seeking its investment objective.
Short-term trading The AmSouth Fund may engage in the technique The Fund usually does not trade for short-term
of short-term trading. Such trading involves profits. The Fund will sell an investment,
the selling of securities held for a short however, even if it has only been held for a
time, ranging from several months to less than short time, if it no longer meets the Fund's
a day. The object of such short-term trading investment criteria.
is to increase the potential for capital
appreciation and/or income of the Fund in
order to take advantage of what AAMI believes
are changes in market, industry or individual
company conditions or outlook.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 4% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge is
(non 12b-1) of up to 0.25% waived.
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares held continuously, to 4% if you sell your shares. The charge is
the CDSC declines over six years, starting reduced over time and is not charged after
with year one and ending in year seven from: five years. Your investment firm may receive a
5%, 4%, 3%, 2%, 1%. Eight years after purchase commission from PFD, the Fund's distributor,
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
Class B shares automatically convert to Class at the time of your purchase of up to 4%.
A shares.
Class B shares are subject to distribution and
Class B shares pay a shareholder servicing fee service (12b-1) fees of up to 1% of average
(non 12b-1) of up to 0.25% of average daily daily net assets.
net assets. This fee is in the form of a
separate non-Rule 12b-1 fee. All Funds bear a Class B shares acquired through the
distribution (12b-1) fee of up to 0.75%. Reorganization will be subject to the CDSC and
commission schedules applicable to the
Maximum investment for all Class B purchases original purchase.
by a shareholder for the Fund's shares is
$99,999. Maximum purchase of Class B shares in a single
transaction is $49,999.
Class I and Class Y sales AmSouth Balanced Fund does not impose any The Fund does not impose any initial,
charges and Rule 12b-1 fees initial or CDSC on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. The fee is computed daily distributing the Fund's Class Y shares, none
and paid monthly. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth Balanced Fund pays an advisory fee on Pioneer Classic Balanced Fund will pay Pioneer
a monthly basis at an annual rate of 0.80% of an advisory fee as follows: 0.65% of the
the Fund's average daily net assets. Fund's average daily net assets on the first
$1 billion, 0.60% on the next $4 billion, and
ASO Services Company, Inc. ("ASO") serves as 0.55% on assets over $5 billion. The fee is
administrator and fund accounting agent for computed daily and paid monthly.
the Fund. The Fund pays ASO an administrative
services fee of 0.15% of the Fund's average In addition, the Fund will reimburse Pioneer
daily net assets. for certain fund accounting and legal expenses
incurred on behalf of the Fund and pay a
Other expenses of the Fund are being limited separate shareholder servicing/transfer agency
to 0.54% for Class A shares, 0.54% for Class B fee to PIMSS, an affiliate of Pioneer.
shares and 0.44% for Class I shares. Any fee
waiver or expense reimbursement arrangement is The Fund's total annual fund operating
voluntary and may be discontinued at any time. expenses are estimated to be 1.13% of average
daily net assets for Class A shares, 1.99% for
For the fiscal year ended July 31, 2004, the Class B shares, and 0.78% for Class Y shares
Fund's annual operating expenses for Class A for the current fiscal year.
shares, after giving effect to the expense
limitation were 1.32%, and without giving
effect to the expense limitation, were 1.34%
of average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class B
shares, after giving effect to the expense
limitation were 2.07%, and without giving
effect to the expense limitation, were 2.09%
of
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 1.17%, and without giving
effect to the expense limitation, were 1.21%
of average daily net assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of Pioneer Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. The Fund allows you to exchange your
requirements for the Fund into which you are shares at net asset value without charging you
exchanging. Exchanges from one Fund to another either an initial or contingent deferred
are taxable. Class A shares may be exchanged shares charge at the time of the exchange.
for Class I shares of the same Fund or another Shares you acquire as part of an exchange will
AmSouth fund if you become eligible to continue to be subject to any contingent
purchase Class I shares. Class I shares may be deferred sales charge that applies to the
exchanged for Class A shares of the same Fund. shares you originally purchased. When you
No transaction fees are currently charged for ultimately sell your shares, the date of your
exchanges. original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 purchase of shares for federal income tax
days of the date of purchase, you will be purposes.
charged a 2.00% fee on the current net asset
value of the shares sold or exchanged. The fee After you establish an eligible fund account,
is paid to the Fund to offset the costs you can exchange Fund shares by telephone or
associated with short-term trading, such as online.
portfolio transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares purchased
first will be considered redeemed first for
purposes of determining whether the redemption
fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
|
AmSouth Balanced Fund Pioneer Classic Balanced Fund
-----------------------------------------------------------------------------------------------------------------------------
other types of omnibus accounts (except where
it is not practical for the plan administrator
or brokerage firm to implement the fee). The
Fund will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The stock market goes down (this risk may be greater in the short term)
o The adviser's judgment about the attractiveness, growth potential or potential appreciation of a particular stock proves to be incorrect
o The market segment on which the Fund equity investment are focused - value and growth stocks - under performs other kinds of investments or market averages
o The value of the Fund's fixed-income investments declines due to an increase in interest rates (generally, an increase in the average maturity of the fixed income portfolio of the Fund will make it more sensitive to interest rate risk)
o During periods of declining interest rates, the issuer of a security may exercise its option to prepay principal earlier than scheduled, forcing the Fund to reinvest in lower yielding securities. This is known as call or prepayment risk
o During periods of rising interest rates, the average life of certain types of securities may be extended because of slower than expected principal payments. This may lock in a below market interest rate, increase the security's duration (the estimated period until the security is paid in full) and reduce the value of the security. This is known as extension risk
o An issuer cannot make timely interest and principal payments on its debt securities, such as bonds (the lower a security's rating, the greater its credit risk)
Each Fund may trade securities actively to achieve its principal investment strategies. Active trading of portfolio securities could increase each Fund's transaction costs (thereby lowering its performance) and may increase the amount of taxes that you pay (on distributions of net gains realized on those trades).
If either Fund invests in securities with additional risk, that Fund's share price volatility accordingly could be greater and its performance lower.
At times, more than 25% of the Fund's assets may be invested in the same market segment, such as financials or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a Fund without the same focus. For example, industries in the financial segment, such as banks, insurance companies, broker-dealers and REITs, may be sensitive to changes in interest rates and general economic activity and are subject to extensive government regulation. Industries in the technology segment, such as information technology, communications equipment, computer hardware and software, and office and scientific equipment, are subject to risks of rapidly evolving technology, short product lives, rates of corporate expenditures, falling prices and profits, competition from new market entrants, and general economic conditions.
If the Fund does a lot of trading, it may incur additional operating expenses, which would reduce performance, and could cause shareowners to incur a higher level of taxable income or capital gains.
Pioneer Classic Balanced Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. Some of these risks do not apply to larger, more developed non-U.S. countries. However, these risks are more pronounced for issuers of securities in emerging markets. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, Pioneer may not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
Past Performance
Set forth below is performance information for AmSouth Balanced Fund. The bar charts show how AmSouth Balanced Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return for AmSouth Balanced Fund over time for each class of shares compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in AmSouth Balanced Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance does not indicate future results. Pioneer Classic Balanced Fund has not commenced investment operations.
AmSouth Balanced Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 23.51% 1996 9.72 1997 20.84 1998 13.12 1999 1.33 2000 10.18 2001 4.04 2002 -6.86 2003 15.69 2004 7.60 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 10.62% for the quarter ended June 30, 2003, and the lowest quarterly return was -6.78% for the quarter ended September 30, 2002.
AmSouth Balanced Fund Average Annual Total Returns (as of December 31, 2004)
1 Year 5 Years 10 Years
--------------------------------------------------------------------------------------------------------------------------
AmSouth Balanced Fund, Class A Shares
--------------------------------------------------------------------------------------------------------------------------
Return Before Taxes(1) 1.68% 4.79% 9.02%
--------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 0.89% 3.23% 6.71%
--------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 1.07% 3.29% 6.64%
--------------------------------------------------------------------------------------------------------------------------
AmSouth Balanced Fund, Class B Shares
--------------------------------------------------------------------------------------------------------------------------
Return Before Taxes(1) 1.86% 4.87% 8.75%
--------------------------------------------------------------------------------------------------------------------------
AmSouth Balanced Fund, Class I Shares(2)
--------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 7.76% 6.15% 9.78%
--------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 6.88% 4.46% 7.38%
--------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 5.02% 4.38% 7.27%
--------------------------------------------------------------------------------------------------------------------------
S&P 500 Index 10.87% -2.30% 12.07%
--------------------------------------------------------------------------------------------------------------------------
Lehman Government/Credit Bond Index 4.19% 8.00% 7.80%
--------------------------------------------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 12/19/91. Performance for the Class B shares, which were first offered on 9/2/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the contingent deferred sales charge.
(2) Performance for the Class I shares, which were first offered on 9/1/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date.
The table shows the impact of taxes on the Fund's returns. After-tax returns are only shown for Class A shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
The most recent portfolio manager's discussion of AmSouth Balanced Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The table below shows the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the table appearing below are based on (i) for the AmSouth Balanced Fund, the expenses of AmSouth Balanced Fund for the period ended January 31, 2005 and (ii) for the Pioneer Classic Balanced Fund, the estimated pro forma annual expenses assuming the Reorganization occurred on May 31, 2005.
Shareholder AmSouth Balanced Pioneer Classic AmSouth Balanced Pioneer Classic AmSouth Balanced Pioneer Classic
transaction Fund(1) Balanced Fund Fund(1) Balanced Fund Fund(1) Balanced Fund
fees (paid (Pro Forma) (Pro Forma) (Pro Forma)
directly from
your
investment) Class A Class A Class B Class B Class I Class Y
---------------------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75%(2) None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
---------------------------------------------------------------------------------------------------------------------------------
Maximum None None 5.00%(3) 4.00% None None
deferred sales
charge (load)
as a percentage
of purchase
price or the
amount you
receive when
you sell
shares,
whichever is
less
---------------------------------------------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) None 2.00%(4) None 2.00%(4) None
---------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
---------------------------------------------------------------------------------------------------------------------------------
Management fee 0.80% 0.65% 0.80% 0.65% 0.80% 0.65%
---------------------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.75% 1.00% None None
and service
(12b-1) fee
---------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.60%(5) 0.23% 0.63%(5) 0.34% 0.50%(5) 0.13%
---------------------------------------------------------------------------------------------------------------------------------
Total fund 1.40% 1.13%(6) 2.18% 1.99%(6) 1.30% 0.78%(6)
operating
expenses
---------------------------------------------------------------------------------------------------------------------------------
Expense 0.07% 0.09% 0.10% N/A 0.12% N/A
reimbursement/
reduction
---------------------------------------------------------------------------------------------------------------------------------
Net fund 1.33% 1.13% 2.08% 1.99% 1.18% 0.78%
operating
expenses
---------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) A CDCS on Class B shares held continuously declines over six years starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.53% for Class A shares, 0.53% for Class B shares and 0.38% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, (d) each Fund's gross operating expenses remain the same, and (e) the expense limitation for your Fund is in effect for year one. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Pro Forma
Number of years you Pioneer Classic Balanced
own your shares AmSouth Balanced Fund Fund
---------------------------------------------------------------------------------
Class A
---------------------------------------------------------------------------------
Year 1 $ 685 $ 684
---------------------------------------------------------------------------------
Year 3 $ 969 $ 913
---------------------------------------------------------------------------------
Year 5 $ 1,274 $ 1,161
---------------------------------------------------------------------------------
Year 10 $ 2,137 $ 1,871
---------------------------------------------------------------------------------
Class B --- assuming redemption at end of period
---------------------------------------------------------------------------------
Year 1 $ 721 $ 602
---------------------------------------------------------------------------------
Year 3 $ 982 $ 924
---------------------------------------------------------------------------------
Year 5 $ 1,369 $ 1,173
---------------------------------------------------------------------------------
Year 10 $ 2,316 $ 2,095
---------------------------------------------------------------------------------
Class B --- assuming no redemption
---------------------------------------------------------------------------------
Year 1 $ 221 $ 202
---------------------------------------------------------------------------------
Year 3 $ 682 $ 624
---------------------------------------------------------------------------------
Year 5 $ 1,169 $ 1,073
---------------------------------------------------------------------------------
Year 10 $ 2,316 $ 2,095
---------------------------------------------------------------------------------
Class I Class Y
---------------------------------------------------------------------------------
Year 1 $ 132 $ 80
---------------------------------------------------------------------------------
Year 3 $ 412 $ 249
---------------------------------------------------------------------------------
Year 5 $ 713 $ 433
---------------------------------------------------------------------------------
Year 10 $ 1,568 $ 966
---------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of Amsouth Balanced Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, and AmSouth Bank informed the Trustees that they did not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate
shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges. In addition, Pioneer offers shareholders additional options for their accounts, including the ability to transact and exchange shares over the telephone or online and the ability to access account values and transaction history in all of the shareholder's direct accounts in the Pioneer Funds over the telephone or online.
Third, Pioneer Classic Balanced Fund's management fee (0.65% of average daily net assets on the first $1 billion, 0.60% on the next $4 billion, and 0.55% on assets over $5 billion) will be substantially lower than the advisory fee of your Fund (0.80% of average daily net assets). The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds will be the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that will not be paid by the Pioneer Fund's Class Y shares. On a pro forma basis, both the gross and net expenses of each class of the Pioneer Fund are estimated to be lower than the expenses of the corresponding class of your AmSouth Fund. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduce per share expenses.
Fourth, the Class A, B and Y shares of Pioneer Classic Balanced Fund received in the Reorganization will provide AmSouth Balanced Fund shareholders with exposure to substantially the same investment product as they currently have.
Fifth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
(Pro Forma)
AmSouth Balanced Pioneer Classic Pioneer Classic
Fund Balanced Fund Balanced Fund
May 31, 2005 May 31, 2005 May 31, 2005
---------------- --------------- --------------
Total Net Assets (in thousands) $ 181,569 N/A $ 181,569
Class A shares........................................... $ 105,281 N/A $ 105,281
Class B shares .......................................... $ 25,044 N/A $ 25,044
Class I/Y shares ........................................ $ 51,244 N/A $ 51,244
|
Net Asset Value Per Share Class A shares .......................................... $ 12.74 N/A $ 12.74 Class B shares .......................................... $ 12.69 N/A $ 12.69 Class I/Y shares ........................................ $ 12.74 N/A $ 12.74 Shares Outstanding Class A shares .......................................... 8,265,238 N/A 8,265,238 Class B shares .......................................... 1,973,093 N/A 1,973,093 Class I/Y shares ........................................ 4,022,510 N/A 4,022,510 |
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Strategic Portfolios: Aggressive Growth Portfolio and Pioneer Ibbotson Aggressive Allocation Fund
PROPOSAL 1(j)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund is structured as a "fund of funds," which means all of its assets are invested in other mutual funds ("underlying funds"). Your Fund invests only in other AmSouth funds. Currently, the Pioneer Fund only invests in other Pioneer Funds but is seeking an exemptive order from the Securities and Exchange Commission that would permit the Pioneer Fund to invest, in addition, in mutual funds that are not managed by Pioneer. To the extent Pioneer receives an order from the Securities and Exchange Commission that permits Pioneer to invest in such other non-Pioneer underlying funds, Pioneer and the Pioneer Fund intend to rely on such order, subject to any applicable conditions of the order. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Strategic Portfolios: Aggressive Growth Portfolio to Pioneer Ibbotson Aggressive Allocation Fund
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A series of Pioneer Ibbotson Asset Allocation
open-end management investment company Series, a diversified open-end management
organized as a Massachusetts business trust. investment company organized as a Delaware
statutory trust.
Net assets as of March $51.9 million $19.1 million
31, 2005
Investment advisers Investment Adviser: Investment Adviser:
and portfolio AAMI Pioneer
managers
Portfolio Manager: Investment Subadviser:
Day-to-day management of AmSouth Strategic Ibbotson Associates Advisors, LLC
Portfolios: Aggressive Growth Portfolio is the ("Ibbotson")
responsibility of the AmSouth Strategy
Committee, and no person is primarily Portfolio Managers:
responsible for making recommendations to the Day-to-day management of Pioneer Ibbotson
Committee. The Committee members consist Aggressive Allocation Fund is the
of John Boston, CFA, Fred Crown, CFA, Paige responsibility of portfolio managers and
B. Daniel, David M. Dasari, CFA, Joseph T. members of Ibbotson's Investment Committee
Keating, Ronald E. Lindquist, John Mark headed by Roger Ibbotson. Roger Ibbotson
McKenzie, Matt Smith, CFA, Brian B. founded Ibbotson in 1977 and is the firm's
Sullivan, CFA, Doug S. Williams and Jason Chairman. Peng Chen, Ph.D., managing
Waters. director and chief investment officer at
Ibbotson, conducts research projects on asset
Mr. Boston is Chief Fixed Income Officer for allocation, portfolio risk measurement,
AAMI. He began his career in investment nontraditional assets, and global financial
management with AmSouth Bank in 1987 and markets. Dr. Chen joined Ibbotson in 1997.
has been associated with AAMI since 1996. Michael E. Annin, managing director,
Mr. Boston received his CFA charter in 1993 manages the investment management services
and is an active member and past president of and data products group for Ibbotson. Scott
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
the Alabama Society of Financial Analysts. He Wentsel, senior portfolio manager, is
also serves as the portfolio manager for the responsible for management of the firm's
AmSouth High Quality Bond Fund. Mr. Boston fund-of-funds business which includes
is a Senior Vice President of AmSouth Bank oversight of its investment management staff
and Vice President of AAMI. and process. Alexander E. Kaye, portfolio
manager, is responsible for managing the
Mr. Crown has been employed with AmSouth delivery of fund-of-funds programs for
Bank since 1982 and AAMI since 2001. He institutional and retail clients, which includes
was an Institutional Fund Manager with AAMI asset allocation modeling, portfolio
(2001-2003) and has been a Regional Manager construction, fund classification and manager
since 2003. Mr. Crown is a Senior Vice due diligence. Brian Huckstep, portfolio
President of AmSouth Bank. manager, is responsible for managing the
delivery of fund-of-funds programs for
Ms. Daniel has been employed with AmSouth institutional and retail clients, which includes
Bank since 1999. She has been employed by asset allocation modeling, portfolio
AAMI as the Director of Alternative Strategies construction, fund classification, and manager
since 2003. She is an Assistant Vice President due diligence.
with AmSouth Bank.
Mr. Dasari has been employed with AmSouth
Bank since 2002 and AAMI since 2003. He is
Director of Individual Security Management
for AAMI. Prior to joining AmSouth Bank, he
was Assistant Vice President at Fifth Third
Bank. Mr. Dasari is a Vice President of
AmSouth Bank.
Mr. Keating has been employed with AmSouth
Bank since 2001 and AAMI since 2002. He is
the Chairman and Chief Investment Officer of
AAMI. Prior to 2001, he was employed as the
Chief Market Strategist and Chief Fixed
Income Officer of Fifth Third Bank. Mr.
Keating is an Executive Vice-President of
AmSouth Bank.
Mr. Lindquist has been employed with AAMI
since December 1999. Prior to December 1999,
Mr. Lindquist was employed by First American
National Bank (since May 1998), and by
Deposit Guaranty National Bank, and
Commercial National Bank (since 1978). First
American National Bank, Deposit Guaranty
National Bank and Commercial National Bank
are predecessors of AmSouth Bank and
affiliates of AAMI. He also serves as the
portfolio manager for the AmSouth Large Cap
Fund. Mr. Lindquist is a Senior Vice President
of AmSouth Bank and Vice President of
AAMI.
Mr. McKenzie has been involved in investment
management since 1981, with portfolio
management expertise in both equity and fixed
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
income securities. Mr. McKenzie co-managed
the AmSouth Government Income Fund from
1999 to 2002 and managed it from 2003 to
2004. Mr. McKenzie has been associated with
the Trust Investment Department of AmSouth
Bank, and banks acquired by AmSouth Bank,
since 1984 and joined AAMI in 2003. Mr.
McKenzie is a Senior Vice President of
AmSouth Bank and Vice President of AAMI.
Mr. Smith has been employed with AmSouth
Bank since 1988. He has been employed by
AAMI as a Regional Manager since 2004. He
is a Senior Vice President with AmSouth Bank.
Mr. Sullivan has been an officer of AAMI
since 1996 and joined AmSouth Bank in 1984.
Prior to serving as Director of Fixed Income for
AmSouth Bank's Trust Department, Mr.
Sullivan managed equity portfolios and held
the position of equity research coordinator for
AmSouth Bank's Trust Department. Mr.
Sullivan is a Senior Vice President of AmSouth
Bank and Vice President of AAMI.
Mr. Waters has been employed with AmSouth
Bank since 1999. He has been employed as an
Institutional Portfolio Manager with AAMI
since 2001. Mr. Williams is a Senior Vice
President of AmSouth Bank.
Mr. Williams has been employed with
AmSouth Bank since 2002. He has been
employed as a Regional Manager with AAMI
since 2004. Prior to 2002, Mr. Williams was a
Director of Portfolio Management with Fifth
Third Bank (1988-2002). Mr. Williams is a
Senior Vice President of AmSouth Bank.
Investment objective AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation Fund
Growth Portfolio seeks to provide investors seeks long-term capital growth.
with capital growth.
Primary investments Each Fund allocates its investments among underlying funds within pre-determined strategy
ranges.
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Aggressive Growth Portfolio:
AmSouth Strategic Portfolios: Aggressive Growth Portfolio allocates its assets among the
following underlying funds within the ranges set forth below based upon AAMI's outlook for the
economy, financial markets and relative market valuations of the underlying AmSouth Funds.
Underlying Fund Allocation Range
AmSouth Value Fund 0-20%
AmSouth Select Equity Fund 0-15%
AmSouth Enhanced Market Fund 0-25%
AmSouth Large Cap Fund 0-15%
AmSouth Capital Growth Fund 0-20%
AmSouth Mid Cap Fund 0-15%
AmSouth Small Cap Fund 0-25%
AmSouth International Equity Fund 0-15%
AmSouth High Quality Bond Fund 0-35%
AmSouth Limited Term Bond Fund 0-10%
AmSouth Prime Money Market Fund 0-5%
The selection of the underlying funds and their ranges are not fundamental and may be changed
without the prior approval of AmSouth Strategic Portfolios: Aggressive Growth Portfolio's
shareholders.
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
Pioneer Ibbotson Aggressive Allocation Fund:
Because this is an aggressive allocation fund, the majority of Pioneer Ibbotson Aggressive
Allocation Fund's assets will be invested in equity funds, although a portion of its assets will be
invested in bond funds, cash, cash equivalents, or in money market funds. Under normal
circumstances, Pioneer Ibbotson Aggressive Allocation Fund initially expects to invest its assets
among asset classes in the following ranges:
Short-Term
Investments Equity Fund Fixed Income Fund
Allocation Allocation Allocation
-------------------------------------------------------------------
0-5% 75-95% 5-15%
Based upon the analysis described under "Asset allocation process," the Fund initially expects to
invest its assets in underlying mutual funds within the following ranges:
Percentage of
Fund
Fund Name Holdings
------------------------------------------------------------------------------------------------
Pioneer Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Research Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Growth Leaders Fund (formerly Pioneer Papp Stock Fund) 0-25%
------------------------------------------------------------------------------------------------
Pioneer Strategic Growth Fund (formerly Pioneer Papp Strategic 0-25%
Growth Fund)
------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer AmPac Growth Fund (formerly Pioneer Papp America- 0-25%
Pacific Rim Fund)
------------------------------------------------------------------------------------------------
Pioneer Value Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Mid Cap Growth Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Mid Cap Value Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Small and Mid Cap Growth Fund (formerly Pioneer Papp 0-25%
Small and Mid Cap Growth Fund)
------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Small Cap Growth Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Small Cap Value Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer International Equity Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer International Value Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Europe Select Fund 0-25%
------------------------------------------------------------------------------------------------
Pioneer Emerging Markets Fund 0-20%
------------------------------------------------------------------------------------------------
Pioneer Real Estate Shares 0-20%
------------------------------------------------------------------------------------------------
Pioneer High Yield Fund 0-20%
------------------------------------------------------------------------------------------------
Pioneer Bond Fund 0-20%
------------------------------------------------------------------------------------------------
Pioneer Strategic Income Fund 0-20%
------------------------------------------------------------------------------------------------
Pioneer Short Term Income Fund 0-20%
------------------------------------------------------------------------------------------------
Pioneer Cash Reserves Fund 0-15%
The Pioneer Fund may change its target allocation to each asset class, the underlying fund in
each asset class (including adding or deleting funds) or target allocations to each underlying fund
without prior approval from or notice to shareholders. Certain of the Pioneer Funds into which
the AmSouth Funds are being reorganized are not currently included in the above list of funds
underlying the Pioneer Fund. Pioneer and Ibbotson may determine to include such additional
Pioneer Funds in the list of permitted investments for the Pioneer Fund into which your Fund is
being reorganized. Alternatively, Pioneer and Ibbotson may determine to hold those additional
Pioneer Funds temporarily until the Pioneer Fund's portfolio is rebalanced.
Appendix A contains a summary description of each of the underlying Pioneer funds.
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
Normally, the Fund invests substantially all of its assets in underlying funds to meet its
investment objective. However, the Fund may invest a portion of its assets in cash, cash
equivalents or in money market funds. The underlying funds may also invest a portion of their
assets in money market funds, securities with remaining maturities of less than one year, cash
equivalents or may hold cash. For temporary defensive purposes, including during periods of
unusual cash flows, the Fund and each of the underlying funds may depart from its principal
investment strategies and invest part or all of its assets in these securities or may hold cash.
During such periods, the Fund may not be able to achieve its investment objective. The Fund
intends to adopt a defensive strategy when Pioneer or Ibbotson believes securities in which the
Fund normally invests have extraordinary risks due to political or economic factors and in other
extraordinary circumstances.
Borrowing AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation Fund
Growth Portfolio may not borrow money or may not borrow money, except on a temporary
issue senior securities, except that the Fund basis and to the extent permitted by
may borrow from banks or enter into reverse applicable law, the Fund may: (a) borrow from
repurchase agreements for temporary emergency banks or through reverse repurchase agreements
purposes in amounts up to 33 1/3% of the value in an amount up to 33 1/3% of the Fund's total
of its total assets at the time of such assets (including the amount borrowed); (b)
borrowing. AmSouth Strategic Portfolios: borrow up to an additional 5% of the Fund's
Aggressive Growth Portfolio will not purchase assets for temporary purposes; (c) obtain such
securities while borrowings (including reverse short-term credits as are necessary for the
repurchase agreements) in excess of 5% of its clearance of portfolio transactions; (d)
total assets are outstanding. In addition, purchase securities on margin; and (e) engage
AmSouth Strategic Portfolios: Aggressive in transactions in mortgage dollar rolls that
Growth Portfolio is permitted to participate are accounted for as financings.
in a credit facility whereby the Fund may
directly lend to and borrow money from other
AmSouth Funds for temporary purposes, provided
that the loans are made in accordance with an
order of exemption from the SEC and any
conditions thereto.
Other investment As described above, the Funds have substantially similar principal investment strategies and
policies and policies. Certain of the non-principal investment policies and restrictions are different. For a
restrictions more complete discussion of each Fund's other investment policies and fundamental and non-
fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges Class A shares are offered with an initial sales Class A shares are offered with an initial sales
and Rule 12b-1 fees charge of up to 5.50% of the offering price, charge of up to 5.75% of the offering price,
which is reduced depending upon the amount which is reduced or waived for large
invested or, in certain circumstances, waived. purchases and certain types of investors. At
Class A shares bought as part of an investment the time of your purchase, your investment
of $1 million or more are not subject to an firm may receive a commission from Pioneer
initial sales charge, but may be charged a Funds Distributor, Inc. ("PFD"), the Fund's
contingent deferred sales charge ("CDSC") of distributor, of up to 2% declining as the size
1.00% if sold within one year of purchase. of your investment increases.
Class A shares pay a shareholder servicing fee There is no CDSC, except in certain
(non 12b-1) of up to 0.25% of average daily net circumstances when the initial sales charge is
assets. waived.
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges Class B shares are offered without an initial Class B shares are offered without an initial
and Rule 12b-1 fees sales charge, but are subject to a CDSC of up to sales charge, but are subject to a CDSC of up
5%. For Class B shares purchased prior to the to 2% if you sell your shares. The charge is
combination of AmSouth Funds with ISG reduced over time and is not charged after five
Funds, the CDSC on such Class B shares held years. Your investment firm may receive a
continuously declines over six years, starting commission from PFD, the Fund's distributor,
with year one and ending in year seven from: at the time of your purchase of up to 2%.
4%, 3%, 3%, 2%, 2%, 1%. For all other Class
B shares held continuously, the CDSC declines Class B shares are subject to distribution and
over six years, starting with year one and service (12b-1) fees of up to 1% of average
ending in year seven from: 5%, 4%, 3%, 3%, daily net assets.
2%, 1%. Eight years after purchase (seven
years in the case of shares acquired in the ISG Class B shares acquired through the
combination), Class B shares automatically Reorganization will be subject to the CDSC
convert to Class A shares. and commission schedules applicable to the
original purchase.
Class B shares pay a shareholder servicing fee
(non 12b-1) of up to 0.25% of average daily net Maximum purchase of Class B shares in a
assets and a distribution (12b-1) fee of up to single transaction is $49,999.
0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y AmSouth Strategic Portfolios: Aggressive The Fund does not impose any initial,
sales charges and Rule Growth Portfolio does not impose any initial or contingent deferred or asset based sales charge
12b-1 fees CDSC on Class I shares. on Class Y shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average daily distributing the Fund's Class Y shares, none
net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and AmSouth Strategic Portfolios: Aggressive The management fee payable by Pioneer
other fees Growth Portfolio pays an advisory fee on a Ibbotson Aggressive Allocation Fund is equal
monthly basis at an annual rate of 0.20% of the to 0.13% of average daily net assets
Fund's average daily net assets. attributable to the Fund's investments in
underlying funds managed by Pioneer and
ASO Services Company, Inc. ("ASO") serves cash and 0.17% of average daily net assets
as administrator and fund accounting agent for attributable to other investments, including
the Fund. The Fund pays ASO an underlying funds that are not managed by
administrative services fee of 0.15% of the Pioneer, with breakpoints at incremental asset
Fund's average daily net assets. levels. Since Pioneer currently manages all of
the underlying funds, the management fee will
Other expenses of the Fund are being limited to initially be 0.13% of average daily net assets.
0.36% for Class A shares, 0.35% for Class B
shares and 0.31% for Class I shares. Any fee In addition, the Fund reimburses Pioneer for
waiver or expense reimbursement arrangement certain fund accounting and legal expenses
is voluntary and may be discontinued at any incurred on behalf of the Fund and pays a
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
time. You also indirectly bear a pro rata share separate shareholder servicing/transfer agency
of the fees and expenses of the underlying fee to PIMSS, an affiliate of Pioneer.
funds.
Pioneer has contractually agreed not to impose
For the fiscal year ended July 31, 2004, the all or a portion of its fees or to limit other
Fund's annual operating expenses for Class A direct ordinary operating expenses to the
shares, after giving effect to the expense extent required to reduce expenses, other than
limitation were 0.56%, and without giving "Estimated average expense ratio of
effect to the expense limitation, were 0.79% of underlying funds," to 0.85% of the average
average daily net assets. As of January 12, daily net assets attributable to Class A shares
2005, estimated total direct and indirect and 1.64% of average daily net assets
expenses were 2.04% of average daily net attributable to Class B shares. There is no
assets. expense limitation with respect to the Class Y
shares. This expense limitation is in effect for
For the fiscal year ended July 31, 2004, the Class A shares until December 1, 2008 and in
Fund's annual operating expenses for Class B effect for Class B shares until December 1,
shares, after giving effect to the expense 2006. There can be no assurance that Pioneer
limitation were 1.30%, and without giving will extend these expense limitations past such
effect to the expense limitation, were 1.53% of dates. The expense limitation does not limit
average daily net assets. As of January 12, the expenses of the underlying funds
2005, estimated total direct and indirect indirectly incurred by a shareholder.
expenses were 2.78% of average daily net
assets. Class Y shares of the Pioneer Fund are being
offered for the first time in connection with
For the fiscal year ended July 31, 2004, the the Reorganization.
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.51%, and without giving
effect to the expense limitation, were 0.74% of
average daily net assets. As of January 12,
2005, estimated total direct and indirect
expenses were 1.94% of average daily net
assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may
described in the Fund's prospectus. also purchase additional shares of the Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual fund.
fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum $1,000.
investment requirements for the Fund into
which you are exchanging. Exchanges from After you establish an eligible fund account,
one fund to another are taxable. Class A shares you can exchange Fund shares by telephone or
may be exchanged for Class I shares of the online.
same Fund or another AmSouth fund if you
|
AmSouth Strategic Portfolios: Aggressive Pioneer Ibbotson Aggressive Allocation
Growth Portfolio Fund
------------------------------------------------------------------------------------------------------------------------------------
become eligible to purchase Class I shares.
Class I shares may be exchanged for Class A
shares of the same fund. No transaction fees are
currently charged for exchanges.
If you sell your shares or exchange them for
shares of another AmSouth fund within 7 days
of the date of purchase, you will be charged a
2.00% fee on the current net asset value of the
shares sold or exchanged. The fee is paid to the
Fund to offset the costs associated with short-
term trading, such as portfolio transaction and
administrative costs.
The Fund uses a "first-in, first-out" method to
determine how long you have held your shares.
This means that if you purchased shares on
different days, the shares purchased first will
be considered redeemed first for purposes of
determining whether the redemption fee will be
charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator or
brokerage firm to implement the fee). The Fund
will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send
Fund directly in writing or by telephone or by your request to sell shares to PIMSS. You can
contacting a financial intermediary as described also sell your shares by contacting the Fund
in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may
also redeem shares of the Fund by telephone
or online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on an investment in a Fund or a Fund may not perform as well as other investment options.
Fund of funds structure and layering of fees
Each Fund is structured as a fund of funds. Each Fund's investments are focused in the underlying funds, so the Fund's investment performance is directly related to the performance of the underlying funds. Each Fund's net asset value will be affected by the performance of the equity and bond markets and the value of the mutual funds in which the Fund invests. Since the Funds mainly invest in the underlying funds, as opposed to other types of securities, the Funds do not have the same flexibility in their portfolio holdings as many mutual funds. In addition, each Fund indirectly pays a portion of the expenses incurred by the underlying funds. Consequently, an investment in a Fund entails more direct and indirect expenses than a direct investment in the underlying funds. For instance, you will pay management fees and operating expenses of both the Fund and the underlying funds.
The underlying funds will not necessarily make consistent investment decisions, which may also increase your costs. One underlying fund may buy the same security that another underlying fund is selling. You would indirectly bear the costs of both trades without achieving any investment purpose. These transactions may also generate taxable gains. You may receive taxable gains from portfolio transactions by the underlying funds as well as taxable gains from the Fund's transactions in shares of the underlying funds.
Currently, Pioneer manages all of the funds underlying the Pioneer Fund. Because the portfolio management teams of each of the underlying Pioneer funds may draw upon the resources of the same equity and fixed income analyst team or may share common investment management styles or approaches, the underlying funds may hold many common portfolio positions, reducing the diversification benefits of an asset allocation style.
Equity investments
Equity funds invest primarily in equity securities (such as stocks), which are more volatile and carry more risks than some other forms of investment. When the value of the stocks held by an underlying equity fund goes down, the value of your investment in the Fund will be affected.
The underlying equity funds have risks associated with investing in equity securities. An equity fund could underperform other investments if:
o The stock market goes down (this risk may be greater in the short
term)
o The fund's equity investments do not have the growth potential or
value characteristics originally expected
o Stocks selected for income do not achieve the same return as
securities selected for capital growth
o The types of stocks in which the fund invests or the fund's
investment approach fall out of favor with investors
Fixed income investments
Fixed income funds primarily invest in debt securities, such as government securities, investment grade corporate securities, junk bonds, mortgaged backed securities, asset-backed securities, and money market securities. The value of your investment in the fund will change as the value of investments of the underlying funds increases and decreases.
The underlying fixed income funds have risks associated with investing in debt securities. A fund could underperform other investments if:
o Interest rates go up causing the value of the fund's portfolio to
decline
o The issuer of a debt security owned by the fund defaults on its
obligation to pay principal or interest or has its credit rating
downgraded
o During periods of declining interest rates, the issuer of a security
may exercise its option to prepay earlier than scheduled, forcing
the fund to reinvest in lower yielding securities. This is known as
call or prepayment risk
o During periods of rising interest rates, the average life of certain
types of securities may be extended because of slower than expected
principal payments. This may lock in a below market interest rate,
increase the security's duration (the estimated period until the
security is paid in full) and reduce the value of the security. This
is known as extension risk
o The investment manager's judgment about the attractiveness, relative
value or potential appreciation of a particular sector, security or
investment strategy proves to be incorrect
Equity securities of smaller companies
Compared to large companies, small and mid-sized companies, and the market for their equity securities, are likely to:
o Be more sensitive to changes in the economy, earnings results and
investor expectations
o Have more limited product lines and capital resources
o Experience sharper swings in market values
o Be harder to sell at the times and prices Pioneer thinks appropriate
o Offer greater potential for loss than other U.S. equity securities
Equity securities of real estate industry issuers
Specific risks associated with the real estate industry include:
o The U.S. or a local real estate market declines due to adverse
economic conditions, overbuilding and high vacancy rates, reduced or
regulated rents or other causes
o Interest rates go up. Rising interest rates can adversely affect the
availability and cost of financing for property acquisitions and
other purposes and reduce the value of a REIT's fixed income
investments
o The values of properties owned by a REIT or the prospects of other
real estate industry issuers may be hurt by property tax increases,
zoning changes, other governmental actions, environmental
liabilities, natural disasters or increased operating expenses
o A REIT in an underlying fund's portfolio is, or is perceived by the
market to be, poorly managed
Non-U.S. securities
Investing in non-U.S. issuers, including emerging market issuers, may involve unique risks compared to investing in securities of issuers in the U.S. These risks are more pronounced to the extent the fund invests in issuers in the lesser-developed emerging markets or in one region, such as Europe or the Pacific Rim. These risks may include:
o Less information about the non-U.S. issuers or markets may be
available due to less rigorous disclosure or accounting standards or
regulatory practices
o Adverse effect of currency exchange rates or controls on the value
of the fund's investments
o The economies of non-U.S. countries may grow at slower rates than
expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect
securities markets
o Withholding and other non-U.S. taxes may decrease the fund's return
High yield/below investment grade debt securities
Investment in high yield securities involves substantial risk of loss. These securities are considered speculative with respect to the issuer's ability to pay interest and principal and are susceptible to default or decline in market value due to adverse economic and business developments. The market values for high yield securities tend to be very volatile, and these securities are less liquid than investment grade debt securities. For these reasons, your investment in the fund is subject to the following specific risks:
o Increased price sensitivity to changing interest rates and
deteriorating economic environment
o Greater risk of loss due to default or declining credit quality
o Adverse company specific events are more likely to render the issuer
unable to make interest and/or principal payments
o A negative perception of the high yield market develops, depressing
the price and liquidity of high yield securities. This negative
perception could last for a significant period of time
Derivatives
Certain underlying funds may use futures and options on securities, indices and currencies, forward foreign currency exchange contracts and other derivatives. A derivative is a security or instrument whose value is determined by reference to the value or the change in value of one or more securities, currencies, indices or other financial instruments. The underlying funds may use derivatives for a variety of purposes, including:
o As a hedge against adverse changes in stock market prices, interest
rates or currency exchange rates
o As a substitute for purchasing or selling securities
o To increase the fund's return as a non-hedging strategy that may be
considered speculative
Even a small investment in derivatives can have a significant impact on a fund's exposure to stock market values, interest rates or currency exchange rates. If changes in a derivative's value do not correspond to changes in the value of the fund's other investments, the fund may not fully benefit from or could lose money on the derivative position. In addition, some derivatives involve risk of loss if the person who issued the derivative defaults on its obligation. Certain derivatives may be less liquid and more difficult to value.
Past Performance
Set forth below is performance information for AmSouth Strategic Portfolios: Aggressive Growth Portfolio. The bar charts show how AmSouth Strategic Portfolios: Aggressive Growth Portfolio's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The table shows average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar chart gives an indication of the risks of investing in each fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Strategic Portfolios: Aggressive Growth Portfolio -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
2000 1.50% 2001 -9.40% 2002 -22.32% 2003 28.31% 2004 11.13% |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 15.61% for the quarter ended June 30, 2003, and the lowest quarterly return was -19.18% for the quarter ended September 30, 2002.
Pioneer Ibbotson Aggressive Allocation Fund -- Class A Shares Calendar Year Total Returns
Pioneer Ibbotson Growth Allocation Portfolio began investment operations in August 2004. Since the Pioneer Fund has conducted investment operations for less than one calendar year, it may not disclose any performance information in this prospectus. The Fund's performance will vary from year to year. Past performance does not necessarily indicate how a fund will perform in the future. As a shareowner, you may lose or make money on your investment.
AmSouth Strategic Portfolios: Aggressive Growth Portfolio Average Annual Total Returns (for the periods ending December 31, 2004)
Since Inception
1 Year 5 Years (2/1/99)
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Aggressive Growth Portfolio, Class A Shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 5.01% -0.77% 1.99%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 4.96% -1.62% 1.77%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 3.25% -0.97% 1.38%
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Aggressive Growth Portfolio, Class B Shares
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 5.37% -0.74% 2.00%
------------------------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Aggressive Growth Portfolio, Class I Shares
------------------------------------------------------------------------------------------------------------------------------------
|
Since Inception
1 Year 5 Years (2/1/99)
------------------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 11.14% 0.40% 2.93%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 11.08% -0.47% 2.08%
------------------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 7.24% 0.01% 2.17%
------------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index(1) 10.87% -2.30% 0.66%
(reflects no deduction for fees, expenses or taxes)
------------------------------------------------------------------------------------------------------------------------------------
|
(1) The S&P 500, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Strategic Portfolios:
Aggressive Growth Portfolio's returns. After-tax returns are only shown for
Class A shares and Class I shares and may vary for Class B shares. The Fund's
after-tax returns are calculated using the highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes. In
certain cases, the figure representing "Return After Taxes on Distributions and
Sale of Fund Shares" may be higher than the other return figures for the same
period. A higher after-tax return results when a capital loss occurs upon
redemption and translates into an assumed tax deduction that benefits the
shareholder. Please note that actual after-tax returns depend on an investor's
tax situation and may differ from those shown. Also note that after-tax returns
shown are not relevant to shareholders who hold Fund shares through tax-deferred
arrangements, such as 401(k) plans or individual retirement accounts.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly
or indirectly. The tables below show the fees and expenses that you would pay if
you were to buy and hold shares of each Fund. The expenses in the tables
appearing below are based on (i) for the AmSouth Strategic Portfolios:
Aggressive Growth Portfolio, the expenses of AmSouth Strategic Portfolios:
Aggressive Growth Portfolio for the period ended January 31, 2005 and (ii) for
Pioneer Ibbotson Aggressive Allocation Fund, the estimated expenses for the
period ended January 31, 2005. Future expenses for all share classes may be
greater or less. The tables also show the pro forma expenses of the combined
Fund assuming the Reorganization occurred on January 31, 2005.
AmSouth AmSouth AmSouth
Shareholder Strategic Pioneer Strategic Pioneer Strategic
transaction fees Portfolios: Ibbotson Portfolios: Ibbotson Portfolios:
(paid directly Aggressive Aggressive Aggressive Aggressive Combined Aggressive
from your Growth Allocation Combined Fund Growth Allocation Fund (Pro Growth Combined Fund
investment) Portfolio(1) Fund (Pro Forma) Portfolio Fund Forma) Portfolio (Pro Forma)
------------------------------------------------------------------------------------------------------------------------------------
Class A Class A Class A Class B Class B Class B Class I Class Y(7)
------------------------------------------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75% 5.75% None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
------------------------------------------------------------------------------------------------------------------------------------
Maximum None None None 5.00%(3) 4.00% 4.00% None None
deferred sales
charge (load) as
a percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
------------------------------------------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None 2.00%(4) None None 2.00%(4) None
fees
|
AmSouth AmSouth AmSouth
Shareholder Strategic Pioneer Strategic Pioneer Strategic
transaction fees Portfolios: Ibbotson Portfolios: Ibbotson Portfolios:
(paid directly Aggressive Aggressive Aggressive Aggressive Combined Aggressive
from your Growth Allocation Combined Fund Growth Allocation Fund (Pro Growth Combined Fund
investment) Portfolio(1) Fund (Pro Forma) Portfolio Fund Forma) Portfolio (Pro Forma)
------------------------------------------------------------------------------------------------------------------------------------
Class A Class A Class A Class B Class B Class B Class I Class Y(7)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as a %
of average net
assets)
------------------------------------------------------------------------------------------------------------------------------------
Management 0.20% 0.17% 0.17% 0.20% 0.17% 0.17% 0.20% 0.17%
fee
------------------------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.75% 1.00% 1.00% None None
and service
(12b-1) fee
------------------------------------------------------------------------------------------------------------------------------------
Other expenses(5) 0.71% 0.78% 0.75% 0.68% 0.92% 1.08% 0.59% 0.59%
------------------------------------------------------------------------------------------------------------------------------------
Estimated 1.62% 0.81% 0.81% 2.37% 0.81% 0.81% 1.57% 0.81%
indirect
expenses
------------------------------------------------------------------------------------------------------------------------------------
Total fund
operating 2.53% 2.01%(6) 1.98% 4.00% 2.90%(6) 3.06% 2.36% 1.57%
expenses
------------------------------------------------------------------------------------------------------------------------------------
Expense 0.35% 0.27% 0.24% 0.38% 0.27% 0.42% 0.31% N/A
reimbursement/
reduction
------------------------------------------------------------------------------------------------------------------------------------
Net fund 2.18% 1.74% 1.74% 3.62% 2.63% 2.64% 2.05% 1.57%
operating
expenses
------------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Approximately eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.36% for Class A shares, 0.36% for Class B shares and 0.31% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time. Pioneer has contractually agreed not to impose all or a portion of its fees or to limit other direct ordinary operating expenses to the extent required to reduce expenses, other than "Estimated average expense ratio of underlying funds," to 0.85% of the average daily net assets attributable to Class A shares and 1.64% of average daily net assets attributable to Class B shares. This expense limitation is in effect for Class A shares until December 1, 2008 and in effect for Class B until December 1, 2006. There can be no assurance that Pioneer will extend these expense limitations past such dates. The expense limitation does not limit the expenses of the underlying funds indirectly incurred by a shareholder.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(7) Class Y shares of the Pioneer Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
-----------------------------------------------------------------------------------------------------
Number of years you AmSouth Strategic Portfolios: Pioneer Ibbotson Aggressive Combined Fund
own your shares Aggressive Growth Portfolio Allocation Fund (Pro Forma)
-----------------------------------------------------------------------------------------------------
Class A
-----------------------------------------------------------------------------------------------------
Year 1 $ 758 $ 742 $ 742
-----------------------------------------------------------------------------------------------------
Year 3 $1,192 $1,145 $1,091
-----------------------------------------------------------------------------------------------------
Year 5 $1,650 N/A $1,515
-----------------------------------------------------------------------------------------------------
Year 10 $2,916 N/A $2,691
-----------------------------------------------------------------------------------------------------
Class B --- assuming redemption at end of period
-----------------------------------------------------------------------------------------------------
Year 1 $ 798 $ 666 $ 667
-----------------------------------------------------------------------------------------------------
Year 3 $1,213 $1,172 $1,206
-----------------------------------------------------------------------------------------------------
Year 5 $1,752 N/A $1,669
-----------------------------------------------------------------------------------------------------
Year 10 $3,087 N/A $3,092
-----------------------------------------------------------------------------------------------------
Class B --- assuming no redemption
-----------------------------------------------------------------------------------------------------
Year 1 $ 298 $ 266 $ 267
-----------------------------------------------------------------------------------------------------
Year 3 $ 913 $ 872 $ 906
-----------------------------------------------------------------------------------------------------
Year 5 $1,552 N/A $1,569
-----------------------------------------------------------------------------------------------------
Year 10 $3,087 N/A $3,092
-----------------------------------------------------------------------------------------------------
Class I Class Y
-----------------------------------------------------------------------------------------------------
Year 1 $ 211 N/A $ 160
-----------------------------------------------------------------------------------------------------
Year 3 $ 652 N/A $ 496
-----------------------------------------------------------------------------------------------------
Year 5 $1,119 N/A $ 855
-----------------------------------------------------------------------------------------------------
Year 10 $2,410 N/A $1,867
-----------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Strategic Portfolios: Aggressive Growth Portfolio. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $15.7 billion in fixed income securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Third, Pioneer Ibbotson Aggressive Allocation Fund's management fee (0.17% of average daily net assets) is lower than the advisory fee of your Fund (0.20% of average daily net assets). Both the historical and estimated pro forma expenses of the Pioneer Fund, after giving effect to the Reorganization, on a gross and net basis are lower than your Fund's gross and net operating expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder
servicing fees paid by both the Class A and Class B shares of Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduce per share expenses.
Fourth, because of Pioneer distribution arrangements, Pioneer Fund has greater potential to further increase the assets compared to your Fund. Further assets growth is anticipated to further reduce the combined Fund's gross operating expenses per share.
Fifth, the Class A, B and Y shares of the Pioneer Fund received in the Reorganization will provide AmSouth Fund shareholders with exposure to a similar investment product as they currently have. The Trustees also noted that the allocation decisions are made by Ibbotson, a leading asset allocation adviser, and that the Pioneer Fund intends, as soon as permitted by the SEC, to include unaffiliated mutual funds as underlying funds.
Sixth, The transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of AmSouth Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
AmSouth Strategic Pioneer Ibbotson
Portfolios: Pioneer Ibbotson Aggressive
Aggressive Growth Aggressive Allocation Fund
Portfolio Fund Allocation Fund (Pro Forma)
May 31, 2005 May 31, 2005 May 31, 2005
-------------------------------------------------------- ------------------ ----------------- ----------------
Total Net Assets (in thousands) $ 53,136 $ 24,987 $ 78,123
Class A shares ................................... $ 22,953 $ 14,975 $ 37,928
Class B shares ................................... $ 15,156 $ 4,269 $ 19,425
Class I/Y shares ................................. $ 15,028 N/A $ 15,028
Net Asset Value Per Share
Class A shares ................................... $ 9.60 $ 11.21 $ 11.21
Class B shares ................................... $ 9.19 $ 10.82 $ 10.82
Class I shares ................................... $ 9.60 N/A $ 11.21
Shares Outstanding
Class A shares ................................... 2,391,779 1,335,779 3,383,164
Class B shares ................................... 1,649,291 394,722 1,795,948
Class I/Y shares ................................. 1,565,894 N/A 1,340,485
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
Appendix A
Information about the underlying funds
The following is intended to summarize the investment objectives and primary strategies of, and to provide you with certain other information about, the underlying funds. These summaries do not reflect all of the investment policies and strategies that are disclosed in each underlying fund's prospectus, and are not an offer of the underlying funds' shares. The underlying funds in which the funds intend to invest may change from time to time and the funds may invest in underlying funds in addition to those described below at the discretion of Pioneer without prior notice to or approval of shareholders. The prospectus and SAI for each underlying fund is available on the SEC's website as well as on our website at www.pioneerfunds.com.
Each underlying fund normally will be invested according to its investment strategy. However, an underlying fund also may have the ability to invest without limitation in money market instruments or other investments for temporary, defensive purposes.
The underlying funds that invest primarily in equity securities are:
Pioneer Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund invests in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Research Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as preferred stocks, depositary receipts, rights and warrants.
Investment Adviser
Pioneer
Pioneer Growth Leaders Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in common and preferred stocks and securities convertible into stocks. Securities convertible into stocks include depositary receipts on stocks, convertible debt securities, warrants and rights. The fund offers a broad investment program for the equity portion of an investor's portfolio, with an emphasis on mid and large capitalization issuers traded in the U.S. However, the fund may invest in issuers of any capitalization.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Strategic Growth Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of U.S. issuers. The fund invests primarily in securities, traded in the U.S., of issuers that the subadviser believes have substantial international activities. In evaluating whether an issuer has substantial international activities, the subadviser considers the degree to which the issuer has non-U.S. reported sales and revenues, operating earnings or tangible assets. The fund may invest up to 20% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Large Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of large capitalization U.S. companies. Large capitalization companies have market capitalizations at the time of acquisition of $3 billion or more. The fund anticipates that the average weighted market capitalization of the companies in the fund's portfolio will be significantly higher that $3 billion. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer AmPac Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of issuers that have substantial sales to, or receive significant income from, countries within the Pacific Rim. These issuers meet one of the following criteria:
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries (including the U.S. and other countries bordering the Pacific Ocean, such as China and Indonesia)
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries other than the U.S.
The fund also may invest up to 30% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Value Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund seeks to invest in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Mid Cap Growth Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is, companies with market values within the range of market values of issuers included in the Russell Midcap Growth Index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer Cullen Value Fund
Investment objective
Capital appreciation. Current income is a secondary objective.
Principal investment strategies
The fund invests primarily in equity securities. The fund may invest a significant portion of its assets in equity securities of medium- and large-capitalization companies. Consequently, the fund will be subject to the risks of investing in companies with market capitalizations of $1.5 billion or more. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
The fund may invest up to 30% of its total assets in securities of non-U.S. issuers. Up to 5% of the fund's total assets may be invested in securities of emerging market issuers. The fund may invest in securities of Canadian issuers to the same extent as securities of U.S. issuers.
Investment Adviser
Pioneer
Pioneer Mid Cap Value Fund
Investment objective
Capital appreciation by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is companies with market values within the range of market values of companies included in the Russell Midcap Value Index. The fund focuses on issuers with capitalizations within the $1 billion to $10 billion range, and that range will change depending on market conditions. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer
Pioneer Small and Mid Cap Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small and mid-capitalization issuers, that is those with market values, at the time of investment, that do not exceed the market capitalization of the largest company within the S&P Mid Cap 400 Index. The size of the companies in the index may change dramatically as a result of market conditions and the composition of the index. The fund's investments will
not be confined to securities issued by companies included in an index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Small Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small capitalization U.S. companies with market capitalizations of $2 billion or less. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. Small capitalization companies have market capitalizations at the time of acquisition of $2 billion or less. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer Small Cap Value Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small companies. Small companies are those with market values, at the time of investment, that do not exceed the greater of the market capitalization of the largest company within the Russell 2000 Index or the 3-year rolling average of the market capitalization of the largest company within the Russell 2000 Index as measured at the end of the preceding month. The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The size of the companies in the index changes with market conditions and the composition of the index. Pioneer monitors the fund's portfolio so that, under normal circumstances, the capitalization range of the fund's portfolio is consistent with the inclusion of the fund in the Lipper Small-Cap category. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer International Equity Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. The fund focuses on securities of issuers located in countries with developed markets (other than the United States) but may allocate up to 10% of its assets in countries with emerging economies or securities markets. Developed markets outside the United States generally include, but are not limited to, the countries included in the Morgan Stanley Capital International Europe, Australasia, Far East Index. The fund's assets must be allocated to securities of issuers located in at least three non-U.S. countries. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer International Value Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. These issuers may be located in both developed and emerging markets. Under normal circumstances, the fund's assets will be invested in securities of companies domiciled in at least three different foreign countries. Generally, the fund's investments in any country are limited to 25% or less of its total assets. However, the fund may invest more than 25% of its assets in issuers organized in Japan or the United Kingdom or in securities quoted or denominated in the Japanese yen, the British pound and the euro. Investment of a substantial portion of the fund's assets in such countries or currencies will subject the fund to the risks of adverse securities markets, exchange rates and social, political or economic events which may occur in those countries.
The fund may invest without limitation in securities of issuers located in countries with emerging economies or securities markets, but will not invest more than 25% of its total assets in securities of issuers located in any one such country.
For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred shares. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer Europe Select Fund
Investment objective
Capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of European issuers. The fund's principal focus is on European companies that exhibit strong growth characteristics and are considered to be leaders in their sector or industry. The fund generally focuses on mid- and large-capitalization European issuers. Equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in connection with its investments.
Investment Adviser
Pioneer
Pioneer Emerging Markets Fund
Investment objective
Long-term growth of capital.
Principal investment strategies
The fund invests primarily in securities of emerging market issuers. Although the fund invests in both equity and debt securities, it normally emphasizes equity securities in its portfolio. Normally, the fund invests at least 80% of its total assets in the securities of emerging market corporate and government issuers (i.e., securities of companies that are domiciled or primarily doing business in emerging countries and securities of these countries' governmental issuers).
Investment Adviser
Pioneer
Pioneer Real Estate Shares
Investment objective
Long-term growth of capital. Current income is a secondary objective.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of real estate investment trusts (REITs) and other real estate industry issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as warrants, rights, interests in REITs and preferred stocks.
Investment Adviser
Pioneer (adviser); AEW Management and Advisors, L.P. (subadviser)
The underlying funds that invest primarily in debt securities are:
Pioneer Bond Fund
Investment objective
To provide current income from an investment grade portfolio with due regard to preservation of capital and prudent investment risk. The fund also seeks a relatively stable level of dividends; however, the level of dividends will be maintained only if consistent with preserving the investment grade quality of the fund's portfolio.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government or its agencies and instrumentalities,
o Debt securities, including convertible debt, of corporate and other issuers rated at least investment grade at the time of investment, and comparably rated commercial paper,
o Cash and cash equivalents, certificates of deposit, repurchase agreements maturing in one week or less and bankers' acceptances.
Normally, the fund invests at least 80% of its total assets in these securities. In addition, the fund may invest up to 20% of its total assets in debt securities rated below investment grade or, if unrated, of equivalent quality as determined by Pioneer. Cash and cash equivalents include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer High Yield Fund
Investment objective
Maximize total return through a combination of income and capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in below investment grade (high yield) debt securities and preferred stocks. These high yield securities may be convertible into the equity securities of the issuer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
Investment Adviser
Pioneer
Pioneer Short Term Income Fund
Investment objective
A high level of current income to the extent consistent with a relatively high level of stability of principal.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities
o Debt securities, including convertible debt, of corporate and other issuers and commercial paper
o Mortgage-backed and asset-backed securities
o Short-term money market instruments
Normally, at least 80% of the fund's net assets are invested in debt securities that are rated investment grade at the time of purchase or cash and cash equivalents. Cash and cash equivalents may include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer Cash Reserves Fund
Investment objective
High current income, preservation of capital and liquidity through investments in high-quality short-term securities.
Principal investment strategies
The fund seeks to maintain a constant net asset value of $1.00 per share by investing in high-quality, U.S. dollar denominated money market securities, including those issued by:
o U.S. and foreign banks
o U.S. and foreign corporate issuers
o The U.S. government and its agencies and instrumentalities
o Foreign governments
o Multinational organizations such as the World Bank
The fund may invest more than 25% of its total assets in U.S. government securities and obligations of U.S. banks. The fund may invest in any money market instrument that is a permissible investment for a money market fund under the rules of the Securities and Exchange Commission, including commercial paper, certificates of deposit, time deposits, bankers' acceptances, mortgage-backed and asset-backed securities, repurchase agreements, municipal obligations and other short-term debt securities.
Investment Adviser
Pioneer
Pioneer Strategic Income Fund
Investment objective
A high level of current income.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in debt securities. The fund has the flexibility to invest in a broad range of issuers and segments of the debt securities markets. Pioneer Investment Management, Inc., the fund's investment adviser, allocates the fund's investments among the following three segments of the debt markets:
o Below investment grade (high yield) securities of U.S. and non-U.S. issuers
o Investment grade securities of U.S. issuers
o Investment grade securities of non-U.S. issuers
Pioneer's allocations among these segments of the debt markets depend upon its outlook for economic, interest rate and political trends. The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities or non-U.S. governmental entities
o Debt securities of U.S. and non-U.S. corporate issuers, including convertible debt
o Mortgage-backed and asset-backed securities
The fund's investments may have fixed or variable principal payments and all types of interest rate payment and reset terms, including fixed rate, adjustable rate, zero coupon, contingent, deferred, payment in kind and auction rate features. The fund invests in securities with a broad range of maturities.
Depending upon Pioneer's allocation among market segments, up to 70% of the fund's total assets may be in debt securities rated below investment grade at the time of purchase or determined to be of equivalent quality by Pioneer. Up to 20% of the fund's total assets may be invested in debt securities rated below CCC by Standard & Poor's Ratings Group or the equivalent by another nationally recognized statistical rating organization or determined to be of equivalent credit quality by Pioneer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
As with all fixed income securities, the market values of convertible debt securities tend to decline as interest rates increase and, conversely, to increase as interest rates decline. However, when the market price of the common stock underlying a convertible security exceeds the conversion price, the convertible security tends to reflect the market price of the underlying common stock.
Depending upon Pioneer's allocation among market segments, up to 85% of the fund's total assets may be in debt securities of non-U.S. corporate and governmental issuers, including debt securities of corporate and governmental issuers in emerging markets.
Investment Adviser
Pioneer
AmSouth Strategic Portfolios: Growth Portfolio and Pioneer Ibbotson Growth Allocation Fund
PROPOSAL 1(k)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund is structured as a "fund of funds," which means all of its assets are invested in other mutual funds ("underlying funds"). Your Fund invests only in other AmSouth funds. Currently, the Pioneer Fund only invests in other Pioneer Funds but is seeking an exemptive order from the Securities and Exchange Commission that would permit the Pioneer Fund to invest, in addition, in mutual funds that are not managed by Pioneer. To the extent Pioneer receives an order from the Securities and Exchange Commission that permits Pioneer to invest in such other non-Pioneer underlying funds, Pioneer and the Pioneer Fund intend to rely on such order, subject to any applicable conditions of the order. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Strategic Portfolios: Growth Portfolio to Pioneer Ibbotson Growth Allocation Fund
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
-------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A series of Pioneer Ibbotson Asset Allocation
open-end management investment company Series, a diversified open-end management
organized as a Massachusetts business trust. investment company organized as a Delaware
statutory trust.
Net assets as of March 31, $64.9 million $32.8 million
2005
Investment advisers Investment Adviser: Investment Adviser:
and portfolio AAMI Pioneer
managers
Portfolio Manager: Investment Subadviser:
Day-to-day management of the AmSouth Strategic Ibbotson Associates Advisors, LLC ("Ibbotson")
Portfolios: Growth Portfolio is the
responsibility of the AmSouth Strategy Portfolio Managers:
Committee, and no person is primarily Day-to-day management of Pioneer Ibbotson
responsible for making recommendations to the Growth Allocation Fund is the responsibility
Committee. The Committee members consist of of portfolio managers and members of
John Boston, CFA, Fred Crown, CFA, Paige B. Ibbotson's Investment Committee headed by
Daniel, David M. Dasari, CFA, Joseph T. Roger Ibbotson. Roger Ibbotson founded
Keating, Ronald E. Lindquist, John Mark Ibbotson in 1977 and is the firm's Chairman.
McKenzie, Matt Smith, CFA, Brian B. Sullivan, Peng Chen, Ph.D., managing director and chief
CFA, Doug S. Williams and Jason Waters. investment officer at Ibbotson, conducts
research projects on asset allocation,
Mr. Boston is Chief Fixed Income Officer for portfolio risk measurement, nontraditional
AAMI. He began his career in investment assets, and global financial markets. Dr. Chen
management with AmSouth Bank in 1987 and has joined Ibbotson in 1997. Michael E. Annin,
been associated with AAMI since 1996. Mr. managing director, manages the investment
Boston received his CFA charter in 1993 and is management services and data products group
an active member and past president of the for Ibbotson. Scott Wentsel, senior portfolio
Alabama Society of Financial Analysts. He manager, is responsible for management of
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
-------------------------------------------------------------------------------------------------------------------------------
also serves as the portfolio manager for the the firm's fund-of-funds business which includes
AmSouth High Quality Bond Fund. Mr. Boston is oversight of its investment management staff
a Senior Vice President of AmSouth Bank and and process. Alexander E. Kaye, portfolio
Vice President of AAMI. manager, is responsible for managing the
delivery of fund-of-funds programs for
Mr. Crown has been employed with AmSouth Bank institutional and retail clients, which
since 1982 and AAMI since 2001. He was an includes asset allocation modeling, portfolio
Institutional Fund Manager with AAMI construction, fund classification and manager
(2001-2003) and has been a Regional Manager due diligence. Brian Huckstep, portfolio
since 2003. Mr. Crown is a Senior Vice manager, is responsible for managing the
President of AmSouth Bank. delivery of fund-of-funds programs for
institutional and retail clients, which
Ms. Daniel has been employed with AmSouth Bank includes asset allocation modeling, portfolio
since 1999. She has been employed by AAMI as construction, fund classification, and manager
the Director of Alternative Strategies since due diligence.
2003. She is an Assistant Vice President with
AmSouth Bank.
Mr. Dasari has been employed with AmSouth Bank
since 2002 and AAMI since 2003. He is Director
of Individual Security Management for AAMI.
Prior to joining AmSouth Bank, he was
Assistant Vice President at Fifth Third Bank.
Mr. Dasari is a Vice President of AmSouth Bank.
Mr. Keating has been employed with AmSouth
Bank since 2001 and AAMI since 2002. He is the
Chairman and Chief Investment Officer of AAMI.
Prior to 2001, he was employed as the Chief
Market Strategist and Chief Fixed Income
Officer of Fifth Third Bank. Mr. Keating is an
Executive Vice-President of AmSouth Bank.
Mr. Lindquist has been employed with AAMI
since December 1999. Prior to December 1999,
Mr. Lindquist was employed by First American
National Bank (since May 1998), and by Deposit
Guaranty National Bank, and Commercial
National Bank (since 1978). First American
National Bank, Deposit Guaranty National Bank
and Commercial National Bank are predecessors
of AmSouth Bank and affiliates of AAMI. He
also serves as the portfolio manager for the
AmSouth Large Cap Fund. Mr. Lindquist is a
Senior Vice President of AmSouth Bank and Vice
President of AAMI.
Mr. McKenzie has been involved in investment
management since 1981, with portfolio
management expertise in both equity and fixed
income securities. Mr. McKenzie co-managed
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
-------------------------------------------------------------------------------------------------------------------------------
the AmSouth Government Income Fund from 1999 to
2002 and managed it from 2003 to 2004. Mr.
McKenzie has been associated with the Trust
Investment Department of AmSouth Bank, and
banks acquired by AmSouth Bank, since 1984 and
joined AAMI in 2003. Mr. McKenzie is a Senior
Vice President of AmSouth Bank and Vice
President of AAMI.
Mr. Smith has been employed with AmSouth Bank
since 1988. He has been employed by AAMI as a
Regional Manager since 2004. He is a Senior
Vice President with AmSouth Bank.
Mr. Sullivan has been an officer of AAMI since
1996 and joined AmSouth Bank in 1984. Prior
to serving as Director of Fixed Income for
AmSouth Bank's Trust Department, Mr. Sullivan
managed equity portfolios and held the
position of equity research coordinator for
AmSouth Bank's Trust Department. Mr. Sullivan
is a Senior Vice President of AmSouth Bank and
Vice President of AAMI.
Mr. Waters has been employed with AmSouth Bank
since 1999. He has been employed as an
Institutional Portfolio Manager with AAMI
since 2001. Mr. Williams is a Senior Vice
President of AmSouth Bank.
Mr. Williams has been employed with AmSouth
Bank since 2002. He has been employed as a
Regional Manager with AAMI since 2004. Prior
to 2002, Mr. Williams was a Director of
Portfolio Management with Fifth Third Bank
(1988-2002). Mr. Williams is a Senior Vice
President of AmSouth Bank.
Investment objective AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund seeks
seeks to provide investors with long term long-term capital growth and income.
capital growth.
Primary investments Each Fund allocates its investments among underlying funds within pre-determined strategy
ranges.
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
-------------------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Growth Portfolio:
AmSouth Strategic Portfolios: Growth Portfolio allocates its assets among the following underlying
funds within the ranges set forth below based upon AAMI's outlook for the economy, financial markets
and relative market valuations of the underlying AmSouth Funds.
Underlying Fund Allocation Range
AmSouth Value Fund 0-15%
AmSouth Select Equity Fund 0-15%
AmSouth Enhanced Market Fund 0-20%
AmSouth Large Cap Fund 0-15%
AmSouth Capital Growth Fund 0-15%
AmSouth Mid Cap Fund 0-15%
AmSouth Small Cap Fund 0-15%
AmSouth International Equity Fund 0-15%
AmSouth Government Income Fund 0-15%
AmSouth High Quality Bond Fund 0-45%
AmSouth Limited Term Bond Fund 0-15%
AmSouth Prime Money Market Fund 0-5%
The selection of the underlying funds and their ranges are not fundamental and may be changed
without the prior approval of AmSouth Strategic Portfolios: Growth Portfolio's shareholders.
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
-------------------------------------------------------------------------------------------------------------------------------
Pioneer Ibbotson Growth Allocation Fund:
Because this is a moderate growth allocation fund, Pioneer Ibbotson Growth Allocation Fund's assets
will be invested in equity and bond funds, although a small portion of its assets will be invested in
cash, cash equivalents, or in money market funds. Under normal circumstances, Pioneer Ibbotson Growth
Allocation Fund initially expects to invest its assets among asset classes in the following ranges:
Short-Term
Investments Equity Fund Fixed Income Fund
Allocation Allocation Allocation
----------- ----------- -----------------
0-5% 70-80% 20-30%
--------------------------------------------
Based upon the analysis described under "Asset allocation process," the Fund initially expects to
invest its assets in underlying mutual funds within the following ranges:
Percentage of
Fund
Fund Name Holdings
---------------------------------------------------------------
Pioneer Fund 0-25%
---------------------------------------------------------------
Pioneer Research Fund 0-25%
---------------------------------------------------------------
Pioneer Growth Leaders Fund (formerly Pioneer
Papp Stock Fund) 0-25%
---------------------------------------------------------------
Pioneer Strategic Growth Fund (formerly Pioneer
Papp Strategic Growth Fund) 0-25%
---------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund 0-25%
---------------------------------------------------------------
Pioneer AmPac Growth Fund (formerly Pioneer Papp
America-Pacific Rim Fund) 0-25%
---------------------------------------------------------------
Pioneer Value Fund 0-25%
---------------------------------------------------------------
Pioneer Mid Cap Growth Fund 0-25%
---------------------------------------------------------------
Pioneer Mid Cap Value Fund 0-25%
---------------------------------------------------------------
Pioneer Small and Mid Cap Growth Fund
(formerly Pioneer Papp Small and Mid Cap
Growth Fund) 0-25%
---------------------------------------------------------------
Pioneer Oak Ridge Small Cap Growth Fund 0-25%
---------------------------------------------------------------
Pioneer Small Cap Value Fund 0-25%
---------------------------------------------------------------
Pioneer International Equity Fund 0-25%
---------------------------------------------------------------
Pioneer International Value Fund 0-25%
---------------------------------------------------------------
Pioneer Europe Select Fund 0-25%
---------------------------------------------------------------
Pioneer Emerging Markets Fund 0-20%
---------------------------------------------------------------
Pioneer Real Estate Shares 0-20%
---------------------------------------------------------------
Pioneer High Yield Fund 0-20%
---------------------------------------------------------------
Pioneer Bond Fund 0-25%
---------------------------------------------------------------
Pioneer Strategic Income Fund 0-25%
---------------------------------------------------------------
Pioneer Short Term Income Fund 0-20%
---------------------------------------------------------------
Pioneer Cash Reserves Fund 0-20%
---------------------------------------------------------------
The Pioneer Fund may change its target allocation to each asset class, the underlying fund in
each asset class (including adding or deleting funds) or target allocations to each underlying
fund without prior approval from or notice to shareholders. Certain of the Pioneer Funds into
which the AmSouth Funds are being reorganized are not currently included in the above list of
funds underlying the Pioneer Fund. Pioneer and Ibbotson may determine to include such
additional Pioneer Funds in the list of permitted investments for the Pioneer Fund into which
your Fund is being reorganized. Alternatively, Pioneer and Ibbotson may determine to hold those
additional Pioneer Funds temporarily until the Pioneer Fund's portfolio is rebalanced.
Appendix A contains a summary description of each of the underlying Pioneer funds.
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
Normally, the Fund invests substantially all of its assets in underlying funds to meet its
investment objective. However, the Fund may invest a portion of its assets in cash, cash
equivalents or in money market funds. The underlying funds may also invest a portion of their
assets in money market funds, securities with remaining maturities of less than one year, cash
equivalents or may hold cash. For temporary defensive purposes, including during periods of
unusual cash flows, the Fund and each of the underlying funds may depart from its principal
investment strategies and invest part or all of its assets in these securities or may hold
cash. During such periods, the Fund may not be able to achieve its investment objective. The
Fund intends to adopt a defensive strategy when Pioneer or Ibbotson believes securities in
which the Fund normally invests have extraordinary risks due to political or economic factors
and in other extraordinary circumstances.
Borrowing AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund may
may not borrow money or issue senior not borrow money, except on a temporary basis
securities, except that the Fund may borrow and to the extent permitted by applicable law,
from banks or enter into reverse repurchase the Fund may: (a) borrow from banks or through
agreements for temporary emergency purposes in reverse repurchase agreements in an amount up
amounts up to 33 1/3% of the value of its to 33 1/3% of the Fund's total assets
total assets at the time of such borrowing. (including the amount borrowed); (b) borrow up
AmSouth Strategic Portfolios: Growth Portfolio to an additional 5% of the Fund's assets for
will not purchase securities while borrowings temporary purposes; (c) obtain such short-term
(including reverse repurchase agreements) in credits as are necessary for the clearance of
excess of 5% of its total assets are portfolio transactions; (d) purchase
outstanding. In addition, AmSouth Strategic securities on margin; and (e) engage in
Portfolios: Growth Portfolio is permitted to transactions in mortgage dollar rolls that are
participate in a credit facility whereby the accounted for as financings.
Fund may directly lend to and borrow money
from another AmSouth Fund for temporary
purposes, provided that the loans are made in
accordance with an order of exemption from the
SEC and any conditions thereto.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
policies and policies. Certain of the non-principal investment policies and restrictions are different. For
restrictions a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 5.50% of the offering sales charge of up to 5.75% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 2% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge is
(non 12b-1) of up to 0.25% of average daily waived.
net assets.
Class A shares are subject to distribution and
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges Class B shares are offered without an initial Class B shares are offered without an initial
and Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to CDSC of up to
to 5%. For Class B shares purchased prior to 2% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive a
continuously declines over six years, starting commission from PFD, the Fund's distributor,
with year one and ending in year seven from: at the time of your purchase of up to 2%.
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B
shares held continuously, the CDSC declines Class B shares are subject to distribution and
over six years, starting with year one and service (12b-1) fees of up to 1% of average
ending in year seven from: 5%, 4%, 3%, 3%, 2%, daily net assets.
1%. Eight years after purchase (seven years in
the case of shares acquired in the ISG Class B shares acquired through the
combination), Class B shares automatically Reorganization will be subject to the CDSC and
convert to Class A shares. commission schedules applicable to the
original purchase.
Class B shares pay a shareholder servicing fee
(non 12b-1) of up to 0.25% of average daily Maximum purchase of Class B shares in a single
net assets and a distribution (12b-1) fee of transaction is $49,999.
up to 0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y sales AmSouth Strategic Portfolios: Growth Portfolio The Fund does not impose any initial,
sales charges and Rule does not impose any initial or CDSC on Class I contingent deferred or asset based sales
12b-1 fees shares. charge on Class Y shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average distributing the Fund's Class Y shares, none
daily net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and AmSouth Strategic Portfolios: Growth Portfolio The management fee payable by Pioneer Ibbotson
other fees pays an advisory fee on a monthly basis at an Growth Allocation Fund is equal to 0.13% of
annual rate of 0.20% of the Fund's average average daily net assets attributable to the
daily net assets. Fund's investments in underlying funds managed
by Pioneer and cash and 0.17% of average daily
ASO Services Company, Inc. ("ASO") serves as net assets attributable to other investments,
administrator and fund accounting agent for including underlying funds that are not
the Fund. The Fund pays ASO an administrative managed by Pioneer, with breakpoints at
services fee of 0.15% of the Fund's average incremental asset levels. Since currently all
daily net assets. of the underlying funds are managed by
Pioneer, the management fee will initially be
Other expenses of the Fund are being limited 0.13% of average daily net assets.
to 0.30% for Class A shares, 0.29% for Class B
shares and 0.25 % for Class I shares. Any fee In addition, the Fund reimburses Pioneer for
waiver or expense reimbursement arrangement is certain fund accounting and legal expenses
voluntary and may be discontinued at any time. incurred on behalf of the Fund and pays a
You also indirectly bear a pro rata share separate shareholder servicing/transfer agency
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
------------------------------------------------------------------------------------------------------------------------------
of the fees and expenses of the underlying fee to PIMSS, an affiliate of Pioneer.
funds.
Pioneer has contractually agreed not to impose
For the fiscal year ended July 31, 2004, the all or a portion of its fees or to limit other
Fund's annual operating expenses for Class A direct ordinary operating expenses to the
shares, after giving effect to the expense extent required to reduce expenses, other than
limitation were 0.50%, and without giving "Estimated average expense ratio of underlying
effect to the expense limitation, were 0.73% funds," to 0.79% of the average daily net
of average daily net assets. As of January 12, assets attributable to Class A shares and
2005, estimated total direct and indirect 1.57% of average daily net assets attributable
expenses were 1.92% of average daily net to Class B shares. There is no expense
assets. limitation with respect to the Class Y shares.
This expense limitation is in effect for Class
For the fiscal year ended July 31, 2004, the A shares until December 1, 2008 and in effect
Fund's annual operating expenses for Class B for Class B shares until December 1, 2006.
shares, after giving effect to the expense There can be no assurance that Pioneer will
limitation were 1.24%, and without giving extend these expense limitations past such
effect to the expense limitation, were 1.47% dates. The expense limitation does not limit
of average daily net assets. As of January 12, the expenses of the underlying funds
2005, estimated total direct and indirect indirectly incurred by a shareholder.
expenses were 2.66% of average daily net
assets. Class Y shares of the Pioneer Fund are being
offered for the first time in connection with
For the fiscal year ended July 31, 2004, the the Reorganization.
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.45%, and without giving
effect to the expense limitation, were 0.68%
of average daily net assets. As of January 12,
2005, estimated total direct and indirect
expenses were 1.82% of average daily net
assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000.
requirements for the Fund into which you are
exchanging. Exchanges from one fund to another After you establish an eligible fund account,
are taxable. Class A shares may be exchanged you can exchange fund shares by telephone or
for Class I shares of the same Fund or another online.
AmSouth fund if you become eligible to
purchase Class I shares.
|
AmSouth Strategic Portfolios: Growth Portfolio Pioneer Ibbotson Growth Allocation Fund
----------------------------------------------------------------------------------------------------------------------------
Class I shares may be exchanged for Class
A shares of the same fund. No transaction fees
are currently charged for exchanges.
If you sell your shares or exchange them for
shares of another AmSouth fund within 7 days
of the date of purchase, you will be charged a
2.00% fee on the current net asset value of
the shares sold or exchanged. The fee is paid
to the Fund to offset the costs associated
with short-term trading, such as portfolio
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares purchased
first will be considered redeemed first for
purposes of determining whether the redemption
fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator
or brokerage firm to implement the fee). The
Fund will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on an investment in a fund or a fund may not perform as well as other investment options.
Fund of funds structure and layering of fees
Each Fund is structured as a fund of funds. Each Fund's investments are focused in the underlying funds, so the Fund's investment performance is directly related to the performance of the underlying funds. Each Fund's net asset value will be affected by the performance of the equity and bond markets and the value of the mutual funds in which the Fund invests. Since the Funds mainly invest in the underlying funds, as opposed to other types of securities, the Funds do not have the same flexibility in their portfolio holdings as many mutual funds. In addition, each Fund indirectly pays a portion of the expenses incurred by the underlying funds. Consequently, an investment in a Fund entails more direct and indirect expenses than a direct investment in the underlying funds. For instance, you will pay management fees and operating expenses of both the Fund and the underlying funds.
The underlying funds will not necessarily make consistent investment decisions, which may also increase your costs. One underlying fund may buy the same security that another underlying fund is selling. You would indirectly bear the costs of both trades without achieving any investment purpose. These transactions may also generate taxable gains. You may receive taxable gains from portfolio transactions by the underlying funds as well as taxable gains from the fund's transactions in shares of the underlying funds.
Currently, Pioneer manages all of the funds underlying the Pioneer Fund. Because the portfolio management teams of each of the underlying Pioneer funds may draw upon the resources of the same equity and fixed income analyst team or may share common investment management styles or approaches, the underlying funds may hold many common portfolio positions, reducing the diversification benefits of an asset allocation style.
Equity investments
Equity funds invest primarily in equity securities (such as stocks), which are more volatile and carry more risks than some other forms of investment. When the value of the stocks held by an underlying equity fund goes down, the value of your investment in the fund will be affected.
The underlying equity funds have risks associated with investing in equity securities. An equity fund could underperform other investments if:
o The stock market goes down (this risk may be greater in the short
term)
o The fund's equity investments do not have the growth potential or
value characteristics originally expected
o Stocks selected for income do not achieve the same return as
securities selected for capital growth
o The types of stocks in which the fund invests or the fund's
investment approach fall out of favor with investors
Fixed income investments
Fixed income funds primarily invest in debt securities, such as government securities, investment grade corporate securities, junk bonds, mortgaged backed securities, asset-backed securities, and money market securities. The value of your investment in the fund will change as the value of investments of the underlying funds increases and decreases.
The underlying fixed income funds have risks associated with investing in debt securities. A fund could underperform other investments if:
o Interest rates go up causing the value of the fund's portfolio to
decline
o The issuer of a debt security owned by the fund defaults on its
obligation to pay principal or interest or has its credit rating
downgraded
o During periods of declining interest rates, the issuer of a security
may exercise its option to prepay earlier than scheduled, forcing
the fund to reinvest in lower yielding securities. This is known as
call or prepayment risk
o During periods of rising interest rates, the average life of certain
types of securities may be extended because of slower than expected
principal payments. This may lock in a below market interest rate,
increase the security's duration (the estimated period until the
security is paid in full) and reduce the value of the security. This
is known as extension risk
o The investment manager's judgment about the attractiveness, relative
value or potential appreciation of a particular sector, security or
investment strategy proves to be incorrect
Equity securities of smaller companies
Compared to large companies, small and mid-sized companies, and the market for their equity securities, are likely to:
o Be more sensitive to changes in the economy, earnings results and
investor expectations
o Have more limited product lines and capital resources
o Experience sharper swings in market values
o Be harder to sell at the times and prices Pioneer thinks appropriate
o Offer greater potential for loss than other U.S. equity securities
Equity securities of real estate industry issuers
Specific risks associated with the real estate industry include:
o The U.S. or a local real estate market declines due to adverse
economic conditions, overbuilding and high vacancy rates, reduced or
regulated rents or other causes
o Interest rates go up. Rising interest rates can adversely affect the
availability and cost of financing for property acquisitions and
other purposes and reduce the value of a REIT's fixed income
investments
o The values of properties owned by a REIT or the prospects of other
real estate industry issuers may be hurt by property tax increases,
zoning changes, other governmental actions, environmental
liabilities, natural disasters or increased operating expenses
o A REIT in an underlying fund's portfolio is, or is perceived by the
market to be, poorly managed
Non-U.S. securities
Investing in non-U.S. issuers, including emerging market issuers, may involve unique risks compared to investing in securities of issuers in the U.S. These risks are more pronounced to the extent the fund invests in issuers in the lesser-developed emerging markets or in one region, such as Europe or the Pacific Rim. These risks may include:
o Less information about the non-U.S. issuers or markets may be
available due to less rigorous disclosure or accounting standards or
regulatory practices
o Adverse effect of currency exchange rates or controls on the value
of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than
expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect
securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
High yield/below investment grade debt securities
Investment in high yield securities involves substantial risk of loss. These securities are considered speculative with respect to the issuer's ability to pay interest and principal and are susceptible to default or decline in market value due to adverse economic and business developments. The market values for high yield securities tend to be very volatile, and these securities are less liquid than investment grade debt securities. For these reasons, your investment in the fund is subject to the following specific risks:
o Increased price sensitivity to changing interest rates and
deteriorating economic environment
o Greater risk of loss due to default or declining credit quality
o Adverse company specific events are more likely to render the issuer
unable to make interest and/or principal payments
o A negative perception of the high yield market develops, depressing
the price and liquidity of high yield securities. This negative
perception could last for a significant period of time
Derivatives
Certain underlying funds may use futures and options on securities, indices and currencies, forward foreign currency exchange contracts and other derivatives. A derivative is a security or instrument whose value is determined by reference to the value or the change in value of one or more securities, currencies, indices or other financial instruments. The underlying funds may use derivatives for a variety of purposes, including:
o As a hedge against adverse changes in stock market prices, interest
rates or currency exchange rates
o As a substitute for purchasing or selling securities
o To increase the fund's return as a non-hedging strategy that may be
considered speculative
Even a small investment in derivatives can have a significant impact on a fund's exposure to stock market values, interest rates or currency exchange rates. If changes in a derivative's value do not correspond to changes in the value of the
fund's other investments, the fund may not fully benefit from or could lose money on the derivative position. In addition, some derivatives involve risk of loss if the person who issued the derivative defaults on its obligation. Certain derivatives may be less liquid and more difficult to value.
Past Performance
Set forth below is performance information for AmSouth Strategic Portfolios: Growth Portfolio. The bar charts show how AmSouth Strategic Portfolios: Growth Portfolio's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The table shows average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar chart gives an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Strategic Portfolios: Growth Portfolio -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
2000 0.59% 2001 -5.77% 2002 -13.63% 2003 21.84% 2004 8.92% |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 11.62% for the quarter ended June 30, 2003, and the lowest quarterly return was -12.73% for the quarter ended September 30, 2002.
Pioneer Ibbotson Growth Allocation Fund -- Class A Shares Calendar Year Total Returns
Pioneer Ibbotson Growth Allocation Portfolio began investment operations in August 2004. Since the Pioneer Fund has conducted investment operations for less than one calendar year, it may not disclose any performance information in this prospectus. The fund's performance will vary from year to year. Past performance does not necessarily indicate how a fund will perform in the future. As a shareowner, you may lose or make money on your investment.
AmSouth Strategic Portfolios: Growth Portfolio Average Annual Total Returns (for the periods ending December 31, 2004)
Since Inception
1 Year 5 Years (2/1/99)
--------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Growth Portfolio, Class A Shares
--------------------------------------------------------------------------------------------------
Return Before Taxes 2.89% 0.52% 1.90%
--------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 2.61% -0.44% 0.94%
--------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 1.88% -0.07% 1.10%
--------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Growth Portfolio, Class B Shares
--------------------------------------------------------------------------------------------------
Return Before Taxes 3.11% 0.55% 2.19%
--------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Growth Portfolio, Class I Shares
--------------------------------------------------------------------------------------------------
Return Before Taxes 9.13% 1.74% 2.90%
--------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 8.83% 0.76% 1.91%
--------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 5.93% 0.96% 1.94%
--------------------------------------------------------------------------------------------------
|
Since Inception
1 Year 5 Years (2/1/99)
------ ------- ---------------
S&P 500 Index(1) 10.87% -2.30% 0.66%
(reflects no deduction for fees, expenses or taxes)
|
(1) The S&P 500, an unmanaged index of 500 stocks, is for reference only; it does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Strategic Portfolios:
Growth Portfolio's returns. After-tax returns are only shown for Class A shares
and Class I shares and may vary for Class B shares. The Fund's after-tax returns
are calculated using the highest individual federal marginal income tax rates
and do not reflect the impact of state and local taxes. In certain cases, the
figure representing "Return After Taxes on Distributions and Sale of Fund
Shares" may be higher than the other return figures for the same period. A
higher after-tax return results when a capital loss occurs upon redemption and
translates into an assumed tax deduction that benefits the shareholder. Please
note that actual after-tax returns depend on an investor's tax situation and may
differ from those shown. Also note that after-tax returns shown are not relevant
to shareholders who hold Fund shares through tax-deferred arrangements, such as
401(k) plans or individual retirement accounts.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Strategic Portfolios: Growth Portfolio, the expenses of AmSouth Strategic Portfolios: Growth Portfolio for the period ended January 31, 2005 and (ii) for Pioneer Ibbotson Growth Allocation Fund, the estimated expenses for the period ended January 31, 2005. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on January 31, 2005.
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Ibbotson Combined AmSouth Combined
transaction Strategic Ibbotson Fund (Pro Strategic Growth Fund (Pro Strategic Fund (Pro
fees (paid Portfolios Growth Forma) Portfolios Allocation Forma) Portfolios Forma)
directly from Growth Allocation Growth Fund Growth
your Portfolio Fund Portfolio Portfolio
investment) (1)
Class A Class A Class A Class B Class B Class B Class I Class Y(7)
-----------------------------------------------------------------------------------------------------------------
Maximum 5.50%(2) 5.75% 5.75% None None None None None
sales charge
(load) when
you buy
shares as a
percentage of
offering price
-----------------------------------------------------------------------------------------------------------------
Maximum None None None 5.00%(3) 4.00% 4.00% None None
deferred sales
charge (load)
as a
percentage of
purchase
price or the
amount
you receive
when you sell
shares,
whichever is
less
-----------------------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None 2.00%(4) None None 2.00%(4) None
fees
-----------------------------------------------------------------------------------------------------------------
|
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Ibbotson Combined AmSouth Combined
transaction Strategic Ibbotson Fund (Pro Strategic Growth Allocation Fund (Pro Strategic Fund (Pro
fees (paid Portfolios Growth Forma) Portfolios Fund Forma) Portfolios Forma)
directly from Growth Allocation Growth Growth
your Portfolio(1) Fund Portfolio Portfolio
investment)
Class A Class A Class A Class B Class B Class B Class I Class Y(7)
---------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as a
% of average
net assets)
--------------------------------------------------------------------------------------------------------------------
Management 0.20% 0.17% 0.17% 0.20% 0.17% 0.17% 0.20% 0.17%
fee
--------------------------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.75% 1.00% 1.00% None None
and service
(12b-1) fee
--------------------------------------------------------------------------------------------------------------------
Other 0.64% 0.70% 0.62% 0.65% 0.86% 0.93% 0.60% 0.50%
expenses(5)
--------------------------------------------------------------------------------------------------------------------
Estimated 1.52% 0.78% 0.78% 2.26% 0.78% 0.78% 1.47% 0.78%
indirect
expenses
--------------------------------------------------------------------------------------------------------------------
Total fund 2.36% 1.90%(6) 1.82% 3.86% 2.81%(6) 2.88% 2.27% 1.45%
operating
expenses(6)
--------------------------------------------------------------------------------------------------------------------
Expense 0.33% 0.19% 0.14% 0.35% 0.19% 0.30% 0.34% N/A
reimbursement
/reduction
--------------------------------------------------------------------------------------------------------------------
Net fund 2.03% 1.71% 1.68% 3.51% 2.62% 2.58% 1.93% 1.45%
operating
expenses
--------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.31% for Class A shares, 0.30% for Class B shares and 0.26% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time. Pioneer has contractually agreed not to impose all or a portion of its fees or to limit other direct ordinary operating expenses to the extent required to reduce expenses, other than "Estimated average expense ratio of underlying funds," to 0.79% of the average daily net assets attributable to Class A shares and 1.57% of average daily net assets attributable to Class B shares. This expense limitation is in effect for Class A shares until December 1, 2008 and in effect for Class B until December 1, 2006. There can be no assurance that Pioneer will
extend these expense limitations past such dates. The expense limitation does not limit the expenses of the underlying funds indirectly incurred by a shareholder.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(7) Class Y shares of the Pioneer Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
AmSouth Pioneer
Number of Strategic Ibbotson
years you Portfolios: Growth Combined
own your Growth Allocation Fund
shares Portfolio Fund (Pro Forma)
--------------------------------------------------------------------
Class A
--------------------------------------------------------------------
Year 1 $ 747 $ 739 $ 736
--------------------------------------------------------------------
Year 3 $1,157 $1,120 $1,074
--------------------------------------------------------------------
Year 5 $1,593 N/A $1,465
--------------------------------------------------------------------
Year 10 $2,798 N/A $2,555
--------------------------------------------------------------------
Class B --- assuming redemption at end of period
--------------------------------------------------------------------
Year 1 $ 784 $ 665 $ 661
--------------------------------------------------------------------
Year 3 $1,171 $1,153 $1,164
--------------------------------------------------------------------
Year 5 $1,684 N/A $1,592
--------------------------------------------------------------------
Year 10 $2,957 N/A $2,931
--------------------------------------------------------------------
Class B --- assuming no redemption
--------------------------------------------------------------------
Year 1 $ 284 $ 265 $ 261
--------------------------------------------------------------------
Year 3 $ 871 $ 853 $ 864
--------------------------------------------------------------------
Year 5 $1,484 N/A $1,492
--------------------------------------------------------------------
Year 10 $2,957 N/A $2,931
--------------------------------------------------------------------
Class I Class Y
--------------------------------------------------------------------
Year 1 $ 204 N/A $ 148
--------------------------------------------------------------------
Year 3 $ 630 N/A $ 459
--------------------------------------------------------------------
Year 5 $ 1083 N/A $ 792
--------------------------------------------------------------------
Year 10 $2,338 N/A $1,735
--------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Strategic Portfolios: Growth Portfolio. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $15.7 billion in fixed income securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international
equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Third, Pioneer Ibbotson Growth Allocation Fund's management fee (0.17% of average daily net assets) is lower than the advisory fee of your Fund (0.20% of average daily net assets). Both the historical and estimated pro forma expenses of the Pioneer Fund, after giving effect to the Reorganization, on a gross and net basis are lower than your Fund's gross and net operating expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares.
Fourth, because of Pioneer distribution arrangements, Pioneer Fund has greater potential to further increase the assets compared to your fund. Further assets growth is anticipated to further reduce the combined Fund's gross operating expenses per share.
Fifth, the Class A, B and Y shares of the Pioneer Fund received in the Reorganization will provide AmSouth Fund shareholders with exposure to a similar investment product as they currently have. The Trustees also noted that the allocation decisions are made by Ibbotson, a leading asset allocation adviser, and that the Pioneer Fund intends, as soon as permitted by the SEC, to include unaffiliated mutual funds as underlying funds.
Sixth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of AmSouth Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
Pioneer
AmSouth Ibbotson
Strategic Growth
Portfolios: Pioneer Allocation
Growth Portfolio Ibbotson Growth Fund (Pro
Fund Allocation Fund Forma)
May 31, 2005 May 31, 2005 May 31, 2005
---------------- --------------- ------------
Total Net Assets (in thousands) $ 68,258 $ 44,509 $ 112,765
Class A shares..................... $ 30,461 $ 24,395 $ 54,855
Class B shares..................... $ 29,483 $ 7,898 $ 37,380
Class I/Y shares................... $ 8,314 N/A $ 8,314
Net Asset Value Per Share
Class A shares..................... $ 9.72 $ 10.99 $ 10.99
Class B shares..................... $ 9.59 $ 10.06 $ 10.06
Class I/Y shares................... $ 9.76 N/A $ 10.99
Shares Outstanding
Class A shares..................... 3,134,755 2,220,131 4,992,340
Class B shares..................... 3,075,573 785,240 3,716,617
|
Class I/Y shares................... 851,792 N/A 756,607 |
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
Appendix A
Information about the underlying funds
The following is intended to summarize the investment objectives and primary strategies of, and to provide you with certain other information about, the underlying funds. These summaries do not reflect all of the investment policies and strategies that are disclosed in each underlying fund's prospectus, and are not an offer of the underlying funds' shares. The underlying funds in which the funds intend to invest may change from time to time and the funds may invest in underlying funds in addition to those described below at the discretion of Pioneer without prior notice to or approval of shareholders. The prospectus and SAI for each underlying fund is available on the SEC's website as well as on our website at www.pioneerfunds.com.
Each underlying fund normally will be invested according to its investment strategy. However, an underlying fund also may have the ability to invest without limitation in money market instruments or other investments for temporary, defensive purposes.
The underlying funds that invest primarily in equity securities are:
Pioneer Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund invests in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Research Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as preferred stocks, depositary receipts, rights and warrants.
Investment Adviser
Pioneer
Pioneer Growth Leaders Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in common and preferred stocks and securities convertible into stocks. Securities convertible into stocks include depositary receipts on stocks, convertible debt securities, warrants and rights. The fund offers a broad investment program for the equity portion of an investor's portfolio, with an emphasis on mid and large capitalization issuers traded in the U.S. However, the fund may invest in issuers of any capitalization.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Strategic Growth Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of U.S. issuers. The fund invests primarily in securities, traded in the U.S., of issuers that the subadviser believes have substantial international activities. In evaluating whether an issuer has substantial international activities, the subadviser considers the degree to which the issuer has non-U.S. reported sales and revenues, operating earnings or tangible assets. The fund may invest up to 20% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Large Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of large capitalization U.S. companies. Large capitalization companies have market capitalizations at the time of acquisition of $3 billion or more. The fund anticipates that the average weighted market capitalization of the companies in the fund's portfolio will be significantly higher that $3 billion. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer AmPac Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of issuers that have substantial sales to, or receive significant income from, countries within the Pacific Rim. These issuers meet one of the following criteria:
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries (including the U.S. and other countries bordering the Pacific Ocean, such as China and Indonesia)
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries other than the U.S.
The fund also may invest up to 30% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Value Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund seeks to invest in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Mid Cap Growth Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is, companies with market values within the range of market values of issuers included in the Russell Midcap Growth Index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer Cullen Value Fund
Investment objective
Capital appreciation. Current income is a secondary objective.
Principal investment strategies
The fund invests primarily in equity securities. The fund may invest a significant portion of its assets in equity securities of medium- and large-capitalization companies. Consequently, the fund will be subject to the risks of investing in companies with market capitalizations of $1.5 billion or more. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
The fund may invest up to 30% of its total assets in securities of non-U.S. issuers. Up to 5% of the fund's total assets may be invested in securities of emerging market issuers. The fund may invest in securities of Canadian issuers to the same extent as securities of U.S. issuers.
Investment Adviser
Pioneer
Pioneer Mid Cap Value Fund
Investment objective
Capital appreciation by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is companies with market values within the range of market values of companies included in the Russell Midcap Value Index. The fund focuses on issuers with capitalizations within the $1 billion to $10 billion range, and that range will change depending on market conditions. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer
Pioneer Small and Mid Cap Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small and mid-capitalization issuers, that is those with market values, at the time of investment, that do not exceed the market capitalization of the largest company within the S&P Mid Cap 400 Index. The size of the companies in the index may change dramatically as a result of market conditions and the composition of the index. The fund's investments will
not be confined to securities issued by companies included in an index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Small Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small capitalization U.S. companies with market capitalizations of $2 billion or less. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. Small capitalization companies have market capitalizations at the time of acquisition of $2 billion or less. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer Small Cap Value Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small companies. Small companies are those with market values, at the time of investment, that do not exceed the greater of the market capitalization of the largest company within the Russell 2000 Index or the 3-year rolling average of the market capitalization of the largest company within the Russell 2000 Index as measured at the end of the preceding month. The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The size of the companies in the index changes with market conditions and the composition of the index. Pioneer monitors the fund's portfolio so that, under normal circumstances, the capitalization range of the fund's portfolio is consistent with the inclusion of the fund in the Lipper Small-Cap category. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer International Equity Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. The fund focuses on securities of issuers located in countries with developed markets (other than the United States) but may allocate up to 10% of its assets in countries with emerging economies or securities markets. Developed markets outside the United States generally include, but are not limited to, the countries included in the Morgan Stanley Capital International Europe, Australasia, Far East Index. The fund's assets must be allocated to securities of issuers located in at least three non-U.S. countries. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer International Value Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. These issuers may be located in both developed and emerging markets. Under normal circumstances, the fund's assets will be invested in securities of companies domiciled in at least three different foreign countries. Generally, the fund's investments in any country are limited to 25% or less of its total assets. However, the fund may invest more than 25% of its assets in issuers organized in Japan or the United Kingdom or in securities quoted or denominated in the Japanese yen, the British pound and the euro. Investment of a substantial portion of the fund's assets in such countries or currencies will subject the fund to the risks of adverse securities markets, exchange rates and social, political or economic events which may occur in those countries.
The fund may invest without limitation in securities of issuers located in countries with emerging economies or securities markets, but will not invest more than 25% of its total assets in securities of issuers located in any one such country.
For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred shares. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer Europe Select Fund
Investment objective
Capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of European issuers. The fund's principal focus is on European companies that exhibit strong growth characteristics and are considered to be leaders in their sector or industry. The fund generally focuses on mid- and large-capitalization European issuers. Equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in connection with its investments.
Investment Adviser
Pioneer
Pioneer Emerging Markets Fund
Investment objective
Long-term growth of capital.
Principal investment strategies
The fund invests primarily in securities of emerging market issuers. Although the fund invests in both equity and debt securities, it normally emphasizes equity securities in its portfolio. Normally, the fund invests at least 80% of its total assets in the securities of emerging market corporate and government issuers (i.e., securities of companies that are domiciled or primarily doing business in emerging countries and securities of these countries' governmental issuers).
Investment Adviser
Pioneer
Pioneer Real Estate Shares
Investment objective
Long-term growth of capital. Current income is a secondary objective.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of real estate investment trusts (REITs) and other real estate industry issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as warrants, rights, interests in REITs and preferred stocks.
Investment Adviser
Pioneer (adviser); AEW Management and Advisors, L.P. (subadviser)
The underlying funds that invest primarily in debt securities are:
Pioneer Bond Fund
Investment objective
To provide current income from an investment grade portfolio with due regard to preservation of capital and prudent investment risk. The fund also seeks a relatively stable level of dividends; however, the level of dividends will be maintained only if consistent with preserving the investment grade quality of the fund's portfolio.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government or its agencies and instrumentalities,
o Debt securities, including convertible debt, of corporate and other issuers rated at least investment grade at the time of investment, and comparably rated commercial paper,
o Cash and cash equivalents, certificates of deposit, repurchase agreements maturing in one week or less and bankers' acceptances.
Normally, the fund invests at least 80% of its total assets in these securities. In addition, the fund may invest up to 20% of its total assets in debt securities rated below investment grade or, if unrated, of equivalent quality as determined by Pioneer. Cash and cash equivalents include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer High Yield Fund
Investment objective
Maximize total return through a combination of income and capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in below investment grade (high yield) debt securities and preferred stocks. These high yield securities may be convertible into the equity securities of the issuer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
Investment Adviser
Pioneer
Pioneer Short Term Income Fund
Investment objective
A high level of current income to the extent consistent with a relatively high level of stability of principal.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities
o Debt securities, including convertible debt, of corporate and other issuers and commercial paper
o Mortgage-backed and asset-backed securities
o Short-term money market instruments
Normally, at least 80% of the fund's net assets are invested in debt securities that are rated investment grade at the time of purchase or cash and cash equivalents. Cash and cash equivalents may include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer Cash Reserves Fund
Investment objective
High current income, preservation of capital and liquidity through investments in high-quality short-term securities.
Principal investment strategies
The fund seeks to maintain a constant net asset value of $1.00 per share by investing in high-quality, U.S. dollar denominated money market securities, including those issued by:
o U.S. and foreign banks
o U.S. and foreign corporate issuers
o The U.S. government and its agencies and instrumentalities
o Foreign governments
o Multinational organizations such as the World Bank
The fund may invest more than 25% of its total assets in U.S. government securities and obligations of U.S. banks. The fund may invest in any money market instrument that is a permissible investment for a money market fund under the rules of the Securities and Exchange Commission, including commercial paper, certificates of deposit, time deposits, bankers' acceptances, mortgage-backed and asset-backed securities, repurchase agreements, municipal obligations and other short-term debt securities.
Investment Adviser
Pioneer
Pioneer Strategic Income Fund
Investment objective
A high level of current income.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in debt securities. The fund has the flexibility to invest in a broad range of issuers and segments of the debt securities markets. Pioneer Investment Management, Inc., the fund's investment adviser, allocates the fund's investments among the following three segments of the debt markets:
o Below investment grade (high yield) securities of U.S. and non-U.S. issuers
o Investment grade securities of U.S. issuers
o Investment grade securities of non-U.S. issuers
Pioneer's allocations among these segments of the debt markets depend upon its outlook for economic, interest rate and political trends. The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities or non-U.S. governmental entities
o Debt securities of U.S. and non-U.S. corporate issuers, including convertible debt
o Mortgage-backed and asset-backed securities
The fund's investments may have fixed or variable principal payments and all types of interest rate payment and reset terms, including fixed rate, adjustable rate, zero coupon, contingent, deferred, payment in kind and auction rate features. The fund invests in securities with a broad range of maturities.
Depending upon Pioneer's allocation among market segments, up to 70% of the fund's total assets may be in debt securities rated below investment grade at the time of purchase or determined to be of equivalent quality by Pioneer. Up to 20% of the fund's total assets may be invested in debt securities rated below CCC by Standard & Poor's Ratings Group or the equivalent by another nationally recognized statistical rating organization or determined to be of equivalent credit quality by Pioneer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
As with all fixed income securities, the market values of convertible debt securities tend to decline as interest rates increase and, conversely, to increase as interest rates decline. However, when the market price of the common stock underlying a convertible security exceeds the conversion price, the convertible security tends to reflect the market price of the underlying common stock.
Depending upon Pioneer's allocation among market segments, up to 85% of the fund's total assets may be in debt securities of non-U.S. corporate and governmental issuers, including debt securities of corporate and governmental issuers in emerging markets.
Investment Adviser
Pioneer
AmSouth Strategic Portfolios: Growth & Income Portfolio and Pioneer Ibbotson Moderate Allocation Fund
PROPOSAL 1(l)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund is structured as a "fund of funds," which means all of its assets are invested in other mutual funds ("underlying funds"). Your Fund invests only in other AmSouth funds. Currently, the Pioneer Fund only invests in other Pioneer Funds but is seeking an exemptive order from the Securities and Exchange Commission that would permit the Pioneer Fund to invest, in addition, in mutual funds that are not managed by Pioneer. To the extent Pioneer receives an order from the Securities and Exchange Commission that permits Pioneer to invest in such other non-Pioneer underlying funds, Pioneer and the Pioneer Fund intend to rely on such order, subject to any applicable conditions of the order. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Strategic Portfolios: Growth & Income Portfolio to Pioneer Ibbotson Moderate Allocation Fund
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A series of Pioneer Ibbotson Asset Allocation
open-end management investment company Series, a diversified open-end management
organized as a Massachusetts business trust. investment company organized as a Delaware
statutory trust.
Net assets as of March 31, $112.5 million $34.3 million
2005
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Investment Subadviser:
Day-to-day management of AmSouth Strategic Ibbotson Associates Advisors, LLC ("Ibbotson")
Portfolios: Growth & Income Portfolio is the
responsibility of the AmSouth Strategy Portfolio Managers:
Committee, and no person is primarily Day-to-day management of Pioneer Ibbotson
responsible for making recommendations to Moderate Allocation Fund is the responsibility
the Committee. The Committee members consist of portfolio managers and members of Ibbotson's
of John Boston, CFA, Fred Crown, CFA, Paige Investment Committee headed by Roger Ibbotson.
B. Daniel, David M. Dasari, CFA, Joseph T. Roger Ibbotson founded Ibbotson in 1977 and is
Keating, Ronald E. Lindquist, John Mark the firm's Chairman. Peng Chen, Ph.D., managing
McKenzie, Matt Smith, CFA, Brian director and chief investment officer at
B. Sullivan, CFA, Doug S. Williams and Jason Ibbotson, conducts research projects on asset
Waters. allocation, portfolio risk measurement,
nontraditional assets, and global financial
Mr. Boston is Chief Fixed Income Officer for markets. Dr. Chen joined Ibbotson in 1997.
AAMI. He began his career in investment Michael E. Annin, managing director, manages the
management with AmSouth Bank in 1987 and has investment management services and data products
been associated with AAMI since 1996. group for Ibbotson. Scott Wentsel, senior
Mr. Boston received his CFA charter in 1993 portfolio manager, is responsible for management
and is an active member and past of the firm's fund-
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
president of the Alabama Society of Financial of-funds business which includes oversight of
Analysts. He also serves as the portfolio its investment management staff and process.
manager for the AmSouth High Quality Bond Alexander E. Kaye, portfolio manager, is
Fund. Mr. Boston is a Senior Vice President of responsible for managing the delivery of
AmSouth Bank and Vice President of AAMI. fund-of-funds programs for institutional and
retail clients, which includes asset allocation
Mr. Crown has been employed with AmSouth modeling, portfolio construction, fund
Bank since 1982 and AAMI since 2001. He was classification and manager due diligence. Brian
an Institutional Fund Manager with AAMI Huckstep, portfolio manager, is responsible for
(2001-2003) and has been a Regional Manager managing the delivery of fund-of-funds programs
since 2003. Mr. Crown is a Senior Vice for institutional and retail clients, which
President of AmSouth Bank. includes asset allocation modeling, portfolio
construction, fund classification, and manager
Ms. Daniel has been employed with AmSouth due diligence.
Bank since 1999. She has been employed by
AAMI as the Director of Alternative
Strategies since 2003. She is an Assistant
Vice President with AmSouth Bank.
Mr. Dasari has been employed with AmSouth
Bank since 2002 and AAMI since 2003. He is
Director of Individual Security Management
for AAMI. Prior to joining AmSouth Bank, he
was Assistant Vice President at Fifth Third
Bank. Mr. Dasari is a Vice President of
AmSouth Bank.
Mr. Keating has been employed with AmSouth
Bank since 2001 and AAMI since 2002. He is
the Chairman and Chief Investment Officer of
AAMI. Prior to 2001, he was employed as the
Chief Market Strategist and Chief Fixed
Income Officer of Fifth Third Bank. Mr.
Keating is an Executive Vice-President of
AmSouth Bank.
Mr. Lindquist has been employed with AAMI
since December 1999. Prior to December 1999,
Mr. Lindquist was employed by First American
National Bank (since May 1998), and by
Deposit Guaranty National Bank, and
Commercial National Bank (since 1978). First
American National Bank, Deposit Guaranty
National Bank and Commercial National Bank
are predecessors of AmSouth Bank and
affiliates of AAMI. He also serves as the
portfolio manager for the AmSouth Large Cap
Fund. Mr. Lindquist is a Senior Vice
President of AmSouth Bank and Vice President
of AAMI.
Mr. McKenzie has been involved in
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
investment management since 1981, with
portfolio management expertise in both equity
and fixed income securities. Mr. McKenzie
co-managed the AmSouth Government Income
Fund from 1999 to 2002 and managed it from
2003 to 2004. Mr. McKenzie has been
associated with the Trust Investment
Department of AmSouth Bank, and banks
acquired by AmSouth Bank, since 1984 and
joined AAMI in 2003. Mr. McKenzie is a
Senior Vice President of AmSouth Bank and
Vice President of AAMI.
Mr. Smith has been employed with AmSouth
Bank since 1988. He has been employed by
AAMI as a Regional Manager since 2004. He is
a Senior Vice President with AmSouth Bank.
Mr. Sullivan has been an officer of AAMI
since 1996 and joined AmSouth Bank in 1984.
Prior to serving as Director of Fixed Income
for AmSouth Bank's Trust Department, Mr.
Sullivan managed equity portfolios and held
the position of equity research coordinator
for AmSouth Bank's Trust Department. Mr.
Sullivan is a Senior Vice President of
AmSouth Bank and Vice President of AAMI.
Mr. Waters has been employed with AmSouth
Bank since 1999. He has been employed as an
Institutional Portfolio Manager with AAMI
since 2001. Mr. Williams is a Senior Vice
President of AmSouth Bank.
Mr. Williams has been employed with AmSouth
Bank since 2002. He has been employed as a
Regional Manager with AAMI since 2004. Prior
to 2002, Mr. Williams was a Director of
Portfolio Management with Fifth Third Bank
(1988-2002). Mr. Williams is a Senior Vice
President of AmSouth Bank.
Investment objective AmSouth Strategic Portfolios: Growth & Pioneer Ibbotson Moderate Allocation Fund seeks
Income Portfolio seeks to provide investors long-term capital growth and current income.
with long-term capital growth and a moderate
level of current income.
Primary investments Each Fund allocates its investments among underlying funds within pre-determined strategy
ranges.
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Growth & Income Portfolio:
AmSouth Strategic Portfolios: Growth & Income Portfolio allocates its assets among the
following underlying funds within the ranges set forth below based upon AAMI's outlook for the
economy, financial markets and relative market valuations of the underlying AmSouth Funds.
Underlying Fund Allocation Range
AmSouth Value Fund 0-15%
AmSouth Select Equity Fund 0-10%
AmSouth Enhanced Market Fund 0-15%
AmSouth Large Cap Fund 0-10%
AmSouth Capital Growth Fund 0-15%
AmSouth Mid Cap Fund 0-10%
AmSouth Small Cap Fund 0-10%
AmSouth International Equity Fund 0-10%
AmSouth Government Income Fund 0-20%
AmSouth High Quality Bond Fund 0-60%
AmSouth Limited Term Bond Fund 0-20%
AmSouth Prime Money Market Fund 0-5%
The selection of the underlying funds and their ranges are not fundamental and may be changed
without the prior approval of AmSouth Strategic Portfolios: Growth & Income Portfolio's
shareholders.
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
Pioneer Ibbotson Moderate Allocation Fund:
Because this is a moderate allocation fund, Pioneer Ibbotson Moderate Allocation Fund's assets
will be invested in equity and bond funds, although a portion of its assets will be invested in
cash, cash equivalents, or in money market funds. Under normal circumstances, Pioneer Ibbotson
Moderate Allocation Fund initially expects to invest its assets among asset classes in the
following ranges:
Short-Term
Investments Equity Fund Fixed Income Fund
Allocation Allocation Allocation
----------------------------------------------
0-5% 55-65% 35-45%
Based upon the analysis described under "Asset allocation process," the Fund initially expects
to invest its assets in underlying mutual funds within the following ranges:
Percentage of
Fund
Fund Name Holdings
--------------------------------------------------------------------------------------------
Pioneer Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Research Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Growth Leaders Fund (formerly Pioneer Papp Stock Fund) 0-20%
--------------------------------------------------------------------------------------------
Pioneer Strategic Growth Fund (formerly Pioneer Papp Strategic Growth Fund) 0-20%
--------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer AmPac Growth Fund (formerly Pioneer Papp America-Pacific Rim Fund) 0-20%
--------------------------------------------------------------------------------------------
Pioneer Value Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Mid Cap Growth Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Mid Cap Value Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Small and Mid Cap Growth Fund (formerly Pioneer Papp Small and Mid
Cap Growth Fund) 0-20%
--------------------------------------------------------------------------------------------
Pioneer Oak Ridge Small Cap Growth Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Small Cap Value Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer International Equity Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer International Value Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Europe Select Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Emerging Markets Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Real Estate Shares 0-20%
--------------------------------------------------------------------------------------------
Pioneer High Yield Fund 0-20%
--------------------------------------------------------------------------------------------
Pioneer Bond Fund 0-25%
--------------------------------------------------------------------------------------------
Pioneer Strategic Income Fund 0-25%
--------------------------------------------------------------------------------------------
Pioneer Short Term Income Fund 0-25%
--------------------------------------------------------------------------------------------
Pioneer Cash Reserves Fund 0-20%
--------------------------------------------------------------------------------------------
The Pioneer Fund may change its target allocation to each asset class, the underlying fund in
each asset class (including adding or deleting funds) or target allocations to each underlying
fund without prior approval from or notice to shareholders. Certain of the Pioneer Funds into
which the AmSouth Funds are being reorganized are not currently included in the above list of
funds underlying the Pioneer Fund. Pioneer and Ibbotson may determine to include such
additional Pioneer Funds in the list of permitted investments for the Pioneer Fund into which
your Fund is being reorganized. Alternatively, Pioneer and Ibbotson may determine to hold those
additional Pioneer Funds temporarily until the Pioneer Fund's portfolio is rebalanced.
Appendix A contains a summary description of each of the underlying Pioneer funds.
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
Normally, the Fund invests substantially all of its assets in underlying funds to meet its
investment objective. However, the Fund may invest a portion of its assets in cash, cash
equivalents or in money market funds. The underlying funds may also invest a portion of their
assets in money market funds, securities with remaining maturities of less than one year, cash
equivalents or may hold cash. For temporary defensive purposes, including during periods of
unusual cash flows, the Fund and each of the underlying funds may depart from its principal
investment strategies and invest part or all of its assets in these securities or may hold
cash. During such periods, the fund may not be able to achieve its investment objective. The
Fund intends to adopt a defensive strategy when Pioneer or Ibbotson believes securities in
which the fund normally invests have extraordinary risks due to political or economic factors
and in other extraordinary circumstances.
Borrowing AmSouth Strategic Portfolios: Growth & Pioneer Ibbotson Moderate Allocation Fund may
Income Portfolio may not borrow money or not borrow money, except on a temporary basis
issue senior securities, except that the and to the extent permitted by applicable law,
Fund may borrow from banks or enter into the Fund may: (a) borrow from banks or through
reverse repurchase agreements for temporary reverse repurchase agreements in an amount up to
emergency purposes in amounts up to 33 1/3% 33 1/3% of the Fund's total assets (including
of the value of its total assets at the time the amount borrowed); (b) borrow up to an
of such borrowing. AmSouth Strategic additional 5% of the Fund's assets for temporary
Portfolios: Growth & Income Portfolio will purposes; (c) obtain such short-term credits as
not purchase securities while borrowings are necessary for the clearance of portfolio
(including reverse repurchase agreements) in transactions; (d) purchase securities on margin;
excess of 5% of its total assets are and (e) engage in transactions in mortgage
outstanding. In addition, AmSouth Strategic dollar rolls that are accounted for as
Portfolios: Growth & Income Portfolio is financings.
permitted to participate in a credit
facility whereby the Fund may directly lend
to and borrow money from other AmSouth funds
for temporary purposes, provided that the
loans are made in accordance with an order
of exemption from the SEC and any conditions
thereto.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial sales
Rule 12b-1 fees sales charge of up to 5.50% of the offering charge of up to 5.75% of the offering price,
price, which is reduced depending upon the which is reduced or waived for large purchases
amount invested or, in certain and certain types of investors. At the time of
circumstances, waived. Class A shares bought your purchase, your investment firm may receive
as part of an investment of $1 million or a commission from Pioneer Funds Distributor,
more are not subject to an initial sales Inc. ("PFD"), the Fund's distributor, of up to
charge, but may be charged a contingent 2% declining as the size of your investment
deferred sales charge ("CDSC") of 1.00% if increases.
sold within one year of purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing circumstances when the initial sales charge is
fee (non 12b-1) of up to 0.25% of average
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
daily net assets. waived.
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges and Class B shares are offered without an Class B shares are offered without an initial
Rule 12b-1 fees initial sales charge, but are subject to a sales charge, but are subject to a CDSC of up to
CDSC of up to 5%. For Class B shares 2% if you sell your shares. The charge is
purchased prior to the combination of reduced over time and is not charged after three
AmSouth Funds with ISG Funds, the CDSC on years. Your investment firm may receive a
such Class B shares held continuously commission from PFD, the Fund's distributor, at
declines over six years, starting with year the time of your purchase of up to 2%.
one and ending in year seven from: 4%, 3%,
3%, 2%, 2%, 1%. For all other Class B shares Class B shares are subject to distribution and
held continuously, the CDSC declines over service (12b-1) fees of up to 1% of average
six years, starting with year one and ending daily net assets.
in year seven from: 5%, 4%, 3%, 3%, 2%, 1%.
Eight years after purchase (seven years in Class B shares acquired through the
the case of shares acquired in the ISG Reorganization will be subject to the CDSC and
combination), Class B shares automatically commission schedules applicable to the original
convert to Class A shares. purchase.
Class B shares pay a shareholder servicing Maximum purchase of Class B shares in a single
fee (non 12b-1) of up to 0.25% of average transaction is $49,999.
daily net assets and a distribution (12b-1)
fee of 0.75% of up to average daily net
assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y sales AmSouth Strategic Portfolios: Growth & The Fund does not impose any initial, contingent
charges and Rule 12b-1 Income Portfolio does not impose any initial deferred or asset based sales charge on Class Y
fees or CDSC on Class I shares. shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average distributing the Fund's Class Y shares, none of
daily net assets. which are reimbursed by the Fund or the Class Y
shareowners.
Management and other fees AmSouth Strategic Portfolios: Growth & The management fee payable by Pioneer Ibbotson
Income Portfolio pays an advisory fee on a Moderate Allocation Fund is equal to 0.13% of
monthly basis at an annual rate of 0.20% of average daily net assets attributable to the
the Fund's average daily net assets. Fund's investments in underlying funds managed
by Pioneer and cash and 0.17% of average daily
ASO Services Company, Inc. ("ASO") serves as net assets attributable to other investments,
administrator and fund accounting agent for including underlying funds that are not managed
the Fund. The Fund pays ASO an by Pioneer, with breakpoints at incremental
administrative services fee of 0.15% of the asset levels. Since currently all of the
Fund's average daily net assets. underlying funds are managed by Pioneer, the
management fee will initially be 0.13% of
Other expenses of the Fund are being limited average daily net assets.
to 0.33% for Class A shares, 0.33% for Class
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
B shares and 0.28% for Class I shares. Any In addition, the Fund reimburses Pioneer for
fee waiver or expense reimbursement certain fund accounting and legal expenses
arrangement is voluntary and may be incurred on behalf of the Fund and pays a
discontinued at any time. You also separate shareholder servicing/transfer agency
indirectly bear a pro rata share of the fees fee to PIMSS, an affiliate of Pioneer.
and expenses of the underlying funds.
Pioneer has contractually agreed not to impose
For the fiscal year ended July 31, 2004, the all or a portion of its fees or to limit other
Fund's annual operating expenses for Class A direct ordinary operating expenses to the extent
shares, after giving effect to the expense required to reduce expenses, other than
limitation were 0.53%, and without giving "Estimated average expense ratio of underlying
effect to the expense limitation, were 0.66% funds," to 0.74% of the average daily net assets
of average daily net assets. As of January attributable to Class A shares and 1.64% of
12, 2005, estimated total direct and average daily net assets attributable to Class B
indirect expenses were 1.81% of average shares. There is no expense limitation with
daily net assets. respect to the Class Y shares. This expense
limitation is in effect for Class A shares until
For the fiscal year ended July 31, 2004, the December 1, 2008 and in effect for Class B
Fund's annual operating expenses for Class B shares until December 1, 2006. There can be no
shares, after giving effect to the expense assurance that Pioneer will extend these expense
limitation were 1.28%, and without giving limitations past such dates. The expense
effect to the expense limitation, were 1.41% limitation does not limit the expenses of the
of average daily net assets. As of January underlying funds indirectly incurred by a
12, 2005, estimated total direct and shareholder.
indirect expenses were 2.56% of average
daily net assets. Class Y shares of the Pioneer Fund are being
offered for the first time in connection with
For the fiscal year ended July 31, 2004, the the Reorganization.
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.48%, and without giving
effect to the expense limitation, were 0.61%
of average daily net assets. As of January
12, 2005, estimated total direct and
indirect expenses were 1.74% of average
daily net assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm that
through BISYS Fund Services, the Fund's has a sales agreement with PFD, the Pioneer
distributor, or through brokers, registered Fund's distributor.
investment advisers, banks and other
financial institutions that have entered If the account is established in the
into selling agreements with the Fund's shareholder's own name, shareholders may also
distributor, as described in the Fund's purchase additional shares of the Fund by
prospectus. telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund. Your
fund, usually without paying additional exchange request must be for at least $1,000.
sales charges. You must meet the minimum
investment requirements for the
|
AmSouth Strategic Portfolios: Growth &
Income Portfolio Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------------------------------------------------
Fund into which you are exchanging. Exchanges After you establish an eligible fund account,
from one fund to another are taxable. Class A you can exchange Fund shares by telephone or
shares may be exchanged for Class I shares of online.
the same Fund or another AmSouth Fund if you
become eligible to purchase Class I shares.
Class I shares may be exchanged for Class A
shares of the same fund. No transaction fees
are currently charged for exchanges.
If you sell your shares or exchange them for
shares of another AmSouth fund within 7 days
of the date of purchase, you will be charged
a 2.00% fee on the current net asset value
of the shares sold or exchanged. The fee is
paid to the Fund to offset the costs
associated with short-term trading, such as
portfolio transaction and administrative
costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares
purchased first will be considered redeemed
first for purposes of determining whether
the redemption fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except
where it is not practical for the plan
administrator or brokerage firm to implement
the fee). The Fund will not impose the
redemption fee on a redemption or exchange
of shares purchased upon the reinvestment of
dividend and capital gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on an investment in a fund or a fund may not perform as well as other investment options.
Fund of funds structure and layering of fees
Each Fund is structured as a fund of funds. Each Fund's investments are focused in the underlying funds, so the Fund's investment performance is directly related to the performance of the underlying funds. Each Fund's net asset value will be affected by the performance of the equity and bond markets and the value of the mutual funds in which the fund invests. Since the Funds mainly invest in the underlying funds, as opposed to other types of securities, the Funds do not have the same flexibility in their portfolio holdings as many mutual funds. In addition, each Fund indirectly pays a portion of the expenses incurred by the underlying funds. Consequently, an investment in a Fund entails more direct and indirect expenses than a direct investment in the underlying funds. For instance, you will pay management fees and operating expenses of both the Fund and the underlying funds.
The underlying funds will not necessarily make consistent investment decisions, which may also increase your costs. One underlying fund may buy the same security that another underlying fund is selling. You would indirectly bear the costs of both trades without achieving any investment purpose. These transactions may also generate taxable gains. You may receive taxable gains from portfolio transactions by the underlying funds as well as taxable gains from the fund's transactions in shares of the underlying funds.
Currently, Pioneer manages all of the funds underlying the Pioneer Fund. Because the portfolio management teams of each of the underlying Pioneer funds may draw upon the resources of the same equity and fixed income analyst team or may share common investment management styles or approaches, the underlying funds may hold many common portfolio positions, reducing the diversification benefits of an asset allocation style.
Equity investments
Equity funds invest primarily in equity securities (such as stocks), which are more volatile and carry more risks than some other forms of investment. When the value of the stocks held by an underlying equity fund goes down, the value of your investment in the fund will be affected.
The underlying equity funds have risks associated with investing in equity securities. An equity fund could underperform other investments if:
o The stock market goes down (this risk may be greater in the short
term)
o The fund's equity investments do not have the growth potential or
value characteristics originally expected
o Stocks selected for income do not achieve the same return as
securities selected for capital growth
o The types of stocks in which the fund invests or the fund's
investment approach fall out of favor with investors
Fixed income investments
Fixed income funds primarily invest in debt securities, such as government securities, investment grade corporate securities, junk bonds, mortgaged backed securities, asset-backed securities, and money market securities. The value of your investment in the fund will change as the value of investments of the underlying funds increases and decreases.
The underlying fixed income funds have risks associated with investing in debt securities. A fund could underperform other investments if:
o Interest rates go up causing the value of the fund's portfolio to
decline
o The issuer of a debt security owned by the fund defaults on its
obligation to pay principal or interest or has its credit rating
downgraded
o During periods of declining interest rates, the issuer of a security
may exercise its option to prepay earlier than scheduled, forcing
the fund to reinvest in lower yielding securities. This is known as
call or prepayment risk
o During periods of rising interest rates, the average life of certain
types of securities may be extended because of slower than expected
principal payments. This may lock in a below market interest rate,
increase the security's duration (the estimated period until the
security is paid in full) and reduce the value of the security. This
is known as extension risk
o The investment manager's judgment about the attractiveness, relative
value or potential appreciation of a particular sector, security or
investment strategy proves to be incorrect
Equity securities of smaller companies
Compared to large companies, small and mid-sized companies, and the market for their equity securities, are likely to:
o Be more sensitive to changes in the economy, earnings results and
investor expectations
o Have more limited product lines and capital resources
o Experience sharper swings in market values
o Be harder to sell at the times and prices Pioneer thinks appropriate
o Offer greater potential for loss than other U.S. equity securities
Equity securities of real estate industry issuers
Specific risks associated with the real estate industry include:
o The U.S. or a local real estate market declines due to adverse
economic conditions, overbuilding and high vacancy rates, reduced or
regulated rents or other causes
o Interest rates go up. Rising interest rates can adversely affect the
availability and cost of financing for property acquisitions and
other purposes and reduce the value of a REIT's fixed income
investments
o The values of properties owned by a REIT or the prospects of other
real estate industry issuers may be hurt by property tax increases,
zoning changes, other governmental actions, environmental
liabilities, natural disasters or increased operating expenses
o A REIT in an underlying fund's portfolio is, or is perceived by the
market to be, poorly managed
Non-U.S. securities
Investing in non-U.S. issuers, including emerging market issuers, may involve unique risks compared to investing in securities of issuers in the U.S. These risks are more pronounced to the extent the fund invests in issuers in the lesser-developed emerging markets or in one region, such as Europe or the Pacific Rim. These risks may include:
o Less information about the non-U.S. issuers or markets may be
available due to less rigorous disclosure or accounting standards or
regulatory practices
o Adverse effect of currency exchange rates or controls on the value
of the fund's investments
o The economies of non-U.S. countries may grow at slower rates than
expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect
securities markets
o Withholding and other non-U.S. taxes may decrease the fund's return
High yield/below investment grade debt securities
Investment in high yield securities involves substantial risk of loss. These securities are considered speculative with respect to the issuer's ability to pay interest and principal and are susceptible to default or decline in market value due to adverse economic and business developments. The market values for high yield securities tend to be very volatile, and these securities are less liquid than investment grade debt securities. For these reasons, your investment in the fund is subject to the following specific risks:
o Increased price sensitivity to changing interest rates and
deteriorating economic environment
o Greater risk of loss due to default or declining credit quality
o Adverse company specific events are more likely to render the issuer
unable to make interest and/or principal payments
o A negative perception of the high yield market develops, depressing
the price and liquidity of high yield securities. This negative
perception could last for a significant period of time
Derivatives
Certain underlying funds may use futures and options on securities, indices and currencies, forward foreign currency exchange contracts and other derivatives. A derivative is a security or instrument whose value is determined by reference to the value or the change in value of one or more securities, currencies, indices or other financial instruments. The underlying funds may use derivatives for a variety of purposes, including:
o As a hedge against adverse changes in stock market prices, interest
rates or currency exchange rates
o As a substitute for purchasing or selling securities
o To increase the fund's return as a non-hedging strategy that may be
considered speculative
Even a small investment in derivatives can have a significant impact on a fund's exposure to stock market values, interest rates or currency exchange rates. If changes in a derivative's value do not correspond to changes in the value of the fund's other investments, the fund may not fully benefit from or could lose money on the derivative position. In addition, some derivatives involve risk of loss if the person who issued the derivative defaults on its obligation. Certain derivatives may be less liquid and more difficult to value.
Past Performance
Set forth below is performance information for AmSouth Strategic Portfolios: Growth & Income Portfolio. The bar charts show how AmSouth Strategic Portfolios: Growth & Income Portfolio's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The table shows average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Strategic Portfolios: Growth & Income Portfolio -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
2000 4.21% 2001 -2.29% 2002 -8.54% 2003 17.38% 2004 7.39% |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 9.52% for the quarter ended June 30, 2003, and the lowest quarterly return was -8.83% for the quarter ended September 30, 2002.
Pioneer Ibbotson Moderate Allocation Fund -- Class A Shares Calendar Year Total Returns
Pioneer Ibbotson Moderate Allocation Fund began investment operations in August 2004. Since the Pioneer Fund has conducted investment operations for less than one calendar year, it may not disclose any performance information in this prospectus. The fund's performance will vary from year to year. Past performance does not necessarily indicate how a fund will perform in the future. As a shareowner, you may lose or make money on your investment.
AmSouth Strategic Portfolios: Growth & Income Portfolio Average Annual Total Returns (for the periods ending December 31, 2004)
1 Year 5 Years Since Inception
(1/27/99)
------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Growth & Income Portfolio, Class A Shares
Return Before Taxes 1.46% 2.10% 2.69%
Return After Taxes on Distributions 0.98% 0.95% 1.61%
Return After Taxes on Distributions and Sale of Fund Shares 0.94% 1.18% 1.71%
AmSouth Strategic Portfolios: Growth & Income Portfolio, Class B Shares
Return Before Taxes 1.77% 2.16% 3.00%
AmSouth Strategic Portfolios: Growth & Income Portfolio, Class I Shares
Return Before Taxes 7.51% 3.32% 4.22%
Return After Taxes on Distributions 7.00% 2.14% 3.11%
Return After Taxes on Distributions and Sale of Fund Shares 4.87% 2.21% 3.02%
S&P 500 Index(1) 10.87% -2.30% 0.66%
(reflects no deduction for fees, expenses or taxes)
|
(1) The S&P 500 Index, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Strategic Portfolios:
Growth & Income Portfolio's returns. After-tax returns are only shown for Class
A shares and Class I shares and may vary for Class B shares. The Fund's
after-tax returns are calculated using the highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes. In
certain cases, the figure representing "Return After Taxes on Distributions and
Sale of Fund Shares" may be higher than the other return figures for the same
period. A higher after-tax return results when a capital loss occurs upon
redemption and translates into an assumed tax deduction that benefits the
shareholder. Please note that actual after-tax returns depend on an investor's
tax situation and may differ from those shown. Also note that after-tax returns
shown are not relevant to shareholders who hold Fund shares through tax-deferred
arrangements, such as 401(k) plans or individual retirement accounts.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Strategic Portfolios: Growth & Income Portfolio, the expenses of AmSouth Strategic Portfolios: Growth & Income Portfolio for the period ended January 31, 2005 and (ii) for Pioneer Ibbotson Moderate Allocation Fund, the estimated expenses for the period ended January 31, 2005. Future expenses for all share classes may be greater or less. Shareholders of AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio are also being asked to approve the reorganization of their fund into Pioneer Ibbotson Moderate Allocation Fund. The tables also show (1) the pro forma expenses of the combined Fund assuming the Reorganization occurred on January 31, 2005 and (2) the pro forma expenses of the combined Fund assuming the reorganization of AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio into Pioneer Ibbotson Moderate Allocation Fund also occurred on January 31, 2005.
Shareholder AmSouth Pioneer Combined Combined AmSouth
transaction Strategic Ibbotson Fund Fund Strategic
fees (paid Portfolios Moderate (Pro (including Portfolios
directly from Growth & Allocation Forma) AmSouth Growth &
your Income Fund Moderate Income
investment) Portfolio(1) Growth & Portfolio
Income
Portfolio)(Pro
Forma)
Class A Class A Class A Class A Class B
-------------------------------------------------------------------------------------------------
Maximum 5.50%(2) 5.75% 5.75% 5.75% None
sales charge
(load) when
you buy
shares as a
percentage of
offering price
-------------------------------------------------------------------------------------------------
Maximum None None None None 5.00%(3)
deferred sales
charge (load)
as a
percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
-------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None None 2.00%(4)
fees
-------------------------------------------------------------------------------------------------
|
Shareholder Pioneer Combined Combined AmSouth Combined Combined Fund
transaction Ibbotson Fund (Pro Fund Strategic Fund (Pro (including
fees (paid Moderate Forma) (including Portfolios Forma) AmSouth
directly from Allocation AmSouth Growth & Moderate
your Fund Moderate Income Growth &
investment) Growth & Portfolio Income
Income Portfolio) (Pro
Portfolio) Forma)
(Pro Forma)
Class B Class B Class B Class I Class Y(8) Class Y(8)
------------------------------------------------------------------------------------------------------------------------
Maximum None None None None None None
sales charge
(load) when
you buy
shares as a
percentage of
offering price
------------------------------------------------------------------------------------------------------------------------
Maximum 4.00% 4.00% 4.00% None None None
deferred sales
charge (load)
as a
percentage of
purchase price
or the amount
you receive
when you sell
shares,
whichever is
less
------------------------------------------------------------------------------------------------------------------------
Redemption None None None 2.00%(4) None None
fees
------------------------------------------------------------------------------------------------------------------------
|
Shareholder AmSouth Pioneer Combined Combined AmSouth
transaction Strategic Ibbotson Fund Fund Strategic
fees (paid Portfolios Moderate (Pro (including Portfolios
directly from Growth & Allocation Forma) AmSouth Growth &
your Income Fund Moderate Income
investment) Portfolio(1) Growth & Portfolio
Income
Portfolio)(Pro
Forma)
Class A Class A Class A Class A Class B
-------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as a
% of average
net assets)
-------------------------------------------------------------------------------------------------
Management 0.20% 0.17%(6) 0.17%(6) 0.17%(6) 0.20%
fee
-------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.25% 0.75%
and service
(12b-1) fee
-------------------------------------------------------------------------------------------------
Other 0.57% 0.68% 0.35% 0.32% 0.61%
expenses(5)
-------------------------------------------------------------------------------------------------
Estimated 1.50% 0.68% 0.68% 0.32% 2.24%
indirect
expenses
-------------------------------------------------------------------------------------------------
Total fund 2.27% 1.78%(7) 1.45% 1.42% 3.05%
operating
expenses
-------------------------------------------------------------------------------------------------
Expense 0.25% 0.20% N/A N/A 0.30%
reimbursement
/reduction
-------------------------------------------------------------------------------------------------
Net fund 2.02% 1.58% 1.45% 1.42% 2.75%
operating
expenses
-------------------------------------------------------------------------------------------------
|
Shareholder Pioneer Combined Combined AmSouth Combined Combined Fund
transaction Ibbotson Fund (Pro Fund Strategic Fund (Pro (including
fees (paid Moderate Forma) (including Portfolios Forma) AmSouth
directly from Allocation AmSouth Growth & Moderate
your Fund Moderate Income Growth &
investment) Growth & Portfolio Income
Income Portfolio) (Pro
Portfolio) Forma)
(Pro Forma)
Class B Class B Class B Class I Class Y(8) Class Y(8)
------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as a
% of average
net assets)
------------------------------------------------------------------------------------------------------------------------
Management 0.17%(6) 0.17%(6) 0.17%(6) 0.20% 0.17%(6) 0.17%(6)
fee
------------------------------------------------------------------------------------------------------------------------
Distribution 1.00% 1.00% 1.00% None None None
and service
(12b-1) fee
------------------------------------------------------------------------------------------------------------------------
Other 0.80% 0.80% 0.80% 0.47% 0.31% 0.27%
expenses(5)
------------------------------------------------------------------------------------------------------------------------
Estimated 0.68% 0.64% 0.56% 1.45% 0.31% 0.27%
indirect
expenses
------------------------------------------------------------------------------------------------------------------------
Total fund 2.65%(7) 2.49% 2.41% 2.12% 1.16% 1.12%
operating
expenses
------------------------------------------------------------------------------------------------------------------------
Expense 0.20% 0.01% N/A 0.20% N/A N/A
reimbursement
/reduction
------------------------------------------------------------------------------------------------------------------------
Net fund 2.45% 2.48% 2.41% 1.92% 1.16% 1.12%
operating
expenses
------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A Shares bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B Shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.32% for Class A shares, 0.31% for Class B shares and 0.27% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time. Pioneer has contractually agreed not to impose all or a portion of its fees or to limit other direct ordinary operating expenses to the extent required to reduce expenses, other than "Estimated average expense ratio of underlying funds," to 0.74% of the average daily net assets attributable to Class A shares and 1.64% of average daily net assets attributable to Class B shares. This expense limitation is in effect for Class A shares until December 1, 2008 and in effect for Class B until December 1, 2006. There can be no assurance that Pioneer will extend these expense limitations past such dates. The expense limitation does not limit the expenses of the underlying funds indirectly incurred by a shareholder.
(6) The management fee payable by the Pioneer Fund is equal to 0.13% of average daily net assets attributable to the Pioneer Fund's investments in underlying funds managed by Pioneer and cash and 0.17% of average daily net assets attributable to other investments, including underlying funds that are not managed by Pioneer, with breakpoints at incremental asset levels. Since initially all of the underlying funds are managed by Pioneer, the management fee will initially be 0.13% of average daily net assets.
(7) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(8) Class Y shares of the Pioneer Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Combined Fund
(including AmSouth
Strategic Portfolios:
AmSouth Strategic Moderate Growth &
Number of years you Portfolios: Growth & Pioneer Ibbotson Combined Fund Income Portfolio)
own your shares Income Portfolio Moderate Allocation Fund (Pro Forma) (Pro Forma)
-------------------- -------------------- ------------------------ ------------- ---------------------
Class A
--------------------------------------------------------------------------------------------------------------
Year 1 $ 737 $ 726 $ 714 $ 711
--------------------------------------------------------------------------------------------------------------
Year 3 $1,129 $1,085 $1,007 $ 998
--------------------------------------------------------------------------------------------------------------
Year 5 $1,544 N/A $1,322 $1,307
--------------------------------------------------------------------------------------------------------------
Year 10 $2,700 N/A $2,210 $2,179
--------------------------------------------------------------------------------------------------------------
Class B --- assuming redemption at end of period
--------------------------------------------------------------------------------------------------------------
Year 1 $ 777 $ 648 $ 651 $ 644
--------------------------------------------------------------------------------------------------------------
Year 3 $1,150 $1,104 $1,075 $1,051
--------------------------------------------------------------------------------------------------------------
Year 5 $1,650 N/A $1,425 $1,385
--------------------------------------------------------------------------------------------------------------
Year 10 $2,881 N/A $2,569 $2,501
--------------------------------------------------------------------------------------------------------------
Class B --- assuming no redemption
--------------------------------------------------------------------------------------------------------------
Year 1 $ 277 $ 248 $ 251 $ 244
--------------------------------------------------------------------------------------------------------------
Year 3 $ 850 $ 804 $ 775 $ 751
--------------------------------------------------------------------------------------------------------------
Year 5 $1,450 N/A $1,325 $1,285
--------------------------------------------------------------------------------------------------------------
Year 10 $2,881 N/A $2,569 $2,501
--------------------------------------------------------------------------------------------------------------
Class I Class Y
--------------------------------------------------------------------------------------------------------------
Year 1 $ 188 N/A $ 118 $ 114
--------------------------------------------------------------------------------------------------------------
Year 3 $ 582 N/A $ 368 $ 356
--------------------------------------------------------------------------------------------------------------
Year 5 $ 1001 N/A $ 638 $ 617
--------------------------------------------------------------------------------------------------------------
Year 10 $2,169 N/A $1,409 $1,363
--------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Strategic Portfolios: Growth & Income Portfolio. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your Amsouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Third, Pioneer Ibbotson Moderate Allocation Fund's management fee (0.17% of average daily net assets) is lower than the advisory fee of your Fund (0.20% of average daily net assets). Both the historical and estimated pro forma expenses of the Pioneer Fund, after giving effect to the Reorganization, on a gross and net basis are lower than your Fund's gross and net
operating expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares.
Fourth, because of Pioneer distribution arrangements, Pioneer Fund has greater potential to further increase the assets compared to your Fund. Further assets growth is anticipated to further reduce the combined Fund's gross operating expenses per share.
Fifth, the Class A, B and Y shares of the Pioneer Fund received in the Reorganization will provide AmSouth Fund shareholders with exposure to a similar investment product as they currently have. The Trustees also noted that the allocation decisions are made by Ibbotson, a leading asset allocation adviser, and that the Pioneer Fund intends, as soon as permitted by the Securities and Exchange Commission, to include unaffiliated mutual funds as underlying funds.
Sixth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares. Although the Reorganization will result in a per share decrease in capital loss carryforwards, the potential negative tax consequences of this aspect of the Reorganization are outweighed by the advantages of the Reorganization. The Reorganization will also result in a per share decrease in net unrealized capital gains.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of AmSouth Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio approve the reorganization of their fund into Pioneer Ibbotson Moderate Allocation Fund.
Pro Forma Pioneer
Ibbotson Moderate
Allocation Fund
(including
AmSouth Strategic
Portfolios:
AmSouth Strategic Pioneer Ibbotson Pro Forma Pioneer Moderate Growth
Portfolios: Growth & Moderate Allocation Ibbotson Moderate Income &
Income Portfolio Fund Fund Allocation Fund Portfolio)
May 31, 2005 May 31, 2005 May 31, 2005 May 31, 2005
--------------------- ------------------- ----------------- ------------------
Total Net Assets (in thousands) $ 113,640 $ 45,791 $ 159,430 $ 211,011
----------------------------------------------------------------------------------------------------------------------
Class A shares........... $ 55,716 $ 26,035 $ 81,751 $ 105,349
----------------------------------------------------------------------------------------------------------------------
Class B shares........... $ 19,098 $ 7,824 $ 26,923 $ 40,751
----------------------------------------------------------------------------------------------------------------------
Class I/Y shares......... $ 38,825 N/A $ 38,825 $ 52,979
Net Asset Value Per Share
----------------------------------------------------------------------------------------------------------------------
Class A shares........... $ 10.09 $ 10.77 $ 10.77 $ 10.77
----------------------------------------------------------------------------------------------------------------------
Class B shares........... $ 10.05 $ 10.42 $ 10.42 $ 10.42
----------------------------------------------------------------------------------------------------------------------
Class I/Y shares......... $ 10.13 N/A $ 10.77 $ 10.77
Shares Outstanding
----------------------------------------------------------------------------------------------------------------------
Class A shares........... 5,521,241 2,417,639 7,591,546 9,782,884
|
Class B shares........... 1,900,376 751,050 2,584,294 3,911,684 Class I/Y shares......... 3,832,756 N/A 3,605,325 4,919,719 |
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
Information about the underlying funds
The following is intended to summarize the investment objectives and primary strategies of, and to provide you with certain other information about, the underlying funds. These summaries do not reflect all of the investment policies and strategies that are disclosed in each underlying fund's prospectus, and are not an offer of the underlying funds' shares. The underlying funds in which the funds intend to invest may change from time to time and the funds may invest in underlying funds in addition to those described below at the discretion of Pioneer without prior notice to or approval of shareholders. The prospectus and SAI for each underlying fund is available on the SEC's website as well as on our website at www.pioneerfunds.com.
Each underlying fund normally will be invested according to its investment strategy. However, an underlying fund also may have the ability to invest without limitation in money market instruments or other investments for temporary, defensive purposes.
The underlying funds that invest primarily in equity securities are:
Pioneer Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund invests in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Research Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as preferred stocks, depositary receipts, rights and warrants.
Investment Adviser
Pioneer
Pioneer Growth Leaders Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in common and preferred stocks and securities convertible into stocks. Securities convertible into stocks include depositary receipts on stocks, convertible debt securities, warrants and rights. The fund offers a broad investment program for the equity portion of an investor's portfolio, with an emphasis on mid and large capitalization issuers traded in the U.S. However, the fund may invest in issuers of any capitalization.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Strategic Growth Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of U.S. issuers. The fund invests primarily in securities, traded in the U.S., of issuers that the subadviser believes have substantial international activities. In evaluating whether an issuer has substantial international activities, the subadviser considers the degree to which the issuer has non-U.S. reported sales and revenues, operating earnings or tangible assets. The fund may invest up to 20% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Large Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of large capitalization U.S. companies. Large capitalization companies have market capitalizations at the time of acquisition of $3 billion or more. The fund anticipates that the average weighted market capitalization of the companies in the fund's portfolio will be significantly higher that $3 billion. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer AmPac Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of issuers that have substantial sales to, or receive significant income from, countries within the Pacific Rim. These issuers meet one of the following criteria:
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries (including the U.S. and other countries bordering the Pacific Ocean, such as China and Indonesia)
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries other than the U.S.
The fund also may invest up to 30% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Value Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund seeks to invest in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Mid Cap Growth Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is, companies with market values within the range of market values of issuers included in the Russell Midcap Growth Index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer Cullen Value Fund
Investment objective
Capital appreciation. Current income is a secondary objective.
Principal investment strategies
The fund invests primarily in equity securities. The fund may invest a significant portion of its assets in equity securities of medium- and large-capitalization companies. Consequently, the fund will be subject to the risks of investing in companies with market capitalizations of $1.5 billion or more. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
The fund may invest up to 30% of its total assets in securities of non-U.S. issuers. Up to 5% of the fund's total assets may be invested in securities of emerging market issuers. The fund may invest in securities of Canadian issuers to the same extent as securities of U.S. issuers.
Investment Adviser
Pioneer
Pioneer Mid Cap Value Fund
Investment objective
Capital appreciation by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is companies with market values within the range of market values of companies included in the Russell Midcap Value Index. The fund focuses on issuers with capitalizations within the $1 billion to $10 billion range, and that range will change depending on market conditions. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer
Pioneer Small and Mid Cap Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small and mid-capitalization issuers, that is those with market values, at the time of investment, that do not exceed the market capitalization of the largest company within the S&P Mid Cap 400 Index. The size of the companies in the index may change dramatically as a result of market conditions and the composition of the index. The fund's investments will
not be confined to securities issued by companies included in an index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Small Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small capitalization U.S. companies with market capitalizations of $2 billion or less. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. Small capitalization companies have market capitalizations at the time of acquisition of $2 billion or less. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer Small Cap Value Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small companies. Small companies are those with market values, at the time of investment, that do not exceed the greater of the market capitalization of the largest company within the Russell 2000 Index or the 3-year rolling average of the market capitalization of the largest company within the Russell 2000 Index as measured at the end of the preceding month. The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The size of the companies in the index changes with market conditions and the composition of the index. Pioneer monitors the fund's portfolio so that, under normal circumstances, the capitalization range of the fund's portfolio is consistent with the inclusion of the fund in the Lipper Small-Cap category. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer International Equity Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. The fund focuses on securities of issuers located in countries with developed markets (other than the United States) but may allocate up to 10% of its assets in countries with emerging economies or securities markets. Developed markets outside the United States generally include, but are not limited to, the countries included in the Morgan Stanley Capital International Europe, Australasia, Far East Index. The fund's assets must be allocated to securities of issuers located in at least three non-U.S. countries. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer International Value Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. These issuers may be located in both developed and emerging markets. Under normal circumstances, the fund's assets will be invested in securities of companies domiciled in at least three different foreign countries. Generally, the fund's investments in any country are limited to 25% or less of its total assets. However, the fund may invest more than 25% of its assets in issuers organized in Japan or the United Kingdom or in securities quoted or denominated in the Japanese yen, the British pound and the euro. Investment of a substantial portion of the fund's assets in such countries or currencies will subject the fund to the risks of adverse securities markets, exchange rates and social, political or economic events which may occur in those countries.
The fund may invest without limitation in securities of issuers located in countries with emerging economies or securities markets, but will not invest more than 25% of its total assets in securities of issuers located in any one such country.
For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred shares. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer Europe Select Fund
Investment objective
Capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of European issuers. The fund's principal focus is on European companies that exhibit strong growth characteristics and are considered to be leaders in their sector or industry. The fund generally focuses on mid- and large-capitalization European issuers. Equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in connection with its investments.
Investment Adviser
Pioneer
Pioneer Emerging Markets Fund
Investment objective
Long-term growth of capital.
Principal investment strategies
The fund invests primarily in securities of emerging market issuers. Although the fund invests in both equity and debt securities, it normally emphasizes equity securities in its portfolio. Normally, the fund invests at least 80% of its total assets in the securities of emerging market corporate and government issuers (i.e., securities of companies that are domiciled or primarily doing business in emerging countries and securities of these countries' governmental issuers).
Investment Adviser
Pioneer
Pioneer Real Estate Shares
Investment objective
Long-term growth of capital. Current income is a secondary objective.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of real estate investment trusts (REITs) and other real estate industry issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as warrants, rights, interests in REITs and preferred stocks.
Investment Adviser
Pioneer (adviser); AEW Management and Advisors, L.P. (subadviser)
The underlying funds that invest primarily in debt securities are:
Pioneer Bond Fund
Investment objective
To provide current income from an investment grade portfolio with due regard to preservation of capital and prudent investment risk. The fund also seeks a relatively stable level of dividends; however, the level of dividends will be maintained only if consistent with preserving the investment grade quality of the fund's portfolio.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government or its agencies and instrumentalities,
o Debt securities, including convertible debt, of corporate and other issuers rated at least investment grade at the time of investment, and comparably rated commercial paper,
o Cash and cash equivalents, certificates of deposit, repurchase agreements maturing in one week or less and bankers' acceptances.
Normally, the fund invests at least 80% of its total assets in these securities. In addition, the fund may invest up to 20% of its total assets in debt securities rated below investment grade or, if unrated, of equivalent quality as determined by Pioneer. Cash and cash equivalents include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer High Yield Fund
Investment objective
Maximize total return through a combination of income and capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in below investment grade (high yield) debt securities and preferred stocks. These high yield securities may be convertible into the equity securities of the issuer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
Investment Adviser
Pioneer
Pioneer Short Term Income Fund
Investment objective
A high level of current income to the extent consistent with a relatively high level of stability of principal.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities
o Debt securities, including convertible debt, of corporate and other issuers and commercial paper
o Mortgage-backed and asset-backed securities
o Short-term money market instruments
Normally, at least 80% of the fund's net assets are invested in debt securities that are rated investment grade at the time of purchase or cash and cash equivalents. Cash and cash equivalents may include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer Cash Reserves Fund
Investment objective
High current income, preservation of capital and liquidity through investments in high-quality short-term securities.
Principal investment strategies
The fund seeks to maintain a constant net asset value of $1.00 per share by investing in high-quality, U.S. dollar denominated money market securities, including those issued by:
o U.S. and foreign banks
o U.S. and foreign corporate issuers
o The U.S. government and its agencies and instrumentalities
o Foreign governments
o Multinational organizations such as the World Bank
The fund may invest more than 25% of its total assets in U.S. government securities and obligations of U.S. banks. The fund may invest in any money market instrument that is a permissible investment for a money market fund under the rules of the Securities and Exchange Commission, including commercial paper, certificates of deposit, time deposits, bankers' acceptances, mortgage-backed and asset-backed securities, repurchase agreements, municipal obligations and other short-term debt securities.
Investment Adviser
Pioneer
Pioneer Strategic Income Fund
Investment objective
A high level of current income.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in debt securities. The fund has the flexibility to invest in a broad range of issuers and segments of the debt securities markets. Pioneer Investment Management, Inc., the fund's investment adviser, allocates the fund's investments among the following three segments of the debt markets:
o Below investment grade (high yield) securities of U.S. and non-U.S. issuers
o Investment grade securities of U.S. issuers
o Investment grade securities of non-U.S. issuers
Pioneer's allocations among these segments of the debt markets depend upon its outlook for economic, interest rate and political trends. The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities or non-U.S. governmental entities
o Debt securities of U.S. and non-U.S. corporate issuers, including convertible debt
o Mortgage-backed and asset-backed securities
The fund's investments may have fixed or variable principal payments and all types of interest rate payment and reset terms, including fixed rate, adjustable rate, zero coupon, contingent, deferred, payment in kind and auction rate features. The fund invests in securities with a broad range of maturities.
Depending upon Pioneer's allocation among market segments, up to 70% of the fund's total assets may be in debt securities rated below investment grade at the time of purchase or determined to be of equivalent quality by Pioneer. Up to 20% of the fund's total assets may be invested in debt securities rated below CCC by Standard & Poor's Ratings Group or the equivalent by another nationally recognized statistical rating organization or determined to be of equivalent credit quality by Pioneer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
As with all fixed income securities, the market values of convertible debt securities tend to decline as interest rates increase and, conversely, to increase as interest rates decline. However, when the market price of the common stock underlying a convertible security exceeds the conversion price, the convertible security tends to reflect the market price of the underlying common stock.
Depending upon Pioneer's allocation among market segments, up to 85% of the fund's total assets may be in debt securities of non-U.S. corporate and governmental issuers, including debt securities of corporate and governmental issuers in emerging markets.
Investment Adviser
Pioneer
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio and Pioneer Ibbotson Moderate Allocation Fund
PROPOSAL 1(m)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund is structured as a "fund of funds," which means all of its assets are invested in other mutual funds ("underlying funds"). Your Fund invests only in other AmSouth funds. Currently, the Pioneer Fund only invests in other Pioneer funds but is seeking an exemptive order from the Securities and Exchange Commission that would permit the Pioneer Fund to invest, in addition, in mutual funds that are not managed by Pioneer. To the extent that Pioneer receives an order from the Securities and Exchange Commission that permits Pioneer to invest in such other non-Pioneer underlying funds, Pioneer and the Pioneer Fund intend to rely on such order, subject to any applicable conditions of the order. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio to Pioneer Ibbotson Moderate Allocation Fund
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A series of Pioneer Ibbotson Asset Allocation
open-end management investment company Series, a diversified open-end management
organized as a Massachusetts business trust. investment company organized as a Delaware
statutory trust.
Net assets as of March 31, $50.6 million $34.3 million
2005
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Investment Subadviser:
Day-to-day management of AmSouth Strategic Ibbotson Associates Advisors, LLC ("Ibbotson")
Portfolios: Moderate Growth & Income Portfolio
is the responsibility of the AmSouth Strategy Portfolio Managers:
Committee, and no person is primarily Day-to-day management of Pioneer Ibbotson
responsible for making recommendations to the Moderate Allocation Fund is the responsibility
Committee. The Committee members consist of of portfolio managers and members of
John Boston, CFA, Fred Crown, CFA, Paige B. Ibbotson's Investment Committee headed by
Daniel, David M. Dasari, CFA, Joseph T. Roger Ibbotson. Roger Ibbotson founded
Keating, Ronald E. Lindquist, John Mark Ibbotson in 1977 and is the firm's Chairman.
McKenzie, Matt Smith, CFA, Brian B. Sullivan, Peng Chen, Ph.D., managing director and chief
CFA, Doug S. Williams and Jason Waters. investment officer at Ibbotson, conducts
research projects on asset allocation,
Mr. Boston is Chief Fixed Income Officer for portfolio risk measurement, nontraditional
AAMI. He began his career in investment assets, and global financial markets. Dr. Chen
management with AmSouth Bank in 1987 and has joined Ibbotson in 1997. Michael E. Annin,
been associated with AAMI since 1996. Mr. managing director, manages the investment
Boston received his CFA charter in 1993 and is management services and data products group
an active member and past president of for Ibbotson. Scott Wentsel, senior portfolio
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
the Alabama Society of Financial Analysts. He manager, is responsible for management of the
also serves as the portfolio manager for the firm's fund-of-funds business which includes
AmSouth High Quality Bond Fund. Mr. Boston is oversight of its investment management staff
a Senior Vice President of AmSouth Bank and and process. Alexander E. Kaye, portfolio
Vice President of AAMI. manager, is responsible for managing the
delivery of fund-of-funds programs for
Mr. Crown has been employed with AmSouth Bank institutional and retail clients, which
since 1982 and AAMI since 2001. He was an includes asset allocation modeling, portfolio
Institutional Fund Manager with AAMI construction, fund classification and manager
(2001-2003) and has been a Regional Manager due diligence. Brian Huckstep, portfolio
since 2003. Mr. Crown is a Senior Vice manager, is responsible for managing the
President of AmSouth Bank. delivery of fund-of-funds programs for
institutional and retail clients, which
Ms. Daniel has been employed with AmSouth Bank includes asset allocation modeling, portfolio
since 1999. She has been employed by AAMI as construction, fund classification, and manager
the Director of Alternative Strategies since due diligence.
2003. She is an Assistant Vice President with
AmSouth Bank.
Mr. Dasari has been employed with AmSouth Bank
since 2002 and AAMI since 2003. He is
Director of Individual Security Management for
AAMI. Prior to joining AmSouth Bank, he was
Assistant Vice President at Fifth Third Bank.
Mr. Dasari is a Vice President of AmSouth Bank.
Mr. Keating has been employed with AmSouth
Bank since 2001 and AAMI since 2002. He is
the Chairman and Chief Investment Officer of
AAMI. Prior to 2001, he was employed as the
Chief Market Strategist and Chief Fixed Income
Officer of Fifth Third Bank. Mr. Keating is
an Executive Vice-President of AmSouth Bank.
Mr. Lindquist has been employed with AAMI
since December 1999. Prior to December 1999,
Mr. Lindquist was employed by First American
National Bank (since May 1998), and by Deposit
Guaranty National Bank, and Commercial
National Bank (since 1978). First American
National Bank, Deposit Guaranty National Bank
and Commercial National Bank are predecessors
of AmSouth Bank and affiliates of AAMI. He
also serves as the portfolio manager for the
AmSouth Large Cap Fund. Mr. Lindquist is a
Senior Vice President of AmSouth Bank and Vice
President of AAMI.
Mr. McKenzie has been involved in investment
management since 1981, with portfolio
management expertise in both equity and fixed
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
income securities. Mr. McKenzie co-managed the
AmSouth Government Income Fund from 1999 to
2002 and managed it from 2003 to 2004. Mr.
McKenzie has been associated with the Trust
Investment Department of AmSouth Bank, and
banks acquired by AmSouth Bank, since 1984 and
joined AAMI in 2003. Mr. McKenzie is a Senior
Vice President of AmSouth Bank and Vice
President of AAMI.
Mr. Smith has been employed with AmSouth Bank
since 1988. He has been employed by AAMI as a
Regional Manager since 2004. He is a Senior
Vice President with AmSouth Bank.
Mr. Sullivan has been an officer of AAMI since
1996 and joined AmSouth Bank in 1984. Prior
to serving as Director of Fixed Income for
AmSouth Bank's Trust Department, Mr. Sullivan
managed equity portfolios and held the
position of equity research coordinator for
AmSouth Bank's Trust Department. Mr. Sullivan
is a Senior Vice President of AmSouth Bank and
Vice President of AAMI.
Mr. Waters has been employed with AmSouth Bank
since 1999. He has been employed as an
Institutional Portfolio Manager with AAMI
since 2001. Mr. Williams is a Senior Vice
President of AmSouth Bank.
Mr. Williams has been employed with AmSouth
Bank since 2002. He has been employed as a
Regional Manager with AAMI since 2004. Prior
to 2002, Mr. Williams was a Director of
Portfolio Management with Fifth Third Bank
(1988-2002). Mr. Williams is a Senior Vice
President of AmSouth Bank.
Investment objective AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio seeks to provide investors seeks long-term capital growth and current
with current income and a moderate level of income.
capital growth.
Primary investments Each Fund allocates its investments among underlying funds within pre-determined strategy
ranges.
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio:
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio allocates its assets among the
following underlying funds within the ranges set forth below based upon AAMI's outlook for the
economy, financial markets and relative market valuations of the underlying AmSouth Funds.
Underlying Fund Allocation Range
AmSouth Value Fund 0-15%
AmSouth Select Equity Fund 0-10%
AmSouth Enhanced Market Fund 0-15%
AmSouth Large Cap Fund 0-10%
AmSouth Capital Growth Fund 0-15%
AmSouth Mid Cap Fund 0-10%
AmSouth Small Cap Fund 0-10%
AmSouth International Equity Fund 0-10%
AmSouth Government Income Fund 0-25%
AmSouth High Quality Bond Fund 0-70%
AmSouth Limited Term Bond Fund 0-25%
AmSouth Prime Money Market Fund 0-5%
The selection of the underlying funds and their ranges are not fundamental and may be changed
without the prior approval of AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio's
shareholders.
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
Pioneer Ibbotson Moderate Allocation Fund:
Because this is a moderate allocation fund, the majority of Pioneer Ibbotson Moderate
Allocation Fund's assets will be invested in equity and bond funds, although a portion of its
assets will be invested in cash, cash equivalents, or in money market funds. Under normal
circumstances, Pioneer Ibbotson Moderate Allocation Fund initially expects to invest its assets
among asset classes in the following ranges:
Short-Term
Investments Equity Fund Fixed Income Fund
Allocation Allocation Allocation
---------------------------------------------------------
0-5% 55-65% 35-45%
Based upon the analysis described under "Asset allocation process," the fund initially expects
to invest its assets in underlying mutual funds within the following ranges:
Fund Name Percentage of Fund Holdings
-----------------------------------------------------------------------------------
Pioneer Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Research Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Growth Leaders Fund (formerly Pioneer
Papp Stock Fund) 0-20%
-----------------------------------------------------------------------------------
Pioneer Strategic Growth Fund (formerly Pioneer
Papp Strategic Growth Fund) 0-20%
-----------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer AmPac Growth Fund (formerly Pioneer Papp
America-Pacific Rim Fund) 0-20%
-----------------------------------------------------------------------------------
Pioneer Value Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Mid Cap Growth Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Mid Cap Value Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Small and Mid Cap Growth Fund (formerly
Pioneer Papp Small and Mid Cap Growth Fund) 0-20%
-----------------------------------------------------------------------------------
Pioneer Oak Ridge Small Cap Growth Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Small Cap Value Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer International Equity Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer International Value Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Europe Select Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Emerging Markets Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Real Estate Shares 0-20%
-----------------------------------------------------------------------------------
Pioneer High Yield Fund 0-20%
-----------------------------------------------------------------------------------
Pioneer Bond Fund 0-25%
-----------------------------------------------------------------------------------
Pioneer Strategic Income Fund 0-25%
-----------------------------------------------------------------------------------
Pioneer Short Term Income Fund 0-25%
-----------------------------------------------------------------------------------
Pioneer Cash Reserves Fund 0-20%
-----------------------------------------------------------------------------------
The Fund may change its target allocation to each asset class, the underlying fund in each
asset class (including adding or deleting funds) or target allocations to each underlying fund
without prior approval from or notice to shareholders. Certain of the Pioneer Funds into which
the AmSouth Funds are being reorganized are not currently included in the above list of funds
underlying the Pioneer Fund. Pioneer and Ibbotson may determine to include such additional
Pioneer Funds in the list of permitted investments for the Pioneer Fund into which your Fund is
being reorganized. Alternatively, Pioneer and Ibbotson may determine to hold those additional
Pioneer Funds temporarily until the Pioneer Fund's portfolio is rebalanced.
Appendix A contains a summary description of each of the underlying Pioneer funds.
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
Normally, the Fund invests substantially all of its assets in underlying funds to meet its
investment objective. However, the Fund may invest a portion of its assets in cash, cash
equivalents or in money market funds. The underlying funds may also invest a portion of their
assets in money market funds, securities with remaining maturities of less than one year, cash
equivalents or may hold cash. For temporary defensive purposes, including during periods of
unusual cash flows, the Fund and each of the underlying funds may depart from its principal
investment strategies and invest part or all of its assets in these securities or may hold
cash. During such periods, the Fund may not be able to achieve its investment objective. The
Fund intends to adopt a defensive strategy when Pioneer or Ibbotson believes securities in
which the Fund normally invests have extraordinary risks due to political or economic factors
and in other extraordinary circumstances.
Borrowing AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund may
& Income Portfolio may not borrow money or not borrow money, except on a temporary basis
issue senior securities, except that the Fund and to the extent permitted by applicable law,
may borrow from banks or enter into reverse the Fund may: (a) borrow from banks or through
repurchase agreements for temporary emergency reverse repurchase agreements in an amount up
purposes in amounts up to 33 1/3% of the value to 33 1/3% of the Fund's total assets
of its total assets at the time of such (including the amount borrowed); (b) borrow up
borrowing. AmSouth Strategic Portfolios: to an additional 5% of the Fund's assets for
Moderate Growth & Income Portfolio will not temporary purposes; (c) obtain such short-term
purchase securities while borrowings credits as are necessary for the clearance of
(including reverse repurchase agreements) in portfolio transactions; (d) purchase
excess of 5% of its total assets are securities on margin; and (e) engage in
outstanding. In addition, AmSouth Strategic transactions in mortgage dollar rolls that are
Portfolios: Moderate Growth & Income Portfolio accounted for as financings.
is permitted to participate in a credit
facility whereby the Fund may directly lend to
and borrow money from another AmSouth Fund for
temporary purposes, provided that the loans
are made in accordance with an order of
exemption from the SEC and any conditions
thereto.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different.
For a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with initial sales
Rule 12b-1 Fees sales charge of up to 5.50% of the offering charges up to 5.75% of the offering price,
price, which is reduced depending upon the which is reduced or waived for large purchases
amount invested or, in certain circumstances, and certain types of investors. At the time of
waived. Class A shares bought as part of an your purchase, your investment firm may
investment of $1 million or more are not receive a commission from Pioneer Funds
subject to an initial sales charge, but may be Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 2% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
Class A shares pay a shareholder servicing fee There is no CDSC, except in certain
(non 12b-1) of up to 0.25% of average daily circumstances when the initial sales charge is
net assets. waived.
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 2% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive a
continuously declines over six years, starting commission from PFD, the Fund's distributor,
with year one and ending in year seven from: at the time of your purchase of up to 2%.
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B
shares held continuously, the CDSC declines Class B shares are subject to distribution and
over six years, starting with year one and service (12b-1) fees of up to 1% of average
ending in year seven from: 5%, 4%, 3%, 3%, 2%, daily net assets.
1%. Eight years after purchase (seven years in
the case of shares acquired in the ISG Class B shares acquired through the
combination), Class B shares automatically Reorganization will be subject to the CDSC and
convert to Class A shares. commission schedules applicable to the
original purchase.
Class B shares pay a shareholder servicing fee
(non 12b-1) of up to 0.25% of average daily Maximum purchase of Class B shares in a single
net assets and a distribution (12b-1) fee of transaction is $49,999.
up to 0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y sales AmSouth Strategic Portfolios: Moderate Growth The Fund does not impose any initial,
charges and Rule 12b-1 fees & Income Portfolio does not impose any initial contingent deferred or asset based sales
or CDSC on Class I shares. charge on Class Y shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average distributing the Fund's Class Y shares, none
daily net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth Strategic Portfolios: Moderate Growth The management fee payable by Pioneer Ibbotson
& Income Portfolio pays an advisory fee on a Moderate Allocation Fund is equal to 0.13% of
monthly basis at an annual rate of 0.20% of average daily net assets attributable to the
the Fund's average daily net assets. Fund's investments in underlying funds managed
by Pioneer and cash and 0.17% of average daily
ASO Services Company, Inc. ("ASO") serves as net assets attributable to other investments,
administrator and fund accounting agent for including underlying funds that are not
the Fund. The Fund pays ASO an administrative managed by Pioneer, with breakpoints at
services fee of 0.15% of the Fund's average incremental asset levels. Since currently all
daily net assets. of the underlying funds are managed by
Pioneer, the management fee will initially be
Other expenses of the Fund are being limited 0.13% of average daily net assets.
to 0.38% for Class A shares, 0.37% for Class B
shares and 0.33% for Class I shares. Any fee In addition, the Fund reimburses Pioneer for
waiver or expense reimbursement arrangement is certain fund accounting and legal expenses
voluntary and may be discontinued at any incurred on behalf of the Fund and pays a
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
time. You also indirectly bear a pro rata separate shareholder servicing/transfer agency
share of the fees and expenses of the fee to PIMSS, an affiliate of Pioneer.
underlying funds.
Pioneer has contractually agreed not to impose
For the fiscal year ended July 31, 2004, the all or a portion of its fees or to limit other
Fund's annual operating expenses for Class A direct ordinary operating expenses to the
shares, after giving effect to the expense extent required to reduce expenses, other than
limitation were 0.58%, and without giving "Estimated average expense ratio of underlying
effect to the expense limitation, were 0.81% funds," to 0.74% of the average daily net
of average daily net assets. As of January assets attributable to Class A shares and
12, 2005, estimated total direct and indirect 1.52% of average daily net assets attributable
expenses were 1.94% of average daily net to Class B shares. There is no expense
assets. limitation with respect to the Class Y shares.
This expense limitation is in effect for Class
For the fiscal year ended July 31, 2004, the A shares until December 1, 2008 and in effect
Fund's annual operating expenses for Class B for Class B shares until December 1, 2006.
shares, after giving effect to the expense There can be no assurance that Pioneer will
limitation were 1.32%, and without giving extend these expense limitations past such
effect to the expense limitation, were 1.55% dates. The expense limitation does not limit
of average daily net assets. As of January 12, the expenses of the underlying funds
2005, estimated total direct and indirect indirectly incurred by a shareholder.
expenses were 2.68% of average daily net
assets. Class Y shares of the Pioneer Fund are being
offered for the first time in connection with
For the fiscal year ended July 31, 2004, the the Reorganization.
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.53%, and without giving
effect to the expense limitation, were 0.76%
of average daily net assets. As of January 12,
2005, estimated total direct and indirect
expenses were 1.84% of average daily net
assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000.
requirements for the Fund into which you are
exchanging. Exchanges from one fund to another After you establish an eligible fund account,
are taxable. Class A shares may be exchanged you can exchange fund shares by telephone or
for Class I shares of the same Fund or another online.
AmSouth Fund if you
|
AmSouth Strategic Portfolios: Moderate Growth Pioneer Ibbotson Moderate Allocation Fund
& Income Portfolio
------------------------------------------------------------------------------------------------------------------------------
become eligible to purchase Class I shares.
Class I shares may be exchanged for Class A
shares of the same fund. No transaction fees
are currently charged for exchanges.
If you sell your shares or exchange them for
shares of another AmSouth Fund within 7
days of the date of purchase, you will be
charged a 2.00% fee on the current net asset
value of the shares sold or exchanged. The
fee is paid to the Fund to offset the costs
associated with short-term trading, such as
portfolio transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares purchased
first will be considered redeemed first for
purposes of determining whether the redemption
fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator
or brokerage firm to implement the fee). The
Fund will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Pioneer Fund by telephone
or online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on an investment in a Fund or a Fund may not perform as well as other investment options.
Fund of funds structure and layering of fees
Each Fund is structured as a fund of funds. Each Fund's investments are focused in the underlying funds, so the Fund's investment performance is directly related to the performance of the underlying funds. Each Fund's net asset value will be affected by the performance of the equity and bond markets and the value of the mutual funds in which the fund invests. Since the Funds mainly invest in the underlying funds, as opposed to other types of securities, the Funds do not have the same flexibility in their portfolio holdings as many mutual funds. In addition, each Fund indirectly pays a portion of the expenses incurred by the underlying funds. Consequently, an investment in a Fund entails more direct and indirect expenses than a direct investment in the underlying funds. For instance, you will pay management fees and operating expenses of both the Fund and the underlying funds.
The underlying funds will not necessarily make consistent investment decisions, which may also increase your costs. One underlying fund may buy the same security that another underlying fund is selling. You would indirectly bear the costs of both trades without achieving any investment purpose. These transactions may also generate taxable gains. You may receive taxable gains from portfolio transactions by the underlying funds as well as taxable gains from the Fund's transactions in shares of the underlying funds.
Currently, Pioneer manages all of the funds underlying the Pioneer Fund. Because the portfolio management teams of each of the underlying Pioneer funds may draw upon the resources of the same equity and fixed income analyst team or may share common investment management styles or approaches, the underlying funds may hold many common portfolio positions, reducing the diversification benefits of an asset allocation style.
Equity investments
Equity funds invest primarily in equity securities (such as stocks), which are more volatile and carry more risks than some other forms of investment. When the value of the stocks held by an underlying equity fund goes down, the value of your investment in the fund will be affected.
The underlying equity funds have risks associated with investing in equity securities. An equity fund could underperform other investments if:
o The stock market goes down (this risk may be greater in the short
term)
o The fund's equity investments do not have the growth potential or
value characteristics originally expected
o Stocks selected for income do not achieve the same return as
securities selected for capital growth
o The types of stocks in which the fund invests or the fund's
investment approach fall out of favor with investors
Fixed income investments
Fixed income funds primarily invest in debt securities, such as government securities, investment grade corporate securities, junk bonds, mortgaged backed securities, asset-backed securities, and money market securities. The value of your investment in the fund will change as the value of investments of the underlying funds increases and decreases.
The underlying fixed income funds have risks associated with investing in debt securities. A fund could underperform other investments if:
o Interest rates go up causing the value of the fund's portfolio to
decline
o The issuer of a debt security owned by the fund defaults on its
obligation to pay principal or interest or has its credit rating
downgraded
o During periods of declining interest rates, the issuer of a security
may exercise its option to prepay earlier than scheduled, forcing
the fund to reinvest in lower yielding securities. This is known as
call or prepayment risk
o During periods of rising interest rates, the average life of certain
types of securities may be extended because of slower than expected
principal payments. This may lock in a below market interest rate,
increase the security's duration (the estimated period until the
security is paid in full) and reduce the value of the security. This
is known as extension risk
o The investment manager's judgment about the attractiveness, relative
value or potential appreciation of a particular sector, security or
investment strategy proves to be incorrect
Equity securities of smaller companies
Compared to large companies, small and mid-sized companies, and the market for their equity securities, are likely to:
o Be more sensitive to changes in the economy, earnings results and
investor expectations
o Have more limited product lines and capital resources
o Experience sharper swings in market values
o Be harder to sell at the times and prices Pioneer thinks appropriate
o Offer greater potential for loss than other U.S. equity securities
Equity securities of real estate industry issuers
Specific risks associated with the real estate industry include:
o The U.S. or a local real estate market declines due to adverse
economic conditions, overbuilding and high vacancy rates, reduced or
regulated rents or other causes
o Interest rates go up. Rising interest rates can adversely affect the
availability and cost of financing for property acquisitions and
other purposes and reduce the value of a REIT's fixed income
investments
o The values of properties owned by a REIT or the prospects of other
real estate industry issuers may be hurt by property tax increases,
zoning changes, other governmental actions, environmental
liabilities, natural disasters or increased operating expenses
o A REIT in an underlying fund's portfolio is, or is perceived by the
market to be, poorly managed
Non-U.S. securities
Investing in non-U.S. issuers, including emerging market issuers, may involve unique risks compared to investing in securities of issuers in the U.S. These risks are more pronounced to the extent the fund invests in issuers in the lesser-developed emerging markets or in one region, such as Europe or the Pacific Rim. These risks may include:
o Less information about the non-U.S. issuers or markets may be
available due to less rigorous disclosure or accounting standards or
regulatory practices
o Adverse effect of currency exchange rates or controls on the value
of the fund's investments
o The economies of non-U.S. countries may grow at slower rates than
expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect
securities markets
o Withholding and other non-U.S. taxes may decrease the fund's return
High yield/below investment grade debt securities
Investment in high yield securities involves substantial risk of loss. These securities are considered speculative with respect to the issuer's ability to pay interest and principal and are susceptible to default or decline in market value due to adverse economic and business developments. The market values for high yield securities tend to be very volatile, and these securities are less liquid than investment grade debt securities. For these reasons, your investment in the fund is subject to the following specific risks:
o Increased price sensitivity to changing interest rates and
deteriorating economic environment
o Greater risk of loss due to default or declining credit quality
o Adverse company specific events are more likely to render the issuer
unable to make interest and/or principal payments
o A negative perception of the high yield market develops, depressing
the price and liquidity of high yield securities. This negative
perception could last for a significant period of time
Derivatives
Certain underlying funds may use futures and options on securities, indices and currencies, forward foreign currency exchange contracts and other derivatives. A derivative is a security or instrument whose value is determined by reference to the value or the change in value of one or more securities, currencies, indices or other financial instruments. The underlying funds may use derivatives for a variety of purposes, including:
o As a hedge against adverse changes in stock market prices, interest
rates or currency exchange rates
o As a substitute for purchasing or selling securities
o To increase the fund's return as a non-hedging strategy that may be
considered speculative
Even a small investment in derivatives can have a significant impact on a fund's exposure to stock market values, interest rates or currency exchange rates. If changes in a derivative's value do not correspond to changes in the value of the fund's other investments, the fund may not fully benefit from or could lose money on the derivative position. In addition, some derivatives involve risk of loss if the person who issued the derivative defaults on its obligation. Certain derivatives may be less liquid and more difficult to value.
Past Performance
Set forth below is performance information for AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio. The bar chart shows how AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The table shows average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar chart gives an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
2000 0.59% 2001 -5.77% 2002 -13.33% 2003 21.81% 2004 2.89% |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 7.94% for the quarter ended June 30, 2003, and the lowest quarterly return was -6.80% for the quarter ended September 30, 2002.
Pioneer Ibbotson Moderate Allocation Fund -- Class A Shares Calendar Year Total Returns
Pioneer Ibbotson Moderate Allocation Fund began investment operations in August 2004.
Since the Pioneer Fund has conducted investment operations for less than one calendar year, it may not disclose any performance information in this prospectus. The Fund's performance will vary from year to year. Past performance does not necessarily indicate how a fund will perform in the future. As a shareowner, you may lose or make money on your investment.
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio Average Annual Total Returns (for the periods ending December 31, 2004)
Since Inception
1 Year 5 Years (1/28/99)
---------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio, Class A Shares
---------------------------------------------------------------------------------------------------------------------
Return Before Taxes 0.59% 2.90% 3.04%
---------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 0.00% 1.70% 1.87%
---------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 0.37% 1.80% 1.93%
---------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio, Class B Shares
---------------------------------------------------------------------------------------------------------------------
|
Since Inception
1 Year 5 Years (1/28/99)
---------------------------------------------------------------------------------------------------------------------
Return Before Taxes 0.75% 2.96% 2.90%
---------------------------------------------------------------------------------------------------------------------
AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio, Class I Shares
---------------------------------------------------------------------------------------------------------------------
Return Before Taxes 6.59% 4.14% 4.13%
---------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 5.95% 2.90% 2.91%
---------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 4.26% 2.85% 2.81%
---------------------------------------------------------------------------------------------------------------------
S&P 500 Index(1) 10.87% -2.30% 0.66%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------------
|
(1) The S&P 500, an unmanaged index of 500 stocks, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Strategic Portfolios:
Moderate Growth & Income Portfolio's returns. After-tax returns are only shown
for Class A shares and Class I shares and may vary for Class B shares. The
Fund's after-tax returns are calculated using the highest individual federal
marginal income tax rates and do not reflect the impact of state and local
taxes. In certain cases, the figure representing "Return After Taxes on
Distributions and Sale of Fund Shares" may be higher than the other return
figures for the same period. A higher after-tax return results when a capital
loss occurs upon redemption and translates into an assumed tax deduction that
benefits the shareholder. Please note that actual after-tax returns depend on an
investor's tax situation and may differ from those shown. Also note that
after-tax returns shown are not relevant to shareholders who hold Fund shares
through tax-deferred arrangements, such as 401(k) plans or individual retirement
accounts.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly
or indirectly. The tables below show the fees and expenses that you would pay if
you were to buy and hold shares of each Fund. The expenses in the tables
appearing below are based on (i) for the AmSouth Strategic Portfolios: Moderate
Growth & Income Portfolio, the expenses of AmSouth Strategic Portfolios:
Moderate Growth & Income Portfolio for the period ended January 31, 2005 and
(ii) for Pioneer Ibbotson Moderate Allocation Fund, the estimated expenses for
the period ended January 31, 2005. Future expenses for all share classes may be
greater or less. Shareholders of AmSouth Strategic Portfolios: Growth & Income
Portfolio are also being asked to approve the reorganization of their fund into
Pioneer Ibbotson Moderate Allocation Fund. The tables also show (1) the pro
forma expenses of the combined Fund assuming the Reorganization occurred on
January 31, 2005 and (2) the pro forma expenses of the combined Fund assuming
the reorganization of AmSouth Strategic Portfolios: Growth & Income Portfolio
into Pioneer Ibbotson Moderate Allocation Fund also occurred on January 31,
2005.
Shareholder AmSouth Pioneer Combined Combined Fund AmSouth Pioneer
transaction Strategic Ibbotson Fund (including Strategic Ibbotson
fees (paid Portfolios Moderate (Pro AmSouth Portfolios Moderate
directly from Moderate Allocation Forma) Growth & Moderate Allocation
your Growth & Fund Income Growth & Fund
investment) Income Portfolio) Income
Portfolio(1) (Pro Forma) Portfolio
------------------------------------------------------------------------------------------------
Class A Class A Class A Class A Class B Class B
------------------------------------------------------------------------------------------------
Maximum sales 5.50%(2) 5.75% 5.75% 5.75% None None
charge (load)
when you buy
shares as a
percentage of
offering price
------------------------------------------------------------------------------------------------
Maximum None None None None 5.00%(3) 4.00%
deferred
sales charge
(load) as a
percentage of
purchase
price or the
amount you
receive when
you sell
shares,
whichever is
less
------------------------------------------------------------------------------------------------
Redemption 2.00%(4) None None None 2.00%(4) None
fees
------------------------------------------------------------------------------------------------
Shareholder Combined Combined AmSouth Combined Combined Fund
transaction Fund (Pro Fund Strategic Fund (Pro (including
fees (paid Forma) (including Portfolios Forma) AmSouth
directly from AmSouth Moderate Growth &
your Growth & Growth & Income
investment) Income Income Portfolio)
Portfolio) Portfolio (Pro Forma)
(Pro Forma)
-------------------------------------------------------------------------------------
Class B Class B Class I Class Y(8) Class Y(8)
-------------------------------------------------------------------------------------
Maximum sales None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
-------------------------------------------------------------------------------------
Maximum 4.00% 4.00% None None None
deferred
sales charge
(load) as a
percentage of
purchase
price or the
amount you
receive when
you sell
shares,
whichever is
less
-------------------------------------------------------------------------------------
Redemption None None 2.00%(4)) None None
fees
-------------------------------------------------------------------------------------
|
Shareholder AmSouth Pioneer Combined Combined Fund AmSouth Pioneer
transaction Strategic Ibbotson Fund (including Strategic Ibbotson
fees (paid Portfolios Moderate (Pro AmSouth Portfolios Moderate
directly from Moderate Allocation Forma) Growth & Moderate Allocation
your Growth & Fund Income Growth & Fund
investment) Income Portfolio) Income
Portfolio(1) (Pro Forma) Portfolio
------------------------------------------------------------------------------------------------
Class A Class A Class A Class A Class B Class B
------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as a
% of average
net assets)
------------------------------------------------------------------------------------------------
Management fee 0.20% 0.17%(6) 0.17%(6) 0.17%(6) 0.20% 0.17%(6)
------------------------------------------------------------------------------------------------
Distribution None 0.25% 0.25% 0.25% 0.75% 1.00%
and service
(12b-1) fee
------------------------------------------------------------------------------------------------
Other 0.68% 0.68% 0.65% 0.32%(5) 0.71% 0.80%
expenses(5)
------------------------------------------------------------------------------------------------
Estimated 1.49% 0.68% 0.68% 0.68% 2.24% 0.68%
indirect
expenses
------------------------------------------------------------------------------------------------
Total fund
operating 2.37% 1.90%(7) 1.75% 1.42% 3.90% 2.65%(7)
expenses
------------------------------------------------------------------------------------------------
Expense 0.35% 0.19 0.17% N/A 0.38% 0.45%
reimbursement/
reduction
------------------------------------------------------------------------------------------------
Net fund 2.02% 1.71% 1.58% 1.42% 3.52% 2.20%
operating
expenses
------------------------------------------------------------------------------------------------
Shareholder Combined Combined AmSouth Combined Combined Fund
transaction Fund (Pro Fund Strategic Fund (Pro (including
fees (paid Forma) (including Portfolios Forma) AmSouth
directly from AmSouth Moderate Growth &
your Growth & Growth & Income
investment) Income Income Portfolio)
Portfolio) Portfolio (Pro Forma)
(Pro Forma)
-------------------------------------------------------------------------------------
Class B Class B Class I Class Y(8) Class Y(8)
-------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted
from fund
assets) (as a
% of average
net assets)
-------------------------------------------------------------------------------------
Management fee 0.17%(6) 0.17%(6) 0.20% 0.17%(6) 0.17%(6)
-------------------------------------------------------------------------------------
Distribution 1.00% 1.00% None None None
and service
(12b-1) fee
-------------------------------------------------------------------------------------
Other 0.87% 0.56% 0.59% 0.57% 0.27%
expenses(5)
-------------------------------------------------------------------------------------
Estimated 0.68% 0.68% 1.44% 0.68% 0.68%
indirect
expenses
-------------------------------------------------------------------------------------
Total fund
operating 2.72% 2.41% 2.23% 1.42% 1.12%
expenses
-------------------------------------------------------------------------------------
Expense 0.52% 0.21 0.31% N/A N/A
reimbursement/
reduction
-------------------------------------------------------------------------------------
Net fund 2.20% 2.20% 1.92% 1.42% 1.12%
operating
expenses
-------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines
over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.33% for Class A shares, 0.33% for Class B shares and 0.28% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time. Pioneer has contractually agreed not to impose all or a portion of its fees or to limit other direct ordinary operating expenses to the extent required to reduce expenses, other than "Estimated average expense ratio of underlying funds," to 0.74% of the average daily net assets attributable to Class A shares and 1.52% of average daily net assets attributable to Class B shares. This expense limitation is in effect for Class A shares until December 1, 2008 and in effect for Class B until December 1, 2006. There can be no assurance that Pioneer will extend these expense limitations past such dates. The expense limitation does not limit the expenses of the underlying funds indirectly incurred by a shareholder.
(6) The management fee payable by the Pioneer Fund is equal to 0.13% of average daily net assets attributable to the Pioneer Fund's investments in underlying funds managed by Pioneer and cash and 0.17% of average daily net assets attributable to other investments, including underlying funds that are not managed by Pioneer, with breakpoints at incremental asset levels. Since initially all of the underlying funds are managed by Pioneer, the management fee will initially be 0.13% of average daily net assets.
(7) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(8) Class Y shares of the Pioneer Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Combined Fund
(including AmSouth
Strategic
AmSouth Strategic Portfolios:
Portfolios: Moderate Pioneer Ibbotson Growth & Income
Number of years you Growth & Income Moderate Allocation Combined Fund Portfolio)
own your shares Portfolio Fund (Pro Forma) (Pro Forma)
---------------------------------------------------------------------------------------------------------------
Class A
---------------------------------------------------------------------------------------------------------------
Year 1 $ 747 $ 726 $ 726 $ 711
---------------------------------------------------------------------------------------------------------------
Year 3 $ 1,157 $1,085 $ 1,045 $ 998
---------------------------------------------------------------------------------------------------------------
Year 5 $ 1,593 N/A $ 1,422 $1,307
---------------------------------------------------------------------------------------------------------------
Year 10 $ 2,798 N/A $ 2,477 $2,179
---------------------------------------------------------------------------------------------------------------
Class B --- assuming redemption at end of period
---------------------------------------------------------------------------------------------------------------
Year 1 $ 786 $ 648 $ 651 $ 644
---------------------------------------------------------------------------------------------------------------
Year 3 $ 1,177 $1,104 $ 1,122 $1,051
---------------------------------------------------------------------------------------------------------------
Year 5 $ 1,694 N/A $ 1,518 $1,385
---------------------------------------------------------------------------------------------------------------
Year 10 $ 2,971 N/A $ 2,800 $2,501
---------------------------------------------------------------------------------------------------------------
Class B --- assuming no redemption
---------------------------------------------------------------------------------------------------------------
Year 1 $ 286 $248 $ 251 $ 244
---------------------------------------------------------------------------------------------------------------
Year 3 $ 877 $804 $ 822 $ 751
---------------------------------------------------------------------------------------------------------------
Year 5 $ 1,494 N/A $ 1,418 $1,285
---------------------------------------------------------------------------------------------------------------
Year 10 $ 2,971 N/A $ 2,800 $2,501
---------------------------------------------------------------------------------------------------------------
Class I Class Y
---------------------------------------------------------------------------------------------------------------
Year 1 $ 199 N/A $ 145 $ 114
---------------------------------------------------------------------------------------------------------------
Year 3 $ 615 N/A $ 449 $ 356
---------------------------------------------------------------------------------------------------------------
Year 5 $ 1057 N/A $ 776 $ 617
---------------------------------------------------------------------------------------------------------------
Year 10 $ 2,285 NA $ 1,702 $1,363
---------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Strategic Portfolios: Moderate Growth & Income Portfolio. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $15.7 billion in fixed income securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Third, Pioneer Ibbotson Moderate Allocation Fund's management fee (0.17% of average daily net assets) is lower than the advisory fee of your Fund (0.20% of average daily net assets). Both the historical and estimated pro forma expenses of the Pioneer Fund, after giving effect to the Reorganization, on a gross and net basis are lower than your Fund's gross and net operating expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares.
Fourth, because of Pioneer distribution arrangements, Pioneer Fund has greater potential to further increase the assets compared to your Fund. Further assets growth is anticipated to further reduce the combined Fund's gross operating expenses per share.
Fifth, the Class A, B and Y shares of the Pioneer Fund received in the Reorganization will provide AmSouth Fund shareholders with exposure to a similar investment product as they currently have. The Trustees also noted that the allocation decision was made by Ibbotson, a leading asset allocation adviser, and that the Pioneer Fund intends, as soon as permitted by the SEC, to include unaffiliated mutual funds as underlying funds.
Sixth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of AmSouth Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Strategic Portfolios: Growth & Income Portfolio approve the reorganization of their fund into Pioneer Ibbotson Moderate Allocation Fund.
Pro Forma
Pioneer
Ibbotson
Moderate
Allocation Fund
(including
Pro Forma AmSouth
Pioneer Strategic
AmSouth Strategic Pioneer Ibbotson Portfolios:
Portfolios: Ibbotson Moderate Growth &
Moderate Growth Moderate Allocation Income
& Income Portfolio Allocation Fund Fund Portfolio)
May 31, 2005 May 31, 2005 May 31, 2005 May 31, 2005
------------------ --------------- ------------ ---------------
Total Net Assets (in thousands) $ 51,581 $ 45,791 $ 97,372 $ 211,011
Class A shares ........... $ 23,598 $ 26,035 $ 49,633 $ 105,349
Class B shares ........... $ 13,828 $ 7,824 $ 21,653 $ 40,751
Class I/Y shares ......... $ 14,154 N/A $ 14,154 $ 52,979
Net Asset Value Per Share
Class A shares ........... $ 10.01 $ 10.77 $ 10.77 $ 10.77
Class B shares ........... $ 9.96 $ 10.42 $ 10.42 $ 10.42
Class I/Y shares ......... $ 10.04 N/A $ 10.77 $ 10.77
Shares Outstanding
Class A shares ........... 2,356,370 2,417,639 4,608,977 9,782,884
|
Class B shares ........... 1,389,040 751,050 2,078,440 3,911,684 Class I/Y shares ......... 1,409,269 N/A 1,314,394 4,919,719 |
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
Appendix A
Information about the underlying funds
The following is intended to summarize the investment objectives and primary strategies of, and to provide you with certain other information about, the underlying funds. These summaries do not reflect all of the investment policies and strategies that are disclosed in each underlying fund's prospectus, and are not an offer of the underlying funds' shares. The underlying funds in which the funds intend to invest may change from time to time and the funds may invest in underlying funds in addition to those described below at the discretion of Pioneer without prior notice to or approval of shareholders. The prospectus and SAI for each underlying fund is available on the SEC's website as well as on our website at www.pioneerfunds.com.
Each underlying fund normally will be invested according to its investment strategy. However, an underlying fund also may have the ability to invest without limitation in money market instruments or other investments for temporary, defensive purposes.
The underlying funds that invest primarily in equity securities are:
Pioneer Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund invests in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Research Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as preferred stocks, depositary receipts, rights and warrants.
Investment Adviser
Pioneer
Pioneer Growth Leaders Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in common and preferred stocks and securities convertible into stocks. Securities convertible into stocks include depositary receipts on stocks, convertible debt securities, warrants and rights. The fund offers a broad investment program for the equity portion of an investor's portfolio, with an emphasis on mid and large capitalization issuers traded in the U.S. However, the fund may invest in issuers of any capitalization.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Strategic Growth Fund
Investment objective
Long term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of U.S. issuers. The fund invests primarily in securities, traded in the U.S., of issuers that the subadviser believes have substantial international activities. In evaluating whether an issuer has substantial international activities, the subadviser considers the degree to which the issuer has non-U.S. reported sales and revenues, operating earnings or tangible assets. The fund may invest up to 20% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Large Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of large capitalization U.S. companies. Large capitalization companies have market capitalizations at the time of acquisition of $3 billion or more. The fund anticipates that the average weighted market capitalization of the companies in the fund's portfolio will be significantly higher that $3 billion. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer AmPac Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of issuers that have substantial sales to, or receive significant income from, countries within the Pacific Rim. These issuers meet one of the following criteria:
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries (including the U.S. and other countries bordering the Pacific Ocean, such as China and Indonesia)
o 50% or more of the issuer's earnings or sales are attributed to, or assets are situated in, Pacific Rim countries other than the U.S.
The fund also may invest up to 30% of the value of its investments in equity securities of non-U.S. issuers that are traded in U.S. markets.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Value Fund
Investment objective
Reasonable income and capital growth.
Principal investment strategies
The fund seeks to invest in a broad list of carefully selected, reasonably priced securities rather than in securities whose prices reflect a premium resulting from their current market popularity. The fund invests the major portion of its assets in equity securities, primarily of U.S. issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer
Pioneer Mid Cap Growth Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is, companies with market values within the range of market values of issuers included in the Russell Midcap Growth Index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer Cullen Value Fund
Investment objective
Capital appreciation. Current income is a secondary objective.
Principal investment strategies
The fund invests primarily in equity securities. The fund may invest a significant portion of its assets in equity securities of medium- and large-capitalization companies. Consequently, the fund will be subject to the risks of investing in companies with market capitalizations of $1.5 billion or more. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
The fund may invest up to 30% of its total assets in securities of non-U.S. issuers. Up to 5% of the fund's total assets may be invested in securities of emerging market issuers. The fund may invest in securities of Canadian issuers to the same extent as securities of U.S. issuers.
Investment Adviser
Pioneer
Pioneer Mid Cap Value Fund
Investment objective
Capital appreciation by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of mid-size companies, that is companies with market values within the range of market values of companies included in the Russell Midcap Value Index. The fund focuses on issuers with capitalizations within the $1 billion to $10 billion range, and that range will change depending on market conditions. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer
Pioneer Small and Mid Cap Growth Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small and mid-capitalization issuers, that is those with market values, at the time of investment, that do not exceed the market capitalization of the largest company within the S&P Mid Cap 400 Index. The size of the companies in the index may change dramatically as a result of market conditions and the composition of the index. The fund's investments will
not be confined to securities issued by companies included in an index. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks.
Investment Adviser
Pioneer (adviser); L. Roy Papp & Associates, LLP (subadviser)
Pioneer Oak Ridge Small Cap Growth Fund
Investment objective
Capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small capitalization U.S. companies with market capitalizations of $2 billion or less. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. Small capitalization companies have market capitalizations at the time of acquisition of $2 billion or less. The equity securities in which the fund principally invests are common stocks, preferred stocks, depositary receipts and convertible debt, but the fund may invest in other types of equity securities to a lesser extent, such as warrants and rights.
Investment Adviser
Pioneer (adviser); Oak Ridge Investments, LLC (subadviser)
Pioneer Small Cap Value Fund
Investment objective
Capital growth by investing in a diversified portfolio of securities consisting primarily of common stocks.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in equity securities of small companies. Small companies are those with market values, at the time of investment, that do not exceed the greater of the market capitalization of the largest company within the Russell 2000 Index or the 3-year rolling average of the market capitalization of the largest company within the Russell 2000 Index as measured at the end of the preceding month. The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The size of the companies in the index changes with market conditions and the composition of the index. Pioneer monitors the fund's portfolio so that, under normal circumstances, the capitalization range of the fund's portfolio is consistent with the inclusion of the fund in the Lipper Small-Cap category. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights, equity interests in real estate investment trusts (REITs) and preferred stocks.
Investment Adviser
Pioneer
Pioneer International Equity Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. The fund focuses on securities of issuers located in countries with developed markets (other than the United States) but may allocate up to 10% of its assets in countries with emerging economies or securities markets. Developed markets outside the United States generally include, but are not limited to, the countries included in the Morgan Stanley Capital International Europe, Australasia, Far East Index. The fund's assets must be allocated to securities of issuers located in at least three non-U.S. countries. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer International Value Fund
Investment objective
Long-term capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of non-U.S. issuers. These issuers may be located in both developed and emerging markets. Under normal circumstances, the fund's assets will be invested in securities of companies domiciled in at least three different foreign countries. Generally, the fund's investments in any country are limited to 25% or less of its total assets. However, the fund may invest more than 25% of its assets in issuers organized in Japan or the United Kingdom or in securities quoted or denominated in the Japanese yen, the British pound and the euro. Investment of a substantial portion of the fund's assets in such countries or currencies will subject the fund to the risks of adverse securities markets, exchange rates and social, political or economic events which may occur in those countries.
The fund may invest without limitation in securities of issuers located in countries with emerging economies or securities markets, but will not invest more than 25% of its total assets in securities of issuers located in any one such country.
For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred shares. The fund may also purchase and sell forward foreign currency exchange contracts in non-U.S. currencies in connection with its investments.
Investment Adviser
Pioneer
Pioneer Europe Select Fund
Investment objective
Capital growth.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of European issuers. The fund's principal focus is on European companies that exhibit strong growth characteristics and are considered to be leaders in their sector or industry. The fund generally focuses on mid- and large-capitalization European issuers. Equity securities include common stocks, convertible debt and other equity instruments, such as depositary receipts, warrants, rights and preferred stocks. The fund may also purchase and sell forward foreign currency exchange contracts in connection with its investments.
Investment Adviser
Pioneer
Pioneer Emerging Markets Fund
Investment objective
Long-term growth of capital.
Principal investment strategies
The fund invests primarily in securities of emerging market issuers. Although the fund invests in both equity and debt securities, it normally emphasizes equity securities in its portfolio. Normally, the fund invests at least 80% of its total assets in the securities of emerging market corporate and government issuers (i.e., securities of companies that are domiciled or primarily doing business in emerging countries and securities of these countries' governmental issuers).
Investment Adviser
Pioneer
Pioneer Real Estate Shares
Investment objective
Long-term growth of capital. Current income is a secondary objective.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in equity securities of real estate investment trusts (REITs) and other real estate industry issuers. For purposes of the fund's investment policies, equity securities include common stocks, convertible debt and other equity instruments, such as warrants, rights, interests in REITs and preferred stocks.
Investment Adviser
Pioneer (adviser); AEW Management and Advisors, L.P. (subadviser)
The underlying funds that invest primarily in debt securities are:
Pioneer Bond Fund
Investment objective
To provide current income from an investment grade portfolio with due regard to preservation of capital and prudent investment risk. The fund also seeks a relatively stable level of dividends; however, the level of dividends will be maintained only if consistent with preserving the investment grade quality of the fund's portfolio.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government or its agencies and instrumentalities,
o Debt securities, including convertible debt, of corporate and other issuers rated at least investment grade at the time of investment, and comparably rated commercial paper,
o Cash and cash equivalents, certificates of deposit, repurchase agreements maturing in one week or less and bankers' acceptances.
Normally, the fund invests at least 80% of its total assets in these securities. In addition, the fund may invest up to 20% of its total assets in debt securities rated below investment grade or, if unrated, of equivalent quality as determined by Pioneer. Cash and cash equivalents include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer High Yield Fund
Investment objective
Maximize total return through a combination of income and capital appreciation.
Principal investment strategies
Normally, the fund invests at least 80% of its total assets in below investment grade (high yield) debt securities and preferred stocks. These high yield securities may be convertible into the equity securities of the issuer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
Investment Adviser
Pioneer
Pioneer Short Term Income Fund
Investment objective
A high level of current income to the extent consistent with a relatively high level of stability of principal.
Principal investment strategies
The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities
o Debt securities, including convertible debt, of corporate and other issuers and commercial paper
o Mortgage-backed and asset-backed securities
o Short-term money market instruments
Normally, at least 80% of the fund's net assets are invested in debt securities that are rated investment grade at the time of purchase or cash and cash equivalents. Cash and cash equivalents may include cash balances, accrued interest and receivables for items such as the proceeds, not yet received, from the sale of the fund's portfolio investments.
Investment Adviser
Pioneer
Pioneer Cash Reserves Fund
Investment objective
High current income, preservation of capital and liquidity through investments in high-quality short-term securities.
Principal investment strategies
The fund seeks to maintain a constant net asset value of $1.00 per share by investing in high-quality, U.S. dollar denominated money market securities, including those issued by:
o U.S. and foreign banks
o U.S. and foreign corporate issuers
o The U.S. government and its agencies and instrumentalities
o Foreign governments
o Multinational organizations such as the World Bank
The fund may invest more than 25% of its total assets in U.S. government securities and obligations of U.S. banks. The fund may invest in any money market instrument that is a permissible investment for a money market fund under the rules of the Securities and Exchange Commission, including commercial paper, certificates of deposit, time deposits, bankers' acceptances, mortgage-backed and asset-backed securities, repurchase agreements, municipal obligations and other short-term debt securities.
Investment Adviser
Pioneer
Pioneer Strategic Income Fund
Investment objective
A high level of current income.
Principal investment strategies
Normally, the fund invests at least 80% of its net assets (plus the amount of borrowings, if any, for investment purposes) in debt securities. The fund has the flexibility to invest in a broad range of issuers and segments of the debt securities markets. Pioneer Investment Management, Inc., the fund's investment adviser, allocates the fund's investments among the following three segments of the debt markets:
o Below investment grade (high yield) securities of U.S. and non-U.S. issuers
o Investment grade securities of U.S. issuers
o Investment grade securities of non-U.S. issuers
Pioneer's allocations among these segments of the debt markets depend upon its outlook for economic, interest rate and political trends. The fund invests primarily in:
o Debt securities issued or guaranteed by the U.S. government, its agencies or instrumentalities or non-U.S. governmental entities
o Debt securities of U.S. and non-U.S. corporate issuers, including convertible debt
o Mortgage-backed and asset-backed securities
The fund's investments may have fixed or variable principal payments and all types of interest rate payment and reset terms, including fixed rate, adjustable rate, zero coupon, contingent, deferred, payment in kind and auction rate features. The fund invests in securities with a broad range of maturities.
Depending upon Pioneer's allocation among market segments, up to 70% of the fund's total assets may be in debt securities rated below investment grade at the time of purchase or determined to be of equivalent quality by Pioneer. Up to 20% of the fund's total assets may be invested in debt securities rated below CCC by Standard & Poor's Ratings Group or the equivalent by another nationally recognized statistical rating organization or determined to be of equivalent credit quality by Pioneer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher rated debt securities.
As with all fixed income securities, the market values of convertible debt securities tend to decline as interest rates increase and, conversely, to increase as interest rates decline. However, when the market price of the common stock underlying a convertible security exceeds the conversion price, the convertible security tends to reflect the market price of the underlying common stock.
Depending upon Pioneer's allocation among market segments, up to 85% of the fund's total assets may be in debt securities of non-U.S. corporate and governmental issuers, including debt securities of corporate and governmental issuers in emerging markets.
Investment Adviser
Pioneer
AmSouth High Quality Bond Fund and Pioneer Bond Fund
PROPOSAL 1(n)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests in a portfolio of investment grade fixed income securities and, consequently, the Funds have similar investment policies and risks. Pioneer Bond Fund may invest up to 20% of its net assets in below investment grade fixed income securities while your Fund only invests in investment grade securities. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth High Quality Bond Fund to Pioneer Bond Fund
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Delaware statutory
organized as a Massachusetts business trust. trust.
Net assets as of March 31, $628.6 million $270.3 million
2005
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Portfolio Manager:
Day to day management of the AmSouth High Day-to-day management of the Fund's portfolio
Quality Bond Fund's portfolio is the is the responsibility of Kenneth J. Taubes.
responsibility of John P. Boston, CFA. Mr. Mr. Taubes is responsible for overseeing the
Boston has served as the portfolio manager for U.S. and global fixed income teams. Mr. Taubes
the Fund since 1999. He also manages the joined Pioneer as a senior vice president in
AmSouth Government Income Fund and the AmSouth September 1998 and has been an investment
Limited Term Income Fund and co-manages the professional since 1982.
AmSouth Balanced Fund. He is Chief Fixed
Income Officer for AAMI. Mr. Boston began his
career in investment management with AmSouth
Bank in 1988 and has been associated with AAMI
since 1996.
Investment objective AmSouth High Quality Bond Fund seeks current Pioneer Bond Fund seeks current income from an
income consistent with the preservation of investment-grade portfolio with due regard to
capital. preservation of capital and prudent investment
risk. The Fund also seeks a relatively stable
level of dividends; however, the level of
dividends will be maintained only if
consistent with preserving the investment
grade quality of the Fund's portfolio.
Primary investments Under normal circumstances, the Fund will Under normal market conditions, Pioneer
invest at least 80% of its net assets in Bond Fund invests at least 80% of total
bonds.
|
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
For the purpose of this policy, net assets in:
assets include net assets plus borrowings for
investment purposes. AmSouth High Quality Bond o Debt securities issued or guaranteed by
Fund invests primarily in high quality bonds the U.S. government or its agencies and
and other fixed income securities. These instrumentalities
investments include primarily U.S. corporate o Debt securities, including convertible
bonds and debentures and notes or bonds issued debt, of corporate and other issuers
or guaranteed by the U.S. government, its rated at least investment grade at the
agencies or instrumentalities. The Fund time of investment, and comparably rated
invests in securities issued by GNMA, which commercial paper
are supported by the full faith and credit of o Cash and cash equivalents, certificates of
the U.S. government, and securities issued by deposit, repurchase agreements maturing in
FNMA, FHLMC and FHLBs, which are supported by one week or less and bankers' acceptances
the right of the issuer to borrow from the
U.S. Treasury. The Fund also invests in debt
securities only if they are high-grade (rated
at time of purchase in one of the four highest
rating categories by a national recognized
statistical rating organization, or are
determined by AAMI to be of comparable
quality). In addition, the Fund also invests
in zero-coupon obligations which are
securities which do not provide current income
but represent ownership of future interest and
principal payments on U.S. Treasury bonds.
AmSouth High Quality Bond Fund may purchase
fixed income securities of any maturity and
there is no limit on the Fund's average
maturity. AmSouth High Quality Bond Fund's
fixed income strategy focuses on managing the
Fund's portfolio to produce a total return
that will exceed the Lehman Brothers
Government/Credit Index while maintaining a
risk profile similar to that of the Index.
Investment strategies AAMI's fixed income portfolio management Pioneer considers both broad economic and
process focuses on the four key areas of issuer specific factors in selecting a
duration management, sector weights, position portfolio designed to achieve the Fund's
on the yield curve and security selection; investment objective. In assessing the
AAMI's goal is to add value in each of these appropriate maturity, rating and sector
four areas through the active management of weighting of the Fund's portfolio, Pioneer
AmSouth High Quality Bond Fund's portfolio. considers a variety of factors that are
Beginning with rigorous fundamental analysis expected to influence economic activity and
of the economy and taking into account interest rates. These factors include
characteristics of the current business and fundamental economic indicators, such as the
interest rate cycles, AAMI arrives at a rates of economic growth and inflation,
projection of the likely trend in interest Federal Reserve monetary policy and the
rates and adjusts duration accordingly. relative value of the U.S. dollar compared to
Analysis of the shape of the yield curve and other currencies. Once Pioneer determines the
yield spreads among bond market sectors leads preferable portfolio characteristics, it
to further refinements in strategy. Using selects individual securities based upon the
securities selected from the U.S. Treasury, terms of the securities (such as yields
Federal compared to U.S.
|
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
Agency, mortgage backed and investment Treasuries or comparable issuers), liquidity
grade credit sectors, AmSouth High Quality and rating, sector and issuer diversification.
Bond Fund's portfolio is constructed and
managed to produce returns that exceed the
Fund's benchmark index over a full market
cycle.
Other investments The Fund may hold up to 20% of its assets in Pioneer Bond Fund may invest up to 20% of its
cash and cash equivalents. "Cash equivalents" total assets in debt securities rated below
are short-term, interest-bearing instruments investment grade or, if unrated, of equivalent
or deposits known as money market instruments. quality as determined by Pioneer.
Pioneer Bond Fund may invest up to 15% of its
total assets in equity and debt securities of
non-U.S. corporate issuers and in debt
securities of non-U.S. government issuers.
Pioneer Bond Fund will not invest more than 5%
of its total assets in the securities of
emerging markets issuers.
Pioneer Bond Fund may invest a substantial
portion of its assets in mortgage-related
securities, which represent interests in pools
of mortgage loans assembled for sale to
investors by various U.S. governmental
agencies, government-related organizations and
private issuers. These investments may include
mortgage-related derivative securities such as
collateralized mortgage obligations.
Pioneer Bond Fund may invest in securities of
Canadian issuers to the same extent as
securities of U.S. issuers.
Temporary defensive When AAMI determines adverse market conditions Pioneer Bond Fund may invest all or part of
strategies exist, AmSouth High Quality Bond Fund may its assets in securities with remaining
invest entirely in cash positions, directly in maturities of less than one year, cash
U.S. Government securities and short-term equivalents or may hold cash.
paper, such as bankers' acceptances.
Diversification Each Fund is diversified for the purpose of the Investment Company Act and is subject to
diversification requirements under the Internal Revenue Code of 1986, as amended (the "Code").
Industry concentration AmSouth High Quality Bond Fund may not Pioneer Bond Fund may not invest more than 25%
purchase any securities which would cause more of its assets in any one industry.
than 25% of the value of the Fund's total
assets at the time of purchase to be invested
in securities of one or more issuers
conducting their principal business activities
in the same industry, provided that (a) there
is no limitation with respect to obligations
issued or guaranteed by the U.S. government or
its agencies or instrumentalities, and
repurchase agreements
|
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
secured by obligations of the U.S. government
or its agencies or instrumentalities; (b)
wholly owned finance companies will be
considered to be in the industries of their
parents if their activities are primarily
related to financing the activities of their
parents; and (c) utilities will be divided
according to their services. For example,
gas, gas transmission, electric and gas,
electric, and telephone will each be
considered a separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental user.
Restricted and illiquid AmSouth High Quality Bond Fund may not invest Pioneer Bond Fund may not invest more than 15%
securities more than 15% of its net assets in securities of its net assets in securities that are
that are restricted as to resale, or for which illiquid and other securities that are not
no readily available market exists, including readily marketable. Repurchase agreements
repurchase agreements providing for settlement maturing in more than seven days will be
more than seven days after notice. included for purposes of the foregoing limit.
Borrowing AmSouth High Quality Bond Fund may not borrow Pioneer Bond Fund may not borrow money, except
money or issue senior securities, except that the Fund may: (a) borrow from banks or through
the Fund may borrow from banks or enter into reverse repurchase agreements in an amount up
reverse repurchase agreements for temporary to 33 1/3% of the Fund's total assets
emergency purposes in amounts up to 33 1/3% of (including the amount borrowed); (b) to the
the value of its total assets at the time of extent permitted by applicable law, borrow up
such borrowing. The Fund will not purchase to an additional 5% of the Fund's assets for
securities while borrowings (including reverse temporary purposes; (c) obtain such short-term
repurchase agreements) in excess of 5% of its credits as are necessary for the clearance of
total assets are outstanding. In addition, the portfolio transactions; (d) purchase
Fund is permitted to participate in a credit securities on margin to the extent permitted
facility whereby the Fund may directly lend to by applicable law; and (e) engage in
and borrow money from other AmSouth funds for transactions in mortgage dollar rolls that are
temporary purposes, provided that the loans accounted for as financings.
are made in accordance with an order of
exemption from the SEC and any conditions
thereto.
Lending AmSouth High Quality Bond Fund may not make Pioneer Bond Fund may not make loans, except
loans, except that the Fund may purchase or by the purchase of debt obligations, by
hold debt instruments in accordance with its entering into repurchase agreements
investment objective and policies, lend Fund or through the lending of portfolio securities.
securities in accordance with its investment
objective and policies and enter into
repurchase agreements. In addition, the Fund
is permitted to participate in a credit
facility whereby the Fund may directly lend
to and borrow money from other AmSouth funds
for temporary purposes, provided that the
loans are made in accordance with an order of
exemption from
|
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
the SEC and any conditions thereto.
Derivative instruments AmSouth High Quality Bond Fund may invest in Pioneer Bond Fund may use futures and options
futures contracts and options thereon on securities, indices and currencies, forward
(interest rate futures contracts or index currency exchange contracts and other
futures contracts, as applicable) to commit derivatives. The Fund does not use derivatives
funds awaiting investment, to maintain cash as a primary investment technique and
liquidity or for other hedging purposes. The generally limits their use to hedging.
value of the Fund's contracts may equal or However, the Fund may use derivatives for a
exceed 100% of the Fund's total assets, variety of non-principal purposes, including:
although the Fund will not purchase or sell a o As a hedge against adverse changes in
futures contract unless immediately afterwards stock market prices, interest rates or
the aggregate amount of margin deposits on its currency exchange rates
existing futures positions plus the amount of o As a substitute for purchasing or
premiums paid for related futures options selling securities
entered into for other than bona fide hedging o To increase the Fund's return as a
purposes is 5% or less of its net assets. non-hedging strategy that may be
considered speculative
Short-term trading Neither Fund usually trades for short-term profits. A Fund will sell an investment, however,
even if it has only been held for a short time, if it no longer meets the Fund's investment
criteria.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 4.00% of the offering sales charge of up to 4.50% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 4% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge is
(non 12b-1) of up to 0.25% of average daily waived.
net assets.
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to contingent
to 5%. For Class B shares purchased prior to deferred sales charges of up to 4% if you sell
the combination of AmSouth Funds with ISG your shares. The charge is reduced over time
Funds, the CDSC on such Class B shares held and is not charged after five years. Your
continuously declines over six years, starting investment firm may receive a commission
|
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
with year one and ending in year seven from: from PFD, the Fund's distributor, at the time
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B of your purchase of up to 4%.
shares held continuously, the CDSC declines
over six years, starting with year one and Class B shares are subject to distribution and
ending in year seven from: 5%, 4%, 3%, 3%, service (12b-1) fees of up to 1% of average
2%, 1%. Eight years after purchase (seven daily net assets.
years in the case of shares acquired in the
ISG combination), Class B shares Class B shares acquired through the
automatically convert to Class A shares. Reorganization will be subject to the CDSC and
commission schedules applicable to the
Class B shares pay a shareholder servicing fee original purchase.
(non 12b-1) of 0.25% of average daily net
assets and a distribution (12b-1) fee of 0.75% Maximum purchase of Class B shares in a single
of average daily net assets. transaction is $49,999.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y sales AmSouth High Quality Bond Fund does not impose The Fund does not impose any initial,
charges and Rule 12b-1 any initial or CDSC on Class I shares. contingent deferred or asset based sales
fees charge on Class Y shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average distributing the Fund's Class Y shares, none
daily net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth High Quality Bond Fund pays an Pioneer Bond Fund pays Pioneer an annual fee
advisory fee on a monthly basis at an annual equal to 0.50% of the Fund's average daily net
rate of 0.50% of the Fund's average daily net assets.
assets.
In addition, the Fund reimburses Pioneer for
ASO Services Company, Inc. ("ASO") serves as certain fund accounting and legal expenses
administrator and fund accounting agent for incurred on behalf of the Fund and pays a
the Fund. The Fund pays ASO an administrative separate shareholder servicing/transfer agency
services fee of 0.15% of the Fund's average fee to PIMSS, an affiliate of Pioneer.
daily net assets.
Pioneer has contractually agreed to limit
Other expenses of the Fund are being limited ordinary operating expenses to the extent
to 0.48% for Class A shares, 0.49% for Class B required to reduce fund expenses to 1.00%
shares and 0.33% for Class I shares. Any fee attributable to Class A shares and 1.90%
waiver or expense reimbursement arrangement is attributable to Class B shares. This expense
voluntary and may be discontinued at any time. limitation is in effect through November 1,
2007 for Class A shares and November 1, 2006
For the fiscal year ended July 31, 2004, the for Class B shares.
Fund's annual operating expenses for Class A
shares, after giving effect to the expense For the fiscal year ended June 30, 2004, the
limitation were 0.98%, and without giving Fund's total annual operating expenses for
effect to the expense limitation, were 1.00% Class A shares, after giving effect to the
of average daily net assets. expense limitation, were 1.00%, and without
giving effect to the expense limitation were
For the fiscal year ended July 31, 2004, the 1.15% of average daily net assets.
|
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
Fund's annual operating expenses for Class B For the fiscal year ended June 30, 2004, the
shares, after giving effect to the expense Fund's total annual operating expenses for
limitation were 1.74%, and without giving Class B shares were 1.98% of average daily net
effect to the expense limitation, were 1.76% assets.
of average daily net assets.
For the fiscal year ended June 30, 2004, the
For the fiscal year ended July 31, 2004, the Fund's total annual operating expenses for
Fund's annual operating expenses for Class I Class Y shares were 0.58% of average daily net
shares, after giving effect to the expense assets.
limitation were 0.83%, and without giving
effect to the expense limitation, were 0.90%
of average daily net assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Pioneer Fund
by telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. The Fund allows you to exchange your
requirements for the Fund into which you are shares at net asset value without charging you
exchanging. Exchanges from one fund to another either an initial or contingent deferred
are taxable. Class A shares may be exchanged shares charge at the time of the exchange.
for Class I shares of the same Fund or another Shares you acquire as part of an exchange will
AmSouth Fund if you become eligible to continue to be subject to any contingent
purchase Class I shares. Class I shares may be deferred sales charge that applies to the
exchanged for Class A shares of the same fund. shares you originally purchased. When you
No transaction fees are currently charged for ultimately sell your shares, the date of your
exchanges. original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth fund within 7 days purchase of shares for federal income tax
of the date of purchase, you will be charged a purposes.
2.00% fee on the current net asset value of
the shares sold or exchanged. The fee is paid After you establish an eligible fund account,
to the Fund to offset the costs associated you can exchange Fund shares by telephone or
with short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares purchased
first will be considered redeemed first for
purposes of determining whether the redemption
fee will be charged.
|
AmSouth High Quality Bond Fund Pioneer Bond Fund
----------------------------------------------------------------------------------------------------------------------------
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator
or brokerage firm to implement the fee). The
Fund will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o The issuer of a security owned by the Fund defaults on its obligation to pay principal and/or interest or has its credit rating downgraded
o During periods of declining interest rates, the issuer of a security may exercise its option to prepay principal earlier than scheduled, forcing the Fund to reinvest in lower yielding securities. This is known as call or prepayment risk
o During periods of rising interest rates, the average life of certain types of securities may be extended because of slower than expected principal payments. This may lock in a below market interest rate, increase the security's duration (the estimated period until the security is paid in full) and reduce the value of the security. This is known as extension risk
o The adviser's judgment about the attractiveness, relative value or potential appreciation of a particular sector, security or investment strategy proves to be incorrect
o To the extent that the Fund invests significantly in high yield securities, its exposure to the credit risks associated with such securities may be greater, its income and net asset value may be more volatile and it may be more difficult to achieve preservation of principal
Government sponsored entities such as the Federal Home Loan Mortgage Corporation (Freddie Mac), the Federal National Mortgage Association (FNMA) and the Federal Home Loan Banks (FHLBs), although chartered or sponsored by Congress, are not funded by congressional appropriations and the debt and mortgage-backed securities issued by them are neither guaranteed nor issued by the U.S. government.
To the extent a Fund invest significantly in mortgage-backed securities, its exposure to prepayment and extension risks may be greater than if it invested in other fixed income securities.
At times, more than 25% of Pioneer Bond Fund's assets may be invested in the same market segment, such as financials. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus. For example, industries in the financial segment, such as banks, insurance companies, broker-dealers and REITs, may be sensitive to changes in interest rates and general economic activity and are subject to extensive government regulation.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The table shows average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth High Quality Bond Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 18.41 1996 2.56 1997 9.27 1998 9.19 1999 -2.56 2000 12.06 2001 7.40 2002 10.66 2003 2.63 2004 2.65 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 6.53% for the quarter ended June 30, 1995, and the lowest quarterly return was -2.61% for the quarter ended June 30, 2004.
Pioneer Bond Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 18.16 1996 1.96 1997 9.16 1998 7.69 1999 -3.20 2000 8.45 2001 7.54 2002 8.77 2003 8.85 2004 5.71 |
* During the period shown in the bar chart, Pioneer Bond Fund's highest quarterly return was 6.11% for the quarter ended June 30, 1995, and the lowest quarterly return was -2.63% for the quarter ended March 31, 1996.
AmSouth High Quality Bond Fund Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
-----------------------------------------------------------------------------------------
AmSouth High Quality Bond Fund, Class A Shares
-----------------------------------------------------------------------------------------
Return Before Taxes(1) -1.45% 6.14% 6.64%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions -2.95% 4.13% 4.32%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -0.95% 4.05% 4.26%
-----------------------------------------------------------------------------------------
AmSouth High Quality Bond Fund, Class B Shares
-----------------------------------------------------------------------------------------
Return Before Taxes -3.00% 5.90% 6.25%
-----------------------------------------------------------------------------------------
AmSouth High Quality Bond Fund, Class I Shares(2)
-----------------------------------------------------------------------------------------
Return Before Taxes 2.80% 7.16% 7.18%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions 1.18% 5.08% 4.81%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 1.81% 4.90% 4.71%
-----------------------------------------------------------------------------------------
Merrill Lynch Government Credit Index(3) 4.15% 7.95% 7.78%
Lehman Brothers Government/Credit Bond Index(4) 4.18% 8.00% 7.80%
Merrill Lynch Government Credit A-Rated Index(5) 3.72% 7.75% 7.65%
(reflects no deduction for fees, expenses or taxes)
-----------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 12/1/88. Performance for the Class B shares, which were first offered on 9/16/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the contingent deferred sales charge.
(2) Performance for the Class I shares, which were first offered on 9/2/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date.
(3) The Merrill Lynch Government Credit Index and the Merrill Lynch Government Credit A-Rated Index, unmanaged indices representative of the total return of government and corporate bonds, are for reference only, do not mirror the Fund's investments, and reflect no deduction for fees, expenses or taxes.
(4) The Fund has changed its benchmark from the Lehman Brothers Government/Credit Bond Index to the Merrill Lynch Government Credit Index to provide a more appropriate market comparison for the Fund's performance.
(5) The Fund has added information regarding the Merrill Lynch Government Credit A-Rated Index to provide an additional index for comparison of the Fund's performance.
The table above shows the impact of taxes on AmSouth High Quality Bond Fund's returns. After-tax returns are only shown for Class A shares and Class I shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Bond Fund Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
--------------------------------------------------------------------------------------------
Pioneer Bond Fund, Class A shares
--------------------------------------------------------------------------------------------
Return Before Taxes 0.95% 6.86% 6.69%
--------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) -0.84% 4.54% 4.16%
--------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares(1) 0.59% 4.42% 4.11%
--------------------------------------------------------------------------------------------
Pioneer Bond Fund, Class B shares
--------------------------------------------------------------------------------------------
Return Before Taxes 0.82% 6.93% 6.30%
--------------------------------------------------------------------------------------------
Pioneer Bond Fund, Class Y shares
--------------------------------------------------------------------------------------------
Return Before Taxes 6.35% 8.18% 7.34%
--------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) 4.28% 5.68% 4.71%
--------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares(1) 4.09% 5.45% 4.63%
--------------------------------------------------------------------------------------------
Lehman Brothers Aggregate Bond Index(2) 4.34% 7.71% 7.72%
(reflects no deduction for fees, expenses or taxes)
--------------------------------------------------------------------------------------------
|
(1) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown. Furthermore, the after-tax returns shown are not relevant to those who hold their shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
(2) The Lehman Brothers Aggregate Bond Index, an unmanaged index of government, mortgage and asset backed securities, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth High Quality Bond Fund, the expenses of AmSouth High Quality Bond Fund for the period ended January 31, 2005, and (ii) for Pioneer Bond Fund, the expenses of Pioneer Bond Fund for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004.
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Combined AmSouth Pioneer Combined
transaction fees (paid High Bond Fund High Bond Fund (Pro High Bond Fund (Pro
directly from your Quality Fund (Pro Forma) Quality Fund Forma) Quality Fund Forma)
investment) Bond Bond Bond
Fund(1) Fund(1) Fund(1)
-------------------------------------------------------------------------------------------------------------------------------
Class A Class A Class A Class B Class B Class B Class I Class Y Class Y
-------------------------------------------------------------------------------------------------------------------------------
Maximum sales charge 4.00%(2) 4.50% 4.50% None None None None None None
(load) when you buy
shares as a percentage
of offering price
-------------------------------------------------------------------------------------------------------------------------------
Maximum deferred sales None(2) None(2) None(2) 5.00%(3) 4.00% 4.00% None None None
charge (load) as a
percentage of purchase
price or the amount
you receive when you
sell shares, whichever
is less
-------------------------------------------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) None None 2.00%(4) None None 2.00%(4) None None
-------------------------------------------------------------------------------------------------------------------------------
Annual fund operating
expenses (deducted
from fund assets) (as
a % of average net
assets)
-------------------------------------------------------------------------------------------------------------------------------
Management fee 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50%
-------------------------------------------------------------------------------------------------------------------------------
Distribution and None 0.25% 0.25% 0.75% 1.00% 1.00% None None None
service (12b-1) fee
-------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.66%(5) 0.30% 0.30% 0.79%(5) 0.45% 0.46% 0.56%(5) 0.06% 0.06%
-------------------------------------------------------------------------------------------------------------------------------
Total fund operating 1.16% 1.05%(6) 1.05% 2.04% 1.95%(6) 1.95% 1.06% 0.56%(6) 0.56%
expenses
-------------------------------------------------------------------------------------------------------------------------------
Expense 0.17% 0.05%(7) 0.05% 0.29% N/A 0.05%(8) 0.21% N/A N/A
reimbursement/reduction
-------------------------------------------------------------------------------------------------------------------------------
Net fund operating 0.99% 1.00% 1.00% 1.75% 1.95% 1.90% 0.85% 0.56% 0.56%
expenses
-------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.49% for Class A shares, 0.50% for Class B shares and 0.35% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(7) The expenses in the table above reflect the expense limitation in effect through November 1, 2007, under which Pioneer has contractually agreed to limit ordinary operating expenses to the extent required to reduce Class A expenses to 1.00% of the average daily net assets attributable to Class A shares. There can be no assurance that Pioneer will extend the expense limitation beyond November 1, 2007.
(8) The expenses in the table above reflect the expense limitation in effect through November 1, 2006, under which Pioneer has contractually agreed to limit ordinary operating expenses to the extent required to reduce Class B expenses to 1.90% of the average daily net assets attributable to Class B shares. There can be no assurance that Pioneer will extend the expense limitation beyond November 1, 2006.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, (d) each Fund's gross operating expenses remain the same, and (e) the expense limitation for your Fund is in effect for year one. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Number of years you AmSouth High Quality Bond Combined Fund
own your shares Fund Pioneer Bond Fund (Pro Forma)
---------------------------------------------------------------------------------------------------------------
Class A
---------------------------------------------------------------------------------------------------------------
Year 1 $ 513 $ 671 $ 671
---------------------------------------------------------------------------------------------------------------
Year 3 $ 754 $ 880 $ 880
---------------------------------------------------------------------------------------------------------------
Year 5 $1,013 $1,112 $1,112
---------------------------------------------------------------------------------------------------------------
Year 10 $1,753 $1,775 $1,775
---------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
---------------------------------------------------------------------------------------------------------------
Year 1 $ 707 $ 593 $ 593
---------------------------------------------------------------------------------------------------------------
Year 3 $ 940 $ 902 $ 907
---------------------------------------------------------------------------------------------------------------
Year 5 $1,298 $1,143 $1,148
---------------------------------------------------------------------------------------------------------------
Year 10 $2,143 $2,033 $2,037
---------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
---------------------------------------------------------------------------------------------------------------
Year 1 $ 207 $ 193 $ 193
---------------------------------------------------------------------------------------------------------------
Year 3 $ 640 $ 602 $ 607
---------------------------------------------------------------------------------------------------------------
Year 5 $1,098 $1,043 $1,048
---------------------------------------------------------------------------------------------------------------
Year 10 $2,143 $2,033 $2,037
---------------------------------------------------------------------------------------------------------------
Class I Class Y
---------------------------------------------------------------------------------------------------------------
Year 1 $ 108 $ 57 $ 57
---------------------------------------------------------------------------------------------------------------
Year 3 $ 337 $ 179 $ 179
---------------------------------------------------------------------------------------------------------------
Year 5 $ 585 $ 313 $ 313
---------------------------------------------------------------------------------------------------------------
Year 10 $1,294 $ 701 $ 701
---------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of Amsouth High Quality Bond Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the historical investment performance of Pioneer Bond Fund is comparable to your AmSouth Fund's investment performance. For the one, five and ten year periods ended December 31, 2004, Class A shares of Pioneer Bond Fund had an average annual return of 0.95% (one year); 6.86% (five year); and 6.69% (ten year), compared to an average annual return of the Class A shares of your AmSouth Fund of -1.45% (one year); 6.14% (five year); and 7.64% (ten year), respectively, during the same period. The Trustees also noted that, for the one and five year periods ended March 31, 2005, Class A shares of Pioneer Bond Fund had an average annual return of 2.67% (one year); and 7.60% (five year), compared to an average annual return of the Class A shares of your AmSouth Fund of -0.25% (one year); and 6.25% (five year), during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Third, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $15.7 billion in fixed income searches. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of
UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fourth, the aggregate management and administration fees incurred by your AmSouth Fund are higher than the management fee paid by Pioneer Bond Fund. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. With respect to Class I shares, both the gross and net expenses of the Pioneer Fund are lower than your AmSouth Fund. While the pro forma expenses are estimated to be lower for your Class A and B Shares on a gross basis, the expenses will be higher on a net basis. The lower net expenses of your AmSouth Fund are a result of voluntary expense limitations that may be discontinued at any time. The trustees considered the positive factors associated with the Reorganization, such as greater fund assets and potential for growth, to outweigh the negative factors, such as the increase in expenses.
Fifth, the Class A, B and Y shares of Pioneer Bond Fund received in the Reorganization will provide AmSouth High Quality Bond Fund shareholders with exposure to substantially the same investment product as they currently have.
Sixth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of your Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
Pro Forma
AmSouth High Pioneer Bond Pioneer Bond
Quality Bond Fund Fund Fund
May 31, 2005 May 31, 2005 May 31, 2005
-------------------------------------------------------------------------------------
Total Net Assets (in thousands) ... $ 622,574 $ 297,638 $ 920,212
Class A shares ................. $ 53,254 $ 173,605 $ 226,859
Class B shares ................. $ 6,222 $ 57,319 $ 63,542
Class I/Y shares ............... $ 563,098 $ 18,481 $ 581,579
Net Asset Value Per Share
Class A shares ................. $ 11.16 $ 9.37 $ 9.37
Class B shares ................. $ 11.13 $ 9.33 $ 9.33
Class I/Y shares ............... $ 11.16 $ 9.30 $ 9.30
Shares Outstanding
Class A shares ................. 4,771,272 18,533,637 24,218,924
Class B shares ................. 559,225 6,147,733 6,813,993
Class I/Y shares ............... 50,444,625 1,986,416 62,510,903
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Florida Tax-Exempt Fund and Pioneer Florida Tax Free Income Fund
PROPOSAL 1(o)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-2, because it contains details that are not in the summary.
Each Fund seeks to produce as high a level of current interest income exempt from federal income tax and Florida intangible personal property tax as is consistent with the preservation of capital. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Florida Tax-Exempt Fund to Pioneer Florida Tax Free Income Fund
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
--------------------------------------------------------------------------------------------------------------------------------
Business A non-diversified series of AmSouth Funds, an A newly created, non-diversified series of Pioneer
open-end management investment company Series Trust IV, an open-end management investment
organized as a Massachusetts business trust. company organized as a Delaware statutory trust.
Net assets as of March 31, $55.3 million None. Pioneer Florida Tax Free Income Fund is
2005 newly created and does not expect to commence
investment operations until the Reorganization
occurs.
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Portfolio Manager:
Day-to-day management of AmSouth Florida Day-to-day management of the fund's portfolio
Tax-Exempt Fund's portfolio is the is the responsibility of David Eurkus. Mr.
responsibility of Dorothy E. Thomas, CFA. Ms. Eurkus joined Pioneer as a senior vice
Thomas has more than 20 years of experience as president in January 2000 and has been an
an investment portfolio manager. She has been investment professional since 1969. From 1998
associated with AmSouth's Trust Investment to 2000, Mr. Eurkus was a senior vice
Group since 1982 and is currently Senior Vice president of fixed income investing for the
President and Trust Investment Officer in Private Client Group at Brown Brothers
charge of tax-free fixed income investments. Harriman. Prior to that he was a senior vice
president at Putnam Investments.
Investment objective AmSouth Florida Tax-Exempt Fund seeks to Pioneer Florida Tax Free Income Fund seeks to
produce as high a level of current interest produce as high a level of current interest
income exempt from federal income tax and income exempt from federal income tax and
Florida intangible personal property tax as Florida state intangible personal property
is consistent with the preservation of tax as is consistent with the relative
capital. stability of capital.
Primary investments Normally, AmSouth Florida Tax-Exempt Fund will Normally, the Fund invests at least 80% of its
invest at least 80% of its net assets in net assets (plus the amount of borrowings, if
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
municipal securities issued by or on behalf of any, for investment purposes) in securities
the State of Florida and its political the interest on which is exempt from regular
subdivisions, the interest on which, in the federal income tax and Florida intangible
opinion of the issuer's bond counsel at the personal property tax. Florida does not impose
time of issuance, is exempt from federal and an individual income tax. The Fund may invest
state income tax, if any, is not subject to in securities the interest on which is a tax
the federal alternative minimum tax, and is preference item for purposes of the federal
exempt from the Florida intangible personal alternative minimum tax.
property tax. For purposes of this policy, net
assets include net assets plus borrowings. The The Fund's investments may have fixed or
Fund invests in Florida municipal securities variable principal payments and all types of
only if they are high-grade (rated at the time interest rate payment and reset terms,
of purchase in one of the four highest rating including fixed and floating rates, inverse
categories by a national recognized floating rate, zero coupon, contingent,
statistical rating organization ("NRSRO") or deferred and payment in kind and auction rate
determined by AAMI to be of comparable features.
quality). The Fund will have a dollar-weighted
average maturity of five to ten years. The Fund may invest in municipal securities
of any maturity. Municipal securities with
longer maturities are generally more volatile
than other fixed income securities with
shorter maturities.
Investment strategies AAMI's fixed income portfolio management Pioneer considers both broad economic factors
process focuses on the four key areas of and issuer specific factors in selecting a
duration management, sector weights, position portfolio designed to achieve the Fund's
on the yield curve and security selection; investment objective. In assessing the
AAMI's goal is to add value in each of these appropriate maturity and rating weighting of
four areas through the active management of the Fund's portfolio, Pioneer considers a
the Fund's portfolio. Beginning with rigorous variety of factors that are expected to
fundamental analysis of the economy and taking influence economic activity and interest
into account characteristics of the current rates. These factors include fundamental
business and interest rate cycles, AAMI economic indicators, such as the rates of
arrives at a projection of the likely trend in economic growth and inflation, Federal Reserve
interest rates and adjusts duration monetary policy and the relative value of the
accordingly. Analysis of the shape of the U.S. dollar compared to other currencies. Once
yield curve and yield spreads among bond Pioneer determines the preferable portfolio
market sectors leads to further refinements in characteristics, Pioneer selects individual
strategy. securities based upon the terms of the
securities (such as yields compared to U.S.
Treasuries or comparable issues), liquidity
and rating and issuer diversification.
Pioneer also employs due diligence and
fundamental research, an evaluation of the
issuer based on its financial statements and
operations, to assess an issuer's credit
quality, taking into account financial
condition, future capital needs and potential
for change in rating. In making these
portfolio decisions, Pioneer relies on the
knowledge, experience and judgment of its
staff who have access to a wide variety of
research.
Other investments Under normal circumstances, the Fund may Pioneer Florida Tax Free Income Fund invests
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
invest up to 20% of its assets in taxable primarily in investment grade securities that
obligations. For purposes of the 20% basket, provide income that is exempt from federal
the Fund may also invest in municipal income tax and Florida intangible personal
securities of states other than Florida. property tax but may invest up to 10% of its
net assets in debt securities rated below
investment grade.
A debt security is considered investment
grade if it is:
o Rated BBB or higher at the time of
purchase by Standard & Poor's Ratings
Group;
o Rated the equivalent rating by a NRSRO;
or
o Determined to be of equivalent credit
quality by Pioneer
The Fund may invest in tax-exempt securities
of issuers located outside the state of
Florida.
The Fund may invest up to 20% of its net
assets in securities of other investment
companies, investment grade commercial paper,
U.S. government securities, U.S. or foreign
bank instruments and repurchase agreements.
The Fund may invest up to 10% of its net
assets in inverse floating rate obligations
(a type of derivative instrument). Inverse
floating rate obligations represent interests
in tax-exempt bonds. The interest rate on
inverse floating rate obligations will
generally decrease as short-term interest
rates increase, and increase as short-term
rates decrease. Due to their leveraged
structure, the sensitivity of the market
value of an inverse floating rate obligation
to changes in interest rates is generally
greater than a comparable long-term bond
issued by the same municipality and with
similar credit quality, redemption and
maturity provisions. Inverse floating rate
obligations may be volatile and involve
leverage risk.
Temporary defensive For temporary defensive purposes, the Fund may Normally, the Fund invests substantially all
strategies increase its holdings in taxable obligations of its assets to meet its investment
to over 20% of its assets and hold uninvested objective. The Fund may invest the remainder
cash reserves pending investment. The Fund may of its assets in securities with remaining
also increase its holdings in municipal maturities of less than one year, cash
securities of states other than Florida to equivalents or may hold cash. For temporary
over 20% of its assets in such situations. defensive purposes, including during periods
Taxable obligations may include obligations of unusual cash flows, the Fund may depart
issued or guaranteed by the U.S. government, from its principal investment strategies and
its agencies or instrumentalities (some of invest part or all of its assets in these
which securities or may hold cash.
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
may be subject to repurchase agreements), During such periods, the Fund may not be able
certificates of deposit, demand and time to achieve its investment objective. The Fund
deposits, bankers' acceptances of selected intends to adopt a defensive strategy when
banks, and commercial paper meeting the Fund's Pioneer believes securities in which the Fund
quality for tax-exempt commercial paper. normally invests have extraordinary risks due
to political or economic factors and in other
extraordinary circumstances.
Diversification Each Fund is non-diversified for the purpose of the Investment Company Act
and, therefore, may concentrate its investments in a limited number of
issuers.
Industry concentration AmSouth Florida Tax-Exempt Fund may not Pioneer Florida Tax Free Income Fund
purchase any securities which would may not invest more than 25% of its
cause more than 25% of the value of the assets in any one industry.
Fund's total assets at the time of
purchase to be invested in securities
of one or more issuers conducting their
principal business activities in the
same industry, provided that (a) there
is no limitation with respect to
obligations issued or guaranteed by the
U.S. government or its agencies or
instrumentalities, and repurchase
agreements secured by obligations of
the U.S. government or its agencies or
instrumentalities; (b) wholly owned
finance companies will be considered to
be in the industries of their parents
if their activities are primarily
related to financing the activities of
their parents; and (c) utilities will
be divided according to their services.
For example, gas, gas transmission,
electric and gas, electric, and
telephone will each be considered a
separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental
user.
Restricted and illiquid AmSouth Florida Tax-Exempt Fund may not Pioneer Florida Tax Free Income Fund may not
securities invest more than 15% of its net assets in invest more than 15% of its net assets in
securities that are restricted as to resale, securities that are illiquid and other
or for which no readily available market securities that are not readily marketable.
exists, including repurchase agreements Repurchase agreements maturing in more than
providing for settlement more than seven seven days will be included for purposes of
days after notice. the foregoing limit.
Borrowing AmSouth Florida Tax-Exempt Fund may not borrow Pioneer Florida Tax Free Income Fund may not
money or issue senior securities, except that borrow money, except the Fund may: (a) borrow
the Fund may borrow from banks or enter into from banks or through reverse repurchase
reverse repurchase agreements for temporary agreements in an amount up to 33 1/3% of the
emergency purposes in amounts up to 10% of the Fund's total assets (including the amount
value of its total assets at the time of such borrowed); (b) to the extent permitted by
borrowing. The Fund will not purchase applicable law, borrow up to an additional 5%
securities while borrowings (including reverse of the Fund's assets for temporary purposes;
repurchase agreements) in excess of 5% of its (c) obtain such short-term credits as are
total assets are outstanding. necessary for the clearance of portfolio
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
excess of 5% of its total assets are transactions; (d) purchase securities on
outstanding. margin to the extent permitted by applicable
law; and (e) engage in transactions in
mortgage dollar rolls that are accounted for
as financings.
Lending AmSouth Florida Tax-Exempt Fund may not make Pioneer Florida Tax Free Income Fund may lend
loans, except that the Fund may purchase or portfolio securities with a value that may not
hold debt instruments in accordance with its exceed 33 1/3% of the value of its assets.
investment objective and policies, may lend
Fund securities in accordance with its
investment objective and policies, and may
enter into repurchase agreements.
Derivative instruments AmSouth Florida Tax-Exempt Fund may invest in Pioneer Florida Tax Free Income Fund may use
futures contracts and options thereon futures and options on securities, indices and
(interest rate futures contracts or index other derivatives. A derivative is a security
futures contracts, as applicable) to commit or instrument whose value is determined by
funds awaiting investment, to maintain cash reference to the value or the change in value
liquidity or for other hedging purposes. The of one or more securities, indices or other
value of the Fund's contracts may equal or financial instruments. Although there is no
exceed 100% of the Fund's total assets, specific limitation on investing in
although the Fund will not purchase or sell a derivatives, the Fund does not use derivatives
futures contract unless immediately afterwards as a primary investment technique and
the aggregate amount of margin deposits on its generally limits their use to hedging.
existing futures positions plus the amount of However, the Fund may use derivatives for a
premiums paid for related futures options variety of non-principal purposes, including:
entered into for other than bona fide hedging
purposes is 5% or less of its net assets. o As a hedge against adverse changes in
interest rates
o As a substitute for purchasing or selling
securities
o To increase the Fund's return as a
non-hedging strategy that may be
considered speculative
Even a small investment in derivatives can
have a significant impact on the Fund's
exposure to interest rates. If changes in a
derivative's value do not correspond to
changes in the value of the Fund's other
investments, the Fund may not fully benefit
from or could lose money on the derivative
position. In addition, some derivatives
involve risk of loss if the person who
issued the derivative defaults on its
obligation. Certain derivatives may be less
liquid and more difficult to value. The Fund
will only invest in derivatives to the
extent Pioneer believes these investments do
not prevent the Fund from seeking its
investment objective.
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
Short-term trading The Fund may engage in the technique of The Fund usually does not trade for short-term
short-term trading. Such trading involves the profits. The Fund will sell an investment,
selling of securities held for a short time, however, even if it has only been held for a
ranging from several months to less than a short time, if it no longer meets the Fund's
day. The object of such short-term trading is investment criteria.
to increase the potential for capital
appreciation and/or income of the Fund in
order to take advantage of what AAMI believes
are changes in market, industry or individual
company conditions or outlook. Any such
trading would increase the turnover rate of a
Fund and its transaction costs.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 4.00% of the sales charge up to 4.50% of the offering
offering price, which is reduced depending price, which is reduced or waived for
upon the amount invested or, in certain large purchases and certain types of
circumstances, waived. Class A shares investors. At the time of your purchase,
bought as part of an investment of $1 your investment firm may receive a
million or more are not subject to an commission from Pioneer Funds Distributor,
initial sales charge, but may be charged a Inc. ("PFD"), the Fund's distributor, of
contingent deferred sales charge ("CDSC") up to 5% declining as the size of your
of 1.00% if sold within one year of investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing circumstances when the initial sales
fee (non 12b-1) of up to 0.25% of average charge is waived.
daily net assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
Class B sales charges Class B shares are offered without an initial Class B shares are offered without an initial
and Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive
continuously declines over six years, a commission from PFD, the Fund's
starting with year one and ending in year distributor, at the time of your purchase of
seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all up to 4%.
other Class B shares held continuously, the
CDSC declines over six years, starting with Class B shares are subject to distribution
year one and ending in year seven from: 5%, and service (12b-1) fees of up to 1% of
4%, 3%, 3%, 2%, 1%. Eight years after average daily net assets.
purchase (seven years in the case of Shares
acquired in the ISG combination), Class B Class B shares acquired through the
shares automatically convert to Class A Reorganization will be subject to the CDSC
shares. and commission schedules applicable to the
original purchase.
Class B shares pay a shareholder servicing
fee (non 12b-1) of 0.25% of average daily net Maximum purchase of Class B shares in a
single transaction is $49,999.
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
assets and a distribution (12b-1) fee of single transaction is $49,999.
0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y sales AmSouth Florida Tax-Exempt Fund does not The Fund does not impose any initial,
charges and Rule 12b-1 fees impose any initial or CDSC on Class I shares. contingent deferred or asset based sales
charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth Florida Tax-Exempt Fund pays an Pioneer Florida Tax Free Income Fund will pay
advisory fee on a monthly basis at an annual Pioneer an advisory fee as follows: 0.50% of
rate of 0.50% of the Fund's average daily net the Fund's average daily net assets on the
assets. first $250 million, 0.45% on assets greater
than $250 million to $750 million, and 0.40%
ASO Services Company, Inc. ("ASO") serves as on assets greater than $750 million. The fee
administrator and fund accounting agent for is computed daily and paid monthly.
the Fund. The Fund pays ASO an administrative
services fee of 0.15% of the Fund's average In addition, the Fund reimburses Pioneer for
daily net assets. certain fund accounting and legal expenses
incurred on behalf of the Fund and pays a
Other expenses are being limited to 0.33% for separate shareholder servicing/transfer
Class A shares, 0.33% for Class B shares and agency fee to PIMSS, an affiliate of Pioneer.
0.18% for Class I shares. Any fee waiver or
expense reimbursement arrangement is The Fund's annual fund operating expenses for
voluntary and may be discontinued at any Class A shares, after giving effect to the
time. expense limitation, are estimated to be
0.82%, and without giving effect to the
For the fiscal year ended July 31, 2004, the expense limitation, are estimated to be 0.98%
Fund's annual operating expenses for Class A of average daily net assets for the current
shares, after giving effect to the expense fiscal year.
limitation were 0.83% and without giving
effect to the expense limitation, were 1.03% The Fund's annual fund operating expenses for
of average daily net assets. Class B shares, after giving effect to the
expense limitation, are estimated to be
For the fiscal year ended July 31, 2004, the 1.72%, and without giving effect to the
Fund's annual operating expenses for Class B expense limitation, are estimated to be 1.76%
shares, after giving effect to the expense of average daily net assets for the current
limitation were 1.58%, and without giving fiscal year.
effect to the expense limitation, were 1.78%
of average daily net assets. The Fund's annual fund operating expenses for
Class Y shares are estimated to be 0.70% of
For the fiscal year ended July 31, 2004, the average daily net assets for the current
Fund's annual operating expenses for Class I fiscal year.
shares, after giving effect to the expense
limitation were 0.68%, and without giving
effect to the expense limitation, were 0.93%
of average daily net assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Pioneer Fund's distributor.
investment advisers, banks and other
financial institutions that have entered into If the account is established in the
selling
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------------
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Fund by
telephone or online
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum $1,000. The Fund allows you to exchange
investment requirements for the Fund into your shares at net asset value without charging
which you are exchanging. Exchanges from you either an initial or contingent deferred
one Fund to another are taxable. Class A shares shares charge at the time of the exchange.
may be exchanged for Class I shares of the Shares you acquire as part of an exchange will
same Fund or another AmSouth Fund if you continue to be subject to any contingent
become eligible to purchase Class I shares. deferred sales charge that applies to the shares
Class I shares may be exchanged for Class A you originally purchased. When you
shares of the same Fund. No transaction fees ultimately sell your shares, the date of your
are currently charged for exchanges. original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days purchase of shares for federal income tax
of the date of purchase, you will be charged a purposes.
2.00% fee on the current net asset value of the
shares sold or exchanged. The fee is paid to the After you establish an eligible Fund account,
Fund to offset the costs associated with short- you can exchange Fund shares by telephone or
term trading, such as portfolio transaction and online.
administrative costs.
The Fund uses a "first-in, first-out" method to
determine how long you have held your shares.
This means that if you purchased shares on
different days, the shares purchased first will
be considered redeemed first for purposes of
determining whether the redemption fee will be
charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator or
brokerage firm to implement the fee). The Fund
will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send
Fund directly in writing or by telephone or by your request to sell shares to PIMSS. You
contacting a financial intermediary as described can also sell your shares by contacting the Fund
in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
|
AmSouth Florida Tax-Exempt Fund Pioneer Florida Tax Free Income Fund
------------------------------------------------------------------------------------------------------------------------------
shareholder's own name, shareholders may
also redeem shares of the Fund by telephone
or online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. Even though the Funds seek current income exempt from federal and Florida intangible personal property tax, you could lose money on your investment or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o The issuer of a security owned by the Fund defaults on its obligation to pay principal and/or interest or has its credit rating downgraded
o New federal or state legislation adversely affects the tax-exempt status of securities held by the Fund or the financial ability of municipalities to repay these obligations
o The issuer of a security owned by the Fund may not be able to make timely payments because of a general economic downturn or increased governmental costs
o Because the Fund concentrates its investments in a single state, there may be more fluctuation in the value of its securities than is the case for mutual funds whose portfolios are more geographically diverse. Because the Fund invests primarily in securities issued by Florida and its municipalities, it is more vulnerable to unfavorable developments in Florida than are funds that invest in municipal securities of many states. Unfavorable developments in any economic sector may adversely affect the overall Florida municipal market
o The adviser is incorrect in its expectation of changes in interest rates or the credit quality of an issuer
Although distributions of interest income from the Fund's tax-exempt securities are generally exempt from regular federal income tax and Florida intangible personal property tax, distributions from other sources, including capital gain distributions and any gains on the sale of your shares, are not. You should consult a tax adviser about state and local taxes on your Fund distributions.
At times, more than 25% of the Fund's assets may be invested in the same market segment, such as financials. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus. For example, industries in the financial segment, such as banks, insurance companies, broker-dealers and REITs, may be sensitive to changes in interest rates and general economic activity and are subject to extensive government regulation.
The Fund generally invests in a limited number of securities and, as a result, the Fund's performance may be more volatile than the performance of funds holding more securities.
Past Performance
Set forth below is performance information for AmSouth Florida Tax-Exempt Fund. The bar charts show how AmSouth Florida Tax-Exempt Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return for AmSouth Florida Tax-Exempt Fund over time for each class of shares compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in AmSouth Florida Tax-Exempt Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance does not indicate future results. Pioneer Florida Tax Free Income Fund has not commenced investment operations.
AmSouth Florida Tax-Exempt Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 11.04 1996 3.6 1997 6.54 1998 5.44 1999 -1.33 2000 8.36 2001 4.47 2002 8.43 2003 3.04 2004 1.38 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 4.40% for the quarter ended March 31, 1995, and the lowest quarterly return was -2.12% for the quarter ended June 30, 2004.
AmSouth Florida Tax-Exempt Fund Average Annual Total Returns (for the periods ending December 31, 2004)
1 Year 5 Years 10 Years
-------------------------------------------------------------------------------------------
AmSouth Florida Tax-Exempt Fund, Class A Shares(1)
-------------------------------------------------------------------------------------------
Return Before Taxes -2.64% 4.25% 4.61%
-------------------------------------------------------------------------------------------
Return After Taxes on Distributions -2.80% 4.21% 4.55%
-------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -0.64% 4.14% 4.50%
-------------------------------------------------------------------------------------------
AmSouth Florida Tax-Exempt Fund, Class B Shares(2)
-------------------------------------------------------------------------------------------
Return Before Taxes -4.25% 3.98% 4.14%
-------------------------------------------------------------------------------------------
AmSouth Florida Tax-Exempt Fund, Class I Shares'(3)
-------------------------------------------------------------------------------------------
Return Before Taxes 1.52% 5.27% 5.15%
-------------------------------------------------------------------------------------------
Return After Taxes on Distributions 1.35% 5.23% 5.09%
-------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 2.16% 5.05% 5.00%
-------------------------------------------------------------------------------------------
Merrill Lynch 1-12 Year Municipal Bond Index(4) 3.43% 6.66% 6.48%
(reflects no deduction for fees, expenses or taxes)
-------------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 9/30/94.
(2) Performance for the Class B shares, which were first offered on 3/16/99, is
based on the historical performance of the Fund's Class A shares (without
sales charge) prior to that date. The historical performance of the Class B
shares has been restated to reflect the Fund's Class B shares distribution
(12b-1) fees and the contingent deferred sales charge.
(3) Performance for the Class I shares, which were first offered on 9/2/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date.
(4) Merrill Lynch 1-12 Year Municipal Bond Index, an unmanaged index generally representative of municipal bonds with intermediate maturities of no less than one year and no more than twelve years. The Index is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on the AmSouth Florida Tax-Exempt Fund's returns. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown
are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
The most recent portfolio manager's discussion of AmSouth Florida Tax-Exempt Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The table below shows the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the table appearing below are based on (i) for the AmSouth Florida Tax-Exempt Fund, the expenses of AmSouth Florida Tax-Exempt Fund for the period ended January 31, 2005 and (ii) for the Pioneer Florida Tax Free Income Fund, the estimated pro forma annual expenses for the period ended May 31, 2005.
Shareholder AmSouth Florida Pro Forma AmSouth Florida Pro Forma AmSouth Florida Pro Forma
transaction fees Tax-Exempt Pioneer Florida Tax-Exempt Pioneer Florida Tax-Exempt Fund Pioneer Florida
(paid directly Fund(1) Tax Free Income Fund Tax Free Income Fund Tax Free Income
from your Fund Fund Fund
investment)
Class A Class A Class B Class B Class I Class Y
--------------------------------------------------------------------------------------------------------------------------------
Maximum sales charge 4.00%(2) 5.75%(2) None(2) None None None
(load) when you buy
shares as a
percentage of
offering price
--------------------------------------------------------------------------------------------------------------------------------
Maximum deferred None None 5.00%(3) 4.00% None None
sales charge (load)
as a percentage of
purchase price or
the amount you
receive when you
sell shares,
whichever is less
--------------------------------------------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) None 2.00%(4) None 2.00%(4) None
--------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating expenses
(deducted from fund
assets) (as a % of
average net assets)
--------------------------------------------------------------------------------------------------------------------------------
Management fee 0.50% 0.50% 0.50% 0.50% 0.50% 0.50%
--------------------------------------------------------------------------------------------------------------------------------
Distribution and None 0.25% 0.75% 1.00% None None
service (12b-1) fee
--------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.74%(5) 0.23% 0.97%(5) 0.26% 0.56%(5) 0.20%
--------------------------------------------------------------------------------------------------------------------------------
Total fund operating 1.24% 0.98% 2.22% 1.76% 1.06% 0.70%
expenses
--------------------------------------------------------------------------------------------------------------------------------
Expense 0.41% 0.16% 0.64% 0.04% 0.38% N/A
reimbursement/
reduction
--------------------------------------------------------------------------------------------------------------------------------
|
Shareholder AmSouth Florida Pro Forma AmSouth Florida Pro Forma AmSouth Florida Pro Forma
transaction fees Tax-Exempt Pioneer Florida Tax-Exempt Pioneer Florida Tax-Exempt Fund Pioneer Florida
(paid directly Fund(1) Tax Free Income Fund Tax Free Income Fund Tax Free Income
from your Fund Fund Fund
investment)
Class A Class A Class B Class B Class I Class Y
--------------------------------------------------------------------------------------------------------------------------------
Net fund operating 0.83% 0.82% 1.58% 1.72% 0.68% 0.70%
expenses
--------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for the AmSouth Fund are being limited to 0.33% for Class A shares, 0.33% for Class B shares and 0.18% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Pro Forma
Number of years you own AmSouth Florida Tax-Exempt Pioneer Florida Tax Free
your shares Fund Income Fund
---------------------------------------------------------------------------------
Class A
---------------------------------------------------------------------------------
Year 1 $ 521 $ 654
---------------------------------------------------------------------------------
Year 3 $ 778 $ 822
---------------------------------------------------------------------------------
Year 5 $ 1054 $ 1,039
---------------------------------------------------------------------------------
Year 10 $ 1,840 $ 1,664
---------------------------------------------------------------------------------
Class B --- assuming redemption at end of period
---------------------------------------------------------------------------------
Year 1 $ 725 $ 575
---------------------------------------------------------------------------------
Year 3 $ 994 $ 850
---------------------------------------------------------------------------------
Year 5 $ 1,390 $ 1,050
---------------------------------------------------------------------------------
Year 10 $ 2,307 $ 1,864
---------------------------------------------------------------------------------
Class B --- assuming no redemption
---------------------------------------------------------------------------------
Year 1 $ 225 $ 175
---------------------------------------------------------------------------------
Year 3 $ 694 $ 550
---------------------------------------------------------------------------------
Year 5 $ 1,190 $ 950
---------------------------------------------------------------------------------
Year 10 $ 2,307 $ 1,864
---------------------------------------------------------------------------------
Class I Class Y
---------------------------------------------------------------------------------
Year 1 $ 108 $ 72
---------------------------------------------------------------------------------
Year 3 $ 337 $ 224
---------------------------------------------------------------------------------
Year 5 $ 585 $ 390
---------------------------------------------------------------------------------
|
Year 10 $ 1,294 $ 871 --------------------------------------------------------------------------------- |
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Florida Tax-Exempt Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your Amsouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. . In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $2 billion in municipal securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Third, Pioneer Florida Tax Free Income Fund's management fee (0.50% of average daily net assets on the first $250 million, 0.45% on assets greater than $250 million to $750 million, and 0.40% on assets greater than $750 million) will be the same as or lower than the advisory fee of your Fund (0.50% of average daily net assets). The estimated pro forma expenses on a total basis of the Pioneer Fund after giving effect to the Reorganizations are expected to decline for all classes of shares. The estimated pro forma expenses on a net basis are also expected to decline for Class A shares. Although the estimated pro forma operating expenses for the AmSouth Fund's Class B and I shares are lower on a gross basis, the expenses are higher on a net basis. AmSouth Bank and its affiliates have informed the trustees that they will discontinue their expense limitations in the future. The trustees considered the positive factors associated with the reorganization to outweigh the negative factors, such as the increase in expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds will be the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that will not be paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduce per share expenses.
Fourth, the Class A, B and Y shares of Pioneer Florida Tax Free Income Fund received in the Reorganization will provide AmSouth Florida Tax-Exempt Fund shareholders with exposure to substantially the same investment product as they currently have.
Fifth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of AmSouth Florida Tax-Exempt Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Florida Tax-Exempt Fund approve the reorganization of their Fund into Pioneer Florida Tax Free Income Fund.
Pro Forma
AmSouth Florida Tax- Pioneer Florida Tax Free Pioneer Florida Tax Free
Exempt Fund Income Fund Income Fund
May 31, 2005 May 31, 2005 May 31, 2005
-------------------- ------------------------ ------------------------
Total Net Assets (in thousands) $ 52,512 N/A $ 52,512
Class A shares ............. $ 4,230 N/A $ 4,230
Class B shares ............. $ 2,473 N/A $ 2,473
Class I/Y shares ........... $ 45,809 N/A $ 45,809
Net Asset Value Per Share
Class A shares ............. $ 10.59 N/A $ 10.59
Class B shares ............. $ 10.56 N/A $ 10.56
Class I/Y shares ........... $ 10.60 N/A $ 10.60
Shares Outstanding
Class A shares ............. 399,350 N/A 399,350
Class B shares ............. 234,108 N/A 234,108
Class I/Y shares ........... 4,321,999 N/A 4,321,999
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth High Quality Municipal Bond Fund and Pioneer Tax Free Income Fund
PROPOSAL 1(p)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests in securities that are exempt from regular federal income tax and, consequently, the Funds have similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth High Quality Municipal Bond Fund to Pioneer Tax Free Income Fund
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Delaware statutory
organized as a Massachusetts business trust. trust.
Net assets as of March $333.3 million $340.7 million
31, 2005
Investment advisers Investment Adviser: Investment Adviser:
and portfolio AAMI Pioneer
managers
Portfolio Manager: Portfolio Manager:
Day-to-day management of AmSouth High Quality Day-to-day management of the Fund's portfolio
Municipal Bond Fund's portfolio is the is the responsibility of David Eurkus. Mr.
responsibility of Dorothy E. Thomas, CFA. Ms. Eurkus joined Pioneer as a senior vice
Thomas has more than 20 years of experience as president in January 2000 and has been an
an investment portfolio manager. Ms. Thomas has investment professional since 1969. From 1998
been associated with AmSouth's Trust Investment to 2000, Mr. Eurkus was a senior vice
Group since 1982 and is currently Senior Vice president of fixed income investing for the
President and Trust Investment Officer in Private Client Group at Brown Brothers
charge of tax-free fixed income investments. Harriman. Prior to that he was a senior vice
president at Putnam Investments.
Investment objective AmSouth High Quality Municipal Bond Fund seeks Pioneer Tax Free Income Fund seeks as high a
to produce as high a level of current federal level of current income exempt from federal
tax-exempt income as is consistent with the income taxes as possible consistent with the
preservation of capital. preservation of capital.
Primary investments Normally, AmSouth High Quality Municipal Bond Normally, Pioneer Tax Free Income Fund
Fund will invest at least 80% of its net invests at least 80% of its total assets in
assets in high quality municipal securities investment grade securities that provide
that provide income that is exempt from federal income that is exempt from regular federal
income tax and is not a tax preference item for income tax and may not be subject to the AMT.
purposes of the federal alternative minimum tax These investments include bonds, notes and
("AMT"). For purposes of this policy, net other debt instruments issued by or
|
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
assets include net assets plus borrowings for on behalf of states, counties,
investment purposes. Additionally, the Fund municipalities, territories and possessions
concentrates its investments in municipal of the United States and the District of
securities issued by the State of Alabama and Columbia and their authorities, political
its political subdivisions. The Fund invests in subdivisions, agencies or instrumentalities.
debt securities only if they are high-grade
(rated at the time of purchase in one of the
four highest rating categories by a nationally
recognized statistical rating organization or
determined by AAMI to be of comparable
quality). The Fund will have a dollar-weighted
average maturity of five to ten years.
Investment strategies AAMI's fixed income portfolio management Pioneer considers both broad economic factors
process focuses on the four key areas of and issuer-specific factors in selecting a
duration management, sector weights, position portfolio designed to achieve the Fund's
on the yield curve and security selection; investment objective. In assessing the
AAMI's goal is to add value in each of these appropriate maturity and rating weighting of
four areas through the active management of the the Fund's portfolio, Pioneer considers a
Fund's portfolio. Beginning with rigorous variety of factors that are expected to
fundamental analysis of the economy and taking influence economic activity and interest
into account characteristics of the current rates. These factors include fundamental
business and interest rate cycles, AAMI arrives economic indicators, such as the rates of
at a projection of the likely trend in interest economic growth and inflation, Federal
rates and adjusts duration accordingly. Reserve monetary policy and the relative
Analysis of the shape of the yield curve and value of the U.S. dollar compared to other
yield spreads among bond market sectors leads currencies. Once Pioneer determines the
to further refinements in strategy. preferable portfolio characteristics, Pioneer
selects individual securities based upon the
terms of the securities (such as yields
compared to U.S. Treasuries or comparable
issues), liquidity and rating and issuer
diversification. Pioneer also employs due
diligence and fundamental research, an
evaluation of the issuer based on its
financial statements and operations, to
assess an issuer's credit quality, taking
into account financial condition, future
capital needs and potential for change in
rating. In making these portfolio decisions,
Pioneer relies on the knowledge, experience
and judgment of its staff who have access to
a wide variety of research.
Other investments Under normal market conditions, the Fund may The Fund may invest in securities of any
invest up to 20% of its assets in obligations, maturity. The Fund may invest up to 25% or
the interest on which is either subject to more of its assets in issuers in any one or
federal income tax or treated as a preference more states or securities the payments on
item for purposes of the AMT. which are derived from gas, electric,
telephone, sewer and water segments of the
The Fund may invest 25% or more of its total municipal bond market. The Fund may invest up
assets in bonds, notes and warrants generally to 25% of its assets in industrial
issued by or on behalf of the State of Alabama development bonds.
and its political subdivisions, the interest on
The Fund may invest up to 20% of its net
|
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
which, in the opinion of the issuer's bond assets in securities of other investment
counsel at the time of issuance, is exempt from companies, investment grade commercial paper,
both federal income tax and Alabama personal U.S. government securities, U.S. or foreign
income tax and is not treated as a preference bank instruments and repurchase agreements.
item for purposes of the AMT.
The Fund may invest up to 10% of its net
assets in debt securities rated below
investment grade or, if unrated, of
equivalent quality as determined by Pioneer.
Debt securities rated below investment grade
are commonly referred to as "junk bonds" and
are considered speculative.
The Fund may invest up to 10% of its net
assets in inverse floating rate obligations
(a type of derivative instrument). Inverse
floating rate obligations represent interests
in tax-exempt bonds.
Temporary defensive For temporary defensive purposes, the Fund may For temporary defensive purposes, including
strategies increase its holdings in taxable obligations to during periods of unusual cash flows, the
over 20% of its assets and hold uninvested cash Fund may depart from its principal investment
reserves pending investment. Taxable strategies and invest part or all of its
obligations may include obligations issued or assets in securities with remaining
guaranteed by the U.S. government, its agencies maturities of less than one year, cash
or instrumentalities (some of which may be equivalents, or may hold cash.
subject to repurchase agreements), certificates
of deposit, demand and time deposits, bankers'
acceptances of selected banks, and commercial
paper meeting the Tax-Free Fund's quality
standards for tax-exempt commercial paper.
Diversification Each Fund is diversified and is subject to diversification requirements under the Internal
Revenue Code of 1986, as amended (the "Code").
Industry concentration AmSouth High Quality Municipal Bond Fund may Pioneer Tax Free Income Fund will not
not purchase any securities which would cause concentrate its assets in the securities of
more than 25% of the value of the Fund's total issuers in any one industry except that the
assets at the time of purchase to be invested Fund may invest 25% or more of its assets in
in securities of one or more issuers conducting issuers in any one or more states or
their principal business activities in the same securities the payments on which are derived
industry, provided that (a) there is no from gas, electric, telephone, sewer and
limitation with respect to obligations issued water segments of the municipal bond market.
or guaranteed by the U.S. government or its
agencies or instrumentalities, and repurchase
agreements secured by obligations of the U.S.
government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their activities
are primarily related to financing the
activities of
|
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
their parents; and (c) utilities will be
divided according to their services. For
example, gas, gas transmission, electric and
gas, electric, and telephone will each be
considered a separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental user.
Restricted and illiquid AmSouth High Quality Municipal Bond Fund may Pioneer Tax Free Income Fund may not invest
securities not invest more than 15% of its net assets in more than 15% of its net assets in securities
securities that are restricted as to resale, or that are illiquid and other securities that
for which no readily available market exists, are not readily marketable. Repurchase
including repurchase agreements providing for agreements maturing in more than seven days
settlement more than seven days after notice. will be included for purposes of the
foregoing limit.
Borrowing AmSouth High Quality Municipal Bond Fund may Pioneer Tax Free Income Fund may not borrow
not borrow money or issue senior securities, money, except from a bank for temporary or
except that the Fund may borrow from banks or emergency purposes and not for investment
enter into reverse repurchase agreements for purposes, and then only in an amount not
temporary emergency purposes in amounts up to exceeding 5% of the value of the Fund's total
10% of the value of its total assets at the assets at the time of borrowing.
time of such borrowing. The Fund will not
purchase securities while borrowings (including
reverse repurchase agreements) in excess of 5%
of its total assets are outstanding.
Lending AmSouth High Quality Municipal Bond Fund may Pioneer Tax Free Income Fund may not make
not make loans, except that the Fund may loans, except through the purchase of
purchase or hold debt instruments in accordance securities, including repurchase agreements,
with its investment objective and policies, may in accordance with its investment objective,
lend Fund securities in accordance with its policies and limitations.
investment objective and policies, and may
enter into repurchase agreements.
Derivative instruments AmSouth High Quality Municipal Bond Fund may Pioneer Tax Free Income Fund may use futures
invest in futures contracts and options thereon and options on securities, indices and
(interest rate futures contracts or index currencies, forward currency exchange
futures contracts, as applicable) to commit contracts and other derivatives. The Fund
funds awaiting investment, to maintain cash does not use derivatives as a primary
liquidity or for other hedging purposes. The investment technique and generally limits
value of the Fund's contracts may equal or their use to hedging. However, the Fund may
exceed 100% of the Fund's total assets, use derivatives for a variety of
although the Fund will not purchase or sell a non-principal purposes, including:
futures contract unless immediately afterwards
the aggregate amount of margin deposits on its o As a hedge against adverse changes in stock
existing futures positions plus the amount of market prices, interest rates or currency
premiums paid for related futures options exchange rates
|
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
entered into for other than bona fide hedging o As a substitute for purchasing or selling
purposes is 5% or less of its net assets. securities
o To increase the Fund's return as
a non-hedging strategy that may be
considered speculative
Short-term trading The Fund may engage in the technique of The Fund usually does not trade for
short-term trading. Such trading involves the short-term profits. The Fund will sell an
selling of securities held for a short time, investment, however, even if it has only been
ranging from several months to less than a day. held for a short time, if it no longer meets
The object of such short-term trading is to the Fund's investment criteria.
increase the potential for capital appreciation
and/or income of the Fund in order to take
advantage of what AAMI believes are changes in
market, industry or individual company
conditions or outlook. Any such trading would
increase the turnover rate of a Fund and its
transaction costs.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 4.00% of the offering sales charge of up to 4.50% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 4% declining as the
("CDSC") of 1.00% if sold within one year of size of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge
(non-12b-1) of up to 0.25% of average daily net is waived.
assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to contingent
to 5%. For Class B shares purchased prior to deferred sales charges of up to 4% if you
the combination of AmSouth Funds with ISG sell your shares. The charge is reduced over
Funds, the CDSC on such Class B shares held time and is not charged after five years.
continuously declines over six years, starting Your investment firm may receive a commission
with year one and ending in year seven from: from PFD, the Fund's distributor, at the time
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B of your purchase of up to 4%.
shares held continuously, the CDSC declines
|
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
over six years, starting with year one and Class B shares are subject to distribution
ending in year seven from: 5%, 4%, 3%, 3%, 2%, and service (12b-1) fees of up to 1% of
1%. Eight years after purchase (seven years in average daily net assets.
the case of shares acquired in the ISG
combination), Class B shares automatically Class B shares acquired through the
convert to Class A shares. Reorganization will be subject to the CDSC
and commission schedules applicable to the
Class B shares pay a shareholder servicing fee original purchase.
(non 12b-1) of up to 0.25% of average daily net
assets and a distribution (12b-1) fee of up to Maximum purchase of Class B shares in a
0.75% of average daily net assets. single transaction is $49,999.
Maximum investment for all Class B purchases by
a shareholder for the Fund's shares is $99,999.
Class I and Class Y sales AmSouth High Quality Municipal Bond Fund does The Fund does not impose any initial,
charges and Rule 12b-1 not impose any initial or CDSC on Class I contingent deferred or asset based sales
fees shares. charge on Class Y shares.
The Fund may impose a shareholder servicing fee The distributor incurs the expenses of
(non 12b-1) of up to 0.15% of average daily distributing the Fund's Class Y shares, none
net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth High Quality Municipal Bond Fund pays Pioneer Tax Free Income Fund pays Pioneer an
an advisory fee on a monthly basis at an annual annual fee equal to 0.50% of the Fund's
rate of 0.50% of the Fund's average daily net average daily net assets up to $250 million,
assets. 0.48% of the next $50 million and 0.45% on
assets over $300 million.
ASO Services Company, Inc. ("ASO") serves as
administrator and fund accounting agent for the In addition, the Fund reimburses Pioneer for
Fund. The Fund pays ASO an administrative certain Fund accounting and legal expenses
services fee of 0.15% of the Fund's average incurred on behalf of the Fund and pays a
daily net assets. separate shareholder servicing/transfer
agency fee to PIMSS, an affiliate of Pioneer.
Other expenses are being limited to 0.37% for
Class A shares, 0.37% for Class B shares and For the fiscal year ended December 31, 2004,
0.22% for Class I shares. Any fee waiver or the Fund's total annual operating for Class A
expense reimbursement arrangement is voluntary shares were 0.91% of average daily net
and may be discontinued at any time. assets.
For the fiscal year ended July 31, 2004, the For the fiscal year ended December 31, 2004,
Fund's annual operating expenses for Class A the Fund's total annual operating expenses
shares, after giving effect to the expense for Class B shares were 1.67% of average
limitation were 0.87% and without giving effect daily net assets.
to the expense limitation, were 0.99% of
average daily net assets. For the fiscal year ended December 31, 2004,
the Fund's total annual operating expenses
For the fiscal year ended July 31, 2004, the for Class Y shares were 0.55% of average
Fund's annual operating expenses for Class B daily net assets.
shares, after giving effect to the expense
limitation were 1.62%, and without giving
|
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
effect to the expense limitation, were 1.74% of
average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.72%, and without giving
effect to the expense limitation, were 0.89% of
average daily net assets.
Buying shares You may buy shares of the Fund directly through You may buy shares from any investment firm
BISYS Fund Services, the Fund's distributor, or that has a sales agreement with PFD, Pioneer
through brokers, registered investment advisers, Fund's distributor.
banks and other financial institutions that
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of Pioneer Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
Fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one Fund to another charging you either an initial or contingent
are taxable. Class A shares may be exchanged deferred shares charge at the time of the
for Class I shares of the same Fund or another exchange. Shares you acquire as part of an
AmSouth Fund if you become eligible to purchase exchange will continue to be subject to any
Class I shares. Class I shares may be exchanged contingent deferred sales charge that applies
for Class A shares of the same Fund. No to the shares you originally purchased. When
transaction fees are currently charged for you ultimately sell your shares, the date of
exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days of purchase of shares for federal income tax
the date of purchase, you will be charged a purposes.
2.00% fee on the current net asset value of the
shares sold or exchanged. The fee is paid to After you establish an eligible fund account,
the Fund to offset the costs associated with you can exchange Fund shares by telephone or
short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method to
determine how long you have held your shares.
This means that if you purchased shares on
different days, the shares purchased first will
be considered redeemed first for purposes of
determining whether the redemption fee will be
charged.
The fee will be charged on all covered
|
AmSouth High Quality Municipal Bond Fund Pioneer Tax Free Income Fund
----------------------------------------------------------------------------------------------------------------------------
redemptions and exchanges, including those made
through retirement plan, brokerage and other
types of omnibus accounts (except where it is
not practical for the plan administrator or
brokerage firm to implement the fee). The Fund
will not impose the redemption fee on a
redemption or exchange of shares purchased upon
the reinvestment of dividend and capital gain
distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Fund Normally, your investment firm will send your
directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Pioneer Fund by
telephone or online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o The issuer of a security owned by the Fund defaults on its obligation to pay principal and/or interest or has its credit rating downgraded
o New federal or state legislation adversely affects the tax-exempt status of securities held by the Fund or the financial ability of municipalities to repay these obligations
o To the extent the Fund concentrates its investments in a single state or securities the payments on which are dependent upon a single industry, the Fund will be more susceptible to risks associated with that state or industry
o The adviser is incorrect in its expectation of changes in interest rates or the credit quality of an issuer
In addition, at times, more than 25% of Pioneer Tax Free Income Fund's assets may be invested in the same market segment, such as financials or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
Pioneer Tax Free Income Fund may also invest up to 10% of its net assets in debt securities rated below investment grade or, if unrated, of equivalent quality as determined by Pioneer. Debt securities rated below investment grade are
commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher quality debt securities.
AmSouth High Quality Municipal Bond Fund may invest 25% or more of its total assets in bonds, notes and warrants generally issued by or on behalf of the State of Alabama and its political subdivisions, the interest on which, in the opinion of the issuer's bond counsel at the time of issuance, is exempt from both federal income tax and Alabama personal income tax and is not treated as a preference item for purposes of the federal alternative minimum tax. By concentrating its investments in securities issued by Alabama and its municipalities, the Fund will be more vulnerable to unfavorable developments in Alabama than funds that are more geographically diversified. Additionally, because of the relatively small number of issuers of Alabama municipal securities, the Fund is likely to invest in a limited number of issuers.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth High Quality Municipal Bond Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 10.36 1996 3.48 1997 6.18 1998 5.42 1999 -1.67 2000 8.82 2001 4.5 2002 8.63 2003 3.11 2004 1.54 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 3.79% for the quarter ended September 30, 2002, and the lowest quarterly return was -2.21% for the quarter ended June 30, 1999.
Pioneer Tax Free Income Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 16.84 1996 3.58 1997 8.94 1998 6.2 1999 -4.20 2000 11.63 2001 4.13 2002 7.06 2003 5.8 2004 4.76 |
* During the period shown in the bar chart, Pioneer Tax Free Income Fund's highest quarterly return was 7.11% for the quarter ended March 31, 1995, and the lowest quarterly return was -3.38% for the quarter ended June 30, 2004.
AmSouth High Quality Municipal Bond Fund Average Annual Total Returns (for the periods ending December 31, 2004)
1 Year 5 Years 10 Years
----------------------------------------------------------------------------------------------
AmSouth High Quality Municipal Bond Fund, Class A Shares
----------------------------------------------------------------------------------------------
Return Before Taxes(1) -2.55% 4.42% 4.55%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions -2.64% 4.38% 4.49%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -0.51% 4.30% 4.34%
----------------------------------------------------------------------------------------------
AmSouth High Quality Municipal Bond Fund, Class B Shares(2)
----------------------------------------------------------------------------------------------
Return Before Taxes -4.09% 4.16% 4.08%
----------------------------------------------------------------------------------------------
AmSouth High Quality Municipal Bond Fund, Class I Shares,(3)
----------------------------------------------------------------------------------------------
Return Before Taxes 1.78% 5.45% 5.09%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions 1.69% 5.41% 5.04%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 2.40% 5.23% 4.84%
----------------------------------------------------------------------------------------------
Merrill Lynch 1-12 Year Municipal Bond Index(4) 3.43% 6.66% 6.48%
(reflects no deduction for fees, expenses or taxes)
----------------------------------------------------------------------------------------------
|
(1) The Fund commenced operations on 7/1/97, through a transfer of assets from certain collective trust fund ("commingled") accounts advised by AmSouth Bank, using substantially the same investment objective, policies and methodologies as the Fund. The quoted before-tax returns of the Fund includes the performance of the commingled accounts for periods dating back to 7/31/93, and prior to the Fund's commencement of operations, restated to reflect the expenses associated with the Fund. The commingled accounts were not registered with the SEC and, therefore, were not subject to the investment restrictions imposed by law on registered mutual funds. If the commingled accounts had been registered, their performance may have been adversely affected. After-tax returns reflect performance since 7/1/97, and do not include the performance of the commingled accounts prior to that date. Class A shares were first offered on 7/1/97.
(2) Performance for the Class B shares, which were first offered on 2/3/99, is based on the historical performance of the Fund's Class A shares, including the performance of the commingled accounts (without sales charge) prior to that date. The commingled accounts were managed using substantially the same investment objective, policies and methodologies as the Fund. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the contingent deferred sales charge.
(3) Performance for the Class I shares, which were first offered on 9/2/97, is based on the historical performance of the Fund's Class A shares, including the performance of the commingled accounts (without sales charge) prior to that date. The commingled accounts were managed using substantially the same investment objective, policies and methodologies as the Fund.
(4) Merrill Lynch 1-12 Year Municipal Bond Index, an unmanaged index generally representative of municipal bonds with intermediate maturities of no less than one year and no more than twelve years, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on the AmSouth High Quality Municipal Bond Fund's returns. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Tax Free Income Fund Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
----------------------------------------------------------------------------------------------
Pioneer Tax Free Income Fund, Class A Shares
----------------------------------------------------------------------------------------------
Return Before Taxes 0.05% 5.66% 5.88%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions 0.05% 5.56% 5.65%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 1.69% 5.52% 5.66%
----------------------------------------------------------------------------------------------
Pioneer Tax Free Income Fund, Class B Shares
----------------------------------------------------------------------------------------------
Return Before Taxes 0.07% 5.84% N/A
----------------------------------------------------------------------------------------------
Pioneer Tax Free Income Fund, Class Y Shares(1)
----------------------------------------------------------------------------------------------
Return Before Taxes 5.14% 6.26% 6.14%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions 5.14% 6.16% 5.91%
----------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 5.21% 6.02% 5.88%
----------------------------------------------------------------------------------------------
Lehman Brothers Municipal Bond Index (2) 4.48% 7.20% 7.06%
(reflects no deduction for fees, expenses or taxes)
----------------------------------------------------------------------------------------------
|
(1) Reflects the inception of the Fund's Class A shares. The inception of Class Y shares was February 28, 2002.
(2) Lehman Brothers Municipal Bond Index, an unmanaged measure of approximately 15,000 municipal bonds, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth High Quality Municipal Bond Fund, the expenses of AmSouth High Quality Municipal Bond Fund for the period ended January 31, 2005 and (ii) for Pioneer Tax Free Income Fund, the expenses of Pioneer Tax Free Income Fund for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. Shareholders of AmSouth Tennessee Tax-Exempt Fund are also being asked to approve the reorganization of their fund into Pioneer Tax Free Income Fund. The tables also show (1) the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004,(2) the pro forma expenses of the combined Fund assuming the reorganization of AmSouth Tennessee Tax-Exempt Fund into Pioneer Tax Free Income Fund also occurred on December 31, 2004.
Combined
Fund
(including
Shareholder AmSouth
transaction AmSouth Pioneer Combined Tennessee AmSouth High Pioneer
fees (paid High Quality Tax Free Fund Tax-Exempt Quality Tax Free
directly Municipal Income (Pro Fund) Municipal Income
from your Bond Fund(1) Fund Forma) (Pro Forma) Bond Fund(1) Fund
investment) Class A Class A Class A Class A Class B Class B
--------------------------------------------------------------------------------------------------------
Maximum sales charge (load) when
you buy shares as a percentage
of offering price 4.00%(2) 4.50%(2) 4.50%(2) 4.50% None None
--------------------------------------------------------------------------------------------------------
Maximum deferred sales charge
(load) as a percentage of
purchase price or the amount
you receive when you sell
shares, whichever is less None None(5) None None 5.00%(3) 4.00%
--------------------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) None None None 2.00%(4) None
--------------------------------------------------------------------------------------------------------
Annual fund operating expenses
(deducted from fund assets)
(as a % of average net assets)
--------------------------------------------------------------------------------------------------------
Management fee 0.50% 0.49% 0.49% 0.49% 0.50% 0.49%
--------------------------------------------------------------------------------------------------------
Combined
Fund
(including Combined Fund
Shareholder AmSouth (including
transaction Tennessee AmSouth Combined AmSouth
fees (paid Combined Tax-Exempt High Quality Pioneer Fund Tennessee Tax-
directly Fund Fund) Municipal Tax Free (Pro Exempt Fund)
from your (Pro Forma) (Pro Forma) Bond Fund(1) Income Fund Forma) (Pro Forma)
investment) Class B Class B Class I Class Y Class Y Class Y
----------------------------------------------------------------------------------------------------------------
Maximum sales charge (load) when
you buy shares as a percentage
of offering price None None None None None None
----------------------------------------------------------------------------------------------------------------
Maximum deferred sales charge
(load) as a percentage of
purchase price or the amount
you receive when you sell
shares, whichever is less 4.00% 4.00% None None None None
----------------------------------------------------------------------------------------------------------------
Redemption fees None None 2.00%(4) None None None
----------------------------------------------------------------------------------------------------------------
Annual fund operating expenses
(deducted from fund assets)
(as a % of average net assets)
----------------------------------------------------------------------------------------------------------------
Management fee 0.49% 0.49% 0.50% 0.49% 0.49% 0.49%
----------------------------------------------------------------------------------------------------------------
|
Combined
Fund
(including
Shareholder AmSouth
transaction AmSouth Pioneer Combined Tennessee AmSouth High Pioneer
fees (paid High Quality Tax Free Fund Tax-Exempt Quality Tax Free
directly Municipal Income (Pro Fund) Municipal Income
from your Bond Fund(1) Fund Forma) (Pro Forma) Bond Fund(1) Fund
investment) Class A Class A Class A Class A Class B Class B
---------------------------------------------------------------------------------------------------------
Distribution and service (12b-1)
fee None 0.25% 0.25% 0.25% 0.75% 1.00%
---------------------------------------------------------------------------------------------------------
Other expenses 0.68%(5) 0.17% 0.17% 0.16% 0.88%(5) 0.18%
---------------------------------------------------------------------------------------------------------
Total fund operating expenses 1.18% 0.91%(6) 0.91% 0.90% 2.13% 1.67%(6)
---------------------------------------------------------------------------------------------------------
Expense reimbursement/reduction 0.30% N/A N/A N/A 0.50% N/A
---------------------------------------------------------------------------------------------------------
Net fund operating expenses 0.88% 0.91% 0.91% 0.90% 1.63% 1.67%
---------------------------------------------------------------------------------------------------------
Combined
Fund
(including Combined Fund
Shareholder AmSouth (including
transaction Tennessee AmSouth Combined AmSouth
fees (paid Combined Tax-Exempt High Quality Pioneer Fund Tennessee Tax-
directly Fund Fund) Municipal Tax Free (Pro Exempt Fund)
from your (Pro Forma) (Pro Forma) Bond Fund(1) Income Fund Forma) (Pro Forma)
investment) Class B Class B Class I Class Y Class Y Class Y
----------------------------------------------------------------------------------------------------------------
Distribution and service (12b-1)
fee 1.00% 1.00% None None None None
----------------------------------------------------------------------------------------------------------------
Other expenses 0.17% 0.16% 0.55%(5) 0.06% 0.06% 0.06%
----------------------------------------------------------------------------------------------------------------
Total fund operating expenses 1.66% 1.65% 1.05% 0.55%(6) 0.55% 0.55%
----------------------------------------------------------------------------------------------------------------
Expense reimbursement/reduction N/A N/A 0.32% N/A N/A N/A
----------------------------------------------------------------------------------------------------------------
Net fund operating expenses 1.66% 1.65% 0.73% 0.55% 0.55% 0.55%
----------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.38% for Class A shares, 0.38% for Class B shares and 0.23% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, (d) and each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Combined Fund
(including AmSouth
AmSouth High Tennessee Tax-
Number of years you Quality Municipal Pioneer Tax Free Combined Fund Exempt Fund)
own your shares Bond Fund Income Fund (Pro Forma) (Pro Forma)
--------------------------------------------------------------------------------------------
Class A
--------------------------------------------------------------------------------------------
Year 1 $ 515 $ 539 $ 663 $ 662
--------------------------------------------------------------------------------------------
Year 3 $ 760 $ 727 $ 848 $ 845
--------------------------------------------------------------------------------------------
Year 5 $1,023 $ 931 $1,050 $1,045
--------------------------------------------------------------------------------------------
Year 10 $1,775 $1,519 $1,630 $1,619
--------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
--------------------------------------------------------------------------------------------
Year 1 $ 716 $ 570 $ 569 $ 559
--------------------------------------------------------------------------------------------
Year 3 $ 967 $ 826 $ 823 $ 793
--------------------------------------------------------------------------------------------
Year 5 $1,344 $1,007 $1,002 $ 950
--------------------------------------------------------------------------------------------
Year 10 $2,220 $1,774 $1,766 $1,679
--------------------------------------------------------------------------------------------
Class B -- assuming no redemption
--------------------------------------------------------------------------------------------
Year 1 $ 216 $ 170 $ 169 $ 159
--------------------------------------------------------------------------------------------
Year 3 $ 667 $ 526 $ 523 $ 493
--------------------------------------------------------------------------------------------
Year 5 $1,144 $ 909 $ 902 $ 850
--------------------------------------------------------------------------------------------
Year 10 $2,220 $1,774 $1,766 $1,679
--------------------------------------------------------------------------------------------
Class I Class Y
--------------------------------------------------------------------------------------------
Year 1 $ 107 $ 56 $ 56 $ 56
--------------------------------------------------------------------------------------------
Year 3 $ 334 $ 176 $ 176 $ 176
--------------------------------------------------------------------------------------------
Year 5 $ 579 $ 307 $ 307 $ 307
--------------------------------------------------------------------------------------------
Year 10 $1,283 $ 689 $ 689 $ 689
--------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth High Quality Municipal Bond Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, after the Reorganization, the combined Fund will have an asset size substantially larger than that of your AmSouth Fund, which may allow the combined Fund to achieve significant economies of scale in investments or expenses.
Third, the historical investment performance of Pioneer Tax Free Income Fund is better than your AmSouth Fund's investment performance. For the one, five and ten year periods ended December 31, 2004, Class A shares of Pioneer Tax Free Income Fund had an average annual return of 0.05% (one year); 5.66% (five year); and 5.88% (ten year) compared to an average annual return of the Class A shares of your AmSouth Fund of -2.55% (one year); 4.42% (five year); and 4.55% (ten year), respectively, during the same period. The trustees also considered performance information provided for the one, three, and five year periods ended March 31, 2005 during which Class A shares of Pioneer Tax Free Income Fund had an average annual return of 3.30% (one year); 5.82% (three year); and 6.10% (five year), compared to an average annual return of the
Class A shares of your AmSouth Fund of -0.76% (one year); 3.73% (three year); and 4.64% (five year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Fourth, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fifth, Pioneer Tax Free Income Fund's management fee will benefit from breakpoints as assets increase as a result of the Reorganization. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. Although your AmSouth Fund's expenses attributable to Class A and Class B shares net of limitations are lower than the Pioneer Fund's net expenses currently and on a pro forma basis, your AmSouth Fund may terminate such limitations at any time. AAMI has informed the trustees that the expense waivers will be discontinued in the future. The trustees considered the positive factors associated with the Reorganization, such as superior performance of the Pioneer Fund, greater fund assets and potential for growth, to outweigh the negative factors. The gross expenses of Pioneer Fund's Class A, Class B and Class Y shares are lower than the AmSouth Fund's gross expenses attributable to Class A, Class B and Class I shares and are estimated to be lower on a pro forma basis after giving effect to the Reorgnization. In addition, the net expenses of the Class Y shares of the Pioneer Fund are lower than the net expenses of the AmSouth Fund attributable to Class I shares and are estimated to be lower on a pro forma basis. In addition, the broader distribution arrangement of the Pioneer Fund offers greater potential for further increases in net assets of the combined fund and lower per share expense ratios.
Sixth, the Class A, B and Y shares of Pioneer Tax Free Income Fund received in the Reorganization will provide AmSouth High Quality Municipal Bond Fund shareholders with exposure to substantially the same investment product as they currently have.
Seventh, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of AmSouth High Quality Municipal Bond Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Tennessee Tax-Exempt Bond Fund approve the reorganization of their fund into Pioneer Tax Free Income Fund.
Pro Forma
Pioneer Tax Free
Income Fund
Pro Forma (including
AmSouth High Pioneer Tax AmSouth
Quality Municipal Pioneer Tax Free Free Income Tennessee Tax-
Bond Fund Income Fund Fund Exempt Fund)
May 31, 2005 May 31, 2005 May 31,2005 May 31, 2005
----------------- ---------------- ----------- ----------------
Total Net Assets (in thousands) $ 329,216 $ 345,063 $ 674,278 $ 710,145
Class A shares ............... $ 15,588 $ 304,731 $ 320,318 $ 325,503
Class B shares ............... $ 3,739 $ 18,036 $ 21,775 $ 23,867
Class I/Y shares ............. $ 309,889 $ 143 $ 310,031 $ 338,622
Net Asset Value Per Share
Class A shares ............... $ 10.19 $ 11.78 $ 11.78 $ 11.78
Class B shares ............... $ 10.16 $ 11.68 $ 11.68 $ 11.68
Class I/Y shares ............. $ 10.19 $ 11.72 $ 11.72 $ 11.72
Shares Outstanding
Class A shares ............... 1,530,430 25,863,912 27,186,900 27,626,928
Class B shares ............... 367,964 1,544,680 1,864,939 2,044,084
Class I/Y shares ............. 30,409,602 12,181 26,453,521 28,893,022
|
It is impossible to predict how many shares of the Pioneer Tax Free Income Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Tennessee Tax-Exempt Fund and Pioneer Tax Free Income Fund
PROPOSAL 1(q)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Pioneer Tax Free Income Fund invests in municipal securities of issuers across the United States. AmSouth Tennessee Tax-Exempt Fund invests primarily in securities of issuers in Tennessee. Both Funds are exempt from regular federal income tax. In addition, AmSouth Tennessee Tax-Exempt Fund is exempt from Tennessee state income tax. Income from the Pioneer Fund is not exempt from Tennessee state income tax. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Tennessee Tax-Exempt Fund to Pioneer Tax Free Income Fund
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
Business A non-diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Delaware statutory
organized as a Massachusetts business trust. trust.
Net assets as of March $35.9 million $340.7 million
31, 2005
Investment advisers Investment Adviser: Investment Adviser:
and portfolio AAMI Pioneer
managers
Portfolio Manager: Day-to-day management of Portfolio Manager: Day-to-day management of
AmSouth Tennessee Tax-Exempt Fund's portfolio the Fund's portfolio is the responsibility of
is the responsibility of Dorothy E. Thomas, David Eurkus. Mr. Eurkus joined Pioneer as a
CFA. Ms. Thomas has more than 20 years of senior vice president in January 2000 and has
experience as an investment portfolio manager. been an investment professional since 1969.
Ms. Thomas has been associated with AmSouth's From 1998 to 2000, Mr. Eurkus was a senior
Trust Investment Group since 1982 and is vice president of fixed income investing for
currently Senior Vice President and Trust the Private Client Group at Brown Brothers
Investment Officer in charge of tax-free fixed Harriman. Prior to that he was a senior vice
income investments. president at Putnam Investments.
Investment objective AmSouth Tennessee Tax-Exempt Fund seeks to Pioneer Tax Free Income Fund seeks as high a
provide investors with current income exempt level of current income exempt from federal
from federal and Tennessee income taxes without income taxes as possible consistent with the
assuming undue risk. preservation of capital.
Primary investments Normally, AmSouth Tennessee Tax-Exempt Fund Normally, Pioneer Tax Free Income Fund
will invest at least 80% of its net assets in invests at least 80% of its total assets in
municipal securities of the State of Tennessee investment grade securities that provide
and its political subdivisions that provide income that is exempt from regular federal
income exempt from federal income tax and income tax and may not be subject to the AMT.
Tennessee personal income taxes. For purposes These investments include bonds, notes and
of this policy, net assets include net assets other debt instruments issued by or on behalf
plus borrowings for investment purposes. of states, counties, municipalities,
|
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
The Fund invests in Tennessee municipal territories and possessions of the United
securities only if they are high-grade (rated States and the District of Columbia and their
at the time of purchase in one of the four authorities, political subdivisions, agencies
highest rating categories by a nationally or instrumentalities.
recognized statistical rating organization or
determined by AAMI to be of comparable
quality). The Fund will have a dollar-weighted
average maturity of five to ten years. As a
non-fundamental policy, the Fund will normally
invest at least 80% of its net assets in
municipal securities that are not subject to
the federal alternative minimum tax ("AMT") for
individuals.
Investment strategies AAMI's fixed income portfolio management Pioneer considers both broad economic factors
process focuses on the four key areas of and issuer specific factors in selecting a
duration management, sector weights, position portfolio designed to achieve the Fund's
on the yield curve and security selection; investment objective. In assessing the
AAMI's goal is to add value in each of these appropriate maturity and rating weighting of
four areas through the active management of the the Fund's portfolio, Pioneer considers a
Fund's portfolio. Beginning with rigorous variety of factors that are expected to
fundamental analysis of the economy and taking influence economic activity and interest
into account characteristics of the current rates. These factors include fundamental
business and interest rate cycles, AAMI arrives economic indicators, such as the rates of
at a projection of the likely trend in interest economic growth and inflation, Federal
rates and adjusts duration accordingly. Reserve monetary policy and the relative
Analysis of the shape of the yield curve and value of the U.S. dollar compared to other
yield spreads among bond market sectors leads currencies. Once Pioneer determines the
to further refinements in strategy. preferable portfolio characteristics, Pioneer
selects individual securities based upon the
terms of the securities (such as yields
compared to U.S. Treasuries or comparable
issues), liquidity and rating and issuer
diversification. Pioneer also employs due
diligence and fundamental research, an
evaluation of the issuer based on its
financial statements and operations, to
assess an issuer's credit quality, taking
into account financial condition, future
capital needs and potential for change in
rating. In making these portfolio decisions,
Pioneer relies on the knowledge, experience
and judgment of its staff who have access to
a wide variety of research.
Other investments Under normal market conditions, the Fund may The Fund may invest in securities of any
invest up to 20% of its assets in taxable maturity.
obligations. For purposes of the 20% basket,
the Fund may also invest in municipal The Fund may invest up to 25% or more of its
securities of states other than Tennessee. assets in issuers in any one or more states
or securities the payments on which are
derived from gas, electric, telephone, sewer
and water segments of the municipal bond
market. The Fund may invest up to 25% of its
assets in industrial development bonds.
|
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
The Fund may invest up to 20% of its net
assets in securities of other investment
companies, investment grade commercial paper,
U.S. government securities, U.S. or foreign
bank instruments and repurchase agreements.
The Fund may invest up to 10% of its net
assets in debt securities rated below
investment grade or, if unrated, of
equivalent quality as determined by Pioneer.
Debt securities rated below investment grade
are commonly referred to as "junk bonds" and
are considered speculative.
The Fund may invest up to 10% of its net
assets in inverse floating rate obligations
(a type of derivative instrument). Inverse
floating rate obligations represent interests
in tax-exempt bonds.
Temporary defensive For temporary defensive purposes, the Fund may For temporary defensive purposes, including
strategies increase its holdings in taxable obligations to during periods of unusual cash flows, the
over 20% of its assets and hold uninvested cash Fund may depart from its principal investment
reserves pending investment. The Fund may also strategies and invest part or all of its
increase its holdings in municipal securities assets in securities with remaining
of states other than Tennessee to over 20% of maturities of less than one year, cash
its assets in such situations. Taxable equivalents or may hold cash.
obligations may include obligations issued or
guaranteed by the U.S. government, its agencies
or instrumentalities (some of which may be
subject to repurchase agreements), certificates
of deposit, demand and time deposits, bankers'
acceptances of selected banks, and commercial
paper meeting the Fund's quality for tax-exempt
commercial paper.
Diversification AmSouth Tennessee Tax-Exempt Fund is Pioneer Tax Free Income Fund is diversified
non-diversified for the purpose of the and is subject to diversification
Investment Company Act and, therefore, may requirements under the Internal Revenue Code
concentrate its investments in a limited number of 1986, as amended (the "Code").
of issuers.
Industry concentration AmSouth Tennessee Tax-Exempt Fund may not Pioneer Tax Free Income Fund will not
purchase any securities which would cause 25% concentrate its assets in the securities of
or more of the Fund's total assets at the time issuers in any one industry except that the
of purchase to be invested in the securities of Fund may invest 25% or more of its assets in
one or more issuers conducting their principal issuers in any one or more states or
business activities in the same industry; securities the payments on which are derived
provided that this limitation shall not apply from gas, electric, telephone, sewer and
to municipal securities; and provided, further, water segments of the municipal bond market.
that for the purpose of this limitation only,
private activity bonds that are backed only by
the assets and revenues of a non-governmental
user shall not be deemed to be municipal
securities.
|
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Tennessee Tax-Exempt Fund may not Pioneer Tax Free Income Fund may not invest
securities invest more than 15% of its net assets in more than 15% of its net assets in securities
securities that are restricted as to resale, or that are illiquid and other securities that
for which no readily available market exists, are not readily marketable. Repurchase
including repurchase agreements providing for agreements maturing in more than seven days
settlement more than seven days after notice. will be included for purposes of the
foregoing limit
Borrowing AmSouth Tennessee Tax-Exempt Fund may not Pioneer Tax Free Income Fund may not borrow
borrow money or issue senior securities, except money, except from a bank for temporary or
that the Fund may borrow from banks or enter emergency purposes and not for investment
into reverse repurchase agreements for purposes, and then only in an amount not
temporary emergency purposes in amounts up to exceeding 5% of the value of the Fund's total
33 1/3% of the value of its total assets at the assets at the time of borrowing.
time of such borrowing. The Fund will not
purchase securities while borrowings (including
reverse repurchase agreements) in excess of 5%
of its total assets are outstanding. In
addition, the Fund is permitted to participate
in a credit facility whereby the Fund may
directly lend to and borrow money from other
AmSouth Funds for temporary purposes, provided
that the loans are made in accordance with an
order of exemption from the SEC and any
conditions thereto.
Lending AmSouth Tennessee Tax-Exempt Fund may not make Pioneer Tax Free Income Fund may not make
loans, except that the Fund may purchase or loans, except through the purchase of
hold debt instruments in accordance with its securities, including repurchase agreements,
investment objective and policies, lend Fund in accordance with its investment objective,
securities in accordance with its investment policies and limitations.
objective and policies and enter into
repurchase agreements. In addition, the Fund is
permitted to participate in a credit facility
whereby the Fund may directly lend to and
borrow money from other AmSouth Funds for
temporary purposes, provided that the loans are
made in accordance with an order of exemption
from the SEC and any conditions thereto.
Derivative instruments AmSouth Tennessee Tax-Exempt Fund may invest in Pioneer Tax Free Income Fund may use futures
futures contracts and options thereon (interest and options on securities, indices and
rate futures contracts or index futures currencies, forward currency exchange
contracts, as applicable) to commit funds contracts and other derivatives. The Fund
awaiting investment, to maintain cash liquidity does not use derivatives as a primary
or for other hedging purposes. The value of the investment technique and generally limits
Fund's contracts may equal or exceed 100% of their use to hedging. However, the Fund may
the Fund's total assets, although the Fund will use derivatives for a variety of
not purchase or sell a futures contract unless non-principal purposes, including:
immediately afterwards the aggregate amount of
margin deposits on its existing futures o As a hedge against adverse changes in
positions plus the amount of premiums paid for stock market prices, interest rates or
related futures options entered into for other currency exchange rates
than bona fide hedging purposes is 5% or less
o As a substitute for purchasing or
|
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
of its net assets. selling securities
o To increase the Fund's return as a
non-hedging strategy that may be
considered speculative
Short-term trading The Fund may engage in the technique of The Fund usually does not trade for
short-term trading. Such trading involves the short-term profits. The Fund will sell an
selling of securities held for a short time, investment, however, even if it has only been
ranging from several months to less than a day. held for a short time, if it no longer meets
The object of such short-term trading is to the Fund's investment criteria.
increase the potential for capital appreciation
and/or income of the Fund in order to take
advantage of what AAMI believes are changes in
market, industry or individual company
conditions or outlook. Any such trading would
increase the turnover rate of a Fund and its
transaction costs.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different. For
a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 4.00% of the offering sales charge of up to 4.50% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A Shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 4% declining as the
("CDSC") of 1.00% if sold within one year of size of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge
(non 12b-1) of up to 0.25% of average daily net is waived.
assets.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.25% of
average daily net assets.
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B Shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B Shares held five years. Your investment firm may receive
continuously declines over six years, starting a commission from PFD, the Fund's
with year one and ending in year seven from: distributor, at the time of your purchase of
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B up to 4%.
Shares held continuously, the CDSC declines
over six years, starting with year one and Class B shares are subject to distribution
ending in year seven from: 5%, 4%, 3%, 3%, 2%, and service (12b-1) fees of up to 1% of
1%. Eight years after purchase (seven years in average daily net assets.
the case of Shares acquired in the ISG
combination), Class B Shares automatically Class B shares acquired through the
Reorganization will be subject to the CDSC
and commission schedules applicable to the
|
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
convert to Class A Shares. original purchase.
Class B Shares pay a shareholder servicing fee Maximum purchase of Class B shares in a
(non 12b-1) of up to 0.25% of average daily net single transaction is $49,999.
assets and a distribution (12b-1) fee of up to
0.75% of average daily net assets.
Maximum investment for all Class B purchases by
a shareholder for the Fund's shares is $99,999.
Class I and Class Y sales AmSouth Tennessee Tax-Exempt Fund does not The Fund does not impose any initial,
charges and Rule 12b-1 impose any initial or CDSC on Class I shares. contingent deferred or asset based sales
fees charge on Class Y shares.
The Fund may impose a shareholder servicing fee
(non 12b-1) of up to 0.15% of average daily The distributor incurs the expenses of
net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth Tennessee Tax-Exempt Fund pays an Pioneer Tax Free Income Fund pays Pioneer an
advisory fee on a monthly basis at an annual annual fee equal to 0.49% of the Fund's
rate of 0.50% of the Fund's average daily net average daily net assets up to $250 million,
assets. 0.48% of the next $50 million and 0.45% on
assets over $300 million.
ASO Services Company, Inc. ("ASO") serves as
administrator and fund accounting agent for the In addition, the Fund reimburses Pioneer for
Fund. The Fund pays ASO an administrative certain fund accounting and legal expenses
services fee of 0.15% of the Fund's average incurred on behalf of the Fund and pays a
daily net assets. separate shareholder servicing/transfer
agency fee to PIMSS, an affiliate of Pioneer.
Other expenses are being limited to 0.50% for
Class A Shares, 0.50% for Class B Shares and For the fiscal year ended December 31, 2004,
0.35% for Class I Shares. Any fee waiver or the Fund's total annual operating for Class A
expense reimbursement arrangement is voluntary shares were 0.91% of average daily net
and may be discontinued at any time. assets.
For the fiscal year ended July 31, 2004, the For the fiscal year ended December 31, 2004,
Fund's annual operating expenses for Class A the Fund's total annual operating expenses
shares, after giving effect to the expense for Class B shares were 1.67% of average
limitation were 1.00% and without giving effect daily net assets.
to the expense limitation, were 1.07% of
average daily net assets. For the fiscal year ended December 31, 2004,
the Fund's total annual operating expenses
For the fiscal year ended July 31, 2004, the for Class Y shares were 0.55% of average
Fund's annual operating expenses for Class B daily net assets.
shares, after giving effect to the expense
limitation were 1.75%, and without giving
effect to the expense limitation, were 1.82% of
average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.85%, and without giving
effect to the expense limitation, were 0.97% of
average daily net assets.
|
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of the Fund directly through You may buy shares from any investment firm
BISYS Fund Services, the Fund's distributor, or that has a sales agreement with PFD, the
through brokers, registered investment Pioneer Fund's distributor.
advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
Fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one Fund to another charging you either an initial or contingent
are taxable. Class A shares may be exchanged deferred shares charge at the time of the
for Class I shares of the same Fund or another exchange. Shares you acquire as part of an
AmSouth Fund if you become eligible to purchase exchange will continue to be subject to any
Class I shares. Class I Shares may be exchanged contingent deferred sales charge that applies
for Class A Shares of the same Fund. No to the shares you originally purchased. When
transaction fees are currently charged for you ultimately sell your shares, the date of
exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
If you sell your Shares or exchange them for generally is treated as a sale and a new
shares of another AmSouth Fund within 7 days of purchase of shares for federal income tax
the date of purchase, you will be charged a purposes.
2.00% fee on the current net asset value of the
Shares sold or exchanged. The fee is paid to After you establish an eligible fund account,
the Fund to offset the costs associated with you can exchange Fund shares by telephone or
short-term trading, such as portfolio online.
transaction and administrative costs.
The Fund uses a "first-in, first-out" method to
determine how long you have held your shares.
This means that if you purchased shares on
different days, the shares purchased first will
be considered redeemed first for purposes of
determining whether the redemption fee will be
charged.
The fee will be charged on all covered
redemptions and exchanges, including those made
through retirement plan, brokerage and other
types of omnibus accounts (except where it is
not practical for the plan administrator or
brokerage firm to implement the fee). The Fund
will not impose the redemption fee on a
redemption or exchange of shares purchased upon
the reinvestment of dividend and capital gain
distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send
|
AmSouth Tennessee Tax-Exempt Fund Pioneer Tax Free Income Fund
---------------------------------------------------------------------------------------------------------------------------
Fund directly in writing or by telephone or by your request to sell shares to PIMSS. You can
contacting a financial intermediary as also sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund primarily invests in municipal securities, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o The issuer of a security owned by the Fund defaults on its obligation to pay principal and/or interest or has its credit rating downgraded
o New federal or state legislation adversely affects the tax-exempt status of securities held by the Fund or the financial ability of municipalities to repay these obligations
o To the extent the Pioneer Fund concentrates its investments in a single state or securities the payments on which are dependent upon a single industry, the Fund will be more susceptible to risks associated with that state or industry. By concentrating its investments in securities issued by Tennessee and its municipalities, AmSouth Tennessee Tax-Exempt Fund will be more vulnerable to unfavorable developments in Tennessee than funds that are more geographically diversified.
o The adviser is incorrect in its expectation of changes in interest rates or the credit quality of an issuer
In addition, at times, more than 25% of Pioneer Tax Free Income Fund's assets may be invested in the same market segment, such as financials or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
Pioneer Tax Free Income Fund may also invest up to 10% of its net assets in debt securities rated below investment grade or, if unrated, of equivalent quality as determined by Pioneer. Debt securities rated below investment grade are commonly referred to as "junk bonds" and are considered speculative. Below investment grade debt securities involve greater risk of loss, are subject to greater price volatility and are less liquid, especially during periods of economic uncertainty or change, than higher quality debt securities.
AmSouth Tennessee Tax-Exempt Fund is subject to risks relating to the fact that it is non-diversified. The Fund may invest in a small number of companies which may increase the volatility of the Fund. Accordingly, the Fund's portfolio may be more sensitive to changes in the market value of a single company or industry.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Tennessee Tax-Exempt Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 13.4 1996 1.39 1997 7.13 1998 4.26 1999 -3.07 2000 8.65 2001 3.4 2002 8.43 2003 2.62 2004 1.22 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 5.91% for the quarter ended March 31, 1995, and the lowest quarterly return was -2.37% for the quarter ended June 30, 1999.
Pioneer Tax Free Income Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 16.84 1996 3.58 1997 8.94 1998 6.2 1999 -4.29 2000 11.63 2001 4.13 2002 7.06 2003 5.8 2004 4.76 |
* During the period shown in the bar chart, Pioneer Tax Free Income Fund's highest quarterly return was 7.11% for the quarter ended March 31, 1995, and the lowest quarterly return was -3.38% for the quarter ended June 30, 2004.
AmSouth Tennessee Tax-Exempt Fund Average Annual Total Returns (for the periods ending December 31, 2004)
1 Year 5 Years 10 Years
----------------------------------------------------------------------------------------------------------------
AmSouth Tennessee Tax-Exempt Fund, Class A Shares(1)
----------------------------------------------------------------------------------------------------------------
Return Before Taxes -2.87% 3.96% 4.22%
----------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions -3.03% 3.91% 4.18%
----------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -0.90% 3.83% 4.12%
----------------------------------------------------------------------------------------------------------------
AmSouth Tennessee Tax-Exempt Fund, Class B Shares(2)
----------------------------------------------------------------------------------------------------------------
Return Before Taxes -4.42% 3.69% 3.82%
----------------------------------------------------------------------------------------------------------------
AmSouth Tennessee Tax-Exempt Fund, Class I Shares,(3)
----------------------------------------------------------------------------------------------------------------
Return Before Taxes 1.36% 4.96% 4.77%
----------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 1.19% 4.91% 4.73%
----------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 1.94% 4.73% 4.63%
----------------------------------------------------------------------------------------------------------------
Merrill Lynch 1-12 Year Municipal Bond Index(4)
(reflects no deduction for fees, expenses or taxes) 3.43% 6.66% 6.48%
----------------------------------------------------------------------------------------------------------------
|
(1) The quoted returns reflect the performance from 3/28/94 to 3/12/00 of the ISG Tennessee Tax Exempt Fund, an open-end investment company that was the predecessor fund to the AmSouth Tennessee Tax-Exempt Fund. The ISG Tennessee Tax-Exempt Fund, commenced operations on 3/28/94, through a transfer of assets from certain collective trust fund ("commingled") accounts managed by First American National Bank, using substantially the same investment objective, policies and methodologies as the Fund. The quoted before-tax returns of the Fund includes the performance of the predecessor fund commingled accounts for periods dating back to 7/31/93, and prior to the Fund's commencement of operations, restated to reflect the expenses associated with the Fund. The commingled accounts were not registered with the SEC and, therefore, were not subject to the investment restrictions imposed by law on registered mutual funds. If the commingled accounts had been registered, their performance may have been adversely affected. After-tax returns reflect performance since 4/1/96, and do not include the performance of the commingled accounts prior to that date. Class A Shares were first offered on 3/28/94.
(2) Performance for the Class B Shares, which were first offered on 2/24/98, is based on the historical performance of the Fund's Class A Shares, including the performance of the predecessor fund and commingled accounts (without sales charge) prior to that date. The predecessor fund and commingled accounts were managed using substantially the same investment objective, policies and methodologies as the Fund. The historical performance of the Class B Shares has been restated to reflect the Fund's Class B Shares distribution (12b-1) fees and the contingent deferred sales charge.
(3) Performance for the Class I Shares, which were first offered on 10/3/97, is based on the historical performance of the Fund's Class A Shares, including the performance of the predecessor fund and commingled accounts (without sales charge) prior to that date. The predecessor fund and commingled accounts were managed using substantially the same investment objective, policies and methodologies as the Fund.
(4) Merrill Lynch 1-12 Year Municipal Bond Index, an unmanaged index generally representative of municipal bonds with intermediate maturities of no less than one year and no more than twelve years. The Index is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table shows the impact of taxes on the Fund's returns. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
Pioneer Tax Free Income Fund Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------
Pioneer Tax Free Income Fund, Class A shares
---------------------------------------------------------------------------------------------------------------
Return Before Taxes 0.05% 5.66% 5.88%
---------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 0.05% 5.56% 5.65%
---------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 1.69% 5.52% 5.66%
---------------------------------------------------------------------------------------------------------------
Pioneer Tax Free Income Fund, Class B shares
---------------------------------------------------------------------------------------------------------------
Return Before Taxes 0.07% 5.84% N/A
---------------------------------------------------------------------------------------------------------------
Pioneer Tax Free Income Fund, Class Y shares(1)
---------------------------------------------------------------------------------------------------------------
Return Before Taxes 5.14% 6.26% 6.14%
---------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 5.14% 6.16% 5.91%
---------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 5.21% 6.02% 5.88%
---------------------------------------------------------------------------------------------------------------
Lehman Brothers Municipal Bond Index(2) 4.48% 7.20% 7.06%
(reflects no deduction for fees, expenses or taxes)
---------------------------------------------------------------------------------------------------------------
|
(1) Reflects the inception of the Fund's Class A shares. The inception of Class Y shares was February 28, 2002.
(2) Lehman Brothers Municipal Bond Index is an unmanaged measure of approximately 15,000 municipal bonds is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Tennessee Tax-Exempt Fund, the expenses of AmSouth Tennessee Tax-Exempt Fund for the period ended January 31, 2005, and (ii) for Pioneer Tax Free Income Fund, the expenses of Pioneer Tax Free Income Fund for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. Shareholders of AmSouth High Quality Municipal Bond Fund are also being asked to approve the reorganization of their fund into Pioneer Tax Free Income Fund. The tables also show (1) the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004 and (2) the pro forma expenses of the combined Fund assuming the reorganization of AmSouth High Quality Municipal Bond Fund into Pioneer Tax Free Income Fund also occurred on December 31, 2004.
Shareholder AmSouth Pioneer Combined Combined AmSouth
transaction fees Tennessee Tax Free Fund Fund Tennessee Tax-
(paid directly Tax-Exempt Income (Pro Forma) (including Exempt Fund(1)
from your Fund(1) Fund AmSouth
investment) High Quality
Municipal
Bond Fund)
(Pro Forma)
Class A Class A Class A Class A Class B
---------------------------------------------------------------------------------------------
Maximum sales 4.00%(2) 4.50%(2) 4.50%(2) 4.50%(2) None
charge (load)
when you buy
shares as a
percentage of
offering price
---------------------------------------------------------------------------------------------
Maximum deferred None None None None 5.00%(3)
sales charge
(load) as a
percentage of
purchase price or
the amount you
receive when you
sell shares,
whichever is less
---------------------------------------------------------------------------------------------
Redemption fees 2.00%(4) None None None 2.00%(4)
---------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
---------------------------------------------------------------------------------------------
Management fee 0.50% 0.49% 0.49 0.49% 0.50%
---------------------------------------------------------------------------------------------
|
Shareholder Pioneer Combined Fund Combined AmSouth Pioneer Combined Fund Combined
transaction fees Tax Free (Pro Forma) Fund Tennessee Tax Free (Pro Forma) Fund
(paid directly Income (including Tax-Exempt Income Fund (including
from your Fund AmSouth High Fund(1) AmSouth High
investment) Quality Quality
Municipal Municipal
Bond Fund) Bond Fund)
(Pro Forma (Pro Forma
Class B Class B Class B Class I Class Y Class Y Class Y
-----------------------------------------------------------------------------------------------------------------------------
Maximum sales None None None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
-----------------------------------------------------------------------------------------------------------------------------
Maximum deferred 4.00% 4.00% 4.00% None None None None
sales charge
(load) as a
percentage of
purchase price or
the amount you
receive when you
sell shares,
whichever is less
-----------------------------------------------------------------------------------------------------------------------------
Redemption fees None None None 2.00%(4) None None None
-----------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
-----------------------------------------------------------------------------------------------------------------------------
Management fee 0.49% 0.49% 0.49% 0.50% 0.49% 0.49% 0.49%
-----------------------------------------------------------------------------------------------------------------------------
|
Shareholder AmSouth Pioneer Combined Combined AmSouth
transaction fees Tennessee Tax Free Fund Fund Tennessee Tax-
(paid directly Tax-Exempt Income (Pro Forma) (including Exempt Fund(1)
from your Fund(1) Fund AmSouth
investment) High Quality
Municipal
Bond Fund)
(Pro Forma)
Class A Class A Class A Class A Class B
---------------------------------------------------------------------------------------------
Distribution and None 0.25% 0.25% 0.25% 0.75%
service (12b-1)
fee
---------------------------------------------------------------------------------------------
Other expenses 0.83%(5) 0.17% 0.17% 00.19% 1.07%(5)
---------------------------------------------------------------------------------------------
Total fund 1.33% 0.91%(6) 0.91% 0.90% 2.32%
operating expenses
---------------------------------------------------------------------------------------------
Expense 0.33% N/A N/A N/A 0.57%
reimbursement/
reduction
---------------------------------------------------------------------------------------------
Net fund 1.00% 0.91% 0.91% 0.90% 1.75%
operating expenses
---------------------------------------------------------------------------------------------
|
Shareholder Pioneer Combined Fund Combined AmSouth Pioneer Combined Fund Combined
transaction fees Tax Free (Pro Forma) Fund Tennessee Tax Free (Pro Forma) Fund
(paid directly Income (including Tax-Exempt Income Fund (including
from your Fund AmSouth High Fund(1) AmSouth High
investment) Quality Quality
Municipal Municipal
Bond Fund) Bond Fund)
(Pro Forma (Pro Forma
Class B Class B Class B Class I Class Y Class Y Class Y
-----------------------------------------------------------------------------------------------------------------------------
Distribution and 1.00% 1.00% 1.00% None None None None
service (12b-1)
fee
-----------------------------------------------------------------------------------------------------------------------------
Other expenses 0.18% 0.18% 0.16% 0.60%(5) 0.06% 0.06% 0.06%
-----------------------------------------------------------------------------------------------------------------------------
Total fund 1.67%(6) 1.67% 1.65% 1.10% 0.55%(6) 0.55% 0.55%
operating expenses
-----------------------------------------------------------------------------------------------------------------------------
Expense N/A N/A N/A 0.25% N/A N/A N/A
reimbursement/
reduction
-----------------------------------------------------------------------------------------------------------------------------
Net fund 1.67% 1.67% 1.65% 0.85% 0.55% 0.55% 0.55%
operating expenses
-----------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase. See "Distribution Arrangements."
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B Shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for the AmSouth Fund are being limited to 0.50% for Class A shares, 050% for Class B shares and 0.35% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Number of years you own your AmSouth Tennessee Pioneer Tax Free Combined Fund Combined Fund
shares Tax-Exempt Fund Income Fund (Pro Forma) (including AmSouth
High Quality
Municipal Bond
Fund)
(Pro Forma)
--------------------------------------------------------------------------------------------------------------------
Class A
--------------------------------------------------------------------------------------------------------------------
Year 1 $ 530 $ 539 $ 663 $ 662
--------------------------------------------------------------------------------------------------------------------
Year 3 $ 805 $ 727 $ 848 $ 845
--------------------------------------------------------------------------------------------------------------------
Year 5 $ 1100 $ 931 $1,050 $1,045
--------------------------------------------------------------------------------------------------------------------
Year 10 $1,937 $1,519 $1,630 $1,619
--------------------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
--------------------------------------------------------------------------------------------------------------------
Year 1 $ 735 $ 570 $ 570 $ 559
--------------------------------------------------------------------------------------------------------------------
Year 3 $1,024 $ 826 $ 826 $ 793
--------------------------------------------------------------------------------------------------------------------
Year 5 $1,440 $1,007 $1,007 $ 950
--------------------------------------------------------------------------------------------------------------------
Year 10 $2,408 $1,774 $1,774 $1,679
--------------------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
--------------------------------------------------------------------------------------------------------------------
Year 1 $ 235 $ 170 $ 170 $ 159
--------------------------------------------------------------------------------------------------------------------
Year 3 $ 724 $ 526 $ 526 $ 493
--------------------------------------------------------------------------------------------------------------------
Year 5 $1,240 $ 909 $ 907 $ 850
--------------------------------------------------------------------------------------------------------------------
Year 10 $2,408 $1,774 $1,774 $1,679
--------------------------------------------------------------------------------------------------------------------
Class I Class Y
--------------------------------------------------------------------------------------------------------------------
Year 1 $ 112 $ 56 $ 56 $ 56
--------------------------------------------------------------------------------------------------------------------
Year 3 $ 350 $ 176 $ 176 $ 176
--------------------------------------------------------------------------------------------------------------------
Year 5 $ 606 $ 307 $ 307 $ 307
--------------------------------------------------------------------------------------------------------------------
Year 10 $1,340 $ 689 $ 689 $ 689
--------------------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Tennessee Tax-Exempt Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, after the Reorganization, the combined Fund will have an asset size substantially larger than that of your AmSouth Fund, which may allow the combined Fund to achieve significant economies of scale in investments or expenses.
Third, the historical investment performance of Pioneer Tax Free Income Fund is better than your AmSouth Fund's investment performance. For the one, five and ten year periods ended December 31, 2004, Class A shares of Pioneer Tax Free Income Fund had an average annual return of 0.05% (one year); 5.66% (five years); and 5.88% (ten years) compared to an average annual return of the Class A shares of your AmSouth Fund of -2.87% (one year); 3.96% (five years); and 4.22% (ten years), respectively, during the same period. The trustees also considered performance information provided for the one, three, and five year periods ended March 31, 2005 during which Class A shares of Pioneer Tax Free Income Fund had an average annual return of 3.30% (one year); 5.82% (three years); and 6.10% (five years), compared to an average annual return of the Class A shares of your AmSouth Fund of -0.81% (one year); 3.52% (three years); and 4.21% (five years), respectively, during
the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Fourth, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $2 billion in municipal securities. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fifth, the Pioneer Fund's management fee is lower than your Fund's management fee and will benefit from breakpoints as assets increase as a result of the Reorganization. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. The net and gross expenses of Class A, Class B and Class Y shares of Pioneer Tax Free Income Fund are currently lower than the gross and net expenses of the corresponding classes of your Fund and are estimated to be lower on a pro forma basis after giving effect to the Reorganization.
Sixth, although the Pioneer Tax Free Income Fund does not concentrate its investments in Tennessee and the dividends on the Pioneer Fund will not be exempt from Tennessee state taxes, your Board believes that the broader investment focus of the Pioneer Fund offered better long term prospects and potential for after tax return.
Seventh, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Fund in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth High Quality Municipal Bond Fund approve the reorganization of their fund into Pioneer Tax Free Income Fund.
Pro Forma
Pro Forma Pioneer Tax Free Income
Pioneer Tax Fund (including AmSouth
AmSouth Tennessee Pioneer Tax Free Free Income High Quality Municipal
Tax-Exempt Fund Income Fund Fund Bond Fund)
May 31, 2005 May 31, 2005 May 31, 2005 May 31, 2005
------------------- ----------------- ------------ -----------------------
Total Net Assets (in thousands) $ 35,867 $ 345,063 $ 380,929 $ 710,145
Class A shares .......................... $ 5,184 $ 304,731 $ 309,915 $ 325,503
Class B shares .......................... $ 2,092 $ 18,036 $ 20,128 $ 23,867
Class I/Y shares ........................ $ 28,591 $ 143 $ 28,733 $ 338,622
|
Net Asset Value Per Share
Class A shares .......................... $ 10.15 $ 11.78 $ 11.78 $ 11.78
Class B shares .......................... $ 10.16 $ 11.68 $ 11.68 $ 11.68
Class I/Y shares ........................ $ 10.15 $ 11.72 $ 11.72 $ 11.72
Shares Outstanding
Class A shares .......................... 510,534 25,863,912 26,303,940 27,626,928
Class B shares .......................... 205,863 1,544,680 1,723,825 2,044,084
Class I/Y shares ........................ 2,818,033 12,181 2,451,682 28,893,022
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Government Income Fund and Pioneer America Income Trust
PROPOSAL 1(r)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund seeks current income as is consistent with preservation of capital, and consequently, the Funds have similar investment policies and risks. Both Funds invest in U.S. government securities but the Pioneer Fund only invests in U.S. government securities backed by the full faith and credit of the U.S. Treasury. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Government Income Fund to Pioneer America Income Trust
AmSouth Government Income Fund Pioneer America Income Trust
--------------------------------------------------------------------------------------------------------------------------
Business A non-diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Massachusetts business
organized as a Massachusetts business trust. trust.
Net assets as of March $166.5 million $229.5 million
31, 2005
Investment advisers Investment Adviser: Investment Adviser:
and portfolio AAMI Pioneer
managers
Portfolio Managers: Portfolio Manager:
Day-to-day management of AmSouth Government Day-to-day management of the Fund's portfolio
Income Fund's portfolio is the responsibility is the responsibility of Richard Schlanger.
of John P. Boston, CFA and Michael T. Lytle, Mr. Schlanger is supported by the fixed income
CFA. Mr. Boston and Mr. Lytle were each named team. Members of this team manage other
co-manager of the Fund in 2004. Mr. Boston Pioneer funds investing primarily in fixed
managed the Fund from 1993 to 1998 and income securities. The portfolio manager and
co-managed the Fund from 1999 to 2002. He also the team also may draw upon the research and
manages AmSouth High Quality Bond Fund and investment management expertise of the global
AmSouth Limited Term Bond Fund and co-manages research team, which provides fundamental
AmSouth Balanced Fund. Mr. Boston is Chief research on companies and includes members
Fixed Income Officer for AAMI. Mr. Boston from Pioneer's affiliate, Pioneer Investment
began his career in investment management with Management Limited. Mr. Schlanger joined
AmSouth Bank in 1988 and has been associated Pioneer as a portfolio manager in 1988 after
with AAMI since 1996. spending 12 years with Irving Trust Company in
New York, where he had overall responsibility
Mr. Lytle joined AmSouth Bank's Asset for managing nearly $1.5 billion in fixed
Management Group in 1999 and AAMI in 2003. He income assets.
is a fixed-income portfolio manager for AAMI,
specializing in taxable fixed-income
securities.
Investment objective AmSouth Government Income Fund seeks current Pioneer America Income Fund seeks as high a
income consistent with the preservation level of current income as is consistent with
|
AmSouth Government Income Fund Pioneer America Income Trust
---------------------------------------------------------------------------------------------------------------------------
of capital. preservation of capital and prudent investment
risk.
Primary investments Under normal circumstances, the Fund will Pioneer America Income Trust invests
invest at least 80% of its net assets exclusively in securities that are backed by
primarily in obligations issued or guaranteed the full faith and credit of the U.S.
by the U.S. government or its agencies and government, and repurchase agreements and
instrumentalities. For the purpose of this "when-issued" commitments with respect to
policy, net assets include net assets plus these securities.
borrowings for investment purposes. The Fund
invests primarily in securities issued or Securities in which the Pioneer Trust may
guaranteed by the U.S. government, its invest include:
agencies or instrumentalities. These o U.S. Treasury obligations, which
investments are principally mortgage-related differ only in their interest rates,
securities, U.S. Treasury obligations and U.S. maturities and times of issuance,
government agency obligations. The Fund including U.S. Treasury bills (maturities
invests in securities issued by: (i) the of one year or less), U.S. Treasury notes
Government National Mortgage Association, (maturities of one to 10 years), and U.S.
which are supported by the full faith and Treasury bonds (generally maturities
credit of the U.S. government; (ii) the greater than 10 years)
Federal National Mortgage Association, the o Obligations issued by or guaranteed
Federal Home Loan Mortgage Corporation, the as to principal and interest by the U.S.
Student Loan Marketing Association ("SLMA") Treasury and certain agencies and
and the Federal Home Loan Banks ("FHLBs"), instrumentalities of the U.S. government,
which are supported by the right of the issuer such as Government National Mortgage
to borrow from the U.S. Treasury; (iii) the Association ("GNMA") certificates and
Federal Farm Credit Banks ("FFCBs") and the Federal Housing Administration ("FHA")
Tennessee Valley Authority ("TVA"), which are debentures, for which the U.S. Treasury
supported only by the credit of the issuer; unconditionally guarantees payment of
and (iv) the Private Export Funding principal and interest
Corporation ("PEFCO") which may be guaranteed
by the Export-Import Bank of the U.S. ("Exim The Fund's investments may have all types of
Bank"), an agency of the U.S. interest rate payment and reset terms,
including fixed rate, adjustable rate, zero
coupon, contingent, deferred, payment-in-kind
and auction rate features. The Fund may invest
in securities of any maturity. Although the
average dollar weighted maturity of the Fund's
portfolio may vary significantly, it generally
will not exceed 20 years.
Investment strategies AAMI's fixed income portfolio management Pioneer considers both broad economic factors
process focuses on the four key areas of and issuer specific factors in selecting a
duration management, sector weights, position portfolio designed to achieve the Fund's
on the yield curve and security selection; investment objective. In assessing the
AAMI's goal is to add value in each of these appropriate maturity and sector weighting of
four areas through the active management of the Fund's portfolio, Pioneer considers a
the Fund's portfolio. Beginning with rigorous variety of factors that are expected to
fundamental analysis of the economy and taking influence economic activity and interest rates.
into account characteristics of the current
business and interest rate cycles, AAMI These factors include fundamental economic
arrives at a projection of the likely trend in indicators, such as the rates of economic
interest rates and adjusts duration growth and inflation, Federal Reserve monetary
accordingly. Analysis of the shape of the policy and the relative value of the U.S.
yield curve and yield spreads among bond dollar compared to other currencies.
market sectors leads
|
AmSouth Government Income Fund Pioneer America Income Trust
---------------------------------------------------------------------------------------------------------------------------
to further refinements in strategy. Once Pioneer determines the preferable
portfolio characteristics, Pioneer selects
individual securities based upon the terms of
the securities (such as yields compared to U.S.
Treasuries or comparable issues and sector
diversification.
Other investments Up to 20% of the Fund's total assets may be The Fund may invest in mortgage-backed
invested in other types of debt securities, securities issued by certain agencies or
preferred stocks and options. The Fund may instrumentalities of the U.S. government.
invest up to 100% of its total assets in These securities represent direct or indirect
mortgage-related securities issued or participation in, or are collateralized by and
guaranteed by the U.S. government or its payable from, mortgage loans secured by real
agencies and instrumentalities such as GNMA, estate.
which are supported by the full faith and
credit of the U.S. government, and the Federal The Fund may purchase and sell securities,
National Mortgage Association ("FNMA") and including GNMA certificates, on a when-issued
Federal Home Loan Mortgage Corporation or delayed delivery basis. These transactions
("FHLMC"), which are supported by the right of arise when securities are purchased or sold by
the issuer to borrow from the U.S. Treasury, the Fund with payment and delivery taking
and in mortgage-related securities issued by place at a fixed future date. The Fund will not
nongovernmental entities which are rated, at earn income on these securities until
the time of purchase, in one of the four delivered. The Fund may engage in these
highest rating categories by a nationally transactions when it believes they would
recognized statistical rating organization result in a favorable price and yield for the
("NRSRO") or, if unrated, determined by AAMI security being purchased or sold.
to be of comparable quality.
The Fund's investments also include securities
issued by (i) SLMA and the FHLBs, which are
supported by the right of the issuer to borrow
from the U.S. Treasury; (ii) FFCBs and the
Tennessee Valley Authority, which are
supported only by the credit of the issuer;
and (iii) Private Export Funding Corporation,
which may be guaranteed by the Export Import
Bank of the U.S., an agency of the U.S.
The Fund may invest, to a limited extent, in
securities issued by other investment
companies that principally invest in
securities of the type in which the Fund
invests. Such investments will involve
duplication of advisory fees and certain other
expenses.
Temporary defensive When AAMI determines adverse market conditions Pioneer America Income Trust may invest all or
strategies exist, AmSouth Government Income Fund may part of its assets in securities with
invest entirely in cash positions, directly in remaining maturities of less than one year,
U.S. Government securities and short-term cash equivalents or may hold cash.
paper, such as bankers' acceptances.
|
AmSouth Government Income Fund Pioneer America Income Trust
---------------------------------------------------------------------------------------------------------------------------
Diversification AmSouth Government Income Fund is Pioneer America Income Trust is diversified
non-diversified for the purpose of the for the purpose of the Investment Company Act
Investment Company Act and, therefore, may and is subject to diversification requirements
concentrate its investments in a limited under the Internal Revenue Code of 1986, as
number of issuers. amended (the "Code").
Industry AmSouth Government Income Fund may not Pioneer America Income Trust does not have a
concentration purchase any securities which would cause more policy against industry concentration.
than 25% of the value of the Fund's total
assets at the time of purchase to be invested
in securities of one or more issuers
conducting their principal business activities
in the same industry, provided that (a) there
is no limitation with respect to obligations
issued or guaranteed by the U.S. government or
its agencies or instrumentalities, and
repurchase agreements secured by obligations
of the U.S. government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their
activities are primarily related to financing
the activities of their parents; and (c)
utilities will be divided according to their
services. For example, gas, gas transmission,
electric and gas, electric, and telephone will
each be considered a separate industry.
Restricted and illiquid AmSouth Government Income Fund may not invest Pioneer America Income Trust may not invest
securities more than 15% of its net assets in securities more than 15% of its net assets in securities
that are restricted as to resale, or for which which are illiquid and other securities which
no readily available market exists, including are not readily marketable. Repurchase
repurchase agreements providing for settlement agreements maturing in more than seven days
more than seven days after notice. will be included for purposes of the foregoing
limit.
Borrowing AmSouth Government Income Fund may not borrow Pioneer America Income Trust may not borrow
money or issue senior securities, except the money, except the Fund may: (a) borrow from
Fund may borrow from banks or enter into banks or through reverse repurchase agreements
reverse repurchase agreements for temporary in an amount up to 33 1/3% of the Fund's total
emergency purposes in amounts up to 33 1/3% of assets (including the amount borrowed); (b) to
the value of its total assets at the time of the extent permitted by applicable law, borrow
such borrowing. The Fund will not purchase up to an additional 5% of the Fund's assets
securities while borrowings (including reverse for temporary purposes; (c) obtain such
repurchase agreements) in excess of 5% of its short-term credits as are necessary for the
total assets are outstanding. clearance of portfolio transactions; (d)
purchase securities on margin to the extent
permitted by applicable law; and (e) engage in
transactions in mortgage dollar rolls that are
accounted for as financings.
Lending AmSouth Government Income Fund may not make Pioneer America Income Trust may not make
loans, except that the Fund may purchase or loans, except through the purchase of
hold debt instruments in accordance with its securities, including repurchase agreements in
investment objective and policies, lend Fund accordance with its investment objective,
|
AmSouth Government Income Fund Pioneer America Income Trust
---------------------------------------------------------------------------------------------------------------------------
securities in accordance with its investment policies and limitations.
objective and policies and enter into
repurchase agreements.
Derivative instruments AmSouth Government Income Fund may invest in Pioneer America Income Trust does not invest
futures contracts and options thereon in derivatives.
(interest rate futures contracts or index
futures contracts, as applicable) to commit
funds awaiting investment, to maintain cash
liquidity or for other hedging purposes. The
value of the Fund's contracts may equal or
exceed 100% of the Fund's total assets,
although the Fund will not purchase or sell a
futures contract unless immediately afterwards
the aggregate amount of margin deposits on its
existing futures positions plus the amount of
premiums paid for related futures options
entered into for other than bona fide hedging
purposes is 5% or less of its net assets.
Short-term trading The AmSouth Government Income Fund may engage Pioneer America Income Trust usually does not
in the technique of short-term trading. Such trade for short-term profits. The Fund will
trading involves the selling of securities sell an investment, however, even if it has
held for a short time, ranging from several only been held for a short time, if it no
months to less than a day. The object of such longer meets the Fund's investment criteria.
short-term trading is to increase the
potential for capital appreciation and/or
income of the Fund in order to take advantage
of what AAMI believes are changes in market,
industry or individual company conditions or
outlook.
Other investment As described above, the Funds have substantially similar principal investment strategies and
policies and policies. Certain of the non-principal investment policies and restrictions are different. For
restrictions a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges Class A shares are offered with an initial Class A shares are offered with an initial
and Rule 12b-1 fees sales charge of up to 4.00% of the offering sales charge of up to 4.50% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 5% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge is
(non 12b-1) of up to 0.25% of average daily waived. Additionally, purchases of $1 million
net assets. or more or and purchases of participants in
certain group plans may be subject to a CDSC
|
AmSouth Government Income Fund Pioneer America Income Trust
---------------------------------------------------------------------------------------------------------------------------
of 1%.
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges Class B shares are offered without an initial Class B shares are offered without an initial
and Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive a
continuously declines over six years, starting commission from PFD, the Fund's distributor,
with year one and ending in year seven from: at the time of your purchase of up to 4%.
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B
shares held continuously, the CDSC declines Class B shares are subject to distribution and
over six years, starting with year one and service (12b-1) fees of up to 1% of average
ending in year seven from: 5%, 4%, 3%, 3%, 2%, daily net assets.
1%. Eight years after purchase (seven years in
the case of shares acquired in the ISG Class B shares acquired through the
combination), Class B shares automatically Reorganization will be subject to the CDSC and
convert to Class A shares. commission schedules applicable to the
original purchase.
Class B shares pay a shareholder servicing fee
(non 12b-1) of 0.25% of average daily net
assets. This fee is in the form of a separate
non-Rule 12b-1 fee. All Funds bear a
distribution (12b-1) fee of 0.75%.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y AmSouth Government Income Fund does not impose The Fund does not impose any initial,
sales charges and Rule any initial or CDSC on Class I shares. contingent deferred or asset based sales
12b-1 fees charge on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
Management and AmSouth Government Income Fund pays an Pioneer America Income Trust pays Pioneer an
other fees advisory fee on a monthly basis at an annual annual fee equal to 0.50% of the Fund's
rate of 0.50% of the Fund's average daily net average daily net assets. The fee is computed
assets. daily and paid monthly.
ASO Services Company, Inc. ("ASO") serves as In addition, the Fund reimburses Pioneer for
administrator and fund accounting agent for certain Fund accounting and legal expenses
the Fund. The Fund pays ASO an administrative incurred on behalf of the Fund and pays a
services fee of 0.15% of the Fund's average separate shareholder servicing/transfer agency
daily net assets. fee to PIMSS, an affiliate of Pioneer.
Other expenses of the Fund are being limited Through August 31, 2005, Pioneer has
to 0.49% for Class A shares, 0.49% for Class B contractually agreed not to impose all or a
|
AmSouth Government Income Fund Pioneer America Income Trust
---------------------------------------------------------------------------------------------------------------------------
shares and 0.34% for Class I shares. Any fee portion of its management fee and, if
waiver or expense reimbursement arrangement is necessary, to limit other ordinary operating
voluntary and may be discontinued at any time. expenses to the extent required to reduce
Class A expenses to 1.50% of the average daily
For the fiscal year ended July 31, 2004, the net assets attributable to Class A shares. The
Fund's annual operating expenses for Class A portion of Fund expenses (including the amount
shares, after giving effect to the expense of the management fee waived) attributable to
limitation were 0.99%, and without giving Class Y shares will be reduced only to the
effect to the expense limitation, were 1.01% extent such expenses are reduced for Class A
of average daily net assets. shares.
For the fiscal year ended July 31, 2004, the For the fiscal year ended November 30, 2004,
Fund's annual operating expenses for Class B the Fund's total annual operating expenses for
shares, after giving effect to the expense Class A shares were 1.16% of average daily net
limitation were 1.74%, and without giving assets.
effect to the expense limitation, were 1.76%
of average daily net assets. For the fiscal year ended November 30, 2004,
the Fund's total annual operating expenses for
For the fiscal year ended July 31, 2004, the Class B shares were 1.98%.
Fund's annual operating expenses for Class I
shares, after giving effect to the expense For the fiscal year ended November 30, 2004,
limitation were 0.84%, and without giving the Fund's total annual operating expenses for
effect to the expense limitation, were 0.91% Class Y shares were 1.19% of average daily net
of average daily net assets. assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. The Fund allows you to exchange your
requirements for the Fund into which you are shares at net asset value without charging you
exchanging. Exchanges from one Fund to another either an initial or contingent deferred
are taxable. Class A shares may be exchanged shares charge at the time of the exchange.
for Class I shares of the same Fund or another Shares you acquire as part of an exchange will
AmSouth Fund if you become eligible to continue to be subject to any CDSC that
purchase Class I shares. Class I shares may be applies to the shares you originally
exchanged for Class A shares of the same Fund. purchased. When you ultimately sell your
No transaction fees are currently charged for shares, the date of your original purchase will
exchanges. determine your CDSC. An exchange generally is
treated as a sale and a new purchase of shares
If you sell your shares or exchange them for for federal income tax purposes.
shares of another AmSouth Fund within 7
days of the date of purchase, you will be After you establish an eligible Fund account,
charged a 2.00% fee on the current net asset you can exchange Fund shares by telephone or
value of the shares sold or exchanged. The fee online.
|
AmSouth Government Income Fund Pioneer America Income Trust
---------------------------------------------------------------------------------------------------------------------------
is paid to the Fund to offset the costs
associated with short-term trading, such as
portfolio transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares purchased
first will be considered redeemed first for
purposes of determining whether the redemption
fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator
or brokerage firm to implement the fee). The
Fund will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates increase, causing the value of investments to decline, a risk that is generally high for longer-term bonds and low for shorter-term bonds
o During periods of declining interest rates, the issuer of a security may exercise its option to prepay principal earlier than scheduled, forcing the Fund to reinvest in lower yielding securities. This is known as call or prepayment risk
o Interest rates decrease and the Fund's income declines. Income risk is generally high for shorter-term bonds and low for longer-term bonds
o The average life of certain types securities are extended because of slower than expected principal during periods of rising interest rates. This may lock in a below market interest rate, increase the security's duration (the estimated period until the security is paid in full) and reduce the value of the security. This is known as extension risk
o The adviser's judgment about the attractiveness, relative value or potential appreciation of a particular sector, security or investment strategy proves to be incorrect
AmSouth Government Income Fund is subject to risks relating to the fact that it is non-diversified. The Fund may invest in a small number of companies which may increase the volatility of the Fund. Accordingly, the Fund's portfolio may be more sensitive to changes in the market value of a single company or industry.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Government Income Fund -- Class A Calendar Year Total Returns*
[BAR CHART]
1995 14.38 1996 4.07 1997 9.35 1998 7.14 1999 0.63 2000 10.67 2001 7.01 2002 8.70 2002 1.46 2003 0.60 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 4.54% for the quarter ended June 30, 1995, and the lowest quarterly return was -1.77% for the quarter ended June 30, 2004.
Pioneer America Income Trust -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 16.06 1996 2.20 1997 8.51 1998 7.78 1999 -2.53 2000 11.58 2001 5.92 2002 9.77 2003 1.47 2004 2.39 |
* During the period shown in the bar chart since the Fund's inception June 1, 1998, Pioneer America Income Trust's highest quarterly return was 4.72% for the quarter ended June 30, 1995, and the lowest quarterly return was -2.07% for the quarter ended March 31, 1996.
AmSouth Government Income Fund Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------------------
AmSouth Government Income Fund, Class A Shares
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes -1.72% 5.12% 6.06%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions -3.25% 3.16% 3.84%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -1.13% 3.19% 3.81%
---------------------------------------------------------------------------------------------------------------------------
AmSouth Government Income Fund, Class B Shares(1)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes -3.25% 4.88% 5.58%
---------------------------------------------------------------------------------------------------------------------------
AmSouth Government Income Fund, Class I Shares(2)
---------------------------------------------------------------------------------------------------------------------------
Return Before Taxes 2.54% 6.14% 6.60%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 0.89% 4.10% 4.43%
---------------------------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 1.64% 4.03% 4.25%
---------------------------------------------------------------------------------------------------------------------------
Lehman Mortgage Index(3)
(reflects no deduction for fees, expenses or taxes) 4.70% 7.17% 7.56%
---------------------------------------------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 10/1/93. Performance for the Class B shares, which were first offered on 3/13/00, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the CDSC.
(2) Performance for the Class I shares, which were first offered on 9/2/97, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date.
(3) Lehman Mortgage Index, an unmanaged index generally representative of the mortgage bond market as a whole, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
Pioneer America Income Trust Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
----------------------------------------------------------------------------------------------------------
Pioneer America Income Trust, Class A shares
----------------------------------------------------------------------------------------------------------
Return Before Taxes -1.86% 5.26% 5.75%
----------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions(1) -3.34% 3.29% 3.46%
----------------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and
Sale of Fund Shares(1) -1.22% 3.28% 3.47%
----------------------------------------------------------------------------------------------------------
Pioneer America Income Trust, Class B shares
----------------------------------------------------------------------------------------------------------
Return Before Taxes -1.92% 5.37% 5.41
----------------------------------------------------------------------------------------------------------
Pioneer America Income Trust, Class Y shares(3)
----------------------------------------------------------------------------------------------------------
Lehman Brothers Government Bond Index(2)
(reflects no deduction for fees, expenses
or taxes) 3.48% 7.48% 7.46
----------------------------------------------------------------------------------------------------------
Lehman Brothers Fixed Rate Mortgage-Backed
Securities Index(4) (reflects no deduction
for fees, expenses or taxes) 4.70% 7.14% 7.56%
----------------------------------------------------------------------------------------------------------
|
(1) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on your situation and may differ from those shown. Furthermore, the after-tax returns shown are not relevant to those who hold their shares through tax-deferred arrangements such as 401(k) plans or IRA accounts, or to investors that are tax-exempt.
(2) The Lehman Brothers Government Bond Index is an unmanaged measure of the performance of U.S. Treasury debt, all publicly issued debt of U.S. government agencies and quasi-federal corporations, and corporate debt guaranteed by the U.S. government. The Lehman Brother Government Bond Index is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
(3) Class Y shares were not outstanding prior to the closing of the Reorganization and consequently have no performance history. However, the performance record of the Class Y shares would be modestly higher than the performance of the Class A and Class B shares due to the lower expenses applicable to Class Y shares.
(4) The Lehman Brothers Fixed Rate Mortgage-Backed Securities Index, an unmanaged index including 15- and 30-year fixed rate securities backed by mortgage pools of the Government National Mortgage Association ("GNMA"), Federal Home Loan Mortgage Corporation ("FHLMC") and Federal National Mortgage Association ("FNMA"). The Lehman Brother Fixed Rate Mortgage-Backed Securities Index is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Government Income Fund, the expenses of AmSouth Government Income Fund for the period ended January 31, 2005 and (ii) for Pioneer America Income Trust, the expenses of Pioneer America Income Trust for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004.
Shareholder transaction Pioneer fees (paid AmSouth America Combined AmSouth Pioneer Combined AmSouth Combined directly from Government Income Fund (Pro Government America Fund (Pro Government Fund (Pro your Income Fund(1) Trust Forma) Income Fund(1) Income Trust Forma) Income Fund(1) Forma) investment) Class A Class A Class A Class B Class B Class B Class I Class Y(8) -------------------------------------------------------------------------------------------------------------------------------- Maximum sales charge (load) when you buy shares as a percentage of offering price 4.00%(2) 4.50%(2) 4.50%(2) None None None None None -------------------------------------------------------------------------------------------------------------------------------- Maximum deferred sales charge (load) as a percentage of purchase price or the amount you receive when you sell shares, whichever is less None None None 5.00%(3) 4.00% 4.00% None None -------------------------------------------------------------------------------------------------------------------------------- Redemption fees 2.00%(4) None None 2.00%(4) None None 2.00%(4) None -------------------------------------------------------------------------------------------------------------------------------- Annual fund operating expenses (deducted from fund assets) (as a % of average net assets) -------------------------------------------------------------------------------------------------------------------------------- Management fee 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% -------------------------------------------------------------------------------------------------------------------------------- Distribution and service (12b-1) fee None 0.25% 0.25% 0.75% 1.00% 1.00% None None -------------------------------------------------------------------------------------------------------------------------------- Other expenses 0.75%(5) 0.41% 0.37% 0.80%(5) 0.48% 0.42% 0.58%(5) 0.10% -------------------------------------------------------------------------------------------------------------------------------- Total fund operating expenses 1.25% 1.16%(6) 1.12% 2.05% 1.76%(6) 1.92% 1.08% 0.60% -------------------------------------------------------------------------------------------------------------------------------- Expense reimbursement/ reduction 0.24% N/A(7) N/A 0.29% N/A(7) N/A 0.22% N/A -------------------------------------------------------------------------------------------------------------------------------- Net fund operating expenses 1.01% 1.16% 1.12% 1.76% 1.98% 1.92% 0.86% 0.60% -------------------------------------------------------------------------------------------------------------------------------- |
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%,
3%, 3%, 2%, 1%. Approximately eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5) Other expenses for your AmSouth Fund are being limited to 0.51% for Class A shares, 0.51% for Class B shares and 0.36% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(7) The expenses in the table above reflect the expense limitations currently in effect for the Pioneer Fund, under which Pioneer has contractually agreed to limit ordinary operating expenses to the extent required to reduce Fund expenses to 1.30%, and 2.20% of the average daily net assets attributable to Class A and Class B shares, respectively. These expense limitations are in effect through April 1, 2008 for Class A shares and through April 1, 2006 for Class B shares. There can be no assurance that Pioneer will extend the expense limitations beyond such time.
(8) Class Y shares of Pioneer America Income Trust will be offered for the first time in connection with the closing of the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, (d) each Fund's gross operating expenses remain the same, and (e) the expense limitation for your Fund is in effect for year one. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Number of years you AmSouth Government Income Pioneer America Income Combined Fund
own your shares Fund Trust (Pro Forma)
----------------------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------------------
Year 1 $ 522 $ 700 $ 682
----------------------------------------------------------------------------------------
Year 3 $ 781 $ 963 $ 909
----------------------------------------------------------------------------------------
Year 5 $ 1,059 $ 1,485 $ 1,155
----------------------------------------------------------------------------------------
Year 10 $ 1,851 $ 2,913 $ 1,856
----------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
----------------------------------------------------------------------------------------
Year 1 $ 708 $ 623 $ 595
----------------------------------------------------------------------------------------
Year 3 $ 943 $ 1,140 $ 902
----------------------------------------------------------------------------------------
Year 5 $ 1,303 $ 1,583 $ 1,036
----------------------------------------------------------------------------------------
Year 10 $ 2,174 $ 3,086 $ 2,033
----------------------------------------------------------------------------------------
Class B -- assuming no redemption
----------------------------------------------------------------------------------------
Year 1 $ 208 $ 223 $ 197
----------------------------------------------------------------------------------------
Year 3 $ 643 $ 840 $ 611
----------------------------------------------------------------------------------------
Year 5 $ 1,103 $ 1,483 $ 1,050
----------------------------------------------------------------------------------------
Year 10 $ 2,174 $ 3,086 $ 2,059
----------------------------------------------------------------------------------------
Class I Class Y
----------------------------------------------------------------------------------------
Year 1 $ 110 N/A $ 61
-----------------------------------------------------------------------------------------
Year 3 $ 343 N/A $ 191
----------------------------------------------------------------------------------------
Year 5 $ 595 N/A $ 332
----------------------------------------------------------------------------------------
Year 10 $ 1,317 N/A $ 745
----------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Government Income Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to you AmSouth Fund, and AmSouth Bank informed the Trustees that they did not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the historical investment performance of Pioneer America Income Trust is comparable to your AmSouth Fund's investment performance. For the one, five and ten year periods ended December 31, 2004, Class A shares of Pioneer America Income Trust had an average annual return of -1.86% (one year); 5.26% (five year); and 5.75% (ten year), compared to an average annual return of the Class A shares of your AmSouth Fund of -1.72% (one year); 5.12% (five year); and 6.06% (ten year), respectively, during the same period. The Trustees also considered performance information provided for the one, three, and five year periods ended March 31, 2005 during which Class A shares of Pioneer America Income Trust had an average annual return of 0.79% (one year); 4.42% (three year); and 5.57% (five year) compared to an average annual return of the Class A shares of your AmSouth Fund of 0.02% (one year); 3.99% (three year); and 5.40% (five year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Third, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges. In addition, Pioneer offers shareholders additional options for their accounts, including the ability to transact and exchange shares over the telephone or online and the ability to access account values and transaction history in all of the shareholder's direct accounts in the Pioneer Funds over the telephone or online.
Fourth, Pioneer America Income Trust's management fee (0.50% of average daily net assets) is the same as the advisory fee of your Fund (0.50% of average daily net assets). In addition, the Trustees considered that the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduce per share expenses. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. Currently, for each class of shares, your Fund's gross expenses are higher than the corresponding class of the Pioneer Fund. However, net of expense limitations, the expenses attributable to Class Y shares of the Pioneer Fund are lower than your Fund's net expenses attributable to Class I shares and the net expenses of the Pioneer Fund attributable to Class A and Class B shares are higher than the net expenses of the corresponding classes of the AmSouth Fund. On a pro forma basis, after giving effect to the Reorganization, it is estimated that the gross expenses of each class of the Pioneer America Income Trust will be lower than the gross expenses of the corresponding class of your Fund. It is also estimated that the expenses of the Pioneer America Income Trust's Class Y shares net of expense limitations will be lower than the net expenses of your Fund's Class I shares but that the net expenses of the Pioneer America Income Trust's Class A shares and Class B shares will be higher. The lower net expenses are a result of expense limitations on your AmSouth Fund that are voluntary and may be discontinued at any time. AAMI has informed the trustees that the expense limitations will be discontinued in the future. The trustees considered the positive factors associated with the Reorganization, such as greater fund assets and potential for growth, to outweigh the negative factors, such as the increase in expenses.
Fifth, the Class A, B and Y shares of Pioneer America Income Trust received in the Reorganization will provide AmSouth Government Income Fund shareholders with exposure to substantially the same investment product as they currently have.
Sixth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and
expenses of your Fund in connection with the Reorganization. The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
AmSouth Pro Forma
Government Pioneer America Pioneer America
Income Fund Income Trust Income Trust
May 31, 2005 May 31, 2005 May 31, 2005
------------ --------------- ---------------
Total Net Assets (in thousands) ...... $ 163,519 $ 233,045 $ 396,564
Class A shares .................... $ 20,039 $ 119,737 $ 139,776
Class B shares .................... $ 6,222 $ 38,742 $ 44,964
Class I/Y shares .................. $ 137,258 N/A $ 137,258
Net Asset Value Per Share
Class A shares .................... $ 9.74 $ 9.77 $ 9.77
Class B shares .................... $ 9.74 $ 9.71 $ 9.71
Class I/Y shares .................. $ 9.75 N/A $ 9.77
Shares Outstanding
Class A shares .................... 2,056,612 12,255,588 14,306,610
Class B shares .................... 638,777 3,988,717 4,629,298
Class I/Y shares .................. 14,080,389 N/A 14,080,389
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Limited Term Bond Fund and Pioneer Short Term Income Fund
PROPOSAL 1(s)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund has an investment objective of preservation of principal and invests primarily in short-term debt instruments and, consequently, the Funds have similar investment policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Limited Term Bond Fund to Pioneer Short Term Income Fund
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified open-end management investment
open-end management investment company company organized as a Delaware statutory
organized as a Massachusetts business trust. trust.
Net assets as of March 31, $ 186.4 million $25.5 million
2005
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Managers: Portfolio Manager:
Day-to-day management of AmSouth Limiter Term Day-to-day management of the Fund's portfolio
Bond Fund's portfolio is the responsibility of is the responsibility of a team of fixed
John P. Boston, CFA and Michael T. Lytle, CFA. income portfolio managers led by Kenneth J.
Mr. Boston and Mr. Lytle were each named Taubes. The team manages other Pioneer mutual
co-manager of the Fund in 2004. Mr. Boston funds investing primarily in fixed income
managed the Fund from 1993 to 1998 and securities. Mr. Taubes is responsible for
co-managed the Fund from 1999 to 2002. He overseeing the U.S. and global fixed income
also manages the AmSouth High Quality Bond team. He joined Pioneer as a senior vice
Fund and the AmSouth Government Income Fund president in September 1998 and has been an
and co-manages the AmSouth Balanced Fund. Mr. investment professional since 1982. The team
Boston is Chief Fixed Income Officer for may draw upon the research and investment
AAMI. Mr. Boston began his career in management expertise of the global research
investment management with AmSouth Bank in team, which provides fundamental research on
1988 and has been associated with AAMI since companies and includes members from Pioneer's
1996. Mr. Lytle joined AmSouth Bank's Asset affiliate, Pioneer Investment Management
Management Group in 1999 and AAMI in 2003. He Limited.
is a fixed-income portfolio manager for AAMI,
specializing in taxable fixed-income
securities.
Investment objective AmSouth Limited Term Bond Fund seeks to Pioneer Short Term Income Fund seeks a high
provide investors with current income level of current income to the extent
consistent with the preservation of capital. consistent with a relatively high level of
stability of principal.
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
Primary investments The Fund invests primarily in short-term fixed Pioneer Short Term Income Fund invests
income securities with maturities of five primarily in:
years or less, principally corporate bonds and
securities issued or guaranteed by the U.S. o Debt securities issued or guaranteed by
government, its agencies or instrumentalities. the U.S. government, its agencies or
Under normal circumstances, the Fund will instrumentalities
invest at least 80% of its net assets in bonds.
For the purpose of this policy, net assets o Debt securities, including convertible
include net assets plus borrowings for debt, of U.S. and non-U.S. issuers and
investment purposes. The Fund will invest commercial paper
at least 65% of its total assets in bonds
(including debentures), notes and other debt o Mortgage-backed and asset-backed
securities which have a stated or remaining securities of U.S. and non-U.S. issuers
maturity of five years or less or which have
an unconditional redemption feature that will o Short-term money market instruments of
permit the Fund to require the issuer of the U.S. and non-U.S. issuers
security to redeem the security within five
years from the date of purchase by the Fund or Normally, at least 80% of Pioneer Short Term
for which the Fund has acquired an Income Fund's net assets are invested in debt
unconditional "put" to sell the security securities that are rated investment grade at
within five years from the date of purchase by the time of purchase or cash and cash
the Fund. The Fund invests in securities equivalents. Cash and cash equivalents are
issued by the Government National Mortgage cash balances, accrued interest and receivables.
Association, which are supported by the full Pioneer Short Term Income Fund will normally
faith and credit of the U.S. government, and maintain a dollar-weighted average portfolio
securities issued by the Federal National maturity of no more than 3 years.
Mortgage Association, the Federal Home Loan
Mortgage Corporation and the Federal Home Loan A debt security is investment grade if it is
Banks, which are supported by the right of the rated in one of the top four categories by at
issuer to borrow from the U.S. Treasury. The least one NRSRO or Pioneer determines that the
Fund also invests in debt securities only if security is of equivalent credit quality.
they are high grade (rated at the time of Debt securities rated below investment grade
purchase in one of the four highest rating are commonly referred to as "junk bonds" and
categories by a nationally recognized are considered speculative. Lower quality
statistical rating organization ("NRSRO"), or debt securities involve greater risk of loss,
are determined by AAMI to be of comparable are subject to greater price volatility and
quality). are less liquid, especially during periods of
economic uncertainty or change, than high
quality debt securities. Pioneer Short Term
If the Fund acquires a debt security with a Income Fund's investments may have fixed or
stated or remaining maturity in excess of five variable principal payments and all types of
years, the Fund may acquire a "put" with interest rate payment and reset terms,
respect to the security. Under a "put," the including fixed rate, adjustable rate, zero
Fund would have the right to sell the debt coupon, contingent, deferred, payment in kind
security within a specified period of time at and auction rate features.
a specified minimum price. The Fund will only
acquire puts from dealers, banks and Pioneer Short Term Income Fund may invest in
broker-dealers which AAMI has determined are mortgage-backed and asset-backed securities.
creditworthy. A put will be sold, Mortgage related securities may be issued by
transferred, or assigned by the Fund only with private companies or by agencies of the U.S.
the underlying debt security. The Fund will government and represent direct or indirect
acquire puts solely to shorten the maturity of participation in, or are collateralized by and
the underlying debt security. payable from, mortgage loans secured by real
property. Asset-backed securities represent
participations in, or are secured by and
payable from, financial assets such as
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
installment sales or loan contracts, leases,
credit card receivables and other categories
of receivables. Certain asset-backed
securities present a heightened level of risk
because, in the event of default, the
liquidation value of the underlying assets may
be inadequate or nonexistent to pay any unpaid
principal or interest. Certain debt
instruments may only pay principal at maturity
or may only represent the right to receive
payments of principal or payments of interest
on underlying pools of mortgage or government
securities, but not both. The value of these
types of instruments may change more
drastically than debt securities that pay both
principal and interest during periods of
changing interest rates. Principal only
mortgage-backed securities generally increase
in value if interest rates decline, but are
also subject to the risk of prepayment.
Interest only instruments generally increase
in value in a rising interest rate environment
when fewer of the underlying mortgages are
prepaid, but remain subject to prepayment
risk, which would be a loss of any expected
interest payments, even though there is no
default on the underlying financial asset.
For mortgage derivatives and structured
securities that have imbedded leverage
features, small changes in interest or
prepayment rates may cause large and sudden
price movements. Mortgage derivatives can
also become illiquid and hard to value in
declining markets.
Investment strategies AAMI's fixed income portfolio management Pioneer considers both broad economic and
process focuses on the four key areas of issuer specific factors in selecting a
duration management, sector weights, position portfolio designed to achieve the Fund's
on the yield curve and security selection; investment objective. In assessing the
AAMI's goal is to add value in each of these appropriate maturity, rating and sector
four areas through the active management of weighting of the Fund's portfolio, Pioneer
the Fund's portfolio. Beginning with rigorous considers a variety of broad economic factors
fundamental analysis of the economy and taking that are expected to influence economic
into account characteristics of the current activity and interest rates. These factors
business and interest rate cycles, AAMI include fundamental economic indicators,
arrives at a projection of the likely trend in Federal Reserve monetary policy and the
interest rates and adjusts duration relative value of the U.S. dollar compared to
accordingly. Analysis of the shape of the other currencies. Once Pioneer determines the
yield curve and yield spreads among bond preferable portfolio characteristic, Pioneer
market sectors leads to further refinements in selects individual securities based upon the
strategy. terms of the securities (such as yields
compared to U.S. Treasuries or comparable
issuers), liquidity and rating, sector and
issuer diversification. Pioneer also employs
due diligence and fundamental research, an
evaluation of the issuer based on its
financial statements and
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
operations, to assess an issuer's credit
quality, taking into account financial condition
and profitability, future capital needs,
potential for change in rating, industry
outlook, the competitive environment and
management ability. In making these portfolio
decisions, Pioneer relies on the knowledge,
experience and judgment of its staff who have
access to a wide variety of research.
Other investments The remainder of the Fund's assets may be Up to 10% of Pioneer Short Term Income Fund's
invested in bonds (including debentures), net assets may be below investment grade.
notes and other debt securities which have a
stated or remaining maturity of greater than Pioneer Short Term Income Fund may invest up
five years, cash, cash equivalents, and money to 20% of its total assets in securities of
market instruments. The Fund may invest up to non-U.S. issuers. Up to 5% of Pioneer Short
20% of its total assets in cash, cash Term Income Fund's total assets may be
equivalents and corporate bonds with remaining invested in debt securities of emerging market
maturities of less than 1 year. issuers. Non-U.S. securities may be issued by
non-U.S. governments, banks or corporations
and certain supranational organizations, such
as the World Bank and the European Union.
Pioneer Short Term Income Fund may invest in
securities of Canadian issuers to the same
extent as securities of U.S. issuers.
Investing in Canadian and other non-U.S.
issuers, particularly issuers in emerging
markets, may involve unique risks compared to
investing in the securities of U.S. issuers.
If a rating organization downgrades the
quality rating assigned to one or more of the
Fund's portfolio securities, Pioneer will
consider what actions, if any, are appropriate
including selling the downgraded security or
purchasing additional investment grade
securities as soon as it is prudent to do so.
Temporary defensive When AAMI determines adverse market conditions Pioneer Short Term Income Fund may invest all
strategies exist, AmSouth Limited Term Bond Fund may or part of its assets in securities with
invest entirely in cash positions, directly in remaining maturities of less than one year,
U.S. Government securities and short-term cash equivalents or may hold cash.
paper, such as bankers' acceptances.
Diversification Each Fund is diversified and is subject to diversification requirements under the Internal
Revenue Code of 1986 for the purpose of the Investment Company Act, as amended (the "Code").
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Limited Term Bond Fund may not Pioneer Short Term Income Fund may not invest
purchase any securities which would cause more more than 25% of its assets in any one
than 25% of the value of the Fund's total industry.
assets at the time of purchase to be invested
in securities of one or more issuers
conducting their principal business activities
in the same industry, provided that (a) there
is no limitation with respect to obligations
issued or guaranteed by the U.S. government or
its agencies or instrumentalities, and
repurchase agreements secured by obligations
of the U.S. government or its agencies or
instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their
activities are primarily related to financing
the activities of their parents; and (c)
utilities will be divided according to their
services. For example, gas, gas transmission,
electric and gas, electric, and telephone will
each be considered a separate industry.
There is no limitation with respect to
municipal securities, which, for purposes of
this limitation only, do not include private
activity bonds that are backed only by the
assets and revenues of a non-governmental user.
Restricted and illiquid AmSouth Limited Term Bond Fund may not invest Pioneer Short Term Income Fund may not invest
securities more than 15% of its net assets in securities more than 15% of its net assets in securities
that are restricted as to resale, or for which that are illiquid and other securities that
no readily available market exists, including are not readily marketable. Repurchase
repurchase agreements providing for settlement agreements maturing in more than seven days
more than seven days after notice. will be included for purposes of the foregoing
limit.
Borrowing AmSouth Limited Term Bond Fund may not borrow Pioneer Short Term Income Fund may not borrow
money or issue senior securities, except that money, except on a temporary basis and to the
the Fund may borrow from banks or enter into extent permitted by applicable law, the Fund
reverse repurchase agreements for temporary may: (a) borrow from banks or through reverse
emergency purposes in amounts up to 33 1/3% of repurchase agreements in an amount up to 33
the value of its total assets at the time of 1/3% of the Fund's total assets (including the
such borrowing. AmSouth Limited Term Bond amount borrowed); (b) borrow up to an
Fund will not purchase securities while additional 5% of the Fund's assets for
borrowings (including reverse repurchase temporary purposes; (c) obtain such short-term
agreements) in excess of 5% of its total credits as are necessary for the clearance of
assets are outstanding. In addition, AmSouth portfolio transactions; (d) purchase
Limited Term Bond Fund is permitted to securities on margin; and (e) engage in
participate in a credit facility whereby the transactions in mortgage dollar rolls that are
Fund may directly lend to and borrow money accounted for as financings.
from another AmSouth Fund for temporary
purposes, provided that the loans are made in
accordance with an order of exemption from the
SEC and any conditions thereto.
Lending AmSouth Limited Term Bond Fund may not Pioneer Short Term Income Fund may not
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
make loans, except that it may purchase or hold make loans, except that the Fund may (i) lend
debt instruments in accordance with its portfolio securities in accordance with the
investment objective and policies, lend Fund Fund's investment policies, (ii) enter into
securities in accordance with its investment repurchase agreements, (iii) purchase all or a
objective and policies and enter into portion of an issue of publicly distributed
repurchase agreements. In addition, AmSouth debt securities, bank loan participation
Limited Term Bond Fund is permitted to interests, bank certificates of deposit,
participate in a credit facility whereby the bankers' acceptances, debentures or other
it may directly lend to and borrow money from securities, whether or not the purchase is
other AmSouth Funds for temporary purposes, made upon the original issuance of the
provided that the loans are made in accordance securities, (iv) participate in a credit
with an order of exemption from the SEC and facility whereby the Fund may directly lend to
any conditions thereto. and borrow money from other affiliated funds
to the extent permitted under the Investment
Company Act or an exemption therefrom, and (v)
make loans in any other manner consistent with
applicable law, as amended and interpreted or
modified from time to time by any regulatory
authority having jurisdiction.
Derivative instruments AmSouth Limited Term Bond Fund may invest in Pioneer Short Term Income Fund may use futures
futures contracts and options thereon and options on securities, indices and
(interest rate futures contracts or index currencies, forward currency exchange
futures contracts, as applicable) to commit contracts and other derivatives. The Fund
funds awaiting investment, to maintain cash does not use derivatives as a primary
liquidity or for other hedging purposes. The investment technique and generally limits
value of the Fund's contracts may equal or their use to hedging. However, the Fund may
exceed 100% of the Fund's total assets, use derivatives for a variety of non-principal
although the Fund will not purchase or sell a purposes, including:
futures contract unless immediately afterwards
the aggregate amount of margin deposits on its o As a hedge against adverse changes in
existing futures positions plus the amount of stock market prices, interest rates or
premiums paid for related futures options currency exchange rates
entered into for other than bona fide hedging
purposes is 5% or less of its net assets. o As a substitute for purchasing or selling
securities
o To increase the Fund's return as a
non-hedging strategy that may be
considered speculative
Short-term trading AmSouth Limited Term Bond Fund may engage in Pioneer Short Term Income Fund does not
the technique of short-term trading. Such usually trade for short-term profits. The
trading involves the selling of securities Fund will sell an investment, however, even if
held for a short-time, ranging from several it has only been held for a short time, if it
months to less than a day. The object of such no longer meets the Fund's investment criteria.
short-term trading is to increase the
potential for capital appreciation and/or
income of the Fund in order to take advantage
of what AAMI believes are changes in market,
industry or individual company outlook.
Other investment policies As described above, the Funds have substantially similar principal investment strategies and
and restrictions policies. Certain of the non-principal investment policies and restrictions are different.
For a more complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
--------------------------------------------------------------------------------------------------------------------------------
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered with an initial Class A shares are offered with an initial
Rule 12b-1 fees sales charge of up to 4.00% of the offering sales charge of up to 2.50% of the offering
price, which is reduced depending upon the price, which is reduced or waived for large
amount invested or, in certain circumstances, purchases and certain types of investors. At
waived. Class A shares bought as part of an the time of your purchase, your investment
investment of $1 million or more are not firm may receive a commission from Pioneer
subject to an initial sales charge, but may be Funds Distributor, Inc. ("PFD"), the Fund's
charged a contingent deferred sales charge distributor, of up to 2% declining as the size
("CDSC") of 1.00% if sold within one year of of your investment increases.
purchase.
There is no CDSC, except in certain
Class A shares pay a shareholder servicing fee circumstances when the initial sales charge is
(non 12b-1) of up to 0.25% of average daily waived.
net assets.
Class A shares are subject to distribution and
service (12b-1) fees of up to 0.25% of average
daily net assets.
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 2% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held three years. Your investment firm may receive
continuously declines over six years, starting a commission from PFD, the Fund's distributor,
with year one and ending in year seven from: at the time of your purchase of up to 2%.
4%, 3%, 3%, 2%, 2%, 1%. For all other Class B
shares held continuously, the CDSC declines Class B shares are subject to distribution and
over six years, starting with year one and service (12b-1) fees of up to 1% of average
ending in year seven from: 5%, 4%, 3%, 3%, 2%, daily net assets.
1%. Eight years after purchase (seven years
in the case of shares acquired in the ISG Class B shares acquired through the
combination), Class B shares automatically Reorganization will be subject to the CDSC and
convert to Class A shares. commission schedules applicable to the
original purchase.
Class B shares pay a shareholder servicing fee
(non 12b-1) of up to 0.25% of average daily Maximum purchase of Class B shares in a single
net assets and a distribution (12b-1) fee of transaction is $49,999.
0.75% of up to average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
Class I and Class Y sales AmSouth Limited Term Bond Fund does not impose The Fund does not impose any initial,
charges and Rule 12b-1 fees any initial sales charge or a CDSC on Class I contingent deferred or asset based sales
shares. charge on Class Y shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average distributing the Fund's Class Y shares, none
daily net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth Limited Term Bond Fund pays an Pioneer Short Term Income Fund pays Pioneer an
advisory fee on a monthly basis at an annual annual fee equal to 0.40% of the Fund's
rate of 0.50% of the Fund's average daily net average daily net assets.
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
assets. Fund's average daily net assets.
ASO Services Company, Inc. ("ASO") serves as In addition, the Fund reimburses Pioneer for
administrator and fund accounting agent for certain fund accounting and legal expenses
the Fund. The Fund pays ASO an administrative incurred on behalf of the Fund and pays a
services fee of 0.15% of the Fund's average separate shareholder servicing/transfer agency
daily net assets. Other expenses of the Fund fee to PIMSS, an affiliate of Pioneer.
are being limited to 0.48% for Class A shares,
0.48% for Class B shares and 0.33% for Class I Through December 31, 2005, Pioneer has
shares. Any fee waiver or expense contractually agreed to limit ordinary
reimbursement arrangement is voluntary and may operating expenses to the extent required to
be discontinued at any time. reduce Fund expenses to 0.90% of the average
daily net assets attributable to Class A
For the fiscal year ended July 31, 2004, the shares. The portion of Fund expenses
Fund's annual operating expenses for Class A (including the amount of management fee
shares, after giving effect to the expense waived) attributable to Class B shares and
limitation were 0.98%, and without giving Class Y shares will be reduced only to the
effect to the expense limitation, were 1.00% extent such expenses are reduced for Class A
of average daily net assets. shares. Any differences in the fee waiver and
expense limitation among classes result from
For the fiscal year ended July 31, 2004, the rounding in the daily calculation of a class'
Fund's annual operating expenses for Class B net assets and expense limitation, which may
shares, after giving effect to the expense exceed 0.01% annually. There can be no
limitation were 1.73%, and without giving assurance that Pioneer will extend the expense
effect to the expense limitation, were 1.75% limitation beyond December 31, 2005.
of average daily net assets.
For the fiscal year ended August 31, 2004, the
For the fiscal year ended July 31, 2004, the Fund's total annual operating expenses for
Fund's annual operating expenses for Class I Class A shares, after giving effect to the
shares, after giving effect to the expense expense limitation, were 0.90%, and without
limitation were 0.83%, and without giving giving effect to the expense limitation were
effect to the expense limitation, were 0.90% 9.40% of average daily net assets.
of average daily net assets.
For the fiscal year ended August 31, 2004, the
Fund's total annual operating expenses for
Class B shares, after giving effect to the
expense limitation, were 1.89%, and without
giving effect to the expense limitation were
10.65% of average daily net assets.
For the fiscal year ended August 31, 2004, the
Fund's total annual operating expenses for
Class Y shares were 0.61%, and without giving
effect to the expense limitation were 10.54%
of average daily net assets.
Buying shares You may buy shares of the Fund directly You may buy shares from any investment firm
through BISYS Fund Services, the Fund's that has a sales agreement with PFD, the
distributor, or through brokers, registered Fund's distributor.
investment advisers, banks and other financial
institutions that have entered into selling If the account is established in the
agreements with the Fund's distributor, as shareholder's own name, shareholders may also
described in the Fund's prospectus. purchase additional shares of the Fund by
telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
|
AmSouth Limited Term Bond Fund Pioneer Short Term Income Fund
--------------------------------------------------------------------------------------------------------------------------------
shares of the same class of another AmSouth the same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. The Fund allows you to exchange your
requirements for the Fund into which you are shares at net asset value without charging you
exchanging. Exchanges from one Fund to either an initial or CDSC at the time of the
another are taxable. Class A shares may be exchange. Shares you acquire as part of an
exchanged for Class I shares of the same Fund exchange will continue to be subject to any
or another AmSouth Fund if you become eligible CDSC that applies to the shares you originally
to purchase Class I shares. Class I shares may purchased. When you ultimately sell your
be exchanged for Class A shares of the same shares, the date of your original purchase
Fund. No transaction fees are currently will determine your CDSC. An exchange
charged for exchanges. generally is treated as a sale and a new
purchase of shares for federal income tax
If you sell your shares or exchange them for purposes.
shares of another AmSouth Fund within 7 days
of the date of purchase, you will be charged a After you establish an eligible Fund account,
2.00% fee on the current net asset value of you can exchange Fund shares by telephone or
the shares sold or exchanged. The fee is paid online.
to the Fund to offset the costs associated
with short-term trading, such as portfolio
transaction and administrative costs.
The Fund uses a "first-in, first-out" method
to determine how long you have held your
shares. This means that if you purchased
shares on different days, the shares purchased
first will be considered redeemed first for
purposes of determining whether the redemption
fee will be charged.
The fee will be charged on all covered
redemptions and exchanges, including those
made through retirement plan, brokerage and
other types of omnibus accounts (except where
it is not practical for the plan administrator
or brokerage firm to implement the fee). The
Fund will not impose the redemption fee on a
redemption or exchange of shares purchased
upon the reinvestment of dividend and capital
gain distributions.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o The Fund's income declines due to a decrease in interest rates.
o The possibility that an issuer cannot make timely interest and principal payments on its debt securities. The lower a security's rating, generally the greater its credit risk.
o During periods of declining interest rates, the issuer of a security may exercise its option to prepay principal earlier than scheduled, forcing the Fund to reinvest in lower yielding securities. This is known as call or prepayment risk.
o During periods of rising interest rates, the average life of certain types of securities may be extended because of slower than expected principal payments. This may lock in a below market interest rate, increase the security's duration (the estimated period until the security is paid in full) and reduce the value of the security. This is known as extension risk. Risk is generally high for longer-term bonds and lower or for shorter-term bonds.
o The adviser's judgment about the attractiveness, relative value or potential appreciation of a particular sector, security or hedging strategy proves to be incorrect.
Certain securities issued by agencies and instrumentalities of the U.S. government in which each Fund may invest are backed by the full faith and credit of the U.S. government, but others are not insured or guaranteed by the U.S. government and may be supported only by the issuer's right to borrow from the U.S. Treasury, by the credit of the issuing agency, instrumentality or corporation, or by the U.S. in some other way. Likewise, government sponsored entities such as the Federal Home Loan Mortgage Corporation (Freddie Mac), FNMA and the FHLBs, although chartered or sponsored by Congress, are not funded by congressional appropriations and the debt and mortgage backed securities issued by them are neither guaranteed nor issued by the U.S. government.
To the extent that Pioneer Short Term Income Fund invests significantly in asset-backed and mortgage-related securities, its exposure to prepayment and extension risks may be greater than other investments in fixed income securities.
Pioneer Short Term Income Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Fund invests in issuers in countries with emerging markets or if the Fund invests significantly in one country. These risks may include:
o Less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices
o Many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the adviser/subadviser might not be able to sell the Fund's portfolio securities at times, in amounts and at prices it considers reasonable
o Adverse effect of currency exchange rates or controls on the value of the Fund's investments
o The economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession
o Economic, political and social developments may adversely affect the securities markets
o Withholding and other non-U.S. taxes may decrease the Fund's return
In addition, at times, more than 25% of Pioneer Short Term Income Fund's assets may be invested in the same market segment, such as financials or technology. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus.
Past Performance
Set forth below is performance information for your AmSouth Fund. The bar charts show how your AmSouth Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for your AmSouth Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results.
AmSouth Limited Term Bond Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 12.72 1996 3.69 1997 6.80 1998 7.13 1999 1.36 2000 8.22 2001 7.93 2002 6.49 2003 2.19 2004 0.60 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 4.02% for the quarter ended June 30, 1995, and the lowest quarterly return was -1.36% for the quarter ended June 30, 2004.
Pioneer Short Term Income Fund -- Class A Shares Calendar Year Total Returns
Since the Fund has conducted investment operations for less than one calendar year, it may not disclose any performance information in this prospectus. The Fund's performance will vary from year to year. Past performance does not necessarily indicate how a fund will perform in the future. As a shareowner, you may lose or make money on your investment.
AmSouth Limited Term Bond Fund Average Annual Total Returns (for the periods ending December 31, 2004)
1 Year 5 Years 10 Years
-----------------------------------------------------------------------------------------
AmSouth Limited Term Bond Fund, Class A Shares(1)
-----------------------------------------------------------------------------------------
Return Before Taxes(1) -1.44% 4.61% 5.44%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions -2.46% 2.90% 3.41%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares -0.94% 2.88% 3.38%
-----------------------------------------------------------------------------------------
AmSouth Limited Term Bond Fund, Class B Shares(2)
-----------------------------------------------------------------------------------------
Return Before Taxes -5.01% 3.92% 4.75%
-----------------------------------------------------------------------------------------
AmSouth Limited Term Bond Fund, Class I Shares(3)
-----------------------------------------------------------------------------------------
Return Before Taxes 0.84% 5.20% 5.76%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions -0.25% 3.43% 3.69%
-----------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of Fund Shares 0.54% 3.36% 3.63%
-----------------------------------------------------------------------------------------
|
1 Year 5 Years 10 Years
-----------------------------------------------------------------------------------------
Merrill Lynch 1-5 Year Government/Corporate Bond Index(4) 1.77% 6.12% 6.49%
(reflects no deduction for fees, expenses or taxes)
-----------------------------------------------------------------------------------------
|
(1) Class A shares were first offered on 2/1/89.
(2) Performance for the Class B shares, which were first offered on 1/21/99, is based on the historical performance of the Fund's Class A shares (without sales charge) prior to that date. The historical performance of the Class B shares has been restated to reflect the Fund's Class B shares distribution (12b-1) fees and the CDSC.
(3) Performance for the Class I shares, which were first offered on 9/2/97, is based on the historical performance of the Fund's Class A shares, including the performance of the predecessor fund and commingled accounts (without sales charge) prior to that date. The predecessor fund and commingled accounts were managed using substantially the same investment objective, policies and methodologies as the Fund.
(4) Merrill Lynch 1-5 Year Government/Corporate Bond Index, an unmanaged index representative of the total return of short-term government and corporate bonds, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The table above shows the impact of taxes on AmSouth Limited Term Bond Fund's returns. After-tax returns are only shown for Class A shares and Class I shares and may vary for Class B shares. The Fund's after-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. In certain cases, the figure representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that benefits the shareholder. Please note that actual after-tax returns depend on an investor's tax situation and may differ from those shown. Also note that after-tax returns shown are not relevant to shareholders who hold Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Limited Term Bond Fund, the expenses of AmSouth Limited Term Bond Fund for the period ended January 31, 2005 and (ii) for Pioneer Short Term Income Fund, the expenses of Pioneer Short Term Income Fund for the period ended February 28, 2005. Future expenses for all share classes may be greater or less. Shareholders of AmSouth Limited Term Bond Fund are also being asked to approve the reorganization of their Fund into Pioneer Short Term Income Fund. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on February 28, 2005.
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Short Combined AmSouth Pioneer Short Combined transaction Limited Short Fund Limited Term Term Income Fund (Pro Limited Term Term Income Fund (Pro fees (paid Term Term (Pro Bond Fund(1) Fund Forma) Bond Fund(1) Fund Forma) directly from Bond Income Forma) your Fund(1) Fund investment) Class A Class A Class A Class B Class B Class B Class I Class Y Class Y ----------------------------------------------------------------------------------------------------------------------------- Maximum sales 4.00%(2) 2.50%(2) 2.50%(2) None None None None None None charge (load) when you buy shares as a percentage of offering price |
Shareholder AmSouth Pioneer Combined AmSouth Pioneer Short Combined AmSouth Pioneer Short Combined transaction Limited Short Fund Limited Term Term Income Fund (Pro Limited Term Term Income Fund (Pro fees (paid Term Term (Pro Bond Fund(1) Fund Forma) Bond Fund(1) Fund Forma) directly from Bond Income Forma) your Fund(1) Fund investment) Class A Class A Class A Class B Class B Class B Class I Class Y Class Y ------------------------------------------------------------------------------------------------------------------------------- Maximum None None None 5.00%(3) 4.00% 4.00% None None None deferred sales charge (load) as a percentage of purchase price or the amount you receive when you sell shares, whichever is less Redemption 2.00%(4) None None 2.00%(4) None None 2.00%(4) None None fees Annual fund operating expenses (deducted from fund assets) (as a % of average net assets) Management fee 0.50% 0.40% 0.40% 0.50% 0.40% 0.40% 0.50% 0.40% 0.40% Distribution None 0.25% 0.25% 0.75% 1.00% 1.00% None None None and service (12b-1) fee Other expenses 0.69%(5) 8.75% 0.19% 0.70%(5) 9.25% 0.29% 0.56%(5) 10.14% 0.14% Total fund 1.19% 9.40% 0.84% 1.95% 10.65% 1.69% 1.06% 10.54% 0.54% operating expenses Expense 0.20% 8.50%(6) N/A 0.21% 8.76%(6) N/A 0.22% 9.93%(6) N/A reimbursement /reduction Net fund 0.99% 0.90% 0.84% 1.74% 1.89% 1.69% 0.84% 0.61% 0.54% operating expenses |
(1.) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2.) Sales charges may be reduced depending upon the amount invested or, in certain circumstances, waived. Class A shares of the Pioneer Fund bought as part of an investment of $1 million or more are not subject to an initial sales charge, but may be charged a CDSC of 1.00% if sold within one year of purchase.
(3.) For Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(4.) To discourage short-term trading, a redemption fee of 2.00% will be charged on sales or exchanges of Class A, Class B and Class I shares of your AmSouth Fund made within 7 days of the date of purchase. A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(5.) Other expenses for your AmSouth Fund are being limited to 0.49% for Class A shares, 0.49% for Class B shares and 0.34% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6.) The expenses in the table above reflect the expense limitation in effect through December 31, 2005 under which Pioneer has contractually agreed not to impose all or a portion of its management fee and, if necessary, to limit other ordinary operating expenses to the extent required to reduce Class A expenses to 0.90% of the average daily net assets attributable to Class A shares. The portion of Fund expenses (including the amount of management fee waived) attributable to Class B and Class Y shares will be reduced only to the extent such expenses are reduced for Class A shares. Any differences in the fee waiver and expense limitation among classes result from rounding in the daily calculation of a class' net assets and expense limitation, which may exceed 0.01% annually. There can be no assurance that Pioneer will extend the expense limitation beyond December 31, 2005.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's gross operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Number of years you AmSouth Limited Term Bond Pioneer Short Term Income Combined Fund
own your shares Fund Fund (Pro Forma)
------------------------------------------------------------------------------------------------
Class A
------------------------------------------------------------------------------------------------
Year 1 $ 319 $ 340 $ 656
------------------------------------------------------------------------------------------------
Year 3 $ 570 $ 2,165 $ 828
------------------------------------------------------------------------------------------------
Year 5 $ 841 N/A $1,014
------------------------------------------------------------------------------------------------
Year 10 $ 1,614 N/A $1,553
------------------------------------------------------------------------------------------------
Class B --- assuming redemption at end of period
------------------------------------------------------------------------------------------------
Year 1 $ 698 $ 623 $ 572
------------------------------------------------------------------------------------------------
Year 3 $ 912 $ 1,140 $ 833
------------------------------------------------------------------------------------------------
Year 5 $ 1,252 N/A $1,018
------------------------------------------------------------------------------------------------
Year 10 $ 2,078 N/A $1,772
------------------------------------------------------------------------------------------------
Class B --- assuming no redemption
------------------------------------------------------------------------------------------------
Year 1 $ 198 $ 223 $ 172
------------------------------------------------------------------------------------------------
Year 3 $ 612 $ 840 $ 533
------------------------------------------------------------------------------------------------
Year 5 $ 1,052 N/A $ 918
------------------------------------------------------------------------------------------------
Year 10 $ 2,078 N/A $1,772
------------------------------------------------------------------------------------------------
Class I Class Y
------------------------------------------------------------------------------------------------
Year 1 $ 108 $ 62 $ 55
------------------------------------------------------------------------------------------------
Year 3 $ 337 $ 2,143 $ 173
------------------------------------------------------------------------------------------------
Year 5 $ 585 N/A $ 302
------------------------------------------------------------------------------------------------
Year 10 $ 1,294 N/A $ 677
------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Limited Term Bond Fund and its shareholders. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets, including $15.7 billion in fixed income securities. Pioneer is part of the
global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Third, Pioneer Short Term Income Fund's management fee (0.40% of average daily net assets) is lower than the advisory fee of your AmSouth Fund (0.50% of average daily net assets). The distribution and shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. While Pioneer Short Term Income Fund's gross and net expenses are higher than the historical gross and net expenses of your AmSouth Fund, (with the exception of the Pioneer Fund's Class Y shares) on a pro forma basis, after giving effect to the Reorganization, the gross and net expenses of each class of the Pioneer Fund are estimated to be lower than gross and net expenses of the corresponding class of your Fund. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduce per share expenses.
Fourth, the Class A, B and Y shares of Pioneer Short Term Income Fund received in the Reorganization will provide AmSouth Limited Term Bond Fund shareholders with exposure to substantially the same investment product as they currently have.
Fifth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the AmSouth Funds' proxy statements and solicitation costs incurred by the AmSouth Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Funds in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
Pro Forma
AmSouth Limited Pioneer Short Pioneer Short
Term Bond Fund Term Income Term Income
Fund Fund Fund
May 31, 2005 May 31, 2005 May 31, 2005
--------------- ------------- -------------
Total Net Assets (in thousands) $ 177,464 $ 31,013 $ 208,476
Class A shares ................................... $ 22,496 $ 10,781 $ 33,277
Class B shares ................................... $ 15,222 $ 3,262 $ 18,484
Class I/Y shares ................................. $ 139,746 $ 11,951 $ 151,696
Net Asset Value Per Share
Class A shares ................................... $ 10.29 $ 9.87 $ 9.87
Class B shares ................................... $ 10.28 $ 9.87 $ 9.87
Class I/Y shares ................................. $ 10.30 $ 9.88 $ 9.88
Shares Outstanding
Class A shares ................................... 2,185,785 $ 1,092,201 $ 3,371,288
|
Class B shares ................................... 1,481,111 $ 330,473 $ 1,872,521 Class I/Y shares ................................. 13,570,388 $ 1,210,036 $ 15,359,633 |
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Treasury Reserve Money Market Fund and Pioneer Cash Reserves Fund
PROPOSAL 1(t)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
The principal difference in the investment policies and risks of the Funds is that AmSouth Treasury Reserve Money Market Fund invests primarily in U.S. Treasury securities and related repurchase agreements, while Pioneer Cash Reserves Fund invests in a broader range of high quality short-term instruments. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Treasury Reserve Money Market Fund to Pioneer Cash Reserves Fund
AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified series of Pioneer Money Market
open-end management investment company Trust, an open-end management investment
organized as a Massachusetts business trust. company organized as a Delaware statutory
trust.
Net assets as of March 31, $180.1 million $513.9 million
2005
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Portfolio Manager:
Day-to-day management of AmSouth Treasury Day-to-day management of the Fund's portfolio
Reserve Money Market Fund's portfolio is the is the responsibility of Andrew Feltus. Mr.
responsibility of a team of AAMI's portfolio Feltus, a vice president, joined Pioneer in
managers, and no person is primarily 1994.
responsible for making recommendations to the
team.
Investment objective AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund seeks high current
seeks to provide investors with as high a income, preservation of capital and liquidity.
level of current income as is consistent with
the preservation of capital and the
maintenance of liquidity.
Primary investments As a fundamental policy, AmSouth Treasury Pioneer Cash Reserves Fund invests in U.S.
Reserve Money Market Fund will invest at least government obligations and money market
65% of its total assets in securities issued securities rated in one of the two highest
by the U.S. Treasury and repurchase agreements rating categories for short-term debt by a
in respect thereof. nationally recognized statistical rating
organization or, if unrated, determined to be
Under normal circumstances, AmSouth Treasury of equivalent credit quality by Pioneer. If
Reserve Money Market Fund invests at least 80% rating organizations differ in the rating
of its assets in U.S. Treasury assigned to a security, the Fund will only treat
|
AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
securities and related repurchase agreements. the security as having the higher rating
The remainder of its assets may be invested if at least two rating organizations assigned
in other securities guaranteed as to payment that rating. If a rating organization
of principal and interest by the U.S. downgrades the quality rating assigned to one
government and related repurchase agreements. or more of the Fund's portfolio securities,
Pioneer will promptly reassess whether the
downgraded security presents minimal credit
risk to the Fund.
Investment strategies AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund seeks to maintain a
invests based on considerations of safety of constant net asset value of $1.00 per share by
principal and liquidity, which means that the investing in high-quality, U.S. dollar
Fund may not necessarily invest in securities denominated money market securities, including
paying the highest available yield at a those issued by U.S. and foreign banks, U.S.
particular time. The Fund attempts to and foreign corporate issuers, the U.S.
increase its yield by trading to seek to take government and its agencies and
advantage of short-term market variations. instrumentalities, foreign governments, and
AAMI generally evaluates investments based on multinational organizations such as the World
interest rate sensitivity. The Fund will Bank.
maintain an average weighted portfolio
maturity of 90 days or less and will limit the The Fund invests exclusively in securities
maturity of each security in its portfolio to with a maximum remaining maturity of 397 days
397 days or less. and maintains a dollar-weighted average
portfolio maturity of 90 days or less. The
The interest income from the Fund's investment Fund's investments may have fixed, floating or
in direct obligations of the United States is variable interest rates.
exempt from state and local, but not federal,
income taxes. Dividends attributable to In selecting the Fund's portfolio, Pioneer
income from repurchase agreements are subject complies with the rating, maturity and
to federal, state and local income taxes. diversification requirements applicable to
money market funds. Within those limits,
The Fund will not invest in securities issued Pioneer's assessment of broad economic factors
or guaranteed by U.S. government agencies, that are expected to affect economic activity
instrumentalities or government-sponsored and interest rates influence its securities
enterprises that are not backed by the full selection. Pioneer also employs due diligence
faith and credit of the United States. and fundamental research, an evaluation of the
issuer based on its financial statements and
operations, to assess an issuer's credit
quality.
Other investments The Fund may enter into reverse repurchase Pioneer Cash Reserves Fund may invest more
agreements with banks, brokers or dealers. than 25% of its total assets in U.S.
The Fund will use the cash to make investments government securities and obligations of U.S.
which either mature or have a demand feature banks. The Fund may invest in any money
to resell to the issuer at a date simultaneous market instrument that is a permissible
with or prior to the time the Fund must investment for a money market fund under the
repurchase the security. rules of the SEC, including commercial paper,
certificates of deposit, time deposits,
bankers' acceptances, mortgage-backed and
asset-backed securities, repurchase
agreements, municipal obligations and other
short-term debt securities.
|
AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is subject to the diversification requirements applicable to money market funds under
the Investment Company Act.
Industry concentration AmSouth Treasury Reserve Money Market Fund may Pioneer Cash Reserves Fund will not
not purchase any securities which would cause concentrate its assets in the securities of
25% or more of the Fund's total assets at the issuers in any one industry except with
time of purchase to be invested in securities respect to investments in obligations of (a)
of one or more issuers conducting their the U.S. government, its agencies, authorities
principal business activities in the same or instrumentalities and (b) domestic banks,
industry, provided that this Limitation shall purchase any security if, as a result (i) more
not apply to municipal securities; and than 5% of the assets of the Fund would be in
provided, further, that for the purpose of the securities of any one issuer, or (ii) more
this limitation only, private activity bonds than 25% of its assets would be in a
that are backed only by the assets and particular industry.
revenues of a non-governmental user shall not
be deemed to be municipal securities.
Restricted and illiquid AmSouth Treasury Reserve Money Market Fund may Pioneer Cash Reserves Fund will not invest
securities not invest more than 10% of its net assets in more than 10% of its net assets in illiquid
securities that are restricted as to resale, and other securities that are not readily
or for which no readily available market marketable. Repurchase agreements maturing in
exists, including repurchase agreements more than seven days will be included for
providing for settlement more than seven days purposes of the foregoing limit.
after notice.
Borrowing AmSouth Treasury Reserve Money Market Fund may Pioneer Cash Reserves Fund may not borrow
not borrow money or issue senior securities, money, except from banks for extraordinary
except the Fund may borrow from banks or enter purposes or to meet redemptions in amounts not
into reverse repurchase agreements for exceeding 33 1/3% of its total assets
temporary emergency purposes in amounts up to (including the amount borrowed).
33 1/3% of the value of its total assets at
the time of such borrowing. The Fund will not
purchase securities while borrowings
(including reverse repurchase agreements) in
excess of 5% of its total assets are
outstanding. In addition, the Fund is
permitted to participate in a credit facility
whereby the Fund may directly lend to and
borrow money from other AmSouth Funds for
temporary purposes, provided that the loans
are made in accordance with an order of
exemption from the SEC and any conditions
thereto.
Lending AmSouth Treasury Reserve Money Market Fund may Pioneer Cash Reserves Fund may not make loans
not make loans, except that the Fund may to any person, except by (a) the purchase of a
purchase or hold debt instruments in debt obligation in which the Fund is permitted
accordance with its investment objective and to invest and (b) engaging in repurchase
policies, lend Fund securities in accordance agreements.
with its investment objective and policies and
enter into repurchase agreements. In
addition, the Fund is permitted to participate
in a credit facility whereby the Fund may
directly lend to and borrow money from other
AmSouth Funds
|
AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
for temporary purposes, provided that the loans
are made in accordance with an order of
exemption from the SEC and any conditions
thereto.
Derivative instruments AmSouth Treasury Reserve Money Market Fund may Pioneer Cash Reserves Fund may not write,
not write or purchase call options. purchase or otherwise invest in any put, call,
straddle or spread option.
Other investment policies As described above, the Funds have similar principal investment strategies and policies.
and restrictions Certain of the non-principal investment policies and restrictions are different. For a more
complete discussion of each Fund's other investment policies and fundamental and
non-fundamental investment restrictions, see the SAI.
Buying, Selling and Exchanging Shares
Class A sales charges and Class A shares are offered without sales Class A shares are offered without sales
Rule 12b-1 fees charges. charges.
Class A shares pay a shareholder servicing fee There is no contingent deferred sales charge
(non 12b-1) of up to 0.25% of average daily ("CDSC"), except in certain circumstances when
net assets. the initial sales charge is waived.
AmSouth Treasury Reserve Money Market Fund Class A shares are subject to distribution and
does not offer Class B shares. service (12b-1) fees of up to 0.15% of average
daily net assets.
Pioneer Cash Reserves Fund offers several
classes of shares, including Class A shares.
Class I and Class Y sales AmSouth Treasury Reserve Money Market Fund The Fund does not impose any initial,
charges and Rule 12b-1 fees does not impose any initial or CDSC on Class I contingent deferred or asset based sales
shares. charge on Class Y shares.
The Fund may impose a shareholder servicing The distributor incurs the expenses of
fee (non 12b-1) of up to 0.15% of average distributing the Fund's Class Y shares, none
daily net assets. of which are reimbursed by the Fund or the
Class Y shareowners.
Management and other fees AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund pays Pioneer an
pays an advisory fee on a monthly basis at an annual fee equal to 0.40% of the Fund's
annual rate of 0.40% of the Fund's average average daily net assets.
daily net assets.
Pioneer has agreed to limit the Fund's
ASO Services Company, Inc. ("ASO") serves as expenses or waive a portion of its management
administrator and fund accounting agent for fee to maintain a net asset value of $1.00.
the Fund. The Fund pays ASO an administrative Under certain circumstances, this limitation
services fee of 0.15% of the Fund's average may result in a 0.00% yield for one or more
daily net assets. classes for shares. From time to time,
Pioneer and its affiliates may limit the
Other expenses of the Fund are being limited expenses of one or more classes for the
to 0.36% for Class A shares. Any fee waiver purpose of increasing its yield during the
or expense reimbursement arrangement is period of the limitation. These expense
|
AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
voluntary and may be discontinued at any time. limitation policies are voluntary and
temporary and may be revised or terminated by
Other expenses are being limited to 0.28% for Pioneer at any time without notice.
Class I shares. Any fee waiver or expense
reimbursement arrangement is voluntary and may For the fiscal year ended December 31, 2004,
be discontinued at any time. the Fund's total annual operating expenses for
Class A shares were 0.93% of average daily net
For the fiscal year ended July 31, 2004, the assets.
Fund's annual operating expenses for Class A
shares, after giving effect to the expense Class Y shares of Pioneer Cash Reserves Fund
limitation were 0.76%, and without giving are being offered for the first time in
effect to the expense limitation, were 0.95% connection with the Reorganization.
of average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.68%, and without giving
effect to the expense limitation, were 0.85%
of average daily net assets.
Buying shares You may buy shares of AmSouth Treasury Reserve You may buy shares from any investment firm
Money Market Fund directly through BISYS Fund that has a sales agreement with PFD, the
Services, the Fund's distributor, or through Fund's distributor.
brokers, registered investment advisers, banks
and other financial institutions that have If the account is established in the
entered into selling agreements with the shareholder's own name, shareholders may also
Fund's distributor, as described in the Fund's purchase additional shares of the Fund by
prospectus. telephone or online.
Certain account transactions may be done by
telephone.
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. Shares you acquire as part of an
requirements for the Fund into which you are exchange will continue to be subject to any
exchanging. Exchanges from one Fund to another CDSC that applies to the shares you originally
are taxable. Class A shares may be exchanged purchased. When you ultimately sell your
for Class I shares of the same Fund or another shares, the date of your original purchase
AmSouth Fund if you become eligible to will determine your CDSC. An exchange
purchase Class I shares. Class I shares may generally is treated as a sale and a new
be exchanged for Class A shares of the same purchase of shares for federal income tax
Fund. No transaction fees are currently purposes.
charged for exchanges.
After you establish an eligible Fund account,
you can exchange Fund shares by telephone or
online.
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund
receives your request in good order.
|
AmSouth Treasury Reserve Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or by request to sell shares to PIMSS. You can also
contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in your
name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. The Pioneer Fund may be subject to greater credit risk than the AmSouth Fund because it may invest in securities other than U.S. Government securities. You could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o In the case of Pioneer Cash Reserves Fund, the issuer of a security owned by the Fund may not be able to make timely payments because of a general economic downturn or increased governmental costs
o The adviser's judgment about the credit quality, attractiveness or relative value of a particular security proves to be incorrect
Pioneer Cash Reserves Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Fund invests in issuers in countries with emerging markets or if the Fund invests significantly in one country. These risks may include:
o Inadequate financial information
o Smaller, less liquid and more volatile markets
o Political and economic upheavals
Pioneer Cash Reserves does not concentrate its investments in any industry. At times, more than 25% of the Pioneer Cash Reserves Fund's assets may be invested in the same market segment, such as financials. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus. For example, industries in the financial segment, such as banks, insurance companies, broker-dealers and REITs, may be sensitive to changes in interest rates and general economic activity and are subject to extensive government regulation.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return has varied from year to year for each full calendar year. The tables show average annual total return for each Fund over time for each class of shares compared with a broad-based securities market index. The bar charts give an indication of the risks of
investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance does not indicate future results.
AmSouth Treasury Reserve Money Market Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 5.41 1996 4.78 1997 4.78 1998 4.68 1999 4.38 2000 5.54 2001 3.47 2002 0.96 2003 0.29 2004 0.61 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 1.43% for the quarter ended December 31, 2000, and the lowest quarterly return was 0.04% for the quarter ended December 31, 2003.
Pioneer Cash Reserves Fund -- Class A Shares Calendar Year Total Returns*
[BAR CHART]
1995 5.17 1996 4.65 1997 4.78 1998 4.84 1999 4.23 2000 5.53 2001 3.32 2002 1.15 2003 0.26 2004 0.45 |
* During the period shown in the bar chart, Pioneer Cash Reserves Fund's highest quarterly return was 1.45% for the quarter ended December 31, 2000, and the lowest quarterly return was 0.01% for the quarter ended December 31, 2003.
AmSouth Treasury Reserve Money Market Fund Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------------------------------------------
AmSouth Treasury Reserve Money Market Fund, Class A Shares
Return Before Taxes(1) 0.61% 2.15% 3.47%
AmSouth Treasury Reserve Money Market Fund, Class I Shares
Return Before Taxes(1) 0.66% 2.25% 3.59%
|
(1) The return reported above assumes the reinvestment of dividends. The AmSouth Treasury Reserve Money Market Fund commenced operations on 3/29/94 through a transfer of assets from certain collective trust fund ("commingled") accounts managed by AAMI, using substantially the same investment objective, polices and methodologies as the Fund. The quoted performance of the Fund includes the performance of the commingled accounts for the periods prior to the Fund's
commencement of operations, restated to reflect the expenses associated with the Fund. The commingled accounts were not registered with the SEC and were not subject to the investment restrictions imposed by law on registered mutual funds. If the commingled accounts had been registered, their returns may have been adversely affected. Class A Shares were first offered on 8/29/94.
Pioneer Cash Reserves Fund Average Annual Total Returns as of December 31, 2004
1 Year 5 Years 10 Years
------------------------------------------------------------------------------------------------------------------------------
Pioneer Cash Reserves Fund, Class A shares
Return Before Taxes(1) 0.45% 2.12% 3.42%
Pioneer Cash Reserves Fund, Class Y shares(2)
90-day U.S. Treasury Bill 1.38% 2.67% 3.88%
(reflects no deduction for taxes)
|
(1) Return before taxes assumes that you sell your Class A shares at the end of the period and that you reinvest all of your dividends and distributions.
(2) Class Y shares were not outstanding prior to the closing of the Reorganization and consequently have no performance history. However, the performance record of the Class Y shares would be modestly higher than the performance of the Class A and Class B shares due to the lower expenses applicable to Class Y shares.
7-Day Yield
As of December 31, 2004
-------------------------------------------------------------------------------------------------------------------
AmSouth Treasury Reserve Money Market Fund, Class A Shares 1.43%
Pioneer Cash Reserves Fund, Class A Shares 1.12%
AmSouth Treasury Reserve Money Market Fund, Class I Shares 1.48%
|
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Treasury Reserve Money Market Fund, the expenses of AmSouth Treasury Reserve Money Market Fund for the period ended January 31, 2005, and (ii) for the Pioneer Cash Reserves Fund, the expenses of Pioneer Cash Reserves Fund for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. Shareholders of AmSouth Prime Money Market Fund are also being asked to approve the reorganization of their fund into Pioneer Cash Reserves Fund. The tables also show (1) the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004, and (2) the pro forma expenses of the combined Fund assuming the reorganization of AmSouth Prime Money Market Fund into Pioneer Cash Reserves Fund also occurred December 31, 2004.
Combined Combined
Fund Fund
AmSouth (including AmSouth (including
Shareholder Treasury AmSouth Treasury AmSouth
transaction fees Reserve Prime Money Reserve Prime Money
(paid directly Money Pioneer Cash Combined Market Money Combined Market
from your Market Reserves Fund (Pro Fund) (Pro Market Fund (Pro Fund) (Pro
investment) Fund(1) Fund Forma) Forma) Fund(1) Forma) Forma)
---------------------------------------------------------------------------------------------------------------------------------
Class A Class A Class A Class A Class I Class Y(7) Class Y(7)
---------------------------------------------------------------------------------------------------------------------------------
Maximum sales charge
(load) when you buy
shares as a
percentage of
offering price None None None None None None None
---------------------------------------------------------------------------------------------------------------------------------
Maximum deferred
sales charge (load)
as a percentage of
purchase price or
the amount you
receive when you
sell shares,
whichever is less None None None None None None None
---------------------------------------------------------------------------------------------------------------------------------
Redemption fees None(2) None None None None None None
---------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating expenses
(deducted from Fund
assets) (as a % of
average net assets)
---------------------------------------------------------------------------------------------------------------------------------
Management fee 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40%
---------------------------------------------------------------------------------------------------------------------------------
Distribution and
service (12b-1) fee None 0.15% 0.15% 0.15% None 0.15% None
---------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.57%(3) 0.38% 0.31% 0.17% 0.47% 0.07%(6) 0.06%(6)
---------------------------------------------------------------------------------------------------------------------------------
Total fund operating
expenses 0.97% 0.93%(4) 0.86% 0.72% 0.87%(3) 0.47% 0.46%
---------------------------------------------------------------------------------------------------------------------------------
Expense
reimbursement/reduction 0.27% None(5) None(5) None(5) 0.22% None(5) None(5)
---------------------------------------------------------------------------------------------------------------------------------
Net fund operating
expenses 0.70% 0.93% 0.86% 0.72% 0.65% 0.47% 0.46%
---------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(3) Other expenses for your AmSouth Fund are being limited to 0.30% for Class A shares and 0.25% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(4) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(5) Pioneer has agreed to limit the Fund's expenses or waive a portion of its management fee to maintain a net asset value of $1.00. Under certain circumstances, this limitation may result in a 0.00% yield for one or more classes for shares. From time to time, Pioneer and its affiliates may limit the expenses of one or more classes for the purpose of increasing its yield during the period of the limitation. These expense limitation policies are voluntary and temporary and may be revised or terminated by Pioneer at any time without notice.
(6) Other expenses for Class Y shares are estimated based on expenses that would have been incurred for the fiscal year ended December 31, 2004 had such shares been outstanding for the entire fiscal year.
(7) Class Y shares of Pioneer Cash Reserves Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, (d) each Fund's operating expenses remain the same and (e) you sell your shares at the end of the time period shown. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
Combined Fund
(including AmSouth
AmSouth Treasury Prime Money Market
Number of years you Reserve Money Pioneer Cash Reserves Combined Fund Fund)*
own your shares Market Fund Fund (Pro Forma) (Pro Forma)
--------------------------------------------------------------------------------------------------------
Class A
--------------------------------------------------------------------------------------------------------
Year 1 $ 99 $ 95 $ 658 $ 644
--------------------------------------------------------------------------------------------------------
Year 3 $ 309 $ 296 $ 834 $ 792
--------------------------------------------------------------------------------------------------------
Year 5 $ 536 $ 515 $ 1,024 $ 953
--------------------------------------------------------------------------------------------------------
Year 10 $ 1,190 $1,143 $ 1,575 $1,418
--------------------------------------------------------------------------------------------------------
Class I Class Y
--------------------------------------------------------------------------------------------------------
Year 1 $ 89 N/A $ 48 $ 47
--------------------------------------------------------------------------------------------------------
Year 3 $ 278 N/A $ 151 $ 148
--------------------------------------------------------------------------------------------------------
Year 5 $ 482 N/A $ 263 $ 258
--------------------------------------------------------------------------------------------------------
Year 10 $ 1,073 N/A $ 591 $ 579
--------------------------------------------------------------------------------------------------------
|
* Pursuant to a separate proposal, AmSouth Prime Money Market Fund proposes to transfer its assets to Pioneer Cash Reserves Fund.
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Treasury Reserve Money Market Fund and its shareholders. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, after the Reorganization, the combined Fund will have an asset size substantially larger than that of your AmSouth Fund, which may allow the combined Fund to achieve significant economies of scale in investments or expenses.
Third, the historical investment performance of Pioneer Cash Reserves Fund is comparable to your AmSouth Fund's investment performance. For the one, five and ten year periods ended December 31, 2004, Class A shares of Pioneer Cash Reserves Fund had an average annual return of 0.45% (one year); 2.12% (five year); and 3.42% (ten year) compared to an average annual return of the Class A shares of your AmSouth Fund of 0.61% (one year); 2.15% (five year); and 3.47% (ten year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing fixed income mutual funds.
Fourth, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fifth, Pioneer Cash Reserves Fund's management fee (0.40% of average daily net assets) is the same as the advisory fee of your AmSouth Fund (0.40% of average daily net assets). Although the historical net expenses of Pioneer Cash Reserves Fund are higher than your AmSouth Fund's historical net expenses, the estimated pro forma gross expenses of the Pioneer Fund after giving effect to the Reorganization are lower than your AmSouth Fund's gross expenses. In addition, with respect to Class Y shares, the pro forma expense of the Pioneer Fund, net of expense limitations, are lower than your Fund's net expenses attributable to Class I shares. The net expenses attributable to the Class A shares of the Pioneer Fund on a pro forma basis are estimated to be two basis points higher than the net expenses attributable to the Class A shares of the AmSouth Fund. However, AAMI has informed the trustees that its expense limitations will be discontinued in the future. The distribution and shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduce per share expenses.
Sixth, the substantially larger size of Pioneer Cash Reserves Fund offers greater opportunity for diversification of the investment portfolio, which should help to reduce risks.
Seventh, the Class A and Y shares of Pioneer Cash Reserves Fund received in the Reorganization will provide AmSouth Treasury Reserve Money Market Fund shareholders with exposure to substantially the same investment product as they currently have. The Board considered the differences in the investment policies of the two Funds and concluded that the broader investment range of Pioneer Cash Reserves Fund did not materially increase the risk exposure to AmSouth Treasury Reserve Money Market Fund shareholders.
Eighth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the AmSouth Funds' proxy statements and solicitation costs incurred by the AmSouth Funds in connection with the Reorganization. AAMI will otherwise be responsible of all costs and expenses of the AmSouth Funds in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Prime Money Market Fund approve the reorganization of their fund into Pioneer Cash Reserves Fund.
Pro Forma
Pioneer Cash
Reserves Fund
AmSouth (including
Treasury Pioneer Cash Pro Forma AmSouth Prime
Reserve Money Reserves Pioneer Cash Money Market
Market Fund Fund Reserves Fund Fund)
May 31, 2005 May 31, 2005 May 31, 2005 May 31, 2005
------------- ------------ ------------- -------------
Total Net Assets (in thousands) $ 178,746 $ 419,881 $ 598,627 $ 1,226,225
Class A shares ............. $ 72,843 $ 212,426 $ 285,269 $ 698,111
Class B shares ............. N/A $ 50,365 $ 50,365 $ 53,515
Class I/Y shares ........... $ 105,903 N/A $ 105,903 $ 317,508
Net Asset Value Per Share
Class A shares ............. $ 1.00 $ 1.00 $ 1.00 $ 1.00
Class B shares ............. N/A $ 1.00 $ 1.00 $ 1.00
Class I/Y shares ........... $ 1.00 N/A $ 1.00 $ 1.00
Shares Outstanding
Class A shares ............. 72,852,140 212,571,273 285,464,278 698,590,414
Class B shares ............. N/A 50,321,650 50,321,650 53,468,483
Class I/Y shares ........... 105,913,462 N/A 105,913,462 317,725,662
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Prime Money Market Fund and Pioneer Cash Reserves Fund
PROPOSAL 1(u)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund invests primarily in high-quality short-term securities and, consequently, the Funds have similar policies and risks. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Prime Money Market Fund to Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified series of Pioneer Money Market
open-end management investment company Trust, an open-end management investment
organized as a Massachusetts business trust. company organized as a Delaware statutory
trust.
------------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, $583.9 million $513.9 million
2005
------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Portfolio Manager:
Day-to-day management of AmSouth Prime Money Day-to-day management of the Fund's portfolio
Market Fund's portfolio is the responsibility is the responsibility of Andrew Feltus. Mr.
of a team of AAMI's portfolio managers, and no Feltus, a vice president, joined Pioneer in
person is primarily responsible for making 1994.
recommendations to the team.
------------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Prime Money Market Fund seeks
to Pioneer Cash Reserves Fund seeks high current
provide investors with current income with income
and preservation of capital and liquidity and
stability of principal. liquidity.
------------------------------------------------------------------------------------------------------------------------------
Primary investments AmSouth Prime Money Market Fund invests only Pioneer Cash Reserves Fund invests in U.S.
in U.S. dollar-denominated, "high-quality" government obligations and money market
short-term debt securities, including securities rated in one of the two highest
obligations issued or guaranteed by the U.S. rating categories for short-term debt by a
government, its agencies or instrumentalities, nationally recognized statistical rating
certificates of deposit, time deposits, organization or, if unrated, determined to be
bankers' acceptances and other short-term of equivalent credit quality by Pioneer. If
securities issued by domestic or foreign banks rating organizations differ in the rating
or their subsidiaries or branches, domestic assigned to a security, the Fund will only
and foreign commercial paper and other treat the security as having the higher rating
short-term corporate debt obligations, if at least two rating organizations assigned
including those with floating or variable that rating. If a rating organization
rates of interest, obligations issued or downgrades the quality rating assigned to one
guaranteed by one or more foreign or more of
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
governments or their agencies or the Fund's portfolio securities, Pioneer will
instrumentalities, including obligations promptly reassess whether the downgraded
of supranational entities, asset-backed security presents minimal credit risk to the
securities, repurchase agreements Fund.
collateralized by the types of
securities listed above.
------------------------------------------------------------------------------------------------------------------------------
Investment strategies The Fund invests in securities issued by: (i) Pioneer Cash Reserves Fund seeks to maintain a
FNMA, FHLMC, SLMA and the FHLBs, constant net asset value of $1.00 per share by
which are supported by the right of the issuer investing in high-quality, U.S. dollar
to borrow from the U.S. Treasury; and (ii) denominated money market securities, including
FFCBs and TVA, which are supported only by the those issued by U.S. and foreign banks, U.S.
credit of the issuer. and foreign corporate issuers, the U.S.
government and its agencies and
When selecting securities for the Fund's instrumentalities, foreign governments, and
portfolio, AAMI first considers safety of multinational organizations such as the World
principal and the quality of an investment. Bank.
AAMI then focuses on generating a high level
of income. AAMI generally evaluates The Fund invests exclusively in securities
investments based on interest rate sensitivity with a maximum remaining maturity of 397 days
selecting those securities whose maturities and maintains a dollar-weighted average
fit the Fund's interest rate sensitivity portfolio maturity of 90 days or less. The
target and which AAMI believes to be the best Fund's investments may have fixed, floating or
relative values. The Fund will maintain an variable interest rates.
average weighted portfolio maturity of 90 days
or less and will limit the maturity of each In selecting the Fund's portfolio, Pioneer
security in its portfolio to 397 days or less. complies with the rating, maturity and
diversification requirements applicable to
money market funds. Within those limits,
Pioneer's assessment of broad economic
factors that are expected to affect economic
activity and interest rates influence its
securities selection. Pioneer also employs
due diligence and fundamental research, an
evaluation of the issuer based on its
financial statements and operations, to
assess an issuer's credit quality.
------------------------------------------------------------------------------------------------------------------------------
Other investments AmSouth Prime Money Market Fund also invests Pioneer Cash Reserves Fund may invest more
in mortgage-related securities issued by than 25% of its total assets in U.S.
nongovernmental entities which are rated, at government securities and obligations of U.S.
the time of purchase, in one of the four banks. The Fund may invest in any money
highest rating categories by a nationally market instrument that is a permissible
recognized statistical rating organization investment for a money market fund under the
("NRSRO") or, if unrated, determined by its rules of the SEC, including commercial paper,
Advisor to be of comparable quality. certificates of deposit, time deposits,
"High-quality" debt securities are those bankers' acceptances, mortgage-backed and
obligations which, at the time of purchase, asset-backed securities, repurchase
(i) possess the highest short-term rating from agreements, municipal obligations and other
at least two NRSROs (for example, commercial short-term debt securities.
paper rated "A-1" by S&P, and "P-1" by Moody's
Investors Service, Inc.) or one NRSRO if only
rated by one NRSRO or (ii) if unrated, are
determined by AAMI to be of comparable Quality.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
Temporary defensive Pioneer Cash Reserves Fund may invest all or
strategies part of its assets in securities with
remaining maturities of less than one year,
cash equivalents or may hold cash.
------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is subject to the diversification requirements applicable to money market funds
under the Investment Company Act of 1940.
------------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Prime Money Market Fund may not Pioneer Cash Reserves Fund will not
purchase any securities which would cause more concentrate its assets in the securities of
than 25% of the value of the Fund's total issuers in any one industry except with
assets at the time of purchase to be invested respect to investments in obligations of (a)
in securities of one or more issuers the U.S. government, its agencies, authorities
conducting their principal business activities or instrumentalities and (b) domestic banks,
in the same industry, provided that (a) there purchase any security if, as a result (i) more
is no limitation with respect to obligations than 5% of the assets of the Fund would be in
issued or guaranteed by the U.S. government or the securities of any one issuer, or (ii) more
its agencies or instrumentalities, bank than 25% of its assets would be in a
certificates of deposit or bankers' particular industry.
acceptances issued by a domestic bank or by a
U.S. branch of a foreign bank provided that
such U.S. branch is subject to the same
regulation as U.S. banks, and repurchase
agreements secured by bank instruments or
obligations of the U.S. government or its
agencies or instrumentalities; (b) wholly
owned finance companies will be considered to
be in the industries of their parents if their
activities are primarily related to financing
the activities of their parents; and (c)
utilities will be divided according to their
services. For example, gas, gas transmission,
electric and gas, electric, and telephone will
each be considered a separate industry.
------------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Prime Money Market Fund may not Pioneer Cash Reserves Fund will not invest
securities invest more than 10% of its net assets in more than 10% of its net assets in illiquid
securities that are restricted as to resale, and other securities that are not readily
or for which no readily available market marketable. Repurchase agreements maturing in
exists, including repurchase agreements more than seven days will be included for
providing for settlement more than seven days purposes of the foregoing limit.
after notice.
------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Prime Money Market Fund may not borrow Pioneer Cash Reserves Fund may not borrow
money or issue senior securities, except the money, except from banks for extraordinary
Fund may borrow from banks or enter into purposes or to meet redemptions in amounts not
reverse repurchase agreements for temporary exceeding 33 1/3% of its total assets
emergency purposes in amounts up to 33 1/3% of (including the amount borrowed).
the value of its total assets at the time of
such borrowing. The Fund will not purchase
securities while borrowings (including reverse
repurchase agreements) in excess of 5% of its
total assets are outstanding. In addition,
the Fund is permitted to participate in a
credit facility whereby the Fund may directly
lend to and borrow money from other AmSouth
funds for temporary purposes, provided that
the loans are made in accordance with an order
of exemption from the SEC and any conditions
thereto.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Prime Money Market Fund may not make Pioneer Cash Reserves Fund may make loans to
loans, except that the Fund may purchase or any person, except by (a) the purchase of a
hold debt instruments in accordance with its debt obligation in which the Fund is permitted
investment objective and policies, lend Fund to invest and (b) engaging in repurchase
securities in accordance with its investment agreements.
objective and policies and enter into
repurchase agreements. In addition, the Fund
is permitted to participate in a credit
facility whereby the Fund may directly lend to
and borrow money from other AmSouth funds for
temporary purposes, provided that the loans
are made in accordance with an order of
exemption from the SEC and any conditions
thereto.
------------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Prime Money Market Fund may not write Pioneer Cash Reserves Fund may not write,
or purchase call options. purchase or otherwise invest in any put, call,
straddle or spread option.
------------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment
and restrictions strategies and policies. Certain of the non-principal investment policies and
restrictions are different. For a more complete discussion of each Fund's other
investment policies and fundamental and non-fundamental investment restrictions,
see the SAI.
------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
------------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered without sales Class A shares are offered without sales
Rule 12b-1 fees charges. charges.
Class A shares pay a shareholder servicing There is no contingent deferred sales charge
fee (non 12b-1) of up to 0.25% of average ("CDSC"), except in certain circumstances
daily net assets. when the initial sales charge is waived.
Class A shares are subject to distribution
and service (12b-1) fees of up to 0.15% of
average daily net assets.
------------------------------------------------------------------------------------------------------------------------------
Class B sales charges and Class B shares are offered without an initial Class B shares are offered without an initial
Rule 12b-1 fees sales charge, but are subject to a CDSC of up sales charge, but are subject to a CDSC of up
to 5%. For Class B shares purchased prior to to 4% if you sell your shares. The charge is
the combination of AmSouth Funds with ISG reduced over time and is not charged after
Funds, the CDSC on such Class B shares held five years. Your investment firm may receive
continuously declines over six years, a commission from PFD, the Fund's
starting with year one and ending in year distributor, at the time of your purchase of
seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all up to 4%.
other Class B shares held continuously, the
CDSC declines over six years, starting with Class B shares are subject to distribution
year one and ending in year seven from: 5%, and service (12b-1) fees of up to 1% of
4%, 3%, 3%, 2%, 1%. Eight years after average daily net assets.
purchase (seven years in the case of shares
acquired in the ISG Class B shares acquired through the
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
combination), Class B shares automatically Reorganization will be subject to the CDSC
convert to Class A shares. and commission schedules applicable to the
original purchase.
Class B shares pay a shareholder servicing
fee (non 12b-1) of up to 0.25% of average Maximum purchase of Class B shares in a
daily net assets, and a distribution (12b-1) single transaction is $49,999.
fee of 0.75% of average daily net assets.
Maximum investment for all Class B purchases
by a shareholder for the Fund's shares is
$99,999.
------------------------------------------------------------------------------------------------------------------------------
Class I and Class Y AmSouth Prime Money Market Fund does not The Fund does not impose any initial,
sales charges and Rule impose any initial or CDSC on Class I shares. contingent deferred or asset based sales charge
12b-1 fees on Class Y shares.
The Fund may impose a shareholder servicing
fee (non 12b-1) of up to 0.15% of average The distributor incurs the expenses of
daily net assets. distributing the Fund's Class Y shares, none
of which are reimbursed by the Fund or the
Class Y shareowners.
------------------------------------------------------------------------------------------------------------------------------
Management and other AmSouth Prime Money Market Fund pays an Pioneer Cash Reserves Fund pays Pioneer an
fees advisory fee on a monthly basis at an annual annual fee equal to 0.40% of the Fund's
rate of 0.40% of the Fund's average daily net average daily net assets. The fee is computed
assets. daily and paid monthly.
ASO Services Company, Inc. ("ASO") serves as Pioneer has agreed to limit the Fund's
administrator and fund accounting agent for expenses or waive a portion of its management
the Fund. The Fund pays ASO an administrative fee to maintain a net asset value of $1.000.
services fee of 0.15% of the Fund's average Under certain circumstances, this limitation
daily net assets. may result in a 0.00% yield for one or more
classes for shares. From time to time,
Other expenses of the Fund are being limited Pioneer and its affiliates may limit the
to 0.38% for Class A shares. Any fee waiver expenses of one or more classes for the
or expense reimbursement arrangement is purpose of increasing its yield during the
voluntary and may be discontinued at any period of the limitation. These expense
time. limitation policies are voluntary and
temporary and may be revised or terminated by
Other expenses of the Fund are being limited Pioneer at any time without notice.
to 0.22% for Class B shares. Any fee waiver
or expense reimbursement arrangement is For the fiscal year ended December 31, 2004,
voluntary and may be discontinued at any the Fund's total annual operating expenses
time. for Class A shares were 0.93% of average
daily net assets.
Other expenses of the Fund are being limited
to 0.23% for Class I shares. Any fee waiver For the fiscal year ended December 31, 2004,
or expense reimbursement arrangement is the Fund's total annual operating expenses
voluntary and may be discontinued at any for Class B shares were 1.81% of average
time. daily net assets.
For the fiscal year ended July 31, 2004, the Class Y shares of Pioneer Cash Reserves Fund
Fund's annual operating expenses for Class A are being offered for the first time in
shares, after giving effect to the expense connection with the Reorganization.
limitation were 0.78%, and without giving
effect to the expense limitation, were 0.90%
of
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class B
shares, after giving effect to the expense
limitation were 0.93%, and without giving
effect to the expense limitation, were 1.65%
of average daily net assets.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.63%, and without giving
effect to the expense limitation, were 0.80%
of average daily net assets.
------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of AmSouth Prime Money You may buy shares from any investment firm
Market Fund directly through BISYS Fund that has a sales agreement with PFD, the
Services, the Fund's distributor, or through Fund's distributor.
brokers, registered investment advisers, banks
and other financial institutions that have If the account is established in the
entered into selling agreements with the shareholder's own name, shareholders may also
Fund's distributor, as described in the Fund's purchase additional shares of the Fund by
prospectus. telephone or online.
Certain account transactions may be done by
telephone.
------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of the
shares of the same class of another AmSouth same class of another Pioneer mutual fund.
Fund, usually without paying additional sales Your exchange request must be for at least
charges. You must meet the minimum investment $1,000. Shares you acquire as part of an
requirements for the Fund into which you are exchange will continue to be subject to any
exchanging. Exchanges from one Fund to CDSC that applies to the shares you originally
another are taxable. Class A shares may be purchased. When you ultimately sell your
exchanged for Class I shares of the same Fund shares, the date of your original purchase
or another AmSouth fund if you become eligible will determine your CDSC. An exchange
to purchase Class I shares. Class I shares generally is treated as a sale and a new
may be exchanged for Class A shares of the purchase of shares for federal income tax
same Fund. No transaction fees are currently purposes.
charged for exchanges.
After you establish an eligible Fund account,
you can exchange Fund shares by telephone or
online.
------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after
the Fund receives your request in good order.
-------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
------------------------------------------------------------------------------------------------------------------------------
|
------------------------------------------------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund Pioneer Cash Reserves Fund
------------------------------------------------------------------------------------------------------------------------------
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. Even though each Fund seeks to maintain a constant net asset value of $1.00, you could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o The issuer of a security owned by the Fund may not be able to make timely
payments because of a general economic downturn or increased governmental
costs
o The adviser's judgment about the credit quality, attractiveness or relative
value of a particular security proves to be incorrect
Pioneer Cash Reserves Fund may be subject to the following additional risks associated with investing in non-U.S. issuers, which may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent the Fund invests in issuers in countries with emerging markets or if the Fund invests significantly in one country. These risks may include:
o Inadequate financial information
o Smaller, less liquid and more volatile markets
o Political and economic upheavals
Pioneer Cash Reserves does not concentrate its investments in any industry. At times, more than 25% of the Pioneer Cash Reserves Fund's assets may be invested in the same market segment, such as financials. To the extent the Fund emphasizes investments in a market segment, the Fund will be subject to a greater degree to the risks particular to the industries in that segment, and may experience greater market fluctuation, than a fund without the same focus. For example, industries in the financial segment, such as banks, insurance companies, broker-dealers and REITs, may be sensitive to changes in interest rates and general economic activity and are subject to extensive government regulation.
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return (before and after taxes) for each Fund over time for each class of shares (including deductions for sales charges) compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance before and after taxes does not indicate future results. No Class Y shares of Pioneer Cash Reserves Fund are currently outstanding.
AmSouth Prime Money Market Fund -- Class A Shares Calendar Year Total Returns*
[The following table was depicted as a bar chart in the printed material.]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 5.5 4.84 4.98 4.88 4.49 5.73 3.46 0.98 0.39 0.60 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 1.48% for the quarter ended December 31, 2000, and the lowest quarterly return was 0.08% for the quarter ended December 31, 2003.
Pioneer Cash Reserves Fund -- Class A Shares Calendar Year Total Returns*
[The following table was depicted as a bar chart in the printed material.]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 5.17 4.65 4.78 4.84 4.23 5.53 3.32 1.15 0.26 0.45 |
* During the period shown in the bar chart, Pioneer Cash Reserves Fund's highest quarterly return was 1.48% for the quarter ended December 31, 2000, and the lowest quarterly return was 0.07% for the quarter ended June 30, 2004.
AmSouth Prime Money Market Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund, Class A Shares
---------------------------------------------------------------------------------------
Return Before Taxes(1) 0.60% 2.20% 3.56%
---------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund, Class B Shares
---------------------------------------------------------------------------------------
Return Before Taxes(2) 0.45% 1.68% N/A
---------------------------------------------------------------------------------------
AmSouth Prime Money Market Fund, Class I Shares
---------------------------------------------------------------------------------------
Return Before Taxes(3) 0.75% 2.35% 3.68%
---------------------------------------------------------------------------------------
|
(1) The return reported above assumes the reinvestment of dividends. Performance for the Class A shares, which were first offered on April 1, 1996, is based on the historical performance of the Class I shares prior to that date.
(2) The return reported above assumes the reinvestment of dividends, includes the applicable CDSC and assumes that Class B shareholders redeem all of their Fund shares at the end of the period indicated. Class B shares were first offered on June 15, 1998.
(3) The return reported above assumes the reinvestment of dividends.
Pioneer Cash Reserves Fund Average Annual Total Returns as of December 31, 2004
---------------------------------------------------------------------------------------
1 Year 5 Years 10 Years
---------------------------------------------------------------------------------------
Pioneer Cash Reserves Fund, Class A shares
---------------------------------------------------------------------------------------
Return Before Taxes(1) 0.45% 2.12% 3.42%
---------------------------------------------------------------------------------------
Pioneer Cash Reserves Fund, Class B Shares
---------------------------------------------------------------------------------------
Return Before Taxes(2) 3.94% 1.49% N/A
---------------------------------------------------------------------------------------
Pioneer Cash Reserves Fund, Class Y Shares(3)
---------------------------------------------------------------------------------------
90-day U.S. Treasury Bill 1.38% 2.67% 3.88%
(reflects no deduction for taxes)
---------------------------------------------------------------------------------------
|
(1) Return before taxes assumes that you sell your Class A shares at the end of the period and that you reinvest all of your dividends and distributions.
(2) Return before taxes assumes that you sell your Class B shares at the end of the period and that you reinvest all of your dividends and distributions.
(3) Class Y shares were not outstanding prior to the closing of the Reorganization and consequently have no performance history. However, the performance record of the Class Y shares would be modestly higher than the performance of the Class A and Class B shares due to the lower expenses applicable to Class Y shares.
-----------------------------------------------------------------------------------
7-Day Yield
As of December 31, 2004
-----------------------------------------------------------------------------------
AmSouth Prime Money Market Fund, Class A Shares 1.47%
-----------------------------------------------------------------------------------
Pioneer Cash Reserves Fund, Class A shares 1.12%
-----------------------------------------------------------------------------------
AmSouth Prime Money Market Fund, Class B Shares 1.32%
-----------------------------------------------------------------------------------
Pioneer Cash Reserves Fund, Class B shares 0.24%
-----------------------------------------------------------------------------------
AmSouth Prime Money Market Fund, Class I Shares 1.62%
-----------------------------------------------------------------------------------
|
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Prime Money Market Fund, the expenses of AmSouth Prime Money Market Fund for the period ended January 31, 2005 and (ii) for the Pioneer Cash Reserves Fund, the expenses of Pioneer Cash Reserves Fund for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. Shareholders of AmSouth Treasury Reserve Money Market Fund are also being asked to approve the reorganization of their fund into Pioneer Cash Reserves Fund. The tables also show (1) the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004, and (2) the pro forma expenses of the combined Fund assuming the reorganization of AmSouth Treasury Reserve Money Market Fund into Pioneer Cash Reserves Fund also occurred December 31, 2004.
-------------------------------------------------------------------------------------------------------------------------
Combined Fund
AmSouth (including AmSouth
Shareholder Prime Pioneer AmSouth Prime Pioneer
transaction Money Cash Combined Treasury Money Cash Combined
fees (paid Market Reserves Fund Reserve Market Reserves Fund
directly Fund(1) Fund (Pro Forma) Fund) Fund(1) Fund (Pro Forma)
from your (Pro Forma)
investment) Class A Class A Class A Class A Class B Class B Class B
-------------------------------------------------------------------------------------------------------------------------
Maximum sales None None None None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
-------------------------------------------------------------------------------------------------------------------------
Maximum deferred
sales charge
(load) as a
percentage of
purchase price or None None None None 5.00%(2) 4.00% 4.00%
the amount you
receive when you
sell shares,
whichever is less
-------------------------------------------------------------------------------------------------------------------------
Redemption fees None(3) None None None None(3) None None
-------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets) (as
a % of average
net assets)
-------------------------------------------------------------------------------------------------------------------------
Management fee 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40%
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------
Shareholder Combined AmSouth Combined Combined
transaction fees Fund Prime Fund (Pro Fund
(paid directly (including Money Forma) (including
from your AmSouth Market AmSouth
investment) Treasury Fund(1) Treasury
Reserve Reserve
Fund) Fund)
(Pro Forma) (Pro Forma)
Class B Class I Class Y(8) Class Y(8)
-------------------------------------------------------------------------
Maximum sales None None None None
charge (load)
when you buy
shares as a
percentage of
offering price
-------------------------------------------------------------------------
Maximum deferred
sales charge
(load) as a
percentage of
purchase price or 4.00% None None None
the amount you
receive when you
sell shares,
whichever is less
-------------------------------------------------------------------------
Redemption fees None None(3) None None
-------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets) (as
a % of average
net assets)
-------------------------------------------------------------------------
Management fee 0.40% 0.40% 0.40% 0.40%
-------------------------------------------------------------------------
|
-------------------------------------------------------------------------------------------------------------------------
Combined Fund
AmSouth (including AmSouth
Shareholder Prime Pioneer AmSouth Prime Pioneer
transaction Money Cash Combined Treasury Money Cash Combined
fees (paid Market Reserves Fund Reserve Market Reserves Fund
directly Fund(1) Fund (Pro Forma) Fund) Fund(1) Fund (Pro Forma)
from your (Pro Forma)
investment) Class A Class A Class A Class A Class B Class B Class B
-------------------------------------------------------------------------------------------------------------------------
Distribution and None 0.25% 0.15% 0.15% 0.75% 1.00% 1.00%
service (12b-1)
fee
-------------------------------------------------------------------------------------------------------------------------
Other expenses 0.56%(4) 0.38% 0.18% 0.17% 0.86%(4) 0.41% 0.38%
-------------------------------------------------------------------------------------------------------------------------
Total fund 0.96% 0.93%(5) 0.73% 0.72% 2.01% 1.81%(5) 1.78%
operating expenses
-------------------------------------------------------------------------------------------------------------------------
Expense 0.16% N/A(6) N/A N/A 1.06% N/A(6) N/A
reimbursement/
reduction
-------------------------------------------------------------------------------------------------------------------------
Net fund 0.80% 0.93% 0.73% 0.72% 0.95% 1.81% 1.78%
operating expenses
-------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------
Shareholder Combined AmSouth Combined Combined
transaction fees Fund Prime Fund (Pro Fund
(paid directly (including Money Forma) (including
from your AmSouth Market AmSouth
investment) Treasury Fund(1) Treasury
Reserve Reserve
Fund) Fund)
(Pro Forma) (Pro Forma)
Class B Class I Class Y(8) Class Y(8)
-------------------------------------------------------------------------
Distribution and 1.00% None None None
service (12b-1)
fee
-------------------------------------------------------------------------
Other expenses 0.39% 0.46%(4) 0.06%(7) 0.06%(7)
-------------------------------------------------------------------------
Total fund 1.79% 0.86% 0.46% 0.46%
operating expenses
-------------------------------------------------------------------------
Expense N/A 0.21% N/A(6) N/A(6)
reimbursement/
reduction
-------------------------------------------------------------------------
Net fund 1.79% 0.65% 0.46% 0.46%
operating expenses
-------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) For former Class B shares purchased prior to the combination of AmSouth Funds with ISG Funds, the CDSC on such Class B shares held continuously declines over six years, starting with year one and ending in year seven from: 4%, 3%, 3%, 2%, 2%, 1%. For all other Class B shares held continuously, the CDSC declines over six years, starting with year one and ending in year seven from: 5%, 4%, 3%, 3%, 2%, 1%. Eight years after purchase (seven years in the case of shares acquired in the ISG combination), Class B shares automatically convert to Class A shares.
(3) A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(4) Other expenses for your AmSouth Fund are being limited to 0.40% for Class A shares, 0.20% for Class B shares and 0.25% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(5) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(6) Pioneer has agreed to limit the Fund's expenses or waive a portion of its management fee to maintain a net asset value of $1.00. Under certain circumstances, this limitation may result in a 0.00% yield for one or more classes for shares. From time to time, Pioneer and its affiliates may limit the expenses of one or more classes for the purpose of increasing its yield during the period of the limitation. These expense limitation policies are voluntary and temporary and may be revised or terminated by Pioneer at any time without notice.
(7) Other expenses for Class Y shares are estimated based on expenses that would have been incurred for the fiscal year ended December 31, 2004 had such shares been outstanding for the entire fiscal year.
(8) Class Y shares of Pioneer Cash Reserves Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
---------------------------------------------------------------------------------------------------------
Combined Fund
(including AmSouth
Treasury Reserve
Number of years you AmSouth Prime Money Pioneer Cash Reserves Combined Fund Money Market Fund)
own your shares Market Fund Fund (Pro Forma) (Pro Forma)
---------------------------------------------------------------------------------------------------------
Class A
---------------------------------------------------------------------------------------------------------
Year 1 $98 $95 $645 $644
---------------------------------------------------------------------------------------------------------
Year 3 $306 $296 $795 $792
---------------------------------------------------------------------------------------------------------
Year 5 $531 $515 $958 $953
---------------------------------------------------------------------------------------------------------
Year 10 $1,178 $1,143 $1,429 $1,418
---------------------------------------------------------------------------------------------------------
Class B -- assuming redemption at end of period
---------------------------------------------------------------------------------------------------------
Year 1 $704 $584 $581 $582
---------------------------------------------------------------------------------------------------------
Year 3 $930 $869 $860 $863
---------------------------------------------------------------------------------------------------------
Year 5 $1,283 $1,080 $1,064 $1,070
---------------------------------------------------------------------------------------------------------
Year 10 $2,066 $1,895 $1,817 $1,823
---------------------------------------------------------------------------------------------------------
Class B -- assuming no redemption
---------------------------------------------------------------------------------------------------------
Year 1 $204 $184 $181 $182
---------------------------------------------------------------------------------------------------------
Year 3 $630 $569 $560 $563
---------------------------------------------------------------------------------------------------------
Year 5 $1,083 $980 $964 $970
---------------------------------------------------------------------------------------------------------
Year 10 $2,066 $1,895 $1,817 $1,823
---------------------------------------------------------------------------------------------------------
Class I Class Y
---------------------------------------------------------------------------------------------------------
Year 1 $88 N/A $47 $47
---------------------------------------------------------------------------------------------------------
Year 3 $274 N/A $148 $148
---------------------------------------------------------------------------------------------------------
Year 5 $477 N/A $258 $258
---------------------------------------------------------------------------------------------------------
Year 10 $1061 N/A $579 $579
---------------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Prime Money Market Fund and its shareholders. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the historical investment performance of Pioneer Cash Reserves Fund is comparable to your AmSouth Fund's investment performance. For example, the one, five and ten year periods ended December 31, 2004, Class A shares of Pioneer Cash Reserves Fund had an average annual return of 0.45% (one year); 2.12% (five year); and 3.42% (ten year) compared to an average annual return of the Class A shares of your AmSouth Fund of 0.60% (one year); 2.20% (five year); and 3.56% (ten year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Third, the resources of Pioneer. At December 31, 2004, Pioneer manages over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were
approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fourth, Pioneer Cash Reserves Fund's management fee (0.40% of average daily net assets) is the same as the advisory fee of your AmSouth Fund (0.40% of average daily net assets). The gross expenses of each class of the Pioneer Fund, on both a historical and pro-forma basis, are lower than the gross expenses attributable to the corresponding class of your Fund. Expenses, net of limitations, on a pro forma basis for the Class A and Class Y shares of the Pioneer Fund are lower than the net expenses of the corresponding Class of your Fund. With respect to Class B shares, your Fund's historical net expenses are lower than the pro-forma expenses attributable to the Class B shares of the Pioneer Fund. The pro forma expenses of Class B shares net of limitations will increase 84 basis points. The lower net expenses on your AmSouth Fund are a result of voluntary expense limitations that may be discontinued at any time. AmSouth Bank and its affiliates have informed the trustees that they will discontinue their expense limitations in the future. The trustees considered the positive factors associated with the Reorganization, such as greater fund assets and potential for growth, to outweigh the negative factors, such as the increase in net expenses for the Class B shares. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduce per share expenses.
Fifth, the substantially larger size of the combined Pioneer Cash Reserves Fund will offer greater opportunity for diversification of the investment portfolio, which should help to reduce risks.
Sixth, the Class A, B and Y shares of Pioneer Cash Reserves Fund received in the Reorganization will provide AmSouth Prime Money Market Fund shareholders with exposure to substantially the same investment product as they currently have.
Seventh, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the AmSouth Funds' proxy statements and solicitation costs incurred by the AmSouth Funds in connection with the Reorganization. AAMI will otherwise be responsible for all costs and expenses of the AmSouth Funds in connection with the Reorganizations.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005. The table also sets forth the pro forma capitalization of the combined Fund as of May 31, 2005, assuming the shareholders of AmSouth Treasury Reserve Money Market Fund approve the reorganization of their fund into Pioneer Cash Reserves Fund.
--------------------------------------------------------------------------------------------------------------------------------
Pro Forma
Pioneer Cash
Reserves Fund
(including
AmSouth
AmSouth Prime Pioneer Cash Pro Forma Treasury
Money Market Reserves Pioneer Cash Reserve Money
Fund Fund Reserves Fund Market Fund)
May 31, 2005 May 31, 2005 May 31, 2005 May 31, 2005
--------------------------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $627,598 $418,881 $1,047,479 $1,226,225
--------------------------------------------------------------------------------------------------------------------------------
Class A shares .......................................... $412,843 $212,426 $625,268 $698,111
--------------------------------------------------------------------------------------------------------------------------------
Class B shares .......................................... $3,150 $50,365 $53,515 $53,515
--------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ........................................ $211,605 N/A $211,605 $317,508
--------------------------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
--------------------------------------------------------------------------------------------------------------------------------
Class A shares .......................................... $1.00 $1.00 $1.00 $1.00
--------------------------------------------------------------------------------------------------------------------------------
Class B shares .......................................... $1.00 $1.00 $1.00 $1.00
--------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ........................................ $1.00 N/A $1.00 $1.00
--------------------------------------------------------------------------------------------------------------------------------
Shares Outstanding
--------------------------------------------------------------------------------------------------------------------------------
Class A shares .......................................... 412,880,561 212,571,273 625,697,409 698,590,414
--------------------------------------------------------------------------------------------------------------------------------
Class B shares .......................................... 3,149,507 50,321,650 53,468,483 53,468,483
--------------------------------------------------------------------------------------------------------------------------------
Class I/Y shares ........................................ 211,594,967 N/A 211,594,967 317,725,662
--------------------------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Tax-Exempt Money Market Fund and Pioneer Tax Free Money Market Fund
PROPOSAL 1(v)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-1, because it contains details that are not in the summary.
Each Fund is a money market fund that may invest in high quality short-term instruments that are exempt from regular federal income tax. Consequently, the policies and risks of each Fund are similar. A portion of the income from Pioneer Tax Free Money Market Fund may be a preference item for purposes of the federal alternative minimum tax. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Tax-Exempt Money Market Fund to Pioneer Tax Free Money Market Fund
---------------------------------------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund Pioneer Tax Free Money Market Fund
---------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an A diversified series of Pioneer Series Trust
open-end management investment company II, an open-end management investment company
organized as a Massachusetts business trust. organized as a Delaware statutory trust.
---------------------------------------------------------------------------------------------------------------------------
Net assets as of March 31, $141.4 million $34.8 million
2005
---------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment Adviser: Investment Adviser:
portfolio managers AAMI Pioneer
Portfolio Manager: Portfolio Manager:
Day-to-day management of AmSouth Tax-Exempt Day-to-day management of the Fund's portfolio
Money Market Fund's portfolio is the is the responsibility of Kenneth J. Taubes.
responsibility of a team of AAMI's portfolio Mr. Taubes joined Pioneer as a senior vice
managers, and no person is primarily president in 1998 and has been an investment
responsible for making recommendations to the professional since 1982.
team.
---------------------------------------------------------------------------------------------------------------------------
Investment objective AmSouth Tax-Exempt Money Market Fund seeks to Pioneer Tax Free Money Market Fund seeks as
provide investors with as high a level of high a level of current income exempt from
current interest income exempt from federal federal income tax as is consistent with a
income tax as is consistent with the portfolio of high-quality, short-term
preservation of capital and relative municipal obligations selected on the basis
stability of principal. of liquidity and preservation of capital.
---------------------------------------------------------------------------------------------------------------------------
Primary investments AmSouth Tax-Exempt Money Market Fund under The Pioneer Tax Free Money Market Fund seeks
normal market conditions will invest at least to maintain a constant net asset value of
80% of the Fund's total assets in municipal $1.00 per share by investing, under normal
securities and in securities of money market circumstances, at least 80% of its assets in
mutual funds that invest primarily in high-quality, money market securities that
obligations the interest on which is exempt pay interest that is exempt from regular
from federal income tax. federal income tax. These investments include
bonds, notes and other debt instruments
The Fund will invest only in those municipal issued by or on behalf of states, counties,
municipalities,
---------------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund Pioneer Tax Free Money Market Fund
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
securities and other obligations that are territories and possessions of the United
considered by AAMI to present minimal credit States and the District of Columbia and their
risks. In addition, investments will be authorities, political subdivisions, agencies
limited to those obligations that, at the or instrumentalities. The Fund will not
time of purchase, (i) possess one of the two invest in securities whose interest is
highest short-term ratings from an NRSRO in subject to the alternative minimum tax for
the case of single-rated securities or (ii) non-corporate taxpayers.
possess, in the case of multiple-rated
securities, one of the two highest short-term The Fund may only invest in money market
ratings by at least two NRSROs; or (iii) do instruments that are permissible investments
not possess a rating (i.e., are unrated) but for a money market fund under the rules of
are determined by AAMI to be of comparable the Securities and Exchange Commission. The
quality to the rated instruments eligible for Fund invests exclusively in U.S. dollar
purchase by the Fund under the guidelines denominated securities with a maximum
adopted by the Board. remaining maturity of 397 days and maintains
a dollar-weighted average portfolio maturity
The Fund may invest up to 10% of its total of 90 days or less. The Fund's investments
assets in the securities of money market may have fixed, floating or variable interest
mutual funds that invest primarily in rates.
obligations exempt from federal income tax.
---------------------------------------------------------------------------------------------------------------------------
Other investments The Fund invests primarily in short-term In selecting the Fund's portfolio, Pioneer
municipal securities that provide income that complies with the rating, maturity and
is exempt from federal income tax and is not diversification requirements applicable to
a tax preference item for purposes of the money market funds. Within those limits,
federal alternative minimum tax. Short-term Pioneer's assessment of broad economic
municipal securities are debt obligations, factors that are expected to affect economic
such as bonds and notes, issued by states, activity and interest rates influence its
territories, and possessions of the United securities selection. Pioneer also employs
States and their political subdivisions, due diligence and fundamental research, an
agencies, and instrumentalities, which evaluation of the issuer based on its
generally have remaining maturities of one financial statements and operations, to
year or less. Municipal securities purchased assess an issuer's credit quality.
by the Fund may include rated and unrated
variable and floating rate tax-exempt notes
which may have a stated maturity in excess of
one year but which will be subject to a
demand feature permitting the Fund to demand
payment within a year.
When selecting securities for the Fund's
portfolio, AAMI first considers safety of
principal and the quality of an investment.
AAMI then focuses on generating a high level
of income. AAMI generally evaluates
investments based on interest rate
sensitivity selecting those securities whose
maturities fit the Fund's interest rate
sensitivity target and which AAMI believes to
be the best relative values.
The Fund will maintain an average weighted
portfolio maturity of 90 days or less and
will limit the maturity of each security in
its portfolio to 397 days or less.
---------------------------------------------------------------------------------------------------------------------------
|
----------------------------------------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund Pioneer Tax Free Money Market Fund
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
Other investments The Fund may invest up to 20% of its total The Fund may invest up to 20% of its net
assets in taxable obligations. Taxable assets in U.S. dollar denominated securities
obligations may include obligations issued or issued by non-U.S. entities, such as non-U.S.
guaranteed by the U.S. government, its banks and corporate issuers.
agencies or instrumentalities (some of which
may be subject to repurchase agreements), The Fund's investment in municipal securities
certificates of deposit and bankers' whose issuers are located in the same state
acceptances of selected banks, and commercial will not exceed 25% of the Fund's total
paper. assets.
The Fund invests in money market securities
rated in one of the two highest rating
categories for short-term debt by a
nationally recognized statistical rating
organization or, if unrated, determined to be
of equivalent credit quality by Pioneer. If
rating organizations differ in the rating
assigned to a security, the Fund will only
treat the security as having the higher
rating if at least two rating organizations
assigned that rating. If a rating
organization downgrades the quality rating
assigned to one or more of the Fund's
portfolio securities, Pioneer will promptly
reassess whether the downgraded security
presents minimal credit risk to the Fund.
----------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is subject to the diversification requirements applicable to money market funds
under the Investment Company Act.
----------------------------------------------------------------------------------------------------------------------------
Industry concentration AmSouth Tax-Exempt Money Market Fund may not Pioneer Tax Free Money Market Fund may not
purchase any securities which would cause 25% invest 25% or more of the value of its total
or more of the Fund's total assets at the assets in any one industry, provided that
time of purchase to be invested in securities this limitation does not apply to municipal
of one or more issuers conducting their securities other than those municipal
principal business activities in the same securities backed only by assets and revenues
industry. This Limitation shall not apply to of non-governmental issuers. For purposes of
municipal securities; and for purposes of applying the limitation set forth in this
this limitation, private activity bonds that restriction, securities of the U.S.
are backed only by the assets and revenues of government, its agencies, or
a non-governmental user shall not be deemed instrumentalities, and securities backed by
to be municipal securities. the credit of a governmental entity are not
considered to represent industries. However,
obligations backed only by the assets and
revenues of non-governmental issuers may for
this purpose be deemed to be issued by such
non-governmental issuers. Thus, the 25%
limitation would apply to such obligations.
----------------------------------------------------------------------------------------------------------------------------
Restricted and illiquid AmSouth Tax-Exempt Money Market Fund may not Pioneer Tax Free Money Market Fund will not
securities invest more than 10% of its net assets in invest more than 10% of its net assets in
securities that are restricted as to resale, illiquid and other securities that are not
or for which no readily available market readily marketable. Repurchase agreements
exists, including repurchase agreements maturing in more than seven days will be
providing for settlement more than seven days included for purposes of the foregoing limit.
after notice.
----------------------------------------------------------------------------------------------------------------------------
|
----------------------------------------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund Pioneer Tax Free Money Market Fund
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Tax-Exempt Money Market Fund may not Pioneer Tax Free Money Market Fund may not
borrow money or issue senior securities, borrow money, except on a temporary basis and
except the Fund may borrow from banks or to the extent permitted by applicable law, as
enter into reverse repurchase agreements for amended and interpreted or modified from time
temporary emergency purposes in amounts up to to time by any regulatory authority having
33 1/3% of the value of its total assets at jurisdiction. Under current regulatory
the time of such borrowing. The Fund will not requirements, a fund may: (a) borrow from
purchase securities while borrowings banks or through reverse repurchase
(including reverse repurchase agreements) in agreements in an amount up to 33 1/3% of the
excess of 5% of its total assets are fund's total assets (including the amount
outstanding. In addition, the Fund is borrowed); (b) borrow up to an additional 5%
permitted to participate in a credit facility of the fund's assets for temporary purposes;
whereby the Fund may directly lend to and (c) obtain such short-term credits as are
borrow money from other AmSouth funds for necessary for the clearance of portfolio
temporary purposes, provided that the loans transactions; (d) purchase securities on
are made in accordance with an order of margin to the extent permitted by applicable
exemption from the SEC and any conditions law; and (e) engage in transactions in
thereto. mortgage dollar rolls that are accounted for
as financings. In the opinion of the SEC, the
Fund's limitation on borrowing includes any
pledge, mortgage or hypothecation of its
assets.
----------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Tax-Exempt Money Market Fund may not Pioneer Tax Free Money Market Fund may not
make loans, except that the Fund may purchase make loans, except that the fund may (i) lend
or hold debt instruments in accordance with portfolio securities in accordance with the
its investment objective and policies, lend fund's investment policies, (ii) enter into
Fund securities in accordance with its repurchase agreements, (iii) purchase all or
investment objective and policies and enter a portion of an issue of publicly distributed
into repurchase agreements. In addition, the debt securities, bank loan participation
Fund is permitted to participate in a credit interests, bank certificates of deposit,
facility whereby the Fund may directly lend to bankers' acceptances, debentures or other
and borrow money from other AmSouth Funds for securities, whether or not the purchase is
temporary purposes, provided that the loans made upon the original issuance of the
are made in accordance with an order of securities, (iv) participate in a credit
exemption from the SEC and any conditions facility whereby the fund may directly lend
thereto. to and borrow money from other affiliated
funds to the extent permitted under the 1940
Act or an exemption therefrom, and (v) make
loans in any other manner consistent with
applicable law, as amended and interpreted or
modified from time to time by any regulatory
authority having jurisdiction.
----------------------------------------------------------------------------------------------------------------------------
Derivative instruments AmSouth Tax-Exempt Money Market Fund may not Pioneer Tax Free Money Market Fund may use
write or purchase call options futures and options on securities, indices
and currencies, forward currency exchange
contracts and other derivatives. The Fund
does not use derivatives as a primary
investment technique and generally limits
their use to hedging. However, the Fund may
use derivatives for a variety of
non-principal purposes, including as a hedge
against adverse changes in stock market
prices, interest rates
----------------------------------------------------------------------------------------------------------------------------
|
----------------------------------------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund Pioneer Tax Free Money Market Fund
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
or currency exchange rates, as a substitute
for purchasing or selling securities, and to
increase the Fund's return as a non-hedging
strategy that may be considered speculative.
----------------------------------------------------------------------------------------------------------------------------
Other investment policies As described above, the Funds have substantially similar principal investment strategies
and restrictions and policies. Certain of the non-principal investment policies and restrictions are
different. For a more complete discussion of each Fund's other investment policies and
fundamental and non-fundamental investment restrictions, see the SAI.
----------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
----------------------------------------------------------------------------------------------------------------------------
Class A sales charges and Class A shares are offered without sales Class A shares are offered without sales
Rule 12b-1 fees charges. charges.
Class A shares pay a shareholder servicing fee There is no contingent deferred sales charge
(non 12b-1) up to 0.25% of average daily net ("CSDC"), except in certain circumstances when
assets. the initial sales charge is waived. Class A
shares are subject to distribution and service
AmSouth Tax-Exempt Money Market Fund does not (12b-1) fees of up to 0.15% of average daily
offer Class B shares. net assets.
----------------------------------------------------------------------------------------------------------------------------
Class I and Class Y AmSouth Tax-Exempt Money Market Fund does not The Fund does not impose any initial,
sales charges and impose any initial or contingent deferred contingent deferred or asset based sales
Rule 12b-1 fees sales charge on Class I shares are offered charge on Class Y shares.
without sales charges.
The distributor incurs the expenses of
The Fund may impose a shareholder servicing distributing the Fund's Class Y shares, none
fee (non 12b-1) of up to 0.15% of average of which are reimbursed by the Fund or the
daily net assets. Class Y shareowners.
----------------------------------------------------------------------------------------------------------------------------
Management and other fees AmSouth Tax-Exempt Money Market Fund pays an Pioneer Tax Free Money Market Fund pays
advisory fee on a monthly basis at an annual Pioneer an annual fee equal to 0.40% of the
rate of 0.40% of the Fund's average daily net Fund's average daily net assets. The fee is
assets. computed daily and paid monthly.
ASO Services Company, Inc. ("ASO") serves as Pioneer has agreed to limit the Fund's
administrator and fund accounting agent for expenses or waive a portion of its management
the Fund. The Fund pays ASO an administrative fee to maintain a net asset value of $1.000.
services fee of 0.15% of the Fund's average Under certain circumstances, this limitation
daily net assets. may result in a 0.00% yield for one or more
classes for shares. From time to time,
Other expenses of the Fund are being limited Pioneer and its affiliates may limit the
to 0.12% for Class A shares. Any fee waiver expenses of one or more classes for the
or expense reimbursement arrangement is purpose of increasing its yield during the
voluntary and may be discontinued at any period of the limitation. These expense
time. limitation policies are voluntary and
temporary and may be revised or terminated by
Other expenses of the Fund are being limited Pioneer at any time without notice.
to 0.12% for Class I shares. Any fee waiver
or expense reimbursement arrangement is For the fiscal year ended December 31, 2004,
voluntary and may be discontinued at any the Fund's annual operating expenses for
time. Class A shares were 0.94% of average daily
For the fiscal year ended July 31, 2004, the
----------------------------------------------------------------------------------------------------------------------------
|
----------------------------------------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund Pioneer Tax Free Money Market Fund
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
Fund's annual operating expenses for Class A net assets.
shares, after giving effect to the expense
limitation were 0.52%, and without giving Class Y shares of Pioneer Tax Free Money
effect to the expense limitation, were 0.89% Market Fund are being offered for the first
of average daily net assets. time in connection with the Reorganization.
For the fiscal year ended July 31, 2004, the
Fund's annual operating expenses for Class I
shares, after giving effect to the expense
limitation were 0.52%, and without giving
effect to the expense limitation, were 0.79%
of average daily net assets.
----------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of AmSouth Tax-Exempt Money You may buy shares from any investment firm
Market Fund directly through BISYS Fund that has a sales agreement with PFD, the
Services, the Fund's distributor, or through Fund's distributor.
brokers, registered investment advisers, banks
and other financial institutions that have If the account is established in the
entered into selling agreements with the shareholder's own name, shareholders may also
Fund's distributor, as described in the Fund's purchase additional shares of the Pioneer Fund
prospectus. by telephone or online.
Certain account transactions may be done by
telephone.
----------------------------------------------------------------------------------------------------------------------------
Exchanging shares You can exchange your shares in the Fund for You may exchange your shares for shares of
shares of the same class of another AmSouth the same class of another Pioneer mutual
fund, usually without paying additional sales fund. Your exchange request must be for at
charges. You must meet the minimum investment least $1,000. The Fund allows you to exchange
requirements for the Fund into which you are your shares at net asset value without
exchanging. Exchanges from one fund to charging you either an initial or contingent
another are taxable. Class A shares may be deferred shares charge at the time of the
exchanged for Class I shares of the same Fund exchange. Shares you acquire as part of an
or another AmSouth fund if you become exchange will continue to be subject to any
eligible to purchase Class I shares. Class I contingent deferred sales charge that applies
shares may be exchanged for Class A shares of to the shares you originally purchased. When
the same fund. No transaction fees are you ultimately sell your shares, the date of
currently charged for exchanges. your original purchase will determine your
contingent deferred sales charge. An exchange
generally is treated as a sale and a new
purchase of shares for federal income tax
purposes.
After you establish an eligible fund account,
you can exchange Fund shares by telephone or
online.
----------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the
Fund receives your request in good order.
----------------------------------------------------------------------------------------------------------------------------
|
----------------------------------------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund Pioneer Tax Free Money Market Fund
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
----------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. Even though each Fund seeks to maintain a $1 share price, you could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o New federal or state legislation adversely affects the tax-exempt status of securities held by the Fund or the financial ability of an issuer to repay financial obligations
o The issuer of a security owned by the Fund may not be able to make timely payments because of a general economic downturn or increased governmental costs
o The adviser's judgment about the credit quality, attractiveness or relative value of a particular security proves to be incorrect
Past Performance
Set forth below is performance information for each Fund. The bar charts show how each Fund's total return has varied from year to year for each full calendar year. The table shows average annual total return for each Fund over time for each class of shares compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in each Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance does not indicate future results. No Class Y shares of Pioneer Tax Exempt Money Market Fund are currently outstanding.
AmSouth Tax-Exempt Money Market Fund -- Class A Calendar Year Total Returns*
[The following table was depicted as a bar chart in the printed material.]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 3.44 2.95 3.1 2.89 2.72 3.35 1.91 0.64 0.34 0.58 |
* During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 0.91% for the quarter ended June 30, 1995, and the lowest quarterly return was 0.06% for the quarter ended September 30, 2003. Performance for Class A shares, which were first offered on April 1, 1996, is based on the historical performance of the Class I shares prior to that date.
Pioneer Tax Free Money Market Fund -- Class A Shares Calendar Year Total Returns*
[The following table was depicted as a bar chart in the printed material.]
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 3.54 3.07 3.12 3.07 2.77 3.52 2.34 0.97 0.51 0.58 |
* During the period shown in the bar chart, Pioneer Tax Free Money Market Fund's highest quarterly return was 0.94% for the quarter ended June 30, 2000, and the lowest quarterly return was 0.09% for the quarter ended March 31, 2004.
Pursuant to an agreement and plan of reorganization, Pioneer Tax Exempt Money Market Fund acquired all of the assets and those liabilities reflected in the net assets of Safeco Tax-Free Money Free Money Market Fund (the predecessor fund) on December 10, 2004. In the reorganization, the predecessor fund exchanged all of its assets for Investor Class shares of the Pioneer Fund. The predecessor fund offered an Investor Class and other classes of shares similar to the Fund's Class A, B and C shares. As a result of the reorganization, Pioneer Tax Exempt Money Market Fund is the accounting successor of the predecessor fund. The predecessor fund operated as a registered investment company like the Fund. The performance of each class of the Fund includes the performance of the predecessor fund's Class A and Class B shares prior to the reorganization, which has been restated to reflect differences in any applicable sales charges. If all the expenses of Pioneer Tax Exempt Money Market Fund were reflected, the performance would be lower. Since August 2, 2004, Pioneer has served as the predecessor fund's investment adviser. Safeco Asset Management, Inc. previously served as the predecessor fund's investment adviser. The Fund's Investor Class shares are not offered in the reorganization.
AmSouth Tax-Exempt Money Market Fund Average Annual Total Returns as of December 31, 2004
-------------------------------------------------------------------------------------------
1 Year 5 Years 10 Years
-------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund, Class A Shares
-------------------------------------------------------------------------------------------
Return Before Taxes(1) 0.56% 1.35% 2.18%
-------------------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund, Class I Shares
-------------------------------------------------------------------------------------------
Return Before Taxes(2) 0.56% 1.45% 2.27%
-------------------------------------------------------------------------------------------
|
(1) The return reported above assumes the reinvestment of dividends. Performance for Class A shares, which were first offered on April 1, 1996, is based on the historical performance of the Class I shares prior to that date
(2) The return reported above assumes the reinvestment of dividends.
Pioneer Tax Free Money Market Fund Average Annual Total Returns as of December 31, 2004(1)
---------------------------------------------------------------------------------------------------
1 Year 5 Years Since Inception
---------------------------------------------------------------------------------------------------
Pioneer Tax Free Money Market Fund, Class A shares
---------------------------------------------------------------------------------------------------
Return Before Taxes(2) 0.58% 1.58% 3.27% (9/18/84)
---------------------------------------------------------------------------------------------------
Return After Taxes on Distributions 0.38% 0.97% 2.04%
---------------------------------------------------------------------------------------------------
Return After Taxes on Distributions and Sale of
Fund Shares 0.38% 0.97% 2.04%
---------------------------------------------------------------------------------------------------
Lipper Tax-Exempt Money Market Average(3) 0.67% 1.64% 3.30% (9/18/84)
(reflects no deduction for taxes)
---------------------------------------------------------------------------------------------------
|
(1) Rejects the inception dates of the predecessor fund. Inception of Class A shares was December 13, 2004(.)
(2) Return before taxes assumes that you sell your Class A shares at the end of the period and that you reinvest all of your dividends and distributions.
(3) The Lehman Brothers Municipal Bond Index, an unmanaged index that is a broad measure of the municipal bond market, is for reference only, does not mirror the Fund's investments, and reflects no deduction for fees, expenses or taxes.
The following table shows the tax effective yield of each Fund:
---------------------------------------------------------------------------------
7-Day Tax Effective Yield
As of December 31, 2004
---------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund, Class A Shares 1.30%
---------------------------------------------------------------------------------
Pioneer Tax Free Money Market Fund, Class A Shares 1.28%
---------------------------------------------------------------------------------
AmSouth Tax-Exempt Money Market Fund, Class I Shares 1.30%
---------------------------------------------------------------------------------
|
The most recent portfolio manager's discussion of each Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The tables below show the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the tables appearing below are based on (i) for the AmSouth Tax-Exempt Money Market Fund, the expenses of AmSouth Tax-Exempt Money Market Fund for the period ended January 31, 2005 and (ii) for the Pioneer Tax Free Money Market Fund, the expenses of Pioneer Tax Free Money Market Fund for the period ended December 31, 2004. Future expenses for all share classes may be greater or less. The tables also show the pro forma expenses of the combined Fund assuming the Reorganization occurred on December 31, 2004.
-------------------------------------------------------------------------------------------------------------- Shareholder AmSouth Pioneer AmSouth transaction fees Tax-Exempt Tax Free Combined Tax-Exempt Combined (paid directly Money Market Money Market Fund Money Market Fund from your Fund (1) Fund (Pro Forma) Fund (1) (Pro Forma) investment) Class A Class A Class A Class I Class Y (7) -------------------------------------------------------------------------------------------------------------- Maximum sales charge None None None None None (load) when you buy shares as a percentage of offering price -------------------------------------------------------------------------------------------------------------- Maximum deferred sales charge (load) as a percentage of purchase price or the amount None None None None None you receive when you sell shares, whichever is less -------------------------------------------------------------------------------------------------------------- |
-------------------------------------------------------------------------------------------------------------- Shareholder AmSouth Pioneer AmSouth transaction fees Tax-Exempt Tax Free Combined Tax-Exempt Combined (paid directly Money Market Money Market Fund Money Market Fund from your Fund (1) Fund (Pro Forma) Fund (1) (Pro Forma) investment) Class A Class A Class A Class I Class Y (7) -------------------------------------------------------------------------------------------------------------- when you sell shares, whichever is less -------------------------------------------------------------------------------------------------------------- Redemption fees None(2) None None None(2) None -------------------------------------------------------------------------------------------------------------- Annual fund operating expenses (deducted from fund assets) (as a % of average net assets) -------------------------------------------------------------------------------------------------------------- Management fee 0.40% 0.40% 0.40% 0.40% 0.40% -------------------------------------------------------------------------------------------------------------- Distribution and None 0.15% 0.15% None None service (12b-1) fee -------------------------------------------------------------------------------------------------------------- Other expenses 0.57%(3) 0.62%(4) 0.11% 0.45%(5) 0.11% -------------------------------------------------------------------------------------------------------------- Total fund operating 0.97% 1.17%(6) 0.66% 0.85%(6) 0.51%(6) expenses -------------------------------------------------------------------------------------------------------------- Expense 0.38% 0.23% 0.00% 0.25% 0.00% reimbursement/reduction -------------------------------------------------------------------------------------------------------------- Net fund operating 0.59% 0.94% 0.66% 0.60% 0.51% expenses -------------------------------------------------------------------------------------------------------------- |
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(3) Other expenses for your AmSouth Fund are being limited to 0.12% for Class A shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(4) Other expenses for the Pioneer Fund are based on estimated amounts for the current fiscal year.
(5) Other expenses for your AmSouth Fund are being limited to 0.19% for Class A shares and 0.20% for Class I shares. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(6) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(7) Class Y shares of Pioneer Tax Free Money Market Fund are being offered for the first time in connection with the Reorganization.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, and (d) each Fund's operating expenses remain the same. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
----------------------------------------------------------------------------------------------------- Number of years you AmSouth Tax-Exempt Money Pioneer Tax Free Money Market Combined Fund own your shares Market Fund Fund (Pro Forma) ----------------------------------------------------------------------------------------------------- Class A ----------------------------------------------------------------------------------------------------- Year 1 $99 $89 $639 ----------------------------------------------------------------------------------------------------- Year 3 $309 $278 $774 ----------------------------------------------------------------------------------------------------- Year 5 $536 $482 $922 ----------------------------------------------------------------------------------------------------- |
-----------------------------------------------------------------------------------------------------
Year 10 $1,190 $1,073 $1,350
-----------------------------------------------------------------------------------------------------
Class I Class Y
-----------------------------------------------------------------------------------------------------
Year 1 $87 N/A $52
-----------------------------------------------------------------------------------------------------
Year 3 $271 N/A $164
-----------------------------------------------------------------------------------------------------
Year 5 $471 N/A $285
-----------------------------------------------------------------------------------------------------
Year 10 $1049 N/A $640
-----------------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Tax-Exempt Money Market Fund and its shareholders. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to your AmSouth Fund informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the long-term historical investment performance of Pioneer Tax Free Money Market Fund is superior to your AmSouth Fund's investment performance. For the one and five year periods ended December 31, 2004, Class A shares of Pioneer Tax Free Money Market Fund had an average annual return of 0.47% (one year) and 6.99% (five year), compared to an average annual return of the Class A shares of your AmSouth Fund of 0.56% (one year) and 1.35% (five year), respectively, during the same period. In addition, the Trustees considered the track record of Pioneer in managing equity and fixed income mutual funds.
Third, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges.
Fourth, Pioneer Tax Free Money Market Fund's management fee (0.40% of average daily net assets) is the same as the advisory fee of your AmSouth Fund (0.40% of average daily net assets). The historical expenses attributable to the Class A shares of the Pioneer Fund are higher than your Fund's Class A shares, on both a gross and net basis. On a pro forma basis, the gross expenses of the Pioneer Fund attributable to Class A expenses are estimated to be lower than your Fund's gross expenses; however, your Fund's net expenses attributable to Class A expenses are estimated to be lower than the pro forma net expenses attributable to Class A shares. However, AAMI has advised your Trustees that it will discontinue the expense limitation in the future. With respect to Class Y shares, the pro forma gross and net expenses of the Pioneer Fund are lower than the gross and net expenses of the Class I shares of your Fund. The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by the Class A and Class B shares of both Funds are the same. Moreover, your AmSouth Fund's Class I shares pay a non 12b-1 shareholder servicing fee that is not paid by the Pioneer Fund's Class Y shares. In addition, the broader distribution arrangements of the Pioneer Fund offer greater potential for further asset growth and reduced per share expenses.
Fifth the Class A shares of Pioneer Tax Free Money Market Fund received in the Reorganization will provide AmSouth Tax-Exempt Money Market Fund shareholders with exposure to substantially the same investment product as they currently have.
Sixth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the AmSouth Funds' proxy statements and solicitation costs incurred by the AmSouth Funds in connection with the Reorganization. AAMI will otherwise be responsible of all costs and expenses of the AmSouth Funds in connection with the Reorganization.
The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of each Fund as of May 31, 2005, and the pro forma combined Fund as of May 31, 2005.
--------------------------------------------------------------------------------------------------------------
AmSouth Pioneer Tax Pro Forma
Tax-Exempt Free Money Pioneer Tax
Money Market Market Free Money
Fund Fund Market Fund
May 31, 2005 May 31, 2005 May 31, 2005
--------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $142,574 $33,656 $176,230
--------------------------------------------------------------------------------------------------------------
Class A shares .......................................... $31,543 $1,165 $32,707
--------------------------------------------------------------------------------------------------------------
Class B shares .......................................... N/A N/A N/A
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ........................................ $111,031 N/A $111,031
--------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
--------------------------------------------------------------------------------------------------------------
Class A shares .......................................... $1.00 $1.00 $1.00
--------------------------------------------------------------------------------------------------------------
Class B shares .......................................... N/A N/A N/A
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ........................................ $1.00 N/A $1.00
--------------------------------------------------------------------------------------------------------------
Shares Outstanding
--------------------------------------------------------------------------------------------------------------
Class A shares .......................................... 31,604,005 1,164,667 32,707,656
--------------------------------------------------------------------------------------------------------------
Class B shares .......................................... N/A N/A N/A
--------------------------------------------------------------------------------------------------------------
Class I/Y shares ........................................ 111,276,485 N/A 111,276,485
--------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
AmSouth Institutional Prime Obligations Money Market Fund and Pioneer Institutional Money Market Fund
PROPOSAL 1(w)
Approval of Agreement and Plan of Reorganization
SUMMARY
The following is a summary of more complete information appearing later in this Proxy Statement/Prospectus or incorporated herein. You should read carefully the entire Proxy Statement/Prospectus, including the form of Agreement and Plan of Reorganization attached as EXHIBIT A-2, because it contains details that are not in the summary.
Each Fund is a money market fund that may invest in high quality short-term instruments. Consequently, the policies and risks of each Fund are similar. In the table below, if a row extends across the entire table, the policy disclosed applies to both your AmSouth Fund and the Pioneer Fund.
Comparison of AmSouth Institutional Prime Obligations Money Market Fund to Pioneer Institutional Money Market Fund
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Institutional Prime Obligations
Money Market Fund Pioneer Institutional Money Market Fund
---------------------------------------------------------------------------------------------------------------------------------
Business A diversified series of AmSouth Funds, an open-end A
newly created diversified series of Pioneer management
investment company organized as a Series Trust IV, an
open-end management investment Massachusetts business
trust. company organized as a Delaware statutory trust.
---------------------------------------------------------------------------------------------------------------------------------
Net assets as of $ 379.2 million None. Pioneer Institutional Money Market Fund is
March 31, 2005 newly created and does not expect to commence
investment operations until the Reorganization
occurs.
---------------------------------------------------------------------------------------------------------------------------------
Investment advisers Investment Adviser: Investment Adviser:
and portfolio AAMI Pioneer
managers
Portfolio Manager: Portfolio Manager:
Day-to-day management of AmSouth Institutional Prime Day-to-day management of the Fund's portfolio
Obligations Money Market Fund is the responsibility is the responsibility of Andrew Feltus. Mr.
of a team of AAMI's portfolio managers, and no Feltus is supported by the fixed income team.
person is primarily responsible for making Members of this team manage other Pioneer
recommendations to the team. funds investing primarily in fixed income
securities. The portfolio manager and the
team also may draw upon the research and
investment management expertise of the global
research team, which provides fundamental
research on companies and includes members
from Pioneer's affiliate, Pioneer Investment
Management Limited. Mr. Feltus, a vice
president, joined Pioneer in 1994 and has
been an investment professional for more than
10 years.
---------------------------------------------------------------------------------------------------------------------------------
Investment objective Each Fund seeks high current income with preservation of capital and liquidity.
---------------------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Institutional Prime Obligations
Money Market Fund Pioneer Institutional Money Market Fund
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
Primary investments The AmSouth Fund invests only in U.S. The Fund seeks to maintain a constant net asset
dollar-denominated, "high-quality" short-term debt value of $1.00 per share by investing in
securities, including obligations issued or high-quality, U.S. dollar denominated money market
guaranteed by the U.S. government, its agencies or securities, including those issued by:
instrumentalities, certificates of deposit, time o U.S. and foreign banks
deposits, bankers' acceptances and other o U.S. and foreign corporate issuers
short-term securities issued by domestic or o The U.S. government and its agencies and
foreign banks or their subsidiaries or branches, instrumentalities
domestic and foreign commercial paper and other o Foreign governments
short-term corporate debt obligations, including o Multinational organizations such as the
those with floating or variable rates of interest, World Bank
obligations issued or guaranteed by one or more
foreign governments or their agencies or
instrumentalities, including obligations of
supranational entities, asset-backed securities,
and repurchase agreements collateralized by the
types of securities listed above.
---------------------------------------------------------------------------------------------------------------------------------
Investment strategies When selecting securities for the Fund's The Fund may invest more than 25% of its
portfolio, AAMI first considers safety of total assets in U.S. government securities
principal and the quality of an investment. AAMI and obligations of U.S. banks. The Fund may
then focuses on generating a high level of income. invest in any money market instrument that is
AAMI generally evaluates investments based on a permissible investment for a money market
interest rate sensitivity selecting those fund under the rules of the Securities and
securities whose maturities fit the Fund's Exchange Commission, including commercial
interest rate sensitivity target and which the paper, certificates of deposit, time
adviser believes to be the best relative values. deposits, bankers' acceptances,
The Fund will maintain an average weighted mortgage-backed and asset-backed securities,
portfolio maturity of 90 days or less and will repurchase agreements, municipal obligations
limit the maturity of each security in its and other short-term debt securities.
portfolio to 397 days or less.
The Fund invests in U.S. government
The Fund invests in securities issued by: (i) obligations and money market securities rated
FNMA, FHLMC, SLMA and the FHLBs, in one of the two highest rating categories
which are supported by the right of the issuer to for short-term debt by a nationally
borrow from the U.S. Treasury; and (ii) FFCBs recognized statistical rating organization
which is supported only by the credit of the or, if unrated, determined to be of
issuer. The Fund also invests in mortgage-related equivalent credit quality by Pioneer. If
securities issued by nongovernmental entities rating organizations differ in the rating
which are rated, at the time of purchase, in one assigned to a security, the Fund will only
of the four highest rating categories by an NRSRO treat the security as having the higher
or, if unrated, determined by its Advisor to be of rating if at least two rating organizations
comparable quality. "High-quality" debt assigned that rating. If a rating
securities are those obligations which, at the organization downgrades the quality rating
time of purchase, (i) possess the highest assigned to one or more of the Fund's
short-term rating from at least two NRSROs (for portfolio securities, Pioneer will promptly
example, reassess whether the downgraded security
commercial paper rated "A-1" by S&P, and "P-1" by presents minimal credit risk to the Fund.
Moody's Investors Service, Inc.
("Moody's")) or one NRSRO if only rated by one The Fund invests exclusively in securities
NRSRO or (ii) if unrated, are determined by AAMI with a maximum remaining maturity of 397 days
to be of comparable quality. and maintains a dollar-weighted average
portfolio maturity of 90 days or less. The
Fund's investments may have fixed, floating
or variable interest rates.
At times, more than 25% of the Fund's assets
may be invested in the same market segment,
such as
---------------------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Institutional Prime Obligations
Money Market Fund Pioneer Institutional Money Market Fund
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
financials. To the extent the Fund emphasizes
investments in a market segment, the Fund
will be subject to a greater degree to the
risks particular to the industries in that
segment, and may experience greater market
fluctuation, than a Fund without the same
focus. For example, industries in the
financial segment, such as banks, insurance
companies, broker-dealers and REITs, may be
sensitive to changes in interest rates and
general economic activity and are subject to
extensive government regulation.
In selecting the Fund's portfolio, Pioneer
complies with the rating, maturity and
diversification requirements applicable to
money market funds. Within those limits,
Pioneer's assessment of broad economic
factors that are expected to affect economic
activity and interest rates influence its
securities selection. Pioneer also employs
due diligence and fundamental research, an
evaluation of the issuer based on its
financial statements and operations, to
assess an issuer's credit quality.
---------------------------------------------------------------------------------------------------------------------------------
Temporary defensive Pioneer Cash Reserves Fund may invest all or part
strategies of its assets in securities with remaining
maturities of less than one year, cash
equivalents or may hold cash.
---------------------------------------------------------------------------------------------------------------------------------
Diversification Each Fund is subject to the diversification requirements applicable to money market funds
under the Investment Company Act.
---------------------------------------------------------------------------------------------------------------------------------
Industry AmSouth Institutional Prime Obligations Money Pioneer Institutional Money Market Fund may not
concentration Market Fund may not purchase any securities which concentrate its investments in a particular
would cause more than 25% of the value of the industry. The Fund would be concentrating if it
Fund's total assets at the time of purchase to be invested more than 25% of its assets in the
invested in securities of one or more issuers securities of issuers within the same industry.
conducting their principal business activities in
the same industry, provided that (a) there is no
limitation with respect to obligations issued or
guaranteed by the U.S. government or its agencies
or instrumentalities, bank certificates of deposit
or bankers' acceptances issued by a domestic bank
or by a U.S. branch of a foreign bank provided
that such U.S. branch is subject to the same
regulation as U.S. banks, and repurchase
agreements secured by bank instruments or
obligations of the U.S. government or its agencies
or instrumentalities; (b) wholly owned finance
companies will be considered to be in the
industries of their parents if their activities
are primarily related to financing the activities
of their parents; and (c) utilities will be
divided according to their services. For example,
gas, gas transmission, electric and gas, electric,
and telephone will each be considered a separate
industry.
---------------------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Institutional Prime Obligations
Money Market Fund Pioneer Institutional Money Market Fund
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
gas, gas transmission, electric and gas,
electric, and telephone will each be
considered a separate industry.
---------------------------------------------------------------------------------------------------------------------------------
Restricted and AmSouth Institutional Prime Obligations Money Pioneer Institutional Money Market Fund will
illiquid securities Market Fund may not invest more than 10% of not invest more than 10% of its net assets in
its net assets in securities that are illiquid and other securities that are not
restricted as to resale, or for which no readily marketable. Repurchase agreements
readily available market exists, including maturing in more than seven days will be
repurchase agreements providing for included for purposes of the foregoing limit.
settlement more than seven days after notice.
---------------------------------------------------------------------------------------------------------------------------------
Borrowing AmSouth Institutional Prime Obligations Money Pioneer Institutional Money Market Fund may not
Market Fund may not borrow money or issue senior borrow money, except from banks for extraordinary
securities, except the Fund may borrow from banks purposes or to meet redemptions in amounts not
or enter into reverse repurchase agreements for exceeding 33 1/3% of its total assets (including
temporary emergency purposes in amounts up to 33 the amount borrowed).
1/3% of the value of its total assets at the time
of such borrowing. The Fund will not purchase
securities while borrowings (including reverse
repurchase agreements) in excess of 5% of its
total assets are outstanding. In addition, the
Fund is permitted to participate in a credit
facility whereby the Fund may directly lend to and
borrow money from other AmSouth funds for
temporary purposes, provided that the loans are
made in accordance with an order of exemption from
the SEC and any conditions thereto.
---------------------------------------------------------------------------------------------------------------------------------
Lending AmSouth Institutional Prime Obligations Money Pioneer Institutional Money Market Fund may not
Market Fund may not make loans, except that the make loans to any person, except by (a) the
Fund may purchase or hold debt instruments in purchase of a debt obligation in which the Fund is
accordance with its investment objective and permitted to invest and (b) engaging in repurchase
policies, lend Fund securities in accordance with agreements.
its investment objective and policies and enter
into repurchase agreements. In addition, the Fund
is permitted to participate in a credit facility
whereby the Fund may directly lend to and borrow
money from other AmSouth funds for temporary
purposes, provided that the loans are made in
accordance with an order of exemption from the SEC
and any conditions thereto.
---------------------------------------------------------------------------------------------------------------------------------
Other investment As described above, the Funds have substantially similar principal investment strategies and policies.
policies and Certain of the non-principal investment policies and restrictions are different. For a more complete
restrictions discussion of each Fund's other investment policies and fundamental and non-fundamental investment
restrictions, see the SAI.
---------------------------------------------------------------------------------------------------------------------------------
Buying, Selling and Exchanging Shares
---------------------------------------------------------------------------------------------------------------------------------
Institutional Class 1 Institutional Class 1 shares are offered Institutional Class 1 shares are offered
shares and Rule without sales charges or distribution or without sales charges or distribution or
12b-1 fees service (12b-1) fees. The minimum initial service (12b-1) fees. The minimum initial
investment for all Institutional Class 1 investment for all Institutional Class 1
share purchases by a share purchases by a shareholder is $3
---------------------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Institutional Prime Obligations
Money Market Fund Pioneer Institutional Money Market Fund
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
shareholder is $3 million. If the value of million.
Institutional Class 1 shares in your account
falls below $3 million, the Fund may ask you
to increase your balance. If it is still
below $3 million after 60 days, the Fund may
convert, at net asset value, your
Institutional Class 1 shares to Institutional
Class 2 shares.
Institutional Class 1 shares are offered only
to customers of AmSouth Bank for whom AmSouth
Bank acts as in a fiduciary, advisory,
custodial, agency, or similarly capacity, and
fiduciary customers of other financial
institutions approved by the Distributor
(Sweep Program Participant(s)).
---------------------------------------------------------------------------------------------------------------------------------
Institutional Class Institutional Class 2 shares are offered Institutional Class 2 shares are offered
2 shares and Rule without sales charges. without an initial sales charge.
12b-1 fees
Institutional Class 2 shares pay distribution Institutional Class 2 shares pay distribution
and service (12b-1) fees of 0.25% of average and service (12b-1) fees of 0.25% of average
daily net assets. daily net assets.
The minimum initial investment for all The minimum initial investment for all
Institutional Class 2 share purchases by a Institutional Class 2 share purchases by a
shareholder is $500,000. shareholder is $500,000.
---------------------------------------------------------------------------------------------------------------------------------
Institutional Class Institutional Class 3 shares are offered Institutional Class 3 shares are offered
3 shares and Rule without sales charges. without sales charges.
12b-1 fees
Institutional Class 3 shares pay distribution Institutional Class 3 shares pay distribution
and service (12b-1) fees of 0.50% of average and service (12b-1) fees of 0.50% of average
daily net assets. daily net assets.
The minimum initial investment for all The minimum initial investment for all
Institutional Class 3 share purchases by a Institutional Class 3 share purchases by a
shareholder is $50,000. shareholder is $50,000.
---------------------------------------------------------------------------------------------------------------------------------
Management and AmSouth Institutional Prime Obligations Money Pioneer Institutional Money Market Fund will
other fees Market Fund pays a management fee on a pay Pioneer an annual fee equal to 0.20% of
monthly basis at an annual rate of 0.20% of the Fund's average daily net assets. This fee
the Fund's average daily net assets. is computed daily and paid monthly.
ASO Services Company, Inc. ("ASO") serves as Institutional Class 1, Institutional Class 2
administrator and fund accounting agent for and Institutional Class 3 shares will be
the Fund. The Fund pays ASO an administrative issued for the first time in connection with
services fee of 0.15% of the Fund's average the Reorganization.
daily net assets.
In addition, the Fund will reimburse Pioneer
Other expenses of the Fund are being limited for certain fund accounting and legal
to 0.04% for each Institutional Class 1, expenses incurred on behalf of the Fund and
Institutional Class 2 and Institutional Class pay a separate shareholder servicing/transfer
3 share. Any fee waiver or expense agency fee to PIMSS, an affiliate of Pioneer.
reimbursement arrangement is
---------------------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------------
AmSouth Institutional Prime Obligations
Money Market Fund Pioneer Institutional Money Market Fund
---------------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------------
voluntary and may be discontinued at any The Fund's annual fund operating expenses for
time. Class 1 shares, after giving effect to the
expense limitation, are estimated to be
For the fiscal year ended July 31, 2004, the 0.25%, and without giving effect to the
Fund's annual operating expenses for expense limitation are estimated to be 0.28%
Institutional Class 1 shares, after giving of average daily net assets.
effect to the expense limitation were 0.25%,
and without giving effect to the expense The Fund's annual fund operating expenses for
limitation, were 0.41% of average daily net Class 2 shares, after giving effect to the
assets. expense limitation, are estimated to be
0.50%, and without giving effect to the
For the fiscal year ended July 31, 2004, the expense limitation are estimated to be 0.53%
Fund's annual operating expenses for of average daily net assets.
Institutional Class 2 shares, after giving
effect to the expense limitation were 0.50%, The Fund's annual fund operating expenses for
and without giving effect to the expense Class 3 shares, after giving effect to the
limitation, were 0.66% of average daily net expense limitation, are estimated to be
assets. 0.75%, and without giving effect to the
expense limitation are estimated to be 0.78%
For the fiscal year ended July 31, 2004, the of average daily net assets.
Fund's annual operating expenses for
Institutional Class 3 shares, after giving
effect to the expense limitation were 0.75%,
and without giving effect to the expense
limitation, were 0.91% of average daily net
assets.
---------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares of AmSouth Institutional You may buy shares from any investment firm
Prime Obligations Money Market Fund directly that has a sales agreement with PFD, the
through BISYS Fund Services, the Fund's Fund's distributor.
distributor, or through brokers, registered
investment advisers, banks and other If the account is established in the
financial institutions that have entered into shareholder's own name, shareholders may also
selling agreements with the Fund's purchase additional shares of the Fund by
distributor, as described in the Fund's telephone or online.
prospectus.
Certain account transactions may be done by
telephone.
---------------------------------------------------------------------------------------------------------------------------------
Exchanging shares You may not exchange your shares in the You may not exchange your shares in the
AmSouth Fund for shares of another AmSouth Pioneer Fund for shares of another Pioneer
fund. Fund.
---------------------------------------------------------------------------------------------------------------------------------
Selling shares Shares of each Fund are sold at the net asset value per share next calculated after the Fund receives your
request in good order.
---------------------------------------------------------------------------------------------------------------------------------
You may sell your shares by contacting the Normally, your investment firm will send your
Fund directly in writing or by telephone or request to sell shares to PIMSS. You can also
by contacting a financial intermediary as sell your shares by contacting the Fund
described in the Fund's prospectus. directly if your account is registered in
your name.
If the account is established in the
shareholder's own name, shareholders may also
redeem shares of the Fund by telephone or
online.
---------------------------------------------------------------------------------------------------------------------------------
|
Comparison of Principal Risks of Investing in the Funds
Because each Fund has a similar investment objective, primary investment policies and strategies, the Funds are subject to the same principal risks. Even though each Fund seeks to maintain a $1 share price, you could lose money on your investment in either Fund or not make as much as if you invested elsewhere if:
o Interest rates go up, causing the value of the Fund's investments to decline
o The issuer of a security owned by the Fund defaults on its obligation to pay principal and/or interest or has its credit rating downgraded
o The adviser's judgment about the credit quality, attractiveness or relative value of a particular security proves to be incorrect
Past Performance
Set forth below is performance information for AmSouth Institutional Prime Obligations Money Market Fund. The bar charts show how AmSouth Institutional Prime Obligations Money Market Fund's total return (not including any deduction for sales charges) has varied from year to year for each full calendar year. The tables show average annual total return for AmSouth Institutional Prime Obligations Money Market Fund over time for each class of shares compared with a broad-based securities market index. The bar charts give an indication of the risks of investing in AmSouth Institutional Prime Obligations Money Market Fund, including the fact that you could incur a loss and experience volatility of returns year to year. Past performance does not indicate future results. Pioneer Institutional Money Market Fund has not commenced investment operations.
Safeco Money Market Fund will not concentrate its assets in the securities of
issuers in any one industry 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.
AmSouth Institutional Prime Obligations Money Market Fund -- Institutional Class I Shares Calendar Year Total Returns*
1999 2000 2001 2002 2003 2004 5.07 6.33 3.99 1.53 0.95 1.16 |
* The returns reported above assume the reinvestment of dividends. During the period shown in the bar chart, your AmSouth Fund's highest quarterly return was 1.63% for the quarter ended September 30, 2000, and the lowest quarterly return was 0.21% for the quarter ended December 31, 2003. The returns for Institutional Class 2 shares and Institutional Class 3 shares will differ from the Institutional Class 1 shares returns shown on the bar chart above because of differences in the expenses of each class.
AmSouth Institutional Prime Obligations Money Market Fund(1) Average Annual Total Returns as of December 31, 2004
--------------------------------------------------------------------------------
1 Year 5 Years Since Inception
(9/15/98)
--------------------------------------------------------------------------------
Institutional Class 1 Shares 1.16% 2.76% 2.23%
--------------------------------------------------------------------------------
Institutional Class 2 Shares(2) 0.91% 2.51% 2.98%
--------------------------------------------------------------------------------
Institutional Class 3 Shares(2) 0.67% 2.25% 2.72%
--------------------------------------------------------------------------------
|
(1) The returns reported above assume the reinvestment of dividends.
(2) Performance for the Institutional Class 2 and Institutional Class 3 shares, which were first offered on 2/19/99 and 2/22/99, respectively, is based on the historical performance of the Institutional Class 1 shares prior to that date.
------------------------------------------------------------------------------
7-Day Yield
As of December 31, 2004
------------------------------------------------------------------------------
AmSouth Institutional Prime Obligations Money Market Fund
------------------------------------------------------------------------------
Institutional Class 1 Shares 2.04%
------------------------------------------------------------------------------
Institutional Class 2 Shares 1.78%
------------------------------------------------------------------------------
Institutional Class 3 Shares 1.54%
------------------------------------------------------------------------------
|
The most recent portfolio manager's discussion of AmSouth Institutional Prime Obligations Money Market Fund's performance is attached as Exhibit C.
The Funds' Fees and Expenses
Shareholders of both Funds pay various fees and expenses, either directly or indirectly. The table below shows the fees and expenses that you would pay if you were to buy and hold shares of each Fund. The expenses in the table appearing below are based on (i) for the AmSouth Institutional Prime Obligations Money Market Fund, the expenses of AmSouth Institutional Prime Obligations Money Market Fund for the period ended January 31, 2005, and (ii) for the Pioneer Institutional Money Market Fund, the estimated pro forma annual expenses for the period ended May 31, 2005.
-------------------------------------------------------------------------------------------------------------------------------
AmSouth Pro Forma AmSouth AmSouth
Institutional Pioneer Institutional Pro Forma Institutional Pro Forma
Shareholder Prime Institutional Prime Pioneer Prime Pioneer
transaction Obligations Money Market Obligations Institutional Obligations Institutional
fees (paid Money Market Fund Money Market Money Market Fund Money Market Money Market Fund
directly from Fund(1) Fund(1) Fund(1)
your Institutional Institutional Institutional Institutional Institutional Institutional
investment) Class 1 Class 1 Class 2 Class 2 Class 3 Class 3
-------------------------------------------------------------------------------------------------------------------------------
Maximum sales c
charge (load)
when you buy None None None None None None
shares as a
percentage of
offering price
-------------------------------------------------------------------------------------------------------------------------------
|
-------------------------------------------------------------------------------------------------------------------------------
AmSouth Pro Forma AmSouth AmSouth
Institutional Pioneer Institutional Pro Forma Institutional Pro Forma
Shareholder Prime Institutional Prime Pioneer Prime Pioneer
transaction Obligations Money Market Obligations Institutional Obligations Institutional
fees (paid Money Market Fund Money Market Money Market Fund Money Market Money Market Fund
directly from Fund(1) Fund(1) Fund(1)
your Institutional Institutional Institutional Institutional Institutional Institutional
investment) Class 1 Class 1 Class 2 Class 2 Class 3 Class 3
-------------------------------------------------------------------------------------------------------------------------------
Maximum
deferred
sales charge
(load) as a
percentage of None None None None None None
purchase
price or
the amount
you receive
when you
sell shares,
whichever is
less
-------------------------------------------------------------------------------------------------------------------------------
Redemption None(2) None None(2) None None(2) None
fees
-------------------------------------------------------------------------------------------------------------------------------
Annual fund
operating
expenses
(deducted from
fund assets)
(as a % of
average net
assets)
-------------------------------------------------------------------------------------------------------------------------------
Management fee 0.20% 0.20% 0.20% 0.20% 0.20% 0.20%
-------------------------------------------------------------------------------------------------------------------------------
Distribution None None 0.25% 0.25% 0.50% 0.50%
and service
(12b-1) fee
-------------------------------------------------------------------------------------------------------------------------------
Other expenses 0.20%(3) 0.08% 0.20%(3) 0.08% 0.21%(3) 0.08%
-------------------------------------------------------------------------------------------------------------------------------
Total fund 0.40% 0.28% 0.65% 0.53%(4) 0.91% 0.78%(4)
operating
expenses
-------------------------------------------------------------------------------------------------------------------------------
Expense 0.15% 0.03% 0.16% 0.03% 0.16% 0.03%
reimbursement/
reduction
-------------------------------------------------------------------------------------------------------------------------------
Net fund 0.25% 0.25% 0.49% 0.50% 0.75% 0.75%
operating
expenses(5)
-------------------------------------------------------------------------------------------------------------------------------
|
(1) AmSouth Bank or other financial institutions may charge their customer account fees for automatic investment and other cash management services provided in connection with investment in the Fund.
(2) A wire transfer fee of $7.00 will be deducted from the amount of your redemption if you request a wire transfer.
(3) Other expenses for your AmSouth Fund are being limited to 0.05% for each Institutional Class 1 and Institutional Class 3 share and 0.04% for each Institutional Class 2 share. Any fee waiver or expense reimbursement arrangement is voluntary and may be discontinued at any time.
(4) The Pioneer Fund's total annual operating expenses in the table have not been reduced by any expense offset arrangements.
(5) Pioneer as contractually agreed to limit the ordinary operating expenses of Class 1 shares to 0.25% of average daily net assets attributable to Class 1 expenses, of class 3 shares to 0.50% of average daily net assets attributable to Class 2
shares and of Class 3 shares to 0.75% of average daily net assets attributable to Class 3 shares, in each case until December 1, 2008.
The hypothetical example below helps you compare the cost of investing in each Fund. It assumes that: (a) you invest $10,000 in each Fund for the time periods shown, (b) you reinvest all dividends and distributions, (c) your investment has a 5% return each year, (d) each Fund's operating expenses remain the same, and (e) you sell your shares at the end of the time period shown. The examples are for comparison purposes only and are not a representation of either Fund's actual expenses or returns, either past or future.
------------------------------------------------------------------------------------------
Number of years you AmSouth Institutional Prime Pro Forma
own your shares Obligations Money Market Fund Pioneer Institutional Money
Market Fund
------------------------------------------------------------------------------------------
Institutional Class 1 Shares
------------------------------------------------------------------------------------------
Year 1 $41 $26
------------------------------------------------------------------------------------------
Year 3 $128 $84
------------------------------------------------------------------------------------------
Year 5 $224 $151
------------------------------------------------------------------------------------------
Year 10 $505 $350
------------------------------------------------------------------------------------------
Institutional Class 2 Shares
------------------------------------------------------------------------------------------
Year 1 $66 $51
------------------------------------------------------------------------------------------
Year 3 $208 $164
------------------------------------------------------------------------------------------
Year 5 $362 $290
------------------------------------------------------------------------------------------
Year 10 $810 $585
------------------------------------------------------------------------------------------
Institutional Class 3 Shares
------------------------------------------------------------------------------------------
Year 1 $93 $77
------------------------------------------------------------------------------------------
Year 3 $290 $246
------------------------------------------------------------------------------------------
Year 5 $504 $430
------------------------------------------------------------------------------------------
Year 10 $1,120 $964
------------------------------------------------------------------------------------------
|
Reasons for the Proposed Reorganization
The Trustees believe that the proposed Reorganization is in the best interests of AmSouth Institutional Prime Obligations Money Market Fund. The Trustees considered the following matters, among others, in approving the proposal.
First, AAMI, the investment adviser to the Fund, informed the Trustees that it does not intend to continue to provide investment advisory services to the AmSouth Funds. Consequently, a change in your AmSouth Fund's investment adviser was necessary. In the absence of the Reorganization, such a change would be more likely to motivate shareholders invested in reliance on AAMI's role to withdraw from the Fund, thereby reducing fund size and increasing fund expense ratios.
Second, the resources of Pioneer. At December 31, 2004, Pioneer managed over 80 investment companies and accounts with approximately $42 billion in assets. Pioneer is part of the global asset management group of UniCredito Italiano S.p.A., one of the largest banking groups in Italy, providing investment management and financial services to mutual funds, institutional and other clients. As of December 31, 2004, assets under management of UniCredito Italiano S.p.A. were approximately $175 billion worldwide. Shareholders of your AmSouth Fund would become part of a significantly larger family of funds that offers a more diverse array of investment options and enhanced shareholder account options. The Pioneer family of mutual funds offers over 80 funds, including domestic and international equity and fixed income funds and a money market fund that will be available to your AmSouth Fund's shareholders through exchanges. In addition, Pioneer offers shareholders additional options for their accounts, including the ability to transact and exchange shares over the telephone or online and the ability to access account values and transaction history in all of the shareholder's direct accounts in the Pioneer Funds over the telephone or online.
Third, Pioneer Institutional Money Market Fund's management fee (0.20% of average daily net assets) will be the same as the advisory fee of your Fund (0.20% of average daily net assets). The aggregate Rule 12b-1 distribution and shareholder servicing fees and non-Rule 12b-1 shareholder servicing fees paid by both Funds will be the same. The gross
expenses of each class of the Pioneer Fund are estimated to be lower than the gross expenses of the corresponding class of the AmSouth Fund. Net of expense limitations, the expenses of the Class 1 and Class 3 shares of the Pioneer Fund are estimated to be the same as net expenses of the corresponding class of the AmSouth Fund. The estimated net expenses of the Class 2 shares of the Pioneer Fund are estimated to be one basis point higher than the net expenses of the Class 2 shares of the AmSouth Fund. AAMI has informed the trustees that the expense limitations will be discontinued in the future.
Fourth, the Institutional Class 1, Institutional Class 2 and Institutional Class 3 shares of Pioneer Fund received in the Reorganization will provide AmSouth Institutional Prime Obligations Money Market Fund shareholders with exposure to substantially the same investment product as they currently have.
Fifth, the transaction is structured to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code of 1986 and therefore will not be treated as a taxable sale of your AmSouth shares.
Pioneer and AmSouth Bank will pay all costs of preparing and printing the Funds' proxy statements and solicitation costs incurred by the Funds in connection with the Reorganization. AAMI will otherwise be responsible of all costs and expenses of AmSouth Fund in connection with the Reorganizations. The Trustees also considered that Pioneer and AmSouth Bank will benefit from the Reorganization. See "Will Pioneer and AmSouth Bank Benefit from the Reorganizations."
The Board of Trustees of the Pioneer Fund also considered that the Reorganization presents an excellent opportunity for the Pioneer Fund to acquire investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Pioneer Fund and its shareholders.
CAPITALIZATION
The following table sets forth the capitalization of AmSouth Institutional Prime Obligations Money Market Fund as of May 31, 2005.
-------------------------------------------------------------------------------------------------------------
AmSouth Institutional Pioneer Pro Forma Pioneer
Prime Obligations Institutional Money Institutional Money
Money Market Fund Market Fund Market Fund
May 31, 2005 May 31, 2005 May 31, 2005
-------------------------------------------------------------------------------------------------------------
Total Net Assets (in thousands) $374,130 N/A $374,130
-------------------------------------------------------------------------------------------------------------
Institutional Class 1 shares ........ $185,856 N/A $185,856
-------------------------------------------------------------------------------------------------------------
Institutional Class 2 shares ........ $139,943 N/A $139,943
-------------------------------------------------------------------------------------------------------------
Institutional Class 3 shares ........ $48,331 N/A $48,331
-------------------------------------------------------------------------------------------------------------
Net Asset Value Per Share
-------------------------------------------------------------------------------------------------------------
Institutional Class 1 shares ........ $1.00 N/A $1.00
-------------------------------------------------------------------------------------------------------------
Institutional Class 2 shares ........ $1.00 N/A $1.00
-------------------------------------------------------------------------------------------------------------
Institutional Class 3 shares ........ $1.00 N/A $1.00
-------------------------------------------------------------------------------------------------------------
Shares Outstanding
-------------------------------------------------------------------------------------------------------------
Institutional Class 1shares ......... 185,860,023 N/A 185,860,023
-------------------------------------------------------------------------------------------------------------
Institutional Class 2 shares ........ 139,943,961 N/A 139,943,961
-------------------------------------------------------------------------------------------------------------
Institutional Class 3 shares ........ 48,331,683 N/A 48,331,683
-------------------------------------------------------------------------------------------------------------
|
It is impossible to predict how many shares of the Pioneer Fund will actually be received and distributed by your AmSouth Fund on the Reorganization date. The table should not be relied upon to determine the amount of the Pioneer Fund's shares that will actually be received and distributed.
BOARD'S EVALUATION AND RECOMMENDATION
For the reasons described above, the Trustees, including the Independent Trustees, approved the Reorganization. In particular, the Trustees determined that the Reorganization is in the best interests of your AmSouth Fund. Similarly, the Board of Trustees of the Pioneer Fund, including its Independent Trustees, approved the Reorganization. They also determined that the Reorganization is in the best interests of the Pioneer Fund.
The Trustees recommend that the shareholders of your AmSouth Fund vote FOR the proposal to approve the Agreement and Plan of Reorganization.
TERMS OF EACH AGREEMENT AND PLAN OF REORGANIZATION
The Reorganizations
o Each Reorganization is scheduled to occur at 4:00 p.m., Eastern time, on [ ], 2005, unless your AmSouth Fund and the corresponding Pioneer Fund agree in writing to a later date. Your AmSouth Fund will transfer all of its assets to the corresponding Pioneer Fund. The corresponding Pioneer Fund will assume your AmSouth Fund's liabilities that are included in the calculation of your AmSouth Fund's net asset value on the Closing Date. The net asset value [of both Funds] will be computed as of 4:00 p.m., Eastern time, on the Closing Date.
o Each Pioneer Fund (other than Pioneer Institutional Money Market Fund) will issue to the corresponding AmSouth Fund Class A, B and Y shares with an aggregate net asset value equal to the net assets attributable to the corresponding AmSouth Fund's Class A, B and I shares. These shares will immediately be distributed to your AmSouth Fund's shareholders in proportion to the relative net asset value of their holdings of your AmSouth Fund's shares on the Closing Date. As a result, each AmSouth Fund's shareholders will end up as Class A, B, or Y class shareholders of the corresponding Pioneer Fund.
o In the case of Pioneer Institutional Money Market Fund, Class 1, 2 and 3 shares will be distributed in exchange for Institutional Class 1, 2 and 3 shares of AmSouth Institutional Prime Obligations Money Market Fund. These shares will immediately be distributed to AmSouth Institutional Prime Obligations Money Market Fund's shareholders in proportion to the relative net asset value of their holdings of AmSouth Institutional Prime Obligations Money Market Fund's shares on the Closing Date. As a result, AmSouth Institutional Prime Obligations Money Market Fund's shareholders will end up as Class 1, 2 or 3 shareholders of Pioneer Institutional Money Market Fund.
o After the distribution of shares, your AmSouth Fund will be liquidated and dissolved.
o Each Reorganization is intended to result in no income, gain or loss being recognized for federal income tax purposes and will not take place unless both Funds involved in the Reorganization receive a satisfactory opinion concerning the tax consequences of the Reorganization from Wilmer Cutler Pickering Hale and Dorr LLP, counsel to the Pioneer Funds.
Agreement and Plan of Reorganization
The shareholders of each AmSouth Fund are being asked to approve an Agreement and Plan of Reorganization substantially in the form attached as EXHIBIT A-1 or A-2 (each, a "Plan"). The description of the Plan contained herein is qualified in its entirety by the attached copies, as appropriate.
Conditions to Closing each Reorganization. The obligation of each Fund to consummate each Reorganization is subject to the satisfaction of certain conditions, including each Fund's performance of all of its obligations under the Plan, the receipt of certain documents and financial statements from your AmSouth Fund and the receipt of all consents, orders and permits necessary to consummate the Reorganization (see Sections 7 and 8 of the Plan). The consummation of each Reorganization is not contingent on consummation of any other Reorganization.
The obligations of both Funds are subject to the approval of the Plan by the necessary vote of the outstanding shares of your AmSouth Fund, in accordance with the provisions of AmSouth Funds' trust instrument and by-laws. The Funds' obligations are also subject to the receipt of a favorable opinion of Wilmer Cutler Pickering Hale and Dorr LLP as to the United States federal income tax consequences of each Reorganization (see Section 8.5 of the Plan).
Termination of the Plan. The board of either the AmSouth Funds or the corresponding Pioneer Fund may terminate the Plan (even if the shareholders of your AmSouth Fund have already approved it) at any time before the Closing Date, if that board believes in good faith that proceeding with the Reorganization would no longer be in the best interests of shareholders.
TAX STATUS OF EACH REORGANIZATION
Each Reorganization is intended to result in no income, gain or loss being recognized for United States federal income tax purposes and will not take place unless both Funds involved in the Reorganization receive a satisfactory opinion from Wilmer Cutler Pickering Hale and Dorr LLP, counsel to the Pioneer Funds, substantially to the effect that each Reorganization will be a "reorganization" within the meaning of Section 368(a) of the Code.
As a result, for federal income tax purposes:
o No gain or loss will be recognized by your AmSouth Fund upon (1) the transfer of all of its assets to the corresponding Pioneer Fund as described in this Proxy Statement/Prospectus or (2) the distribution by your AmSouth Fund of Pioneer Fund shares to your AmSouth Fund's shareholders;
o No gain or loss will be recognized by the corresponding Pioneer Fund upon the receipt of your AmSouth Fund's assets solely in exchange for the issuance of Pioneer Fund shares to your AmSouth Fund and the assumption of your AmSouth Fund's liabilities by the Pioneer Fund;
o The basis of the assets of your AmSouth Fund acquired by the corresponding Pioneer Fund will be the same as the basis of those assets in the hands of your AmSouth Fund immediately before the transfer;
o The tax holding period of the assets of your AmSouth Fund in the hands of the corresponding Pioneer Fund will include your AmSouth Fund's tax holding period for those assets;
o You will not recognize gain or loss upon the exchange of your shares of your AmSouth Fund solely for the Pioneer Fund shares as part of the Reorganization;
o The basis of the Pioneer Fund shares received by you in the Reorganization will be the same as the basis of your shares of your AmSouth Fund surrendered in the exchange; and
o The tax holding period of the Pioneer Fund shares you receive will include the tax holding period of the shares of your AmSouth Fund surrendered in the exchange, provided that you held the shares of your AmSouth Fund as capital assets on the date of the exchange.
In rendering such opinions, counsel shall rely upon, among other things, reasonable assumptions as well as representations of your AmSouth Fund and the Pioneer Fund (see the annexes to the Plan).
No tax ruling has been or will be received from the Internal Revenue Service ("IRS") in connection with the Reorganizations. An opinion of counsel is not binding on the IRS or a court, and no assurance can be given that the IRS would not assert, or a court would not sustain, a contrary position.
You should consult your tax adviser for the particular tax consequences to you of the Reorganizations, including the applicability of any state, local or foreign tax laws.
VOTING RIGHTS AND REQUIRED VOTE
Each share of your AmSouth Fund is entitled to one vote and each fractional share shall be entitled to a proportionate fractional vote. A quorum is required to conduct business at the Meeting. With respect to each AmSouth Fund, the presence in person or by proxy of a majority of the outstanding shares of an AmSouth Fund entitled to cast votes at the Meeting will constitute a quorum with respect to that AmSouth Fund. A favorable vote of a "majority of the outstanding voting securities" of the applicable AmSouth Fund is required to approve each Proposal. Under the Investment Company Act, the vote of a majority of the outstanding voting securities means the affirmative vote of the lesser of (i) 67% or more of the shares of the applicable AmSouth Fund represented at the meeting, if at least 50% of all outstanding shares of the AmSouth Fund are represented at the meeting, or (ii) 50% or more of the outstanding shares of the AmSouth Fund entitled to vote at the meeting.
-------------------------------------------------------------------------------------------------------------------------------
Shares Quorum Voting
-------------------------------------------------------------------------------------------------------------------------------
In General All shares "present" in person or by Shares "present" in person will be voted
proxy are counted towards a quorum. in person at the Meeting. Shares
present by proxy will be voted in
accordance with instructions.
-------------------------------------------------------------------------------------------------------------------------------
Broker Non-Vote (where the underlying Considered "present" at Meeting for Broker non-votes do not count as a vote
holder has not voted and the broker does purposes of quorum. "for" and effectively result in a vote
not have discretionary authority to vote "against" Proposals 1(a)-(w).
the shares)
-------------------------------------------------------------------------------------------------------------------------------
Proxy with No Voting Instruction (other Considered "present" at Meeting for Voted "for" the proposal.
than Broker Non-Vote) purposes of quorum.
-------------------------------------------------------------------------------------------------------------------------------
Vote to Abstain Considered "present" at Meeting for Abstentions do not constitute a vote
purposes of quorum. "for" and effectively result in a vote
"against" Proposals 1(a)-(w).
-------------------------------------------------------------------------------------------------------------------------------
|
COMPARISON OF DELAWARE STATUTORY TRUST AND MASSACHUSETTS BUSINESS TRUST
The AmSouth Funds are series of a Massachusetts Business Trust. Most of the Pioneer Funds are series of Delaware Statutory Trusts. The following is a summary of the principal differences between Delaware Statutory Trusts and Massachusetts Business Trusts.
Limitation of Shareholders' and Series' Liability
Delaware law provides that the shareholders of a Delaware statutory trust shall not be subject to liability for the debts or obligations of the trust. Under Massachusetts law, shareholders of a Massachusetts business trust (such as the shareholders of Europe Fund) may, under certain circumstances, be liability for the debts and obligations of that trust. Although the risk of liability of shareholders of a Massachusetts business trust who do not participate in the management of the trust may be remote, Delaware law affords grater protection against potential shareholder liability. Similarly, Delaware law provides that, to the extent that a Delaware statutory trust issues multiple series of shares, each series shall not be liable for the debts or obligations of any other series, another potential, although remote, risk in the case of a Massachusetts business trust. While the trustees believe that a series of a Massachusetts business trust will only be liable for its own obligations, there is no direct statutory or judicial support for that position.
Limitation of Trustee Liability
Delaware law provides that, except to the extent otherwise provided in a trust's declaration of trust or by-laws, trustees will not be personally liable to any person (other than the statutory trust or a shareholder thereof) for any act, omission or obligation of the statutory trust or any trustee thereof. Delaware law also provides that a trustee's actions under a Delaware statutory trust's declaration of trust or by-laws will not subject the trustee to liability to the statutory trust or its shareholders if the trustee takes such action in good faith reliance on the provisions of the statutory trust's declaration of trust or bylaws. The declaration of trust of a Massachusetts business trust may limit the liability of a trustee, who is not also an officer of the corporation, for breach of fiduciary duty except for, among other things, any act or omission not in good faith which involves
intentional misconduct or a knowing violation of law or any transaction from which such trustee derives an improper direct or indirect financial benefit. The trustees believe that such limitations on liability under Delaware law and under the Pioneer Funds' declarations of trust are consistent with those applicable to directors of a corporation under Delaware law and will be beneficial in attracting and retaining in the future qualified persons to act as trustees.
Shareholder Voting
Delaware law provides that a Delaware statutory trust's declaration of trust or by-laws may set forth provisions related to voting in any manner. This provision appears to permit trustee and shareholder voting through computer or electronic media. For an investment company with a significant number of institutional shareholders, all with access to computer or electronic networks, the use of such voting methods could significantly reduce the costs of shareholder voting. However, the advantage of such methods may not be realizable unless the SEC modifies its proxy rules. Also, as required by the Investment Company Act of 1940, as amended (the "1940 Act"), votes on certain matters by trustees would still need to be taken at actual in-person meetings.
Board Composition
Delaware law explicitly provides that separate boards of trustees may be authorized for each series of a Delaware statutory trust. Whether separate boards of trustees can be authorized for series of a Massachusetts business trust is unclear under Massachusetts law. As always, the establishment of any board of trustees of a registered investment company must comply with applicable securities laws, including the provision of the 1940 Act regarding the election of trustees by shareholders. Establishing separate boards of trustees would, among other things, enable the series of a Delaware statutory trust to be governed by individuals who are more familiar with such series' particular operations.
ADDITIONAL INFORMATION ABOUT THE PIONEER FUNDS
Investment Adviser
Pioneer serves as the investment adviser to each Pioneer Fund. Pioneer is an indirect, wholly owned subsidiary of UniCredito Italiano S.p.A., one of the largest banking groups in Italy. Pioneer is part of the global asset management group providing investment management and financial services to mutual funds, institutions and other clients. As of December 31, 2004, assets under management were approximately $175 billion worldwide, including over $42 billion in assets under management by Pioneer. Pioneer's main office is at 60 State Street, Boston, Massachusetts 02109. Pioneer's U.S. mutual fund investment history includes creating one of the first mutual funds in 1928.
The Board of Trustees of the Pioneer Funds is responsible for overseeing the performance of each of Pioneer Fund's investment adviser and subadviser, if any, and determining whether to approve and renew the fund's investment advisory agreement and the subadvisory agreements.
Pioneer has received an order (the "Exemptive Order") from the SEC that permits Pioneer, subject to the approval of the Pioneer Funds' Board of Trustees, to hire and terminate a subadviser or to materially modify an existing subadvisory agreement for a Pioneer Fund without shareholder approval. Pioneer retains the ultimate responsibility to oversee and recommend the hiring, termination and replacement of any subadviser. To the extent that the SEC adopts a rule that would supersede the Exemptive Order, Pioneer and the Pioneer Funds intend to rely on such rule to permit Pioneer, subject to the approval of the Pioneer Funds' Board of Trustees and any other applicable conditions of the rule, to hire and terminate a subadviser or to materially modify an existing subadvisory agreement for a Pioneer Fund without shareholder approval.
Buying, Exchanging and Selling Shares of the Pioneer Funds
Net Asset Value. Each Pioneer Fund's net asset value is the value of its portfolio of securities plus any other assets minus its operating expenses and any other liabilities. Each Pioneer Fund calculates a net asset value for each class of shares every day the New York Stock Exchange is open when regular trading closes (normally 4:00 p.m. Eastern time).
Each Pioneer Fund generally values its portfolio securities using closing market prices or readily available market quotations. When closing market prices or market quotations are not available or are considered by Pioneer to be unreliable, a
Pioneer Fund will use a security's fair value. Fair value is the valuation of a security determined on the basis of factors other than market value in accordance with procedures approved by the Pioneer Funds' trustees. Each Pioneer Fund also may use the fair value of a security, including a non-U.S. security, when Pioneer determines that the closing market price on the primary exchange where the security is traded no longer accurately reflects the value of the security due to factors affecting one or more relevant securities markets or the specific issuer. The use of fair value pricing by a Pioneer Fund may cause the net asset value of its shares to differ from the net asset value that would be calculated using closing market prices. International securities markets may be open on days when the U.S. markets are closed. For this reason, the value of any international securities owned by a Pioneer Fund could change on a day you cannot buy or sell shares of the fund. Each Pioneer Fund may use a pricing service or a pricing matrix to value some of its assets. Debt securities with remaining maturities of 60 days or less are valued at amortized cost, which is a method of determining a security's fair value.
Pioneer International Core Equity Fund primarily invests in securities of non-U.S. issuers and the markets for these securities generally close prior to the time the Fund determines its net asset value. However, the value of these securities continues to be influenced by changes in the global markets. Consequently, the trustees have determined to use the fair value of these securities as of the time the fund determines its net asset value, based upon data from a pricing service. On a daily basis, the pricing service recommends changes, based upon a proprietary model, to the closing market prices of each non-U.S. security held by the fund to reflect the security's fair value at the time the fund determines its net asset value. The fund applies these recommendations in accordance with procedures approved by the trustees. A security's fair value determined in this manner may differ from the security's closing market price on the date the fund determines its net asset value or the opening price of the security on the next business day. The fund's use of this method may significantly affect its net asset value compared to the net asset value that would have been determined using closing market prices. The fund also may take other factors influencing specific markets or issuers into consideration in determining the fair value of a non-U.S. security.
You buy or sell shares at the share price. When you buy Class A shares, you pay an initial sales charge unless you qualify for a waiver or reduced sales charge. However, the Class A shares of the Pioneer Funds you receive in the Reorganizations will not be subject to any sales charge. When you buy Class B shares, you do not pay an initial sales charge but impose a contingent deferred sales charge. However, if you sell within five years of purchase, you will pay a contingent deferred sales charge. The Class B shares of the Pioneer Funds you receive in the transaction will be subject to the same contingent deferred sales charge as your Class B shares of the AmSouth Funds held at the time of sale. These shares would then convert to Class A shares eight years after the original date of purchase. Class Y shares do not impose a sales charge.
Opening Your Account. If your shares are held in your investment firm's name, the options and services available to you may be different from those described herein or in the Pioneer Fund's prospectus. Ask your investment professional for more information.
If you invest in a Pioneer Fund through investment professionals or other financial intermediaries, including wrap programs and fund supermarkets, additional conditions may apply to your investment in a Pioneer Fund, and the investment professional or intermediary may charge you a transaction-based or other fee for its services. These conditions and fees are in addition to those imposed by the Pioneer Fund and its affiliates. You should ask your investment professional or financial intermediary about its services and any applicable fees.
Account Options. Use your account application to select options and privileges for your account. You can change your selections at any time by sending a completed account options form to the transfer agent. You may be required to obtain a signature guarantee to make certain changes to an existing account.
Call or write to the Pioneer Funds' transfer agent for account applications, account options forms and other account information:
PIONEER INVESTMENT MANAGEMENT SHAREHOLDER SERVICES, INC.
P.O. Box 55014
Boston, Massachusetts 02205-5014
Telephone 1-800-225-6292
Telephone Transaction Privileges. If your account is registered in your name, you can buy, exchange or sell shares of the Pioneer Funds by telephone. If you do not want your account to have telephone transaction privileges, you must indicate that choice on your account application or by writing to the transfer agent.
When you request a telephone transaction the transfer agent will try to confirm that the request is genuine. The transfer agent records the call, requires the caller to provide the personal identification number for the account and sends you a written confirmation. Each Pioneer Fund may implement other confirmation procedures from time to time. Different procedures may apply if you have a non-U.S. account or if your account is registered in the name of an institution, broker-dealer or other third party.
Online Transaction Privileges. If your account is registered in your name, you may be able to buy, exchange or sell fund shares online. Your investment firm may also be able to buy, exchange or sell your Pioneer Fund shares online.
To establish online transaction privileges complete an account options form,
write to the transfer agent or complete the online authorization screen on:
www.pioneerfunds.com.
To use online transactions, you must read and agree to the terms of an online transaction agreement available on the Pioneer website. When you or your investment firm requests an online transaction the transfer agent electronically records the transaction, requires an authorizing password and sends a written confirmation. The Pioneer Funds may implement other procedures from time to time. Different procedures may apply if you have a non-U.S. account or if your account is registered in the name of an institution, broker-dealer or other third party. You may not be able to use the online transaction privilege for certain types of accounts, including most retirement accounts.
Share Price. If you place an order with your investment firm before the New York Stock Exchange closes and your investment firm submits the order to PFD prior to PFD's close of business (usually 5:30 p.m. Eastern time), your share price will be calculated that day. Otherwise, your price per share will be calculated at the close of the New York Stock Exchange after the distributor receives your order. Your investment firm is responsible for submitting your order to the distributor.
Buying Pioneer Fund Shares. You may buy shares of each Pioneer Fund from any investment firm that has a sales agreement with PFD. If you do not have an investment firm, please call 1-800-225-6292 for information on how to locate an investment professional in your area.
You can buy shares of the Pioneer Funds at the offering price. The distributor may reject any order until it has confirmed the order in writing and received payment. The fund reserves the right to stop offering any class of shares.
Minimum Investment Amounts. Your initial investment must be at least $1,000. Additional investments must be at least $100 for Class A shares. You may qualify for lower initial or subsequent investment minimums if you are opening a retirement plan account, establishing an automatic investment plan or placing your trade through your investment firm. The minimum investment amount does not apply for purposes of the Reorganization.
Exchanging Pioneer Fund Shares. You may exchange your shares in a Pioneer Fund for shares of the same class of another Pioneer mutual fund. Your exchange request must be for at least $1,000 unless the fund you are exchanging into has a different minimum. Each Pioneer Fund allows you to exchange your shares at net asset value without charging you either an initial or contingent deferred sales charge at the time of the exchange. Shares you acquire as part of an exchange will continue to be subject to any contingent deferred sales charge that applies to the shares you originally purchased. When you ultimately sell your shares, the date of your original purchase will determine your contingent deferred sales charge. Before you request an exchange, consider each Fund's investment objective and policy as described in each fund's prospectus.
Selling Pioneer Fund Shares. Your shares will be sold at net asset value per share next calculated after the Pioneer Fund, or authorized agent, and as a broker-dealer, receives your request in good order. If the shares you are selling are subject to a deferred sales charge, it will be deducted from the sale proceeds. Each Pioneer Fund generally will send your sale proceeds by check, bank wire or electronic funds transfer. Normally you will be paid within seven days. If you are selling shares from a non-retirement account or certain IRAs, you may use any of the methods described below. If you are selling shares from a retirement account other than an IRA, you must make your request in writing.
You may have to pay federal income taxes on a sale or an exchange.
Good order means that:
o You have provided adequate instructions
o There are no outstanding claims against your account
o There are no transaction limitations on your account
o If you have any Pioneer Fund share certificates, you submit them and they are signed by each record owner exactly as the shares are registered
o Your request includes a signature guarantee if you:
o Are selling over $100,000 or exchanging over $500,000 worth of shares
o Changed your account registration or address within the last 30 days
o Instruct the transfer agent to mail the check to an address different from the one on your account
o Want the check paid to someone other than the account owner(s)
o Are transferring the sale proceeds to a Pioneer mutual fund account with a different registration
Buying, Exchanging and Selling Pioneer Fund Shares
------------------------------------------------------------------------------------------------------
Buying Shares Exchanging Shares
------------------------------------------------------------------------------------------------------
Through your Normally, your investment firm will send your Normally, your investment firm will send your
investment firm purchase request to the Pioneer Funds' transfer exchange request to the Pioneer Fund's transfer
agent. Consult your investment professional for agent. Consult your investment professional for
more information. Your investment firm may receive more information about exchanging your shares.
a commission from the distributor for your
purchase of fund shares. The distributor or its
affiliates may pay additional compensation, out of
their own assets, to certain investment firms or
their affiliates based on objective criteria
established by the distributor
By phone or You can use the telephone or online privilege if After you establish your Pioneer Fund account, you
online you have an existing non-retirement account or can exchange Fund shares by phone or online if:
certain IRAs. You can purchase additional fund o You are exchanging into an existing account or
shares by phone if: using the exchange to establish a new account,
o You established your bank account of record at provided the new account has a registration
least 30 days ago identical to the original account
o Your bank information has not changed for at o The fund into which you are exchanging offers
least 30 days the same class of shares
o You are not purchasing more than $25,000 worth o You are not exchanging more than $500,000 worth
of shares per account per day of shares per account per day
o You can provide the proper account o You can provide the proper account identification
identification information information
When you request a telephone or online purchase,
the transfer agent will electronically debit the
amount of the purchase from your bank account of
record. The transfer agent will purchase Pioneer
Fund shares for the amount of the debit at the
offering price determined after the transfer agent
receives your telephone or online purchase
instruction and good funds. It usually takes three
business days for the transfer agent to receive
notification from your bank that good funds are
available in the amount of your investment.
In writing, by You can purchase Pioneer Fund shares for an existing You can exchange fund shares by mailing or faxing a
mail or
----------------------------------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------------------------------
Buying Shares Exchanging Shares
-----------------------------------------------------------------------------------------------------------
by fax fund account by mailing a check to the transfer letter of instruction to the transfer agent. You
agent. Make your check payable to the Pioneer can exchange Pioneer Fund shares directly through
Fund. Neither initial nor subsequent investments the Pioneer Fund only if your account is
should be made by third party check. Your check registered in your name. However, you may not fax
must be in U.S. dollars and drawn on a U.S. bank. an exchange request for more than $500,000.
Include in your purchase request the fund's name, Include in your letter:
the account number and the name or names in the o The name, social security number and signature
account registration. of all registered owners
o A signature guarantee for each registered owner
if the amount of the exchange is more than
$500,000
o The name of the fund out of which you are
exchanging and the name of the fund into which
you are exchanging
o The class of shares you are exchanging
The dollar amount or number of shares you are
exchanging
------------------------------------------------------------------------------------------------------------
Selling Shares How to contact Pioneer
------------------------------------------------------------------------------------------------------------
Normally, your investment firm will send your By phone
request to sell shares to the Pioneer Fund's
transfer agent. Consult your investment For information or to request a telephone
professional for more information. Each Pioneer transaction between 8:00 a.m. and 7:00 p.m.
Fund has authorized PFD to act as its agent in the (Eastern time) by speaking with a shareholder
repurchase of Pioneer Fund shares from qualified services representative call 1-800-225-6292
investment firms. Each Pioneer Fund reserves the To request a transaction using FactFone(SM) call
right to terminate this procedure at any time. 1-800-225-4321
Telecommunications Device for the Deaf (TDD)
You may sell up to $100,000 per account per day by 1-800-225-1997
phone or online. You may sell Pioneer Fund shares
held in a retirement plan account by phone only if By mail
your account is an eligible IRA (tax penalties may Send your written instructions to:
apply). You may not sell your shares by phone or Pioneer Investment Management Shareholder
online if you have changed your address (for Services, Inc.
checks) or your bank information (for wires and P.O. Box 55014
transfers) in the last 30 days. Boston, Massachusetts 02205-5014
You may receive your sale proceeds: By fax
o By check, provided the check is made payable Fax your exchange and sale requests to:
exactly as your account is registered 1-800-225-4240
o By bank wire or by electronic funds transfer,
provided the sale proceeds are being sent to Exchange Privilege
your bank address of record You may make up to four exchange redemptions of
You can sell some or all of your Pioneer Fund $25,000 or more per account per calendar year.
shares by writing directly to the Pioneer fund
only if your account is registered in your name.
Include in your request your name, your social
security number, the fund's name and any other
applicable requirements as described below. The
transfer agent will send the sale proceeds to your
address of record unless you provide other
instructions. Your request must be signed by all
registered owners and be in good order. You may
not sell more than $100,000 per account per day by
fax.
|
Pioneer Fund Shareholder Account Policies
Signature Guarantees and Other Requirements. You are required to obtain a signature guarantee when you are:
o Requesting certain types of exchanges or sales of Pioneer Fund shares
o Redeeming shares for which you hold a share certificate
o Requesting certain types of changes for your existing account
You can obtain a signature guarantee from most broker-dealers, banks, credit unions (if authorized under state law) and federal savings and loan associations. You cannot obtain a signature guarantee from a notary public. All Pioneer Funds will accept only medallion signature guarantees. A medallion signature guarantee may be obtained from a domestic bank or trust company, broker, dealer, clearing agency, savings association, or other financial institution that is participating in a medallion program recognized by the Securities Transfer Association. Signature guarantees from financial institutions that are not participating in one of these programs are not accepted. Fiduciaries and corporations are required to submit additional documents to sell Pioneer Fund shares.
Exchange Limitation. You may only make up to four exchange redemptions of $25,000 or more per account per calendar year out of a Pioneer Fund. Each Fund's exchange limitation is intended to discourage short-term trading in fund shares. Short-term trading can increase the expenses incurred by the Fund and make portfolio management less efficient. In determining whether the exchange redemption limit has been reached, Pioneer may aggregate a series of exchanges (each valued at less than $25,000) and/or fund accounts that appear to be under common ownership or control. Pioneer may view accounts for which one person gives instructions or accounts that act on advice provided by a single source to be under common control.
The exchange limitation does not apply to automatic exchange transactions or to exchanges made by participants in employer-sponsored retirement plans qualified under Section 401(a) of the Code. While financial intermediaries that maintain omnibus accounts that invest in the fund are requested to apply the exchange limitation policy to shareholders who hold shares through such accounts, we do not impose the exchange limitation policy at the level of the omnibus account and are not able to monitor compliance by the financial intermediary with this policy.
Redemption Fee. Pioneer International Core Equity Fund has adopted a redemption fee on short term holdings of the Fund's shares. If you sell or exchange shares within 30 days of any purchase of Fund shares, the Fund will apply a 2% fee to the entire amount of your sales proceeds. The Fund's redemption fee is intended to discourage short-term trading in fund shares. Short-term trading can increase the expenses incurred by the fund and make portfolio management less efficient.
Excessive Trading. Frequent trading into and out of the fund can disrupt portfolio management strategies, harm fund performance by forcing the fund to hold excess cash or to liquidate certain portfolio securities prematurely and increase expenses for all investors, including long-term investors who do not generate these costs. An investor may use short-term trading as a strategy, for example, if the investor believes that the valuation of the fund's portfolio securities for purposes of calculating its net asset value does not fully reflect the then current fair market value of those holdings. The fund discourages, and does not take any intentional action to accommodate, excessive and short-term trading practices, such as market timing. Although there is no generally applied standard in the marketplace as to what level of trading activity is excessive, we may consider trading in the fund's shares to be excessive for a variety of reasons, such as if:
o You sell shares within a short period of time after the shares were
purchased;
o You make two or more purchases and redemptions within a short period of
time;
o You enter into a series of transactions that is indicative of a timing
pattern or strategy; or
o We reasonably believe that you have engaged in such practices in
connection with other mutual funds.
The fund's Board of Trustees has adopted policies and procedures with respect to frequent purchases and redemptions of fund shares by fund investors. Pursuant to these policies and procedures, we monitor selected trades on a daily basis in an effort to detect excessive short-term trading. If we determine that an investor or a client of a broker has engaged in excessive short-term trading that we believe may be harmful to the fund, we will ask the investor or broker to cease such activity and we will refuse to process purchase orders (including purchases by exchange) of such investor, broker or accounts that we believe are under their control. In determining whether to take such actions, we seek to act in a manner that is consistent with the best interests of the fund's shareholders.
While we use our reasonable efforts to detect excessive trading activity, there can be no assurance that our efforts will be successful or that market timers will not employ tactics designed to evade detection. If we are not successful, your return from an investment in the fund may be adversely affected. Frequently, fund shares are held through omnibus accounts maintained by financial intermediaries such as brokers and retirement plan administrators, where the holdings of multiple
shareholders, such as all the clients of a particular broker, are aggregated. Our ability to monitor trading practices by investors purchasing shares through omnibus accounts is limited and dependent upon the cooperation of the financial intermediary in observing the fund's policies.
In addition to monitoring trades, the policies and procedures provide that:
o The fund imposes limitations on the number of exchanges out of an account holding the fund's Class A, Class B or Class C shares that may occur in any calendar year.
o Certain funds managed by Pioneer have adopted redemption fees that are incurred if you redeem shares within a short period after purchase, including exchanges. These redemption fees are described in the applicable prospectuses under "Fees and expenses."
o The fund may reject a purchase or exchange order before its acceptance or an order prior to issuance of shares. The fund may also restrict additional purchases or exchanges in an account. Each of these steps may be taken, for any reason, without prior notice, including transactions that the fund believes are requested on behalf of market timers. The fund reserves the right to reject any purchase request by any investor or financial institution if the fund believes that any combination of trading activity in the account or related accounts is potentially disruptive to the fund. A prospective investor whose purchase or exchange order is rejected will not achieve the investment results, whether gain or loss, that would have been realized if the order were accepted and an investment made in the fund. The fund and its shareholders do not incur any gain or loss as a result of a rejected order. The fund may impose further restrictions on trading activities by market timers in the future. The fund's prospectus will be amended or supplemented to reflect any material additional restrictions on trading activities intended to prevent excessive trading.
Minimum Account Size. Each Pioneer Fund requires that you maintain a minimum account value of $500. If you hold less than the minimum in your account because you have sold or exchanged some of your shares, the Pioneer Fund will notify you of its intent to sell your shares and close your account. You may avoid this by increasing the value of your account to at least the minimum within six months of the notice from the Fund.
Telephone Access. You may have difficulty contacting the Pioneer Fund by telephone during times of market volatility or disruption in telephone service. If you are unable to reach the Pioneer Fund by telephone, you should communicate with the Fund in writing.
Share Certificates Normally, your shares will remain on deposit with the transfer agent and certificates will not be issued. If you are legally required to obtain a certificate, you may request one for your Class A shares only. A fee may be charged for this service. Any share certificates of the AmSouth Funds outstanding at the Closing of the Reorganization will be deemed to be cancelled and will no longer represent shares of the Funds.
Other Policies. Each Pioneer Fund may suspend transactions in shares when trading on the New York Stock Exchange is closed or restricted, when an emergency exists that makes it impracticable, as determined by the SEC, for the fund to sell or value its portfolio securities or with the permission of the SEC.
Each Pioneer Fund or PFD may revise, suspend or terminate the account options and services available to shareholders at any time.
Each Pioneer Fund reserves the right to redeem in kind by delivering portfolio securities to a redeeming shareholder, provided that the Pioneer Fund must pay redemptions in cash if a shareholder's aggregate redemptions in a 90 day period are less than $250,000 or 1% of the fund's net assets.
Dividends and Capital Gains
Each Pioneer Fund generally pays any distributions of net short- and long-term capital gains and dividends from any net investment income at least annually.
Each Pioneer Fund may also pay dividends and capital gain distributions at other times if necessary for the fund to avoid U.S. federal income or excise tax. If you invest in a Pioneer Fund close to the time that the fund makes a distribution, generally you will pay a higher price per share and you will pay taxes on the amount of the distribution whether you reinvest the distribution or receive it as cash.
Taxes
For U.S. federal income tax purposes, distributions from each Pioneer Fund's net long-term capital gains (if any) are considered long-term capital gains and may be taxable to you at different maximum rates depending upon their source and other factors. Short-term capital gain distributions for each Pioneer Fund are taxable as ordinary income.
Dividends from net investment income are taxable either as ordinary income or, if so designated by the fund and certain other conditions, including holding period requirements, are met by the fund and the shareholder, as "qualified dividend income" taxable to individual shareholders at the maximum 15% U.S. federal tax rate. Dividends and distributions generally are taxable, whether you take payment in cash or reinvest them to buy additional Pioneer Fund shares.
When you sell or exchange Pioneer Fund shares you will generally recognize a capital gain or capital loss in an amount equal to the difference between the net amount of sale proceeds (or, in the case of an exchange, the fair market value of the shares) that you receive and your tax basis for the shares that you sell or exchange. In January of each year each Pioneer Fund will mail to you information about your dividends, distributions and any shares you sold in the previous calendar year.
You must provide your social security number or other taxpayer identification number to the fund along with the certifications required by the Internal Revenue Service when you open an account. If you do not or if it is otherwise legally required to do so, the Pioneer Fund will withhold 28% "backup withholding" tax from your dividends and distributions, sale proceeds and any other payments to you.
You should ask your tax adviser about any federal, state and foreign tax considerations, including possible additional withholding taxes for non-U.S. shareholders. You may also consult the "Tax Status" section of each Pioneer Fund's statement of additional information for a more detailed discussion of U.S. federal income tax considerations, including qualified dividend income considerations that may affect the Pioneer Fund and its shareholders.
Pioneer Funds' Rule 12b-1 Plans. As described above, each Pioneer Fund has adopted a Rule 12b-1 plan for its Class A shares, Class B shares, Class 2 shares and Class 3 shares (the "Plans"). Because the Rule 12b-1 fees payable under each Plan are an ongoing expense, over time they may increase the cost of your investment and your shares may cost more than shares that are not subject to a distribution or service fee or sales charge.
Compensation and Services. Each Class A Plan is a reimbursement plan, and distribution expenses of PFD are expected to substantially exceed the distribution fees paid by the fund in a given year. Pursuant to each Class A Plan the fund reimburses PFD for 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 board of trustees. The expenses of the fund pursuant to the Class A Plan are accrued daily at a rate which may not exceed the annual rate of 0.25% of the fund's average daily net assets attributable to Class A shares.
The Class B Plan provides that the fund shall pay to PFD, as the fund's distributor for its Class B shares a distribution fee equal on an annual basis to 0.75% of the fund's average daily net assets attributable to Class B shares and a service fee equal to 0.25% of the fund's average daily net assets attributable to Class B shares. The distribution fee compensates PFD for its distribution services with respect to Class B shares. PFD also pays commissions to broker-dealers and the cost of printing prospectuses and reports used for sales purposes and the preparation and printing of sales literature and other distribution-related expenses. The plan authorizes PFD to pay a service fee to broker-dealers at a rate of up to 0.25% of the fund's average daily net assets attributable to Class B shares owned by shareholders for whom that broker-dealer is the holder or dealer of record. This service fee compensates the broker-dealer for providing personal services and/or account maintenance services rendered by the broker-dealer with respect to Class B shares.
The Class 2 and Class 3 Plans (which pertain only to Pioneer Institutional Money Market Fund) provide that the fund will pay PFD, as the distributor of the shares, a distribution and service fee accrued daily and paid quarterly, equal on an annual
basis to 0.25% of the fund's average daily net assets attributable to Class 2 shares and 0.50% of the fund's average daily net assets attributable to Class 3 shares. These plans authorize PFD to pay securities dealers or other service organizations who agree to provide certain services to investors holding Class 1 and Class 2 shares a service fee of up to 0.25% of the fund's average daily net assets attributable to shares held by such investors. The plans also may compensate PFD for its distribution services with respect to these shares of the fund.
The Class B, Class 2 and Class 3 Plans are compensation plans, which provide for a fixed level of fees. Payments under these plans are not tied exclusively to actual distribution and service expenses, and may exceed (or may be less than) the expenses actually incurred.
Trustee Approval and Oversight. Each Plan was last approved by the board of trustees of each Pioneer Fund, including a majority of the independent trustees, by votes cast in person at meetings called for the purpose of voting on the Plan on December 2, 2004 (July 12, 2005 with respect to the Class 1 and Class 2 Plans for Pioneer Institutional Money Market Fund). Pursuant to the Plan, at least quarterly, PFD will provide each fund with a written report of the amounts expended under the Plan and the purpose for which these expenditures were made. The trustees review these reports on a quarterly basis to determine their continued appropriateness.
Term, Termination and Amendment. Each Plan's adoption, terms, continuance and termination are governed by Rule 12b-1 under the Investment Company Act. The board of trustees believes that there is a reasonable likelihood that the Plans will benefit each fund and its current and future shareholders. 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 fund affected thereby, and material amendments of the Plans must also be approved by the trustees as provided in Rule 12b-1.
FINANCIAL HIGHLIGHTS
The following tables show the financial performance of each Pioneer Fund for the past five fiscal years and, if applicable, for any recent semiannual period (or the period during which each Pioneer Fund has been in operation, if less than five years). Certain information reflects financial results for a single Pioneer Fund share. "Total return" shows how much an investment in a Pioneer Fund would have increased or decreased during each period, assuming you had reinvested all dividends and other distributions. In the case of each Pioneer Fund, each fiscal year ended on or after the fiscal year ended June 30, 2002 has been audited by Ernst & Young LLP, each Pioneer Fund's independent registered public accounting firm, as stated in their reports incorporated by reference in this registration statement. For fiscal years prior to the fiscal year ended June 30, 2002, the financial statements of each Pioneer Fund were audited by Arthur Andersen LLP, the Pioneer Funds' previous independent accountants. Arthur Andersen ceased operations in 2002. The information for any semiannual period has not been audited.
Pioneer Tax Free Money Market Fund
12/11/04 (a)
to
12/31/04
CLASS A
Net asset value, beginning of period $ 1.0000
--------
Increase from investment operations:
Net investment income $ 0.0004
--------
Distributions to shareowners:
Net investment income $(0.0004)
--------
Net asset value, end of period $ 1.0000
========
Total return* 0.04%(b)
Ratio of net expenses to average net assets 0.94%**
Ratio of net investment income to average net assets 1.38%**
Net assets, end of period (in thousands) $ 317
Ratios with no waiver of management fees by PIM:
Net expenses 1.17%**
Net investment income 1.15%**
|
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account.
** Annualized
(a) Initial issue date of Class A Shares.
(b) Not annualized.
The accompanying notes are an integral part of these financial statements.
Six Months
Ended
12/31/04 Year Ended Year Ended Year Ended Year Ended Year Ended
(unaudited) 6/30/04 6/30/03 6/30/02 (a) 6/30/01 6/30/00
CLASS A
Net asset value, beginning of period $ 9.18 $ 9.41 $ 8.89 $ 8.78 $ 8.47 $ 8.94
------- -------- -------- -------- ------- --------
Increase (decrease) from investment operations:
Net investment income $ 0.23 $ 0.41 $ 0.45 $ 0.52 $ 0.57 $ 0.58
Net realized and unrealized gain (loss) on investments 0.22 (0.14) 0.53 0.13 0.31 (0.47)
------- -------- -------- -------- ------- --------
Net increase from investment operations $ 0.45 $ 0.27 $ 0.98 $ 0.65 $ 0.88 $ 0.11
Distributions to shareowners:
Net investment income (0.25) (0.50) (0.46) (0.54) (0.57) (0.58)
------- -------- -------- -------- ------- --------
Net increase (decrease) in net asset value $ 0.20 $ (0.23) $ 0.52 $ 0.11 $ 0.31 $ (0.47)
------- -------- -------- -------- ------- --------
Net asset value, end of period $ 9.38 $ 9.18 $ 9.41 $ 8.89 $ 8.78 $ 8.47
------- -------- -------- -------- ------- --------
Total return* 4.92% 2.98% 11.38% 7.58% 10.70% 1.30%
Ratio of net expenses to average net assets+ 1.10%** 1.14% 1.20% 1.16% 1.21% 1.18%
Ratio of net investment income to average net assets+ 4.76%** 4.42% 5.02% 5.79% 6.53% 6.68%
Portfolio turnover rate 61%** 63% 48% 59% 43% 60%
Net assets, end of period (in thousands) $164,621 $160,421 $183,338 $143,713 $98,004 $102,349
Ratios with no waiver of management fees by PIM and no
reductions for fees paid indirectly:
Net expenses 1.17%** 1.14% 1.20% 1.16% 1.18% 1.15%
Net investment income 4.70%** 4.42% 5.02% 5.79% 6.56% 6.71%
Ratios with waiver of management fees by PIM and reduction
for fees paid indirectly:
Net expenses 1.10% 1.14% 1.20% 1.16% 1.18% 1.15%
Net investment income 4.76% 4.42% 5.02% 5.79% 6.56% 6.71%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratio with no reduction for fees paid indirectly.
(a) As a result of a change in accounting principle, the effect due to mandatory
accretion of discounts and amortization of premiums on debt securities
resulted in a reduction of net investment income of $0.02 per share, an
increase in net realized and unrealized gain (loss) on investments of $0.02
per share, and the ratio of net investment income to average net assets
decreased by 0.18%.
The accompanying notes are an integral part of these financial statements.
Pioneer Bond Fund
Six Months
Ended
12/31/04 Year Ended Year Ended Year Ended Year Ended Year Ended
(unaudited) 6/30/04 6/30/03 6/30/02 (a) 6/30/01 6/30/00
CLASS B
Net asset value, beginning of period $ 9.14 $ 9.37 $ 8.87 $ 8.77 $ 8.44 $ 8.91
------- ------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment gain $ 0.18 $ 0.33 $ 0.37 $ 0.44 $ 0.50 $ 0.50
Net realized and unrealized gain (loss) on investments 0.22 (0.14) 0.53 0.14 0.30 (0.46)
------- ------- ------- ------- ------- -------
Net increase from investment operations $ 0.41 $ 0.19 $ 0.90 $ 0.58 $ 0.80 $ 0.04
Distributions to shareowners:
Net investment income (0.21) (0.42) (0.40) (0.48) (0.47) (0.51)
------- ------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ 0.20 $ (0.23) $ 0.50 $ 0.10 $ 0.33 $ (0.47)
------- ------- ------- ------- ------- -------
Net asset value, end of period $ 9.34 $ 9.14 $ 9.37 $ 8.87 $ 8.77 $ 8.44
------- ------- ------- ------- ------- -------
Total return* 4.50% 2.04% 10.44% 6.78% 9.71% 0.48%
Ratio of net expenses to average net assets+ 2.00%** 1.98% 2.02% 1.95% 2.05% 2.05%
Ratio of net investment income to average net assets+ 3.87%** 3.55% 4.22% 5.02% 5.72% 5.81%
Portfolio turnover rate 61%** 63% 48% 59% 43% 60%
Net assets, end of period (in thousands) $54,351 $57,774 $77,367 $59,729 $38,231 $37,269
Ratios with no waiver of management fees by PIM and no
reduction for fees paid indirectly:
Net expenses 2.02%** 1.98% 2.02% 1.95% 2.04% 2.03%
Net investment income 3.85%** 3.55% 4.22% 5.02% 5.73% 5.83%
Ratios with waiver of management fees by PIM and
reduction for fees paid indirectly:
Net expenses 2.00% 1.98% 2.02% 1.95% 2.04% 2.03%
Net investment income 3.87% 3.55% 4.22% 5.02% 5.73% 5.83%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratio with no reduction for fees paid indirectly.
(a) As a result of a change in accounting principle, the effect due to mandatory
accretion of discounts and amortization of premiums on debt securities
resulted in a reduction of net investment income of $0.02 per share, an
increase in net realized and unrealized gain (loss) on investments of $0.02
per share, and the ratio of net investment income to average net assets
decreased by 0.18%.
The accompanying notes are an integral part of these financial statements.
Pioneer Bond Fund
Six Months
Ended
12/31/04 Year Ended Year Ended Year Ended Year Ended Year Ended
(unaudited) 6/30/04 6/30/03 6/30/02 (a) 6/30/01 6/30/00
CLASS C
Net asset value, beginning of period $ 9.11 $ 9.31 $ 8.83 $ 8.73 $ 8.46 $ 8.89
------- ------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.18 $ 0.33 $ 0.37 $ 0.44 $ 0.48 $ 0.48
Net realized and unrealized gain (loss) on investments 0.22 (0.14) 0.51 0.12 0.30 (0.45)
------- ------- ------- ------- ------- -------
Net increase from investment operations $ 0.41 $ 0.19 $ 0.88 $ 0.56 $ 0.78 $ 0.03
Distributions to shareowners:
Net investment income (0.21) (0.39) (0.40) (0.46) (0.51) (0.46)
------- ------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ 0.20 $ (0.20) $ 0.48 $ 0.10 $ 0.27 $ (0.43)
------- ------- ------- ------- ------- -------
Net asset value, end of period $ 9.31 $ 9.11 $ 9.31 $ 8.83 $ 8.73 $ 8.46
------- ------- ------- ------- ------- -------
Total return* 4.54% 2.11% 10.28% 6.55% 9.46% 0.36%
Ratio of net expenses to average net assets+ 1.94%** 1.97% 2.16% 2.14% 2.18% 2.32%
Ratio of net investment income to average net assets+ 3.92%** 3.59% 4.05% 4.78% 5.56% 5.53%
Portfolio turnover rate 61%** 63% 48% 59% 43% 60%
Net assets, end of period (in thousands) $28,110 $27,545 $29,777 $18,067 $ 7,377 $ 6,264
Ratios with no waiver of management fees by PIM and no
reduction for fees paid indirectly:
Net expenses 1.96%** 1.97% 2.16% 2.15% 2.15% 2.30%
Net investment income 3.91%** 3.59% 4.05% 4.77% 5.59% 5.55%
Ratios with waiver of management fees by PIM and
reduction for fees paid indirectly:
Net expenses 1.94% 1.97% 2.16% 2.15% 2.15% 2.30%
Net investment income 3.92% 3.59% 4.05% 4.77% 5.59% 5.55%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratio with no reduction for fees paid indirectly.
(a) As a result of a change in accounting principle, the effect due to mandatory
accretion of discounts and amortization of premiums on debt securities
resulted in a reduction of net investment income of $0.02 per share, an
increase in net realized and unrealized gain (loss) on investments of $0.02
per share, and the ratio of net investment income to average net assets
decreased by 0.18%.
The accompanying notes are an integral part of these financial statements.
Pioneer Bond Fund
Six Months
Ended Year Year 9/20/01(a)
12/31/04 Ended Ended to
(unaudited) 6/30/04 6/30/03 6/30/02(b)
CLASS Y
Net asset value, beginning of period $ 9.12 $ 9.35 $ 8.87 $ 8.85
------- ------- ------- --------
Increase (decrease) from investment operations:
Net investment income $ 0.25 $ 0.46 $ 0.51 $ 0.43
Net realized and unrealized gain (loss) on investments 0.22 (0.14) 0.51 0.04
------- ------- ------- --------
Net increase from investment operations $ 0.47 $ 0.32 $ 1.02 $ 0.47
Distributions to shareowners:
Net investment income (0.27) (0.55) (0.54) (0.45)
Net increase (decrease) in net asset value $ 0.20 $ (0.23) $ 0.48 $ 0.02
------- ------- ------- --------
Net asset value, end of period $ 9.32 $ 9.12 $ 9.35 $ 8.87
------- ------- ------- --------
Total return* 5.22% 3.48% 11.86% 5.48%
Ratio of net expenses to average net assets+ 0.60%** 0.58% 0.67% 0.64%**
Ratio of net investment income to average net assets+ 5.21%** 5.05% 5.54% 6.28%**
Portfolio turnover rate 61%** 63% 48% 59%
Net assets, end of period (in thousands) $10,848 $13,617 $ 7,719 $ 4,051
Ratios with no waiver of management fees by PIM and no
reduction for fees paid indirectly:
Net expenses 0.60%** 0.58% 0.67% 0.64%**
Net investment income 5.21%** 5.05% 5.54% 6.28%**
Ratios with waiver of management fees by PIM and reduction
for fees paid indirectly:
Net expenses 0.60% 0.58% 0.67% 0.64%
Net investment income 5.21% 5.05% 5.54% 6.28%
|
(a) Class Y shares were first publicly offered on September 20, 2001.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, and the complete redemption of
the investment at net asset value at each end of each period.
** Annualized
+ Ratio with no reduction for fees paid indirectly.
(b) As a result of a change in accounting principle, the effect due to mandatory
accretion of discounts and amortization of premiums on debt securities
resulted in a reduction of net investment income of $0.02 per share, an
increase in net realized and unrealized gain (loss) on investments of $0.02
per share, and the ratio of net investment income to average net assets
decreased by 0.23%.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
CLASS A
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Increase from investment operations:
Net investment income $ 0.005 $ 0.003 $ 0.01 $ 0.03 $ 0.05
-------- -------- -------- -------- --------
Distributions to shareowners:
Net investment income (0.005) (0.003) (0.01) (0.03) (0.05)
-------- -------- -------- -------- --------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Total return* 0.45% 0.26% 1.15% 3.29% 5.53%
Ratio of net expenses to average net assets+ 0.93% 1.00% 0.76% 0.93% 1.02%
Ratio of net investment income to average net assets+ 0.45% 0.26% 1.18% 2.89% 5.36%
Net assets, end of period (in thousands) $192,860 $227,052 $268,861 $493,871 $242,861
Ratios with no waiver of management fees and assumptions of
expenses by PIM and no reductions for fees paid indirectly:
Net expenses 0.93% 1.06% 0.93% 0.94% 1.02%
Net investment income 0.45% 0.20% 1.01% 2.88% 5.36%
Ratios with waiver of management fees and assumptions of
expenses by PIM and reductions for fees paid indirectly:
Net expenses 0.93% 0.99% 0.75% 0.89% 0.94%
Net investment income 0.45% 0.27% 1.19% 2.93% 5.44%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
CLASS B
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- -------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.001 $ 0.001 $ 0.003 $ 0.02 $ 0.05
------- ------- -------- ------- -------
Distributions to shareowners:
Net investment income (0.001) (0.001) (0.003) (0.02) (0.05)
------- ------- -------- ------- -------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- -------- ------- -------
Total return* 0.06% 0.05% 0.33% 2.42% 4.64%
Ratio of net expenses to average net assets+ 1.33% 1.21% 1.59% 1.79% 1.86%
Ratio of net investment income to average net assets+ 0.06% 0.05% 0.31% 2.08% 4.49%
Net assets, end of period (in thousands) $46,559 $59,059 $ 84,901 $55,837 $34,693
Ratios with no waiver of management fees and assumptions of
expenses by PIM and no reductions for fees paid indirectly:
Net expenses 1.81% 1.87% 1.81% 1.79% 1.86%
Net investment income (loss) (0.43)% (0.61)% 0.09% 2.08% 4.49%
Ratios with waiver of management fees and assumptions of
expenses by PIM and reductions for fees paid indirectly:
Net expenses 1.33% 1.21% 1.58% 1.77% 1.80%
Net investment income 0.06% 0.05% 0.32% 2.10% 4.55%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
CLASS C
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- -------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.001 $ 0.001 $ 0.003 $ 0.02 $ 0.04
------- ------- -------- ------- -------
Distributions to shareowners:
Net investment income (0.001) (0.001) (0.003) (0.02) (0.04)
------- ------- -------- ------- -------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- -------- ------- -------
Total return* 0.06% 0.05% 0.28% 2.33% 4.54%
Ratio of net expenses to average net assets+ 1.33% 1.19% 1.64% 1.90% 2.00%
Ratio of net investment income to average net assets+ 0.06% 0.05% 0.27% 2.09% 4.27%
Net assets, end of period (in thousands) $34,413 $32,216 $ 33,633 $17,118 $11,195
Ratios with no waiver of management fees and assumptions of
expenses by PIM and no reductions for fees paid indirectly:
Net expenses 1.70% 1.86% 1.88% 1.91% 2.00%
Net investment income (loss) (0.31)% (0.62)% 0.02% 2.08% 4.27%
Ratios with waiver of management fees and assumptions of
expenses by PIM and reductions for fees paid indirectly:
Net expenses 1.33% 1.19% 1.62% 1.87% 1.87%
Net investment income 0.06% 0.05% 0.28% 2.12% 4.40%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
PIONEER GROWTH OPPORTUNITIES FUND
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
12/31/04(a) 12/31/03 12/31/02 12/31/01 12/31/00
CLASS A
Net asset value, beginning of period $ 24.38 $ 16.97 $ 26.96 $ 22.16 $ 23.21
-------- -------- -------- -------- --------
Net increase (decrease) from investment operations:
Net investment income (loss) $ (0.14)(b) $ (0.16) $ (0.24) $ (0.20) $ (0.25)
Net realized and unrealized gain (loss) on investments 5.56 7.56 (9.77)++ 5.00 (0.80)
-------- -------- -------- -------- --------
Net increase from investment operations $ 5.42 $ 7.40 $ (10.01) $ 4.80 $ (1.05)
-------- -------- -------- -------- --------
Redemption fees $ 0.00(c) $ 0.01 $ 0.02 $ -- $ --
Net increase in net asset value $ 5.42 $ 7.41 $ (9.99) $ 4.80 $ (1.05)
-------- -------- -------- -------- --------
Net asset value, end of period $ 29.80 $ 24.38 $ 16.97 $ 26.96 $ 22.16
======== ======== ======== ======== ========
Total return* 22.23% 43.67% (37.05)% 21.66% (4.52)%
Ratio of net expenses to average net assets 1.31% 1.33% 1.33% 1.31% 1.31%
Ratio of net investment income (loss) to average net assets (0.55)% (0.70)% (1.17)% (1.00)% (1.00)%
Portfolio turnover rate 17% 46% 37% 65% 63%
Net assets, end of period (in thousands) $ 23,225 $ 21,475 $ 19,024 $ 33,877 $ 26,020
Ratios with no waiver of fees:
Net expenses 2.29% 2.38% 1.67% 1.36% 1.49%
Net investment loss (1.53)% (1.75)% (1.51)% (1.05)% (1.18)%
|
(a) Effective August 2, 2004, PIM became the sub-advisor of the Fund and
subsequently became the advisor on December 10, 2004.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions and the complete redemption of
the investment at net asset value at the end of each period.
++ Includes $0.10 related to investment reimbursement by affiliate.
(b) Net Investment income per share has been calculated using the average
shares method.
(c) Rounds to less than $0.01 cent per share.
The accompanying notes are an integral part of these financial statements.
PIONEER GROWTH OPPORTUNITIES FUND
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
12/31/04(a) 12/31/03 12/31/02 12/31/01 12/31/00
CLASS B
Net asset value, beginning of period $ 23.05 $ 16.16 $ 25.87 $ 21.42 $ 22.57
-------- -------- -------- -------- --------
Net increase (decrease) from investment operations:
Net investment income (loss) $ (0.47)(b) $ (0.28) $ (0.39) $ (0.40) $ (0.41)
Net realized and unrealized gain (loss) on investments 5.36 7.16 (9.34)++ 4.85 (0.74)
-------- -------- -------- -------- --------
Net increase from investment operations $ 4.89 $ 6.88 $ (9.73) $ 4.45 $ (1.15)
-------- -------- -------- -------- --------
Redemption fees $ 0.00(c) $ 0.01 $ 0.02 $ -- $ --
Net increase in net asset value $ 4.89 $ 6.89 $ (9.71) $ 4.45 $ (1.15)
-------- -------- -------- -------- --------
Net asset value, end of period $ 27.94 $ 23.05 $ 16.16 $ 25.87 $ 21.42
======== ======== ======== ======== ========
Total return* 21.21% 42.64% (37.53)% 20.77% (5.10)%
Ratio of net expenses to average net assets 2.08% 2.08% 2.08% 2.06% 2.06%
Ratio of net investment (loss) to average net assets (1.37)% (1.43)% (1.92)% (1.75)% (1.71)%
Portfolio turnover rate 17% 46% 37% 65% 63%
Net assets, end of period (in thousands) $ 10 $ 11,126 $ 8,734 $ 14,346 $ 12,391
Ratios with no waiver of fees:
Net expenses 2.33% 2.45% 2.21% 2.09% 2.16%
Net investment loss (1.63)% (1.80)% (2.05)% (1.78)% (1.81)%
|
(a) Effective August 2, 2004, PIM became the sub-advisor of the Fund and
subsequently became the advisor on December 10, 2004.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions and the complete redemption of
the investment at net asset value at the end of each period.
++ Includes $0.10 related to investment reimbursement by affiliate.
(b) Net Investment income per share has been calculated using the average
shares method.
(c) Rounds to less than $0.01 cent per share.
The accompanying notes are an integral part of these financial statements.
PIONEER GROWTH OPPORTUNITIES FUND
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED PERIOD ENDED
12/31/04(a) 12/31/03 12/31/02 12/31/01 12/31/00(b)
CLASS C
Net asset value, beginning of period $ 23.05 $ 16.16 $ 25.85 $ 21.40 $ 23.34
------- ------- ------- -------- -------
Net increase (decrease) from investment operations:
Net investment income (loss) $ (0.33)(c) $ (0.29) $ (0.33) $ (0.35) $ (0.23)
Net realized and unrealized gain (loss) on
investments 5.22 7.17 (9.38)++ 4.80 (1.71)
------- ------- ------- -------- -------
Net increase from investment operations $ 4.89 $ 6.88 $ (9.71) $ 4.45 $ (1.94)
------- ------- ------- -------- -------
Redemption fees $ 0.00(d) $ 0.01 $ 0.02 $ -- $ --
Net increase in net asset value $ 4.89 $ 6.89 $ (9.69) $ 4.45 $ (1.94)
------- ------- ------- -------- -------
Net asset value, end of period $ 27.94 $ 23.05 $ 16.16 $ 25.85 $ 21.40
======= ======= ======= ======== =======
Total return* 21.21% 42.64% 37.49)% 20.74% (8.27)%***
Ratio of net expenses to average net assets 2.08% 2.08% 2.08% 2.06% 2.02%**
Ratio of net investment (loss) to average net assets (1.35)% (1.45)% (1.93)% (1.75)% (1.71)%**
Portfolio turnover rate 17% 46% 37% 65% 63%
Net assets, end of period (in thousands) $ 10 $ 198 $ 161 $ 194 $ 120
Ratios with no waiver of fees:
Net expenses 2.35% 2.48% 2.33% 2.06% 2.02%**
Net investment loss (1.62)% (1.85)% (2.18)% (1.75)% (1.71)%**
|
(a) Effective August 2, 2004, PIM became the sub-advisor of the Fund and
subsequently became the advisor on December 10, 2004.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions and the complete redemption of
the investment at net asset value at the end of each period.
++ Includes $0.10 related to investment reimbursement by affiliate.
** Annualized
*** Not Annualized
(b) For the period from April 30, 2000 (initial issue date of Class C shares)
through December 31, 2000.
(c) Net Investment income per share has been calculated using the average
shares method.
(d) Amount rounds to less than $0.01 cent per share.
The accompanying notes are an integral part of these financial statements.
Pioneer Ibbotson Asset Allocation Series
Moderate Allocation Fund
For the period 8/9/04(a) to 1/31/05
-----------------------------------------
Class A Class B Class C
Net asset value, beginning of period $ 10.00 $ 10.00 $ 10.00
-------- ------- --------
Increase (decrease) from investment operations:
Net investment income (loss) (b) $ 0.06 $ 0.01 $ 0.07
Net realized and unrealized gain (loss) on investments 0.84 0.54 0.40
-------- ------- --------
Net increase (decrease) from investment operations $ 0.90 $ 0.55 $ 0.47
-------- ------- --------
Distributions to shareowners:
Net investment income $ (0.04) $ - $ (0.01)
Net realized gain (0.23) (0.23) (0.23)
-------- ------- --------
Net increase (decrease) in net asset value $ 0.63 $ 0.32 $ 0.23
-------- ------- --------
Net asset value, end of period $ 10.63 $ 10.32 $ 10.23
======== ======= ========
Total return* 9.04% 5.51% 4.72%
Ratio of net expenses to average net assets**++ 0.90% 1.80% 1.80%
Ratio of net investment income to average net assets** 1.15% 0.19% 1.37%
Portfolio turnover rate** 20% 20% 20%
Net assets, end of period (in thousands) $ 13,612 $ 3,274 $ 5,327
|
(a) Commencement of operations.
(b) Calculated using average shares outstanding for the period.
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account.
** Annualized.
++ In the absence of expense reimbursement, expenses on an annualized basis would have been 2.84%, 4.35% and 3.92% of average net assets, respectively, for Class A, Class B and Class C shares.
The accompanying notes are an integral part of these financial statements.
Pioneer Ibbotson Asset Allocation Series
Growth Allocation Fund
For the period 8/9/04(a) to 1/31/05
-----------------------------------------
Class A Class B Class C
Net asset value, beginning of period $ 10.00 $ 10.00 $ 10.00
-------- -------- --------
Increase (decrease) from investment operations:
Net investment income (loss) (b) $ 0.03 $ 0.04 $ 0.02
Net realized and unrealized gain (loss) on investments 1.09 0.16 0.75
-------- -------- --------
Net increase (decrease) from investment operations $ 1.12 $ 0.20 $ 0.77
-------- -------- --------
Distributions to shareowners:
Net investment income $ (0.03) $ - $ (0.01)
Net realized gain (0.25) (0.25) (0.25)
-------- -------- --------
Net increase (decrease) in net asset value $ 0.84 $ (0.05) $ 0.51
-------- -------- --------
Net asset value, end of period $ 10.84 $ 9.95 $ 10.51
======== ======== ========
Total return* 11.19% 1.95% 7.62%
Ratio of net expenses to average net assets**++ 0.93% 1.83% 1.83%
Ratio of net investment income to average net assets** 0.62% 0.72% 0.37%
Portfolio turnover rate** 13% 13% 13%
Net assets, end of period (in thousands) $ 11,580 $ 3,226 $ 6,106
|
(a) Commencement of operations.
(b) Calculated using average shares outstanding for the period.
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account.
** Annualized.
++ In the absence of expense reimbursement, expenses on an annualized basis would have been 3.73%, 5.34% and 5.05% of average net assets, respectively, for Class A, Class B and Class C shares.
The accompanying notes are an integral part of these financial statements.
Pioneer Ibbotson Asset Allocation Series
Aggressive Allocation Fund
For the period 8/9/04(a) to 1/31/05
-----------------------------------------
Class A Class B Class C
Net asset value, beginning of period $ 10.00 $ 10.00 $ 10.00
------- ------- -------
Increase (decrease) from investment operations:
Net investment income (loss) (b) $ - $ 0.01 $ (0.01)
Net realized and unrealized gain (loss) on investments 1.36 0.97 1.13
------- ------- -------
Net increase (decrease) from investment operations $ 1.36 $ 0.98 $ 1.12
------- ------- -------
Distributions to shareowners:
Net investment income $ (0.02) $ - $ -
Net realized gain (0.30) (0.30) (0.30)
------- ------- -------
Net increase (decrease) in net asset value $ 1.04 $ 0.68 $ 0.82
------- ------- -------
Net asset value, end of period $ 11.04 $ 10.68 $ 10.82
======= ======= =======
Total return* 13.54% 9.73% 11.12%
Ratio of net expenses to average net assets**++ 0.93% 1.83% 1.83%
Ratio of net investment income (loss) to average net assets** (0.02)% 0.18% (0.11)%
Portfolio turnover rate** 12% 12% 12%
Net assets, end of period (in thousands) $ 6,604 $ 1,962 $ 3,113
|
(a) Commencement of operations.
(b) Calculated using average shares outstanding for the period.
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account.
** Annualized.
++ In the absence of expense reimbursement, expenses on an annualized basis would have been 6.66%, 9.32% and 8.70% of average net assets, respectively, for Class A, Class B and Class C shares.
The accompanying notes are an integral part of these financial statements.
Pioneer Mid Cap Value Fund
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS A 10/31/04 10/31/03 10/31/02 10/31/01 10/31/00
Net asset value, beginning of period $ 22.25 $ 16.93 $ 19.29 $ 20.83 $ 19.90
---------- ---------- ------- -------- --------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.01 $ 0.04 $ (0.02) $ (0.01) $ 0.11
Net realized and unrealized gain (loss) on investments,
options and foreign currency transactions 3.83 5.28 (0.97) 0.34 3.46
---------- ---------- ------- -------- --------
Net increase (decrease) from investment operations $ 3.84 $ 5.32 $ (0.99) $ 0.33 $ 3.57
Distributions to shareowners:
Net investment income - - - - -
Net realized gain (0.52) - (1.37) (1.87) (2.64)
---------- ---------- ------- -------- --------
Net increase (decrease) in net asset value $ 3.32 $ 5.32 $ (2.36) $ (1.54) $ 0.93
---------- ---------- ------- -------- --------
Net asset value, end of period $ 25.57 $ 22.25 $ 16.93 $ 19.29 $ 20.83
========== ========== ======= ======== ========
Total return* 17.65% 31.42% (5.99)% 1.85% 20.00%
Ratio of net expenses to average net assets+ 1.21% 1.37% 1.30% 1.24% 1.13%
Ratio of net investment income (loss) to average
net assets+ 0.05% 0.24% (0.09)% 0.01% 0.27%
Portfolio turnover rate 59% 58% 65% 95% 70%
Net assets, end of period (in thousands) $1,547,823 $1,208,400 $890,856 $921,310 $945,583
Ratios with reduction for fees paid indirectly:
Net expenses 1.21% 1.37% 1.30% 1.22% 1.11%
Net investment income (loss) 0.05% 0.24% (0.09)% 0.03% 0.29%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Mid Cap Value Fund
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS B 10/31/04 10/31/03 10/31/02 10/31/01 10/31/00
Net asset value, beginning of period $ 20.48 $ 15.72 $ 18.14 $ 19.85 $ 19.22
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment loss $ (0.22) $ (0.13) $ (0.18) $ (0.10) $ (0.20)
Net realized and unrealized gain (loss) on investments,
options and foreign currency transactions 3.55 4.89 (0.87) 0.26 3.47
------- ------- ------- ------- -------
Net increase (decrease) from investment operations $ 3.33 $ 4.76 $ (1.05) $ 0.16 $ 3.27
Distributions to shareowners:
Net investment income - - - - -
Net realized gain (0.49) - (1.37) (1.87) (2.64)
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ 2.84 $ 4.76 $ (2.42) $ (1.71) $ 0.63
------- ------- ------- ------- -------
Net asset value, end of period $ 23.32 $ 20.48 $ 15.72 $ 18.14 $ 19.85
======= ======= ======= ======= =======
Total return* 16.64% 30.28% (6.75)% 1.01% 19.04%
Ratio of net expenses to average net assets+ 2.13% 2.22% 2.10% 2.03% 1.91%
Ratio of net investment loss to average net assets+ (0.86)% (0.61)% (0.89)% (0.78)% (0.52)%
Portfolio turnover rate 59% 58% 65% 95% 70%
Net assets, end of period (in thousands) $208,844 $241,313 $264,881 $330,926 $336,301
Ratios with reduction for fees paid indirectly:
Net expenses 2.13% 2.22% 2.10% 2.01% 1.90%
Net investment loss (0.86)% (0.61)% (0.89)% (0.76)% (0.51)%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Mid Cap Value Fund
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS C 10/31/04 10/31/03 10/31/02 10/31/01 10/31/00
Net asset value, beginning of period $ 20.34 $ 15.61 $ 18.04 $ 19.76 $ 19.16
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.16) $ (0.10) $ (0.16) $ 0.03 $ (0.26)
Net realized and unrealized gain (loss) on investments,
options and foreign currency transactions 3.46 4.83 (0.90) 0.12 3.50
------- ------- ------- ------- -------
Net increase (decrease) from investment operations $ 3.30 $ 4.73 $ (1.06) $ 0.15 $ 3.24
Distributions to shareowners:
Net investment income - - - - -
Net realized gain (0.49) - (1.37) (1.87) (2.64)
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ 2.81 $ 4.73 $ (2.43) $ (1.72) $ 0.60
------- ------- ------- ------- -------
Net asset value, end of period $ 23.15 $ 20.34 $ 15.61 $ 18.04 $ 19.76
======= ======= ======= ======= =======
Total return* 16.60% 30.30% (6.85)% 0.96% 18.92%
Ratio of net expenses to average net assets+ 2.11% 2.28% 2.20% 2.11% 2.01%
Ratio of net investment loss to average net assets+ (0.88)% (0.68)% (0.99)% (0.86)% (0.61)%
Portfolio turnover rate 59% 58% 65% 95% 70%
Net assets, end of period (in thousands) $105,778 $53,982 $34,605 $29,547 $24,495
Ratios with reduction for fees paid indirectly:
Net expenses 2.11% 2.28% 2.20% 2.09% 1.98%
Net investment loss (0.88)% (0.68)% (0.99)% (0.84)% (0.58)%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Mid Cap Value Fund
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS Y 10/31/04 10/31/03 10/31/02 10/31/01 10/31/00
Net asset value, beginning of period $ 22.73 $ 17.21 $ 19.50 $ 20.94 $ 19.91
------- -------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.08 $ 0.15 $ 0.06 $ 0.07 $ 0.20
Net realized and unrealized gain (loss) on investments,
options and foreign currency transactions 3.96 5.37 (0.98) 0.36 3.47
------- -------- ------- ------- -------
Net increase (decrease) from investment operations $ 4.04 $ 5.52 $ (0.92) $ 0.43 $ 3.67
Distributions to shareowners:
Net investment income - - - - -
Net realized gain (0.60) - (1.37) (1.87) (2.64)
------- -------- ------- ------- -------
Net increase (decrease) in net asset value $ 3.44 $ 5.52 $ (2.29) $ (1.44) $ 1.03
------- -------- ------- ------- -------
Net asset value, end of period $ 26.17 $ 22.73 $ 17.21 $ 19.50 $ 20.94
======= ======== ======= ======= =======
Total return* 18.23% 32.07% (5.54)% 2.36% 20.56%
Ratio of net expenses to average net assets+ 0.78% 0.84% 0.84% 0.76% 0.63%
Ratio of net investment income to average net assets+ 0.46% 0.76% 0.37% 0.49% 0.77%
Portfolio turnover rate 59% 58% 65% 95% 70%
Net assets, end of period (in thousands) $50,081 $ 8,261 $ 6,318 $ 3,642 $ 3,376
Ratios with reduction for fees paid indirectly:
Net expenses 0.78% 0.84% 0.83% 0.75% 0.61%
Net investment income 0.46% 0.76% 0.38% 0.50% 0.79%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, and the complete redemption of
the investment at net asset value at the end of each period.
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Oak Ridge Large Cap Growth Fund
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS A 11/30/04 11/30/03 11/30/02 11/30/01 11/30/00
Net asset value, beginning of period $ 11.18 $ 10.74 $ 12.41 $ 13.89 $ 12.45
------- ------- -------- -------- -------
Increase (decrease) from investment operations:
Net investment loss $ (0.01) $ (0.11) $ (0.10) $ (0.07) $ (0.09)
Net realized and unrealized gain (loss) on investments 1.34 1.17 (1.57) (1.41) 1.53
------- ------- -------- -------- -------
Net increase (decrease) from investment operations $ 1.33 $ 1.06 $ (1.67) $ (1.48) $ 1.44
Distributions to shareowners:
Net realized gain - (0.62) - - -
------- ------- -------- -------- -------
Net increase (decrease) in net asset value $ 1.33 $ 0.44 $ (1.67) $ (1.48) $ 1.44
------- ------- -------- -------- -------
Net asset value, end of period $ 12.51 $ 11.18 $ 10.74 $ 12.41 $ 13.89
======= ======= ======== ======== =======
Total return* 11.90% 10.63% (13.46)% (10.66)% 11.57%
Ratio of net expenses to average net assets+ 1.57% 2.00% 2.00% 2.00% 2.00%
Ratio of net investment loss to average net assets+ (0.11)% (1.06)% (1.00)% (0.60)% (0.68)%
Portfolio turnover rate 29% 53% 26% 19% 25%
Net assets, end of period (in thousands) $37,193 $ 8,640 $ 8,069 $ 2,733 $ 2,530
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 2.42% 2.77% 3.21% 5.24% 4.72%
Net investment loss (0.97)% (1.83)% (2.21)% (3.84)% (3.40)%
Ratios with waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 1.57% 2.00% 2.00% 2.00% 2.00%
Net investment loss (0.11)% (1.06)% (1.00)% (0.60)% (0.68)%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Oak Ridge Large Cap Growth Fund
2/17/04 (a)
to
CLASS B 11/30/04
Net asset value, beginning of period $ 11.86
--------
Increase from investment operations:
Net investment loss $ (0.02)
Net realized and unrealized gain on investments 0.60
--------
Net increase from investment operations $ 0.58
--------
Net increase in net asset value $ 0.58
--------
Net asset value, end of period $ 12.44
========
Total return* 4.89%
Ratio of net expenses to average net assets+ 2.53%**
Ratio of net investment loss to average net assets+ (0.72)%**
Portfolio turnover rate 29%
Net assets, end of period (in thousands) $ 4,161
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 2.94%**
Net investment loss (1.13)%**
Ratios with waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 2.52%**
Net investment loss (0.72)%**
|
(a) Class B shares were first publicly offered on February 17, 2004.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Oak Ridge Large Cap Growth Fund
FINANCIAL HIGHLIGHTS
2/17/04 (a)
to
CLASS C 11/30/04
Net asset value, beginning of period $ 11.86
--------
Increase (decrease) from investment operations:
Net investment loss $ (0.01)
Net realized and unrealized gain on investments 0.60
--------
Net increase from investment operations $ 0.59
--------
Net increase in net asset value $ 0.59
--------
Net asset value, end of period $ 12.45
========
Total return* 4.97%
Ratio of net expenses to average net assets+ 2.39%**
Ratio of net investment loss to average net assets+ (0.40)%**
Portfolio turnover rate 29%
Net assets, end of period (in thousands) $ 14,601
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 2.71%**
Net investment loss (0.72)%**
Ratios with waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 2.38%**
Net investment loss (0.40)%**
|
(a) Class C shares were first publicly offered on February 17, 2004.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Oak Ridge Large Cap Growth Fund
8/11/04 (a)
to
11/30/04
CLASS Y
Net asset value, beginning of period $ 11.33
-------
Increase from investment operations:
Net investment income $ 0.03
Net realized and unrealized gain on investments 1.17
-------
Net increase from investment operations $ 1.20
-------
Net increase in net asset value $ 1.20
-------
Net asset value, end of period $ 12.53
=======
Total return* 10.59%
Ratio of net expenses to average net assets+ 1.09%**
Ratio of net investment income to average net assets+ 2.97%**
Portfolio turnover rate 29%
Net assets, end of period (in thousands) $31,385
Ratios with no waiver of management fees and assumption of
expenses by PIM and no reduction for fees paid indirectly:
Net expenses 1.19%**
Net investment income 2.87%**
Ratios with no waiver of management fees and assumption of
expenses by PIM and reduction for fees paid indirectly:
Net expenses 1.09%**
Net investment income 2.97%**
|
(a) Class Y shares were first publicly offered on August 11, 2004.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS A 12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
Net asset value, beginning of period $ 38.00 $ 30.76 $ 38.87 $ 44.26 $ 47.60
---------- ---------- --------- --------- ----------
Increase (decrease) from investment operations:
Net investment income $ 0.35 $ 0.28 $ 0.27 $ 0.18 $ 0.16
Net realized and unrealized gain (loss) on investments 4.05 7.24 (8.12) (5.11) (0.14)
---------- ---------- --------- --------- ----------
Net increase (decrease) from investment operations $ 4.40 $ 7.52 $ (7.85) $ (4.93) $ 0.02
Distributions to shareowners:
Net investment income (0.34) (0.28) (0.26) (0.16) (0.12)
Net realized gain - - - (0.30) (3.24)
---------- ---------- --------- --------- ----------
Net increase (decrease) in net asset value $ 4.06 $ 7.24 $ (8.11) $ (5.39) $ (3.34)
---------- ---------- --------- --------- ----------
Net asset value, end of period $ 42.06 $ 38.00 $ 30.76 $ 38.87 $ 44.26
========== ========== ========= ========= ==========
Total return* 11.64% 24.58% (20.26)% (11.13)% 0.12%
Ratio of net expenses to average net assets+ 1.06% 1.09% 1.11% 1.14% 1.11%
Ratio of net investment gain to average net assets+ 0.90% 0.86% 0.75% 0.43% 0.31%
Portfolio turnover rate 14% 6% 7% 6% 20%
Net assets, end of period (in thousands) $5,626,270 $5,370,888 $4,584,649 $6,140,520 $6,645,954
Ratios with reductions for fees paid indirectly:
Net expenses 1.06% 1.09% 1.10% 1.13% 1.09%
Net investment income 0.90% 0.86% 0.76% 0.44% 0.33%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS B 12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
Net asset value, beginning of period $ 37.18 $ 30.14 $ 38.13 $ 43.61 $ 47.24
-------- ------- -------- -------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.01 $ (0.02) $ (0.09) $ (0.12) $ (0.18)
Net realized and unrealized gain (loss) on investments 3.96 7.08 (7.90) (5.06) (0.21)
-------- ------- -------- -------- -------
Net increase (decrease) from investment operations $ 3.97 $ 7.06 $ (7.99) $ (5.18) $ (0.39)
Distributions to shareowners:
Net investment income - (0.02) - - -
Net realized gain - - - (0.30) (3.24)
-------- ------- -------- -------- -------
Net increase (decrease) in net asset value $ 3.97 $ 7.04 $ (7.99) $ (5.48) $ (3.63)
-------- ------- -------- -------- -------
Net asset value, end of period $ 41.15 $ 37.18 $ 30.14 $ 38.13 $ 43.61
======== ======= ======== ======== =======
Total return* 10.68% 23.44% (20.96)% (11.87)% (0.75)%
Ratio of net expenses to average net assets+ 1.93% 2.00% 1.98% 1.99% 1.98%
Ratio of net investment income (loss) to average net assets+ 0.02% (0.05)% (0.12)% (0.41)% (0.56)%
Portfolio turnover rate 14% 6% 7% 6% 20%
Net assets, end of period (in thousands) $538,786 $555,669 $488,242 $680,820 $705,339
Ratios with reduction for fees paid indirectly:
Net expenses 1.93% 2.00% 1.97% 1.98% 1.96%
Net investment income (loss) 0.02% (0.05)% (0.11)% (0.40)% (0.54)%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales charges.
Total return would be reduced if sales charges were taken into account.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS C 12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
Net asset value, beginning of period $ 36.84 $ 29.84 $ 37.74 $ 43.15 $ 46.76
-------- -------- -------- -------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ 0.04 $ 0.02 $ (0.54) $ (0.06) $ (0.12)
Net realized and unrealized gain (loss) on investments 3.91 7.01 (7.34) (5.05) (0.25)
-------- -------- -------- -------- -------
Net increase (decrease) from investment operations $ 3.95 $ 7.03 $ (7.88) $ (5.11) $ (0.37)
Distributions to shareowners:
Net investment income (0.06) (0.03) (0.02) - -
Net realized gain - - - (0.30) (3.24)
-------- -------- -------- -------- -------
Net increase (decrease) in net asset value $ 3.89 $ 7.00 $ (7.90) $ (5.41) $ (3.61)
-------- -------- -------- -------- -------
Net asset value, end of period $ 40.73 $ 36.84 $ 29.84 $ 37.74 $ 43.15
======== ======== ======== ======== =======
Total return* 10.74% 23.58% (20.87)% (11.84)% (0.72)%
Ratio of net expenses to average net assets+ 1.84% 1.89% 1.90% 1.94% 1.95%
Ratio of net investment gain (loss) to average net assets+ 0.11% 0.05% (0.03)% (0.37)% (0.54)%
Portfolio turnover rate 14% 6% 7% 6% 20%
Net assets, end of period (in thousands) $313,420 $292,526 $226,183 $282,616 $240,792
Ratios with reduction for fees paid indirectly:
Net expenses 1.84% 1.89% 1.89% 1.93% 1.92%
Net investment income (loss) 0.11% 0.05% (0.02%) (0.36%) (0.51%)
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales charges.
Total return would be reduced if sales charges were taken into account.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
CLASS Y 12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
Net asset value, beginning of period $ 38.09 $ 30.82 $ 38.93 $ 44.34 $ 47.62
-------- -------- -------- -------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.52 $ 0.41 $ 0.41 $ 0.24 $ 0.35
Net realized and unrealized gain (loss) on investments 4.06 7.28 (8.13) (5.02) (0.14)
-------- -------- -------- -------- -------
Net increase (decrease) from investment operations $ 4.58 $ 7.69 $ (7.72) $ (4.78) $ 0.21
Distributions to shareowners:
Net investment income (0.51) (0.42) (0.39) (0.33) (0.25)
Net realized gain - - - (0.30) (3.24)
-------- -------- -------- -------- -------
Net increase (decrease) in net asset value $ 4.07 $ 7.27 $ (8.11) $ (5.41) $ (3.28)
-------- -------- -------- -------- -------
Net asset value, end of period $ 42.16 $ 38.09 $ 30.82 $ 38.93 $ 44.34
======== ======== ======== ======== =======
Total return* 12.15% 25.14% (19.92)% (10.75)% 0.50%
Ratio of net expenses to average net assets+ 0.61% 0.61% 0.70% 0.72% 0.72%
Ratio of net investment income to average net assets+ 1.34% 1.31% 1.17% 0.84% 0.70%
Portfolio turnover rate 14% 6% 7% 6% 20%
Net assets, end of period (in thousands) $155,647 $139,210 $ 80,262 $101,603 $12,566
Ratios with reduction for fees paid indirectly:
Net expenses 0.61% 0.61% 0.69% 0.70% 0.70%
Net investment income 1.34% 1.31% 1.18% 0.86% 0.72%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, and the complete redemption of the
investment at net asset value at each end of each period.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Six Months
Ended
3/31/05 Year Ended
CLASS A (unaudited) 9/30/04
Net asset value, beginning of period $ 18.83 $ 16.25
--------- ----------
Increase (decrease) from investment operations:
Net investment income $ 0.06 $ 0.14
Net realized and unrealized gain (loss) on invest-
ments and foreign currency transactions 1.50 2.62
--------- ----------
Net increase (decrease) from investment
operations $ 1.56 $ 2.76
Distributions to shareowners:
Net investment income (0.07) (0.14)
Net realized gain (2.60) (0.04)
--------- ----------
Net increase (decrease) in net asset value $ (1.11) $ 2.58
--------- ----------
Net asset value, end of period $ 17.72 $ 18.83
========= ==========
Total return* 8.63% 17.04%
Ratio of net expenses to average net assets+ 0.98%** 1.02%
Ratio of net investment income to average net assets+ 0.80%** 0.72%
Portfolio turnover rate 59%** 40%
Net assets, end of period (in thousands) $3,894,102 $3,745,950
Ratios with reduction for fees paid indirectly:
Net expenses 0.98%** 1.02%
Net investment income 0.80%** 0.72%
Year Ended Year Ended Year Ended Year Ended
CLASS A 9/30/03 9/30/02 9/30/01 9/30/00
Net asset value, beginning of period $ 15.29 $ 19.12 $ 22.67 $ 20.16
---------- --------- --------- ----------
Increase (decrease) from investment operations:
Net investment income $ 0.11 $ 0.15 $ 0.17 $ 0.20
Net realized and unrealized gain (loss) on invest-
ments and foreign currency transactions 3.20 (3.17) (2.05) 3.02
---------- --------- --------- ----------
Net increase (decrease) from investment
operations $ 3.31 $ (3.02) $ (1.88) $ 3.22
Distributions to shareowners:
Net investment income (0.24) (0.09) (0.14) (0.20)
Net realized gain (2.11) (0.72) (1.53) (0.51)
---------- --------- --------- ----------
Net increase (decrease) in net asset value $ 0.96 $ (3.83) $ (3.55) $ 2.51
---------- --------- --------- ----------
Net asset value, end of period $ 16.25 $ 15.29 $ 19.12 $ 22.67
========== ========= ========= ==========
Total return* 22.94% (16.78)% (8.88)% 16.29%
Ratio of net expenses to average net assets+ 1.19% 1.16% 1.01% 0.96%
Ratio of net investment income to average net assets+ 0.85% 0.74% 0.76% 0.81%
Portfolio turnover rate 40% 61% 3% 3%
Net assets, end of period (in thousands) $3,424,962 $3,016,623 $3,885,560 $4,614,739
Ratios with reduction for fees paid indirectly:
Net expenses 1.19% 1.16% 0.99% 0.94%
Net investment income 0.85% 0.74% 0.78% 0.83%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Six Months
Ended
3/31/05 Year Ended
CLASS B (unaudited) 9/30/04
Net asset value, beginning of period $ 17.87 $ 15.45
--------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.02) $ (0.04)
Net realized and unrealized gain (loss) on invest-
ments and foreign currency transactions 1.41 2.50
--------- -------
Net increase (decrease) from investment
operations $ 1.39 $ 2.46
Distributions to shareowners:
Net investment income - -
Net realized gain (2.60) (0.04)
--------- -------
Net increase (decrease) in net asset value $ (1.21) $ 2.42
--------- -------
Net asset value, end of period $ 16.66 $ 17.87
========= =======
Total return* 8.10% 15.95%
Ratio of net expenses to average net assets+ 2.02%** 1.89%
Ratio of net investment loss to average net assets+ (0.24)%** (0.15)%
Portfolio turnover rate 59%** 40%
Net assets, end of period (in thousands) $ 31,842 $32,440
Ratios with reduction for fees paid indirectly:
Net expenses 2.01%** 1.89%
Net investment loss (0.23)%** (0.15)%
Year Ended Year Ended Year Ended Year Ended
CLASS B 9/30/03 9/30/02 9/30/01 9/30/00
Net asset value, beginning of period $ 14.71 $ 18.53 $ 22.11 $ 19.74
------- --------- ------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.13) $ (0.08) $ 0.01 $ (0.14)
Net realized and unrealized gain (loss) on invest-
ments and foreign currency transactions 3.08 (3.02) (2.06) 3.02
------- --------- ------- -------
Net increase (decrease) from investment
operations $ 2.95 $ (3.10) $ (2.05) $ 2.88
Distributions to shareowners:
Net investment income (0.10) - - -
Net realized gain (2.11) (0.72) (1.53) (0.51)
------- --------- ------- -------
Net increase (decrease) in net asset value $ 0.74 $ (3.82) $ (3.58) $ 2.37
------- --------- ------- -------
Net asset value, end of period $ 15.45 $ 14.71 $ 18.53 $ 22.11
======= ========= ======= =======
Total return* 21.11% (17.68)% (9.84)% 14.81%
Ratio of net expenses to average net assets+ 2.69% 2.28% 2.07% 2.23%
Ratio of net investment loss to average net assets+ (0.66)% (0.38)% (0.30)% (0.48)%
Portfolio turnover rate 40% 61% 3% 3%
Net assets, end of period (in thousands) $21,666 $ 17,976 $22,372 $20,632
Ratios with reduction for fees paid indirectly:
Net expenses 2.68% 2.29% 2.05% 2.21%
Net investment loss (0.65)% (0.39)% (0.28)% (0.46)%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratios with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Six Months
Ended
3/31/05 Year Ended
CLASS C (unaudited) 9/30/04
Net asset value, beginning of period $ 17.87 $ 15.49
--------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.03) $ (0.09)
Net realized and unrealized gain (loss) on invest-
ments and foreign currency transactions 1.41 2.51
--------- -------
Net increase (decrease) from investment
operations $ 1.38 $ 2.42
Distributions to shareowners:
Net investment income - -
Net realized gain (2.60) (0.04)
--------- -------
Net increase (decrease) in net asset value $ (1.22) $ 2.38
--------- -------
Net asset value, end of period $ 16.65 $ 17.87
========= ========
Total return* 8.05% 15.66%
Ratio of net expenses to average net assets+ 2.09%** 2.21%
Ratio of net investment loss to average net assets+ (0.31)%** (0.47)%
Portfolio turnover rate 59%** 40%
Net assets, end of period (in thousands) $ 9,433 $ 9,168
Ratios with reduction for fees paid indirectly:
Net expenses 2.09%** 2.20%
Net investment loss (0.31)%** (0.46)%
Year Ended Year Ended Year Ended Year Ended
CLASS C 9/30/03 9/30/02 9/31/01 9/30/00
Net asset value, beginning of period $ 14.69 $ 18.53 $ 22.16 $ 19.78
------- --------- ------- -------
Increase (decrease) from investment operations:
Net investment income (loss) $ (0.12) $ (0.10) $ 0.04 $ (0.15)
Net realized and unrealized gain (loss) on invest-
ments and foreign currency transactions 3.13 (3.02) (2.12) 3.04
------- --------- ------- -------
Net increase (decrease) from investment
operations $ 3.01 $ (3.12) $ (2.08) $ 2.89
Distributions to shareowners:
Net investment income (0.10) - (0.02) -
Net realized gain (2.11) (0.72) (1.53) (0.51)
------- --------- ------- -------
Net increase (decrease) in net asset value $ 0.80 $ (3.84) $ (3.63) $ 2.38
------- --------- ------- -------
Net asset value, end of period $ 15.49 $ 14.69 $ 18.53 $ 22.16
======= ========= ======= =======
Total return* 21.61% (17.79)% (9.98)% 14.83%
Ratio of net expenses to average net assets+ 2.48% 2.32% 2.15% 2.19%
Ratio of net investment loss to average net assets+ (0.44)% (0.42)% (0.39)% (0.43)%
Portfolio turnover rate 40% 61% 3% 3%
Net assets, end of period (in thousands) $ 6,349 $ 4,256 $ 4,431 $ 3,588
Ratios with reduction for fees paid indirectly:
Net expenses 2.47% 2.32% 2.11% 2.16%
Net investment loss (0.43)% (0.42)% (0.35)% (0.40)%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Pioneer Value Fund
Six Months
Ended 8/11/04(a)
3/31/05 to
(unaudited) 9/30/04
CLASS Y
Net asset value, beginning of period $ 18.84 $ 18.16
------- -------
Increase from investment operations:
Net investment income $ 0.06 $ 0.02
Net realized and unrealized gain on investments and
foreign currency transactions 1.55 0.66
------- -------
Net increase from investment operations $ 1.61 $ 0.68
------- -------
Distributions to shareowners:
Net investment income (0.10) -
Net realized gain (2.60) -
------- -------
Net increase (decrease) in net asset value $ (1.09) $ 0.68
------- -------
Net asset value, end of period $ 17.75 $ 18.84
======= =======
Total return* 8.96% 3.74%
Ratio of net expenses to average net assets+ 0.59%** 0.61%**
Ratio of net investment income to average net assets+ 1.26%** 1.37%**
Portfolio turnover rate 59%** 40%
Net assets, end of period (in thousands) $10,187 $ 1,872
Ratios with reduction for fees paid indirectly:
Net expenses 0.59%** 0.61%**
Net investment income 1.26%** 1.37%**
|
(a) Class Y shares were first publicly offered on August 11, 2004.
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of distributions, the complete redemption of the
investment at net asset value at the end of each period.
** Annualized.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements. 33
Pioneer Short Term Income Fund
Six Months
Ended
2/28/05 7/8/04 to
(unaudited) 8/31/04 (a)
CLASS A
Net asset value, beginning of period $ 10.02 $10.00
------- ------
Increase from investment operations:
Net investment income $ 0.10 $ 0.03
Net realized and unrealized gain (loss)
on investments (0.09) 0.03
------- ------
Net increase from investment operations $ 0.01 $ 0.06
Distributions to shareowners:
Net investment income (0.15) (0.04)
------- ------
Net increase (decrease) in net asset value $ (0.14) $ 0.02
------- ------
Net asset value, end of period $ 9.88 $10.02
======= ======
Total return* 0.12%(b) 0.59%(b)
Ratio of net expenses to average net assets 0.90%** 0.90%**
Ratio of net investment income to average
net assets 1.74%** 1.64%**
Portfolio turnover rate 148%** 24%(b)
Net assets, end of period (in thousands) $10,546 $1,478
Ratios with no waiver of management fees and
assumption of expenses by PIM:
Net expenses 1.63%** 9.40%**
Net investment income (loss) 1.01%** (6.86)%**
|
(a) Class A shares were first publicly offered on July 8, 2004
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
(b) Not annualized
24 The accompanying notes are an integral part of these financial statements.
Pioneer Short Term Income Fund
Six Months
Ended
2/28/05 7/8/04 to
(unaudited) 8/31/04 (a)
CLASS B
Net asset value, beginning of period $10.01 $10.00
------ ------
Increase from investment operations:
Net investment income $ 0.07 $ 0.01
Net realized and unrealized gain (loss)
on investments (0.09) 0.03
------ ------
Net increase from investment operations $(0.02) $ 0.04
Distributions to shareowners:
Net investment income (0.11) (0.03)
------ ------
Net increase (decrease) in net asset value $(0.13) $ 0.01
------ ------
Net asset value, end of period $ 9.88 $10.01
====== ======
Total return* (0.20)%(b) 0.40%(b)
Ratio of net expenses to average net assets 1.79%** 1.89%**
Ratio of net investment income to average
net assets 1.10%** 0.65%**
Portfolio turnover rate 148%** 24%(b)
Net assets, end of period (in thousands) $1,211 $ 718
Ratios with no waiver of management fees and
assumption of expenses by PIM:
Net expenses 3.02%** 10.65%**
Net investment income (loss) (0.13)%** (8.11)%**
|
(a) Class B shares were first publicly offered on July 8, 2004
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
(b) Not annualized
The accompanying notes are an integral part of these financial statements. 25
Pioneer Short Term Income Fund
Six Months
Ended
2/28/05 7/8/04 to
(unaudited) 8/31/04 (a)
CLASS C
Net asset value, beginning of period $10.00 $10.00
------ ------
Increase from investment operations:
Net investment income $ 0.04 $ 0.03
Net realized and unrealized gain (loss)
on investments (0.05) 0.02
------ ------
Net increase from investment operations $(0.01) $ 0.05
Distributions to shareowners:
Net investment income (0.12) (0.05)
------ ------
Net decrease in net asset value $(0.13) $ -
------ ------
Net asset value, end of period $ 9.87 $10.00
====== ======
Total return* (0.11)%(b) 0.46%(b)
Ratio of net expenses to average net assets 1.69%** 1.39%**
Ratio of net investment income to average
net assets 0.64%** 1.16%**
Portfolio turnover rate 148%** 24%(b)
Net assets, end of period (in thousands) $3,997 $2,538
Ratios with no waiver of management fees and
assumption of expenses by PIM:
Net expenses 2.86%** 9.63%**
Net investment income (loss) (0.53)%** (7.08)%**
|
(a) Class C shares were first publicly offered on July 8, 2004
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
** Annualized
(b) Not annualized
26 The accompanying notes are an integral part of these financial statements.
Pioneer Short Term Income Fund
Six Months
Ended
2/28/05 7/8/04 to
(unaudited) 8/31/04 (a)
CLASS Y
Net asset value, beginning of period $10.01 $10.00
------ ------
Increase from investment operations:
Net investment income $ 0.16 $ 0.04
Net realized and unrealized gain (loss)
on investments (0.11) 0.02
------ ------
Net increase from investment operations $ 0.05 $ 0.06
Distributions to shareowners:
Net investment income (0.17) (0.05)
------ ------
Net increase (decrease) in net asset value $(0.12) $ 0.01
------ ------
Net asset value, end of period $ 9.89 $10.01
====== ======
Total return* 0.50%(b) 0.57%(b)
Ratio of net expenses to average net assets 0.58%** 0.61%**
Ratio of net investment income to average
net assets 4.18%** 1.94%**
Portfolio turnover rate 148%** 24%(b)
Net assets, end of period (in thousands) $7,378 $ 530
Ratios with no waiver of management fees and
assumption of expenses by PIM:
Net expenses 1.24%** 10.54%**
Net investment income (loss) 3.52%** (7.99)%**
|
(a) Class Y shares were first publicly offered on July 8, 2004
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period.
** Annualized
(b) Not annualized
The accompanying notes are an integral part of these financial statements. 27
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
CLASS A
Net asset value, beginning of period $ 11.70 $ 11.61 $ 11.47 $ 11.70 $ 10.98
-------- -------- -------- -------- --------
Increase (decrease) from investment operations:
Net investment income $ 0.56 $ 0.56 $ 0.56 $ 0.53 $ 0.52
Net realized and unrealized gain (loss) on investments (0.02) 0.09 0.23 (0.05) 0.72
-------- -------- -------- -------- --------
Net increase from investment operations $ 0.54 $ 0.65 $ 0.79 $ 0.48 $ 1.24
Distributions to shareowners:
Net investment income (0.57) (0.56) (0.57) (0.53) (0.52)
In excess of net investment income - - - - (0.00)(a)
Net realized gain - - (0.08) (0.18) -
-------- -------- -------- -------- --------
Net increase (decrease) in net asset value $ (0.03) $ 0.09 $ 0.14 $ (0.23) $ 0.72
-------- -------- -------- -------- --------
Net asset value, end of period $ 11.67 $ 11.70 $ 11.61 $ 11.47 $ 11.70
======== ======== ======== ======== ========
Total return* 4.75% 5.80% 7.07% 4.13% 11.63%
Ratio of net expenses to average net assets+ 0.91% 0.93% 0.93% 0.92% 0.95%
Ratio of net investment income to average net assets+ 4.88% 4.88% 4.83% 4.49% 4.62%
Portfolio turnover rate 39% 80% 161% 92% 14%
Net assets, end of period (in thousands) $307,463 $326,173 $343,872 $333,867 $341,179
Ratios with reductions for fees paid indirectly:
Net expenses 0.91% 0.93% 0.92% 0.91% 0.91%
Net investment income 4.88% 4.88% 4.84% 4.50% 4.66%
|
(a) Amount rounds to less than one cent per share
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
CLASS B
Net asset value, beginning of period $ 11.59 $ 11.51 $ 11.39 $ 11.62 $ 10.90
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.48 $ 0.46 $ 0.46 $ 0.44 $ 0.43
Net realized and unrealized gain (loss) on investments (0.02) 0.09 0.22 (0.05) 0.72
------- ------- ------- ------- -------
Net increase from investment operations $ 0.46 $ 0.55 $ 0.68 $ 0.39 $ 1.15
Distributions to shareowners:
Net investment income (0.48) (0.47) (0.48) (0.44) (0.43)
Net realized gain - - (0.08) (0.18) -
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ (0.02) $ 0.08 $ 0.12 $ (0.23) $ 0.72
------- ------- ------- ------- -------
Net asset value, end of period $ 11.57 $ 11.59 $ 11.51 $ 11.39 $ 11.62
======= ======= ======= ======= =======
Total return* 4.07% 4.98% 6.17% 3.38% 10.78%
Ratio of net expenses to average net assets+ 1.67% 1.70% 1.69% 1.67% 1.71%
Ratio of net investment income to average net assets+ 4.12% 4.10% 4.05% 3.73% 3.87%
Portfolio turnover rate 39% 80% 161% 92% 14%
Net assets, end of period (in thousands) $17,285 $20,363 $18,960 $13,735 $11,145
Ratios with reduction for fees paid indirectly:
Net expenses 1.67% 1.70% 1.69% 1.66% 1.70%
Net investment income 4.12% 4.10% 4.05% 3.74% 3.88%
|
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01 12/31/00
CLASS C
Net asset value, beginning of period $ 11.52 $ 11.44 $ 11.31 $ 11.54 $ 10.91
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.47 $ 0.48 $ 0.49 $ 0.49 $ 0.43
Net realized and unrealized gain (loss) on investments (0.02) 0.08 0.21 (0.05) 0.70
------- ------- ------- ------- -------
Net increase from investment operations $ 0.45 $ 0.56 $ 0.70 $ 0.44 $ 1.13
Distributions to shareowners:
Net investment income (0.48) (0.48) (0.49) (0.49) (0.43)
In excess of net investment income - - - - (0.07)
Net realized gain - - (0.08) (0.18) -
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ (0.03) $ 0.08 $ 0.13 $ (0.23) $ 0.63
------- ------- ------- ------- -------
Net asset value, end of period $ 11.49 $ 11.52 $ 11.44 $ 11.31 $ 11.54
======= ======= ======= ======= =======
Total return* 4.02% 5.04% 6.33% 3.39% 10.59%
Ratio of net expenses to average net assets+ 1.64% 1.66% 1.70% 1.62% 1.80%
Ratio of net investment income to average net assets+ 4.15% 4.11% 4.03% 3.75% 3.80%
Portfolio turnover rate 39% 80% 161% 92% 14%
Net assets, end of period (in thousands) $12,577 $11,266 $ 8,673 $ 3,505 $ 1,490
Ratios with reduction for fees paid indirectly:
Net expenses 1.64% 1.66% 1.70% 1.61% 1.77%
Net investment income 4.15% 4.11% 4.03% 3.76% 3.83%
|
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges. Total return would be reduced if sales charges were taken into account.
+ Ratio with no reduction for fees paid indirectly.
The accompanying notes are an integral part of these financial statements.
Year Year 2/28/02(a)
Ended Ended to
12/31/04 12/31/03 12/31/02
CLASS Y
Net asset value, beginning of period $ 11.64 $ 11.56 $ 11.65
------- ------- -------
Increase from investment operations:
Net investment income $ 0.57 $ 0.62 $ 0.19
Net realized and unrealized gain on investments 0.01 0.07 0.02
------- ------- -------
Net increase from investment operations $ 0.58 $ 0.69 $ 0.21
Distributions to shareowners:
Net investment income (0.61) (0.61) (0.22)
Net realized gain - - (0.08)
------- ------- -------
Net increase (decrease) in net asset value $ (0.03) $ 0.08 $ (0.09)
------- ------- -------
Net asset value, end of period $ 11.61 $ 11.64 $ 11.56
======= ======= =======
Total return* 5.14% 6.21% 1.40%
Ratio of net expenses to average net assets+ 0.55% 0.57% 0.87%**
Ratio of net investment income to average
net assets+ 5.26% 5.21% 4.95%**
Portfolio turnover rate 39% 80% 161%
Net assets, end of period (in thousands) $ 393 $ 1,387 $ 392
Ratios with reduction for fees paid indirectly:
Net expenses 0.55% 0.57% 0.87%**
Net investment income 5.26% 5.21% 4.95%**
|
(a) Class Y shares were first publicly offered on February 28, 2002. The per share amounts and ratios shown are based on the period from August 29, 2002 to December 31, 2002, during which the class had operations.
* Assumes initial investment at net asset value at the beginning of each period, reinvestment of all distributions, the complete redemption of the investment at net asset value at the end of each period, and no sales charges.
** Annualized
+ Ratios with no reduction for fees paid indirectly
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01(a) 12/31/00
CLASS A
Net asset value, beginning of period $ 9.95 $ 10.27 $ 9.79 $ 9.76 $ 9.30
-------- -------- -------- -------- -------
Increase from investment operations:
Net investment income $ 0.28 $ 0.28 $ 0.40 $ 0.52 $ 0.58
Net realized and unrealized gain (loss) on investments (0.01) (0.13) 0.54 0.05 0.46
-------- -------- -------- -------- -------
Net increase from investment operations $ 0.27 $ 0.15 $ 0.94 $ 0.57 $ 1.04
Distributions to shareowners:
Net investment income (0.43) (0.47) (0.46) (0.51) (0.58)
Net realized gain - - - (0.03) -
-------- -------- -------- -------- -------
Net increase (decrease) in net asset value $ (0.16) $ (0.32) $ 0.48 $ 0.03 $ 0.46
-------- -------- -------- -------- -------
Net asset value, end of period $ 9.79 $ 9.95 $ 10.27 $ 9.79 $ 9.76
======== ======== ======== ======== =======
Total return* 2.77% 1.47% 9.78% 5.92% 11.58%
Ratio of net expenses to average net assets+ 1.16% 1.10% 1.00% 1.01% 1.04%
Ratio of net investment income to average net assets+ 3.04% 2.85% 4.17% 5.14% 6.09%
Portfolio turnover rate 27% 66% 76% 72% 56%
Net assets, end of period (in thousands) $123,524 $153,939 $164,393 $115,998 $96,068
Ratios with no waiver of management fees by
PIM and no reductions for fees paid indirectly:
Net expenses 1.16% 1.12% 1.08% 1.12% 1.16%
Net investment income 3.04% 2.83% 4.09% 5.03% 5.97%
Ratios with waiver of management fees by
PIM and reductions for fees paid indirectly:
Net expenses 1.16% 1.10% 1.00% 1.00% 1.00%
Net investment income 3.04% 2.85% 4.18% 5.15% 6.13%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio with no reduction for fees paid indirectly.
(a) On January 1, 2001, the Trust began accreting discounts and amortizing
premiums on debt securities. The effect of this charges for the year ended
December 31, 2001, was to decrease net investment income by $0.02 per share,
increase net realized and unrealized gain (loss) by $0.02 per share and
decrease the ratio of net investment income to average net assets assuming
waiver of management fees by PIM and reduction for fees paid indirectly from
5.35% to 5.15%. Per share ratios and supplemental data for periods prior to
January 1, 2001, have not been restated to reflect this change in
presentation.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01(a) 12/31/00
CLASS B
Net asset value, beginning of period $ 9.89 $ 10.20 $ 9.76 $ 9.74 $ 9.28
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.18 $ 0.19 $ 0.34 $ 0.44 $ 0.50
Net realized and unrealized gain (loss) on investments 0.02 (0.12) 0.50 0.04 0.46
------- ------- ------- ------- -------
Net increase from investment operations $ 0.20 $ 0.07 $ 0.84 $ 0.48 $ 0.96
Distributions to shareowners:
Net investment income (0.35) (0.38) (0.40) (0.42) (0.50)
Net realized gain - - - (0.04) -
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ (0.15) $ (0.31) $ 0.44 $ 0.02 $ 0.46
------- ------- ------- ------- -------
Net asset value, end of period $ 9.74 $ 9.89 $ 10.20 $ 9.76 $ 9.74
======= ======= ======= ======= =======
Total return* 2.02% 0.69% 8.82% 4.99% 10.68%
Ratio of net expenses to average net assets+ 1.98% 1.94% 1.80% 1.95% 1.85%
Ratio of net investment income to average net assets+ 2.22% 2.02% 3.26% 4.18% 5.29%
Portfolio turnover rate 27% 66% 76% 72% 56%
Net assets, end of period (in thousands) $39,641 $55,302 $67,013 $25,008 $16,889
Ratios with no waiver of management fees by
PIM and no reduction for fees paid indirectly:
Net expenses 1.98% 1.96% 1.88% 2.06% 1.98%
Net investment income 2.22% 2.00% 3.19% 4.07% 5.16%
Ratios with waiver of management fees by
PIM and reductions for fees paid indirectly:
Net expenses 1.98% 1.94% 1.79% 1.93% 1.83%
Net investment income 2.22% 2.02% 3.27% 4.20% 5.31%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio with no reduction for fees paid indirectly.
(a) On January 1, 2001, the Trust began accreting discounts and amortizing
premiums on debt securities. The effect of this charges for the year ended
December 31, 2001, was to decrease net investment income by $0.02 per share,
increase net realized and unrealized gain (loss) by $0.02 per share and
decrease the ratio of net investment income to average net assets assuming
waiver of management fees by PIM and reduction for fees paid indirectly from
4.36% to 4.20%. Per share ratios and supplemental data for periods prior to
January 1, 2001, have not been restated to reflect this change in
presentation.
The accompanying notes are an integral part of these financial statements.
Year Ended Year Ended Year Ended Year Ended Year Ended
12/31/04 12/31/03 12/31/02 12/31/01(a) 12/31/00
CLASS C
Net asset value, beginning of period $ 9.92 $ 10.24 $ 9.79 $ 9.74 $ 9.28
------- ------- ------- ------- -------
Increase (decrease) from investment operations:
Net investment income $ 0.19 $ 0.21 $ 0.36 $ 0.46 $ 0.49
Net realized and unrealized gain (loss) on investments 0.01 (0.13) 0.50 0.03 0.46
------- ------- ------- ------- -------
Net increase from investment operations $ 0.20 $ 0.08 $ 0.86 $ 0.49 $ 0.95
Distributions to shareowners:
Net investment income (0.35) (0.40) (0.41) (0.43) (0.49)
Net realized gain - - - (0.01) -
------- ------- ------- ------- -------
Net increase (decrease) in net asset value $ (0.15) $ (0.32) $ 0.45 $ 0.05 $ 0.46
------- ------- ------- ------- -------
Net asset value, end of period $ 9.77 $ 9.92 $ 10.24 $ 9.79 $ 9.74
======= ======= ======= ======= =======
Total return* 2.09% 0.75% 8.93% 5.05% 10.52%
Ratio of net expenses to average net assets+ 1.89% 1.81% 1.77% 1.84% 2.02%
Ratio of net investment income to average net assets+ 2.31% 2.14% 3.16% 4.22% 5.14%
Portfolio turnover rate 27% 66% 76% 72% 56%
Net assets, end of period (in thousands) $27,832 $37,456 $38,258 $ 6,776 $ 3,221
Ratios with no waiver of management fees by
PIM and no reduction for fees paid indirectly:
Net expenses 1.89% 1.83% 1.84% 1.95% 2.15%
Net investment income 2.31% 2.12% 3.08% 4.11% 5.01%
Ratios with waiver of management fees by
PIM and reductions for fees paid indirectly:
Net expenses 1.89% 1.81% 1.76% 1.81% 1.97%
Net investment income 2.31% 2.14% 3.16% 4.25% 5.19%
|
* Assumes initial investment at net asset value at the beginning of each
period, reinvestment of all distributions, the complete redemption of the
investment at net asset value at the end of each period, and no sales
charges. Total return would be reduced if sales charges were taken into
account.
+ Ratio with no reduction for fees paid indirectly.
(a) On January 1, 2001, the Trust began accreting discounts and amortizing
premiums on debt securities. The effect of this changes for the year ended
December 31, 2001, was to decrease net investment income by $0.01 per share,
increase net realized and unrealized gain (loss) by $0.01 per share and
decrease the ratio of net investment income to average net assets assuming
waiver of management fees by PIM and reduction for fees paid indirectly from
4.42% to 4.25%. Per share ratios and supplemental data for periods prior to
January 1, 2001, have not been restated to reflect this change in
presentation.
The accompanying notes are an integral part of these financial statements.
INFORMATION CONCERNING THE MEETING
Solicitation of Proxies
In addition to the mailing of these proxy materials, proxies may be solicited by telephone, by fax or in person by the trustees and officers of your AmSouth Fund or its affiliates, including personnel of your AmSouth Fund's transfer agent, Pioneer Funds' investment adviser, Pioneer, Pioneer Funds' transfer agent, PIMSS, or by broker-dealer firms. [ ], has been retained to provide proxy solicitation services to the Funds at a cost of approximately $[ ]. Pioneer and AmSouth Bancorporation will bear the cost of such solicitation.
Revoking Proxies
An AmSouth Fund shareholder signing and returning a proxy has the power to revoke it at any time before it is exercised:
o by filing a written notice of revocation with your AmSouth Fund's transfer agent, BISYS Fund Services, at P.O. Box 182733, Columbus, Ohio 43218-2733, or
o by returning a duly executed proxy with a later date before the time of the Meeting, or
o if a shareholder has executed a proxy but is present at the Meeting and wishes to vote in person, by notifying the secretary of your AmSouth Fund (without complying with any formalities) at any time before it is voted.
Being present at the Meeting alone does NOT revoke a previously executed and returned proxy.
Outstanding Shares
Only shareholders of record on [ ], 2005 (the "record date") are entitled to notice of and to vote at the Meeting. As of the record date, the following number of shares of each AmSouth Fund were outstanding.
Shares Outstanding
AmSouth Fund (as of [ ], 2005)
------------ -----------------
AmSouth Capital Growth Fund .......................
AmSouth Large Cap Fund.............................
AmSouth Enhanced Market Fund.......................
AmSouth Value Fund.................................
AmSouth Mid Cap Fund ..............................
AmSouth Small Cap Fund ............................
AmSouth International Equity Fund .................
AmSouth Select Equity Fund ........................
AmSouth Balanced Fund
|
AmSouth Strategic Portfolios: Aggressive Growth Portfolio AmSouth Strategic Portfolios: Growth Portfolio AmSouth Strategic Portfolios: Growth and Income Portfolio AmSouth Strategic Portfolios: Moderate Growth and Income Portfolio AmSouth High Quality Bond Fund AmSouth Florida Tax-Exempt Fund AmSouth High Quality Municipal Bond Fund AmSouth Tennessee Tax-Exempt Fund AmSouth Government Income Fund AmSouth Limited Term Bond Fund AmSouth Treasury Reserve Money Market Fund AmSouth Prime Money Market Fund AmSouth Tax-Exempt Money Market Fund AmSouth Institutional Prime Obligations Money Market Fund |
Other Business
Your AmSouth Fund's Board of Trustees knows of no business to be presented for consideration at the Meeting other than Proposals 1(a)-(w). If other business is properly brought before the Meeting, proxies will be voted according to the best judgment of the persons named as proxies.
Adjournments
If, by the time scheduled for the Meeting, a quorum of shareholders of a Fund is not present or if a quorum is present but sufficient votes "for" the proposals have not been received, the persons named as proxies may propose the Meeting with respect to one or more of the Funds to another date and time, and the Meeting may be held as adjourned within a reasonable time after the date set for the original Meeting for that Fund without further notice. Any such adjournment will require the affirmative vote of a majority of the votes cast on the question in person or by proxy at the session of the Meeting to be adjourned. The persons named as proxies will vote all proxies in favor of the adjournment that voted in favor of the proposal or that abstained. They will vote against such adjournment those proxies required to be voted against the proposal. Broker non-votes will be disregarded in the vote for adjournment. If the adjournment requires setting a new record date or the adjournment is for more than 120 days of the original Meeting (in which case the Board of Trustees of your AmSouth Fund will set a new record date), your AmSouth Fund will give notice of the adjourned meeting to its shareholders.
Telephone Voting
In addition to soliciting proxies by mail, by fax or in person, your AmSouth Fund may also arrange to have votes recorded by telephone by officers and employees of your AmSouth Fund or by personnel of the adviser or transfer agent or a third party solicitation firm. The telephone voting procedure is designed to verify a shareholder's identity, to allow a shareholder to authorize the voting of shares in accordance with the shareholder's instructions and to confirm that the voting instructions have been properly recorded. If these procedures were subject to a successful legal challenge, these telephone
votes would not be counted at the Meeting. Your AmSouth Fund has not obtained an opinion of counsel about telephone voting, but is currently not aware of any challenge.
o A shareholder will be called on a recorded line at the telephone number in the Fund's account records and will be asked to provide the shareholder's social security number or other identifying information.
o The shareholder will then be given an opportunity to authorize proxies to vote his or her shares at the Meeting in accordance with the shareholder's instructions.
o To ensure that the shareholder's instructions have been recorded correctly, the shareholder will also receive a confirmation of the voting instructions by mail.
o A toll-free number will be available in case the voting information contained in the confirmation is incorrect.
o If the shareholder decides after voting by telephone to attend the Meeting, the shareholder can revoke the proxy at that time and vote the shares at the Meeting.
o [Insert touchtone telephone voting information]
Internet Voting
You will also have the opportunity to submit your voting instructions via the Internet by utilizing a program provided through the tabulator. Voting via the Internet will not affect your right to vote in person if you decide to attend the Meeting. Do not mail the proxy card if you are voting via the Internet. To vote via the Internet, you will need the "control number" that appears on your proxy card. These Internet voting procedures are designed to authenticate shareholder identities, to allow shareholders give their voting instructions, and to confirm that shareholders instructions have been recorded properly. If you are voting via the Internet you should understand that there may be costs associated with electronic access, such as usage charges from Internet access providers and telephone companies, that must be borne by you.
o Read the proxy statement and have your proxy card at hand.
o Go to the Web site listed on your proxy card.
o Enter control number found on your proxy card.
o Follow the simple instructions on the Web site. Please call AmSouth Funds at 1-800-624-5711 if you have any problems.
o To insure that your instructions have been recorded correctly you will receive a confirmation of your voting instructions immediately after your submission and also by e-mail if chosen.
o [Insert touchtone telephone voting information]
Shareholders' Proposals
Your AmSouth Fund is not required, and does not intend, to hold meetings of shareholders each year. Instead, meetings will be held only when and if required. Any shareholders desiring to present a proposal for consideration at the next meeting for shareholders must submit the proposal in writing, so that it is received by the your AmSouth Fund to [ ] within a reasonable time before any meeting. If the Reorganization is completed, your AmSouth Fund will not hold another shareholder meeting.
Appraisal Rights
If the Reorganization of your AmSouth Fund is approved at the Meeting, shareholders of your AmSouth Fund will not have the right to dissent and obtain payment of the fair value of their shares because the exercise of appraisal rights is subject to the forward pricing requirements of Rule 22c-1 under the Investment Company Act, which supersede state law. Shareholders of your AmSouth Funds, however, have the right to redeem their Fund shares until the closing date of the Reorganizations.
OWNERSHIP OF SHARES OF THE AMSOUTH FUNDS
To the knowledge of your AmSouth Fund, as of May 31, 2005, the following persons owned of record or beneficially 5% or more of the outstanding shares of each of the AmSouth Funds.
Percent of the
Class Held by
Fund/Class No. of Shares Shareholder
AMSOUTH BALANCED FUND - CLASS A
AMVESCAP NATL TR CO AS AGENT FOR AM
BANK FBO AMSOUTH THRIFT PLAN
PO BOX 105779
ATLANTA GA 30348 1715208.626 20.75%
AMVESCAP NATIONAL TRUST CO AS AGENT
FOR AMSOUTH BANK FBO BCBS ALABAMA
PO BOX 105779
ATLANTA GA 30348 1471810.189 17.80%
AMVESCAP NATL TR CO AS AGENT FOR AM
BANK FBO BRASFIELD GORRIE EMPLOYEE
PO BOX 105779
ATLANTA GA 30348 516827.177 6.25%
AMSOUTH BALANCED FUND -- CLASS I
KENNEBURT & COMPANY FBO ASO TRUST
ATTN MUTUAL FUND OPERATIONS
PO BOX 12365
BIRMINGHAM AL 35202 1699127.878 42.24%
AMVESCAP NATIONAL TRUST COMPANY
AS AGENT FOR AMSOUTH BANK
PO BOX 105779
ATLANTA GA 303485779 410690.141 10.21%
BISYS RETIREMENT SERVICES FBO
WARRIOR TRACTOR EQUIPMENT 401K
SUITE 300
DENVER CO 80202 398294.497 9.90%
|
KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 388726.276 9.66% AMVESCAP NATL TR CO AS AGENT FOR AMSOUTH FBO TRACTOR EQUIPMENT PO BOX 105779 ATLANTA GA 30348 275539.796 6.85% AMSOUTH CAPITAL GROWTH FUND - CLASS A AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO AMSOUTH THRIFT PLAN PO BOX 105779 ATLANTA GA 30348 1070750.463 38.96% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 377488.597 13.73% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 211229.688 7.69% AMSOUTH CAPITAL GROWTH FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 9494447.536 44.36% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 6607120.324 30.87% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 1961155.966 9.16% AMSOUTH ENHANCED MARKET FUND - CLASS A AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO AMSOUTH THRIFT PLAN PO BOX 105779 ATLANTA GA 30348 1210321.897 51.77% AMSOUTH ENHANCED MARKET FUND - CLASS I |
KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 5170497.283 39.49% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 3172919.272 24.23% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 1300636.003 9.93% AMSOUTH GROWTH & INCOME PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 1207905.925 9.22% AMSOUTH AGGRESSIVE GROWTH PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 905753.760 6.92% AMSOUTH GROWTH PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 889061.074 6.79% AMSOUTH FLORIDA TAX-EXEMPT FUND - CLASS A PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 189171.452 47.37% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 23706.469 5.94% AMSOUTH FLORIDA TAX-EXEMPT FUND - CLASS B KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 23882.318 10.20% NATIONAL FINANCIAL SERVICES LLC 777 COMMERCE BLVD CARLSTADT NJ 07072 23607.177 10.08% |
PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 21373.706 9.13% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 12642.701 5.40% AMSOUTH FLORIDA TAX-EXEMPT FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 4109578.869 95.09% AMSOUTH GOVERNMENT INCOME FUND - CLASS A KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 271795.024 13.22% BISYS RETIREMENT SERVICES FBO BUILDER S SUPPLY COMPANY INC PROF SUITE 300 DENVER CO 80202 136915.126 6.66% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 107296.831 5.22% BISYS RETIREMENT SERVICES FBO AEROPRES CORPORATION RETIREMENT SAV SUITE 300 DENVER CO 80202 103899.243 5.05% AMSOUTH GOVERNMENT INCOME FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 7095421.548 50.39% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 3641649.788 25.86% |
AMSOUTH GROWTH & INCOME PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 977512.782 6.94% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 875083.106 6.21% AMSOUTH STRATEGIC PORTFOLIOS: GROWTH & INCOME PORTFOLIO - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 2021724.353 52.75% BISYS RETIREMENT SERVICES FBO C C CLARK INC 401K PLAN SUITE 300 DENVER CO 80202 493107.625 12.87% BISYS RETIREMENT SERVICES FBO EAR NOSE THROAT CENTER RET SAVIN SUITE 300 DENVER CO 80202 324655.761 8.47% AMSOUTH STRATEGIC PORTFOLIOS: GROWTH & INCOME PORTFOLIO - CLASS A BISYS RETIREMENT SERVICES FBO THE WOMEN S CLINIC AMC P S PLAN SUITE 300 DENVER CO 80202 551605.180 10.00% BISYS RETIREMENT SERVICES FBO ACE BOLT SCREW CO INC PROFIT SHA SUITE 300 DENVER CO 80202 450593.183 8.17% BISYS RETIREMENT SERVICES FBO HEART CNTR CARDIOVASC SPECIALISTS 4 SUITE 300 DENVER CO 80202 431874.127 7.83% BISYS RETIREMENT SERVICES FBO EAR NOSE THROAT PHYS N MISS 4 SUITE 300 DENVER CO 80202 392323.861 7.11% |
AMSOUTH STRATEGIC PORTFOLIOS: GROWTH PORTFOLIO - CLASS A
AMVESCAP NATIONAL TRUST COMPANY AS AGENT FOR AMSOUTH BANK PO BOX 105779 ATLANTA GA 30348 320083.181 10.22% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 249833.742 7.98% BISYS RETIREMENT SERVICES FBO NORTH MISSISSIPPI ORAL 401 K PS PL SUITE 300 DENVER CO 80202 177625.115 5.67% AMSOUTH STRATEGIC PORTFOLIOS: GROWTH PORTFOLIO - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 338956.524 39.79% AMSOUTH BANK COOK YANCEY KING GALLOWAY PO BOX 12365 BIRMINGHAM AL 35202 180856.121 21.23% BISYS RETIREMENT SERVICES FBO SEABROOK EES PROFIT SHARING RETIREM SUITE 300 DENVER CO 80202 61057.862 7.17% BISYS RETIREMENT SERVICES FBO WALKER-J-WALKER INC PROFIT SHARIN SUITE 300 DENVER CO 80202 54070.165 6.35% AMSOUTH HIGH QUALITY BOND FUND - CLASS A AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO AMSOUTH THRIFT PLAN PO BOX 105779 ATLANTA GA 30348 408992.228 8.57% AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO BRASFIELD GORRIE EMPLOYE PO BOX 105779 ATLANTA GA 30348 352495.555 7.39% |
KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 247519.307 5.19% AMSOUTH HIGH QUALITY BOND FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 26799824.811 53.13% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 10603041.188 21.02% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 7283299.375 14.44% AMSOUTH HIGH QUALITY MUNICIPAL BOND FUND - CLASS A PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 104433.621 6.82% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 87715.686 5.73% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 86290.640 5.64% AMSOUTH HIGH QUALITY MUNICIPAL BOND FUND - CLASS B PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 30788.736 8.37% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 23100.812 6.28% |
PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 21701.795 5.90% AMSOUTH HIGH QUALITY MUNICIPAL BOND FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 22801740.026 75.08% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 5278700.919 17.38% AMSOUTH INSTITUTIONAL PRIME OBLIGATIONS MONEY MARKET FUND - CLASS I KENNEBURT & COMPANY PO BOX 11426 CSTDY UNIT ATTN PROPRIETARY FUNDS-RCS 5 BIRMINGHAM AL 352021426 158300602.970 85.16% AMSOUTH STABLE PRINCIPAL 3435 STELZER RD COLUMBUS OH 43219 27494605.160 14.79% AMSOUTH INSTITUTIONAL PRIME OBLIGATIONS MONEY MARKET FUND - CLASS II AMSOUTH BANK PO BOX 11301 BIRMINGHAM AL 35202 70956579.050 50.70% AMSOUTH BANK PO BOX 11301 BIRMINGHAM AL 35202 67986840.140 48.58% AMSOUTH INSTITUTIONAL PRIME OBLIGATIONS MONEY MARKET FUND - CLASS III AMSOUTH BANK PO BOX 11301 BIRMINGHAM AL 35202 25788178.200 53.36% AMSOUTH BANK PO BOX 11301 BIRMINGHAM AL 35202 22543387.510 46.64% |
AMSOUTH INTERNATIONAL EQUITY FUND CLASS A AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO AMSOUTH THRIFT PLAN PO BOX 105779 ATLANTA GA 30348 797254.163 41.59% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 113859.081 5.94% AMSOUTH INTERNATIONAL EQUITY FUND - CLASS B PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 12844.984 5.44% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 12158.459 5.15% AMSOUTH INTERNATIONAL EQUITY FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 13164141.723 40.32% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 12757231.053 39.07% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 5128059.560 15.71% AMSOUTH LARGE CAP FUND - CLASS A AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO AMSOUTH THRIFT PLAN PO BOX 105779 ATLANTA GA 30348 915132.986 14.78% AMVESCAP NATIONAL TRUST CO AS AGENT FOR AMSOUTH BANK FBO BCBS ALABAMA PO BOX 105779 ATLANTA GA 30348 353866.656 5.71% |
AMSOUTH LARGE CAP FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 4711697.773 44.77% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 2591205.997 24.62% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 877383.765 8.34% AMSOUTH LIMITED TERM BOND FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 6184887.811 45.58% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 2906788.007 21.42% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 1769958.318 13.04% AMSOUTH GROWTH & INCOME PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 1298415.623 9.57% ASO MODERATE GROWTH & INCOME PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 762989.072 5.62% AMSOUTH LIMITED TERM BOND FUND - CLASS A KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 374104.316 17.12% |
AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO SWEETWATER HOSPITAL PO BOX 105779 ATLANTA GA 30348 124584.336 5.70% AMSOUTH BANCORPORATION DEFERRED COMPENSATION STATE STREET BANK & TRST CO 200 NEWPORT AVE N QUINCY MA 02171 116021.696 5.31% AMSOUTH MID CAP FUND - CLASS A AMVESCAP NATL TR CO AS AGENT FOR AM BANK FBO AMSOUTH THRIFT PLAN PO BOX 105779 ATLANTA GA 30348 802916.574 48.91% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 91296.704 5.56% AMSOUTH MID CAP FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 7441208.353 52.27% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 2930649.379 20.59% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 2295303.215 16.12% AMSOUTH STRATEGIC PORTFOLIOS: MODERATE GROWTH & INCOME PORTFOLIO - CLASS A MCB TRUST SERVICES AS AGENT FOR FRONTIER TRUST CO AS TRUSTEE SUITE 300 700 17TH STREET DENVER CO 80202 258695.800 10.98% BISYS RETIREMENT SERVICES FBO WEST QUALITY FOOD SERVICE INC 401 SUITE 300 DENVER CO 80202 159234.626 6.76% HARTFORD LIFE INSURANCE COMPANY 200 HOPMEADOW STREET SIMSBURY CT 06089 122492.770 5.20% |
AMSOUTH STRATEGIC PORTFOLIOS: MODERATE GROWTH & INCOME PORTFOLIO - CLASS I
KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 924772.196 65.62% BISYS RETIREMENT SERVICES FBO C C CLARK INC 401 K PLAN SUITE 300 DENVER CO 80202 125779.661 8.93% AMSOUTH PRIME MONEY MARKET - CLASS B PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 161909.410 5.13% AMSOUTH PRIME MONEY MARKET - CLASS A PERSHING LLC FOR EXCLUSIVE BENEFIT OF 1 PERSHING PLAZA ATTN CASH MANAGEMENT JERSEY CITY NJ 073990002 379898167.130 91.84% AMSOUTH PRIME MONEY MARKET - CLASS I KENNEBURT & COMPANY PO BOX 11426 CSTDY UNIT ATTN PROPRIETARY FUNDS-RCS 5 BIRMINGHAM AL 352021426 187188291.480 88.44% AMSOUTH SELECT EQUITY FUND - CLASS A HARTFORD LIFE INSURANCE COMPANY 200 HOPMEADOW STREET SIMSBURY CT 06089 79018.203 5.38% AMSOUTH SELECT EQUITY FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 2612223.528 41.08% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 1484146.651 23.34% |
KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 879827.617 13.84% AMSOUTH GROWTH & INCOME PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 474197.822 7.46% AMSOUTH AGGRESSIVE GROWTH PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 349432.489 5.50% AMSOUTH GROWTH PORTFOLIO 3435 STELZER RD ATTN FUND ACCOUNTING COLUMBUS OH 43219 349007.389 5.49% AMSOUTH SMALL CAP FUND -- CLASS A KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 132743.418 11.61% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 108121.506 9.46% BISYS RETIREMENT SERVICES FBO SAWGRASS ASSET MGMT LLC 401 K PL SUITE 300 DENVER CO 80202 102357.551 8.96% AMSOUTH SMALL CAP FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 15266531.186 58.24% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 5060997.797 19.31% |
KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 3553803.391 13.56% AMSOUTH STRATEGIC PORTFOLIOS: AGGRESSIVE GROWTH FUND - CLASS A HARTFORD LIFE INSURANCE COMPANY 200 HOPMEADOW STREET SIMSBURY CT 06089 178046.693 7.44% BISYS RETIREMENT SERVICES FBO EAST CARROLL LUMBER YARD INC PROF SUITE 300 DENVER CO 80202 170079.283 7.11% AMVESCAP NATIONAL TRUST CO AS AGENT FOR AMSOUTH BANK FBO PO BOX 105779 ATLANTA GA 303485779 126965.217 5.31% AMSOUTH STRATEGIC PORTFOLIOS: AGGRESSIVE GROWTH FUND - CLASS I KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 466778.020 29.81% BISYS RETIREMENT SERVICES FBO C C CLARK INC 401K PLAN SUITE 300 DENVER CO 80202 229924.893 14.68% BISYS RETIREMENT SERVICES FBO WALKER-J-WALKER INC PROFIT SHARIN SUITE 300 DENVER CO 80202 144952.998 9.26% BISYS RETIREMENT SERVICES FBO SEABROOK EES PROFIT SHARING RETIREM SUITE 300 DENVER CO 80202 92304.222 5.89% AMSOUTH TAX-EXEMPT MONEY MARKET FUND - CLASS A PERSHING LLC FOR EXCLUSIVE BENEFIT OF 1 PERSHING PLAZA ATTN CASH MANAGEMENT JERSEY CITY NJ 073990002 23244618.300 73.44% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 4030386.870 12.73% |
NATIONAL FINANCIAL SERVICES CORP EXCLUSIVE BENEFIT OF OUR CUSTOMERS 200 LIBERTY ST ONE WORLD FINAN CENTER ATTN C ROBINSON NEW YORK NY 10281 3261858.500 10.30% AMSOUTH TAX-EXEMPT MONEY MARKET FUND - CLASS I KENNEBURT & COMPANY PO BOX 11426 CSTDY UNIT ATTN PROPRIETARY FUNDS-RCS 5 BIRMINGHAM AL 352021426 107917283.360 96.98% AMSOUTH TENNESSEE TAX-EXEMPT FUND - CLASS A KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 179781.205 35.21% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 95362.274 18.68% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 57233.178 11.21% AMSOUTH TENNESSEE TAX-EXEMPT FUND - CLASS B PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 23266.866 11.30% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 17255.803 8.38% PERSHING LLC ONE PERSHING PLAZA 14TH FLOOR JERSEY CITY NJ 07399 10945.262 5.32% |
PERSHING LLC
ONE PERSHING PLAZA
14TH FLOOR
JERSEY CITY NJ 07399 10488.014 5.09%
AMSOUTH TENNESSEE TAX-EXEMPT FUND - CLASS I
KENNEBURT & COMPANY FBO ASO TRUST
ATTN MUTUAL FUND OPERATIONS
PO BOX 12365
BIRMINGHAM AL 35202
1772994.531 62.92%
KENNEBURT & COMPANY FBO ASO TRUST
ATTN MUTUAL FUND OPERATIONS
PO BOX 12365
BIRMINGHAM AL 35202 995331.856 35.32%
AMSOUTH TREASURY RESERVES MONEY MARKET FUND - CLASS A
HARE & CO
111 SANDERS CREEK PKY
ATTN STIF/MASTER NOTE
E SYRACUSE NY 13057 38299358.430 52.54%
PERSHING LLC FOR EXCLUSIVE BENEFIT OF
1 PERSHING PLAZA
ATTN CASH MANAGEMENT
JERSEY CITY NJ 073990002 12126285.150 16.63%
KENNEBERT & CO
PO BOX 11426 PROPRIETARY FUNDS
ATTN PROPRIETARY FUNDS-RCS 5
BIRMINGHAM AL 352021426 8066816.700 11.07%
AMSOUTH TREASURY RESERVES MONEY MARKET FUND - CLASS I
KENNEBERT & CO
PO BOX 11426 PROPRIETARY FUNDS
ATTN PROPRIETARY FUNDS-RCS 5
BIRMINGHAM AL 352021426 94810912.500 89.50%
AMSOUTH VALUE FUND - CLASS A
AMVESCAP NATL TR CO AS AGENT FOR AM
BANK FBO AMSOUTH THRIFT PLAN
PO BOX 105779
ATLANTA GA 30348 2180962.955 27.62%
AMVESCAP NATIONAL TRUST CO AS AGENT
FOR AMSOUTH BANK FBO BCBS ALABAMA
PO BOX 105779
ATLANTA GA 30348 866126.184 10.97%
|
AMSOUTH VALUE FUND - CLASS I
KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 9568628.617 49.61% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 3850594.742 19.96% KENNEBURT & COMPANY FBO ASO TRUST ATTN MUTUAL FUND OPERATIONS PO BOX 12365 BIRMINGHAM AL 35202 2691930.204 13.96% |
As of May 31, 2005, the trustees and officers of your AmSouth Fund, as a group, owned in the aggregate less than 1% of the outstanding shares of your AmSouth Fund.
AmSouth Bank or other companies controlled by AmSouth Bancorporation (the "AmSouth Companies") beneficially own shares of certain AmSouth Funds. The AmSouth Companies intend to hire an independent fiduciary to vote their shares in a fiduciary capacity.
OWNERSHIP OF SHARES OF THE PIONEER FUNDS
To the knowledge of your Pioneer Fund, as of May 31, 2005, the following persons owned of record or beneficially 5% or more of the outstanding shares of each of the Pioneer Funds.
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
Pioneer America Income Fund
-----------------------------------------------------------------------------------
Class B MLPF&S For the Sole Benefit of its
Customers 11.07%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Class C MLPF&S For the Sole Benefit of its
Customers 27.84%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Attn Peter Booth 7.41%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
Class R MLPF&S For the Sole Benefit of its
Customers 31.00%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
Skyland Automotive Inc Emplo 12.60%
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
Big Boy 401(K) Plan & Trust 24.93%
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
United Construction Trades & 8.13%
Industrial Emp Int'l Union 401(K) Plan
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
MCB Trust Services Cust. F/B/O
Citizens Bank of Hartsville 7.37%
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
Charles Schwab & Co Inc.
Investor Class Exclusive Benefit of its Cust. 5.79%
Shares Attn: Mutual Fund Dept.
101 Montgomery St.
San Francisco, CA 94104-4122
-----------------------------------------------------------------------------------
Pioneer Bond Fund
-----------------------------------------------------------------------------------
MLPF&S
Class B For the Sole Benefit of its Customers 9.87%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class C For the Sole Benefit of its Customers 13.13%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Attn Peter Booth 24.02%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
MCB Trust Services Cust. FBO
Class R ABI Companies Inc/CLW Real Estate 10.28%
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 76.36%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
United Construction Trades & Industrial 8.37%
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
Emp Int'l Union 401(K)
700 17th St. Ste 300
Denver, CO 80202-3531
--------------------------------------------------------------------------------
Class Y John F. Cogan Jr.
C/O Hale and Dorr 6.06%
60 State Street
Boston, MA 02109-1800
-----------------------------------------------------------------------------------
FISERV Securities, Inc.
Attn: Mutual Funds 12.59%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
FISERV Securities, Inc.
Attn: Mutual Funds 25.16%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
FISERV Securities, Inc.
Attn: Mutual Funds 33.24%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
MLPF&S For the Sole Benefit of its
Customers 14.09%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
PIM IRA Cust For
Investor Class Theodore R Lundberg 9.48%
Shares 2526 174th Ave NE
Redmond, WA 98052-6222
-----------------------------------------------------------------------------------
PIM IRA Cust for
Marilyn M Davis 5.04%
1974 W Macarthur St
RCH Palos VRD, CA 90275-1110
-----------------------------------------------------------------------------------
Pioneer Cash Reserves Fund
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Class B Attn Peter Booth 5.53%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
Patterson & Co. FBO
Class R Global Power Systems & FL 401K Plan 39.94%
1525 West Wt Harris Blvd
Charlotte, NC 28288-0001
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
Big Boy 401(K) Plan & Trust 33.64%
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
Gerken Retirement Savings Plan 14.19%
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
Pioneer Funds Distributor Inc.
Class Y Attn: Melissa Semenza 100%
60 State Street
Boston, MA 02109-1800
-----------------------------------------------------------------------------------
Pioneer Fund
-----------------------------------------------------------------------------------
MLPF&S
Class B For the Sole Benefit of its Customers 14.40%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class C For the Sole Benefit of its Customers 35.36%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Attn Peter Booth 8.70%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
ING National Trust, Trustee
Class R Agreement And AETNA 403 (B) (7) 50.01%
Custodial Acct 3/26/97 Trustee for
Thomas J Botticelli DTD 04/22/1996
151 Farmington Ave - TN41
Hartford, CT 06156
-----------------------------------------------------------------------------------
AETNA Life Insurance & Annuity Co
151 Farmington Ave - TN41 28.19%
Hartford, CT 06156-0001
-----------------------------------------------------------------------------------
Pioneer Protected Principal Plus
Class Y Fund II 9.90%
60 State Street
Boston, MA 02109-1800
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 5.15%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
State St Bank and Trust Trustee
FBO Pacificorp K Plus Savings Plan 59.13%
Trust DTD 1/9/1996
805 Pennsylvania Ave
5th Floor, Tower 2
Kansas City, MO 64105-1307
-----------------------------------------------------------------------------------
State of Florida Public Employees
Optional Retirement Program 10.29%
1801 Hermitage Blvd Ste 100
Tallahassee, FL 32308-7743
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
Charles Schwab & Co Inc.
Investor Class Exclusive Benefit of its Cust. 17.71%
Attn: Mutual Fund Dept.
101 Montgomery St.
San Francisco, CA 94104-4122
-----------------------------------------------------------------------------------
Pioneer Growth Opportunities Fund
-----------------------------------------------------------------------------------
Charles Schwab & Co Inc.
Class A Exclusive Benefit of its Cust. 32.20%
Attn: Mutual Fund Dept.
101 Montgomery St.
San Francisco, CA 94104-4122
-----------------------------------------------------------------------------------
State Street Bank & Trust Co TTEE
U/A Dated 02/01/00 43.87%
Lowe's 401(K) Plan
105 Rosemont Rd #1
Westwood, MA 02090-2318
-----------------------------------------------------------------------------------
First Clearing, LLC
Class B Michael Reiman TTE 24.97%
Mae Edison C R U TR DTD 6/8/98
PO Box 654
Palm Beach, FL 33480-0654
-----------------------------------------------------------------------------------
PIM USA 401(K) TTEE for
Susanne M Berneski 7.77%
4718 Warm Hearth Circle
Fairfax, VA 22033-5075
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
Class C Drew Pearson Marketing Inc. 50.13%
401(K) Plan
700 17th St. Ste 300
Denver, CO 80202-3531
-----------------------------------------------------------------------------------
First Clearing, LLC
Michael Reiman TTE 5.49%
Mae Edison C R U TR DTD 6/8/98
PO Box 654
Palm Beach, FL 33480-0654
-----------------------------------------------------------------------------------
Wells Fargo Investments LLC
625 Marguette Ave S 13th Floor 9.33%
Minneapolis MN 55402-2308
-----------------------------------------------------------------------------------
PIM USA 401(K) TTEE for
Estes Electrical Service 5.23%
David R. Estes
806 Boulder DR
Prescott, AZ 86303-5251
-----------------------------------------------------------------------------------
Investor Class Charles Schwab & Co Inc. 19.02%
Shares Exclusive Benefit of its Cust.
Attn: Mutual Fund Dept.
101 Montgomery St.
San Francisco, CA 94104-4122
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
-----------------------------------------------------------------------------------
Pioneer Ibbotson Aggressive Allocation Fund
-----------------------------------------------------------------------------------
MLPF&S
Class A For the Sole Benefit of its Customers 5.83%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class B For the Sole Benefit of its Customers 18.33%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class C For the Sole Benefit of its Customers 31.43%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Pioneer Ibbotson Growth Allocation Fund
-----------------------------------------------------------------------------------
MLPF&S
Class A For the Sole Benefit of its Customers 5.33%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class C For the Sole Benefit of its Customers 30.10%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville FL 32246-6484
-----------------------------------------------------------------------------------
Pioneer Ibbotson Moderate Allocation Fund
-----------------------------------------------------------------------------------
MLPF&S
Class A For the Sole Benefit of its Customers 17.48%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class B For the Sole Benefit of its Customers 7.51%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class C For the Sole Benefit of its Customers 28.89%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Pioneer Mid Cap Value Fund
-----------------------------------------------------------------------------------
MLPF&S
Class B For the Sole Benefit of its Customers 8.16%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
MLPF&S
Class C For the Sole Benefit of its Customers 18.73%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Attn Peter Booth 9.61%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
Hartford Life Insurance Company
Class R PO Box 2999 33.37%
Hartford, CT 06104-2999
-----------------------------------------------------------------------------------
ING National Trust, Trustee
Agreement And AETNA 403(B) (7) 8.54%
Custodial Acct 3/26/97 Trustee for
Thomas J Botticelli DTD 04/22/1996
151 Farmington Ave - TN41
Hartford, CT 06156
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 7.75%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
AETNA Life Insurance & Annuity Co
151 Farmington Ave - TN41 16.18%
Hartford, CT 06156-0001
-----------------------------------------------------------------------------------
Capinco C/O US Bank
Class Y PO Box 1787 13/74%
Milwaukee, WI 53201-1787
-----------------------------------------------------------------------------------
Raymond James & Assoc Inc.
FBO Helios Educatio 9.09%
880 Carillon PKWY
St Petersburg, FL 33716-1100
-----------------------------------------------------------------------------------
First Command Bank
Attn: Trust Department 53.08%
PO Box 901075
Fort Worth, TX 76101-2075
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 6.16%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Charles Schwab & Co Inc.
Investor Class Exclusive Benefit of its Cust. 5.51%
Shares Attn: Mutual Fund Dept.
101 Montgomery St.
San Francisco, CA 94104-4122
-----------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth Fund
-----------------------------------------------------------------------------------
SEI Private Trust Co
Class A C/O Wachovia Bank 10.58%
Attn: Mutual Funds Administrators
One Freedom Valley Drive
Oaks, PA 19456
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 13.44%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S
Class B For the Sole Benefit of its Customers 15.24%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Attn Peter Booth 8.29%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
MLPF&S
Class C For the Sole Benefit of its Customers 46.00%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
3. Attn Peter Booth 9.03%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
Wilmington Trust Comp Cust FBO
Class R Grand Lake Ace Hardware, Inc. 36.01%
Profit Sharing PL A/C
C/O Mutual Funds
PO Box 8971
Wilmington, DE 19899-8971
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 29.36%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MCB Trust Services Cust FBO
Temple Inc 401K Plan 34.34%
700 17th St Ste 300
Denver CO 80202-3531
-----------------------------------------------------------------------------------
First Command Bank
Class Y Attn: Trust Dept 89.34%
PO Box 901075
Forth Worth, TX 76101-2075
-----------------------------------------------------------------------------------
Pioneer Short Term Income Fund
-----------------------------------------------------------------------------------
A G Edwards & Sons Inc FBO
Class A City of Lincoln 43.44%
One North Jefferson
St. Louis, MO 63103-2205
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
A G Edwards & Sons Inc FBO
City of Lincoln 18.77%
One North Jefferson
St. Louis, MO 63103-2205
-----------------------------------------------------------------------------------
Grand Lodge FOP
C/O Thomas Penzoa Natl Treasurer 12.15%
215 Sterling Ave
New Castle, DE 19720-4729
-----------------------------------------------------------------------------------
Pioneer Funds Distributor Inc
Class B Attn Carrie Cuscia 7.56%
60 State St
Boston, MA 02109-1800
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 69.87%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
Pershing LLC
Class C PO Box 2052 6.02%
Jersey City NJ 07303-2052
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 34.48%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville FL 32246-6484
-----------------------------------------------------------------------------------
Attn: Mutual Funds
Class Y FISERV Securities, Inc. 35.31%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
Attn: Mutual Funds
FISERV Securities, Inc. 57.07%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
Pioneer Tax Free Income Fund
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Class B Attn Peter Booth 11.04%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
MLPF&S
For the Sole Benefit of its Customers 17.44%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
MLPF&S For the Sole Benefit of its
Class C Customers 20.37%
Mutual Fund Administration
4800 Deer Lake Drive East 2nd Floor
Jacksonville, FL 32246-6484
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
Citigroup Global Markets Inc.
Attn Peter Booth 14.28%
333 West 24th St. 7th Fl.
New York, NY 10001-2402
-----------------------------------------------------------------------------------
John F Cogan Jr
Class Y C/O Hale and Dorr 100%
60 State Street
Boston, MA 02109-1800
-----------------------------------------------------------------------------------
Charles Schwab & Co Inc.
Investor Class Exclusive Benefit of its Cust. 12.13%
Shares Attn: Mutual Fund Dept.
101 Montgomery St.
San Francisco, CA 94104-4122
-----------------------------------------------------------------------------------
William A Helsell
10653 Culpepper CT NW 16.64%
Seattle, WA 98177-5319
-----------------------------------------------------------------------------------
Howard C Lincoln and
Grace V Lincoln Com Prop 9.50%
6 Holly Hill Dr
Mercer Island, WA 98040-5326
-----------------------------------------------------------------------------------
Pioneer Tax Free Money Market Fund
-----------------------------------------------------------------------------------
Anne H Hagedorn &
Class A Fritz G Hagedorn JTWROS 10.54%
5224 69th Dr NE
Marysville, WA 98270-8840
-----------------------------------------------------------------------------------
Robert L Odegard &
Elizabeth A Odegard JT WROS 5.05%
PO Box 165
Medina, WA 98039-0165
-----------------------------------------------------------------------------------
Alton Jennings
10 E Roanoke St Apt 13 5.41%
Seattle, WA 98102-3259
-----------------------------------------------------------------------------------
Prema Bharath
318 15th Ave SE 7.62%
Devils Lake, ND 58301-7000
-----------------------------------------------------------------------------------
Victor C Moses And
Mary K Moses JTWROS 25.69%
5210 NE 43rd St
Seattle, WA 98105-4915
-----------------------------------------------------------------------------------
Debra A Tessier &
Richard K Timbrell JT TEN 7.45%
92 Addison Dr
Short Hills, NJ 07078-1833
-----------------------------------------------------------------------------------
Doris J Moehring
Investor Class 3718 W Commodore Way 5.42%
Shares Seattle, WA 98199-1104
-----------------------------------------------------------------------------------
Pioneer Value Fund
-----------------------------------------------------------------------------------
PFPC
Class A FBO Primerica Shareholder Services 20.95%
211 S Gulf Rd
King of Prussia, PA 19406
-----------------------------------------------------------------------------------
|
-----------------------------------------------------------------------------------
Fund/Class Shareholder Name and Address Percentage of Class
Held by Shareholder
-----------------------------------------------------------------------------------
Nuernberger Lebensversicherung AG
KA-Controlling 5.88%
Ostendstr. 100
D-90334 Nurnberg
Mittelfr, Germany
-----------------------------------------------------------------------------------
Circle Trust Co Custodian For
Class R GoldK Omnibus Account 31.63%
401K Plan
1 Thorndal Cir
Darien, CT 06820-5421
-----------------------------------------------------------------------------------
Francis Cassidy & Dennis Mathias
TTEES FBO Athletic Clubs 65.15%
International 401K PSP
2729 St Marys Rd
Ardmore, PA 19003-2026
-----------------------------------------------------------------------------------
FISERV Securities, Inc.
Class Y Attn: Mutual Funds 24.52%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
FISERV Securities, Inc.
Attn: Mutual Funds 34.26%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
FISERV Securities, Inc.
Attn: Mutual Funds 28.06%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
FISERV Securities, Inc.
Attn: Mutual Funds 5.21%
One Commerce Square
2005 Market Street Suite 1200
Philadelphia, PA 19103-7084
-----------------------------------------------------------------------------------
Charles Schwab & Co Inc.
Investor Class Exclusive Benefit of its Cust. 8.92%
Shares Attn: Mutual Fund Dept.
101 Montgomery St.
San Francisco, CA 94104-4122
-----------------------------------------------------------------------------------
|
As of May 31, 2005, the trustees and officers of each Pioneer Fund owned less than 1% of the outstanding shares of each Pioneer Fund.
EXPERTS
AmSouth Funds
The financial statements and financial highlights of each AmSouth Fund incorporated by reference in the respective AmSouth Funds' Annual Report for the most recent fiscal year end have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports thereon incorporated by reference into this registration statement. Such financial statements and financial highlights are incorporated herein by reference in reliance on such reports given on the authority of such firm as experts in accounting and auditing.
Pioneer Funds
The financial statements and financial highlights of each Pioneer Fund incorporated by reference in the respective Pioneer Fund's Annual Report for the most recent fiscal year end have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports thereon incorporated by reference into this registration statement. Such financial statements and financial highlights are incorporated herein by reference in reliance on such reports given the authority of such firm as experts in accounting and auditing.
AVAILABLE INFORMATION
The AmSouth Funds and the Pioneer Funds are subject to the informational requirements of the Securities Exchange Act of 1934 and the Investment Company Act and file reports, proxy statements and other information with the SEC. These reports, proxy statements and other information filed by the Funds can be inspected and copied (for a duplication fee) at the public reference facilities of the SEC at 450 Fifth Street, N.W., Washington, D.C. Copies of these materials can also be obtained by mail from the Public Reference Branch, Office of Consumer Affairs and Information Services, SEC, Washington, D.C. 20549, at prescribed rates. In addition, copies of these documents may be viewed on-screen or downloaded from the SEC's Internet site at http://www.sec.gov.
Draft
Exhibit A-1--Form of Agreement and Plan of Reorganization
(C/D Reorganizations)
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of the __ day of _______ 2005, by and between Pioneer [____] Fund, a Delaware statutory trust (the "Acquiring Trust"), on behalf of its sole series Pioneer [____] Fund (the "Acquiring Fund"), with its principal place of business at 60 State Street, Boston, Massachusetts 02109, and AmSouth Funds, a Massachusetts business trust (the "AmSouth Trust"), on behalf of its series [ ] Fund (the "Acquired Fund"), with its principal place of business at 3435 Stelzer Road, Columbus, Ohio 43219. The Acquiring Fund and the Acquired Fund are sometimes referred to collectively herein as the "Funds" and individually as a "Fund."
This Agreement is intended to be and is adopted as a plan of a "reorganization" as defined in Section 368(a)(1)[(C)/(D)] of the United States Internal Revenue Code of 1986, as amended (the "Code") and the Treasury Regulations thereunder. The reorganization (the "Reorganization") will consist of (1) the transfer of all of the assets of the Acquired Fund to the Acquiring Fund in exchange solely for (A) the issuance of Class A, Class B and Class Y shares of beneficial interest of the Acquiring Fund (collectively, the "Acquiring Fund Shares" and each, an "Acquiring Fund Share") to the Acquired Fund, and (B) the assumption by the Acquiring Fund of the liabilities of the Acquired Fund that are both set forth on the Statements of Assets and Liabilities (as defined below) and also included in the calculation of net asset value ("NAV") on the closing date of the Reorganization (the "Closing Date") (collectively, the "Assumed Liabilities"), and (2) the distribution by the Acquired Fund, on or promptly after the Closing Date as provided herein, of the Acquiring Fund Shares to the shareholders of the Acquired Fund in liquidation and dissolution of the Acquired Fund, all upon the terms and conditions hereinafter set forth in this Agreement.
WHEREAS, the Acquiring Trust and the AmSouth Trust are each registered investment companies classified as management companies of the open-end type.
WHEREAS, the Acquiring Fund is authorized to issue shares of beneficial interest.
WHEREAS, the Board of Trustees of the AmSouth Trust and the Board of Trustees of the Acquiring Trust have determined that the Reorganization is in the best interests of the Acquired Fund shareholders and the Acquiring Fund shareholders, respectively, and is not dilutive of the interests of those shareholders.
NOW, THEREFORE, in consideration of the premises of the covenants and agreements hereinafter set forth, the parties hereto covenant and agree as follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND IN EXCHANGE FOR THE ACQUIRING FUND SHARES AND ASSUMPTION OF THE ASSUMED LIABILITIES; LIQUIDATION AND TERMINATION OF THE ACQUIRED FUND.
1.1 Subject to the terms and conditions herein set forth and on the basis of the representations and warranties contained herein, the Acquired Fund will transfer all of its assets as set forth in Paragraph 1.2 (the "Acquired Assets") to the Acquiring Fund free and clear of all liens and encumbrances (other than those arising under the Securities Act of 1933, as amended (the "Securities Act"), liens for taxes not yet due and contractual restrictions on the transfer of the Acquired Assets) and the Acquiring Fund agrees in exchange therefor: (i) to issue to the Acquired Fund the number of Acquiring Fund Shares, including fractional Acquiring Fund Shares, of each class with an aggregate NAV equal to the NAV of the Acquired Fund attributable to the corresponding class of the Acquired Fund's shares, as determined in the manner set forth in Paragraphs 2.1 and 2.2; and (ii) to assume the Assumed Liabilities. Such transactions shall take place at the Closing (as defined in Paragraph 3.1 below).
1.2 (a) The Acquired Assets shall consist of all of the Acquired Fund's property, including, without limitation, all portfolio securities and instruments, dividends and interest receivables, cash, goodwill, contractual rights and choses in action of the Acquired Fund or the AmSouth Trust in respect of the Acquired Fund, all other intangible property owned by the Acquired Fund, originals or copies of all books and records of the
Acquired Fund, and all other assets of the Acquired Fund on the Closing Date. The Acquiring Fund shall also be entitled to receive (or, to the extent agreed upon between the AmSouth Trust and the Acquiring Trust, be provided access to) copies of all records that the AmSouth Trust is required to maintain under the Investment Company Act of 1940, as amended (the "Investment Company Act"), and the rules of the Securities and Exchange Commission (the "Commission") thereunder to the extent such records pertain to the Acquired Fund.
(b) The Acquired Fund has provided the Acquiring Fund with a list of all of the Acquired Fund's securities and other assets as of the date of execution of this Agreement, and the Acquiring Fund has provided the Acquired Fund with a copy of the current fundamental investment policies and restrictions and fair value procedures applicable to the Acquiring Fund. The Acquired Fund reserves the right to sell any of such securities or other assets before the Closing Date (except to the extent sales may be limited by representations of the Acquired Fund contained herein and made in connection with the issuance of the tax opinion provided for in Paragraph 8.5 hereof).
1.3 The Acquired Fund will endeavor to discharge all of its known liabilities and obligations that are or will become due prior to the Closing.
1.4 On or as soon after the Closing Date as is conveniently practicable (the "Liquidation Date"), the AmSouth Trust shall liquidate the Acquired Fund and distribute pro rata to its shareholders of record, determined as of the close of regular trading on the New York Stock Exchange on the Closing Date (the "Acquired Fund Shareholders"), the Acquiring Fund Shares received by the Acquired Fund pursuant to Paragraph 1.1 hereof. Each Acquired Fund Shareholder shall receive the number of Acquiring Fund Shares of the class corresponding to the class of shares of beneficial interest of the Acquired Fund (the "Acquired Fund Shares") held by such Acquired Fund Shareholder that have an aggregate NAV equal to the aggregate NAV of the Acquired Fund Shares held of record by such Acquired Fund Shareholder on the Closing Date. Such liquidation and distribution will be accomplished by the AmSouth Trust instructing the Acquiring Trust to transfer the Acquiring Fund Shares then credited to the account of the Acquired Fund on the books of the Acquiring Fund to open accounts on the share records of the Acquiring Fund established and maintained by the Acquiring Fund's transfer agent in the names of the Acquired Fund Shareholders and representing the respective pro rata number of the Acquiring Fund Shares due the Acquired Fund Shareholders. The AmSouth Trust shall promptly provide the Acquiring Trust with evidence of such liquidation and distribution. All issued and outstanding Acquired Fund Shares will simultaneously be cancelled on the books of the Acquired Fund, and the Acquired Fund will be dissolved. The Acquiring Fund shall not issue certificates representing the Acquiring Fund Shares in connection with such exchange.
1.5 Ownership of Acquiring Fund Shares will be shown on the books of the Acquiring Fund's transfer agent. Any certificates representing ownership of Acquired Fund Shares that remain outstanding on the Closing Date shall be deemed to be cancelled and shall no longer evidence ownership of Acquired Fund Shares.
1.6 Any transfer taxes payable upon issuance of Acquiring Fund Shares in a name other than the registered holder of the Acquired Fund Shares on the books of the Acquired Fund as of that time shall, as a condition of such issuance and transfer, be paid by the person to whom such Acquiring Fund Shares are to be issued and transferred.
1.7 Any reporting responsibility of the AmSouth Trust with respect to the Acquired Fund for taxable periods ending on or before the Closing Date, including, but not limited to, the responsibility for filing of regulatory reports, Tax Returns (as defined in Paragraph 4.1), or other documents with the Commission, any state securities commissions, and any federal, state or local tax authorities or any other relevant regulatory authority, is and shall remain the responsibility of the AmSouth Trust.
2. VALUATION
2.1 The NAV of the Acquiring Fund Shares and the NAV of the Acquired Fund shall, in each case, be determined as of the close of business (4:00 p.m., Boston time) on the Closing Date (the "Valuation Time"). The NAV of each Acquiring Fund Share shall be computed by Pioneer Investment Management, Inc. (the "Acquiring Fund Adviser") in the manner set forth in the Acquiring Fund's Declaration of Trust (the "Declaration"), or By-Laws, and the Acquiring Fund's then-current prospectus and statement of additional information. The NAV of the
Acquired Fund shall be computed by ASO Services Company, Inc. (the "Acquired Fund Administrator") by calculating the value of the Acquired Assets and by subtracting therefrom the amount of the liabilities of the Acquired Fund on the Closing Date included on the Statement of Assets and Liabilities of the Acquired Fund delivered pursuant to Paragraph 5.7 (the "Statement of Assets and Liabilities"), said assets and liabilities to be valued in the manner set forth in the Acquiring Fund's then current prospectus and statement of additional information. The Acquiring Fund Adviser shall confirm to the Acquiring Fund the NAV of the Acquired Fund.
2.2 The number of Acquiring Fund Shares to be issued (including fractional shares, if any) in exchange for the Acquired Assets and the assumption of the Assumed Liabilities shall be determined by the Acquiring Fund Adviser by dividing the NAV of the Acquired Fund, as determined in accordance with Paragraph 2.1, by the NAV of each Acquiring Fund Share, as determined in accordance with Paragraph 2.1.
2.3 The Acquiring Fund and the Acquired Fund shall cause the Acquiring Fund Adviser and the Acquired Fund Administrator, respectively, to deliver a copy of its valuation report to the other party at Closing. All computations of value shall be made by the Acquiring Fund Adviser and the Acquired Fund Administrator in accordance with its regular practice as pricing agent for the Acquiring Fund and the Acquired Fund, respectively.
3. CLOSING AND CLOSING DATE
3.1 The Closing Date shall be [ ], 2005, or such later date as the parties may agree to in writing. All acts necessary to consummation the Reorganization (the "Closing") shall be deemed to take place simultaneously as of 5:00 p.m. (Eastern time) on the Closing Date unless otherwise provided. The Closing shall be held at the offices of Wilmer Cutler Pickering Hale and Dorr LLP, 60 State Street, Boston, Massachusetts, or at such other place as the parties may agree.
3.2 Portfolio securities that are held other than in book-entry form in the name of AmSouth Bank (the "Acquired Fund Custodian") as record holder for the Acquired Fund shall be presented by the Acquired Fund to Brown Brothers Harriman & Co. (the "Acquiring Fund Custodian") for examination no later than three business days preceding the Closing Date. Such portfolio securities shall be delivered by the Acquired Fund to the Acquiring Fund Custodian for the account of the Acquiring Fund on the Closing Date, duly endorsed in proper form for transfer, in such condition as to constitute good delivery thereof in accordance with the custom of brokers, and shall be accompanied by all necessary federal and state stock transfer stamps or a check for the appropriate purchase price thereof. Portfolio securities held of record by the Acquired Fund Custodian in book-entry form on behalf of the Acquired Fund shall be delivered by the Acquired Fund Custodian through the Depository Trust Company to the Acquiring Fund Custodian and by the Acquiring Fund Custodian recording the beneficial ownership thereof by the Acquiring Fund on the Acquiring Fund Custodian's records. Any cash shall be delivered by the Acquired Fund Custodian transmitting immediately available funds by wire transfer to the Acquiring Fund Custodian the cash balances maintained by the Acquired Fund Custodian and the Acquiring Fund Custodian crediting such amount to the account of the Acquiring Fund.
3.3 The Acquiring Fund Custodian shall deliver within one business day after the Closing a certificate of an authorized officer stating that: (a) the Acquired Assets have been delivered in proper form to the Acquiring Fund on the Closing Date, and (b) all necessary transfer taxes including all applicable federal and state stock transfer stamps, if any, have been paid, or provision for payment has been made in conjunction with the delivery of portfolio securities as part of the Acquired Assets.
3.4 If on the Closing Date (a) the New York Stock Exchange is closed to trading or trading thereon shall be restricted or (b) trading or the reporting of trading on such exchange or elsewhere is disrupted so that accurate appraisal of the NAV of the Acquiring Fund Shares or the Acquired Fund pursuant to Paragraph 2.1 is impracticable, the Closing Date shall be postponed until the first business day after the day when trading shall have been fully resumed and reporting shall have been restored.
3.5 The Acquired Fund shall deliver at the Closing a list of the names, addresses, federal taxpayer identification numbers and backup withholding and nonresident alien withholding status and certificates of the Acquired Fund Shareholders and the number and percentage ownership of outstanding Acquired Fund Shares owned by each Acquired Fund Shareholder as of the Valuation Time, certified by the President or a Secretary of the
AmSouth Trust and its Treasurer, Secretary or other authorized officer (the "Shareholder List") as being an accurate record of the information (a) provided by the Acquired Fund Shareholders, (b) provided by the Acquired Fund Custodian, or (c) derived from the AmSouth Trust's records by such officers or one of the AmSouth Trust's service providers. The Acquiring Fund shall issue and deliver to the Acquired Fund a confirmation evidencing the Acquiring Fund Shares to be credited on the Closing Date, or provide evidence satisfactory to the Acquired Fund that such Acquiring Fund Shares have been credited to the Acquired Fund's account on the books of the Acquiring Fund. At the Closing, each party shall deliver to the other such bills of sale, checks, assignments, stock certificates, receipts or other documents as such other party or its counsel may reasonably request.
4. REPRESENTATIONS AND WARRANTIES
4.1 Except as set forth on a disclosure schedule previously provided by the AmSouth Trust to the Acquiring Trust (which disclosure schedule shall be organized by the sections of this Section 4.1 and any disclosure shall only modify the portions of this Section 4.1 expressly identified in such schedule), the AmSouth Trust, on behalf of the Acquired Fund, represents, warrants and covenants to the Acquiring Fund, which representations, warranties and covenants will be true and correct on the date hereof and on the Closing Date as though made on and as of the Closing Date, as follows:
(a) The Acquired Fund is a series of the AmSouth Trust. The AmSouth Trust is a business trust validly existing and in good standing under the laws of the Commonwealth of Massachusetts and has the power to own all of its properties and assets and, subject to approval by the Acquired Fund's shareholders, to perform its obligations under this Agreement. The Acquired Fund is not required to qualify to do business in any jurisdiction in which it is not so qualified or where failure to qualify would subject it to any material liability or disability. Each of the AmSouth Trust and the Acquired Fund has all necessary federal, state and local authorizations to own all of its properties and assets and to carry on its business as now being conducted;
(b) The AmSouth Trust is a registered investment company classified as a management company of the open-end type, and its registration with the Commission as an investment company under the Investment Company Act is in full force and effect;
(c) The AmSouth Trust is not in violation of, and the execution and delivery of this Agreement and the performance of its obligations under this Agreement in respect of the Acquired Fund will not result in a violation of, any provision of the AmSouth Trust's Trust Instrument or By-Laws or any material agreement, indenture, instrument, contract, lease or other undertaking with respect to the Acquired Fund to which the AmSouth Trust is a party or by which the Acquired Fund or any of its assets are bound;
(d) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or to its knowledge threatened against the Acquired Fund or any of the Acquired Fund's properties or assets. The Acquired Fund knows of no facts which might form the basis for the institution of such proceedings. Neither the AmSouth Trust nor the Acquired Fund is a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially adversely affects the Acquired Fund's business or its ability to consummate the transactions contemplated herein or would be binding upon the Acquiring Fund as the successor to the Acquired Fund;
(e) The Acquired Fund has no material contracts or other commitments (other than this Agreement or agreements for the purchase and sale of securities entered into in the ordinary course of business and consistent with its obligations under this Agreement) which will not be terminated at or prior to the Closing Date and no such termination will result in liability to the Acquired Fund (or the Acquiring Fund);
(f) The statement of assets and liabilities of the Acquired Fund, and the related statements of operations and changes in net assets, as of and for the fiscal year ended July 31, 2004, have been audited by Ernst & Young LLP, independent registered public accounting firm, and are in accordance with generally accepted accounting principles ("GAAP") consistently applied and fairly reflect,
in all material respects, the financial condition of the Acquired Fund as of such date and the results of its operations for the period then ended, and all known liabilities, whether actual or contingent, of the Acquired Fund as of the date thereof are disclosed therein. The Statement of Assets and Liabilities will be in accordance with GAAP consistently applied and will fairly reflect, in all material respects, the financial condition of the Acquired Fund as of such date and the results of its operations for the period then ended. Except for the Assumed Liabilities, the Acquired Fund will not have any known or contingent liabilities on the Closing Date. No significant deficiency, material weakness, fraud, significant change or other factor that could significantly affect the internal controls of the Acquired Fund has been disclosed or is required to be disclosed in the Acquired Fund's reports on Form N-CSR to enable the chief executive officer and chief financial officer or other officers of the Acquired Fund to make the certifications required by the Sarbanes-Oxley Act, and no deficiency, weakness, fraud, change, event or other factor exists that will be required to be disclosed in the Acquiring Fund's Form N-CSR after the Closing Date;
(g) Since the most recent fiscal year end, except as specifically disclosed in the Acquired Fund's prospectus, its statement of additional information as in effect on the date of this Agreement, or its semi-annual report for the period ended January 31, 2005, there has not been any material adverse change in the Acquired Fund's financial condition, assets, liabilities, business or prospects, or any incurrence by the Acquired Fund of indebtedness, except for normal contractual obligations incurred in the ordinary course of business or in connection with the settlement of purchases and sales of portfolio securities. For the purposes of this subparagraph (g) (but not for any other purpose of this Agreement), a decline in NAV per Acquired Fund Share arising out of its normal investment operations or a decline in market values of securities in the Acquired Fund's portfolio or a decline in net assets of the Acquired Fund as a result of redemptions shall not constitute a material adverse change;
(h) (A) For each taxable year of its operation since its inception, the Acquired Fund has met, and for the current taxable year it will meet, the requirements of Subchapter M of the Code for qualification and treatment as a regulated investment company. The Acquired Fund will qualify as such as of the Closing Date and will satisfy the diversification requirements of Section 851(b)(3) of the Code without regard to the last sentence of Section 851(d) of the Code. The Acquired Fund has not taken any action, caused any action to be taken or caused any action to fail to be taken which action or failure could cause the Acquired Fund to fail to qualify as a regulated investment company under the Code;
(B) Within the times and in the manner prescribed by law, the Acquired Fund has properly filed on a timely basis all Tax Returns (as defined below) that it was required to file, and all such Tax Returns were complete and accurate in all respects. The Acquired Fund has not been informed by any jurisdiction that the jurisdiction believes that the Acquired Fund was required to file any Tax Return that was not filed; and the Acquired Fund does not know of any basis upon which a jurisdiction could assert such a position;
(C) The Acquired Fund has timely paid, in the manner prescribed by law, all Taxes (as defined below), which were due and payable or which were claimed to be due;
(D) All Tax Returns filed by the Acquired Fund constitute complete and accurate reports of the respective Tax liabilities and all attributes of the Acquired Fund or, in the case of information returns and payee statements, the amounts required to be reported, and accurately set forth all items required to be included or reflected in such returns;
(E) The Acquired Fund has not waived or extended any applicable statute of limitations relating to the assessment or collection of Taxes;
(F) The Acquired Fund has not been notified that any examinations of the Tax Returns of the Acquired Fund are currently in progress or threatened, and no deficiencies have been asserted or assessed against the Acquired Fund as a result of any audit by the Internal Revenue Service or any state, local or foreign taxing authority, and, to its knowledge, no such deficiency has been proposed or threatened;
(G) The Acquired Fund has no actual or potential liability for any Tax obligation of any taxpayer other than itself. The Acquired Fund is not and has never been a member of a group of corporations with which it has filed (or been required to file) consolidated, combined or unitary Tax Returns. The Acquired Fund is not a party to any Tax allocation, sharing, or indemnification agreement;
(H) The unpaid Taxes of the Acquired Fund for tax periods through the Closing Date do not exceed the accruals and reserves for Taxes (excluding accruals and reserves for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the Statement of Assets and Liabilities, rather than in any notes thereto (the "Tax Reserves"). All Taxes that the Acquired Fund is or was required by law to withhold or collect have been duly withheld or collected and, to the extent required, have been timely paid to the proper governmental agency;
(I) The Acquired Fund has delivered to the Acquiring Fund or made available to the Acquiring Fund complete and accurate copies of all Tax Returns of the Acquired Fund, together with all related examination reports and statements of deficiency for all periods not closed under the applicable statutes of limitations and complete and correct copies of all private letter rulings, revenue agent reports, information document requests, notices of proposed deficiencies, deficiency notices, protests, petitions, closing agreements, settlement agreements, pending ruling requests and any similar documents submitted by, received by or agreed to by or on behalf of the Acquired Fund. The Acquired Fund has disclosed on its federal income Tax Returns all positions taken therein that could give rise to a substantial understatement of federal income Tax within the meaning of Section 6662 of the Code;
(J) The Acquired Fund has not undergone, has not agreed to undergo,
and is not required to undergo (nor will it be required as a result of the
transactions contemplated in this Agreement to undergo) a change in its method
of accounting resulting in an adjustment to its taxable income pursuant to
Section 481 of the Code. The Acquired Fund will not be required to include any
item of income in, or exclude any item of deduction from, taxable income for any
taxable period (or portion thereof) ending after the Closing Date as a result of
any (i) change in method of accounting for a taxable period ending on or prior
to the Closing Date under Section 481(c) of the Code (or any corresponding or
similar provision of state, local or foreign income Tax law); (ii) "closing
agreement" as described in Section 7121 of the Code (or any corresponding or
similar provision of state, local or foreign income Tax law) executed on or
prior to the Closing Date; (iii) installment sale or open transaction
disposition made on or prior to the Closing Date; or (iv) prepaid amount
received on or prior to the Closing Date;
(K) The Acquired Fund has not taken or agreed to take any action, and is not aware of any agreement, plan or other circumstance, that is inconsistent with the representations set forth in Annex B;
(L) There are (and as of immediately following the Closing there will be) no liens on the assets of the Acquired Fund relating to or attributable to Taxes, except for Taxes not yet due and payable;
(M) The Tax bases of the assets of the Acquired Fund are accurately reflected on the Acquired Fund's Tax books and records;
(N) The Acquired Fund has not incurred (or been allocated) an "overall foreign loss" as defined in Section 904(f)(2) of the Code which has not been previously recaptured in full as provided in Sections 904(f)(2) and/or 904(f)(3) of the Code;
(O) The Acquired Fund is not a party to a gain recognition agreement under Section 367 of the Code;
(P) The Acquired Fund does not own any interest in an entity that is characterized as a partnership for income tax purposes;
(Q) The Acquired Fund's Tax attributes are not limited under the Code (including but not limited to any capital loss carry forward limitations under Sections 382 or 383 of the Code and the Treasury Regulations thereunder) or comparable provisions of state law; and
(R) For purposes of this Agreement, "Taxes" or "Tax" shall mean all taxes, charges, fees, levies or other similar assessments or liabilities, including without limitation income, gross receipts, ad valorem, premium, value-added, excise, real property, personal property, sales, use, transfer, withholding, employment, unemployment, insurance, social security, business license, business organization, environmental,
workers compensation, payroll, profits, license, lease, service, service use, severance, stamp, occupation, windfall profits, customs, duties, franchise and other taxes imposed by the United States of America or any state, local or foreign government, or any agency thereof, or other political subdivision of the United States or any such government, and any interest, fines, penalties, assessments or additions to tax resulting from, attributable to or incurred in connection with any tax or any contest or dispute thereof; and "Tax Returns" shall mean all reports, returns, declarations, statements or other information required to be supplied to a governmental or regulatory authority or agency, or to any other person, in connection with Taxes and any associated schedules or work papers produced in connection with such items;
(i) All issued and outstanding Acquired Fund Shares are, and at the Closing Date will be, duly and validly issued and outstanding, fully paid and nonassessable by the Acquired Fund. All of the issued and outstanding Acquired Fund Shares will, at the time of Closing, be held of record by the persons and in the amounts set forth in the Shareholder List submitted to the Acquiring Fund pursuant to Paragraph 3.5 hereof. The Acquired Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any Acquired Fund Shares, nor is there outstanding any security convertible into any Acquired Fund Shares;
(j) At the Closing Date, the Acquired Fund will have good and marketable title to the Acquired Assets, and full right, power and authority to sell, assign, transfer and deliver the Acquired Assets to the Acquiring Fund, and, upon delivery and payment for the Acquired Assets, the Acquiring Fund will acquire good and marketable title thereto, subject to no restrictions on the full transfer thereof, except such restrictions as might arise under the Securities Act;
(k) The AmSouth Trust has the trust power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement have been duly authorized by all necessary action on the part of the AmSouth Trust's Board of Trustees, and, subject to the approval of the Acquired Fund's shareholders, assuming due authorization, execution and delivery by the Acquiring Fund, this Agreement will constitute a valid and binding obligation of the Acquired Fund, enforceable in accordance with its terms, subject as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and other laws relating to or affecting creditors' rights and to general equity principles;
(l) The information to be furnished by the Acquired Fund to the Acquiring Fund for use in applications for orders, registration statements, proxy materials and other documents which may be necessary in connection with the transactions contemplated hereby and any information necessary to compute the total return of the Acquired Fund shall be accurate and complete and shall comply in all material respects with federal securities and other laws and regulations applicable thereto;
(m) The information included in the proxy statement (the "Proxy Statement") forming part of the Acquiring Fund's Registration Statement on Form N-14 filed in connection with this Agreement (the "Registration Statement") that has been furnished in writing by the Acquired Fund to the Acquiring Fund for inclusion in the Registration Statement, on the effective date of that Registration Statement and on the Closing Date, will conform in all material respects to the applicable requirements of the Securities Act, the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Investment Company Act and the rules and regulations of the Commission thereunder and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading;
(n) Upon the effectiveness of the Registration Statement, no consent, approval, authorization or order of any court or governmental authority is required for the consummation by the AmSouth Trust or the Acquired Fund of the transactions contemplated by this Agreement;
(o) All of the issued and outstanding Acquired Fund Shares have been offered for sale and sold in conformity with all applicable federal and state securities laws, except as may have been previously disclosed in writing to the Acquiring Fund;
(p) The prospectus and statement of additional information of the Acquired Fund and any amendments or supplements thereto, furnished to the Acquiring Fund, did not as of their dates or the dates of their distribution to the public contain any untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances in which such statements were made, not misleading;
(q) The Acquired Fund currently complies in all material respects with, and since its organization has complied in all material respects with, the requirements of, and the rules and regulations under, the Investment Company Act, the Securities Act, the Exchange Act, state "Blue Sky" laws and all other applicable federal and state laws or regulations. The Acquired Fund currently complies in all material respects with, and since its organization has complied in all material respects with, all investment objectives, policies, guidelines and restrictions and any compliance procedures established by the AmSouth Trust with respect to the Acquired Fund. All advertising and sales material used by the Acquired Fund complies in all material respects with and has complied in all material respects with the applicable requirements of the Securities Act, the Investment Company Act, the rules and regulations of the Commission, and, to the extent applicable, the Conduct Rules of the National Association of Securities Dealers, Inc. (the "NASD") and any applicable state regulatory authority. All registration statements, prospectuses, reports, proxy materials or other filings required to be made or filed with the Commission, the NASD or any state securities authorities by the Acquired Fund have been duly filed and have been approved or declared effective, if such approval or declaration of effectiveness is required by law. Such registration statements, prospectuses, reports, proxy materials and other filings under the Securities Act, the Exchange Act and the Investment Company Act (i) are or were in compliance in all material respects with the requirements of all applicable statutes and the rules and regulations thereunder and (ii) do not or did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not false or misleading;
(r) Neither the Acquired Fund nor, to the knowledge of the Acquired Fund,
any "affiliated person" of the Acquired Fund has been convicted of any felony or
misdemeanor, described in Section 9(a)(1) of the Investment Company Act, nor, to
the knowledge of the Acquired Fund, has any affiliated person of the Acquired
Fund been the subject, or presently is the subject, of any proceeding or
investigation with respect to any disqualification that would be a basis for
denial, suspension or revocation of registration as an investment adviser under
Section 203(e) of the Investment Advisers Act of 1940, as amended (the
"Investment Advisers Act"), or Rule 206(4)-4(b) thereunder or of a broker-dealer
under Section 15 of the Exchange Act, or for disqualification as an investment
adviser, employee, officer or director of an investment company under Section 9
of the Investment Company Act; and
(s) The tax representation certificate to be delivered by AmSouth Trust on behalf of the Acquired Fund to the Acquiring Trust and Wilmer Cutler Pickering Hale and Dorr LLP at the Closing pursuant to Paragraph 7.4 (the "Acquired Fund Tax Representation Certificate") will not on the Closing Date contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein not misleading.
4.2 Except as set forth on a disclosure schedule previously provided by the Acquiring Trust to the AmSouth Trust (which disclosure schedule shall be organized by the sections of this Section 4.2 and any disclosure shall only modify the portions of this Section 4.2 expressly identified in such schedule), the Acquiring Trust, on behalf of the Acquiring Fund, represents, warrants and covenants to the Acquired Fund, which representations, warranties and covenants will be true and correct on the date hereof and on the Closing Date as though made on and as of the Closing Date, as follows:
(a) The Acquiring Trust is a statutory trust duly organized, validly existing and in good standing under the laws of the State of Delaware. The Acquiring Trust has the power to own all of its properties and assets and to perform the obligations under this Agreement. The Acquiring Fund is not required to qualify to do business in any jurisdiction in which it is not so qualified or where failure to qualify would subject it to any material liability or disability. Each of the Acquiring Trust and the Acquiring Fund has all necessary federal, state and local authorizations to own all of its properties and assets and to carry on its business as now being conducted;
(b) The Acquiring Trust is a registered investment company classified as a management company of the open-end type, and its registration with the Commission as an investment company under the Investment Company Act is in full force and effect;
(c) The Acquiring Fund's registration statement on Form N-1A that will be in effect on the Closing Date, and the prospectus and statement of additional information of the Acquiring Fund included therein, will conform in all material respects with the applicable requirements of the Securities Act and the Investment Company Act and the rules and regulations of the Commission thereunder, and did not as of the effective date thereof and will not as of the Closing Date contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading;
(d) The Registration Statement, the Proxy Statement and statement of additional information with respect to the Acquiring Fund, and any amendments or supplements thereto in effect on or prior to the Closing Date included in the Registration Statement (other than written information furnished by the Acquired Fund for inclusion therein, as covered by the Acquired Fund's warranty in Paragraph 4.1(m) hereof) will conform in all material respects to the applicable requirements of the Securities Act and the Investment Company Act and the rules and regulations of the Commission thereunder. Neither the Registration Statement nor the Proxy Statement (other than written information furnished by the Acquired Fund for inclusion therein, as covered by the Acquired Fund's warranty in Paragraph 4.1(m) hereof) includes or will include any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading;
(e) The Acquiring Trust is not in violation of, and the execution and delivery of this Agreement and performance of its obligations under this Agreement will not result in a violation of, any provisions of the Declaration of Trust or by-laws of the Acquiring Trust or any material agreement, indenture, instrument, contract, lease or other undertaking with respect to the Acquiring Fund to which the Acquiring Trust is a party or by which the Acquiring Fund or any of its assets is bound;
(f) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or threatened against the Acquiring Fund or any of the Acquiring Fund's properties or assets. The Acquiring Fund knows of no facts which might form the basis for the institution of such proceedings. Neither the Acquiring Trust nor the Acquiring Fund is a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially adversely affects the Acquiring Fund's business or its ability to consummate the transactions contemplated herein;
(g) The statement of assets and liabilities of the Acquiring Fund, and the related statements of income and changes in NAV, as of and for the fiscal year ended [ ] have been audited by Ernst & Young LLP, independent registered public accounting firm, and are in accordance with GAAP consistently applied and fairly reflect, in all material respects, the financial condition of the Acquiring Fund as of such date and the results of its operations for the period then ended, and all known liabilities, whether actual or contingent, of the Acquiring Fund as of the date thereof are disclosed therein;
(h) (A) For each taxable year of its operation since its inception, the Acquiring Fund has met, and for the current taxable year it will meet, the requirements of Subchapter M of the Code for qualification and treatment as a regulated investment company and will qualify as such as of the Closing Date and will satisfy the diversification requirements of Section 851(b)(3) of the Code without regard to the last sentence of Section 851(d) of the Code. The Acquiring Fund has not taken any action, caused any action to be taken or caused any action to fail to be taken which action or failure could cause the Acquiring Fund to fail to qualify as a regulated investment company under the Code;
(B) Within the times and in the manner prescribed by law, the Acquiring Fund has properly filed on a timely basis all Tax Returns that it was required to file, and all such Tax Returns were complete and accurate in all respects. The Acquiring Fund has not been informed by any jurisdiction that the jurisdiction believes that the Acquiring Fund was required to file any Tax Return that was not filed; and the Acquiring Fund does not know of any basis upon which a jurisdiction could assert such a position;
(C) The Acquiring Fund has timely paid, in the manner prescribed by law, all Taxes that were due and payable or that were claimed to be due;
(D) All Tax Returns filed by the Acquiring Fund constitute complete and accurate reports of the respective liabilities for Taxes and all attributes of the Acquiring Fund or, in the case of information returns and payee statements, the amounts required to be reported, and accurately set forth all items required to be included or reflected in such returns;
(E) The Acquiring Fund has not waived or extended any applicable statute of limitations relating to the assessment or collection of Taxes;
(F) The Acquiring Fund has not been notified that any examinations of the Tax Returns of the Acquiring Fund are currently in progress or threatened, and no deficiencies have been asserted or assessed against the Acquiring Fund as a result of any audit by the Internal Revenue Service or any state, local or foreign taxing authority, and, to its knowledge, no such deficiency has been proposed or threatened;
(G) The Acquiring Fund has no actual or potential liability for any Tax obligation of any taxpayer other than itself. The Acquiring Fund is not and has never been a member of a group of corporations with which it has filed (or been required to file) consolidated, combined or unitary Tax Returns. The Acquiring Fund is not a party to any Tax allocation, sharing, or indemnification agreement;
(H) The Acquiring Trust has delivered to AmSouth Trust or made available to AmSouth Trust complete and accurate copies of all Tax Returns of the Acquiring Fund, together with all related examination reports and statements of deficiency for all periods not closed under the applicable statutes of limitations and complete and correct copies of all private letter rulings, revenue agent reports, information document requests, notices of proposed deficiencies, deficiency notices, protests, petitions, closing agreements, settlement agreements, pending ruling requests and any similar documents submitted by, received by or agreed to by or on behalf of the Acquiring Fund. The Acquiring Fund has disclosed on its federal income Tax Returns all positions taken therein that could give rise to a substantial understatement of federal income Tax within the meaning of Section 6662 of the Code;
(I) The Acquiring Fund has not undergone, has not agreed to undergo,
and is not required to undergo (nor will it be required as a result of the
transactions contemplated in this Agreement to undergo) a change in its method
of accounting resulting in an adjustment to its taxable income pursuant to
Section 481 of the Code. The Acquiring Fund will not be required to include any
item of income in, or exclude any item of deduction from, taxable income for any
taxable period (or portion thereof) ending after the Closing Date as a result of
any (i) change in method of accounting for a taxable period ending on or prior
to the Closing Date under Section 481(c) of the Code (or any corresponding or
similar provision of state, local or foreign income Tax law); (ii) "closing
agreement" as described in Section 7121 of the Code (or any corresponding or
similar provision of state, local or foreign income Tax law) executed on or
prior to the Closing Date; (iii) installment sale or open transaction
disposition made on or prior to the Closing Date; or (iv) prepaid amount
received on or prior to the Closing Date;
(J) The Acquiring Fund has not taken or agreed to take any action, and is not aware of any agreement, plan or other circumstance, that is inconsistent with the representations set forth in Annex A;
(K) The Acquiring Fund has not incurred (or been allocated) an "overall foreign loss" as defined in Section 904(f)(2) of the Code which has not been previously recaptured in full as provided in Sections 904(f)(2) and/or 904(f)(3) of the Code;
(L) The Acquiring Fund is not a party to a gain recognition agreement under Section 367 of the Code;
(M) The Acquiring Fund's Tax attributes are not limited under the Code (including but not limited to any capital loss carry forward limitations under Sections 382 or 383 of the Code and the Treasury Regulations thereunder) or comparable provisions of state law, except as set forth on Schedule 4.2;
(i) The authorized capital of the Acquiring Fund consists of an unlimited number of shares of beneficial interest, no par value per share. As of the Closing Date, the Acquiring Fund will be authorized to issue
an unlimited number of shares of beneficial interest, no par value per share. The Acquiring Fund Shares to be issued and delivered to the Acquired Fund for the account of the Acquired Fund Shareholders pursuant to the terms of this Agreement will have been duly authorized on the Closing Date and, when so issued and delivered, will be duly and validly issued, fully paid and non-assessable. The Acquiring Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any Acquiring Fund shares, nor is there outstanding any security convertible into any Acquiring Fund shares;
(j) The Acquiring Trust has the trust power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement have been duly authorized by all necessary action on the part of the Acquiring Trust's Board of Trustees, and, assuming due authorization, execution and delivery by the Acquired Fund, this Agreement will constitute a valid and binding obligation of the Acquiring Fund, enforceable in accordance with its terms, subject as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and other laws relating to or affecting creditors' rights and to general equity principles;
(k) The information to be furnished in writing by the Acquiring Fund or the Acquiring Fund Adviser for use in applications for orders, registration statements, proxy materials and other documents which may be necessary in connection with the transactions contemplated hereby shall be accurate and complete in all material respects and shall comply in all material respects with federal securities and other laws and regulations applicable thereto or the requirements of any form for which its use is intended, and shall not contain any untrue statement of a material fact or omit to state a material fact necessary to make the information provided not misleading;
(l) No consent, approval, authorization or order of or filing with any court or governmental authority is required for the execution of this Agreement or the consummation of the transactions contemplated by the Agreement by the Acquiring Fund, except for the registration of the Acquiring Fund Shares under the Securities Act and the Investment Company Act;
(m) Neither the Acquiring Fund nor, to the knowledge of the Acquiring Fund, any "affiliated person" of the Acquiring Fund has been convicted of any felony or misdemeanor, described in Section 9(a)(1) of the Investment Company Act, nor, to the knowledge of the Acquiring Fund, has any affiliated person of the Acquiring Fund been the subject, or presently is the subject, of any proceeding or investigation with respect to any disqualification that would be a basis for denial, suspension or revocation of registration as an investment adviser under Section 203(e) of the Investment Advisers Act or Rule 206(4)-4(b) thereunder or of a broker-dealer under Section 15 of the Exchange Act, or for disqualification as an investment adviser, employee, officer or director of an investment company under Section 9 of the Investment Company Act; and
(n) Since the most recent fiscal year end, except as specifically disclosed in the Acquiring Fund's prospectus, its statement of additional information as in effect on the date of this Agreement, or its semi-annual report for the period ended January 31, 2005, there has not been any material adverse change in the Acquiring Fund's financial condition, assets, liabilities, business or prospects, or any incurrence by the Acquiring Fund of indebtedness, except for normal contractual obligations incurred in the ordinary course of business or in connection with the settlement of purchases and sales of portfolio securities. For the purposes of this subparagraph (n) (but not for any other purpose of this Agreement), a decline in NAV per Acquiring Fund Share arising out of its normal investment operations or a decline in market values of securities in the Acquiring Fund's portfolio or a decline in net assets of the Acquiring Fund as a result of redemptions shall not constitute a material adverse change;
(o) The tax representation certificate to be delivered by the Acquiring Trust on behalf of the Acquiring Fund to the AmSouth Trust and Wilmer Cutler Pickering Hale and Dorr LLP at Closing pursuant to Section 6.3 (the "Acquiring Fund Tax Representation Certificate") will not on the Closing Date contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein not misleading.
5. COVENANTS OF THE FUNDS
5.1 The Acquired Fund will operate the Acquired Fund's business in the ordinary course of business between the date hereof and the Closing Date. It is understood that such ordinary course of business will include the
declaration and payment of customary dividends and other distributions and any other dividends and other distributions necessary or advisable (except to the extent dividends or other distributions that are not customary may be limited by representations made in connection with the issuance of the tax opinion described in Paragraph 8.5 hereof), in each case payable either in cash or in additional shares.
5.2 The AmSouth Trust will call a special meeting of the Acquired Fund's shareholders to consider approval of this Agreement and act upon the matters set forth in the Proxy Statement.
5.3 The Acquiring Fund will prepare the notice of meeting, form of proxy and Proxy Statement (collectively, "Proxy Materials") to be used in connection with such meeting, and will promptly prepare and file with the Commission the Registration Statement. The AmSouth Trust will provide the Acquiring Fund with information reasonably requested for the preparation of the Registration Statement in compliance with the Securities Act, the Exchange Act, and the Investment Company Act.
5.4 The Acquired Fund covenants that the Acquiring Fund Shares to be issued hereunder are not being acquired by the Acquired Fund for the purpose of making any distribution thereof other than in accordance with the terms of this Agreement.
5.5 The Acquired Fund will assist the Acquiring Fund in obtaining such information as the Acquiring Fund reasonably requires concerning the beneficial ownership of the Acquired Fund Shares.
5.6 Subject to the provisions of this Agreement, each Fund will take, or cause to be taken, all actions, and do or cause to be done, all things reasonably necessary, proper or advisable to consummate the transactions contemplated by this Agreement.
5.7 The Acquired Fund shall furnish to the Acquiring Fund on the Closing Date a Statement of Assets and Liabilities of the Acquired Fund as of the Closing Date setting forth the NAV (as computed pursuant to Paragraph 2.1) of the Acquired Fund as of the Valuation Time, which statement shall be prepared in accordance with GAAP consistently applied and certified by the AmSouth Trust's Treasurer or Assistant Treasurer. As promptly as practicable, but in any case within 30 days after the Closing Date, the AmSouth Trust shall furnish to the Acquiring Trust, in such form as is reasonably satisfactory to the Acquiring Trust, a statement of the earnings and profits of the Acquired Fund for federal income tax purposes, and of any capital loss carryovers and other items that will be carried over to the Acquiring Fund under the Code, and which statement will be certified by the Treasurer of the AmSouth Trust.
5.8 Neither Fund shall take any action that is inconsistent with the representations set forth in, with respect to the Acquired Fund, the Acquired Fund Tax Representation Certificate and, with respect to the Acquiring Fund, the Acquiring Fund Tax Representation Certificate.
5.9 From and after the date of this Agreement and until the Closing Date,
each of the Funds and the AmSouth Trust and the Acquiring Trust shall use its
commercially reasonable efforts to cause the Reorganization to qualify, and will
not knowingly take any action, cause any action to be taken, fail to take any
action or cause any action to fail to be taken, which action or failure to act
could prevent the Reorganization from qualifying, as a reorganization under the
provisions of Section 368(a) of the Code. The parties hereby adopt this
Agreement as a "plan of reorganization" within the meaning of Sections
1.368-2(g) and 1.368-3(a) of the income tax regulations promulgated under the
Code. Unless otherwise required pursuant to a "determination" within the meaning
of Section 1313(a) of the Code, the parties hereto shall treat and report the
transactions contemplated hereby as a reorganization within the meaning of
Section [368(a)(1)(C)/(D)] of the Code and shall not take any position
inconsistent with such treatment.
5.10 From and after the date of this Agreement and through the time of the Closing, each Fund shall use its commercially reasonable efforts to cause it to qualify, and will not knowingly take any action, cause any action to be taken, fail to take any action or cause any action to fail to be taken, which action or failure to act could prevent it from qualifying as a regulated investment company under the provisions of Subchapter M of the Code.
5.11 Each Fund shall prepare, or cause to be prepared, all of its Tax Returns for taxable periods that end on or before the Closing Date and shall timely file, or cause to be timely filed, all such Tax Returns. Each Fund shall make any payments of Taxes required to be made by it with respect to any such Tax Returns.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND
The obligations of the Acquired Fund to complete the transactions provided for herein shall be, at its election, subject to the performance by the Acquiring Fund of all the obligations to be performed by it hereunder on or before the Closing Date, and, in addition thereto, the following further conditions, unless waived by the Acquired Fund in writing:
6.1 All representations and warranties by the Acquiring Trust on behalf of the Acquiring Fund contained in this Agreement shall be true and correct as of the date hereof and, except as they may be affected by the transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date;
6.2 The Acquiring Trust shall have delivered to the AmSouth Trust on the Closing Date a certificate of the Acquiring Trust on behalf of the Acquiring Fund executed in its name by its President or Vice President and its Treasurer or Assistant Treasurer, in form and substance satisfactory to the AmSouth Trust and dated as of the Closing Date, to the effect that the representations and warranties of the Acquiring Trust made in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, that each of the conditions to Closing in this Article 6 have been met, and as to such other matters as the AmSouth Trust shall reasonably request;
6.3 The Acquiring Trust on behalf of the Acquiring Fund shall have delivered to the AmSouth Trust and Wilmer Cutler Pickering Hale and Dorr LLP an Acquiring Fund Tax Representation Certificate, satisfactory to the AmSouth Trust and Wilmer Cutler Pickering Hale and Dorr LLP, substantially in the form attached to this Agreement as Annex A, concerning certain tax-related matters with respect to the Acquiring Fund;
6.4 With respect to the Acquiring Fund, the Board of Trustees of the Acquiring Trust shall have determined that the Reorganization is in the best interests of the Acquiring Fund and, based upon such determination, shall have approved this Agreement and the transactions contemplated hereby; and
6.5 The AmSouth Trust shall have received at the Closing a favorable opinion as to the due authorization of this Agreement by the Acquiring Trust and related matters of Wilmer Cutler Pickering Hale and Dorr LLP, dated as of the Closing Date, in a form reasonably satisfactory to the AmSouth Trust.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND
The obligations of the Acquiring Fund to complete the transactions provided for herein shall be, at its election, subject to the performance by the Acquired Fund of all the obligations to be performed by it hereunder on or before the Closing Date and, in addition thereto, the following further conditions, unless waived by the Acquiring Fund in writing:
7.1 All representations and warranties of the AmSouth Trust on behalf of the Acquired Fund contained in this Agreement shall be true and correct as of the date hereof and, except as they may be affected by the transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date;
7.2 The AmSouth Trust shall have delivered to the Acquiring Fund the Statement of Assets and Liabilities of the Acquired Fund pursuant to Paragraph 5.7, together with a list of its portfolio securities showing the federal income tax bases and holding periods of such securities, as of the Closing Date, certified by the AmSouth Trust's Treasurer or Assistant Treasurer;
7.3 The AmSouth Trust shall have delivered to the Acquiring Trust on the Closing Date a certificate of the AmSouth Trust on behalf of the Acquired Fund executed in its name by its President or Vice President and a Treasurer or Assistant Treasurer, in form and substance reasonably satisfactory to the Acquiring Trust and dated as of the Closing Date, to the effect that the representations and warranties of the AmSouth Trust contained in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, that each of the conditions to Closing in this Article 7 have been met, and as to such other matters as the Acquiring Trust shall reasonably request;
7.4 The AmSouth Trust on behalf of the Acquired Fund shall have delivered to the Acquiring Trust and Wilmer Cutler Pickering Hale and Dorr LLP an Acquired Fund Tax Representation Certificate, satisfactory to the Acquiring Trust and Wilmer Cutler Pickering Hale and Dorr LLP, substantially in the form attached to this Agreement as Annex B, concerning certain tax-related matters with respect to the Acquired Fund;
7.5 The Acquiring Trust shall have received at the Closing a favorable opinion as to the due authorization of this Agreement by the AmSouth Trust and related matters of Kirkpatrick & Lockhart Nicholson Graham LLP, dated as of the Closing Date, in a form reasonably satisfactory to the Acquiring Trust; and
7.6 With respect to the Acquired Fund, the Board of Trustees of the AmSouth Trust shall have determined that the Reorganization is in the best interests of the Acquired Fund and, based upon such determination, shall have approved this Agreement and the transactions contemplated hereby.
8. FURTHER CONDITIONS PRECEDENT
If any of the conditions set forth below does not exist on or before the Closing Date with respect to either party hereto, the other party to this Agreement shall, at its option, not be required to consummate the transactions contemplated by this Agreement:
8.1 This Agreement and the transactions contemplated herein shall have been approved by the requisite vote of the Acquired Fund's shareholders in accordance with the provisions of the AmSouth Trust's Trust Instrument and By-Laws, and certified copies of the resolutions evidencing such approval by the Acquired Fund's shareholders shall have been delivered by the Acquired Fund to the Acquiring Fund. Notwithstanding anything herein to the contrary, neither party hereto may waive the conditions set forth in this Paragraph 8.1;
8.2 On the Closing Date, no action, suit or other proceeding shall be pending before any court or governmental agency in which it is sought to restrain or prohibit, or obtain damages or other relief in connection with, this Agreement or the transactions contemplated herein;
8.3 All consents of other parties and all other consents, orders and permits of federal, state and local regulatory authorities (including those of the Commission and of state Blue Sky and securities authorities) deemed necessary by either party hereto to permit consummation, in all material respects, of the transactions contemplated hereby shall have been obtained, except where failure to obtain any such consent, order or permit would not involve a risk of a material adverse effect on the assets or properties of either party hereto, provided that either party may waive any such conditions for itself;
8.4 The Acquiring Trust's Registration Statement on Form N-14 shall have become effective under the Securities Act and no stop orders suspending the effectiveness of such Registration Statement shall have been issued and, to the best knowledge of the parties hereto, no investigation or proceeding for that purpose shall have been instituted or be pending, threatened or contemplated under the Securities Act;
8.5 The parties shall have received an opinion of Wilmer Cutler Pickering Hale and Dorr LLP, satisfactory to the AmSouth Trust and the Acquiring Trust and subject to customary assumptions and qualifications, substantially to the effect that for federal income tax purposes the acquisition by the Acquiring Fund of the Acquired Assets solely in exchange for the issuance of Acquiring Fund Shares to the Acquired Fund and the assumption of the Assumed Liabilities by the Acquiring Fund, followed by the distribution by the Acquired Fund, in liquidation of the Acquired Fund, of Acquiring Fund Shares to the Acquired Fund Shareholders in exchange for their Acquired Fund
Shares and the termination of the Acquired Fund, will constitute a "reorganization" within the meaning of Section 368(a) of the Code; and
8.6 The Acquired Fund shall have distributed to its shareholders, in a
distribution or distributions qualifying for the deduction for dividends paid
under Section 561 of the Code, all of its investment company taxable income (as
defined in Section 852(b)(2) of the Code determined without regard to Section
852(b)(2)(D) of the Code) for its taxable year ending on the Closing Date, all
of the excess of (i) its interest income excludable from gross income under
Section 103(a) of the Code over (ii) its deductions disallowed under Sections
265 and 171(a)(2) of the Code for its taxable year ending on the Closing Date,
and all of its net capital gain (as such term is used in Sections 852(b)(3)(A)
and (C) of the Code), after reduction by any available capital loss
carryforward, for its taxable year ending on the Closing Date.
9. BROKERAGE FEES AND EXPENSES
9.1 Each party hereto represents and warrants to the other party hereto that there are no brokers or finders entitled to receive any payments in connection with the transactions provided for herein.
9.2 The parties have been informed by AmSouth Asset Management Inc. ("AAMI") and the Acquiring Fund Adviser -- and the parties have entered into this Agreement in reliance on such information -- that such non-parties will pay (with each of AAMI and the Acquiring Fund Adviser being responsible for 50% of such amounts) all proxy statement and solicitation costs of the Funds associated with the Reorganization including, but not limited to, the expenses associated with the preparation, printing and mailing of any and all shareholder notices, communications, proxy statements, and necessary filings with the SEC or any other governmental authority in connection with the transactions contemplated by this Agreement and the fees and expenses of any proxy solicitation firm retained in connection with the Reorganization. Except for the foregoing, the AAMI shall bear the expenses of the Acquired Fund in connection with the transactions contemplated by this Agreement.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
10.1 The Acquiring Trust and the AmSouth Trust each agrees that neither party has made any representation, warranty or covenant not set forth herein or referred to in Paragraphs 4.1 or 4.2 hereof and that this Agreement constitutes the entire agreement between the parties.
10.2 The representations and warranties contained in this Agreement or in any document delivered pursuant hereto or in connection herewith shall not survive the consummation of the transactions contemplated hereunder.
11. TERMINATION
11.1 This Agreement may be terminated by the mutual agreement of the Acquiring Trust and the AmSouth Trust. In addition, either party may at its option terminate this Agreement at or prior to the Closing Date:
(a) because of a material breach by the other of any representation, warranty, covenant or agreement contained herein to be performed at or prior to the Closing Date;
(b) because of a condition herein expressed to be precedent to the obligations of the terminating party which has not been met and which reasonably appears will not or cannot be met;
(c) by resolution of the Acquiring Trust's Board of Trustees if circumstances should develop that, in the good faith opinion of such Board, make proceeding with the Agreement not in the best interests of the Acquiring Fund's shareholders;
(d) by resolution of the AmSouth Trust's Board of Trustees if circumstances should develop that, in the good faith opinion of such Board, make proceeding with the Agreement not in the best interests of the Acquired Fund's shareholders; or
(e) if the transactions contemplated by this Agreement shall not have occurred on or prior to December 31, 2005 or such other date as the parties may mutually agree upon in writing.
11.2 In the event of any such termination, there shall be no liability for damages on the part of the Acquiring Fund, the Acquiring Trust, the AmSouth Trust or the Acquired Fund, or the trustees or officers of the AmSouth Trust, or the Acquiring Trust, but, subject to Paragraph 9.2, each party shall bear the expenses incurred by it incidental to the preparation and carrying out of this Agreement.
12. AMENDMENTS
This Agreement may be amended, modified or supplemented in such manner as may be mutually agreed upon in writing by the authorized officers of the AmSouth Trust and the Acquiring Trust; provided, however, that following the meeting of the Acquired Fund's shareholders called by the AmSouth Trust pursuant to Paragraph 5.2 of this Agreement, no such amendment may have the effect of changing the provisions regarding the method for determining the number of Acquiring Fund Shares to be received by the Acquired Fund Shareholders under this Agreement to their detriment without their further approval; provided that nothing contained in this Section 12 shall be construed to prohibit the parties from amending this Agreement to change the Closing Date.
13. NOTICES
Any notice, report, statement or demand required or permitted by any provisions of this Agreement shall be in writing and shall be given by prepaid telegraph, telecopy or certified mail addressed to the Acquired Fund, c/o AmSouth Asset Management Inc., 3435 Stelzer Road, Columbus, Ohio 43219, Attention: [ ], with copies to Kirkpatrick & Lockhart Nicholson Graham LLP, 1800 Massachusetts Avenue, N.W., Washington, DC, 20036-1221, Attention: Clifford J. Alexander, and to the Acquiring Fund, c/o Pioneer Investment Management, Inc., 60 State Street, Boston, Massachusetts 02109, Attention: Dorothy E. Bourassa, Esq., with copies to Wilmer Cutler Pickering Hale and Dorr LLP, 60 State Street, Boston, Massachusetts 02109, Attention: David C. Phelan.
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
14.1 The article and paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
14.2 This Agreement may be executed in any number of counterparts, each of which shall be deemed an original.
14.3 This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to conflict of laws principles (other than Delaware Code Title 6 ss. 2708); provided that, in the case of any conflict between those laws and the federal securities laws, the latter shall govern.
14.4 This Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns, but no assignment or transfer hereof or of any rights or obligations hereunder shall be made by either party without the prior written consent of the other party hereto. Nothing herein expressed or implied is intended or shall be construed to confer upon or give any person, firm or corporation, or other entity, other than the parties hereto and their respective successors and assigns, any rights or remedies under or by reason of this Agreement.
14.5 It is expressly agreed that the obligations of the Acquiring Trust and the AmSouth Trust shall not be binding upon any of their respective trustees, shareholders, nominees, officers, agents or employees personally, but bind only to the property of the Acquiring Fund or the Acquired Fund, as the case may be, as provided in the trust instruments of the Acquiring Trust and the Instrument of Trust of the AmSouth Trust, respectively. The execution and delivery of this Agreement have been authorized by the trustees of the Acquiring Trust and of the AmSouth Trust and this Agreement has been executed by authorized officers of the Acquiring Trust and the AmSouth Trust, acting as such, and neither such authorization by such trustees nor such execution and delivery by such officers shall be deemed to have been made by any of
them individually or to imposed any liability on any of them personally, but shall bind only the property of the Acquiring Fund and the Acquired Fund, as the case may be, as provided in the trust instruments of the Acquiring Trust and the Instrument of Trust of the AmSouth Trust, respectively.
* * * * *
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of the date first set forth above by its President or Vice President and attested by its Secretary or Assistant Secretary.
Attest: AMSOUTH FUNDS
on behalf of AMSOUTH [ ] FUND
By: ____________________________ By: _______________________________
Name: Name:
Title: [Assistant] Secretary Title: [Vice] President
Attest: PIONEER [ ] FUND
on behalf of PIONEER [ ] FUND
By: ____________________________ By: _______________________________
Name: Christopher J. Kelley Name: Osbert M. Hood
Title: Assistant Secretary Title: Executive Vice President
|
Annex A
TAX REPRESENTATION CERTIFICATE OF
PIONEER [ ] FUND
ON BEHALF OF PIONEER [ ] FUND
This certificate is being delivered in connection with the transactions to be
effected pursuant to the Agreement and Plan of Reorganization made as of [ ],
2005 between Pioneer [ ] Fund, a Delaware statutory trust ("Acquiring Trust"),
on behalf of its sole series Pioneer [ ] Fund ("Acquiring Fund"), and AmSouth
Funds, a Massachusetts business trust, on behalf of its series AmSouth [ ] Fund
("Acquired Fund") (the "Agreement"). Pursuant to the Agreement, Acquiring Fund
will acquire all of the assets of Acquired Fund in exchange solely for (i) the
assumption by Acquiring Fund of the Assumed Liabilities of Acquired Fund and
(ii) the issuance of shares of beneficial interest of Acquiring Fund (the
"Acquiring Fund Shares") to Acquired Fund, followed by the distribution by
Acquired Fund, in liquidation of Acquired Fund, of the Acquiring Fund Shares to
the shareholders of Acquired Fund and the termination of Acquired Fund (the
foregoing together constituting the "transaction").
The undersigned officer of Acquiring Trust, after consulting with its counsel, auditors and tax advisers regarding the meaning of and factual support for the following representations on behalf of Acquiring Fund, hereby certifies and represents that the following statements are true, complete and correct and will be true, complete and correct on the date of the transaction and thereafter as relevant. Unless otherwise indicated, all capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement.
1. Acquiring Fund is a series of Acquiring Trust, a statutory trust organized under the laws of the State of Delaware, and Acquiring Fund is, and has been at all times, treated as a corporation for federal tax purposes.
2. Neither Acquiring Fund nor any person "related" to Acquiring Fund (as defined in Treasury Regulation Section 1.368-1(e)(3)), nor any partnership of which Acquiring Fund or any such related person is a partner, has any plan or intention to redeem or otherwise acquire any of the Acquiring Fund Shares received by shareholders of Acquired Fund in the transaction except in the ordinary course of Acquiring Fund's business in connection with its legal obligation under Section 22(e) of the Investment Company Act of 1940, as amended (the "1940 Act"), as a series of a registered open-end investment company to redeem its own shares.
3. After the transaction, Acquiring Fund will continue the historic business (as defined in Treasury Regulation Section 1.368-1(d)(2)) of Acquired Fund or will use a significant portion of the historic business assets (as defined in Treasury Regulation Section 1.368-1(d)(3)) acquired from Acquired Fund in a business.
4. Acquiring Fund has no plan or intention to sell or otherwise dispose of any assets of Acquired Fund acquired in the transaction, except for dispositions made in the ordinary course of its business or to maintain its qualification as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code").
5. Any expenses of Acquired Fund incurred in connection with the transaction which are paid or assumed by Acquiring Fund will be expenses of Acquired Fund solely and directly related to the transaction in accordance with Rev. Rul. 73-54, 1973-1 C.B. 187. Acquiring Fund will not pay or assume the expenses, if any, incurred by any Acquired Fund Shareholders in connection with the transaction.
6. There is no, and never has been any, indebtedness between Acquiring Fund and Acquired Fund.
7. Acquiring Fund has properly elected to be a regulated investment company under Subchapter M of the Code, has qualified for the special tax treatment afforded regulated investment companies under the Code for each taxable year since inception and qualifies for such treatment as of the time of the Closing.
8. Acquiring Fund meets the requirements of an "investment company" in
Section 368(a)(2)(F) of the Code.
9. Acquiring Fund is not under the jurisdiction of a court in a Title 11 or similar case within the meaning of Section 368(a)(3)(A) of the Code.
10. Acquiring Fund does not now own and has never owned, directly or indirectly, any shares of Acquired Fund.
11. As of the date of the transaction, the fair market value of the Acquiring Fund Shares issued to Acquired Fund will be approximately equal to the fair market value of the Acquired Assets minus the Assumed Liabilities. Acquiring Fund will not furnish any consideration in connection with the acquisition of the Acquired Assets other than the assumption of the Assumed Liabilities and the issuance of such Acquiring Fund Shares.
12. Acquired Fund Shareholders will [not] be in control (within the meaning of Sections 368(a)(2)(H)(i) and 304(c)(1) of the Code) of Acquiring Fund after the transaction.
13. The transaction is being undertaken for valid and substantial business purposes, including facilitating Acquired Fund's becoming a member of the Pioneer family of mutual funds, which, in the long term, is intended to result in lower expenses and increased assets.
14. No Acquired Fund shareholder is acting as agent for Acquiring Fund in connection with the transaction or approval thereof. Acquiring Fund will not reimburse any Acquired Fund shareholder for Acquired Fund Shares such shareholder may have purchased or for other obligations such shareholder may have incurred.
15. Acquiring Fund has no outstanding warrants, options, convertible securities or any other type of right pursuant to which any person could acquire stock in Acquiring Fund.
* * * * *
The undersigned officer of Acquiring Trust is authorized to make all of the representations set forth herein, and the undersigned is authorized to execute this certificate on behalf of Acquiring Fund. The undersigned recognizes that Wilmer Cutler Pickering Hale and Dorr LLP will rely upon the foregoing representations in evaluating the United States federal income tax consequences of the transaction and rendering its opinion pursuant to Section 8.5 of the Agreement. If, prior to the date of the transaction, any of the representations set forth herein ceases to be accurate, the undersigned agrees to deliver immediately to Wilmer Cutler Pickering Hale and Dorr LLP a written notice to that effect.
PIONEER [ ] FUND
on behalf of PIONEER [ ] FUND
By: _______________________________
Name: _______________________________
Title: _______________________________
Dated: _________, 2005
Annex B
TAX REPRESENTATION CERTIFICATE OF
AMSOUTH FUNDS
ON BEHALF OF AMSOUTH [ ] FUND
This certificate is being delivered in connection with the transactions to be
effected pursuant to the Agreement and Plan of Reorganization made as of [ ],
2005 between Pioneer [ ] Fund, a Delaware statutory trust, on behalf of its
series Pioneer [ ] Fund ("Acquiring Fund"), and AmSouth Funds, a Massachusetts
business trust ("AmSouth Trust"), on behalf of its series AmSouth [ ] Fund
("Acquired Fund") (the "Agreement"). Pursuant to the Agreement, Acquiring Fund
will acquire all of the assets of Acquired Fund in exchange solely for (i) the
assumption by Acquiring Fund of the Assumed Liabilities of Acquired Fund and
(ii) the issuance of shares of beneficial interest of Acquiring Fund (the
"Acquiring Fund Shares") to Acquired Fund, followed by the distribution by
Acquired Fund, in liquidation of Acquired Fund, of the Acquiring Fund Shares to
the shareholders of Acquired Fund and the termination of Acquired Fund (the
foregoing together constituting the "transaction").
The undersigned officer of AmSouth Trust, after consulting with its counsel, auditors and tax advisers regarding the meaning of and factual support for the following representations, on behalf of Acquired Fund, hereby certifies and represents that the following statements are true, complete and correct and will be true, complete and correct on the date of the transaction and thereafter as relevant. Unless otherwise indicated, all capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement.
1. Acquired Fund is a series of AmSouth Funds, a business trust organized under the laws of the Commonwealth of Massachusetts, and Acquired Fund is, and has been at all times, treated as a separate corporation for federal tax purposes.
2. As of the date of the transaction, the fair market value of the Acquiring Fund Shares received by each shareholder that holds shares of Acquired Fund (the "Acquired Fund Shares") will be approximately equal to the fair market value of the Acquired Fund Shares with respect to which such Acquiring Fund Shares are received, and the aggregate consideration received by Acquired Fund shareholders in exchange for their Acquired Fund Shares will be approximately equal to the fair market value of all of the outstanding Acquired Fund Shares immediately prior to the transaction. No property other than Acquiring Fund Shares will be distributed to shareholders of Acquired Fund in exchange for their Acquired Fund Shares, nor will any such shareholder receive cash or other property as part of the transaction.
3. Neither Acquired Fund nor any person "related" to Acquired Fund (as
defined in Treasury Regulation Section 1.368-1(e)(3)), nor any partnership in
which Acquired Fund or any such related person is a partner, has redeemed,
acquired or otherwise made any distributions with respect to any shares of
Acquired Fund as part of the transaction, or otherwise pursuant to a plan of
which the transaction is a part, other than redemptions and distributions made
in the ordinary course of Acquired Fund's business as a series of an open-end
investment company. To the best knowledge of management of Acquired Fund, there
is no plan or intention on the part of the shareholders of Acquired Fund to
engage in any transaction with Acquired Fund, Acquiring Fund, or any person
treated as related to Acquired Fund or Acquiring Fund under Treasury Regulation
Section 1.368-1(e)(3) or any partnership in which Acquired Fund, Acquiring Fund,
or any person treated as related to Acquired Fund or Acquiring Fund under
Treasury Regulation Section 1.368-1(e)(3) is a partner involving the sale,
redemption or exchange of any of the Acquired Fund Shares or any of the
Acquiring Fund Shares to be received in the transaction, as the case may be,
other than in the ordinary course of Acquired Fund's business as a series of an
open-end investment company.
4. Pursuant to the transaction, Acquired Fund will transfer to Acquiring
Fund, and Acquiring Fund will acquire, at least 90% of the fair market value of
the net assets, and at least 70% of the fair market value of the gross assets,
Acquired Fund held immediately before the transaction. For the purposes of the
foregoing, any amounts Acquired Fund uses to pay its transaction expenses and to
make redemptions and distributions immediately before the transaction (except
(a) redemptions in the ordinary course of its business required by section 22(e)
of the
Investment Company Act and (b) regular, normal dividend distributions made to conform to its policy of distributing all or substantially all of its income and gains to avoid the obligation to pay federal income tax and/or the excise tax under Section 4982 of the Code) will be included as assets it held immediately before the transaction.
5. As of the date of the transaction, the fair market value of the Acquiring Fund Shares issued to Acquired Fund will be approximately equal to the fair market value of the Acquired Assets minus the Assumed Liabilities. Acquired Fund will not receive any consideration from Acquiring Fund in connection with the acquisition of the Acquired Assets other than the assumption of the Assumed Liabilities and the issuance of such Acquiring Fund Shares.
6. The Assumed Liabilities assumed by Acquiring Fund plus the Assumed Liabilities, if any, to which the transferred assets are subject were incurred by Acquired Fund in the ordinary course of its business. Acquired Fund is not aware of any liabilities of any kind other than the Assumed Liabilities.
7. As of the Closing Date, the adjusted basis and fair market value of the Acquired Assets will equal or exceed the Assumed Liabilities assumed for purposes of Section 357(d) of the Code.
8. Acquired Fund currently conducts its historic business within the meaning of Treasury Regulation Section 1.368-1(d)(2), which provides that, in general, a corporation's historic business is the business it has conducted most recently, but does not include a business that the corporation enters into as part of a plan of reorganization. The Acquired Fund assets transferred to Acquiring Fund will be Acquired Fund's historic business assets within the meaning of Treasury Regulation Section 1.368-1(d)(3), which provides that a corporation's historic business assets are the assets used in its historic business.
9. Acquired Fund will distribute to its shareholders the Acquiring Fund Shares it receives pursuant to the transaction, and its other properties, if any, and will be liquidated promptly thereafter.
10. The expenses of Acquired Fund incurred by it in connection with the transaction will be only such expenses that are solely and directly related to the transaction in accordance with Rev. Rul. 73-54, 1973-1 C.B. 187. Acquired Fund will not pay any expenses incurred by its shareholders in connection with the transaction.
11. There is no, and never has been any, indebtedness between Acquiring Fund and Acquired Fund.
12. Acquired Fund has properly elected to be a regulated investment company under Subchapter M of the Code, has qualified for the special tax treatment afforded regulated investment companies under Subchapter M of the Code for each taxable year since inception, and qualifies for such treatment as of the time of the Closing.
13. Acquired Fund meets the requirements of an "investment company" in
Section 368(a)(2)(F) of the Code.
14. Acquired Fund is not under the jurisdiction of a court in a Title 11 or similar case within the meaning of Section 368(a)(3)(A) of the Code.
15. Acquired Fund does not pay compensation to any shareholder-employee.
16. Acquired Fund shareholders will not have dissenters' or appraisal rights in the transaction.
17. The transaction is being undertaken for valid and substantial business purposes, including facilitating Acquired Fund's becoming a member of the Pioneer family of material funds, which, in the long term, is intended to result in lower expenses and increased assets.
18. Acquired Fund has no outstanding warrants, options, convertible securities or any other type of right pursuant to which any person could acquire stock in Acquired Fund.
* * * * *
The undersigned officer of AmSouth Trust is authorized to make all of the representations set forth herein, and the undersigned is authorized to execute this certificate on behalf of Acquired Fund. The undersigned recognizes that Wilmer Cutler Pickering Hale and Dorr LLP will rely upon the foregoing representations in evaluating the United States federal income tax consequences of the transaction and rendering its opinion pursuant to Section 8.5 of the Agreement. If, prior to the date of the transaction, any of the representations set forth herein ceases to be accurate, the undersigned agrees to deliver immediately to Wilmer Cutler Pickering Hale and Dorr LLP a written notice to that effect.
AMSOUTH FUNDS
on behalf of AMSOUTH [ ] FUND
By: ________________________________
Name: ________________________________
Title: ________________________________
Dated: __________, 2005
Draft
Exhibit A-2--Form of Agreement and Plan of Reorganization (F Reorganization)
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as of the __ day of _________, 2005, by and between Pioneer [ ] Fund, a Delaware statutory trust (the "Acquiring Trust"), on behalf of its series Pioneer [_________] Fund (the "Acquiring Fund"), with its principal place of business at 60 State Street, Boston, Massachusetts 02109, and AmSouth Funds, a Massachusetts business trust (the "AmSouth Trust"), on behalf of its series AmSouth [ ] Fund (the "Acquired Fund"), with its principal place of business at 3435 Stelzer Road, Columbus, Ohio 43219. The Acquiring Fund and the Acquired Fund are sometimes referred to collectively herein as the "Funds" and individually as a "Fund."
This Agreement is intended to be and is adopted as a plan of a "reorganization" as defined in Section 368(a)(1)(F) of the United States Internal Revenue Code of 1986, as amended (the "Code") and the Treasury Regulations thereunder. The reorganization (the "Reorganization") will consist of (1) the transfer of all of the assets of the Acquired Fund to the Acquiring Fund in exchange solely for (A) the issuance of Class A, Class B and Class Y shares of beneficial interest of the Acquiring Fund (collectively, the "Acquiring Fund Shares" and each, an "Acquiring Fund Share") to the Acquired Fund, and (B) the assumption by the Acquiring Fund of all liabilities of the Acquired Fund (collectively, the "Assumed Liabilities"), and (2) the distribution by the Acquired Fund, on or promptly after the closing date of the Reorganization (the "Closing Date") as provided herein, of the Acquiring Fund Shares to the shareholders of the Acquired Fund in liquidation and dissolution of the Acquired Fund, all upon the terms and conditions hereinafter set forth in this Agreement.
WHEREAS, the Acquiring Trust and the AmSouth Trust are each registered investment companies classified as management companies of the open-end type.
WHEREAS, the Acquiring Fund is authorized to issue shares of beneficial interest.
WHEREAS, the Board of Trustees of the AmSouth Trust has determined that the Reorganization is in the best interests of the Acquired Fund shareholders and is not dilutive of the interests of those shareholders.
NOW, THEREFORE, in consideration of the premises of the covenants and agreements hereinafter set forth, the parties hereto covenant and agree as follows:
1. TRANSFER OF ASSETS OF THE ACQUIRED FUND IN EXCHANGE FOR THE ACQUIRING FUND SHARES AND ASSUMPTION OF THE ASSUMED LIABILITIES; LIQUIDATION AND TERMINATION OF THE ACQUIRED FUND.
1.1 Subject to the terms and conditions herein set forth and on the basis of the representations and warranties contained herein, the Acquired Fund will transfer all of its assets as set forth in Paragraph 1.2 (the "Acquired Assets") to the Acquiring Fund free and clear of all liens and encumbrances (other than those arising under the Securities Act of 1933, as amended (the "Securities Act"), liens for taxes not yet due and contractual restrictions on the transfer of the Acquired Assets) and the Acquiring Fund agrees in exchange therefor: (i) to issue to the Acquired Fund the number of Acquiring Fund Shares, including fractional Acquiring Fund Shares, of each class with an aggregate net asset value ("NAV") equal to the NAV of the Acquired Fund attributable to the corresponding class of the Acquired Fund's shares, as determined in the manner set forth in Paragraphs 2.1 and 2.2; and (ii) to assume the Assumed Liabilities. Such transactions shall take place at the Closing (as defined in Paragraph 3.1 below).
1.2 (a) The Acquired Assets shall consist of all of the Acquired Fund's property, including, without limitation, all portfolio securities and instruments, dividends and interest receivables, cash, goodwill, contractual rights and choses in action of the Acquired Fund or the AmSouth Trust in respect of the Acquired Fund, all other intangible property owned by the Acquired Fund, originals or copies of all books and records of the Acquired Fund, and all other assets of the Acquired Fund on the Closing Date. The Acquiring Fund shall also be entitled to receive (or, to the extent agreed upon between the AmSouth Trust and the Acquiring Trust, be provided
access to) copies of all records that the AmSouth Trust is required to maintain under the Investment Company Act of 1940, as amended (the "Investment Company Act"), and the rules of the Securities and Exchange Commission (the "Commission") thereunder to the extent such records pertain to the Acquired Fund.
(b) The Acquired Fund has provided the Acquiring Fund with a list of all of the Acquired Fund's securities and other assets as of the date of execution of this Agreement, and the Acquiring Fund has provided the Acquired Fund with a copy of the current fundamental investment policies and restrictions and fair value procedures applicable to the Acquiring Fund. The Acquired Fund reserves the right to sell any of such securities or other assets before the Closing Date (except to the extent sales may be limited by representations of the Acquired Fund contained herein and made in connection with the issuance of the tax opinion provided for in Paragraph 8.5 hereof).
1.3 The Acquired Fund will endeavor to discharge all of its known liabilities and obligations that are or will become due prior to the Closing.
1.4 On or as soon after the Closing Date as is conveniently practicable (the "Liquidation Date"), the AmSouth Trust shall liquidate the Acquired Fund and distribute pro rata to its shareholders of record, determined as of the close of regular trading on the New York Stock Exchange on the Closing Date (the "Acquired Fund Shareholders"), the Acquiring Fund Shares received by the Acquired Fund pursuant to Paragraph 1.1 hereof. Each Acquired Fund Shareholder shall receive the number of Acquiring Fund Shares of the class corresponding to the class of shares of beneficial interest of the Acquired Fund (the "Acquired Fund Shares") held by such Acquired Fund Shareholder that have an aggregate NAV equal to the aggregate NAV of the Acquired Fund Shares held of record by such Acquired Fund Shareholder on the Closing Date. Such liquidation and distribution will be accomplished by the AmSouth Trust instructing the Acquiring Trust to transfer the Acquiring Fund Shares then credited to the account of the Acquired Fund on the books of the Acquiring Fund to open accounts on the share records of the Acquiring Fund established and maintained by the Acquiring Fund's transfer agent in the names of the Acquired Fund Shareholders and representing the respective pro rata number of the Acquiring Fund Shares due the Acquired Fund Shareholders. The AmSouth Trust shall promptly provide the Acquiring Trust with evidence of such liquidation and distribution. All issued and outstanding Acquired Fund Shares will simultaneously be cancelled on the books of the Acquired Fund, and the Acquired Fund will be dissolved. The Acquiring Fund shall not issue certificates representing the Acquiring Fund Shares in connection with such exchange.
1.5 Ownership of Acquiring Fund Shares will be shown on the books of the Acquiring Fund's transfer agent. Any certificates representing ownership of Acquired Fund Shares that remain outstanding on the Closing Date shall be deemed to be cancelled and shall no longer evidence ownership of Acquired Fund Shares.
1.6 Any transfer taxes payable upon issuance of Acquiring Fund Shares in a name other than the registered holder of the Acquired Fund Shares on the books of the Acquired Fund as of that time shall, as a condition of such issuance and transfer, be paid by the person to whom such Acquiring Fund Shares are to be issued and transferred.
1.7 Any reporting responsibility of the AmSouth Trust with respect to the Acquired Fund for taxable periods ending on or before the Closing Date, including, but not limited to, the responsibility for filing of regulatory reports, Tax Returns (as defined in Paragraph 4.1), or other documents with the Commission, any state securities commissions, and any federal, state or local tax authorities or any other relevant regulatory authority, is and shall remain the responsibility of the AmSouth Trust.
2. VALUATION
2.1 The NAV of the Acquiring Fund Shares and the NAV of the Acquired Fund shall, in each case, be determined as of the close of business (4:00 p.m., Boston time) on the Closing Date (the "Valuation Time"). The NAV of each class of Acquiring Fund Shares shall be equal to the NAV of the corresponding class of the Acquired Fund Shares as of the Valuation Time. The NAV of the Acquired Fund and of each Class A, B and I share thereof shall be computed by ASO Services Company, Inc. (the "Acquired Fund Administrator") by calculating the value of the Acquired Assets and by subtracting therefrom the amount of the liabilities of the Acquired Fund on the Closing Date included on the Statement of Assets and Liabilities of the Acquired Fund delivered pursuant to
Paragraph 5.7 (the "Statement of Assets and Liabilities"), said assets and liabilities to be valued in the manner set forth in the Acquiring Fund's then current prospectus and statement of additional information. Pioneer Investment Management, Inc. (the "Acquiring Fund Adviser") shall confirm to the Acquiring Fund the NAV of the Acquired Fund.
2.2 The number of Acquiring Fund Shares to be issued (including fractional shares, if any) in exchange for the Acquired Assets and the assumption of the Assumed Liabilities shall be determined by Acquiring Fund Adviser by dividing the NAV of the Acquired Fund, as determined in accordance with Paragraph 2.1, by the NAV of each Acquiring Fund Share, as determined in accordance with Paragraph 2.1.
2.3 The Acquired Fund shall cause the Acquired Fund Administrator to deliver a copy of its valuation report to the Acquiring Fund at Closing. All computations of value shall be made by the Acquired Fund Administrator in accordance with its regular practice as pricing agent for the Acquired Fund.
3. CLOSING AND CLOSING DATE
3.1 The Closing Date shall be [ ], 2005, or such later date as the parties may agree to in writing. All acts necessary to consummation the Reorganization (the "Closing") shall be deemed to take place simultaneously as of 5:00 p.m. (Eastern time) on the Closing Date unless otherwise provided. The Closing shall be held at the offices of Wilmer Cutler Pickering Hale and Dorr LLP, 60 State Street, Boston, Massachusetts, or at such other place as the parties may agree.
3.2 Portfolio securities that are held other than in book-entry form in the name of AmSouth Bank (the "Acquired Fund Custodian") as record holder for the Acquired Fund shall be presented by the Acquired Fund to Brown Brothers Harriman & Co. (the "Acquiring Fund Custodian") for examination no later than three business days preceding the Closing Date. Such portfolio securities shall be delivered by the Acquired Fund to the Acquiring Fund Custodian for the account of the Acquiring Fund on the Closing Date, duly endorsed in proper form for transfer, in such condition as to constitute good delivery thereof in accordance with the custom of brokers, and shall be accompanied by all necessary federal and state stock transfer stamps or a check for the appropriate purchase price thereof. Portfolio securities held of record by the Acquired Fund Custodian in book-entry form on behalf of the Acquired Fund shall be delivered by the Acquired Fund Custodian through the Depository Trust Company to the Acquiring Fund Custodian and by the Acquiring Fund Custodian recording the beneficial ownership thereof by the Acquiring Fund on the Acquiring Fund Custodian's records. Any cash shall be delivered by the Acquired Fund Custodian transmitting immediately available funds by wire transfer to the Acquiring Fund Custodian the cash balances maintained by the Acquired Fund Custodian and the Acquiring Fund Custodian crediting such amount to the account of the Acquiring Fund.
3.3 The Acquiring Fund Custodian shall deliver within one business day after the Closing a certificate of an authorized officer stating that: (a) the Acquired Assets have been delivered in proper form to the Acquiring Fund on the Closing Date, and (b) all necessary transfer taxes including all applicable federal and state stock transfer stamps, if any, have been paid, or provision for payment has been made in conjunction with the delivery of portfolio securities as part of the Acquired Assets.
3.4 If on the Closing Date (a) the New York Stock Exchange is closed to trading or trading thereon shall be restricted or (b) trading or the reporting of trading on such exchange or elsewhere is disrupted so that accurate appraisal of the NAV of the Acquired Fund pursuant to Paragraph 2.1 is impracticable, the Closing Date shall be postponed until the first business day after the day when trading shall have been fully resumed and reporting shall have been restored.
3.5 The Acquired Fund shall deliver at the Closing a list of the names, addresses, federal taxpayer identification numbers and backup withholding and nonresident alien withholding status and certificates of the Acquired Fund Shareholders and the number and percentage ownership of outstanding Acquired Fund Shares owned by each Acquired Fund Shareholder as of the Valuation Time, certified by the President or a Secretary of the AmSouth Trust and its Treasurer, Secretary or other authorized officer (the "Shareholder List") as being an accurate record of the information (a) provided by the Acquired Fund Shareholders, (b) provided by the Acquired Fund Custodian, or (c) derived from the AmSouth Trust's records by such officers or one of the AmSouth Trust's
service providers. The Acquiring Fund shall issue and deliver to the Acquired Fund a confirmation evidencing the Acquiring Fund Shares to be credited on the Closing Date, or provide evidence satisfactory to the Acquired Fund that such Acquiring Fund Shares have been credited to the Acquired Fund's account on the books of the Acquiring Fund. At the Closing, each party shall deliver to the other such bills of sale, checks, assignments, stock certificates, receipts or other documents as such other party or its counsel may reasonably request.
4. REPRESENTATIONS AND WARRANTIES
4.1 Except as set forth on a disclosure schedule previously provided by the AmSouth Trust to the Acquiring Trust (which disclosure schedule shall be organized by the sections of this Section 4.1 and any disclosure shall only modify the portions of this Section 4.1 expressly identified in such schedule), the AmSouth Trust, on behalf of the Acquired Fund, represents, warrants and covenants to the Acquiring Fund, which representations, warranties and covenants will be true and correct on the date hereof and on the Closing Date as though made on and as of the Closing Date, as follows:
(a) The Acquired Fund is a series of the AmSouth Trust. The AmSouth Trust is a business trust validly existing and in good standing under the laws of the Commonwealth of Massachusetts and has the power to own all of its properties and assets and, subject to approval by the Acquired Fund's shareholders, to perform its obligations under this Agreement. The Acquired Fund is not required to qualify to do business in any jurisdiction in which it is not so qualified or where failure to qualify would subject it to any material liability or disability. Each of the AmSouth Trust and the Acquired Fund has all necessary federal, state and local authorizations to own all of its properties and assets and to carry on its business as now being conducted;
(b) The AmSouth Trust is a registered investment company classified as a management company of the open-end type, and its registration with the Commission as an investment company under the Investment Company Act is in full force and effect;
(c) The AmSouth Trust is not in violation of, and the execution and delivery of this Agreement and the performance of its obligations under this Agreement in respect of the Acquired Fund will not result in a violation of, any provision of the AmSouth Trust's Trust Instrument or By-Laws or any material agreement, indenture, instrument, contract, lease or other undertaking with respect to the Acquired Fund to which the AmSouth Trust is a party or by which the Acquired Fund or any of its assets are bound;
(d) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or to its knowledge threatened against the Acquired Fund or any of the Acquired Fund's properties or assets. The Acquired Fund knows of no facts which might form the basis for the institution of such proceedings. Neither the AmSouth Trust nor the Acquired Fund is a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially adversely affects the Acquired Fund's business or its ability to consummate the transactions contemplated herein or would be binding upon the Acquiring Fund as the successor to the Acquired Fund;
(e) The Acquired Fund has no material contracts or other commitments (other than this Agreement or agreements for the purchase and sale of securities entered into in the ordinary course of business and consistent with its obligations under this Agreement) which will not be terminated at or prior to the Closing Date and no such termination will result in liability to the Acquired Fund (or the Acquiring Fund);
(f) The statement of assets and liabilities of the Acquired Fund, and the related statements of operations and changes in net assets, as of and for the fiscal year ended July 31, 2004 have been audited by Ernst & Young LLP, independent registered public accounting firm, and are in accordance with generally accepted accounting principles ("GAAP") consistently applied and fairly reflect, in all material respects, the financial condition of the Acquired Fund as of such date and the results of its operations for the period then ended, and all known liabilities, whether actual or contingent, of the Acquired Fund as of the date thereof are disclosed therein. The Statement of Assets and Liabilities will be in accordance with GAAP consistently applied and will fairly reflect, in all material respects, the financial condition of the Acquired Fund as of such date and the results of its operations for the period then ended. Except for the Assumed Liabilities, the Acquired Fund will not have any known or contingent liabilities on the Closing Date. No significant deficiency, material weakness, fraud, significant change or
other factor that could significantly affect the internal controls of the Acquired Fund has been disclosed or is required to be disclosed in the Acquired Fund's reports on Form N-CSR to enable the chief executive officer and chief financial officer or other officers of the Acquired Fund to make the certifications required by the Sarbanes-Oxley Act, and no deficiency, weakness, fraud, change, event or other factor exists that will be required to be disclosed in the Acquiring Fund's Form N-CSR after the Closing Date;
(g) Since the most recent fiscal year end, except as specifically disclosed in the Acquired Fund's prospectus, its statement of additional information as in effect on the date of this Agreement, or its semi-annual report for the period ended January 31, 2005, there has not been any material adverse change in the Acquired Fund's financial condition, assets, liabilities, business or prospects, or any incurrence by the Acquired Fund of indebtedness, except for normal contractual obligations incurred in the ordinary course of business or in connection with the settlement of purchases and sales of portfolio securities. For the purposes of this subparagraph (g) (but not for any other purpose of this Agreement), a decline in NAV per Acquired Fund Share arising out of its normal investment operations or a decline in market values of securities in the Acquired Fund's portfolio or a decline in net assets of the Acquired Fund as a result of redemptions shall not constitute a material adverse change;
(h) (A) For each taxable year of its operation since its inception, the Acquired Fund has met, and for the current taxable year it will meet, the requirements of Subchapter M of the Code for qualification and treatment as a regulated investment company and will qualify as such as of the Closing Date and will satisfy the diversification requirements of Section 851(b)(3) of the Code without regard to the last sentence of Section 851(d) of the Code. The Acquired Fund has not taken any action, caused any action to be taken or caused any action to fail to be taken which action or failure could cause the Acquired Fund to fail to qualify as a regulated investment company under the Code;
(B) Within the times and in the manner prescribed by law, the Acquired Fund has properly filed on a timely basis all Tax Returns (as defined below) that it was required to file, and all such Tax Returns were complete and accurate in all respects. The Acquired Fund has not been informed by any jurisdiction that the jurisdiction believes that the Acquired Fund was required to file any Tax Return that was not filed; and the Acquired Fund does not know of any basis upon which a jurisdiction could assert such a position;
(C) The Acquired Fund has timely paid, in the manner prescribed by law, all Taxes (as defined below), which were due and payable or which were claimed to be due;
(D) All Tax Returns filed by the Acquired Fund constitute complete and accurate reports of the respective Tax liabilities and all attributes of the Acquired Fund or, in the case of information returns and payee statements, the amounts required to be reported, and accurately set forth all items required to be included or reflected in such returns;
(E) The Acquired Fund has not waived or extended any applicable statute of limitations relating to the assessment or collection of Taxes;
(F) The Acquired Fund has not been notified that any examinations of the Tax Returns of the Acquired Fund are currently in progress or threatened, and no deficiencies have been asserted or assessed against the Acquired Fund as a result of any audit by the Internal Revenue Service or any state, local or foreign taxing authority, and, to its knowledge, no such deficiency has been proposed or threatened;
(G) The Acquired Fund has no actual or potential liability for any Tax obligation of any taxpayer other than itself. The Acquired Fund is not and has never been a member of a group of corporations with which it has filed (or been required to file) consolidated, combined or unitary Tax Returns. The Acquired Fund is not a party to any Tax allocation, sharing, or indemnification agreement;
(H) The unpaid Taxes of the Acquired Fund for tax periods through the Closing Date do not exceed the accruals and reserves for Taxes (excluding accruals and reserves for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the Statement of Assets and Liabilities, rather than in any notes thereto (the "Tax Reserves"). All Taxes that the Acquired Fund is or was
required by law to withhold or collect have been duly withheld or collected and, to the extent required, have been timely paid to the proper governmental agency;
(I) The Acquired Fund has delivered to the Acquiring Fund or made available to the Acquiring Fund complete and accurate copies of all Tax Returns of the Acquired Fund, together with all related examination reports and statements of deficiency for all periods not closed under the applicable statutes of limitations and complete and correct copies of all private letter rulings, revenue agent reports, information document requests, notices of proposed deficiencies, deficiency notices, protests, petitions, closing agreements, settlement agreements, pending ruling requests and any similar documents submitted by, received by or agreed to by or on behalf of the Acquired Fund. The Acquired Fund has disclosed on its federal income Tax Returns all positions taken therein that could give rise to a substantial understatement of federal income Tax within the meaning of Section 6662 of the Code;
(J) The Acquired Fund has not undergone, has not agreed to undergo,
and is not required to undergo (nor will it be required as a result of the
transactions contemplated in this Agreement to undergo) a change in its method
of accounting resulting in an adjustment to its taxable income pursuant to
Section 481 of the Code. The Acquired Fund will not be required to include any
item of income in, or exclude any item of deduction from, taxable income for any
taxable period (or portion thereof) ending after the Closing Date as a result of
any (i) change in method of accounting for a taxable period ending on or prior
to the Closing Date under Section 481(c) of the Code (or any corresponding or
similar provision of state, local or foreign income Tax law); (ii) "closing
agreement" as described in Section 7121 of the Code (or any corresponding or
similar provision of state, local or foreign income Tax law) executed on or
prior to the Closing Date; (iii) installment sale or open transaction
disposition made on or prior to the Closing Date; or (iv) prepaid amount
received on or prior to the Closing Date;
(K) The Acquired Fund has not taken or agreed to take any action, and is not aware of any agreement, plan or other circumstance, that is inconsistent with the representations set forth in Annex B;
(L) There are (and as of immediately following the Closing there will be) no liens on the assets of the Acquired Fund relating to or attributable to Taxes, except for Taxes not yet due and payable;
(M) The Tax bases of the assets of the Acquired Fund are accurately reflected on the Acquired Fund's Tax books and records;
(N) The Acquired Fund has not incurred (or been allocated) an "overall foreign loss" as defined in Section 904(f)(2) of the Code which has not been previously recaptured in full as provided in Sections 904(f)(2) and/or 904(f)(3) of the Code;
(O) The Acquired Fund is not a party to a gain recognition agreement under Section 367 of the Code;
(P) The Acquired Fund does not own any interest in an entity that is characterized as a partnership for income tax purposes;
(Q) The Acquired Fund's Tax attributes are not limited under the Code (including but not limited to any capital loss carry forward limitations under Sections 382 or 383 of the Code and the Treasury Regulations thereunder) or comparable provisions of state law; and
(R) For purposes of this Agreement, "Taxes" or "Tax" shall mean all taxes, charges, fees, levies or other similar assessments or liabilities, including without limitation income, gross receipts, ad valorem, premium, value-added, excise, real property, personal property, sales, use, transfer, withholding, employment, unemployment, insurance, social security, business license, business organization, environmental, workers compensation, payroll, profits, license, lease, service, service use, severance, stamp, occupation, windfall profits, customs, duties, franchise and other taxes imposed by the United States of America or any state, local or foreign government, or any agency thereof, or other political subdivision of the United States or any such government, and any interest, fines, penalties, assessments or additions to tax resulting from, attributable to or
incurred in connection with any tax or any contest or dispute thereof; and "Tax Returns" shall mean all reports, returns, declarations, statements or other information required to be supplied to a governmental or regulatory authority or agency, or to any other person, in connection with Taxes and any associated schedules or work papers produced in connection with such items;
(i) All issued and outstanding Acquired Fund Shares are, and at the Closing Date will be, duly and validly issued and outstanding, fully paid and nonassessable by the Acquired Fund. All of the issued and outstanding Acquired Fund Shares will, at the time of Closing, be held of record by the persons and in the amounts set forth in the Shareholder List submitted to the Acquiring Fund pursuant to Paragraph 3.5 hereof. The Acquired Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any Acquired Fund Shares, nor is there outstanding any security convertible into any Acquired Fund Shares;
(j) At the Closing Date, the Acquired Fund will have good and marketable title to the Acquired Assets, and full right, power and authority to sell, assign, transfer and deliver the Acquired Assets to the Acquiring Fund, and, upon delivery and payment for the Acquired Assets, the Acquiring Fund will acquire good and marketable title thereto, subject to no restrictions on the full transfer thereof, except such restrictions as might arise under the Securities Act;
(k) The AmSouth Trust has the trust power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement have been duly authorized by all necessary action on the part of the AmSouth Trust's Board of Trustees, and, subject to the approval of the Acquired Fund's shareholders, assuming due authorization, execution and delivery by the Acquiring Fund, this Agreement will constitute a valid and binding obligation of the Acquired Fund, enforceable in accordance with its terms, subject as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and other laws relating to or affecting creditors' rights and to general equity principles;
(l) The information to be furnished by the Acquired Fund to the Acquiring Fund for use in applications for orders, registration statements, proxy materials and other documents which may be necessary in connection with the transactions contemplated hereby and any information necessary to compute the total return of the Acquired Fund shall be accurate and complete and shall comply in all material respects with federal securities and other laws and regulations applicable thereto;
(m) The information included in the proxy statement (the "Proxy Statement") forming part of the Acquiring Fund's Registration Statement on Form N-14 filed in connection with this Agreement (the "Registration Statement") that has been furnished in writing by the Acquired Fund to the Acquiring Fund for inclusion in the Registration Statement, on the effective date of that Registration Statement and on the Closing Date, will conform in all material respects to the applicable requirements of the Securities Act, the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Investment Company Act and the rules and regulations of the Commission thereunder and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading;
(n) Upon the effectiveness of the Registration Statement, no consent, approval, authorization or order of any court or governmental authority is required for the consummation by the AmSouth Trust or the Acquired Fund of the transactions contemplated by this Agreement;
(o) All of the issued and outstanding Acquired Fund Shares have been offered for sale and sold in conformity with all applicable federal and state securities laws, except as may have been previously disclosed in writing to the Acquiring Fund;
(p) The prospectus and statement of additional information of the Acquired Fund, and any amendments or supplements thereto, furnished to the Acquiring Fund, did not as of their dates or the dates of their distribution to the public contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which such statements were made, not misleading;
(q) The Acquired Fund currently complies in all material respects with, and since its organization has complied in all material respects with, the requirements of, and the rules and regulations under, the Investment Company Act, the Securities Act, the Exchange Act, state "Blue Sky" laws and all other applicable federal and state laws or regulations. The Acquired Fund currently complies in all material respects with, and since its organization has complied in all material respects with, all investment objectives, policies, guidelines and restrictions and any compliance procedures established by the AmSouth Trust with respect to the Acquired Fund. All advertising and sales material used by the Acquired Fund complies in all material respects with and has complied in all material respects with the applicable requirements of the Securities Act, the Investment Company Act, the rules and regulations of the Commission, and, to the extent applicable, the Conduct Rules of the National Association of Securities Dealers, Inc. (the "NASD") and any applicable state regulatory authority. All registration statements, prospectuses, reports, proxy materials or other filings required to be made or filed with the Commission, the NASD or any state securities authorities by the Acquired Fund have been duly filed and have been approved or declared effective, if such approval or declaration of effectiveness is required by law. Such registration statements, prospectuses, reports, proxy materials and other filings under the Securities Act, the Exchange Act and the Investment Company Act (i) are or were in compliance in all material respects with the requirements of all applicable statutes and the rules and regulations thereunder and (ii) do not or did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not false or misleading;
(r) The Acquired Fund has previously provided to the Acquiring Fund (and at the Closing will provide an update through the Closing Date of such information) data which supports a calculation of the Acquired Fund's total return for all periods since the organization of the Acquired Fund. Such data has been prepared in accordance in all material respects with the requirements of the Investment Company Act and the regulations thereunder and the rules of the NASD;
(s) Neither the Acquired Fund nor, to the knowledge of the Acquired Fund,
any "affiliated person" of the Acquired Fund has been convicted of any felony or
misdemeanor, described in Section 9(a)(1) of the Investment Company Act, nor, to
the knowledge of the Acquired Fund, has any affiliated person of the Acquired
Fund been the subject, or presently is the subject, of any proceeding or
investigation with respect to any disqualification that would be a basis for
denial, suspension or revocation of registration as an investment adviser under
Section 203(e) of the Investment Advisers Act of 1940, as amended (the
"Investment Advisers Act"), or Rule 206(4)-4(b) thereunder or of a broker-dealer
under Section 15 of the Exchange Act, or for disqualification as an investment
adviser, employee, officer or director of an investment company under Section 9
of the Investment Company Act; and
(t) The tax representation certificate to be delivered by AmSouth Trust on behalf of the Acquired Fund to the Acquiring Trust and Wilmer Cutler Pickering Hale and Dorr LLP at the Closing pursuant to Paragraph 7.4 (the "Acquired Fund Tax Representation Certificate") will not on the Closing Date contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein not misleading.
4.2 Except as set forth on a disclosure schedule previously provided by the Acquiring Trust to the AmSouth Trust (which disclosure schedule shall be organized by the sections of this Section 4.2 and any disclosure shall only modify the portions of this Section 4.2 expressly identified in such schedule), the Acquiring Trust, on behalf of the Acquiring Fund, represents, warrants and covenants to the Acquired Fund, which representations, warranties and covenants will be true and correct on the date hereof and on the Closing Date as though made on and as of the Closing Date, as follows:
(a) The Acquiring Fund is a series of the Acquiring Trust. The Acquiring Fund has not commenced operations and will not do so until the Closing. The Acquiring Trust is a statutory trust duly organized, validly existing and in good standing under the laws of the State of Delaware. The Acquiring Trust has the power to own all of its properties and assets and to perform the obligations under this Agreement. The Acquiring Fund is not required to qualify to do business in any jurisdiction in which it is not so qualified or where failure to qualify would subject it to any material liability or disability. Each of the Acquiring Trust and the Acquiring Fund has all necessary federal, state and local authorizations to own all of its properties and assets and to carry on its business as now being conducted;
(b) The Acquiring Trust is a registered investment company classified as a management company of the open-end type, and its registration with the Commission as an investment company under the Investment Company Act is in full force and effect;
(c) The Acquiring Fund's registration statement on Form N-1A that will be in effect on the Closing Date, and the prospectus and statement of additional information of the Acquiring Fund included therein, will conform in all material respects with the applicable requirements of the Securities Act and the Investment Company Act and the rules and regulations of the Commission thereunder, and did not as of the effective date thereof and will not as of the Closing Date contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading;
(d) The Registration Statement, the Proxy Statement and statement of additional information with respect to the Acquiring Fund and any amendments or supplements thereto in effect on or prior to the Closing Date included in the Registration Statement (other than written information furnished by the Acquired Fund for inclusion therein, as covered by the Acquired Fund's warranty in Paragraph 4.1(m) hereof) will conform in all material respects to the applicable requirements of the Securities Act and the Investment Company Act and the rules and regulations of the Commission thereunder. Neither the Registration Statement nor the Proxy Statement (other than written information furnished by the Acquired Fund for inclusion therein, as covered by the Acquired Fund's warranty in Paragraph 4.1(m) hereof) includes or will include any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading;
(e) The Acquiring Trust is not in violation of, and the execution and delivery of this Agreement and performance of its obligations under this Agreement will not result in a violation of, any provisions of the Declaration of Trust or by-laws of the Acquiring Trust or any material agreement, indenture, instrument, contract, lease or other undertaking with respect to the Acquiring Fund to which the Acquiring Trust is a party or by which the Acquiring Fund or any of its assets is bound;
(f) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or threatened against the Acquiring Fund or any of the Acquiring Fund's properties or assets. The Acquiring Fund knows of no facts which might form the basis for the institution of such proceedings. Neither the Acquiring Trust nor the Acquiring Fund is a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially adversely affects the Acquiring Fund's business or its ability to consummate the transactions contemplated herein;
(g) The Acquiring Fund has no actual or potential liability for any Tax obligation of any taxpayer. The Acquiring Fund is not and has never been a member of a group of corporations with which it has filed (or been required to file) consolidated, combined or unitary Tax Returns. The Acquiring Fund is not a party to any Tax allocation, sharing, or indemnification agreement;
(h) The Acquiring Fund has not taken or agreed to take any action, and is not aware of any agreement, plan or other circumstance, that is inconsistent with the representations set forth in Annex A;
(i) The authorized capital of the Acquiring Fund consists of an unlimited number of shares of beneficial interest, no par value per share. As of the Closing Date, the Acquiring Fund will be authorized to issue an unlimited number of shares of beneficial interest, no par value per share. The Acquiring Fund Shares to be issued and delivered to the Acquired Fund for the account of the Acquired Fund Shareholders pursuant to the terms of this Agreement will have been duly authorized on the Closing Date and, when so issued and delivered, will be duly and validly issued, fully paid and non-assessable. The Acquiring Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any Acquiring Fund shares, nor is there outstanding any security convertible into any Acquiring Fund shares, nor will the Acquiring Fund have any issued or outstanding shares on or before the Closing Date other than those issued to the Acquiring Fund Adviser or one of its affiliates, which shares shall be redeemed, for an amount equal to the price paid therefor, at or before the Closing;
(j) The Acquiring Trust has the trust power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance of this Agreement have been duly authorized by all necessary action on the part of the Acquiring Trust's Board of Trustees, and, assuming due authorization, execution and delivery by the Acquired Fund, this Agreement will constitute a valid and binding obligation of the Acquiring Fund, enforceable in accordance with its terms, subject as to enforcement, to bankruptcy, insolvency, reorganization, moratorium and other laws relating to or affecting creditors' rights and to general equity principles;
(k) The information to be furnished in writing by the Acquiring Fund or the Acquiring Fund Adviser for use in applications for orders, registration statements, proxy materials and other documents which may be necessary in connection with the transactions contemplated hereby shall be accurate and complete in all material respects and shall comply in all material respects with federal securities and other laws and regulations applicable thereto or the requirements of any form for which its use is intended, and shall not contain any untrue statement of a material fact or omit to state a material fact necessary to make the information provided not misleading;
(l) No consent, approval, authorization or order of or filing with any court or governmental authority is required for the execution of this Agreement or the consummation of the transactions contemplated by the Agreement by the Acquiring Fund, except for the registration of the Acquiring Fund Shares under the Securities Act and the Investment Company Act;
(m) Neither the Acquiring Fund nor, to the knowledge of the Acquiring Fund, any "affiliated person" of the Acquiring Fund has been convicted of any felony or misdemeanor, described in Section 9(a)(1) of the Investment Company Act, nor, to the knowledge of the Acquiring Fund, has any affiliated person of the Acquiring Fund been the subject, or presently is the subject, of any proceeding or investigation with respect to any disqualification that would be a basis for denial, suspension or revocation of registration as an investment adviser under Section 203(e) of the Investment Advisers Act or Rule 206(4)-4(b) thereunder or of a broker-dealer under Section 15 of the Exchange Act, or for disqualification as an investment adviser, employee, officer or director of an investment company under Section 9 of the Investment Company Act; and
(n) The tax representation certificate to be delivered by the Acquiring Trust on behalf of the Acquiring Fund to the AmSouth Trust and Wilmer Cutler Pickering Hale and Dorr LLP at Closing pursuant to Section 6.3 (the "Acquiring Fund Tax Representation Certificate") will not on the Closing Date contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein not misleading.
5. COVENANTS OF THE FUNDS
5.1 The Acquired Fund will operate the Acquired Fund's business in the ordinary course of business between the date hereof and the Closing Date. It is understood that such ordinary course of business will include the declaration and payment of customary dividends and other distributions and any other dividends and other distributions necessary or advisable (except to the extent dividends or other distributions that are not customary may be limited by representations made in connection with the issuance of the tax opinion described in Paragraph 8.5 hereof), in each case payable either in cash or in additional shares.
5.2 The AmSouth Trust will call a special meeting of the Acquired Fund's shareholders to consider approval of this Agreement and act upon the matters set forth in the Proxy Statement.
5.3 The Acquiring Fund will prepare the notice of meeting, form of proxy and Proxy Statement (collectively, "Proxy Materials") to be used in connection with such meeting, and will promptly prepare and file with the Commission the Registration Statement. The AmSouth Trust will provide the Acquiring Fund with information reasonably requested for the preparation of the Registration Statement in compliance with the Securities Act, the Exchange Act, and the Investment Company Act.
5.4 The Acquired Fund covenants that the Acquiring Fund Shares to be issued hereunder are not being acquired by the Acquired Fund for the purpose of making any distribution thereof other than in accordance with the terms of this Agreement.
5.5 The Acquired Fund will assist the Acquiring Fund in obtaining such information as the Acquiring Fund reasonably requires concerning the beneficial ownership of the Acquired Fund Shares.
5.6 Subject to the provisions of this Agreement, each Fund will take, or cause to be taken, all actions, and do or cause to be done, all things reasonably necessary, proper or advisable to consummate the transactions contemplated by this Agreement.
5.7 The Acquired Fund shall furnish to the Acquiring Fund on the Closing Date a Statement of Assets and Liabilities of the Acquired Fund as of the Closing Date setting forth the NAV of the Acquired Fund as of the Valuation Time, which statement shall be prepared in accordance with GAAP consistently applied and certified by the AmSouth Trust's Treasurer or Assistant Treasurer. As promptly as practicable, but in any case within 30 days after the Closing Date, the AmSouth Trust shall furnish to the Acquiring Trust, in such form as is reasonably satisfactory to the Acquiring Trust, a statement of the earnings and profits of the Acquired Fund for federal income tax purposes, and of any capital loss carryovers and other items that will be carried over to the Acquiring Fund under the Code, and which statement will be certified by the Treasurer of the AmSouth Trust.
5.8 Neither Fund shall take any action that is inconsistent with the representations set forth in, with respect to the Acquired Fund, the Acquired Fund Tax Representation Certificate and, with respect to the Acquiring Fund, the Acquiring Fund Tax Representation Certificate.
5.9 From and after the date of this Agreement and until the Closing Date,
each of the Funds and the AmSouth Trust and the Acquiring Trust shall use its
commercially reasonable efforts to cause the Reorganization to qualify, and will
not knowingly take any action, cause any action to be taken, fail to take any
action or cause any action to fail to be taken, which action or failure to act
could prevent the Reorganization from qualifying, as a reorganization under the
provisions of Section 368(a) of the Code. The parties hereby adopt this
Agreement as a "plan of reorganization" within the meaning of Sections
1.368-2(g) and 1.368-3(a) of the income tax regulations promulgated under the
Code. Unless otherwise required pursuant to a "determination" within the meaning
of Section 1313(a) of the Code, the parties hereto shall treat and report the
transactions contemplated hereby as a reorganization within the meaning of
Section 368(a)(1)(F) of the Code and shall not take any position inconsistent
with such treatment.
5.10 From and after the date of this Agreement and through the time of the Closing, each Fund shall use its commercially reasonable efforts to cause it to qualify, and will not knowingly take any action, cause any action to be taken, fail to take any action or cause any action to fail to be taken, which action or failure to act could prevent it from qualifying, as a regulated investment company under the provisions of Subchapter M of the Code.
5.11 The Acquired Fund shall prepare, or cause to be prepared, all Tax Returns of the Acquired Fund for taxable periods that end on or before the Closing Date and shall timely file, or cause to be timely filed, all such Tax Returns. The Acquired Fund shall make any payments of Taxes required to be made by such Fund with respect to any such Tax Returns.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND
The obligations of the Acquired Fund to complete the transactions provided for herein shall be, at its election, subject to the performance by the Acquiring Fund of all the obligations to be performed by it hereunder on or before the Closing Date, and, in addition thereto, the following further conditions, unless waived by the Acquired Fund in writing:
6.1 All representations and warranties by the Acquiring Trust on behalf of the Acquiring Fund contained in this Agreement shall be true and correct as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date;
6.2 The Acquiring Trust shall have delivered to the AmSouth Trust on the Closing Date a certificate of the Acquiring Trust on behalf of the Acquiring Fund executed in its name by its President or Vice President and its Treasurer or Assistant Treasurer, in form and substance satisfactory to the AmSouth Trust and dated as of the Closing Date, to the effect that the representations and warranties of the Acquiring Trust made in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, that each of the conditions to Closing in this Article 6 have been met, and as to such other matters as the AmSouth Trust shall reasonably request;
6.3 The Acquiring Trust on behalf of the Acquiring Fund shall have delivered to the AmSouth Trust and Wilmer Cutler Pickering Hale and Dorr LLP an Acquiring Fund Tax Representation Certificate, satisfactory to the AmSouth Trust and Wilmer Cutler Pickering Hale and Dorr LLP, substantially in the form attached to this Agreement as Annex A, concerning certain tax-related matters with respect to the Acquiring Fund;
6.4 With respect to the Acquiring Fund, the Board of Trustees of the Acquiring Trust shall have determined that the Reorganization is in the best interests of the Acquiring Fund and, based upon such determination, shall have approved this Agreement and the transactions contemplated hereby; and
6.5 The AmSouth Trust shall have received at the Closing a favorable opinion as to the due authorization of this Agreement by the Acquiring Trust and related matters of Wilmer Cutler Pickering Hale and Dorr LLP, dated as of the Closing Date, in a form reasonably satisfactory to the AmSouth Trust.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND
The obligations of the Acquiring Fund to complete the transactions provided for herein shall be, at its election, subject to the performance by the Acquired Fund of all the obligations to be performed by it hereunder on or before the Closing Date and, in addition thereto, the following further conditions, unless waived by the Acquiring Fund in writing:
7.1 All representations and warranties of the AmSouth Trust on behalf of the Acquired Fund contained in this Agreement shall be true and correct as of the date hereof and, except as they may be affected by the transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date;
7.2 The AmSouth Trust shall have delivered to the Acquiring Fund the Statement of Assets and Liabilities of the Acquired Fund pursuant to Paragraph 5.7, together with a list of its portfolio securities showing the federal income tax bases and holding periods of such securities, as of the Closing Date, certified by the AmSouth Trust's Treasurer or Assistant Treasurer;
7.3 The AmSouth Trust shall have delivered to the Acquiring Trust on the Closing Date a certificate of the AmSouth Trust on behalf of the Acquired Fund executed in its name by its President or Vice President and a Treasurer or Assistant Treasurer, in form and substance reasonably satisfactory to the Acquiring Trust and dated as of the Closing Date, to the effect that the representations and warranties of the AmSouth Trust contained in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, that each of the conditions to closing in this Article 7 have been met, and as to such other matters as the Acquiring Trust shall reasonably request;
7.4 The AmSouth Trust on behalf of the Acquired Fund shall have delivered to the Acquiring Trust and Wilmer Cutler Pickering Hale and Dorr LLP an Acquired Fund Tax Representation Certificate, satisfactory to the Acquiring Trust and Wilmer Cutler Pickering Hale and Dorr LLP, substantially in the form attached to this Agreement as Annex B, concerning certain tax-related matters with respect to the Acquired Fund;
7.5 The Acquiring Trust shall have received at the Closing a favorable opinion as to the due authorization of this Agreement by the AmSouth Trust and related matters of Kirkpatrick & Lockhart Nicholson Graham LLP, dated as of the Closing Date, in a form reasonably satisfactory to the Acquiring Trust; and
7.6 With respect to the Acquired Fund, the Board of Trustees of the AmSouth Trust shall have determined that the Reorganization is in the best interests of the Acquired Fund and, based upon such determination, shall have approved this Agreement and the transactions contemplated hereby.
8. FURTHER CONDITIONS PRECEDENT
If any of the conditions set forth below does not exist on or before the Closing Date with respect to either party hereto, the other party to this Agreement shall, at its option, not be required to consummate the transactions contemplated by this Agreement:
8.1 This Agreement and the transactions contemplated herein shall have been approved by the requisite vote of the Acquired Fund's shareholders in accordance with the provisions of the AmSouth Trust's Trust Instrument and By-Laws, and certified copies of the resolutions evidencing such approval by the Acquired Fund's shareholders shall have been delivered by the Acquired Fund to the Acquiring Fund. Notwithstanding anything herein to the contrary, neither party hereto may waive the conditions set forth in this Paragraph 8.1;
8.2 On the Closing Date, no action, suit or other proceeding shall be pending before any court or governmental agency in which it is sought to restrain or prohibit, or obtain damages or other relief in connection with, this Agreement or the transactions contemplated herein;
8.3 All consents of other parties and all other consents, orders and permits of federal, state and local regulatory authorities (including those of the Commission and of state Blue Sky and securities authorities) deemed necessary by either party hereto to permit consummation, in all material respects, of the transactions contemplated hereby shall have been obtained, except where failure to obtain any such consent, order or permit would not involve a risk of a material adverse effect on the assets or properties of either party hereto, provided that either party may waive any such conditions for itself;
8.4 The Acquiring Trust's Registration Statement on Form N-14 shall have become effective under the Securities Act and no stop orders suspending the effectiveness of such Registration Statement shall have been issued and, to the best knowledge of the parties hereto, no investigation or proceeding for that purpose shall have been instituted or be pending, threatened or contemplated under the Securities Act; and
8.5 The parties shall have received an opinion of Wilmer Cutler Pickering
Hale and Dorr LLP, satisfactory to the AmSouth Trust and the Acquiring Trust and
subject to customary assumptions and qualifications, substantially to the effect
that for federal income tax purposes the acquisition by the Acquiring Fund of
the Acquired Assets solely in exchange for the issuance of Acquiring Fund Shares
to the Acquired Fund and the assumption of the Assumed Liabilities by the
Acquiring Fund, followed by the distribution by the Acquired Fund, in
liquidation of the Acquired Fund, of Acquiring Fund Shares to the Acquired Fund
Shareholders in exchange for their Acquired Fund Shares and the termination of
the Acquired Fund, will constitute a "reorganization" within the meaning of
Section 368(a) of the Code
9. BROKERAGE FEES AND EXPENSES
9.1 Each party hereto represents and warrants to the other party hereto that there are no brokers or finders entitled to receive any payments in connection with the transactions provided for herein.
9.2 The parties have been informed by AmSouth Asset Management Inc. ("AAMI") and the Acquiring Fund Adviser -- and the parties have entered into this Agreement in reliance on such information -- that such non-parties will pay (with each of AAMI and the Acquiring Fund Adviser being responsible for 50% of such amounts) all proxy statement and solicitation costs of the Funds associated with the Reorganization including, but not limited to, the expenses associated with the preparation, printing and mailing of any and all shareholder notices,
communications, proxy statements, and necessary filings with the SEC or any other governmental authority in connection with the transactions contemplated by this Agreement, and the fees and expenses of any proxy solicitation firm retained in connection with the Reorganization. Except for the foregoing, AAMI shall bear the expenses of the Acquired Fund in connection with the transactions contemplated by this Agreement.
10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES
10.1 The Acquiring Trust and the AmSouth Trust each agrees that neither party has made any representation, warranty or covenant not set forth herein or referred to in Paragraphs 4.1 or 4.2 hereof and that this Agreement constitutes the entire agreement between the parties.
10.2 The representations and warranties contained in this Agreement or in any document delivered pursuant hereto or in connection herewith shall not survive the consummation of the transactions contemplated hereunder.
11. TERMINATION
11.1 This Agreement may be terminated by the mutual agreement of the Acquiring Trust and the AmSouth Trust. In addition, either party may at its option terminate this Agreement at or prior to the Closing Date:
(a) because of a material breach by the other of any representation, warranty, covenant or agreement contained herein to be performed at or prior to the Closing Date;
(b) because of a condition herein expressed to be precedent to the obligations of the terminating party which has not been met and which reasonably appears will not or cannot be met;
(c) by resolution of the Acquiring Trust's Board of Trustees if circumstances should develop that, in the good faith opinion of such Board, make proceeding with the Agreement not in the best interests of the Acquiring Fund's shareholders;
(d) by resolution of the AmSouth Trust's Board of Trustees if circumstances should develop that, in the good faith opinion of such Board, make proceeding with the Agreement not in the best interests of the Acquired Fund's shareholders; or
(e) if the transactions contemplated by this Agreement shall not have occurred on or prior to December 31, 2005 or such other date as the parties may mutually agree upon in writing.
11.2 In the event of any such termination, there shall be no liability for damages on the part of the Acquiring Fund, the Acquiring Trust, the AmSouth Trust or the Acquired Fund, or the trustees or officers of the AmSouth Trust, or the Acquiring Trust, but, subject to Paragraph 9.2, each party shall bear the expenses incurred by it incidental to the preparation and carrying out of this Agreement.
12. AMENDMENTS
This Agreement may be amended, modified or supplemented in such manner as may be mutually agreed upon in writing by the authorized officers of the AmSouth Trust and the Acquiring Trust; provided, however, that following the meeting of the Acquired Fund's shareholders called by the AmSouth Trust pursuant to Paragraph 5.2 of this Agreement, no such amendment may have the effect of changing the provisions regarding the method for determining the number of Acquiring Fund Shares to be received by the Acquired Fund Shareholders under this Agreement to their detriment without their further approval; provided that nothing contained in this Section 12 shall be construed to prohibit the parties from amending this Agreement to change the Closing Date.
13. NOTICES
Any notice, report, statement or demand required or permitted by any provisions of this Agreement shall be in writing and shall be given by prepaid telegraph, telecopy or certified mail addressed to the Acquired Fund, c/o AmSouth Asset Management Inc., 3435 Stelzer Road, Columbus, Ohio 43219, Attention: [ ], with copies to Kirkpatrick & Lockhart Nicholson Graham LLP, 1800 Massachusetts Avenue, N.W., Washington, DC 20036-1221, Attention: Clifford J. Alexander, and to the Acquiring Fund, c/o Pioneer Investment Management, Inc., 60 State Street, Boston, Massachusetts 02109, Attention: Dorothy E. Bourassa, Esq., with copies to Wilmer Cutler Pickering Hale and Dorr LLP, 60 State Street, Boston, Massachusetts 02109, Attention: David C. Phelan.
14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
14.1 The article and paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
14.2 This Agreement may be executed in any number of counterparts, each of which shall be deemed an original.
14.3 This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to conflict of laws principles (other than Delaware Code Title 6 ss. 2708); provided that, in the case of any conflict between those laws and the federal securities laws, the latter shall govern.
14.4 This Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns, but no assignment or transfer hereof or of any rights or obligations hereunder shall be made by either party without the prior written consent of the other party hereto. Nothing herein expressed or implied is intended or shall be construed to confer upon or give any person, firm or corporation, or other entity, other than the parties hereto and their respective successors and assigns, any rights or remedies under or by reason of this Agreement.
14.5 It is expressly agreed that the obligations of the Acquiring Trust and the AmSouth Trust shall not be binding upon any of their respective trustees, shareholders, nominees, officers, agents or employees personally, but bind only to the property of the Acquiring Fund or the Acquired Fund, as the case may be, as provided in the trust instruments of the Acquiring Trust and the Instrument of Trust of the AmSouth Trust, respectively. The execution and delivery of this Agreement have been authorized by the trustees of the Acquiring Trust and of the AmSouth Trust and this Agreement has been executed by authorized officers of the Acquiring Trust and the AmSouth Trust, acting as such, and neither such authorization by such trustees nor such execution and delivery by such officers shall be deemed to have been made by any of them individually or to imposed any liability on any of them personally, but shall bind only the property of the Acquiring Fund and the Acquired Fund, as the case may be, as provided in the trust instruments of the Acquiring Trust and the Instrument of Trust of the AmSouth Trust, respectively.
* * * * *
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be executed as of the date first set forth above by its President or Vice President and attested by its Secretary or Assistant Secretary.
Attest: AMSOUTH FUNDS
on behalf of AMSOUTH [ ] FUND
By: ________________________________ By: _______________________________
Name: Name:
Title: [Assistant] Secretary Title: [Vice] President
Attest: PIONEER [ ] FUND
on behalf of PIONEER [ ] FUND
By: ________________________________ By: _______________________________
Name: Christopher J. Kelley Name: Osbert M. Hood
Title: Assistant Secretary Title: Executive Vice President
|
Annex A
TAX REPRESENTATION CERTIFICATE OF
PIONEER [ ] FUND
ON BEHALF OF PIONEER [ ] FUND
This certificate is being delivered in connection with the transactions to be
effected pursuant to the Agreement and Plan of Reorganization made as of [ ],
2005 between Pioneer [ ] Fund, a Delaware statutory trust ("Acquiring Trust"),
on behalf of its series Pioneer [ ] Fund ("Acquiring Fund"), and AmSouth Funds,
a Massachusetts business trust, on behalf of its series AmSouth [ ] Fund
("Acquired Fund") (the "Agreement"). Pursuant to the Agreement, Acquiring Fund
will acquire all of the assets of Acquired Fund in exchange solely for (i) the
assumption by Acquiring Fund of the Assumed Liabilities of Acquired Fund, and
(ii) the issuance of shares of beneficial interest of Acquiring Fund (the
"Acquiring Fund Shares") to Acquired Fund, followed by the distribution by
Acquired Fund, in liquidation of Acquired Fund, of the Acquiring Fund Shares to
the shareholders of Acquired Fund and the termination of Acquired Fund (the
foregoing together constituting the "transaction").
The undersigned officer of Acquiring Trust, after consulting with its counsel, auditors and tax advisers regarding the meaning of and factual support for the following representations, on behalf of Acquiring Fund, hereby certifies and represents that the following statements are true, complete and correct and will be true, complete and correct on the date of the transaction and thereafter as relevant. Unless otherwise indicated, all capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement.
1. Acquiring Fund is a series of Acquiring Trust, a statutory trust organized under the laws of the State of Delaware, and Acquiring Fund will be treated after the Closing as a separate corporation for federal tax purposes. Acquiring Fund was newly organized solely for the purpose of effecting the transaction and continuing thereafter to operate as a regulated investment company. Prior to the transaction, Acquiring Fund did not and will not engage in any business activities. There shall be no shares of Acquiring Fund issued and outstanding prior to the Closing Date other than those issued to Pioneer Investment Management, Inc. or one of its affiliates in connection with the creation of Acquiring Fund, which shares shall be redeemed, for an amount equal to the price paid therefor, at or before the Closing.
2. Neither Acquiring Fund nor any person "related" to Acquiring Fund (as defined in Treasury Regulation Section 1.368-1(e)(3)), nor any partnership of which Acquiring Fund or any such related person is a partner, has any plan or intention to redeem or otherwise acquire any of the Acquiring Fund Shares received by shareholders of Acquired Fund in the transaction except in the ordinary course of Acquiring Fund's business in connection with its legal obligation under Section 22(e) of the Investment Company Act of 1940, as amended (the "1940 Act"), as a series of a registered open-end investment company to redeem its own shares.
3. After the transaction, Acquiring Fund will continue the historic business (as defined in Treasury Regulation Section 1.368-1(d)(2)) of Acquired Fund or will use a significant portion of the historic business assets (as defined in Treasury Regulation Section 1.368-1(d)(3)) of Acquired Fund in a business.
4. Acquiring Fund has no plan or intention to sell or otherwise dispose of any assets of Acquired Fund acquired in the transaction, except for dispositions made in the ordinary course of its business or to maintain its qualification as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code").
5. Any expenses of Acquired Fund incurred in connection with the transaction which are paid or assumed by Acquiring Fund will be expenses of Acquired Fund solely and directly related to the transaction in accordance with Rev. Rul. 73 54, 1973 1 C.B. 187. Acquiring Fund will not pay or assume the expenses, if any, incurred by any Acquired Fund Shareholders in connection with the transaction.
6. There is no, and never has been any, indebtedness between Acquiring Fund and Acquired Fund.
7. Acquiring Fund will qualify for the special tax treatment afforded regulated investment companies under Subchapter M of the Code for all taxable years ending after the date of the transaction.
8. Acquiring Fund will meet the requirements of an "investment company" in
Section 368(a)(2)(F) of the Code from and after the date of the transaction.
9. Acquiring Fund is not under the jurisdiction of a court in a Title 11 or similar case within the meaning of Section 368(a)(3)(A) of the Code.
10. Acquiring Fund does not now own and has never owned, directly or indirectly, any shares of Acquired Fund.
11. As of the date of the transaction, the fair market value of the Acquiring Fund Shares issued to Acquired Fund will be approximately equal to the fair market value of the Acquired Assets minus the Assumed Liabilities. Acquiring Fund will not furnish any consideration in connection with the acquisition of the Acquired Assets other than the assumption of the Assumed Liabilities and the issuance of such Acquiring Fund Shares.
12. Immediately following the transaction, the Acquired Fund Shareholders will own all of the outstanding Acquiring Fund Shares and will own such shares solely by reason of their ownership of the Acquired Fund Shares immediately prior to the transaction. Acquiring Fund has no plan or intention to issue as part of the transaction any shares of Acquiring Fund other than the Acquiring Fund Shares issued in exchange for the Acquired Assets.
13. The transaction is being undertaken for valid and substantial business purposes, including facilitating Acquired Fund's becoming a member of the Pioneer family of mutual funds, which, in the long term, is intended to result in lower expenses and increased assets.
14. No Acquired Fund shareholder is acting as agent for Acquiring Fund in connection with the transaction or approval thereof. Acquiring Fund will not reimburse any Acquired Fund shareholder for Acquired Fund Shares such shareholder may have purchased or for other obligations such shareholder may have incurred.
15. Acquiring Fund has no outstanding warrants, options, convertible securities or any other type of right pursuant to which any person could acquire stock in Acquiring Fund.
* * * * *
The undersigned officer of Acquiring Trust is authorized to make all of the representations set forth herein, and the undersigned is authorized to execute this certificate on behalf of Acquiring Fund. The undersigned recognizes that Wilmer Cutler Pickering Hale and Dorr LLP will rely upon the foregoing representations in evaluating the United States federal income tax consequences of the transaction and rendering its opinion pursuant to Section 8.5 of the Agreement. If, prior to the date of the transaction, any of the representations set forth herein ceases to be accurate, the undersigned agrees to deliver immediately to Wilmer Cutler Pickering Hale and Dorr LLP a written notice to that effect.
PIONEER [ ] FUND
on behalf of PIONEER [ ] FUND
By: ___________________________
Name: ___________________________
Title: ___________________________
Dated: _________, 2005
|
Annex B
TAX REPRESENTATION CERTIFICATE OF
AMSOUTH FUNDS
ON BEHALF OF AMSOUTH [ ] FUND
This certificate is being delivered in connection with the transactions to be
effected pursuant to the Agreement and Plan of Reorganization made as of [ ],
2005 between Pioneer [ ] Fund, a Delaware statutory trust, on behalf of its
series Pioneer [ ] Fund ("Acquiring Fund"), and AmSouth Funds, a Massachusetts
business trust ("AmSouth Trust"), on behalf of its series AmSouth [ ] Fund
("Acquired Fund") (the "Agreement"). Pursuant to the Agreement, Acquiring Fund
will acquire all of the assets of Acquired Fund in exchange solely for (i) the
assumption by Acquiring Fund of the Assumed Liabilities of Acquired Fund and
(ii) the issuance of shares of beneficial interest of Acquiring Fund (the
"Acquiring Fund Shares") to Acquired Fund, followed by the distribution by
Acquired Fund, in liquidation of Acquired Fund, of the Acquiring Fund Shares to
the shareholders of Acquired Fund and the termination of Acquired Fund (the
foregoing together constituting the "transaction").
The undersigned officer of AmSouth Trust, after consulting with its counsel, auditors and tax advisers regarding the meaning of and factual support for the following representations, on behalf of Acquired Fund, hereby certifies and represents that the following statements are true, complete and correct and will be true, complete and correct on the date of the transaction and thereafter as relevant. Unless otherwise indicated, all capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement.
1. Acquired Fund is a series of AmSouth Funds, a business trust organized under the laws of the Commonwealth of Massachusetts, and Acquired Fund is, and has been at all times, treated as a separate corporation for federal tax purposes.
2. As of the date of the transaction, the fair market value of the Acquiring Fund Shares received by each shareholder that holds shares of Acquired Fund (the "Acquired Fund Shares") will be approximately equal to the fair market value of the Acquired Fund Shares with respect to which such Acquiring Fund Shares are received, and the aggregate consideration received by Acquired Fund shareholders in exchange for their Acquired Fund Shares will be approximately equal to the fair market value of all of the outstanding Acquired Fund Shares immediately prior to the transaction. No property other than Acquiring Fund Shares will be distributed to shareholders of Acquired Fund in exchange for their Acquired Fund Shares, nor will any such shareholder receive cash or other property as part of the transaction.
3. Neither Acquired Fund nor any person "related" to Acquired Fund (as
defined in Treasury Regulation Section 1.368-1(e)(3)), nor any partnership in
which Acquired Fund or any such related person is a partner, has redeemed,
acquired or otherwise made any distributions with respect to any shares of
Acquired Fund as part of the transaction, or otherwise pursuant to a plan of
which the transaction is a part, other than redemptions and distributions made
in the ordinary course of Acquired Fund's business as a series of an open-end
investment company. To the best knowledge of management of Acquired Fund, there
is no plan or intention on the part of the shareholders of Acquired Fund to
engage in any transaction with Acquired Fund, Acquiring Fund, or any person
treated as related to Acquired Fund or Acquiring Fund under Treasury Regulation
Section 1.368-1(e)(3) or any partnership in which Acquired Fund, Acquiring Fund,
or any person treated as related to Acquired Fund or Acquiring Fund under
Treasury Regulation Section 1.368-1(e)(3) is a partner involving the sale,
redemption or exchange of any of the Acquired Fund Shares or any of the
Acquiring Fund Shares to be received in the transaction, as the case may be,
other than in the ordinary course of Acquired Fund's business as a series of an
open-end investment company.
4. In the transaction, Acquired Fund will transfer its assets to Acquiring Fund, which will assume the Assumed Liabilities, such that immediately following the transfer, Acquiring Fund will possess all of the same assets and liabilities as were possessed by Acquired Fund immediately prior to the transaction, except for assets used to pay expenses incurred in connection with the transaction and assets distributed to shareholders in redemption of their shares immediately preceding, or in contemplation of, the transaction (other than redemptions and distributions
made in the ordinary course of Acquired Fund's business as an open-end investment company) which assets constitute less than 1% of the net assets of Acquired Fund.
5. As of the date of the transaction, the fair market value of the Acquiring Fund Shares issued to Acquired Fund will be approximately equal to the fair market value of the Acquired Assets minus the Assumed Liabilities. Acquired Fund will not receive any consideration from Acquiring Fund in connection with the acquisition of the Acquired Assets other than the assumption of the Assumed Liabilities and the issuance of such Acquiring Fund Shares.
6. The Assumed Liabilities assumed by Acquiring Fund plus the Assumed Liabilities, if any, to which the transferred assets are subject were incurred by Acquired Fund in the ordinary course of its business. Acquired Fund is not aware of any liabilities of any kind other than the Assumed Liabilities.
7. As of the Closing Date, the adjusted basis and the fair market value of the Acquired Assets will equal or exceed the Assumed Liabilities assumed for purposes of Section 357(d) of the Code.
8. Acquired Fund currently conducts its historic business within the meaning of Treasury Regulation Section 1.368-1(d)(2), which provides that, in general, a corporation's historic business is the business it has conducted most recently, but does not include a business that the corporation enters into as part of a plan of reorganization. The Acquired Fund assets transferred to Acquiring Fund will be Acquired Fund's historic business assets within the meaning of Treasury Regulation Section 1.368-1(d), which provides that a corporation's historic business assets are the assets used in its historic business.
9. Acquired Fund will distribute to its shareholders the Acquiring Fund Shares it receives pursuant to the transaction, and its other properties, if any, and will be liquidated promptly thereafter.
10. The expenses of Acquired Fund incurred by it in connection with the transaction, if any, will be only such expenses that are solely and directly related to the transaction in accordance with Rev. Rul. 73-54, 1973-1 C.B. 187. Acquired Fund will not pay any expenses incurred by its shareholders in connection with the transaction.
11. There is no, and never has been any, indebtedness between Acquiring Fund and Acquired Fund.
12. Acquired Fund has properly elected to be a regulated investment company under Subchapter M of the Code, has qualified for the special tax treatment afforded regulated investment companies under Subchapter M of the Code for each taxable year since inception, and qualifies for such treatment as of the time of the Closing.
13. Acquired Fund meets the requirements of an "investment company" in
Section 368(a)(2)(F) of the Code.
14. Acquired Fund is not under the jurisdiction of a court in a Title 11 or similar case within the meaning of Section 368(a)(3)(A) of the Code.
15. Acquired Fund does not pay compensation to any shareholder-employee.
16. Immediately following the transaction, the Acquired Fund Shareholders will own all of the outstanding Acquiring Fund Shares and will own such shares solely by reason of their ownership of the Acquired Fund Shares immediately prior to the transaction.
17. Acquired Fund shareholders will not have dissenters' or appraisal rights in the transaction.
18. The transaction is being undertaken for valid and substantial business purposes, including facilitating Acquired Fund's becoming a member of the Pioneer family of mutual funds, which, in the long term, is intended to result in lower expenses and increased assets.
19. Acquired Fund has no outstanding warrants, options, convertible securities or any other type of right pursuant to which any person could acquire stock in Acquired Fund.
* * * * *
The undersigned officer of the AmSouth Trust is authorized to make all of the representations set forth herein, and the undersigned is authorized to execute this certificate on behalf of Acquired Fund. The undersigned recognizes that Wilmer Cutler Pickering Hale and Dorr LLP will rely upon the foregoing representations in evaluating the United States federal income tax consequences of the transaction and rendering its opinion pursuant to Section 8.5 of the Agreement. If, prior to the date of the transaction, any of the representations set forth herein ceases to be accurate, the undersigned agrees to deliver immediately to Wilmer Cutler Pickering Hale and Dorr LLP a written notice to that effect.
AMSOUTH FUNDS
on behalf of AMSOUTH [ ] FUND
By: __________________________ Name: __________________________ Title: __________________________ |
Dated: __________, 2005
Exhibit B -- Additional Information Pertaining to Pioneer
PORTFOLIO TRANSACTION POLICIES
All orders for the purchase or sale of portfolio securities are placed on behalf of each fund by Pioneer pursuant to authority contained in the fund's management contract. Pioneer seeks to obtain the best execution on portfolio trades. The price of securities and any commission rate paid are always factors, but frequently not the only factors, in judging best execution. In selecting brokers or dealers, Pioneer considers various relevant factors, including, but not limited to, the size and type of the transaction; the nature and character of the markets for the security to be purchased or sold; the execution efficiency, settlement capability and financial condition of the dealer; the dealer's execution services rendered on a continuing basis; and the reasonableness of any dealer spreads. Transactions in non-U.S. equity securities are executed by broker-dealers in non-U.S. countries in which commission rates may not be negotiable (as such rates are in the U.S.).
Pioneer may select broker-dealers that provide brokerage and/or research services to a fund and/or other investment companies or other accounts managed by Pioneer. In addition, consistent with Section 28(e) of the Securities Exchange Act of 1934 as amended, if Pioneer determines in good faith that the amount of commissions charged by a broker-dealer is reasonable in relation to the value of the brokerage and research services provided by such broker, the fund may pay commissions to such broker-dealer in an amount greater than the amount another firm may charge. Such services may include advice concerning the value of securities; the advisability of investing in, purchasing or selling securities; the availability of securities or the purchasers or sellers of securities; providing stock quotation services, credit rating service information and comparative fund statistics; furnishing analyses, electronic information services, manuals and reports concerning issuers, industries, securities, economic factors and trends, portfolio strategy, and performance of accounts and particular investment decisions; and effecting securities transactions and performing functions incidental thereto (such as clearance and settlement). Pioneer maintains a listing of broker-dealers who provide such services on a regular basis. However, because many transactions on behalf of a fund and other investment companies or accounts managed by Pioneer are placed with broker-dealers (including broker-dealers on the listing) without regard to the furnishing of such services, it is not possible to estimate the proportion of such transactions directed to such dealers solely because such services were provided. Pioneer believes that no exact dollar value can be calculated for such services.
The research received from broker-dealers may be useful to Pioneer in rendering investment management services to any of the funds as well as other investment companies or other accounts managed by Pioneer, although not all such research may be useful to any of the funds. Conversely, such information provided by brokers or dealers who have executed transaction orders on behalf of such other accounts may be useful to Pioneer in carrying out its obligations to any of the funds. The receipt of such research has not reduced Pioneer's normal independent research activities; however, it enables Pioneer to avoid the additional expenses which might otherwise be incurred if it were to attempt to develop comparable information through its own staff.
None of the funds used any brokers affiliated with Pioneer during its most recently completed fiscal year in connection with its portfolio transactions.
SIMILAR FUNDS
Pioneer serves as the investment adviser to each fund in the Pioneer Family of Funds. The following table identifies other funds in the Pioneer Family of Funds that have similar investment objectives to the Funds described in this Proxy Statement/Prospectus and provides other information regarding the similar funds.
-------------------------------------------------------------------------------------------------------------
Fund Net assets of Fund Management fee rate (as a percentage of average
(as of March 31, 2005) daily net assets)
-------------------------------------------------------------------------------------------------------------
Pioneer AmPac Growth Fund $21,122,317 0.75% of the first $1 billion of the Fund's
average net assets and 0.70% of the excess over
$1 billion.
-------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------------
Fund Net assets of Fund Management fee rate (as a percentage of average
(as of March 31, 2005) daily net assets)
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Balanced Fund $138,289,597 0.65% of the Fund's average net assets up to $1
billion, 0.60% of the next $4 billion; and 0.55%
of the excess over $5 billion.
-------------------------------------------------------------------------------------------------------------------------------
Pioneer Equity Income Fund $959,952,939 0.60% of the Fund's average net assets up to $10
billion and 0.575% on the assets over $10 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Growth Leaders Fund $35,682,075 0.75% of the first $1 billion of the Fund's
average net assets and 0.70% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Growth Shares $641,452,946 0.70% of the Fund's average net assets up to
$500million, 0.65% of the next $500 million and
0.625% of the excess over $1 billion. +/- .10%
depending on performance vs. Russell 1000 Index.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Independence Fund $297,006,363 0.75%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer International Equity Fund $70,567,529 1.00% of the Fund's average net assets up to
$300million, 0.85% of the next $200 million and
0.75% of the excess over $500 million.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer International Value Fund $149,193,961 1.00% of the Fund's average net assets up to
$300million, 0.85% of the next $200 million and
0.75% of the excess over $500 million.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Large Cap Growth Fund $1,691,675 0.75%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Mid Cap Growth Fund $555,333,842 0.625% +/- .20% depending on performance vs. S&P
Mid Cap 400 Index.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Small Cap Growth Fund $170,125,644 0.85% of the first $1 billion of the Fund's
average net assets and 0.80% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Research Fund $23,134,484 0.75% of the first $1 billion of the Fund's
average net assets and 0.70% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Select Equity Fund $528,795 0.75%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Small and Mid Cap Growth Fund $56,864,340 0.85% of the first $1 billion of the Fund's
average net assets and 0.80% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Small Cap Value Fund $639,692,666 0.85%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Small Company Fund $181,304,365 0.85%
---------------------------------------------------------------------------------------------------------------------------------
|
---------------------------------------------------------------------------------------------------------------------------------
Fund Net assets of Fund Management fee rate (as a percentage of average
(as of March 31, 2005) daily net assets)
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Strategic Growth Fund $33,528,773 0.75% of the first $1 billion of the Fund's
average net assets and 0.70% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Variable Contracts Trust
---------------------------------------------------------------------------------------------------------------------------------
Pioneer America Income VCT Portfolio $46,258,507 0.55%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Balanced VCT Portfolio $45,294,667 0.65%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Equity Income VCT Portfolio $297,403,668 0.65%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Fund VCT Portfolio $560,671,869 0.65%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Growth Shares VCT Portfolio $37,553,901 0.70%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer International Value VCT Portfolio $25,843,084 1.00%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Mid Cap Value VCT Portfolio $890,841,912 0.65%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Oak Ridge Large Cap Growth VCT $6,346,744 0.75% of the first $1 billion of the Fund's
Portfolio average net assets and 0.70% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Papp America-Pacific Rim VCT $1,703,894 0.75% of the first $1 billion of the Fund's
Portfolio average net assets and 0.70% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Papp Small and Mid Cap Growth VCT $3,445,634 0.75% of the first $1 billion of the Fund's
Portfolio average net assets and 0.70% of the excess over
$1 billion.
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Small Cap Value VCT Portfolio $80,060,269 0.75%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Small Company VCT Portfolio $13,328,005 0.75%
---------------------------------------------------------------------------------------------------------------------------------
Pioneer Value VCT Portfolio $13,065,738 0.75%
---------------------------------------------------------------------------------------------------------------------------------
|
Exhibit C -- Portfolio Manager's Discussion of Performance
Pioneer Oak Ridge Large Cap Growth Fund
Performance Update 11/30/04 Class A Shares
Net Asset Value per Share 11/30/04 11/30/03
$12.51 $11.18
Distributions per Share
(12/1/03 - 11/30/04)
Net Investment Income $ --
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Oak Ridge Large Cap Growth Fund at public offering price, compared to that of the Russell 1000 Growth Index.
Average Annual Total Returns
(As of November 30, 2004)
Period Net Asset Value Public Offering Price (POP) Life-of-Class (3/1/99) 1.79% 0.75% 5 Years 1.31 0.12 1 Year 11.90 5.48 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Effective 2/17/04, the maximum sales charge for Class A shares is 5.75%. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The performance of each class of the Fund from March 1, 1999 to February 13, 2004 is the performance of Oak Ridge Large Cap Equity Fund's single class (Class A shares), which has been restated to reflect differences in any applicable sales charges and Rule 12b-1 fees payable on Class B and Class C shares (but not other differences in expenses). This adjustment has the effect of reducing the previously reported performance of Oak Ridge Large Cap Equity Fund. Pioneer Oak Ridge Large Cap Growth fund was created through the reorganization of predecessor Oak Ridge Funds, Inc. on February 13, 2004.
The Russell 1000 Growth Index is a measure of the performance of the value-oriented stocks in the Russell 1000 Index. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in any index.
Performance Update 11/30/04 Class B Shares
Net Asset Value per Share 11/30/04 2/17/04
$12.44 $11.86
Distributions per Share
(2/17/04 - 11/30/04)
Net Investment Income $ --
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Oak Ridge Large Cap Growth Fund at public offering price, compared to that of the Russell 1000 Growth Index.
Average Annual Total Returns
(As of November 30, 2004)
Period If Held If Redeemed Life-of-Class (3/1/99) 1.04$ 0.87% 5 Years 0.56 0.37 1 Year 11.09 7.09 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect deduction of applicable contingent deferred sales charge (CDSC). The maximum CDSC is 4% and declines over six years. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The performance of each class of the Fund from March 1, 1999 to February 13, 2004 is the performance of Oak Ridge Large Cap Equity Fund's single class (Class A shares), which has been restated to reflect differences in any applicable sales charges and Rule 12b-1 fees payable on Class B shares (but not other differences in expenses). This adjustment has the effect of reducing the previously reported performance of Oak Ridge Large Cap Equity Fund. Pioneer Oak Ridge Large Cap Growth fund was created through the reorganization of predecessor Oak Ridge Funds, Inc. on February 13, 2004. The Russell 1000 Growth Index is a measure of the performance of the value-oriented stocks in the Russell 1000 Index. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in any index.
Performance Update 11/30/04 Class Y Shares
Net Asset Value per Share 11/30/04 8/11/04
$12.53 $11.33
Distributions per Share
(8/11/04 - 11/30/04)
Net Investment Income $ --
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Oak Ridge Large Cap Growth Fund at public offering price, compared to that of the Russell 1000 Growth Index.
Average Annual Total Returns
(As of November 30, 2004)
Period If Held If Redeemed Life-of-Class (8/10/04) 1.82% 1.82% 5 Years 1.35 1.35 1 Year 12.07 12.07 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Performance for periods prior to the inception of Y shares reflects the NAV performance of the Fund's A shares. The performance does not reflect differences in expenses, including the Rule 12b-1 fees applicable to A shares. Since fees for A shares are generally higher than those of Y shares, the performance shown for Y shares prior to their inception would have been higher. Class A shares are used as a proxy from 3/1/99 to 8/10/04. Class Y shares are not subject to sales charges and are available for limited groups of eligible investors, including institutional investors. All results are historical and assume the reinvestment of dividends, and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The performance of each class of the Fund from March 1, 1999 to February 13, 2004 is the performance of Oak Ridge Large Cap Equity Fund's single class (Class A shares), which has been restated to reflect differences in any applicable sales charges (but not other differences in expenses). This adjustment has the effect of reducing the previously reported performance of Oak Ridge Large Cap Equity Fund. Pioneer Oak Ridge Large Cap Growth fund was created through the reorganization of predecessor Oak Ridge Funds, Inc. on February 13, 2004. The Russell 1000 Growth Index is a measure of the performance of the value-oriented stocks in the Russell 1000 Index. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in any index.
Portfolio Management Discussion 11/30/04
In the following interview, David Klaskin, Pioneer Oak Ridge Large Cap Growth Fund's Lead Portfolio Manager, discusses the factors that influenced performance for the twelve months ended November 30, 2004.
Q: How did the U.S. stock market perform during the Fund's fiscal year?
A: Stocks performed very well during the past year, as continued global growth, favorable earnings results and improving corporate balance sheets combined to form a solid foundation for the market. While stocks provided a reasonable return, their upward path was very choppy due to weakness in the second and third quarters. During this time, the market was pressured by a litany of concerns that included geopolitical tensions, soaring oil prices and rising U.S. interest rates. Investors, therefore, began to rotate into higher-quality stocks with solid fundamentals, and away from the riskier stocks that had been top performers during 2003 and the first quarter of this year. This shift was a positive for the Fund, given our focus on higher quality, fundamentally sound companies.
Q: How did Pioneer Oak Ridge Large Cap Growth Fund perform?
A: Class A shares of the Fund produced a total return of 11.90% at net asset value for the twelve-month period ended November 30, 2004, outpacing the 5.83% return of the Russell 1000 Growth Index. The Fund's Class A shares finished in the top 7% of the 647 funds in the Lipper Large Cap Growth Funds peer group for the one-year period. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. We are pleased that the Fund has performed well both on an absolute basis and relative to its benchmark and peer group. While past performance is no guarantee of future results, of course, we believe the Fund's strong showing is the result of our disciplined investment style. Like all growth managers, we look for companies with accelerating earnings. However, we also require that two other important factors be in place. First, our research must indicate to us that an issue's earnings growth is sustainable. And second, the stocks we purchase must be reasonably valued in our view, since even fast-growing stocks can be very risky if they are purchased at too rich of a price. We believe this approach is the best way to find companies that are poised to perform well over a three- to five-year time horizon.
Q: How is the Fund positioned in the two largest industry sectors in the Russell 1000 Growth Index: technology and health care?
A: We added significant relative value through our approach to the technology sector, which underperformed the general market due to the prospect of slowing sales growth in 2005. In this environment, our relatively conservative positioning - i.e., our focus on reasonably valued, blue chip companies within the sector - paid off. In addition, performance was helped by the fact that technology is the Fund's largest sector underweight (a weighting below that of the benchmark). Two of the Fund's top performers in technology were Qualcomm, whose business model of earning royalties for its wireless communications technology has enabled the stock to perform well amid broader tech weakness; and Dell Computer, which continues to gain market share from its competitors. The portfolio also was helped by being underweight in the more cyclical areas within technology, such as semiconductors. In particular, our decision to avoid Intel - which underperformed by a wide margin during the period - proved to be a distinct positive for performance. Turning to health care, we added significant value through our decision to avoid the large-cap pharmaceuticals sector. Although these stocks are now as inexpensive as they were following President Clinton's attempt at sweeping health care reform in 1993, we believe there are not enough new drugs in the pipeline to make up for the lost revenues from drugs that are coming off patent protection. We looked instead for opportunities among service providers and equipment companies, such as Zimmer Holdings - a leading manufacturer of orthopedic products. Zimmer declined in the third quarter on weaker than expected earnings, prompting us to trim the position, but the stock was a strong contributor for the full year. On the negative side, the generic drug maker Teva Pharmaceuticals was one of the Fund's leading detractors. We continue to hold the stock, however, as we remain confident in its longer term prospects.
Q: What other elements of the Fund's positioning affected performance?
A: Energy stocks performed very well during the period, as the rising prices of oil and gas boosted profits for companies in the sector. The Fund was helped by both an overweight position and strong stock selection within the group. We received strong performance from XTO Energy, which has demonstrated the ability to manage its business effectively even during difficult times. Apache, an exploration and production company that reported record production and 57% earnings growth during the third quarter, also performed very well for the Fund. In the consumer discretionary area, the online auction company eBay provided stellar performance. eBay has emerged as a true "category killer," meaning that there is no other company that has come close to being able to establish a stronghold in its market space. While the company's fundamentals remain strong, we have begun to trim the position on the basis of its valuation. Specialty retailers such as Staples and Best Buy also contributed positively to performance. A key detractor within the consumer discretionary group was IAC/InteractiveCorp, which integrates a variety of online businesses. While we believed this would allow the company to benefit from increased online activity, the stock fell following the release of disappointing second quarter results. In the financial sector, we have gradually reduced the presence of companies that are sensitive to interest rate movements - such as traditional banks - given that the Federal Reserve is likely to continue raising rates. At the same time, we have maintained the Fund's positions in stocks with more diversified business lines that have the potential to benefit from continued strength in the economy, such as Sallie Mae and American Express. A top performer among financials was Popular, which holds a strong market position within Latin America and the fast-growing Hispanic population in the United States.
Q: What is your outlook for the stock market?
A: There are a number of factors that continue to work in the market's favor, including steady worldwide growth, the improvement in corporate balance sheets and companies' growing focus on dividends and share buybacks. However, the risks to market performance, which include rising interest rates and the potential for geopolitical disruptions, remain firmly in place. As a result, we think the post-bubble rally in lower-quality, higher-risk companies has likely run its course, and this should translate into a continued investor preference for higher quality companies with strong fundamentals. In this environment, we believe we can continue to add value through our disciplined, selective approach to investing. The Fund invests in a limited number of securities and, as a result, the Fund's performance may be more volatile than the performance of funds holding more securities.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Fund
Performance Update 12/31/04 Class A Shares
Shares Prices and Distributions
Net Asset Value per Share 12/31/04 12/31/03
$42.06 $38.00
Distributions per Share
(1/1/04 - 12/31/04)
Income Dividends $0.3363
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
INVESTMENT RETURNS
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Fund at public offering price, compared to that of the Standard & Poor's (S&P) 500 Index.
Average Annual Total Returns (As of December 31, 2004) Period Net Asset Value Public Offering Price (POP) Life-of-Class 10 Years 11.95% 11.21% 5 Years -0.27 -1.44 1 Year 11.64 5.21 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Standard & Poor's 500 Index is a commonly used measure of the broad U.S. stock market. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in any Index.
Performance Update 12/31/04 Class B Shares Share Prices and Distributions
Performance Update 11/30/04 Class B Shares
Net Asset Value per Share 12/31/04 12/31/03
$41.15 $37.18
|
Distributions per Share (1/1/04 - 12/31/04) Income Dividends $ -- Short-Term Capital Gains $ -- Long-Term Capital Gains $ -- |
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Fund, compared to that of the Standard & Poor's (S&P) 500 Index.
Average Annual Total Returns (As of December 31, 2004) Period If Held If Redeemed Life-of-Class (7/1/99) 9.04% 9.04% 5 Years -1.14 -1.14 1 Year 10.68 6.68 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CDSC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares.
All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Standard & Poor's 500 Index is a commonly used measure of the broad U.S. stock market. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in any Index.
Performance Updates 12/31/04 Class Y Shares
Share Prices and Distribution
Net Asset Value per Share 12/31/04 12/31/02
$42.16 $38.09
Distributions per Share
(1/1/04 - 12/31/04)
Income Dividends $0.5142
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Fund, compared to that of the Standard & Poor's (S&P) 500 Index.
Average Annual Total Returns (As of December 31, 2004) Period If Held If Redeemed Life-of-Class 10 Years 12.22% 12.22% 5 Years 0.16 0.16 1 Year 12.15 12.15 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Performance for periods prior to the inception of Y shares reflects the NAV performance of the Fund's A shares. The performance does not reflect differences in expenses, including the Rule 12b-1 fees applicable to A shares. Since fees for A shares are generally higher than those of Y shares, the performance shown for Y shares prior to their inception (5/6/99) would have been higher. Class A shares are used as a proxy from 2/13/ 1928 to 5/6/99. Class Y shares are not subject to sales charges and are available for limited groups of eligible investors, including institutional investors. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Standard & Poor's 500 Index is a commonly used measure of the broad U.S. stock market. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in any Index.
Portfolio Management Discussion 12/31/04
In the following discussion, John Carey, portfolio manager of Pioneer Fund, reviews the past year and gives an overview of Pioneer Fund's performance over that period.
Q: How did the Fund perform versus its benchmark and peer group? To what do you attribute the performance?
A: Pioneer Fund achieved respectable returns in 2004. Class A shares rose 11.64%, at net asset value for the calendar year. Most of the gain came in the fourth quarter, which saw the Class A shares rise 9.69%. By comparison, the Standard & Poor's (S&P) 500 Index, an unmanaged index of the general stock market, increased by 11.04% for the year and 9.23% in the fourth quarter, and the average fund in the Lipper Large-Cap Core category appreciated by 7.79% for the year and 8.86% in the fourth quarter. For the second half of 2004, the corresponding numbers were: +9.41% at net asset value for Pioneer Fund; +7.19% for the S&P 500 Index; and +5.64% for the average fund in the Lipper Large- Cap Core category. After a halting start to the year in the first half, the market performed well in the second half, and Pioneer Fund more than kept pace. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Looking back at our June 30 shareholder letter, we read our description of a market apparently in disarray, but with some discernible trends. Principally we noted the disappointing performance of some of the market darlings of the previous year, 2003, especially in technology, as investors during 2004 rotated into more moderately priced shares with dividends and more stable earnings. While it looked as though investors did not know what to do amidst all of their worries about rising interest rates, the war in Iraq, the weak dollar, rising oil prices, terrorist threats, and the upcoming Presidential election, they did in fact have a pretty clear idea. Seeking
security in dividends and modest valuations, and also in companies likely to benefit from some of the circumstances causing their worries, investors heavily bought and drove up the prices of energy, utility, industrial, and materials stocks. The fourth-quarter rally broadened somewhat towards the end of the year, but overall, 2004 was distinctly the year of the "old economy." Many of the best-performing stocks were in industries like coal, copper, and iron-ore mining, oil and gas, railroads, steel, hotels and lodging, building materials, machinery, home construction, and ocean shipping. Our founder, Philip Carret, would have been quite comfortable in the market of 2004 because without exception all of those industries also existed, and were prospering, in the year of his birth, 1896. For Pioneer Fund, the better-than-average performance was derived both from our solid weightings in many of the old-economy stocks, especially in energy, industrials, and materials, and from our good stock selection in the four sectors that underperformed the S&P 500 average, consumer staples, financials, health care, and information technology. Among our best-performing stocks were Norfolk Southern and PACCAR in industrials and T. Rowe Price in financials, but we also benefited from having only modest relative exposure to Pfizer and Cisco Systems (which we sold during the year) and no holdings of Coca-Cola, all stocks that did poorly. We did suffer from having above-market weightings in two of the dismal semiconductor names, Applied Materials and Texas Instruments, but on the whole we managed to avoid most of the "disaster" stocks. We were particularly pleased that consumer discretionary, the sector we had highlighted in our annual report for 2003 as the "major culprit" in our relative underperformance versus the S&P during that year, was a positive contributor to Fund performance in 2004. Three of our largest gains were from stocks in that sector: McGraw-Hill, Target, and John Wiley & Sons.
Q: What changes did you make to the portfolio during the second half?
A: The list of 32 additions to and 10 deletions from the portfolio in the second half of 2004 makes it look as though the period was a singularly busy one for Pioneer Fund. Actually it was just a normally busy time, but due to the merger of an acquired fund, the Safeco Core Equity Fund, into Pioneer Fund during December, we ended up with some 20 new, transferred positions. Most of the Safeco fund, totaling about $700 million in assets, overlapped with positions already owned in Pioneer Fund, but we inherited the others as well. Rather than "throwing them all out with the wash," we thought that we would take our time to study them in the expectation that some might prove to be worthwhile longer-term holdings for Pioneer Fund. The merger itself marked an exciting increase to the asset base of Pioneer Fund, and also to our shareholder family. To our new, formerly Safeco fund shareholders, a hearty welcome! The total effect of the portfolio activity on sector weights was modest, with no sector weighting going up or down by as much as 2%. Materials, industrials, consumer discretionary, information technology, and telecommunications services all increased as a percentage of the Fund portfolio, and energy, consumer staples, health care, financials, and utilities all decreased. As examples, in materials we added: BHP Billiton, a major Australian-based mining and minerals company; Inco, the Canadian nickel producer; and Newmont Mining, a leading gold miner. Two new materials names came from the Safeco fund, Praxair, supplier of industrial gases, and Ball, a packaging company. Among industrials, Northrup Grumman and Ingersoll-Rand were both Safeco holdings, and in the case of consumer discretionary, five of the eight new stocks came from the Safeco fund. The two largest additions, however, were our own purchases, Nordstrom and Gap, both of them retailing companies showing signs of meaningful operational improvement over the past couple of years. Information technology rose somewhat with: our purchase of Veritas Software, which has received a merger proposal from another portfolio company, Symantec; the receipt of shares of Freescale Semiconductor from our holding Motorola; and the inclusion of EMC, an information storage specialist, from the Safeco fund. Telecommunications saw one purchase by us, Nextel Communications, and two additions attributable to the Safeco fund, CenturyTel and Verizon. Subsequent to our purchase of Nextel, the company entered into merger discussions with Sprint. In regard to the sectors where the weightings decreased, the reasons in some cases had to do with weaker relative share-price performance and in other cases with sales from the portfolio. In energy, we realized a gain on a large position in Smith International and replaced it with a smaller holding of Schlumberger. With consumer staples, despite the addition of two small positions from the Safeco portfolio, Kellogg and Kimberly Clark, the sector declined as a percent of the Fund due to underperformance versus the market averages. In the case of health care, it was a combination of selling in excess of purchasing and woeful stock performance from some of the pharmaceuticals, especially Mylan Labs, which announced an acquisition that many investors thought ill conceived. During the six months, we realized significant percentage gains on our sales of Biomet and Wellpoint Health Networks, while adding two names in the health-care equipment and supplies industry, Stryker and Medtronic, and one name in biotechnology, Amgen. Medtronic and Amgen were both from the Safeco fund. Financials saw SouthTrust stock exchanged for shares of Wachovia in a merger and our shares of Charter One Financial acquired for cash by the Royal Bank of Scotland. We sold our position in St. Paul Travelers after discouragement over the company's need to set up additional reserves following the merger creating the company. Finally, in utilities, we sold a position in Vectren and received a smaller position in Exelon from the Safeco fund. We have not listed every change, but rather have mentioned the more significant ones and summarized the impact on the portfolio.
Q: What is your outlook for 2005?
A: The economic outlook appears favorable over the coming year. Interest rates are expected to continue rising, but not so fast that they should present impediments to further economic growth.
Earnings growth will moderate somewhat, which is normal as a business cycle lengthens, but should still be adequate to fuel additional share-price advances. Federal tax law, with the maximum 15% tax rate on qualified dividends and long-term capital gains, is likewise favorable to the stock market. Of course there are concerns, including energy and other commodity prices and the high trade and Federal budget deficits. At some point, too, investors will begin looking ahead to the next downturn in the economy and thinking about ways to position themselves more defensively. A lot rides on the length of the current business cycle. That is, will this be a "normal" cycle of four years or thereabouts, or could it become another extended cycle like the one of the 1990s, which continued for more than six years? Making the forecasting even more difficult is the unusual circumstance that this is a wartime cycle, with some economic activity not conforming to more predictable business patterns. We are somewhat inclined to the view that this will be an extended cycle, due to the excruciatingly slow start to the recovery this time around and the persisting cautiousness of many corporate managements. There generally have to be signs of "excesses" before an economy rolls over, and we are not speaking of the recent $44 million apartment sale in New York City or the advertised pricing of some luxury cars above $300,000. Rather we are speaking of excessive hiring and capital spending, leading to unneeded productive capacity, unsellable inventory, and superfluous workers, and none of that has popped up yet at least on our radar screen. So we think that we have some reasonable amount of time ahead of us for making money in the market. As always, though, we are mainly interested in companies that have the financial and management strengths to survive and do well regardless of the economic climate, and especially companies with the potential, as well as a plan and the management commitment, to do better than they have in the past. A good economy creates more opportunities for such companies to achieve improved results.
Thank you very much for your interest and support.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Mid Cap Value Fund
Performance Update 10/31/04 Class A Shares
Share Price And Distributions
Net Asset Value per Share 10/31/04 10/31/03
$25.57 $22.25
Distributions per Share
(11/1/03 - 10/31/04)
Net Investment Income $ --
Short-Term Capital Gains $0.2084
Long-Term Capital Gains $0.3145
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Mid Cap Value Fund at public offering price, compared to that of the Russell Midcap Value Index.
Average Annual Total Returns (As of October 31, 2004) Period Net Asset Value Public Offering Price (POP) Life-of-Class 10 Years 11.44% 10.78% 5 Years 12.18 10.86 1 Year 17.65 10.87 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds and can be rescinded at any time. See the prospectus and financial statements for complete details.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Russell Midcap Value Index measures the performance of U.S. mid-cap value stocks. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Performance Update 10/31/04 Class B Shares
Net Asset Value per Share 10/31/04 10/31/03
$23.32 $20.48
Distributions per Share
(11/1/03 - 10/31/04)
|
Net Investment Income $ -- Short-Term Capital Gains $0.1778 Long-Term Capital Gains $0.3145 |
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Mid Cap Value Fund, compared to that of the Russell Midcap Value Index.
Average Annual Total Returns (As of October 31, 2004) Period If Held If Redeemed 10 Years 10.55% 12.22% 5 Years 11.25 11.12 1 Year 16.64 12.64 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect deduction of applicable contingent deferred sales charge (CDSC). The maximum CDSC is 4% and declines over six years. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds and can be rescinded at any time. See the prospectus and financial statements for complete details. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Russell Midcap Value Index measures the performance of U.S. mid-cap value stocks. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Performance Update 10/31/04 Class Y Shares
Share Price And Distributions
Net Asset Value per Share 10/31/04 10/31/03
$26.17 $22.73
Distributions per Share
(11/1/03 - 10/31/04)
Net Investment Income $ --
Short-Term Capital Gains $0.2913
Long-Term Capital Gains $0.3145
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Mid Cap Value Fund, compared to that of the Russell Midcap Value Index.
Period If Held If Redeemed 10 Years 11.79% 11.79% |
5 Years 12.73 12.73 1 Year 18.23 18.23 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Performance for periods prior to the inception of Y shares reflects the NAV performance of the Fund's A shares. The performance does not reflect differences in expenses, including the Rule 12b-1 fees applicable to A shares. Since fees for A shares are generally higher than those of Y shares, the performance shown for Y shares prior to their inception would have been higher. Class A shares are used as a proxy from 7/25/90 to 7/2/98. Class Y shares are not subject to sales charges and are available for limited groups of eligible investors, including institutional investors. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds and can be rescinded at any time. See the prospectus and financial statements for complete details.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
Index comparison begins 7/31/98. The Russell Midcap Value Index measures the performance of U.S. mid-cap value stocks. Index returns assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Portfolio Management Discussion 10/31/04
Investors reacted to a variety of different influences during the 12-month period ended October 31, 2004, but the dominant trend in the market was for stock prices to move higher as the economy expanded and corporate profits grew. During the period, mid-cap stocks tended to outperform both large-cap and small-cap stocks, and value stocks outperformed growth stocks. In the following discussion, Rod Wright, leader of the team that manages Pioneer Mid Cap Value Fund, provides an update on the Fund, its investment strategies and the economic environment during the 12-month period.
Q: How did the Fund perform?
A: The Fund did well, outperforming the average return of competitive funds despite trailing the benchmark Russell Midcap Value Index. The Fund's Class A shares had a total return of 17.65% for the 12 months ended October 31, 2004, while Class B and Class C shares returned 16.64% and 16.60%, respectively, all at net asset value. During the same period, the Russell Midcap Value Index gained 19.74%, while the average return of the 228 funds in Lipper's Mid-Cap Value category was 15.64%.
Q: What were the principal factors affecting Fund performance?
A: The market began the period, in the final quarter of calendar 2003, building on the rally that had characterized much of 2003, with stock prices rising amid expectations that the economy was entering a period of sustained economic growth. The surge continued through early spring of 2004, when investors began to be concerned about a host of other influences, including high stock valuations, the instability in Iraq, political uncertainty and rapidly rising oil prices. The combination of these concerns stalled the rally until late in the period, when prices again advanced amid renewed optimism about the strength of the economy. The Fund's selections in technology, energy, consumer discretionary and telecommunications services helped support strong performance, while investments in industrials and financial services tended to detract from performance. The underperformance of the Fund, relative to the Russell Midcap Value Index, was primarily due to the absence of any investments in real estate investment trusts (REITs), part of the financial services sector. The Fund's defensive positioning in the financial services sector also held back performance, as market interest rates did not increase by as much as we had anticipated and many banks and other interest rate sensitive companies continued to perform well.
Q: What were some of the individual investments that most influenced performance?
A: Foot Locker, a specialty retailer focusing on athletic apparel, was a major contributor to performance, as its earnings accelerated. Transocean, the world's largest offshore oil-drilling company, posted big gains, as world oil prices advanced, stimulating drilling activity. Phelps Dodge, the world's second largest copper mining company, was another major contributor, as the prices of copper and other basic materials climbed because of surging economic growth throughout the world. Foot Locker remained the Fund's largest single holding at the end of the fiscal year, while we also continued to hold both Transocean and Phelps Dodge. Other investments that added to returns include: NCR, which develops and produces electronic processing equipment; Becton, Dickinson, a medical products company, Occidental Petroleum, an integrated petroleum company; and Providian Financial, which specializes in credit cards. The Fund still owned these stocks at the period's end. Two holdings were the subjects of acquisitions at premiums to their stock valuations, significantly helping performance. Charter One Financial, which operates banks in nine Eastern and Midwestern states, was acquired by Citizens Financial, a subsidiary of the Royal Bank of Scotland. Apogent Technologies, which produces devices and equipment for clinical and research laboratories, was purchased by Fisher Scientific International.
Q: What were some of the investments that detracted from performance?
A: In addition to the Fund's defensive positioning in the financial services sector and lack of exposure to REITs, performance relative to the benchmark Russell Midcap Value Index was hurt by not owning several strongly performing stocks, notably TXU, a Texas based utility, and Apple Computer. Other investments that proved to be disappointments for the fiscal year included: PMI Group, an insurer of residential mortgages and Mattel, the toy company.
Q: What is your investment outlook?
A: We are reasonably optimistic about the economy and investment opportunities in the stock market. The economy is expanding at a healthy rate, job growth has begun to accelerate, interest rates remain low by historical standards, and inflation continues to be restrained. Stock valuations also appear to be reasonable, giving us the opportunity to find interesting investments. Although we expect to continue to de-emphasize the stocks of companies that may be vulnerable to rapid increases in interest rates, we are moderately bullish about the overall market.
Investing in mid-sized companies may offer the potential for higher returns, but these companies are also subject to greater short-term price fluctuations than larger, more established companies.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Growth Opportunities Fund
Performance Update 12/31/04 Class A Shares Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
$29.80 $24.38
Distributions per Share
(1/1/04 - 12/31/04)
Income Dividends $ --
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Growth Opportunities Fund at public offering price, compared to that of the Russell 2000 Index.
Average Annual Total Returns (As of December 31, 2004) Period Net Asset Value Public Offering Price (POP) Life-of-Class 9/30/96 12.53% 11.76% 5 Years 5.13 3.88 1 Year 22.23 15.1 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
The performance of each class of the Fund is the performance of the predecessor fund's Class A, Class B and Class C shares, which has been restated to reflect differences in any applicable sales charges (but not differences in expenses). If all the expenses of the Pioneer fund were reflected, the performance would be lower.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds and can be rescinded at any time. See the prospectus and financial statements for complete details. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Russell 2000 Index measures U.S. small-cap stocks. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, charges or expenses. You cannot invest directly in the index.
Performance Update Class B Shares
Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
$27.94 $23.05
|
Distributions per Share
(1/1/04 - 12/31/04) Income Dividends $ -- Short-Term Capital Gains $ -- Long-Term Capital Gains $ -- |
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Growth Opportunities Fund, compared to that of the Russell 2000 Index.
Period If Held If Redeemed Life-of Class (9/30/96) 11.67% 11.67% 5 Years 4.36 4.36 1 Year 21.21 17.21 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
"If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CDSC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
The performance of each class of the Fund is the performance of the predecessor fund's Class A, Class B and Class C shares, which has been restated to reflect differences in any applicable sales charges (but not differences in expenses). If all the expenses of the Pioneer fund were reflected, the performance would be lower. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds and can be rescinded at any time. See the prospectus and financial statements for complete details.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Russell 2000 Index measures U.S. small-cap stocks. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, charges or expenses. You cannot invest directly in the index.
Portfolio Management Discussion 12/31/04
In the following interview, Michael Rega and Diego Franzin, co-managers of Pioneer Growth Opportunities Fund, discuss the factors that influenced performance for the twelve months ended December 31, 2004. The current portfolio team assumed the Fund's management duties on December 10, 2004.
Q: What factors affected the performance of U.S. equities during the past year?
A: The stock market performed very well in 2004, despite a potentially challenging environment. Investors had to contend with a host of obstacles throughout the year, including a sharp increase in oil prices, rising short-term interest rates, the uncertainty associated with the U.S. presidential election and the ongoing insurgency in Iraq. Nevertheless, the market remained well supported by its strong underlying fundamentals. The economy continued to grow at a steady pace, but not so fast that the Federal Reserve felt compelled to accelerate its measured pace of rate increases. Corporate earnings also remained robust, finishing the year at a much higher level than most analysts had anticipated. Strong earnings, in turn, translated to increased dividends and a continued improvement in corporate balance sheets. Taken together, those factors helped the stock
market climb the "wall of worry" and post a double-digit gain for the year. Amid
this generally positive environment, small-cap stocks outperformed their
large-cap counterparts by a wide margin, reflecting the superior earnings growth
of companies in the asset class. Within small-caps, value outperformed growth:
for the year, the Russell 2000 Value Index returned 22.25% versus 14.31% for the
Russell 2000 Growth Index. Given the Fund's focus on reasonably valued small-
and medium-sized companies, the strong returns within those market segments
provided a favorable tailwind to performance.
Q: How did the Fund perform in relation to its benchmark and peer group?
A: Class A shares of the Fund produced a total return of 22.23% at net asset value during the twelve-month period ended December 31, 2004, compared to a return of 18.33% for its benchmark, the Russell 2000 Index. The Fund also outperformed the 18.38% average return of the 556 funds in the Lipper Small-Cap Core category, finishing in the top quarter of the group.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Q: As new managers of the Fund, what changes do you anticipate making to the portfolio and its overall investment style?
A: We do not plan to do a major rebalancing of the portfolio, but we expect to make a series of gradual changes to the Fund throughout the year as market conditions warrant. First, we intend to bring greater diversification to the portfolio by owning more stocks and taking smaller positions in individual names. Second, we plan to keep the Fund sector neutral, meaning that its industry weightings will usually be very closely in line with those of the benchmark index. In this way, the majority of the Fund's performance will be the result of individual stock selection. We believe we can add more value through company research than by attempting to predict the direction of the overall market or the relative performance of specific industries.
Q: How do you intend to select stocks for the Fund?
A: We start by dividing the Russell 2000 Index into a number of distinct sectors and subsectors, then we use a disciplined stock selection model to identify the most attractive stocks in each sector based on four factors: growth, quality, valuation and momentum. That enables us to analyze the entire universe of 2,000 companies and select what our criteria show to be the top 20% in each sector. Next, we focus our research capabilities to conduct a fundamental analysis of each stock that has been selected. We believe that the approach provides both breadth and depth to our stock picking. We believe that this investment style will provide more stability to the portfolio and reduce the extent of the variation in its return with respect to the benchmark index. Our goal is not to hit home runs, but to hit singles and doubles and, in the process, try to deliver market-beating returns on a long-term basis. MANAGEMENT DISCUSSION 12/31/04 (continued)
Q: What is your overall view of the market at this juncture?
A: We believe a focus on individual stock selection will be critical in the year ahead. Small-caps have outperformed large-caps for six years in a row, which suggests that a change in market-cap leaders may be in order. What's more, our analysis shows that on a historical basis, growth stocks have been this inexpensive in relation to value less than 5% of the time. This has two implications: first, it means that gains in the small-cap value area are not likely to come as easily as they did in 2004. As a result, fundamental research should play a very important role in generating outperformance. Second, it means that in assessing the outlook for individual stocks, we will place a higher than normal emphasis on companies with the most attractive growth characteristics. We believe these steps will help the Fund effectively navigate the year ahead even in the event that the stellar relative performance of the small-cap value asset class begins to cool off.
Q: In what areas are you finding the best investment opportunities?
A: In 2004, every major sector in the Russell 2000 Index provided double-digit returns with the exception of technology. We expect a greater dispersion of returns in 2005, which again would work to our advantage as individual stock pickers. We will be looking for opportunities in technology and health care, two areas that underperformed the broad-based index during 2004. One of the Fund's top holding, MICROS Systems, is a tech stock that in our view is among those that have additional upside. MICROS develops and markets software applications to the hospitality industry, mostly table service restaurants. Their software allows restaurants to improve coordination between servers and kitchen staff and reduce costs by improving inventory
management and product reordering. A key driver of future growth is expansion into the hotel industry as the industry embarks on a 5- to 7-year technology infrastructure upgrade cycle. Within health care, we will be closely looking for opportunities in the biotechnology sector. We believe biotechs are less risky than in the past, since there are more companies that have been public for four or five years and, therefore, have a longer earnings history and more experienced management teams. We will look to capitalize on companies we identify as quality managed and staffed, along with a proven record of execution. On the other side of the coin, we find the consumer staples and real estate areas to be less compelling. And within financials, we intend to focus on companies that have an asset/liability mix that favors a flattening yield curve environment and exposure to expanding markets such as Florida and Texas.
Q: Do you have any final thoughts for investors?
A: We believe that the most important aspect of asset management is individual stock selection, and we will remain committed to our research-driven approach. Regardless of the direction of the overall market, we believe Fund shareholders have the potential to benefit from our efforts to identify the highest-quality small-cap stocks in the market. By concentrating on one industry or on a group of related industries, the portfolio is more susceptible to adverse economic, political or regulatory developments affecting those industries than is a portfolio that invests more broadly. Investing in foreign and/or emerging markets securities involves risks relating to interest rates, currency exchange rates, economic, and political conditions. Investing in small companies may offer the potential for higher returns, but these companies are also subject to greater short-term price fluctuations than larger, more established companies.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Ibbotson Aggressive Allocation Fund
Performance Update 1/31/05 Class A Shares
Share Price And Distributions
Net Asset Value per Share 1/31/05 8/9/04
$11.07 $10.00
Distributions per Share
(8/9/04 - 1/31/05)
Dividends $0.0218
Short-Term Capital Gains $ --
Long-Term Capital Gains $0.2979 $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Ibbotson Aggressive Allocation Fund at public offering price, compared to that of the Standard & Poor's 500 Stock Index.
Average Annual Total Returns (As of January 31, 2005) Period Net Asset Value Public Offering Price (POP) Life-of-Class (8/9/04) 13.54% 7.02% |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Standard & Poor's 500 Stock Index (the S&P 500) is a commonly used measure of the broad U.S. stock market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Performance Update 1/31/05 Class B Shares
Share Price And Distributions
Net Asset Value per Share 1/31/05 8/9/04
$10.68 $10.00
Distributions per Share
(8/9/04 - 1/31/05)
Dividends $ --
Short-Term Capital Gains $ --
Long-Term Capital Gains $0.2979
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Ibbotson Aggressive Allocation Fund, compared to that of the Standard & Poor's 500 Stock Index.
Average Annual Total Returns (As of January 31, 2005) Period If Held If Redeemed Life-of-Class (8/9/04) 9.73% 5.73% |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CSDC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares.
All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Standard & Poor's 500 Stock Index (the S&P 500) is a commonly used measure of the broad U.S. stock market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Portfolio Management Discussion 1/31/05
In the following interview, portfolio manager Peng Chen, Chief Investment Officer for Ibbotson Associates, discusses the market environment and investment strategies that applied to the three portfolios in the Pioneer Ibbotson Allocation Series for the period of almost six months since they began operations on August 9, 2004.
Q: Could you characterize the economic backdrop against which the three portfolios began investment operations?
A: The period of nearly six months between the August 9, 2004 launch of the funds and the end of January 2005 was an uncertain environment for investors. While the U.S. economy has continued the growth trend that started in the second half of 2003, the rate of growth has showed signs of decelerating. At the same time, inflation continues to be a concern, spurred on by the continued strength in the economy and, to a lesser extent, by oil prices that have been at all-time highs. On the interest rate front, the Federal Reserve began to raise short-term rates earlier in 2004 and appears to be maintaining a tightening policy to keep economic growth in check.
Q: How did the financial markets respond in this climate?
A: Early in the period, equity market levels wavered while basically staying within a range. As the November 2 date for the U.S. presidential election drew closer, however, investors became increasingly focused on the accompanying uncertainties, and
stocks fell. In contrast, bond prices generally showed strength during this time. The trends appeared to reverse themselves in the aftermath of the election. The stock market responded positively to the increased clarity, while bond market performance was dampened by expectations of a continued lack of progress on reducing federal budget deficits.
Q: What were the strategic considerations that you applied to the three portfolios in allocating assets?
A: As the three portfolios in the series were launched and initial investor dollars were received, assets were invested in keeping with the respective broad asset allocation and specific mutual fund targets established prior to the launch of the series. Toward the, middle of the period, in late October, we implemented two strategic changes across all three portfolios. First, within the U.S. stock portion of the portfolios, we implemented a moderate emphasis on value stocks and a corresponding underweighting of more growth-oriented investments. We did this because we believe the U.S. economy has entered into a decelerating growth cycle that should favor value equities with relatively stable earnings prospects. We also believe that the potential for higher inflation and interest rates favors the value investment style over growth. Our equity valuation and momentum models further support this assessment, indicating an overweighting of value and an underweighting of growth equities. That said, value stocks have now outperformed growth over a period of more than four years. If the economy starts to show signs of more rapid growth, an overweighting of more growth-oriented investments will be warranted. With respect to the other equity asset classes, the portfolios' targeted exposure across large-, mid-, and small-cap equities remained unchanged. We have also maintained neutral target weightings in the non-U.S. equity market alternatives, both developed and emerging. The other shift has been within the bond portion of the portfolios, where we implemented an underweighting of the long-term bond vehicle, with the difference allocated to the shorter-term fixed income alternative. We believe that, given the prospect of higher interest rates across all maturities, but especially on the long end of the yield curve, shorter duration fixed-income investments are more attractive. Elsewhere within fixed-income, we have maintained neutral positions in the high yield bond offering, as well as in the non-U.S. fixed-income option. Going forward, we will closely monitor economic indicators and interest rate movements to evaluate whether we need to make any adjustments to the views underlying these allocations. Given the significant level of uncertainty that continues to impact the financial markets, we believe that maintaining appropriate diversification across asset classes will be especially important in the months ahead.
Please the see the Portfolio Reviews beginning on page 10 for information on specific weightings and performance for each of the three portfolios in the Pioneer Ibbotson Asset Allocation Series. Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Ibbotson Growth Allocation Fund
Performance Update 1/31/05 Class A Shares
Share Price And Distributions
Net Asset Value per Share 1/31/05 8/9/04
$10.84 $10.00
Distributions per Share
(8/9/04 - 1/31/05)
Dividends $0.0342
Short-Term Capital Gains $ --
Long-Term Capital Gains $0.249
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Ibbotson Growth Allocation Fund at public offering price, compared to that of the Standard & Poor's 500 Stock Index.
Average Annual Total Returns (As of January 31, 2005) Period Net Asset Value Public Offering Price (POP) Life-of-Class (8/9/04) 11.19% 4.80% |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Standard & Poor's 500 Stock Index (the S&P 500) is a commonly used measure of the broad U.S. stock market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Performance Update 1/31/05 Class B Shares
Share Price And Distributions
Net Asset Value per Share 1/31/05 8/9/04
$ 9.95 $10.00
Distributions per Share
(8/9/04 - 1/31/05)
Dividends $ --
Short-Term Capital Gains $ --
Long-Term Capital Gains $0.249
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Ibbotson Growth Allocation Fund, compared to that of the Standard & Poor's 500 Stock Index.
Period If Held If Redeemed Life-of-Class (8/9/04) 1.95% -2.03% |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CSDC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares.
All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Standard & Poor's 500 Stock Index (the S&P 500) is a commonly used measure of the broad U.S. stock market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Portfolio Management Discussion 1/31/05
In the following interview, portfolio manager Peng Chen, Chief Investment Officer for Ibbotson Associates, discusses the market environment and investment strategies that applied to the three portfolios in the Pioneer Ibbotson Allocation Series for the period of almost six months since they began operations on August 9, 2004.
Q: Could you characterize the economic backdrop against which the three portfolios began investment operations?
A: The period of nearly six months between the August 9, 2004 launch of the funds and the end of January 2005 was an uncertain environment for investors. While the U.S. economy has continued the growth trend that started in the second half of 2003, the rate of growth has showed signs of decelerating. At the same time, inflation continues to be a concern, spurred on by the continued strength in the economy and, to a lesser extent, by oil prices that have been at all-time highs. On the interest rate front, the Federal Reserve began to raise short-term rates earlier in 2004 and appears to be maintaining a tightening policy to keep economic growth in check.
Q: How did the financial markets respond in this climate?
A: Early in the period, equity market levels wavered while basically staying within a range. As the November 2 date for the U.S. presidential election drew closer, however, investors became increasingly focused on the accompanying uncertainties, and
stocks fell. In contrast, bond prices generally showed strength during this time. The trends appeared to reverse themselves in the aftermath of the election. The stock market responded positively to the increased clarity, while bond market performance was dampened by expectations of a continued lack of progress on reducing federal budget deficits.
Q: What were the strategic considerations that you applied to the three portfolios in allocating assets?
A: As the three portfolios in the series were launched and initial investor dollars were received, assets were invested in keeping with the respective broad asset allocation and specific mutual fund targets established prior to the launch of the series. Toward the, middle of the period, in late October, we implemented two strategic changes across all three portfolios.
First, within the U.S. stock portion of the portfolios, we implemented a moderate emphasis on value stocks and a corresponding underweighting of more growth-oriented investments. We did this because we believe the U.S. economy has entered into a decelerating growth cycle that should favor value equities with relatively stable earnings prospects. We also believe that the potential for higher inflation and interest rates favors the value investment style over growth. Our equity valuation and momentum models further support this assessment, indicating an overweighting of value and an underweighting of growth equities. That said, value stocks have now outperformed growth over a period of more than four years. If the economy starts to show signs of more rapid growth, an overweighting of more growth-oriented investments will be warranted. With respect to the other equity asset classes, the portfolios' targeted exposure across large-, mid-, and small-cap equities remained unchanged. We have also maintained neutral target weightings in the non-U.S. equity market alternatives, both developed and emerging. The other shift has been within the bond portion of the portfolios, where we implemented an underweighting of the long-term bond vehicle, with the difference allocated to the shorter-term fixed income alternative. We believe that, given the prospect of higher interest rates across all maturities, but especially on the long end of the yield curve, shorter duration fixed-income investments are more attractive. Elsewhere within fixed-income, we have maintained neutral positions in the high yield bond offering, as well as in the non-U.S. fixed-income option. Going forward, we will closely monitor economic indicators and interest rate movements to evaluate whether we need to make any adjustments to the views underlying these allocations. Given the significant level of uncertainty that continues to impact the financial markets, we believe that maintaining appropriate diversification across asset classes will be especially important in the months ahead.
Please the see the Portfolio Reviews beginning on page 10 for information on specific weightings and performance for each of the three portfolios in the Pioneer Ibbotson Asset Allocation Series. Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Ibbotson Moderate Allocation Fund
Performance Update 1/30/05 Class A Shares
Share Price And Distributions
Net Asset Value per Share 1/31/05 8/9/04
$10.63 $10.00
Distributions per Share
(8/9/04 - 1/31/05)
Dividends $0.0433
Short-Term Capital Gains $ --
Long-Term Capital Gains $0.2339
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Ibbotson Moderate Allocation Fund at public offering price, compared to that of the Standard & Poor's 500 Stock Index.
Average Annual Total Returns (As of January 31, 2005) Period Net Asset Value Public Offering Price (POP) Life-of-Class (8/9/04) 9.04% 2.77% |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information. The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Standard & Poor's 500 Stock Index (the S&P 500) is a commonly used measure of the broad U.S. stock market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Performance Update 1/30/05 Class B Shares
Share Prices and Distributions
Net Asset Value per Share 1/31/05 8/9/04
$10.32 $10.00
Distributions per Share
(8/9/04 - 1/31/05)
Dividends $ --
Short-Term Capital Gains $ --
Long-Term Capital Gains $0.2339
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Ibbotson Moderate Allocation Fund, compared to that of the Standard & Poor's 500 Stock Index.
Average Annual Total Returns (As of January 31, 2005) Period If Held If Redeemed Life-of-Class (8/9/04) 5.51% 1.51% |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CSDC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Standard & Poor's 500 Stock Index (the S&P 500) is a commonly used measure of the broad U.S. stock market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index.
Portfolio Management Discussion 1/31/05
In the following interview, portfolio manager Peng Chen, Chief Investment Officer for Ibbotson Associates, discusses the market environment and investment strategies that applied to the three portfolios in the Pioneer Ibbotson Allocation Series for the period of almost six months since they began operations on August 9, 2004.
Q: Could you characterize the economic backdrop against which the three portfolios began investment operations?
A: The period of nearly six months between the August 9, 2004 launch of the funds and the end of January 2005 was an uncertain environment for investors. While the U.S. economy has continued the growth trend that started in the second half of 2003, the rate of growth has showed signs of decelerating. At the same time, inflation continues to be a concern, spurred on by the continued strength in the economy and, to a lesser extent, by oil prices that have been at all-time highs. On the interest rate front, the Federal Reserve began to raise short-term rates earlier in 2004 and appears to be maintaining a tightening policy to keep economic growth in check.
Q: How did the financial markets respond in this climate?
A: Early in the period, equity market levels wavered while basically staying within a range. As the November 2 date for the U.S. presidential election drew closer, however, investors became increasingly focused on the accompanying uncertainties, and stocks fell. In contrast, bond prices generally showed strength during this time. The trends appeared to reverse themselves in the aftermath of the election. The stock market responded positively to the increased clarity, while bond market performance was dampened by expectations of a continued lack of progress on reducing federal budget deficits.
Q: What were the strategic considerations that you applied to the three portfolios in allocating assets?
A: As the three portfolios in the series were launched and initial investor dollars were received, assets were invested in keeping with the respective broad asset allocation and specific mutual fund targets established prior to the launch of the series. Toward the, middle of the period, in late October, we implemented two strategic changes across all three portfolios.
First, within the U.S. stock portion of the portfolios, we implemented a moderate emphasis on value stocks and a corresponding underweighting of more growth-oriented investments. We did this because we believe the U.S. economy has entered into a decelerating growth cycle that should favor value equities with relatively stable earnings prospects. We also believe that the potential for higher inflation and interest rates favors the value investment style over growth. Our equity valuation and momentum models further support this assessment, indicating an overweighting of value and an underweighting of growth equities. That said, value stocks have now outperformed growth over a period of more than four years. If the economy starts to show signs of more rapid growth, an overweighting of more growth-oriented investments will be warranted. With respect to the other equity asset classes, the portfolios' targeted exposure across large-, mid-, and small-cap equities remained unchanged. We have also maintained neutral target weightings in the non-U.S. equity market alternatives, both developed and emerging. The other shift has been within the bond portion of the portfolios, where we implemented an underweighting of the long-term bond vehicle, with the difference allocated to the shorter-term fixed income alternative. We believe that, given the prospect of higher interest rates across all maturities, but especially on the long end of the yield curve, shorter duration fixed-income investments are more attractive. Elsewhere within fixed-income, we have maintained neutral positions in the high yield bond offering, as well as in the non-U.S. fixed-income option.
Going forward, we will closely monitor economic indicators and interest rate movements to evaluate whether we need to make any adjustments to the views underlying these allocations. Given the significant level of uncertainty that continues to impact the financial markets, we believe that maintaining appropriate diversification across asset classes will be especially important in the months ahead.
Please the see the Portfolio Reviews beginning on page 10 for information on specific weightings and performance for each of the three portfolios in the Pioneer Ibbotson Asset Allocation Series. Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Bond Fund
Performance Update 12/31/04 Class A Shares
Share Price And Distributions
Net Asset Value per Share 12/31/04 6/30/04
$9.38 $9.18
Distributions per Share
(7/1/04 - 12/31/04)
Net Investment Income $0.2485
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Bond Fund at public offering price, compared to that of the Lehman Brothers Aggregate Bond Index.
Average Annual Total Returns (as of December 31, 2004) Period Net Asset Value Public Offering Price (POP) 10 Years 7.18% 6.69% 5 Years 7.86 6.86 1 Year 5.71 0.96 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
POP returns reflect deduction of maximum 5.75% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Lehman Brothers Aggregate Bond Index is a measure of the U.S. bond market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Indexes.
Performance Update 12/31/04 Class B Shares
Share Price And Distributions
Net Asset Value per Share 12/31/04 6/30/04
$9.34 $9.14
Distributions per Share
(7/1/04 - 12/31/04)
Net Investment Income $0.2084
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Bond Fund, compared to that of the Lehman Brothers Aggregate Bond Index.
Average Annual Total Returns (as of December 31, 2004) Period If Held If Redeemed 10 Years 6.30% 6.30% 5 Years 6.93 6.93 1 Year 4.82 0.82 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CSDC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares.
All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Lehman Brothers Aggregate Bond Index is a measure of the U.S. bond market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Indexes.
Performance Update 12/31/04 Class Y Shares Share Price And Distributions
Net Asset Value per Share 12/31/04 6/30/04
$9.32 $9.12
Distributions per Share
(7/1/04 - 12/31/04)
Net Investment Income $0.2715
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Bond Fund, compared to that of the Lehman Brothers Aggregate Bond Index.
Average Annual Total Returns (as of December 31, 2004) Period If Held If Redeemed 10 Years 7.34% 7.34% 5 Years 8.18 8.18 1 Year 6.35 6.35 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Performance for periods prior to the inception of Y shares reflects the NAV performance of the Fund's A shares. The performance does not reflect differences in expenses, including the Rule 12b-1 fees applicable to A shares. Since fees for A shares are generally higher than those of Y shares, the performance shown for Y shares prior to their inception would have been higher. Class A shares are used as a proxy from 10/31/78 to 9/20/01. Class Y shares are not subject to sales charges and are available for limited groups of eligible investors, including institutional investors. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Lehman Brothers Aggregate Bond Index is a measure of the U.S. bond market. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Indexes.
Portfolio Management Discussion 12/31/04
As the domestic economy showed evidence of a sustained recovery during the second half of 2004, the U.S. Federal Reserve continued to raise short-term interest rates gradually to contain the risk of inflation and keep the economy in check. The fixed-income market reacted favorably to the Fed's series of measured increases in the Fed funds rate, with the yields of longer-term Treasuries actually declining modestly. Meanwhile corporate bonds and mortgages continued to outperform Treasuries as investors sought out higher-yielding investments in an environment of low, by historical standards, interest rates. In the following discussion, Kenneth J. Taubes discusses the factors that influenced Pioneer Bond Fund's performance during the six months. Mr. Taubes, Director of Pioneer's Fixed Income Group, oversees the team responsible for daily management of the Fund.
Q: How did the Fund perform during six months ended December 31, 2004?
A: Pioneer Bond Fund performed well, outpacing its benchmark as well as the competitive funds average. For the six-month period, the Fund's Class A shares returned 4.92%, at net asset value. During the same six months, the Lehman Brothers Aggregate Bond Index returned 4.18%, while the average total return of the 224 funds in Lipper's Corporate Debt A-Rated Bond Fund category was also 4.18%. On December 31, 2004, the standardized 30-day SEC Yield on Class A shares was 4.00%. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Q: What factors affected Fund performance?
A: During a period in which investors sought out yield, the Fund held to its emphasis on sectors with yield advantages over Treasuries, corporate bonds and mortgage-backed securities. Both corporate bonds and mortgage securities outperformed Treasuries, with high-yield corporate securities turning in the best performance of all sectors of the domestic bond market. Despite rising short-term rates, the yields of longer maturity Treasuries were relatively stable, and investors sought out securities with yield advantages over Treasuries. Against a backdrop of a strengthening economy, corporations generated additional cash flow, which improved the overall credit quality of corporate securities and further encouraged investments in both high-yield and investment-grade corporate debt.
Our emphasis on high-yield and investment-grade corporate bonds as well as mortgage securities helped support Fund performance throughout the six months. At the end of the six-month period, about 55% of assets were invested in mortgage securities and about 40% were invested in corporate debt, including almost 15% high-yield bonds. We reduced our high-yield positions slightly in the final quarter of the year. As we did so, we increased our investments in mortgages, which offered yields competitive with investment-grade corporates but with higher quality. Overall average credit quality of the portfolio was raised slightly during the period from A to A+. Less significant but also helpful was our decision to keep the Fund's sensitivity to interest-rate changes -- as measured by duration -- either neutral or slightly longer than the benchmark Lehman Brothers Aggregate Bond Index. In an environment of stable to slightly-declining market interest rates, this strategy tended to benefit performance. On December 31, 2004, the Fund's average effective duration was a somewhat shorter 3.99 years.
Q: What were some of the individual holdings that most influenced portfolio performance?
A: Among the high-yield holdings that helped performance were the bonds of two steel companies: International Steel, which we sold to take profits before the period ended, and ISPAT Inland ULC, which were upgraded in credit rating after the company was acquired by a Dutch corporation. Other bonds which appreciated strongly in price were those of financial service corporates Allmerica Financial, E-Trade and Odyssey Re. Detracting from results were insurance company Provident, whose bond prices slipped amid controversy over the New York attorney general's investigation of industry practices, Toys "R" Us, which announced restructuring plans, and Intelsat, a satellite company that withdrew plans for an initial public stock offering.
Q: What is your investment outlook?
A: We anticipate that the Federal Reserve will continue to raise the Fed funds rate at a gradual pace during 2005. The fixed-income market already has anticipated, in current bond prices, a series of further increases that would bring the Fed funds rate from 2.25% to near 3.5% by the end of the year. We believe the market rates of longer-term and intermediate-term securities already are close to being fairly valued. As a result, we anticipate that the yield curve -- which measures the relationship between short-term and longer-term interest rates -- likely will flatten during the year as short-term rates move up. In general, valuations of corporate securities appear relatively high by historical standards, but they probably are justified given the strong economic fundamentals both in the United States and throughout the globe. Strengthening economies are now helping companies across all sectors, resulting in improved cash flows and corporate profits. In this environment, we think corporate bonds should perform well, consistent with their yield advantage over Treasuries. As a result, we will continue to look for opportunities in the corporate sector. However, we expect to also put greater emphasis on mortgage securities, which offer virtually the same yields as investment grade corporate debt but have the advantage of higher credit ratings.
Investments in high yield or lower-rated securities are subject to greater-than average risk. When interest rates rise, the prices of fixed income securities in the Fund will generally fall. Conversely, when interest rates fall the prices of fixed-income securities in the Fund will generally rise. The portfolio may invest in mortgage-backed securities, which during times of fluctuating interest rates may increase or decrease more than other fixed-income securities.
Mortgage-backed securities are also subject to pre-payments. Investments in the Fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Tax Free Income Fund
Performance Update 12/31/04 Class A Shares
Performance Update 12/31/04 Class A Shares Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
$11.67 $11.70
Distributions per Share
(1/1/04 - 12/31/04)
Net Investment Income $0.567
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment in Pioneer Tax Free Income Fund at public offering price, compared to that of the Lehman Brothers Municipal Bond Index.
Average Annual Total Returns (As of December 31, 2004) Period Net Asset Value Public Offering Price (POP) 10 Years 6.33% 5.88% 5 Years 6.64 5.66 1 Year 4.75 0.05 |
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. POP returns reflect deduction of maximum 4.5% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Lehman Brothers Municipal Bond Index is a broad measure of the municipal bond market. Bonds in the Index have a minimum credit rating of BBB, were part of at least a $50 million issuance made within the past five years and have a maturity of at least two years. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index. A portion of the Fund's income may be subject to the Alternative Minimum Tax (AMT) or state and local taxes.
Performance update 12/31/04 Class B Shares
Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
$11.57 $11.59
Distributions per Share
(1/1/04 - 12/31/04)
Dividends $0.4764
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Tax Free Income Fund, compared to that of the Lehman Brothers Municipal Bond Index.
Average Annual Total Returns (As of December 31, 2004) Period If Held If Redeemed Life-of-Class (4/28/95) 4.94% 4.94% 5 Years 5.84 5.84 1 Year 4.07 0.07 |
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CDSC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares.
All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Lehman Brothers Municipal Bond Index is a broad measure of the municipal bond market. Bonds in the Index have a minimum credit rating of BBB, were part of at least a $50 million issuance made within the past five years and have a maturity of at least two years. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index. A portion of the Fund's income may be subject to the Alternative Minimum Tax (AMT) or state and local taxes.
Performance Update 12/31/04 Class Y Shares
Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
$11.61 $11.64
Distributions per Share
(1/1/04 - 12/31/04)
Dividends $0.6085
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Tax Free Income Fund, compared to that of the Lehman Brothers Municipal Bond Index.
Average Annual Total Returns (As of December 31, 2004) Period If Held If Redeemed 10 Year 6.14% 6.14% 5 Year 6.26 6.26 1 Year 5.14 5.14 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Performance for periods prior to the inception of Y shares reflects the NAV performance of the Fund's A shares. The performance does not reflect differences in expenses, including the Rule 12b-1 fees applicable to A shares. Since fees for A shares are generally higher than those of Y shares, the performance shown for Y shares prior to their inception would have been higher. Class A Shares are used as a proxy from 11/18/77 to 2/28/02. Class Y shares are not subject to sales charges and are available for limited groups of eligible investors, including institutional investors. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares. The Lehman Brothers Municipal Bond Index is a broad measure of the municipal bond market. Bonds in the Index have a minimum credit rating of BBB, were part of at least a $50 million issuance made within the past five years and have a maturity of at least two years. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Index. A portion of the Fund's income may be subject to the Alternative Minimum Tax (AMT) or state and local taxes.
Portfolio Management Discussion 12/31/04
During a period when interest rates remained relatively low, Pioneer Tax Free Income Fund's exposure to investments in a variety of states and a diverse number of economic sectors provided an attractive level of tax-free income. In the following interview, David Eurkus, a member of Pioneer's Fixed Income Management Team, discusses some of the factors that had an impact on the municipal bond market and your Fund.
Q: How did the Fund perform?
A: For the 12-month period ended December 31, 2004, Pioneer Tax Free Income Fund's Class A shares produced a 4.75% total return at net asset value. The Fund's benchmark, the Lehman Brothers Municipal Bond Index, returned 4.48%, and the average return of the 297 funds in the Lipper General Municipal Debt Funds Category was 3.70%. Lipper is an independent monitor of mutual fund performance. The Fund's Class A shares generated a 30-day SEC tax-free yield of 3.88% on December 31, 2004. That translates into a taxable equivalent yield of 5.97%, based on the maximum federal income-tax rate of 35%. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares when redeemed, may be worth more or less than their original cost.
Q: What was the investment environment like during the period?
A: Early in the period, the strength of the economic rebound raised concerns that inflation and interest rates might rise. In this environment, there was a significant decline in the bond market, which pushed bond prices down and yields up. As the fiscal
year progressed, however, reports associated with the economy indicated that the rapid pace of growth had shifted to a slower but steady rate. Despite this slight softening in the economic expansion, the Federal Reserve began tightening monetary policy, boosting the Federal funds rate on five occasions, each time by 0.25%. By yearend, the Federal funds rate was 2.25%, up from 1.00% at the start of 2004. (The Federal funds rate is the rate banks charge each other for overnight loans.) Initially, the Fed's actions caused yields to move higher, but when it appeared that inflation was under control, the yield curve flattened. (The yield curve shows the relationship between bond yields and maturity lengths.) With a flatter yield curve, short-term yields moved higher and prices declined; and longer-term yields fell or remained stable, boosting bond prices.
Q: How did you manage the Fund in this environment?
A: We maintained a diverse portfolio with assets invested in 154 securities in 38 states. We continued to emphasize sectors that are vital to the growth of the U.S. economy. These sectors included health care/hospitals, housing, transportation, and power and energy, areas in which the underlying credit quality of the fixed-income securities tends to improve as the economy gets stronger. We also had a position in tobacco revenue bonds, which are investment-grade securities that are backed by the tobacco settlement money awarded to states. Most of the portfolio was invested in investment-grade securities, those rated BBB or better. However, about 10% was allocated to below investment-grade bonds, which had relatively high yields and which enhanced the Fund's income stream. At the end of the period, the Fund's overall quality rating was A+.
Q: What contributed most to performance?
A: As short-term interest rates went up, the portfolio benefited from the price appreciation that resulted from the declining yields on longer-term securities. In addition, the below investment-grade bonds in the portfolio helped boost the tax-free income and prices.
Q: What detracted from performance?
A: There were no significant detractors. Overall the portfolio was positioned for declining interest rates. Our duration could have been somewhat longer; however, it exceeded the duration of our benchmark, the Lehman Brothers Municipal Bond Index, and our peer group, the Lipper General Municipal Debt Funds Category. (Duration measures a bond's sensitivity to interest-rate changes. A shorter duration is helpful when interest rates rise, and a longer duration is usually an advantageous when interest rates decline.)
Q: What is your outlook for the next six months?
A: We believe that the economy is on a positive growth path and expect the Fed to continue making modest interest-rate hikes over the near term. Therefore, we expect short-term rates to move higher and long-term rates to remain stable or possibly decline. In this environment, income could become a larger component of performance.
A portion of income may be subject to state, federal, and/or alternative minimum tax. Capital gains, if any, are subject to a capital gains tax. A portion of income may be subject to state, federal, and/or alternative minimum tax. Capital gains, if any, are subject to a capital gains tax. When interest rates rise, the prices of fixed income securities in the fund will generally fall. Conversely, when interest rates fall the prices of fixed income securities in the fund will generally rise. If the Internal Revenue Service determines an issuer of a municipal security has not complied with applicable tax requirements, interest from the security could become taxable and the security could decline significantly in value. Investments in the fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations. Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer America Income Trust
Performance Update 12/31/04 Class A Shares
Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
$9.79 $9.95
Distributions per Share
(1/1/04 - 12/31/04)
Net Investment Income $0.4286
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer America Income Trust at public offering price, compared to that of the Lehman Brothers Government Bond Index and of the Lehman Brothers Fixed-Rate Mortgage-Backed Securities Index.
Average Annual Total Returns (As of December 31, 2004) Period Net Asset Value Public Offering Price (POP) 10 Years 6.24% 5.75% 5 Years 6.23 5.26 1 Year 2.77 -1.86 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
POP returns reflect deduction of maximum 4.50% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Trust distributions or the redemption of Trust shares. The Lehman Brothers Government Bond Index measures the performance of the U.S. government bond market. The Lehman Brothers Fixed-Rate Mortgage-Backed Securities Index is an unmanaged index including 15- and 30-year fixed rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC) and Federal National Mortgage Association (FNMA). Index returns assume reinvestment of dividends and, unlike Trust returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Indexes.
Performance Update 12/31/04 Class B Shares
Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
$9.74 $9.89
|
Distributions per Share (1/1/04 - 12/31/04) Net Investment Income $0.3452 Short-Term Capital Gains $ -- Long-Term Capital Gains $ -- |
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer America Income Trust, compared to that of the Lehman Brothers Government Bond Index and of the Lehman Brothers Fixed-Rate Mortgage-Backed Securities Index.
Average Annual Total Returns (As of December 31, 2004) Period If Held If Redeemed 10 Years 5.41% 5.41% 5 Years 5.37 5.37 1 Year 2.02 -1.92 |
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost. "If redeemed" returns reflect the deduction of applicable contingent deferred sales charge (CSDC). Effective December 1, 2004, the period during which a CDSC is applied to withdrawals was shortened to 5 years. The maximum CDSC for class B shares continues to be 4%. For more complete information, please see the prospectus for details. Note: Shares purchased prior to December 1, 2004 remain subject to the CDSC in effect at the time you purchased those shares. For performance information for shares purchased prior to December 1, 2004, please visit www.pioneerfunds.com/bshares. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ. Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Trust distributions or the redemption of Trust shares. Index comparisons begin 4/30/94. The Lehman Brothers Government Bond Index measures the performance of the U.S. government bond market. The Lehman Brothers Fixed- Rate Mortgage-Backed Securities Index is an unmanaged index including 15- and 30-year fixed rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC) and Federal National Mortgage Association (FNMA). Index returns assume reinvestment of dividends and, unlike Trust returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in the Indexes.
Portfolio Management Discussion 12/31/04
As the U.S. economy expanded, the Federal Reserve began raising interest rates at a slow but steady pace. Short-term interest rates rose more than long-term rates, which remained virtually unchanged for the year. For example, at the beginning of the year, the yield on the two-year Treasury was 1.82%. At the end of the year, it was 3.07%. The yield on the 10-year Treasury began the year at 4.25% and ended the year at 4.22%. Against this backdrop, investors in U.S. Government and agency securities were rewarded with a relatively attractive level of income during the 12-month period ended December 31, 2004. In the interview below, Richard Schlanger, a member of the Pioneer fixed-income team, discusses the factors that affected the fixed-income market and the Trust over the past 12 months.
Q: How did the Trust perform during the period?
A: For the 12-month period ended December 31, 2004, Class A shares of Pioneer America Income Trust produced a total return of 2.77% at net asset value. The Trust underperformed its benchmark, the Lehman Brothers Government Bond Index, which returned 3.48% for the same period. The Trust also underperformed the Lehman Brothers Fixed-Rate Mortgage-Backed Index, which returned 4.70%. We attribute the shortfall relative to the Lehman Brothers Fixed-Rate Mortgage-Backed Index to the index's significant exposure to securities issued by the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal National Mortgage Association (Fannie Mae), which outperformed Ginnie Maes. Because conventional mortgages--those issued by Freddie Mac and Fannie Mae--do not have the backing of the full faith and credit of the U.S. Government, we do not invest in them. The Trust underperformed the 3.19% return generated by the General U.S. Government Funds Category of Lipper, an independent monitor of mutual fund performance. At the end of the period, the 30-day SEC yield for Class A shares was 3.25%. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Q. What was the investment environment like during the period?
A. The economy continued to gain strength in 2004, reflected by improving job growth, relatively strong consumer spending, and higher commodity and oil prices. With the economy on a firmer footing, the Federal Reserve boosted short-term interest rates in June and continued raising them through the end of the year. By year-end, the federal funds rate was 2.25%, up from 1.00% at the start of 2004. (The federal funds rate is the rate banks charge each other for overnight loans.) Initially, the Fed's actions caused Treasury yields to move higher but when it appeared that inflation was under control, the yield curve flattened. The yield curve shows the relationship between bond yields and maturity lengths. With a flatter yield curve, short-term yields moved higher and prices declined; longer-term yields fell or remained stable, boosting prices. An enormous amount of Treasury buying by overseas investors was also instrumental in keeping Treasury yields low. Foreign central banks had large cash reserves, which they invested at record levels in the U.S. Treasury market in an attempt to stem the decline of the U.S. dollar relative to their own currencies.
Q: How did you manage the Trust in this environment?
A: The Trust was divided between mortgage-backed securities, which accounted for 70.6% of net assets, and Treasury securities, which composed 28.2% of net assets. The Trust also had a 1.2% cash position. In the mortgage market, we invested in securities issued by the Government National Mortgage Association (GNMA), which are backed by the full faith and credit of the U.S. government. (A full faith and credit backing applies to underlying Trust securities, not to Trust shares). Because interest rates remained attractive and the housing market was strong, we sought to avoid prepayment risk. When interest rates decline, homeowners often "prepay" their existing mortgages and refinance their homes at a lower rate. Significant prepayment activity can result in declining yields and share prices in portfolios with investments in mortgages. To mitigate this risk, we favored mortgages with low loan balances that were not likely to be refinanced. We also emphasized mortgage pools in slow-paying states, such as New York and Texas, where the rate of housing turnover is relatively low in comparison to other states. In addition, we sought mortgages with coupons (stated rates of interest) in the 4.5% to 5.5% range, which would probably not be refinanced quickly. In the Treasury portion of the Trust, we emphasized securities with short to intermediate durations. We expected yields to move higher and wanted to minimize the price volatility that would naturally occur as yields rose. Therefore, we kept duration shorter than the benchmark. Measured in years, duration measures a bond's price sensitivity to interest-rate changes. A shorter duration can protect a portfolio from price declines as yields rise. We were premature, however, in our expectation of higher yields. As a result, our short-duration strategy worked against the Trust. Long-term Treasuries outperformed, because of the huge demand from overseas investors and the flattening of the yield curve. For example, the 30-year Treasury bond returned 8.89%; the five-year Treasury returned 2.39%.
Q: What contributed most to performance?
A: The significant overweight in mortgage-backed securities made the largest positive impact, as mortgages outperformed other fixed income assets. Minimizing prepayment risk by selecting specific mortgage pools also helped drive performance. The flatter yield curve, which boosted the prices of longer-term Treasury securities, also benefited results.
Q: What detracted from performance?
A: The Trust's underweight in long-term Treasuries. We continue to believe, however, that yields on such Treasuries are artificially low, given the weak U.S. dollar, the growing trade imbalance and a Fed that is likely to continue raising interest rates.
Q: What is your outlook for the next six months?
A: In the short term, we expect the investment environment to remain unchanged and are unlikely to alter the Trust significantly during the first quarter of 2005. We plan to continue to emphasize mortgage securities. In February, Federal Reserve Chairman Alan Greenspan will make his semi annual Humphrey-Hawkins testimony before Congressional committees. At that time, we will learn what to expect in the way of Fed interest-rate policy and what the central bank's thinking is about the prospects for accelerating inflation. Whenever the Fed raises rates, there is a lag effect; and it can take as long as a year for higher rates to affect the economy. Over the next several months, we will be closely monitoring data to determine the appropriate action to take should the economic backdrop change.
Government guarantees apply to the underlying securities only and not to the prices and yields of the portfolio. When interest rates rise, the prices of fixed income securities in the fund will generally fall. Conversely, when interest rates fall the prices of fixed income securities in the fund will generally rise. The portfolio may invest in mortgage-backed securities, which during times of fluctuating interest rates may increase or decrease more than other fixed-income securities. Mortgage-backed securities are also subject to pre-payments. Investments in the fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Trust's historical or future performance are statements of the opinion of Trust management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Short Term Income Fund
Performance Update 12/31/04 Class A Shares Share Price And Distributions
Net Asset Value per Share 2/28/05 8/31/04
$9.88 $10.02
Distributions per Share
(9/1/04 - 2/28/04)
Net Investment Income $0.1520
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Short Term Income Fund at public offering price, compared to that of the Lehman Brothers One- to Three-Year Government/Credit Index.
Average Annual Total Returns (as of February 28, 2005) Period Net Asset Value Public Offering Price (POP) Life-of-Class (7/8/04) 0.71% -1.84% |
[THE FOLLOWING DATA WAS REPRESENTED AS A LINE CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Short-Term Lehman Brothers One-to-Three
Income Fund Year Government/Credit Index
7/04 $9,750 $10,000
$9,804 $10,078
2/05 $9,816 $10,061
|
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
POP returns reflect deduction of maximum 2.5% sales charge. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Lehman Brothers One- to Three-Year Government/Credit Index measures the performance of the short term (1 to 3 years) government and investment-grade corporate bond markets. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in an Index.
Performance Update 2/28/04 Class B Shares Share Price And Distributions
Net Asset Value per Share 2/28/05 8/31/04
$9.88 $10.01
Distributions per Share
(9/1/04 - 2/28/05)
Net Investment Income $0.1097
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Short Term Income Fund, compared to that of the Lehman Brothers One- to Three-Year Government/Credit Index.
Average Annual Total Returns (as of February 28, 2005) Period If Held If Redeemed Life-of Class (7/8/04) 0.20% -1.78% |
[THE FOLLOWING DATA WAS REPRESENTED AS A LINE CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Short-Term Lehman Brothers One-to-Three
Income Fund Year Government/Credit Index
7/04 $10,000 $10,000
$ 9,840 $10,061
2/05 $ 9,822 $10,078
|
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Class B shares reflect the deduction of the maximum applicable contingent deferred sales charge (CDSC). The maximum CDSC is 4.0% and declines over five years.
All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Lehman Brothers One- to Three-Year Government/Credit Index measures the performance of the short term (1 to 3 years) government and investment-grade corporate bond markets. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in an Index.
Performance Update 2/28/05 Class Y Shares Share Price And Distributions
Net Asset Value per Share 2/28/05 8/31/04
$9.89 $10.01
Distributions per Share
(9/1/04 - 2/28/05)
Net Investment Income $0.1702
Short-Term Capital Gains $ --
Long-Term Capital Gains $ --
|
Investment Returns
The mountain chart on the right shows the change in value of a $10,000 investment made in Pioneer Short Term Income Fund, compared to that of the Lehman Brothers One- to Three-Year Government/Credit Index.
Average Annual Total Returns (as of February 28, 2005) Period If Held If Redeemed Life-of Class (7/8/04) 1.08% 1.08% |
[THE FOLLOWING DATA WAS REPRESENTED AS A LINE CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Short-Term Lehman Brothers One-to-Three
Income Fund Year Government/Credit Index
7/04 $10,000 $10,000
$10,057 $10,078
2/05 $10,108 $10,061
|
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Performance for periods prior to the inception of Y shares reflects the NAV performance of the Fund's A shares. The performance does not reflect differences in expenses, including the Rule 12b-1 fees applicable to A shares. Since fees for A shares are generally higher than those of Y shares, the performance shown for Y shares prior to their inception would have been higher. Class Y shares are not subject to sales charges and are available for limited groups of eligible investors, including institutional investors. All results are historical and assume the reinvestment of dividends and capital gains. Other share classes are available for which performance and expenses will differ.
Performance results reflect any applicable expense waivers in effect during the periods shown. Without such waivers Fund performance would be lower. Waivers may not be in effect for all funds. Certain fee waivers are contractual through a specified period. Otherwise, fee waivers can be rescinded at any time. See the prospectus and financial statements for more information.
The performance table and graph do not reflect the deduction of taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
The Lehman Brothers One- to Three-Year Government/Credit Index measures the performance of the short term (1 to 3 years) government and investment-grade corporate bond markets. Index returns are calculated monthly, assume reinvestment of dividends and, unlike Fund returns, do not reflect any fees, expenses or sales charges. You cannot invest directly in an Index.
Portfolio Management Discussion 2/28/05
In the following interview, Richard Schlanger, the Fund's Lead portfolio Manager, discusses the factors that influenced performance for the semiannual period ended February 28, 2005.
Q. How would you characterize the market environment for fixed- income investors over the six-month period?
A. On balance, the economy continued to show evidence of solid growth, although some of the employment statistics have not been as robust as in past recoveries. Given this backdrop, the Federal Reserve continued to execute a "measured" approach to removing its accommodative stance with respect to short-term interest rates. This took the form of three separate hikes in the benchmark fed funds rate (the interbank overnight lending rate) totaling three-quarters of a percentage point over the period.
While long-term interest rates were relatively stable, shorter-term bonds experienced yield increases - and corresponding price declines - over the period. Yields on shorter-maturity issues rose substantially over the period, with both the six-month and two-year Treasuries experiencing yield increases of just over one percentage point. By contrast, long-term interest rates ended the period only slightly higher than where they began, with the ten-year Treasury yield increasing approximately one-quarter percentage point.
Q. How did the Fund perform in this environment?
A. The Fund's total return from August 31, 2004, through February 28, 2005 was a positive 0.12%, versus -0.16% for the unmanaged benchmark index, the Lehman Brothers One-to Three-Year Government/Credit Index. The return number is for Class A shares and does not include the impact of any sales charge paid.
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results. Current performance may be lower or higher than the performance data quoted.
The performance data quoted represents past performance, which is no guarantee of future results. Investment return and Pioneer Short Term Income Fund principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
The Fund also continued to deliver good income. The 30-day SEC yield for Class A shares on February 28, 2005, was 2.47%. This yield reflects the waiver of certain expenses by the investment advisor; without the waiver, the 30-day SEC yield for Class A shares would have been 1.99%.
The Fund's absolute return for the six-month period primarily reflects a difficult environment for short-term bonds, as yields increased and prices generally fell among these issues.
We believe the Fund's comparatively better performance versus its benchmark index can be attributed to a combination of:
1. shorter overall portfolio duration - a measure of interest rate sensitivity - which helped cushion against pervasive price declines;
2. security selection favoring mortgage pass-through securities, an area of the bond market that outperformed Treasury securities.
Q. What is your outlook?
A. We continue to believe that, despite some underlying strain, the global economy is on a path of solid growth, led by the United States, which appears positioned to deliver GDP growth in the 3.5% to 4.0% range for the near-to-intermediate term. Growth at this level would support solid expansion in employment over time and could put some upward pressure on inflation and interest rates. In addition, the decline of the U.S. dollar and continued high oil prices both suggest that a rise in inflation would not be surprising, with a corresponding impact on interest rates. Finally, the lack of progress in reducing the U.S. budget deficit may also lead to rising interest rates over time. With respect to short-term rates, we expect the Fed to continue on a course to raise rates gradually over the next year or so in an effort to contain potential inflationary pressures while allowing the economy to continue on its current growth path.
Q. How is the Fund currently positioned?
A. In view of our outlook for continued solid economic growth, the Fund is somewhat conservatively positioned from the perspective of sensitivity to changes in interest rates. At the end of February, the Fund's weighted average maturity was 1.38 years, well under the Fund's maximum of three years.
Average quality of the Fund's portfolio is currently a high "AA." We continue to maintain broad exposure to a number of areas of the bond market, while seeking to identify and benefit from relative value among sectors. Currently, yield differentials are quite narrow among sectors on the short end of the curve. For instance, high-quality corporates offer less than half of a percentage point of additional yield versus Treasuries of comparable maturity. At the end of February, our weighting in corporate bonds accounted for about 22% of Fund assets, at the low end of our anticipated range.
Nearly 35% of the Fund's assets are invested in mortgage pass-through securities, down from approximately 40% at the beginning of the period, again reflecting our view on relative value. Our holdings among pass-throughs are focused on "balloon" mortgages with shorter maturities, as well as collateralized mortgage obligations that we believe carry low risk of experiencing a slowing of prepayments (and corresponding increase in duration.
U.S. Treasury issues totaled about 32% of assets at period end, including a small position (approximately 3.7%) in short-term "STRIPS" or "zero coupon" bonds. STRIPS are purchased at a discount to face value and redeemed at par value upon maturity, and the position is anticipated to provide an additional measure of support for the Fund's share price.
Going forward, we will continue to seek to provide a high level of current income while maintaining a relatively stable share price. While the Fund's share price will fluctuate, our focus on shorter-term bonds is designed to reduce price volatility in comparison to longer term alternatives. We believe the Fund's high quality and limited exposure to interest-rate changes makes it an attractive option for investors seeking to maintain important fixed-income exposure in an uncertain environment.
Investing in foreign and/or emerging markets securities involves risks relating to interest rates, currency exchange rates, economic, and political conditions. When interest rates rise, the prices of fixed income securities in the Fund will generally fall. Conversely, when interest rates fall the prices of fixed income securities in the Fund will generally rise. Investments in the Fund are subject to possible loss due to the financial failure of underlying securities and their inability to meet their debt obligations.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Cash Reserves Fund
Performance Update 12/31/ 04
Share Prices
Performance Update 12/31/04 Class A Shares Share Price And Distributions
Net Asset Value per Share 12/31/04 12/31/03
Class A Shares $ $1.00 $1.00
Class B Shares $1.00 $1.00
Class C Shares $1.00 $1.00
Class R Shares $1.00 $1.00
12/31/04 12/11/04
Investor Class Shares $1.00 $100
|
Distributions Per Share
(1/1/04 - 12/31/04) Income Dividends Short-Term Capital Gains Long-Term Capital Gain Class A Shares $0.00448 $ -- $ -- Class B Shares 0.00060 Class C Shares 0.00060 Class R Shares 0.00268 (12/11/04 - 12/31/04) Investor Class Shares 0.00067 |
Yields *
7-Day Annualized 7-Day Effective**
Class A Shares 1.12% 1.13%
Class B Shares 0.24% 0.24%
Class C Shares 0.13% 0.13%
Class R Shares 0.91% 0.91%
Investor Class Shares 1.33% 1.34%
|
* The 7-day yields do not reflect the deduction of the contingent deferred sales charge (CDSC) for Class B (maximum 4%) and Class C (maximum 1%) shares. Please contact Pioneer to obtain the Fund's current 7-day yields.
** Assumes daily compounding of dividends. The 7-day effective yield if fees and expenses were not subsidized would be as follows: Investor Class Shares 1.25%. Class A, Class B, Class C and Class R fees and expenses were not subsidized.
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end performance results.
Current performance may be lower or higher than the performance data quoted. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Pioneer has agreed to limit the Fund's expenses for any class of shares or waive a portion of its management fee to maintain a net asset value of $1.00. Under certain circumstances, this limitation may result in a 0.00% yield for one or more classes of shares. From time to time, Pioneer and its affiliates may limit the expenses of one or more classes for the purpose of increasing its yield during the period of the limitation. These expense limitation policies are voluntary and temporary and may be revised
or terminated by Pioneer at any time without notice. Performance does not reflect the deduction of taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
Portfolio Management Discussion 12/31/04
Although the U.S. Federal Reserve started to raise short-term interest rates from the lowest levels reached in more than four decades, 2004 remained a year in which money market investments offered extremely low yields by historical measures. Despite five increases in interest rates between June 30 and December 31, the key Fed Funds Rate ended the year at just 2.25%. Throughout the 12 months ended December 31, 2004, Pioneer Cash Reserves Fund maintained a $1 share price and provided modest income consistent with the yields available in the money market. The Fund invests exclusively in high quality money market instruments issued by the U.S. government and domestic corporations and banks. All issues have the highest ratings from the two nationally recognized ratings organizations: A1 by Standard & Poor's Investors Services and P1 by Moody's Investor Services. (Ratings apply to underlying securities, not Fund shares.) In the following discussion, Andrew D. Feltus reviews the investment environment and the strategies that affected Pioneer Cash Reserves Fund over the 12 months ended December 31, 2004. Mr. Feltus is a member of Pioneer's Fixed Income Group, which is responsible for the daily management of the Fund.
Q: How did the Fund perform during 2004?
A: For the 12 months ended December 31, 2004, Class A shares of Pioneer Cash Reserves Fund had a total return of 0.45%, at net asset value. On December 31, 2004, the Fund's seven-day effective yield for Class A shares was 1.13%. For the 12 months, the average total return among the 395 funds in Lipper's Money Market Fund category was 0.60%. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Q: What was the investment environment like during the year?
A: For virtually the entire first half of 2004, the influential Fed Funds Rate remained at a 46-year low of 1.00%. The situation began to change when the Federal Reserve raised the rate on June 30 by one-quarter of one percentage point and signaled that it intended to initiate further increases on a gradual basis. The central bank raised the rate four more times, and the Fed Funds Rate stood at 2.25% at the end of the year. The rate increases occurred against a backdrop of continued economic growth and hints of an increase in inflationary pressure. Economic growth, as measured by growth in Gross Domestic Product (GDP), rose by an average annualized rate of 4.6% during the first nine months of 2004. Affected by the higher costs of energy, the Consumer Price Index rose to about 3.5% by the end of November. While periodic concerns about low new-job creation did arise, in general the Federal Reserve Board believed that the economy was gathering enough strength that monetary policy could be tightened to avert the possibility of increasing inflationary threats. At the end of the year, the Federal Reserve was widely expected to continue to raise short-term rates further in 2005.
Q: What were your principal strategies in this low-interest rate environment?
A: We held to our commitment to high quality money market instruments. We started gradually to lower the Fund's effective duration so that we could take advantage of higher yields available as the Federal Reserve Board proceeded with its rate increases. At the end of the year, the effective duration of the Fund was 60 days, and we were moving to have a target duration of about 45 days as the new year unfolded.
Q: What is your investment outlook?
A: We anticipate that the economy will show sustained growth in 2005 and that the Federal Reserve Board will maintain its policy of raising short-term grates gradually. At the same time, because of budget pressures and concern about the federal deficit, the government is likely to put new brakes on spending. The combination of the tighter monetary policy and restrained fiscal policy may act as a drag on the pace of economic growth and ultimately cause a possible change in monetary policy.
If economic growth does begin to slow, the Federal Reserve may revise its current bias toward raising short-term rates. However, until that appears to be imminent, we intend to continue to keep the Fund's effective duration relatively short to enable us to invest in newer, higher-yielding securities that have the potential to raise the level of income to be distributed to
shareholders. Investing in foreign and/or emerging markets securities involves risks relating to interest rates, currency exchange rates, economic, and political conditions. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund. Fund shares are not federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
Pioneer Tax Free Money Market Fund
Performance Update 12/31/04
Share Prices
Net Asset Value per Share 12/31/04 2/11/04
Class A Shares $1.00 $1.00
12/31/04 12/31/03
Investor Class Shares $1.00 $1.00
|
Performance Update 12/31/04 Class A Shares Share Price And Distributions
Distributions per Share Class A Shares (12/11/04 - 12/31/04) Income Dividends $0.0004 Short-Term Capital Gains $ -- Long-Term Capital Gains $ -- (1/1/04 - 12/31/04) Investor Class Shares Income Dividends $.0059 Short-Term Capital Gains $ -- Long-Term Capital Gains $ -- Yields 7-Day Annualized 7-Day Effective Class A Shares 0.83% 0.83% Investor Class Shares 1.01% 1.01% |
** Assumes daily compounding of dividends. The 7-day effective yield if fees and expenses were not subsidized would be as follows: Class A 0.76% and Investor Class shares 0.76%.
Performance data shown represents past performance. Past performance does not guarantee future results. Investment returns will fluctuate, and there can be no guarantee the Fund will be able to maintain a stable net asset value of $1.00 per share. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund. The performance of each class of the Fund is the performance of the predecessor fund's Investor Class, which has been restated to reflect differences in any applicable sales charges (but not Rule 12b-1 fees or other differences in expenses). If all the expenses of the Pioneer fund were reflected, the performance would be lower. Performance does not reflect the deduction of taxes that a shareowner would pay on Fund distributions or the redemption of Fund shares.
Portfolio Management Discussion 12/31/04
On August 2, 2004, Pioneer Investments assumed management of the former Safeco Funds. In the following interview, David Eurkus, a member of the fixed income team, details the investment environment for tax-free money funds during the 12-month period ended December 31, 2004, the Fund's performance for the period, and the Fund's portfolio strategy going forward.
Q: Will you describe what, if anything, has changed and what has remained the same in the transition of Fund management to Pioneer?
A: As a Safeco product, and now as Pioneer Tax Free Money Market Fund, this has been and will continue to be a very conservative offering. We are keeping the Fund as a high quality, liquid product. We will not compromise stability of principal in any way by taking on additional risk to secure a more competitive yield than our peers. Safety of principal is paramount and, as part of the objective, we will continue to seek tax-free income for the Fund's shareholders.
Q: How did the Fund perform during its most recent fiscal year?
A: For the 12-month period ended December 31, 2004, the Fund's Class A shares posted a 0.58% total return at net asset value. (The performance of each class of the Fund is the performance of the predecessor fund's Investor Class, which has been restated to reflect differences in any applicable sales charges (but not Rule 12b-1 fees or other differences in expenses). If all the expenses of the Pioneer fund were reflected, the performance would be lower.) In comparison, the Lipper Tax-Exempt Money Market Average returned 0.56%. The performance data quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, and shares, when redeemed, may be worth more or less than their original cost.
Q: Will you describe the investing environment for tax-exempt money funds during the time period?
A: Prior to June 2004, short- and long-term interest rates had continued to fall since the stock market bubble burst in 2001. Early last year, one-year tax-free money market rates fell as low as 0.50%. Then, as the U.S. economy began to show modest improvement in the first half of 2004, the Federal Reserve indicated that the economy and job growth were showing signs of improvement and that the Fed was becoming more concerned about the possibility of rising inflation rather than deflation. The Fed also hinted that it would begin to raise short-term interest rates in the second half of 2004, but at a "measured" pace. The Fed then raised short-term interest rates by 25 basis points at each of its five meetings in the second half of the year. As a result, the one-year Bond Buyer Index, the market's measurement of tax-exempt money market rates, rose from 0.50% at the start of the year to 1.25% at year end. Historically, those are still extremely low rates. Supply and demand for tax-exempt money market securities continue to be well balanced. This is evidenced by the still significant amount of assets being held in taxable as well as tax-free money market funds. Investor demand continues to be substantial, and there is ample supply to deal with the asset base.
Q: What has been your strategy since assuming management of the Fund last August?
A: We continue to maintain broad diversification, both on a regional and national basis, with AAA credits in revenue as well as general obligation issues. As a Seattle-based fund, the previous Safeco product was regionally focused, with investments based in Colorado, Texas and Alaska as its top three portfolio concentrations. As we continue to emphasize safety of principal we will be changing to a more nationally focused diversification strategy. The Fund invests in floating rate securities (55% of portfolio assets as of December 31, 2004) as well as fixed-rate instruments (45% of assets). The interest rate of floating rate securities adjusts periodically based on indices such as the Bond Buyer Index and the Fed funds rate. As of December 31, the Fund's effective maturity was 56 days. With the Fed's series of short term interest rate increases, the yield curve is changing, and we will adjust the portfolio accordingly. As some six- and 12-month securities in the portfolio mature we are converting them to cash in anticipation of further short-term interest rate increases. That will gradually decrease the Fund's weighted average maturity in the short term. Over the long term this strategy should benefit shareholders because we will be reinvesting at higher rates than the yields that are currently available. In terms of portfolio quality, over 90% of the portfolio is AAA-rated, with the balance rated AA. (Ratings apply to underlying securities, not Fund shares.)
Q: What is your outlook?
A: In the months ahead, we foresee continued modest growth in the U.S. economy. We also think that the Fed will maintain its bias for measured increases in short-term interest rates over the next several months. A portion of income may be subject to state, federal, and/or alternative minimum tax. Capital gains, if any, are subject to a capital gains tax. Investing in foreign and/or emerging markets securities involves risks relating to interest rates, currency exchange rates, economic, and political conditions. When interest rates rise, the prices of fixed income securities in the Fund will generally fall. Conversely, when interest rates fall the prices of fixed income securities in the Fund will generally rise. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund. Fund shares are not federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency.
Any information in this shareholder report regarding market or economic trends or the factors influencing the Fund's historical or future performance are statements of the opinion of Fund management as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that market forecasts discussed will be realized.
PORTFOLIO MANAGER
Brian B. Sullivan, CFA
Director, Value Equity Strategies
AmSouth Bank
AmSouth Asset Management, Inc.
Brian Sullivan has been the portfolio manager for the AmSouth Value and AmSouth Balanced Fund since June 2004. Mr. Sullivan has more than 18 years of investment management experience and holds an MBA in finance and a bachelor's degree in economics.
INVESTMENT CONCERNS
Value-based investments are subject to the risk that the broad market may not recognize their intrinsic value.
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 11.37% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 10.47% total return for the Fund's benchmark, the S&P 500/BARRA Value Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the period ended January 31, 2005, were 5.27%, 4.36%, 1.77% and 9.18%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. A favorable backdrop, characterized by economic growth, the resolution of the presidential election and a pullback in oil prices, helped stocks rally during the fourth quarter of 2004. Value stocks performed particularly well, boosting this Fund's returns
Stock selection produced the largest contribution to the Fund's relative performance. Strong performance by particular stocks in the restaurant and retail industries helped the Fund's consumer- discretionary stocks outperform the corresponding sector in the index.
The Fund's relative returns also benefited from our strategy in the energy sector whereby we reduced the Fund's energy holdings during the period as prices on energy stocks increased. That strategy boosted performance against the benchmark, as energy stocks declined late in the period in response to falling oil prices. +
The Fund held an underweight position in utilities stocks during the period. That stake weighed slightly on relative returns, as utilities stocks led the benchmark. The reverse was true for performance data quoted represents past performance telecommunications services stocks. We over-weighted that sector, and current returns may be lower or higher. Total return so its relatively weak performance modestly reduced the Fund's figures include change in share price, reinvestment of return relative to the returns of the benchmark. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGERS
OakBrook Investments, LLC (sub-advisor)
Neil Wright, President and Chief Investment Officer
Janna Sampson, Director of Portfolio Management
Peter Jankovskis, Director of Research
As portfolio managers for the AmSouth Select Equity Fund, Neil Wright, Janna Sampson and Peter Jankovskis are three veteran investment professionals who have more than 50 years of combined experience. Neil and Peter hold PhDs in economics, and Janna holds an MA in economics. They have worked together for the past 12 years. They also serve as the portfolio managers for the AmSouth Enhanced Market Fund and the AmSouth Mid Cap Fund.
INVESTMENT CONCERNS
A concentrated portfolio may add a measure of volatility to performance, as major fluctuations in any one holding will likely affect the fund more than a fund with a greater diversification.
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 8.94% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower), compared to a 8.15% total return for its benchmark, the S&P 500 Stock Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and Since Inception (9/1/98) average annual total returns for the period ended January 31, 2005, were 2.92%, 1.41%, 8.79% and 6.94%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. Large-cap stocks generated gains during most of the period, which included a strong rally during November and December. That environment helped the Fund and its benchmark produce positive returns.
This Fund's sub-advisor, OakBrook Investments, invests in select shares of industry-leading companies with steady and predictable earnings growth. We believe the Fund's managers positioned the portfolio to benefit from an economic recovery, while avoiding exposure to stocks that were likely to be hurt by rising interest rates.
That strategy helped the Fund stay even with the market during the first five months of the period, as short-term interest rates increased and a cyclical pick-up did occur. A decline in long-term interest rates offset some of the benefits of the managers' strategy, however. What's more, rising commodity prices had a negative impact on the Fund's holdings. Shares of the industry-leading firms in which this Fund invests tend to be consumers of commodities, rather than producers of them, and therefore suffer from rising commodity prices.+
The market experienced a sell-off in January. This Fund's holdings fared better than the benchmark in that environment, and generated most of the Fund's relative gains for the six-month period. This may reflect the fact that investors during January prized the earnings stability and predictability that this Fund emphasizes. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
The AmSouth Select Equity Fund is subadvised by OakBrook Investments, LLC, which is paid a fee for its services.
PORTFOLIO MANAGERS
OakBrook Investments, LLC (sub-advisor):
Neil Wright, President and Chief Investment Officer
Janna Sampson, Director of Portfolio Management
Peter Jankovskis, Director of Research
As portfolio managers for the AmSouth Enhanced Market Fund, Neil Wright, Janna Sampson and Peter Jankovskis are three veteran investment professionals who have more than 50 years of combined experience. Neil and Peter have PhDs in economics, and Janna holds an MA in economics. They have worked together for the past 12 years. In addition to the Enhanced Market Fund, they also serve as portfolio managers of the AmSouth Select Equity Fund and the AmSouth Mid Cap Fund.
INVESTMENT CONCERNS
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 8.07% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). The Fund's benchmark, the S&P 500 Stock Index(1), returned 8.15%.
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and Since Inception (9/1/98) average annual total returns for the period ended January 31, 2005, were 2.15%, -0.20%, -3.52% and 3.42%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. Large-cap stocks produced positive returns during most of the period, including strong gains during the fourth quarter of 2004. That environment helped the Fund and its benchmark generate positive returns.
This Fund's sub-advisor, OakBrook Investments, emphasizes or deemphasizes the stocks in the index based on a quantitative model that monitors investor expectations for each stock. That approach enhanced the Fund's relative returns during the period. Stock selection boosted returns against the benchmark, particularly in the consumer discretionary and financial sectors. Sector allocation also boosted relative returns slightly. The Fund benefited from an over-weight position in energy stocks and underweight stakes in telecommunications and consumer discretionary shares. +
The Fund held a modest cash position throughout the period, to manage shareholder redemptions and capture developing investment opportunities. That cash stake weighed on returns versus the benchmark, as did trading costs and fees. Those factors caused the Fund to lag its benchmark by a small margin. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
The AmSouth Enhanced Market Fund is subadvised by OakBrook Investments, LLC,
which is paid a fee for its services
PORTFOLIO MANAGER
Ronald E. Lindquist
Co-Director, Growth Equity Strategy
AmSouth Bank
AmSouth Asset Management, Inc.
Ron Lindquist has more than 35 years of focused investment management experience. He has served as portfolio manager of AmSouth's Large Cap Fund since its inception and also serves as co-director of growth equity strategies for AmSouth Asset Management, Inc. A founding member of the Financial Analysts Society of South Florida, Mr. Lindquist holds a master's degree in management science from Florida International University and a bachelor's degree in finance from Florida State University.
INVESTMENT CONCERNS
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 5.33% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 8.15% total return for the Fund's benchmark, the S&P 500 Stock Index. (1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the period ended January 31, 2005, were -0.48%, -5.88%, -3.62% and 10.70%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance during the period?
A. The equity market posted solid gains during the six-month period through January, boosting the returns of the Fund and giving an even stronger lift to the broad-market S&P 500.
The Fund has long emphasized large and high-quality growth stocks. That philosophy muted its performance relative to its benchmark. The disparity between the Fund's market-capitalization size, and that of its target, weighed heavily on comparative returns during this period, as smaller and sometimes riskier stocks significantly outperformed larger-company shares.+
Moreover, our Fund's traditional, long-term and rigorously focused growth style approach typically leads it to hold larger stakes than its benchmark in both the health care and the technology sectors. The recent powerful performance of energy stocks undermined the
Fund's relative returns. Our stock selection in the industrials and, to some extent, the health care sectors also hurt our Fund's relative performance.+
Our consumer discretionary and consumer staples allocations provided a modest lift against all of the comparative indices. Conversely, our significantly underweight position in the dramatically outperforming utilities sector hurt relative performance. Our long-established practice of eschewing the sector caused the Fund to lose some ground.+
We believe our Fund is well-positioned to compete successfully when large-cap growth stocks resume market leadership. Until then, we will continue to execute in the focused, traditional-growth style that historically has provided our Fund's above-average long term returns. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
(2) Price to Earnings Ratio is a valuation ratio of a company's current share
price to its per-share earnings. A high P/E could mean high projected earnings
in the future
PORTFOLIO MANAGER
John Mark McKenzie
Co-Director, Growth Equity Strategy
AmSouth Asset Management, Inc.
John Mark McKenzie has been an investment manager since 1981. His experience includes both equity portfolio and fixed income portfolio management. He has managed a number of AmSouth Mutual Funds and was named portfolio manager of the AmSouth Capital Growth Fund in 2004. In addition, he serves as Co-Director of Growth Equity Strategy for AmSouth Asset Management, Inc. Mr. McKenzie holds a bachelor's degree in banking and finance from the University of Mississippi, and earned his law degree from the University of Mississippi School of Law. He is a member of the Mississippi Society of Financial Analysts and the Mississippi State Bar Association.
INVESTMENT CONCERNS
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 6.03% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 5.80% total return for the Fund's benchmark, the S&P 500/BARRA Growth Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the period ended January 31, 2005, were 0.19%, -5.49%, -6.16% and 8.66%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. The stock market posted solid gains during the period, helping the returns of the Fund and its benchmark. Value stocks led the market, however, creating a headwind for this growth-oriented Fund.
Stock selection provided the largest benefit to the Fund's performance relative to its benchmark. On the whole, the stocks in the Fund's portfolio showed increases in sales and earnings growth and in returns on assets and returns on equity. Those improvements helped the Fund's performance compared to its index. In particular, the Fund's holdings in the health care and consumer discretionary sectors significantly outperformed those sectors in the index. Individual selections in the consumer staples sector did drag somewhat on relative returns.+
We increased the Fund's stake in mid-capitalization shares during the period. That change boosted returns against the benchmark, as smaller stocks generally outperformed larger stocks. We also increased the Fund's emphasis on stocks with relatively high growth rates and capital gains potential. That strategy reduced the Fund's exposure to dividend-paying stocks, causing a decrease in yield pay-outs to the Fund. That said, the more-aggressive strategy helped the Fund out-gain its benchmark in a rising market. +
This Fund emphasizes long-term earnings growth. As a result we did not increase the Fund's weightings in the energy or basic materials sectors, since those sectors showed little long-term earnings growth potential.
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGERS
OakBrook Investments, LLC (sub-advisor):
Neil Wright, President and Chief Investment Officer
Janna Sampson, Director of Portfolio Management
Peter Jankovskis, Director of Research
As portfolio managers for the AmSouth Mid Cap Fund, Neil Wright, Janna Sampson and Peter Jankovskis are three veteran investment professionals who have more than 50 years of combined experience. Neil and Peter have PhDs in economics, and Janna holds an MA in economics. They have worked together for the past 12 years. The team also manages the AmSouth Select Equity Fund and the AmSouth Enhanced Market Fund.
INVESTMENT CONCERNS
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Mid-capitalization stocks typically carry additional risk, since smaller companies generally have higher risk of failure and, historically, their stocks have experienced a greater degree of volatility.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 12.31% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 12.24% total return for the Fund's benchmark, the S&P MidCap 400 Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and Since Inception (5/4/99) average annual total returns for the periods ended January 31, 2005, were 6.16%, 4.63%, -5.43% and 4.74%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance during the period?
A. Mid-cap stocks posted strong returns during the period. Medium-sized stocks lost ground during August, but surged from September through December before slipping back in January. That environment helped the Fund and its benchmark generate strong gains.
This Fund's sub-advisor, OakBrook Investments, over- or under-weights the stocks in its benchmark based on a quantitative model that monitors investor expectations surrounding each stock. That methodology boosted relative returns during the period. Stock
selection added to relative gains, as the Fund's holdings in the information technology, consumer discretionary and industrials sectors out-performed the respective sectors in the benchmark. +
Those positive factors were partly offset by the Fund's sector weightings--in particular an overweight position in energy stocks during the last three months of the period. Mid-cap energy stocks performed well during the first two months of the recent period, but subsequently retrenched as energy prices declined. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information
The AmSouth Mid Cap Fund is subadvised by OakBrook Investments, LLC, which is
paid a fee for its services.
PORTFOLIO MANAGER
Sawgrass Asset Management, LLC (sub-advisor):
Dean McQuiddy, CFA
Principal and Director of Equity Investments
Dean McQuiddy serves as portfolio manager for the AmSouth Small Cap Fund. He has nearly 20 years of experience in investment management and holds a BS in finance. He created and managed the small-cap growth product at Barnett Capital Advisors for 11 years.
INVESTMENT CONCERNS
Small capitalization funds typically carry additional risks since smaller companies generally have a higher risk of failure.
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 12.53% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 13.48% total return for the Fund's benchmark, the Russell 2000(R) Growth Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and Since Inception (3/3/98) average annual total returns for the periods ended January 31, 2005, were 6.39%, 4.09%, -2.43% and -0.54%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance during the period?
A. Small stocks rallied, helping the Fund and its benchmark post solid gains. Growth shares lagged value stocks, creating a headwind for this growth-oriented portfolio.
This Fund's sub-advisor, Sawgrass Asset Management, held a significantly underweight position in health care stocks: The Fund held an average of 13.5% of its assets in the health care sector, compared to an average of 21.5% for the benchmark. That comparatively small stake boosted performance against the index, as health care stocks lagged the market. Stock selection in the health care sector also had a modestly beneficial effect on relative returns. +
The managers also under-weighted the technology sector, with an average allocation of 22%, versus an average allocation of 27% for the benchmark. Technology stocks trailed the market, so the Fund's smaller stake increased relative gains. Stock selection in this sector also boosted returns against the index. Selection among consumer discretionary stocks helped the Fund's relative performance as well.+
Stock selection hurt relative returns in the basic materials sector, as the Fund did not fully participate in a strong rally by shares of steel and aluminum producers. The Fund held an overweight stake in energy stocks. That sector generally posted strong performance, but the Fund's energy holdings did not keep pace with those in the index. As a result, the Fund's holdings in that sector weighed on the portfolio's relative performance. +
Similarly, the Fund's overweight position in industrial stocks included some individual holdings that did not perform as well as the sector, which taken as a whole posted relatively strong gains. As a result, the Fund's allocation to industrial stocks hurt the portfolio's returns against the index. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
The AmSouth Small Cap Fund is subadvised by Sawgrass Asset Management, LLC,
which is paid a fee for its services.
PORTFOLIO MANAGERS
Dimensional Fund Advisors Inc. (sub-advisor)
Dimensional Fund Advisors Inc. employs a team approach in subadvising the International Equity Fund. The Investment Committee sets policy and procedures, and portfolio managers make daily decisions regarding the Fund. Karen Umland, VP and portfolio manager heads the international group. Portfolio managers on the international team are located in Los Angeles, London and Sydney.
INVESTMENT CONCERNS
An investment in this Fund entails the special risks of international investing, including currency exchange fluctuation, government regulations, and the potential for political and economic instability. The Fund's share price is expected to be more volatile than that of a U.S.-only fund.
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes.
Value-based investments are subject to the risk that the broad market may not recognize their intrinsic value.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 20.47% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 16.68% total return for the Fund's benchmark, the Morgan Stanley Capital International EAFE(R) (Europe, Australasia and Far East) Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and Since Inception (8/18/97) average annual total returns for the periods ended January 31, 2005, were 13.81%, 14.95%, 2.05% and 4.43%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. Developed international stock markets generated strong returns during the period, helping the Fund and the benchmark produce solid gains. The dollar weakened compared to most foreign currencies. The Fund does not hedge its exposure to foreign currencies, so dollar weakness increased the Fund's returns. Strong performance among value and small-cap stocks also boosted the Fund's absolute performance. +
The Fund's sub-advisor, Dimensional Fund Advisors, employs a strict value methodology to construct a portfolio that is broadly diversified across geographical regions. The managers rank the stocks in each of the 21 developed markets represented in the index primarily using book value-to-market capitalization, and invest in approximately the top 30% of stocks, by number, in each country. +
That approach helped the Fund outperform its benchmark, since value stocks led global stock markets during the period. The Fund's value discipline also typically leads it to hold shares with smaller average market capitalizations than the average stocks that comprise the Fund's benchmark. That dynamic also boosted relative returns, as smaller shares outperformed larger stocks for the six-month period. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
The AmSouth International Equity Fund is subadvised by Dimensional Fund Advisor
Inc, which is paid a fee for its services.
PORTFOLIO MANAGERS
Brian B. Sullivan, CFA
Director, Value Equity Strategies
John P. Boston, CFA
Chief Fixed Income Officer
AmSouth Bank
AmSouth Asset Investment Management, Inc.
Brian Sullivan has been the portfolio manager for the AmSouth Value and AmSouth Balanced Fund since June 2004. Mr. Sullivan has more than 18 years of investment management experience and holds an MBA in finance and a bachelor's degree in economics.
John Boston manages the AmSouth High Quality Bond Fund and co-manages the AmSouth Government Income Fund, AmSouth Limited Term Bond Fund and the AmSouth Balanced Fund. Mr. Boston joined the Asset Management Division in 1987. Mr. Boston earned his B.S. in Finance and Political Science from the University of North Alabama. He is a member and past president of the Alabama Society of Financial Analysts and holds the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes. Bonds offer a relatively stable level of income, although bond prices will fluctuate providing the potential for principal gain or loss. Intermediate-term, higher-quality bonds generally offer less risk than longer-term bonds and a lower rate of return.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 6.26% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). The Fund's benchmarks, the S&P 500 Stock Index(1) and the Lehman Brothers Government/Credit Bond Index(1), returned 8.15% and 4.02%, respectively.
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
The Fund held an average of approximately 60% of its assets in stocks and roughly 40% of its assets in bonds. Stocks significantly outperformed bonds during the period, so the Fund's emphasis on stocks helped boost returns.
With the maximum sales charge of 5.50% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the periods ended January 31, 2005, were 0.44%, -1.15%, 5.15% and 8.72%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. Stocks posted solid returns during the period, particularly during the fourth calendar quarter of 2004. That trend boosted the returns of the Fund's equity allocation. Yields on long-term bonds declined, while yields on short-term bonds rose. The Fund's fixed-income portion generated modest gains in that environment.+
We maintained a higher-than-neutral stock allocation throughout the period. The Fund held 60% of its assets in stocks, compared to its neutral position of 50%. The emphasis on equities boosted the Fund's returns relative to its neutral weightings, as stocks significantly outperformed bonds. +
Stock selection helped the Fund's equity allocation outperform the S&P 500. Selection in the health care sector was especially beneficial: The Fund's health care stake out-gained the health care stocks in the S&P 500 by approximately eight percentage points, largely because we avoided or under-weighted several stocks that suffered very poor returns. The Fund's superior performance in the health care sector made a significant impact on relative performance, because health care stocks comprise a sizable portion of the index and this Fund. Stock selection in the technology sector weighed on the equity allocation's returns against the stock benchmark, largely due to weak returns among certain hardware and networking stocks in the Fund's portfolio. +
The Fund's bond allocation lagged its benchmark for the period. We maintained a short average duration relative to the fixed-income index, to protect against rising interest rates. That strategy left the Fund underexposed to long-term bonds, which saw their yields decline and their prices rise. We increased the Fund's average duration late in the period. +
The bond allocation's returns relative to the fixed-income benchmark benefited from an emphasis on corporate bonds, which outperformed government credit. The Fund's high-quality focus prevented it from benefiting from even stronger performance among lower-quality issues, however. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
Aggressive Growth
Growth
Growth and Income
Moderate Growth and Income
The AmSouth Strategic Portfolios are managed by a team of AmSouth investment managers, including both equity and fixed income specialists. The team has more than 40 years of combined investment management experience.
INVESTMENT CONCERNS
The Funds invest in underlying funds, so the investment performance is directly related to the performance of those underlying funds. Before investing in the Fund, investors should assess the risks associated with and types of investments made by each of the underlying funds in which the Funds invests.
Q. How did the Funds perform during the period?
A. During the six-month period ended January 31, 2005, the Funds' total returns, benchmark returns and other comparative returns were as follows:
AmSouth Aggressive Growth Portfolio
(Class A Shares at NAV. Had the effects of the front-end sales charge been
included, the return would have been lower): 9.87%
S&P 500 Stock Index(1): 8.15%
Lipper Multi-Cap Core Funds Average(1): 9.47%
AmSouth Growth Portfolio
(Class A Shares at NAV. Had the effects of the front-end sales charge been
included, the return would have been lower): 7.91%
S&P 500 Stock Index(1): 8.15%
Lipper Multi-Cap Growth Funds Average(1): 10.47%
AmSouth Growth and Income Portfolio
(Class A Shares at NAV. Had the effects of the front-end sales charge been
included, the return would have been lower): 6.73%
S&P 500 Stock Index(1): 8.15%
Merrill Lynch Government/Corporate Master Index(1)1: 3.98%
Lipper Large Cap Value Funds Average(1): 8.99%
AmSouth Moderate Growth and Income Portfolio
(Class A Shares at NAV. Had the effects of the front-end sales charge been
included, the return would have been lower): 6.03%
S&P 500 Stock Index(1): 8.15%
Merrill Lynch Government/Corporate Master Index(1): 3.98%
Lipper Flexible Portfolio Funds Average(1): 7.54%
With the maximum sales charge of 5.50% and recurring fees, the six-month, 1 Year, 5 Year and Since Inceptions average annual total returns for the Class A Shares for the periods ended January 31, 2005 were 3.87%, 1.11%, -0.53% and 1.60%, respectively, for the Aggressive Growth Portfolio; 2.00%, 0.06%, 0.73% and 1.61%, respectively, for the Growth Portfolio; 0.88%, -0.81%, 2.21% and 2.44%, respectively, for the Growth and Income Portfolio; and 0.22%, -1.28%, 2.95% and 2.83%, respectively, for the Moderate Growth and Income Portfolio. The returns quoted assume reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The
investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Portfolios' performance?
A. The stock market staged a strong rally during the fourth quarter of 2004, helping the Strategic Portfolios generate gains for the six-month period. The Portfolios' returns benefited from their broad diversification in the stock market, including funds that invest in various styles and market-cap sizes as well as international shares.
Above-neutral allocations to stocks throughout the period boosted the Portfolios' returns. The Aggressive Growth Portfolio held 99% of its assets in stock during the period, compared to its neutral allocation of 85%. The Growth, Growth and Income and Moderate Growth and Income Portfolios all held equity allocations ten percentage points higher than their neutral positions.+
The diversification of the Portfolios' equity holdings helped those equity stakes outperform the broad market, as measured by the Standard & Poor's 500 Index. In particular, the Portfolios benefited from their allocations to small and medium-sized stocks, value shares and inter-national equities, all of which generated strong gains during the six-month period.
The bond funds in which the Portfolios invested lagged their bench-marks, weighing down relative returns.
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGERS
John P. Boston, CFA
Chief Fixed Income Officer
Michael T. Lytle, CFA
Fund Manager
AmSouth Bank
AmSouth Asset Management, Inc.
John Boston manages the AmSouth High Quality Bond Fund and co-manages the AmSouth Government Income Fund, AmSouth Limited Term Bond Fund and the AmSouth Balanced Fund. Mr. Boston joined the Asset Management Division in 1987. Mr. Boston earned his B.S. in Finance and Political Science from the University of North Alabama. He is a member and past president of the Alabama Society of Financial Analysts and holds the Chartered Financial Analyst designation.
Michael Lytle co-manages the AmSouth Government Income Fund. He joined the AmSouth Asset management Division in 1999 after completing AmSouth Bank's Management Associate Program. He earned his B.S. in Interdisciplinary Studies from Berry College and holds the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
U.S. Government guarantees apply only to certain underlying securities of the Fund's portfolio and not the Fund's shares.
Bonds offer a relatively stable level of income, although bond prices will fluctuate providing the potential for principal gain or loss. Intermediate-term, higher-quality bonds generally offer less risk than longer-term bonds and a lower rate of return.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 2.00% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 3.53% total return for the Fund's benchmark, the Lehman Brothers Mortgage Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 4.00% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the periods ended January 31, 2005, were -2.07%, -1.99%, 5.21% and 5.91%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance during the period?
This Fund invests primarily in mortgage-backed securities. Such issues fared well during the period, as investors prized their relatively high yields and the protection they offered against rising interest rates. That environment helped the Fund and its benchmark post positive returns.
The Fund began the period with 50% of its assets in mortgage-backed securities, 40% in agency issues and 10% in Treasuries. We maintained those allocations through December. In January we significantly increased the Fund's weighting in mortgage-backed securities, to 82% of the Fund's assets, in order to take advantage of the attractive yields and outlook those bonds offered. This Fund's benchmark is comprised entirely of mortgage-backed securities, so the Fund's smaller weighting dragged on relative returns as those bonds performed well. That dynamic was the primary reason that the Fund lagged its benchmark. +
The Fund held an average duration that was modestly shorter than the benchmark throughout the period, to help protect against rising interest rates. That strategy had a slightly negative impact on returns against the benchmark, as bonds with longer durations generally performed best. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGER
John P. Boston, CFA
Chief Fixed Income Officer
Scott Flurry, CFA
Fund Manager
AmSouth Bank
AmSouth Asset Management, Inc.
John Boston manages the AmSouth High Quality Bond Fund and co-manages the AmSouth Government Income Fund, AmSouth Limited Term Bond Fund and the AmSouth Balanced Fund. Mr. Boston joined the Asset Management Division in 1987. Mr. Boston earned his B.S. in Finance and Political Science from the University of North Alabama. He is a member and past president of the Alabama Society of Financial Analysts and holds the Chartered Financial Analyst designation.
Scott Flurry co-manages the AmSouth Limited Term Bond Fund. Mr. Flurry joined AmSouth Asset Management in 2003. Prior to joining AmSouth, Mr. Flurry managed equity and fixed income portfolios at a large, regional bank since 1993. Mr. Flurry earned his B.S. in Finance from the University of Alabama and holds the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
Short- or intermediate-term investment grade bonds offer less risk and generally a lower rate of return than longer-term higher yielding bonds.
Bonds offer a relatively stable level of income, although bond prices will fluctuate providing the potential for principal gain or loss. Intermediate-term, higher-quality bonds generally offer less risk than longer-term bonds and a lower rate of return.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 0.55% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 1.22% total return for the Fund's benchmark, the Merrill Lynch 1-5-Year Government/Corporate Bond Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 2.00% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the periods ended January 31, 2005, were -3.51%, -3.57%, 4.19% and 5.06%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com
Q. What factors affected the Fund's performance?
The Fund held a shorter average duration than the benchmark throughout the period, in order to protect against the risk of rising interest rates. That strategy hurt relative performance during the first three months, as short-term yields declined. The Fund's relatively short average duration then helped returns against the bench- mark when yields rose during the second half of the recent period. The Fund sacrificed some yield to pursue its low-duration strategy, particularly early in the period when the yield curve was steeper, with higher yields on longer-term issues+
The Fund was overweight corporate bonds during the entire period, which helped relative returns significantly. One- to five-year corporate bonds returned 43 basis points (0.43%) more than the index for the period as a whole. The beneficial effect of the Fund's overweight position in corporate bonds was tempered somewhat by the overall superior credit quality of the Fund, as lower rated corporate bonds were by far the best performers. +
We further increased the Fund's overweight position in corporate bonds during the period. The Fund held 53% of its assets in corporate issues as of August 1, 2004, compared to 60% by the end of the period. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGER
John P. Boston, CFA
Chief Fixed Income Officer
AmSouth Bank
AmSouth Asset Management, Inc.
John Boston manages the AmSouth High Quality Bond Fund and co-manages the AmSouth Government Income Fund, AmSouth Limited Term Bond Fund and the AmSouth Balanced Fund. Mr. Boston joined the Asset Management Division in 1987. Mr. Boston earned his B.S. in Finance and Political Science from the University of North Alabama. He is a member and past president of the Alabama Society of Financial Analysts and holds the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
Bonds offer a relatively stable level of income, although bond prices will fluctuate providing the potential for principal gain or loss. Intermediate-term, higher-quality bonds generally offer less risk than longer-term bonds and a lower rate of return.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 2.94% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 4.02% total return for the Fund's benchmark, the Lehman Brothers Government/Credit Bond Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 4.00% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the periods ended January 31, 2005, were -1.16%, -1.30%, 6.31% and 6.54%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. Yields on short-term bonds rose during the period, while yields on longer-term bonds declined. The decline in long-term bond yields helped the Fund produce positive returns. The Fund benefited from its position in corporate issues, which outperformed Treasury bonds. +
The Fund held an average duration shorter than that of the benchmark throughout the period. We established and maintained that position to protect against a rise in interest rates. That strategy left the Fund underexposed to long-term bonds, so the relative strength of those securities weighed on returns versus the benchmark. +
We lengthened the Fund's duration late in the period to benefit from any further flattening of the yield curve--that is, any further decline in long-term rates relative to short-term rates. That strategy boosted the Fund's relative returns during January. The Fund
began the recent six-month period with an average duration of 4.61 years, and ended the period with an average duration of 5.05 years.+
The Fund held an overweight position in corporate bonds throughout the period. That helped relative returns, as corporate bonds significantly outperformed government-issued securities. The Fund's high-quality focus prevented it from benefiting from even stronger performance among lower-quality corporate bonds, which resulted in the Fund lagging its benchmark. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGER
Dorothy E. Thomas, CFA
Fund Manager
AmSouth Bank
AmSouth Asset Management, Inc.
Dorothy Thomas manages the AmSouth Municipal Bond Fund, AmSouth Florida Tax-Exempt Fund and the AmSouth Tennessee Tax-Exempt Fund. Ms. Thomas joined the Asset Management Division in 1983 after working in Corporate Finance since 1973. Prior to moving to the Fixed Income team, she held positions as an equity analyst and a portfolio manager. She earned a B.A. in Economics from Stanford University and her MBA from the University of Alabama. She is a member of the Alabama Society of Financial Analysts and holds the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
The Fund's income may be subject to certain state and local taxes and, depending on your tax status, the federal alternative minimum tax.
Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer-term issues and in environments of rising interest rates.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 2.01% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower) during the period. In comparison, the Fund's benchmark the Merrill Lynch 1-12-Year Municipal Bond Index(1) returned 3.46%.
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 4.00% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the periods ended January 31, 2005, were -2.10%, -2.59%, 4.57% and 4.49%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund during the period?
A. Yields on long-term municipal bonds declined, while yields on short-term municipal bonds rose. Yields on the four- to five-year securities which we overweighted declined only slightly, so capital appreciation contributed relatively little to Fund gains. Instead, bond yields generated most of the Fund's positive returns. +
The Fund held a shorter average duration than that of the benchmark throughout the period, in order to protect against rising interest rates. That approach weighed on relative returns, since it prevented the Fund from holding many of the longer-term issues that
performed the best. We lengthened the Fund's average duration late in the period in order to obtain additional yield for shareholders. The Fund held an average duration of 3.91 years as of August 1, 2004, and ended the period on January 31, 2005 with an average duration of 4.80 years. +
The Fund held bonds with very high credit quality, in keeping with its high-quality mandate. That had a mildly negative effect on returns against the benchmark, as lower-quality bonds led the market. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGER
Dorothy E. Thomas, CFA
Fund Manager
AmSouth Bank
AmSouth Asset Management, Inc.
Dorothy Thomas manages the AmSouth Municipal Bond Fund, AmSouth Florida Tax-Exempt Fund and the AmSouth Tennessee Tax-Exempt Fund. Ms. Thomas joined the Asset Management Division in 1983 after working in Corporate Finance since 1973. Prior to moving to the Fixed Income team, she held positions as an equity analyst and a portfolio manager. She earned a B.A. in Economics from Stanford University and her MBA from the University of Alabama. She is a member of the Alabama Society of Financial Analysts and holds the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
The geographical concentration of portfolio holdings in this Fund may involve increased risk.
The Fund's income may be subject to certain state and local taxes and, depending on your tax status, the federal alternative minimum tax.
Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer-term issues and in environments of rising interest rates.
Q & A
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 2.29% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). That compared to a 3.46% return for the Fund's benchmark, the Merrill Lynch 1-12-Year Municipal Bond Index.(1)
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 4.00% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the periods ended January 31, 2005, were -1.78%, -2.39%, 4.44% and 4.50%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance?
A. The market for Florida municipal debt was similar to the national municipal market: Yields on long-term municipal bonds fell, while yields on short-term issues rose. This Fund over-weighted securities with durations of between four and five years. Yields on those issues declined only slightly, so capital appreciation was not a major factor in producing Fund returns. +
We maintained a shorter average duration than that of the Fund's benchmark throughout the period, to protect against the potential for rising interest rates. That strategy prevented the Fund from holding many of the longer-term issues that performed the best during the period, hurting the Fund's returns relative to the index. We lengthened the Fund's average duration late in the period in order to capture additional yield. The Fund's holdings had an average duration of 3.86 years as of August 1, 2004, and an average duration of 4.63 years as of January 31, 2005. +
The Fund invests in bonds with high credit quality. Lower-quality bonds led the market, so this Fund's high-quality mandate weighed slightly on relative returns. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGER
Dorothy E. Thomas, CFA
Fund Manager
AmSouth Bank
AmSouth Asset Management, Inc.
Dorothy Thomas manages the AmSouth Municipal Bond Fund, AmSouth Florida Tax-Exempt Fund and the AmSouth Tennessee Tax-Exempt Fund. Ms. Thomas joined the Asset Management Division in 1983 after working in Corporate Finance since 1973. Prior to moving to the Fixed Income team, she held positions as an equity analyst and a portfolio manager. She earned a B.A. in Economics from Stanford University and her MBA from the University of Alabama. She is a member of the Alabama Society of Financial Analysts and holds the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
The geographical concentration of portfolio holdings in this Fund may involve increased risk.
The Fund's income may be subject to certain state and local taxes and, depending on your tax status, the federal alternative minimum tax.
Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer-term issues and in environments of rising interest rates.
Q. How did the Fund perform during the six-month period ended January 31, 2005?
A. The Fund delivered a total return of 1.59% (Class A Shares at NAV. Had the effects of the front-end sales charge been included, the return would have been lower). The Fund's benchmark, the Merrill Lynch 1-12-Year Municipal Bond Index(1), returned 3.46%.
The Fund's total return does not reflect the deduction of a sales charge on Class A Shares. If reflected, the sales charge would reduce the performance quoted.
With the maximum sales charge of 4.00% and recurring fees, the Fund's six month, 1 Year, 5 Year and 10 Year average annual total returns for the periods ended January 31, 2005, were -2.50%, -3.10%, 4.09% and 3.96%, respectively, for Class A Shares. The returns quoted assume the reinvestment of dividends and capital gains distributions.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. Total return figures include change in share price, reinvestment of dividends and capital gains and does not reflect the deduction of taxes that a shareholder would pay on distributions and redemptions. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than the original cost. For performance data current to the most recent month end please visit www.amsouthfunds.com.
Q. What factors affected the Fund's performance during the period?
A. Tennessee municipal bonds generally performed in line with other states' municipal bonds during this period, as yields fell on the long end of the yield curve and rose on the short end. The Fund over-weighted securities with durations between four and five years. Yields in that section of the curve declined only modestly, so the yields produced by the Fund's portfolio were a major factor in generating returns.+
We maintained a relatively short average duration throughout the period, to protect shareholders' capital in case interest rates increased. The Fund held few of the long-term issues that led the market, so the strategy dragged on relative returns for the period as a whole. We lengthened the Fund's average duration late in the period in order to capture additional yield. The Fund's portfolio held securities with an average duration of 3.75 years as of August 1, 2004, and an average duration of 4.39 years as of January 31, 2005. +
This Fund's mandate calls for it to maintain a portfolio with high credit quality. High-quality bonds lagged lower-quality issues during this period, so the Fund's emphasis on high-quality securities dragged modestly on relative returns. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
(1) See Glossary of Terms for additional information.
PORTFOLIO MANAGERS
Christine Taylor
Fund Manager
Kristie K. Jones
Fund Manager
AmSouth Bank
AmSouth Asset Management, Inc.
Ms. Taylor manages the taxable AmSouth Money Market mutual funds. She joined the AmSouth Asset Management Division in 2002 after completing AmSouth Bank's Management Associate Program. Prior to moving to the Fixed Income team, she was a portfolio manager managing personal portfolios at AmSouth. She earned a B.S. in Finance from the University of South Alabama. Ms. Taylor holds a Series 65 license and is a Level II candidate for the Chartered Financial Analyst designation.
Ms. Jones manages the AmSouth Tax-Exempt Money Market Fund. Prior to moving to the Fixed Income team, she was a portfolio manager managing personal portfolios at AmSouth. She earned her B.S. in Finance with a concentration in Real Estate from the University of Alabama. She holds her Series 7 and Series 65 licenses. Ms. Jones is currently a candidate for Level II of the Chartered Financial Analyst designation.
INVESTMENT CONCERNS
Investments in the Prime, the Treasury Reserve, the Tax-Exempt, and the Institutional Prime Obligations Money Market Funds are neither insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Funds.
The AmSouth Tax Exempt Money Market Fund's income may be subject to certain state and local taxes and, depending on one's tax status, the federal alternative minimum tax.
Q. What factors affected the Funds' performance during the six-month period ended January 31, 2005?
A. The Federal Reserve Board raised its target short-term interest rate four times, for a total increase of one percentage point. Those increases pushed up yields on short-term debt. Rising short-term yields allowed the Funds to capture additional yield for shareholders as the period progressed.
The Funds' investments had average maturities shorter than those of their benchmarks throughout the period. That strategy provided the flexibility to invest in higher-yielding securities as rates rose, while protecting shareholders' capital. The Funds' relatively short average maturities boosted performance against their benchmarks. +
These Funds, except for the Tax-Exempt Money Market Fund, focus on high-quality fixed- and variable-rate securities. A limited supply of high-quality commercial paper prevented the Funds from adding multiple new commercial paper names to the portfolios. The Funds found opportunities in overnight repurchase agreements, which adjust their yields on a day-to-day basis and therefore reflected changes in Federal Reserve policy. The Tax-Exempt Money Market Fund emphasized variable-rate securities, which benefited from the rising-rate environment. +
o As of January 31, 2005, the Prime Obligations Fund's average maturity was 28 days, compared with 28 days on July 31, 2004 and 59 days on January 31, 2004. +
o As of January 31, 2005, the Tax-Exempt Fund's average maturity was 20 days, compared with 19 days on July 31, 2004 and 35 days on January 31, 2004. +
o As of January 31, 2005, the Treasury Reserve Fund's average maturity was 19 days, compared with 22 days on July 31, 2004 and 45 days on January 31, 2004. +
o As of January 31, 2005, the Institutional Prime Obligations Fund's average maturity was 27 days, compared with 29 days on July 31, 2004 and 64 days on January 31, 2004. +
+ The Fund's portfolio is current to January 31, 2005 and subject to change.
PIONEER BOND FUND
STATEMENT OF ADDITIONAL INFORMATION
[ ], 2005
This Statement of Additional Information is not a Prospectus. It should be read in conjunction with the related combined Proxy Statement and Prospectus (also dated [ ], 2005), which covers Class A, B and Y shares of Pioneer Bond Fund to be issued in exchange for shares of AmSouth High Quality Bond Fund, a series of AmSouth Funds. Please retain this Statement of Additional Information for further reference.
The Prospectus is available to you free of charge (please call 1-800-225-6292).
INTRODUCTION..........................................................2
EXHIBITS AND DOCUMENTS INCORPORATED BY REFERENCE......................2
ADDITIONAL INFORMATION ABOUT PIONEER BOND FUND........................2
FUND HISTORY....................................................2
DESCRIPTION OF THE FUND AND ITS INVESTMENT RISKS................2
MANAGEMENT OF THE FUND..........................................2
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES.............3
INVESTMENT ADVISORY AND OTHER SERVICES..........................3
PORTFOLIO MANAGERS..............................................3
BROKERAGE ALLOCATION AND OTHER PRACTICES........................3
CAPITAL STOCK AND OTHER SECURITIES..............................3
PURCHASE, REDEMPTION AND PRICING OF SHARES......................3
TAXATION OF THE FUND............................................3
UNDERWRITERS....................................................3
CALCULATION OF PERFORMANCE DATA.................................3
FINANCIAL STATEMENTS............................................3
|
INTRODUCTION
This Statement of Additional Information is intended to supplement the information provided in a combined Proxy Statement and Prospectus dated [ ], 2005 (the "Proxy Statement and Prospectus") relating to the proposed reorganization of AmSouth High Quality Bond Fund, a series of AmSouth Funds, into Pioneer Bond Fund, and in connection with the solicitation by the management of AmSouth Funds of proxies to be voted at the Meeting of Shareholders of AmSouth High Quality Bond Fund to be held on [ ], 2005.
EXHIBITS AND DOCUMENTS INCORPORATED BY REFERENCE
The following documents are incorporated herein by reference, unless otherwise indicated. Shareholders will receive a copy of each document that is incorporated by reference upon any request to receive a copy of this Statement of Additional Information.
1. Pioneer Bond Fund's statement of additional information for Class A, B, C, Y and R shares, dated October 28, 2004 (the "SAI") (File No. 002-62436), as filed with the Securities and Exchange Commission on December 16, 2004 (Accession No. 0001016964-04-000519), is incorporated herein by reference.
2. Pioneer Bond Fund's Annual Report for the fiscal year ended June 30, 2004 (File No. 811-02864), as filed with the Securities and Exchange Commission on September 2, 2004 (Accession No. 0000276776-04-000015), is incorporated herein by reference.
3. Pioneer Bond Fund's Semi-Annual Report for the period ended December 31, 2004 (File No. 811-02864), as filed with the Securities and Exchange Commission on March 11, 2005 (Accession No. 0000908996-05-000017), is incorporated herein by reference.
4. AmSouth Fund's statement of additional information, dated December 1, 2004 (File No. 33-21660), as filed with the Securities and Exchange Commission on December 8, 2004 (Accession No. 0000898432-04-001009), is incorporated herein by reference.
5. AmSouth High Quality Bond Fund's Annual Report for the fiscal year ended July 31, 2004 (File No. 81105551), as filed with the Securities and Exchange Commission on October 12, 2004 (Accession No. 0001145443-04-001533), is incorporated by reference.
6. AmSouth High Quality Bond Fund's Semi-Annual Report for the period ended January 31, 2005 (File No. 811-05551), as filed with the Securities and Exchange Commission on April 11, 2005 (Accession No. 0001206774-05-000567), is incorporated herein by reference.
ADDITIONAL INFORMATION ABOUT
PIONEER BOND FUND
FUND HISTORY
For additional information about Pioneer Bond Fund generally and its history, see "Fund History" in the SAI.
DESCRIPTION OF THE FUND AND ITS INVESTMENT RISKS
For additional information about Pioneer Bond Fund's investment objective, policies, risks and restrictions, see "Investment Policies, Risks and Restrictions" in the SAI.
MANAGEMENT OF THE FUND
For additional information about Pioneer Bond Fund's Board of Trustees and officers, see "Trustees and Officers" in the SAI.
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
For additional information, see "Annual Fee, Expense and Other Information
- Share ownership."
INVESTMENT ADVISORY AND OTHER SERVICES
For additional information, see "Investment Adviser," "Shareholder Servicing/Transfer Agent," "Custodian" and "Independent Auditors" in Pioneer Bond Fund's SAI.
PORTFOLIO MANAGERS
For addition information, see "Portfolio Management" in Pioneer Bond Fund's SAI.
BROKERAGE ALLOCATION AND OTHER PRACTICES
For additional information about Pioneer Bond Fund's brokerage allocation practices, see "Portfolio Transactions" in the SAI.
CAPITAL STOCK AND OTHER SECURITIES
For additional information about the voting rights and other characteristics of shares of beneficial interest of Pioneer Bond Fund, see "Description of Shares" in the SAI.
PURCHASE, REDEMPTION AND PRICING OF SHARES
For additional information about purchase, redemption and pricing of shares of Pioneer Bond Fund, see "Sales Charges," "Redeeming Shares," "Telephone and Online Transactions" and "Pricing of Shares" in the SAI.
TAXATION OF THE FUND
For additional information about tax matters related to an investment in Pioneer Bond Fund, see "Tax Status" in the SAI.
UNDERWRITERS
For additional information about Pioneer Bond Fund's principal underwriter and distribution plans, see "Principal Underwriter and Distribution Plans" and "Sales Charges" in the SAI.
CALCULATION OF PERFORMANCE DATA
For additional information about the investment performance of Pioneer Bond Fund, see "Investment Results" in the SAI.
FINANCIAL STATEMENTS
For additional information, see "Financial Statements" in Pioneer Bond Fund's SAI.
PIONEER BOND FUND
PRO FORMA
Schedule of Investments (a)
June 30, 2004
(Unaudited)
Pioneer AmSouth Pioneer AmSouth
Bond High Quality Pro Forma % of Bond High Quality Pro Forma
Fund Bond Fund Combined Pro Forma Fund Bond Fund Combined
Principal Principal Principal Combined Market Market Market
Amount Amount Amount Net Assets Value Value Value
------ ------ ------ ---------- ----- ----- -----
ASSET BACKED SECURITIES 1.43%
Diversified Financials 0.98%
1,976,000 1,976,000 PF Export Receivable Master Trust, 6.436%,
6/1/15 (144A) $ 1,948,553 $ $ 1,948,553
1,425,328 1,425,328 Power Receivables Finance, 6.29%, 1/1/12
(144A) 1,451,369 1,451,369
5,000,000 5,000,000 Sears Credit Account Master Trust, 6.75%,
09/16/09 5,237,450 5,237,450
-----------------------------------------
Total Diversified Financials $ 3,399,922 $ 5,237,450 $ 8,637,372
-----------------------------------------
Real Estate 0.24%
Real Estate Investment Trusts 0.24%
2,175,000 2,175,000 Global Signal Trust, 5.395%, 1/15/34 (144A) $ 2,089,888 $ $ 2,089,888
-----------------------------------------
Total Real Estate $ 2,089,888 $ $ 2,089,888
-----------------------------------------
Utilities 0.21%
Electric Utilities 0.21%
1,800,000 1,800,000 Empresa Electric Guacolda, 8.625%, 4/30/13 $ 1,867,894 $ $ 1,867,894
-----------------------------------------
Total Utilities $ 1,867,894 $ $ 1,867,894
-----------------------------------------
TOTAL ASSET BACKED SECURITIES $ 7,357,704 $ 5,237,450 $ 12,595,154
-----------------------------------------
COLLATERIZED MORTGAGE OBLIGATIONS 0.69%
Insurance 0.69%
Life & Health Insurance 0.57%
5,000,000 5,000,000 Asif Global Financing, 3.85%, 11/26/07 $ $ 5,024,710 $ 5,024,710
-----------------------------------------
Multi-Line Insurance 0.12%
1,000,000 1,000,000 National Realty Finance 1999-A2, 6.48%,
1/15/09 $ 1,079,942 $ $ 1,079,942
-----------------------------------------
Total Insurance $ 1,079,942 $ 5,024,710 $ 6,104,652
-----------------------------------------
TOTAL COLLATERIZED MORTGAGE OBLIGATIONS $ 1,079,942 $ 5,024,710 $ 6,104,652
-----------------------------------------
CORPORATE BONDS 48.80%
Energy 1.34%
Oil & Gas Exploration & Production 0.99%
1,000,000 1,000,000 Cie Generale De Geophysique SA, 10.625%,
11/15/07 $ 1,065,000 $ $ 1,065,000
1,000,000 1,000,000 Conoco, Inc., 6.35%, 04/15/09 1,087,787 1,087,787
2,000,000 2,000,000 ConocoPhillips, 6.375%, 03/30/09 2,172,500 2,172,500
4,000,000 4,000,000 Texaco Capital, Inc., 7.09%, 02/01/07 4,365,000 4,365,000
-----------------------------------------
$ 1,065,000 $ 7,625,287 $ 8,690,287
-----------------------------------------
Oil & Gas Refining Marketing & Transportation 0.36%
1,375,000 1,375,000 Semco Energy Inc., 7.125%, 5/15/08 $ 1,409,375 $ $ 1,409,375
1,750,000 1,750,000 Magellan Midstream Partners, L.P., 6.45%,
6/1/14 1,757,861 1,757,861
-----------------------------------------
$ 3,167,236 $ $ 3,167,236
-----------------------------------------
Total Energy $ 4,232,236 $ 7,625,287 $ 11,857,523
-----------------------------------------
Materials 3.34%
Aluminum 0.52%
4,000,000 4,000,000 Alcoa, Inc., 7.375%, 08/01/10 $ $ 4,546,760 $ 4,546,760
-----------------------------------------
|
Commodity Chemicals 0.31%
1,100,000 1,100,000 Methanex Corp., 8.75%, 8/15/12 $ 1,237,500 $ $ 1,237,500
1,500,000 1,500,000 Nova Chemicals Ltd., 6.5%, 1/15/12 1,477,500 1,477,500
-----------------------------------------
$ 2,715,000 $ $ 2,715,000
-----------------------------------------
Construction Materials 0.24%
2,000,000 2,000,000 Vulcan Materials Co., 6.00%, 04/01/09 $ $ 2,144,350 $ 2,144,350
-----------------------------------------
Diversified Chemicals 0.43%
1,000,000 1,000,000 Huntsman ICI Chemicals, 10.125%, 7/1/09 $ 1,020,000 $ $ 1,020,000
2,500,000 2,500,000 PPG Industries, Inc., 7.05%, 08/15/09 2,796,875 2,796,875
-----------------------------------------
$ 1,020,000 $ 2,796,875 $ 3,816,875
-----------------------------------------
Diversified Metals & Mining 0.31%
2,575,000 2,575,000 Kennametal Inc., 7.2%, 6/15/12 $ 2,723,369 $ $ 2,723,369
-----------------------------------------
Metal & Glass Containers 0.36%
1,000,000 1,000,000 Ball Corp., 6.875%, 12/15/12 $ 1,015,000 $ $ 1,015,000
2,000,000 2,000,000 Greif Brothers Corp., 8.875%, 8/1/12 2,152,500 2,152,500
-----------------------------------------
$ 3,167,500 $ $ 3,167,500
-----------------------------------------
Paper Packaging 0.23%
1,125,000 1,125,000 Abitibi-Consolidated, Inc., 6.95%, 12/15/06 $ 1,152,980 $ $ 1,152,980
800,000 800,000 Stone Container Corp., 9.75%, 2/1/11 880,000 880,000
-----------------------------------------
$ 2,032,980 $ $ 2,032,980
-----------------------------------------
Paper Products 0.15%
1,300,000 1,300,000 Bowater Canada Finance, 7.95%, 11/15/11 $ 1,342,870 $ $ 1,342,870
-----------------------------------------
Specialty Chemicals 0.52%
500,000 500,000 Ferro Corp., 7.125%, 4/1/28 $ 503,639 $ $ 503,639
2,000,000 2,000,000 Ferro Corp., 9.125%, 1/1/09 2,296,724 2,296,724
1,750,000 1,750,000 OM Group Inc., 9.25%, 12/15/11 1,793,750 1,793,750
-----------------------------------------
$ 4,594,113 $ $ 4,594,113
-----------------------------------------
Steel 0.27%
1,400,000 1,400,000 Ispat Inland ULC, 9.75%, 4/1/14 (144A) $ 1,442,000 $ $ 1,442,000
1,000,000 1,000,000 International Steel Group, 6.5%, 4/15/14
(144A) 937,500 937,500
-----------------------------------------
$ 2,379,500 $ $ 2,379,500
-----------------------------------------
Total Materials $ 19,975,332 $ 9,487,985 $ 29,463,317
-----------------------------------------
Capital Goods 5.37%
Aerospace & Defense 1.23%
1,500,000 1,500,000 L-3 Communication Corp., 7.625%, 6/15/12 $ 1,582,500 $ $ 1,582,500
500,000 500,000 L-3 Communications Corp., 6.125%, 7/15/13 482,500 482,500
2,145,000 2,145,000 McDonnell Douglas Corp., 6.875%, 11/01/06 2,297,831 2,297,831
850,000 850,000 Precision Castparts Corp., 5.6%, 12/15/13 827,513 827,513
5,000,000 5,000,000 United Technologies Corp., 7.125%, 11/15/10 5,671,725 5,671,725
-----------------------------------------
$ 2,892,513 $ 7,969,556 $ 10,862,069
-----------------------------------------
Building Products 0.27%
1,500,000 1,500,000 NCI Building Systems, Inc., 9.25%, 5/1/09 $ 1,575,000 $ $ 1,575,000
787,000 787,000 Smith Enron, 5.97%, 12/15/06 790,741 790,741
-----------------------------------------
$ 1,575,000 $ 790,741 $ 2,365,741
-----------------------------------------
Construction & Farm Machinery & Heavy Trucks 0.23%
2,100,000 2,100,000 Caterpillar Financial Services Corp., 2.50%,
10/03/06 $ $ 2,064,428 $ 2,064,428
-----------------------------------------
Electrical Component & Equipment 2.37%
1,500,000 1,500,000 Emerson Electric, 6.30%, 11/01/05 $ $ 1,569,375 $ 1,569,375
12,000,000 12,000,000 General Electric Co., 5.00%, 02/01/13 11,830,416 11,830,416
1,000,000 1,000,000 MSW Energy Holdings, 7.375%, 9/1/10 (144A) 995,000 995,000
3,456,000 3,456,000 Rockwell International Corp., 6.625%,
06/01/05 3,568,320 3,568,320
2,750,000 2,750,000 Thomas & Betts Corp., 7.25%, 6/1/13 2,912,852 2,912,852
-----------------------------------------
$ 3,907,852 $ 16,968,111 $ 20,875,963
-----------------------------------------
Industrial Machinery 1.27%
2,300,000 2,300,000 Caterpillar, Inc., 3.1%, 05/15/07 $ $ 2,272,883 $ 2,272,883
1,000,000 1,000,000 Caterpillar, Inc., 6.55%, 05/01/11 1,108,750 1,108,750
|
2,000,000 2,000,000 Honeywell, Inc., 7.00%, 03/15/07 2,176,102 2,176,102
1,950,000 1,950,000 JLG Industries Inc., 8.375%, 6/15/12 1,984,125 1,984,125
800,000 800,000 The Manitowoc Co., Inc., 10.5%, 8/1/12 916,000 916,000
2,775,000 2,775,000 Timken Co., 5.75%, 2/15/10 2,780,816 2,780,816
-----------------------------------------
$ 5,680,941 $ 5,557,735 $ 11,238,676
-----------------------------------------
Total Capital Goods $ 14,056,306 $ 33,350,572 $ 47,406,878
-----------------------------------------
Transportation 0.20%
Airlines 0.20%
1,548,465 1,548,465 Southwest Airlines Co., 7.67%, 1/2/14 $ 1,724,293 $ $ 1,724,293
-----------------------------------------
Total Transportation $ 1,724,293 $ $ 1,724,293
-----------------------------------------
Automobiles & Components 1.11%
Auto Parts & Equipment 0.02%
150,000 150,000 Lear Corp., 7.96%, 5/15/05 (144A) $ 156,408 $ $ 156,408
-----------------------------------------
Automobile Manufacturers 1.09%
2,000,000 2,000,000 General Motors Acceptance Corp., 6.15%,
04/07/07 $ $ 2,090,000 $ 2,090,000
3,000,000 3,000,000 General Motors Acceptance Corp., 7.50%,
07/15/05 3,135,000 3,135,000
500,000 500,000 General Motors Capital Corp., 7.5%, 7/15/05 522,308 522,308
1,500,000 1,500,000 Hertz Corp., 6.25%, 3/15/09 1,528,455 1,528,455
360,000 360,000 Hertz Corp., 7.4%, 3/1/11 377,956 377,956
2,000,000 2,000,000 Hyundai Motor Co Ltd., 5.3%, 12/19/08 1,968,170 1,968,170
-----------------------------------------
$ 4,396,889 $ 5,225,000 $ 9,621,889
-----------------------------------------
Total Automobiles & Components $ 4,553,297 $ 5,225,000 $ 9,778,297
-----------------------------------------
Hotels Restaurants & Leisure 0.38%
1,885,000 1,885,000 Hilton Hotels, 7.625%, 12/1/12 $ 2,026,375 $ $ 2,026,375
1,200,000 1,200,000 John Q Hamons Hotels, 8.875%, 5/15/12 1,302,000 1,302,000
-----------------------------------------
Total Hotels Restaurants & Leisure $ 3,328,375 $ $ 3,328,375
-----------------------------------------
Consumer Services 0.98%
Restaurants 0.98%
5,500,000 5,500,000 McDonald's Corp., 5.35%, 09/15/08 $ $ 5,775,000 $ 5,775,000
2,000,000 2,000,000 McDonald's Corp., 5.375%, 04/30/07 2,095,420 2,095,420
700,000 700,000 McDonald's Corp., 6.00%, 04/15/11 744,625 744,625
-----------------------------------------
Total Consumer Services $ $ 8,615,045 $ 8,615,045
-----------------------------------------
Media 1.23%
Broadcasting & Cable Tv 0.30%
2,500,000 2,500,000 Rogers Cable Inc., 7.875%, 5/1/12 $ 2,635,168 $ $ 2,635,168
-----------------------------------------
Movies & Entertainment 0.15%
1,250,000 1,250,000 AOL Time Warner, Inc., 6.875%, 5/1/12 $ 1,350,741 $ $ 1,350,741
-----------------------------------------
Publishing 0.78%
2,800,000 2,800,000 New York Times Co., 4.625%, 06/25/07 $ $ 2,901,069 $ 2,901,069
2,000,000 2,000,000 New York Times Co., 7.625%, 03/15/05 2,077,500 2,077,500
1,550,000 1,550,000 News America Holdings, 8.5%, 2/23/25 1,866,392 1,866,392
-----------------------------------------
$ 1,866,392 $ 4,978,569 $ 6,844,961
-----------------------------------------
Total Media $ 5,852,301 $ 4,978,569 $ 10,830,870
-----------------------------------------
Retailing 1.78%
Apparel Retail 0.42%
3,500,000 3,500,000 Nike, Inc., 5.50%, 08/15/06 $ $ 3,683,985 $ 3,683,985
-----------------------------------------
Department Stores 0.44%
850,000 850,000 J.C. Penney Co. Inc., 7.125%, 11/15/23 $ 871,250 $ $ 871,250
893,000 893,000 J.C. Penney Co. Inc., 9.75%, 6/15/21 919,790 919,790
1,000,000 1,000,000 May Department Stores Co., 7.15%, 08/15/04 1,005,000 1,005,000
|
1,000,000 1,000,000 May Department Stores Co., 7.90%, 10/15/07 1,110,290 1,110,290
-----------------------------------------
$ 1,791,040 $ 2,115,290 $ 3,906,330
-----------------------------------------
General Merchandise Stores 0.65%
3,500,000 3,500,000 Target Corp., 5.875%, 03/01/12 $ $ 3,705,625 $ 3,705,625
2,000,000 2,000,000 Target Corp., 7.50%, 02/15/05 2,062,500 2,062,500
-----------------------------------------
$ $ 5,768,125 $ 5,768,125
-----------------------------------------
Specialty Stores 0.27%
580,000 580,000 Toys R Us 7.375%, 10/15/18 $ 535,775 $ $ 535,775
1,825,000 1,825,000 Toys R Us, 7.875%, 4/15/13 1,831,844 1,831,844
-----------------------------------------
$ 2,367,619 $ $ 2,367,619
-----------------------------------------
Total Retailing $ 4,158,659 $ 11,567,400 $ 15,726,059
-----------------------------------------
Food & Staples Retailing 0.95%
Food Distributors 0.29%
2,500,000 2,500,000 Sysco Corp., 4.75%, 07/30/05 $ $ 2,550,000 $ 2,550,000
-----------------------------------------
Hypermarkets & Supercenters 0.66%
1,000,000 1,000,000 Wal-Mart Stores, Inc., 8.62%, 1/1/10 $ 1,088,590 $ $ 1,088,590
4,500,000 4,500,000 Wal-Mart Stores, Inc., 5.45%, 08/01/06 4,712,463 4,712,463
-----------------------------------------
$ 1,088,590 $ 4,712,463 $ 5,801,053
-----------------------------------------
Total Food & Staples Retailing $ 1,088,590 $ 7,262,463 $ 8,351,053
-----------------------------------------
Food Beverage & Tobacco 3.53%
Packaged Foods & Meats 2.21%
7,000,000 7,000,000 Hormel Foods Corp., 6.625%, 06/01/11 $ $ 7,796,250 $ 7,796,250
5,625,000 5,625,000 Sara Lee Corp., 6.15%, 06/19/08 6,005,728 6,005,728
5,000,000 5,000,000 Unilever Capital Corp., 7.125%, 11/01/10 5,663,725 5,663,725
-----------------------------------------
$ $ 19,465,703 $ 19,465,703
-----------------------------------------
Soft Drinks 1.10%
5,500,000 5,500,000 Bottling Group LLC, 2.45%, 10/16/06 $ $ 5,418,919 $ 5,418,919
4,000,000 4,000,000 Coca-Cola Co., 5.75%, 03/15/11 4,255,000 4,255,000
-----------------------------------------
$ $ 9,673,919 $ 9,673,919
-----------------------------------------
Tobacco 0.23%
1,975,000 1,975,000 Altria Group Inc., 7.0%, 11/4/13 $ 2,011,188 $ $ 2,011,188
-----------------------------------------
Total Food Beverage & Tobacco $ 2,011,188 $ 29,139,622 $ 31,150,810
-----------------------------------------
Household & Personal Products 0.79%
Household Products 0.58%
500,000 500,000 Clorox Co., 6.125%, 02/01/11 $ $ 539,538 $ 539,538
4,400,000 4,400,000 Colgate-Palmolive Co., 5.34%, 03/27/06 4,587,000 4,587,000
-----------------------------------------
$ $ 5,126,538 $ 5,126,538
-----------------------------------------
Personal Products 0.21%
1,700,000 1,700,000 Kimberly-Clark Corp., 7.10%, 08/01/07 $ $ 1,882,750 $ 1,882,750
-----------------------------------------
Total Household & Personal Products $ $ 7,009,288 $ 7,009,288
-----------------------------------------
Health Care Equipment & Services 0.51%
Health Care Facilities 0.30%
2,660,000 2,660,000 HCA, Inc., 6.3%, 10/1/12 $ 2,661,365 $ $ 2,661,365
-----------------------------------------
Health Care Supplies 0.21%
1,874,000 1,874,000 Bausch & Lomb, 7.125%, 8/1/28 $ 1,876,219 $ $ 1,876,219
-----------------------------------------
Total Health Care Equipment & Services $ 4,537,584 $ $ 4,537,584
-----------------------------------------
Pharmaceuticals & Biotechnology 2.07%
Pharmaceuticals 2.07%
4,000,000 4,000,000 Abbott Laboratories, 5.63%, 07/01/06 $ $ 4,200,000 $ 4,200,000
6,000,000 6,000,000 Eli Lilly & Co., 5.50%, 07/15/06 6,300,000 6,300,000
1,000,000 1,000,000 GlaxoSmithKline Capital PLC, 2.375%, 04/16/07 973,010 973,010
3,900,000 3,900,000 Pfizer, Inc., 5.625%, 02/01/06 4,070,625 4,070,625
|
2,600,000 2,600,000 Pharmacia Corp., 5.75%, 12/01/05 2,710,500 2,710,500
-----------------------------------------
Total Pharmaceuticals & Biotechnology $ $ 18,254,135 $ 18,254,135
-----------------------------------------
Banks 4.68%
Regional Banks 4.23%
1,100,000 1,100,000 Bank of America Corp., 7.75%, 08/15/15 $ $ 1,277,375 $ 1,277,375
1,000,000 1,000,000 Bank One Texas NA, 6.25%, 02/15/08 1,073,312 1,073,312
3,157,000 3,157,000 Bank One Texas NA, 7.00%, 07/15/05 3,299,065 3,299,065
4,500,000 4,500,000 Branch Banking & Trust, 4.875%, 01/15/13 4,361,553 4,361,553
1,000,000 1,000,000 Fifth Third Bank, 2.70%, 01/30/07 986,409 986,409
4,000,000 4,000,000 Fifth Third Bank, 6.75%, 07/15/05 4,165,000 4,165,000
2,100,000 2,100,000 FleetBoston Financial Corp., 4.875%, 12/01/06 2,173,500 2,173,500
1,250,000 1,250,000 Hudson United Bank, 7.0%, 5/15/12 1,361,910 1,361,910
5,500,000 5,500,000 SunTrust Banks, Inc., 6.375%, 04/01/11 5,968,001 5,968,001
3,159,000 3,159,000 SunTrust Banks, Inc., 7.375%, 07/01/06 3,414,907 3,414,907
2,000,000 2,000,000 U.S. Bank NA, 3.75%, 02/06/09 1,960,612 1,960,612
1,875,000 1,875,000 Wachovia Corp., 6.605%, 10/01/25 1,987,500 1,987,500
5,000,000 5,000,000 Wachovia Corp., 6.875%, 09/15/05 5,256,250 5,256,250
-----------------------------------------
$ 1,361,910 $ 35,923,484 $ 37,285,394
-----------------------------------------
Thrifts & Mortgage Finance 0.45%
2,125,000 2,125,000 Countrywide Home Loan, 6.84%, 10/22/04 $ $ 2,156,875 $ 2,156,875
1,900,000 1,900,000 Sovereign Bank, 5.125%, 3/15/13 1,806,148 1,806,148
-----------------------------------------
$ 1,806,148 $ 2,156,875 $ 3,963,023
-----------------------------------------
Total Banks $ 3,168,058 $ 38,080,359 $ 41,248,417
-----------------------------------------
Diversified Financials 8.80%
Asset Management & Custody Banks 1.67%
2,000,000 2,000,000 Mellon Funding Corp., 6.40%, 05/14/11 $ $ 2,177,500 $ 2,177,500
6,000,000 6,000,000 Northern Trust Co., 7.10%, 08/01/09 6,704,292 6,704,292
5,000,000 5,000,000 State Street Corp., 7.65%, 06/15/10 5,827,460 5,827,460
-----------------------------------------
$ $ 14,709,252 $ 14,709,252
-----------------------------------------
Consumer Finance 3.10%
6,251,000 6,251,000 Boeing Capital Corp., 7.375%, 09/27/10 $ $ 7,077,182 $ 7,077,182
3,000,000 3,000,000 CitiFinancial Credit Co., 6.50%, 08/01/04 3,010,596 3,010,596
3,485,000 3,485,000 Ford Motor Credit Co., 6.25%, 12/08/05 3,601,849 3,601,849
5,000,000 5,000,000 HSBC Finance Corp., 6.50%, 01/24/06 5,272,225 5,272,225
3,100,000 3,100,000 National Rural Utilities Corp., 6.375%,
10/15/04 3,138,750 3,138,750
5,000,000 5,000,000 Toyota Motor Credit Corp., 5.65%, 01/15/07 5,262,500 5,262,500
-----------------------------------------
$ $ 27,363,102 $ 27,363,102
-----------------------------------------
Investment Banking & Brokerage 1.42%
2,800,000 2,800,000 Bear Stearns Cos., Inc., 4.00%, 01/31/08 $ $ 2,792,812 $ 2,792,812
2,910,000 2,910,000 Bear Stearns Cos., Inc., 6.625%, 10/01/04 2,946,375 2,946,375
950,000 950,000 E*Trade Financial Corp., 8.0%, 6/15/11 (144A) 945,250 945,250
6,000,000 6,000,000 Lehman Brothers Holdings, Inc., 3.50%,
08/07/08 5,823,000 5,823,000
-----------------------------------------
$ 945,250 $ 11,562,187 $ 12,507,437
-----------------------------------------
Other Diversified Finance Services 1.61%
2,450,000 2,450,000 Brascan Corp., 5.75%, 3/1/10 $ 2,519,786 $ $ 2,519,786
2,250,000 2,250,000 Glencore Funding LLC, 6.0%, 4/15/14 (144A) 2,086,965 2,086,965
3,856,000 3,856,000 J.P. Morgan & Co., 7.625%, 09/15/04 3,900,961 3,900,961
3,500,000 3,500,000 Morgan Stanley, 6.50%, 11/01/05 3,683,750 3,683,750
2,000,000 2,000,000 Wells Fargo Financial, Inc., 6.625%, 07/15/04 2,002,500 2,002,500
-----------------------------------------
$ 4,606,751 $ 9,587,211 $ 14,193,962
-----------------------------------------
Specialized Finance 1.01%
2,100,000 2,100,000 GATX Financial Corp., 8.875%, 6/1/09 $ 2,356,112 $ $ 2,356,112
6,000,000 6,000,000 Prudential Funding LLC, 6.60%, 05/15/08 6,547,500 6,547,500
-----------------------------------------
$ 2,356,112 $ 6,547,500 $ 8,903,612
-----------------------------------------
Total Diversified Financials $ 7,908,113 $ 69,769,252 $ 77,677,365
-----------------------------------------
|
Insurance 4.20%
Insurance Brokers 0.18%
1,500,000 1,500,000 Marsh & McLennan Cos., Inc., 5.375%, 06/15/07 $ $ 1,572,473 $ 1,572,473
-----------------------------------------
Life & Health Insurance 1.20%
5,000,000 5,000,000 John Hancock Financial Services, Inc.,
5.625%, 12/01/08 $ $ 5,262,500 $ 5,262,500
1,000,000 1,000,000 MetLife, Inc., 6.125%, 12/01/11 1,075,000 1,075,000
1,500,000 1,500,000 Presidential Life Corp., 7.875%, 2/15/09 1,505,625 1,505,625
2,850,000 2,850,000 Provident Companies Inc., 7.0%, 7/15/18 2,714,072 2,714,072
-----------------------------------------
$ 4,219,697 $ 6,337,500 $ 10,557,197
-----------------------------------------
Multi-Line Insurance 0.72%
1,700,000 1,700,000 Allmerica Financial Corp., 7.625%, 10/15/25 $ 1,598,000 $ $ 1,598,000
3,000,000 3,000,000 Berkshire Hathaway, Inc., 3.375%, 10/15/08 2,916,699 2,916,699
1,950,000 1,950,000 Loews Corp., 5.25%, 3/15/16 1,817,306 1,817,306
-----------------------------------------
$ 3,415,306 $ 2,916,699 $ 6,332,005
-----------------------------------------
Property & Casualty Insurance 1.82%
1,000,000 1,000,000 Allstate Financial Global Fund, 7.125%,
09/26/05 $ $ 1,052,839 $ 1,052,839
1,325,000 1,325,000 Arch Capital Group Ltd., 7.35%, 5/1/34 1,333,770 1,333,770
1,000,000 1,000,000 Chubb Corp., 6.00%, 11/15/11 1,053,750 1,053,750
1,000,000 1,000,000 Chubb Corp., 6.15%, 08/15/05 1,036,250 1,036,250
2,010,000 2,010,000 Kingsway America Inc., 7.5%, 2/1/14 1,975,426 1,975,426
9,125,000 9,125,000 St. Paul Cos., Inc., 5.75%, 03/15/07 9,562,042 9,562,042
-----------------------------------------
$ 3,309,196 $ 12,704,881 $ 16,014,077
-----------------------------------------
Reinsurance 0.29%
2,400,000 2,400,000 Odyssey Re Holdings, 7.65%, 11/1/13 $ 2,579,921 $ $ 2,579,921
-----------------------------------------
Total Insurance $ 13,524,120 $ 23,531,552 $ 37,055,672
-----------------------------------------
Real Estate 0.89%
Real Estate Management & Development 0.25%
2,200,000 2,200,000 Forest City Enterprises, 7.625%, 6/1/15 $ 2,211,000 $ $ 2,211,000
-----------------------------------------
Real Estate Investment Trusts 0.64%
1,100,000 1,100,000 Colonial Reality LP, 6.15%, 4/15/13 $ 1,117,629 $ $ 1,117,629
935,000 935,000 Health Care REIT, Inc., 8.0%, 9/12/12 1,050,033 1,050,033
1,450,000 1,450,000 Hospitality Properties Trust, 6.75%, 2/15/13 1,505,357 1,505,357
750,000 750,000 Mack-Cali Realty Corp., 4.6%, 6/15/13 694,995 694,995
1,250,000 1,250,000 Meristar Hospitality Corp., 9.125%, 1/15/11 1,262,500 1,262,500
-----------------------------------------
$ 5,630,514 $ $ 5,630,514
-----------------------------------------
Total Real Estate $ 7,841,514 $ $ 7,841,514
-----------------------------------------
Software & Services 0.82%
Data Processing & Outsourced Services 0.82%
7,000,000 7,000,000 First Data Corp., 4.70%, 11/01/06 $ $ 7,227,500 $ 7,227,500
-----------------------------------------
Total Software & Services $ $ 7,227,500 $ 7,227,500
-----------------------------------------
Technology Hardware & Equipment 1.75%
Communications Equipment 0.25%
2,320,000 2,320,000 Corning Inc., 5.9%, 3/15/14 $ 2,169,200 $ $ 2,169,200
-----------------------------------------
Computer Hardware 0.84%
5,000,000 5,000,000 IBM Corp., 5.375%, 02/01/09 $ $ 5,231,250 $ 5,231,250
2,000,000 2,000,000 NCR Corp., 7.125%, 6/15/09 2,187,632 2,187,632
-----------------------------------------
$ 2,187,632 $ 5,231,250 $ 7,418,882
-----------------------------------------
Electronic Manufacturing Services 0.35%
3,000,000 3,000,000 Jabil Circuit, Inc., 5.875%, 7/15/10 $ 3,098,988 $ $ 3,098,988
-----------------------------------------
Technology Distributors 0.31%
2,600,000 2,600,000 Arrow Electronic Inc., 6.875%, 7/1/13 $ 2,715,859 $ $ 2,715,859
-----------------------------------------
Total Technology Hardware & Equipment $ 10,171,679 $ 5,231,250 $ 15,402,929
-----------------------------------------
|
Telecommunication Services 1.70%
Integrated Telecom Services 1.43%
3,500,000 3,500,000 BellSouth Telecommunications, Inc., 6.50%,
06/15/05 $ $ 3,631,250 $ 3,631,250
1,500,000 1,500,000 GTE California, Inc., 6.70%, 09/01/09 1,627,500 1,627,500
1,000,000 1,000,000 GTE California, Inc., 7.65%, 03/15/07 1,100,154 1,100,154
2,600,000 2,600,000 Intelsat Ltd. 6.5%, 11/1/13 2,296,923 2,296,923
2,000,000 2,000,000 Southwestern Bell Telephone, 6.625%, 04/01/05 2,060,000 2,060,000
2,000,000 2,000,000 Telecom Italia S.p.A., 5.25%, 11/15/13 (144A) 1,935,692 1,935,692
-----------------------------------------
$ 4,232,615 $ 8,418,904 $ 12,651,519
-----------------------------------------
Wireless Telecom Services 0.26%
2,000,000 2,000,000 AT&T Wireless, 8.125%, 5/1/12 $ 2,312,302 $ $ 2,312,302
-----------------------------------------
Total Telecommunication Services $ 6,544,917 $ 8,418,904 $ 14,963,821
-----------------------------------------
Utilities 2.39%
Electric Utilities 1.86%
2,000,000 2,000,000 Alabama Power Co., 7.125%, 08/15/04 $ $ 2,012,500 $ 2,012,500
1,700,000 1,700,000 Alabama Power Co., 7.125%, 10/01/07 1,871,931 1,871,931
3,100,000 3,100,000 Baltimore Gas & Electric, 7.50%, 01/15/07 3,389,044 3,389,044
1,871,500 1,871,500 FLP Energy American Wind, 6.639%, 6/20/23
(144A) 1,910,876 1,910,876
614,900 614,900 FPL Energy Wind Funding, 6.876%, 6/27/17
(144A) 602,602 602,602
3,000,000 3,000,000 Georgia Power Co., 4.00%, 01/15/11 2,868,657 2,868,657
3,500,000 3,500,000 Wisconsin Electric Power, 6.625%, 11/15/06 3,753,750 3,753,750
-----------------------------------------
$ 2,513,478 $ 13,895,882 $ 16,409,360
-----------------------------------------
Multi-Utilities & Unregulated Power 0.53%
3,045,000 3,045,000 Illinova Corp., 7.5%, 6/15/09 $ 3,326,663 $ $ 3,326,663
750,000 750,000 Reliant Energy, Inc., 9.5%, 7/15/13 808,125 808,125
500,000 500,000 Reliant Resources Inc., 9.25%, 7/15/10 533,750 533,750
-----------------------------------------
$ 4,668,538 $ $ 4,668,538
-----------------------------------------
Total Utilities $ 7,182,016 $ 13,895,882 $ 21,077,898
-----------------------------------------
TOTAL CORPORATE BONDS $121,858,578 $308,670,064 $430,528,642
-----------------------------------------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS 45.70%
5,000,000 5,000,000 Federal Home Loan Bank, 2.38% 08/15/06 $ $ 4,932,605 $ 4,932,605
3,237,876 3,237,876 Federal Home Loan Mortgage Corp., 5.0%
11/01/18 3,248,982 3,248,982
2,365,426 12,600,333 14,965,759 Federal Home Loan Mortgage Corp., 5.5%,
9/01/17 to 12/1/18 2,431,432 12,911,310 15,342,742
20,658,502 7,761,569 28,420,071 Federal Home Loan Mortgage Corp., 6.0%,
1/1/33 to 5/1/34 21,131,611 7,943,422 29,075,033
10,000,000 10,000,000 Federal Home Loan Mortgage Corp., 6.25%
03/05/12 10,487,500 10,487,500
3,708,459 3,708,459 Federal Home Loan Mortgage Corp., 6.5%,
7/1/32 to 11/1/33 3,882,759 3,882,759
18,000,000 18,000,000 Federal Home Loan Mortgage Corp., 6.88%
01/15/05 18,496,062 18,496,062
34,416 34,416 Federal Home Loan Mortgage Corp., 7.0%,
12/1/30 to 6/1/31 36,403 36,403
8,786 8,786 Federal Home Loan Mortgage Corp., 7.5%,
7/1/30 9,466 9,466
8,240 8,240 Federal Home Loan Mortgage Corp., 10.5%,
4/1/19 9,249 9,249
43,729 43,729 Federal Home Loan Mortgage Corp., REMIC
1145G, 8.0%, 9/15/06 43,896 43,896
10,000,000 10,000,000 Federal National Mortgage Association, 2.63%,
01/19/07 9,808,840 9,808,840
5,000,000 5,000,000 Federal National Mortgage Association, 3.52%,
01/28/08 4,966,935 4,966,935
1,823,158 19,112,806 20,935,964 Federal National Mortgage Association, 5.5%,
1/1/17 to 12/1/18 1,869,240 19,539,457 21,408,697
14,583,745 12,893,692 27,477,437 Federal National Mortgage Association, 6.0%,
6/1/16 to 4/1/34 14,924,614 13,183,800 28,108,414
2,851,107 2,851,107 Federal National Mortgage Association, 6.5%,
4/1/31 to 10/1/32 2,972,148 2,972,148
1,480,701 1,480,701 Federal National Mortgage Association, 7.0%,
7/1/22 to 1/1/32 1,566,242 1,566,242
5,000,000 5,000,000 Federal National Mortgage Association, 7.13%,
03/15/07 5,480,255 5,480,255
26,013 26,013 Federal National Mortgage Association, 7.5%,
8/1/20 to 4/1/30 27,905 27,905
893 893 Federal National Mortgage Association, 10.0%,
7/1/19 937 937
53,777 53,777 Federal National Mortgage Association, 11.0%,
6/1/19 60,830 60,830
31,635 31,635 Federal National Mortgage Association, REMIC
Series 1989 - 19A, 10.3%, 4/25/19 34,792 34,792
7,751 7,751 Federal National Mortgage Association, REMIC
Series 1989 - 19B, 10.3%, 4/25/19 9,483 9,483
172,223 172,223 Federal National Mortgage Association, REMIC
Series 1995 - 23D, 7.0%, 10/25/07 179,579 179,579
5,377,670 5,377,670 Government National Mortgage Association,
4.5%, 8/15/33 to 10/15/33 5,060,748 5,060,748
1,142,702 1,142,702 Government National Mortgage Association,
5.0%, 9/15/33 1,110,305 1,110,305
2,483,930 2,483,930 Government National Mortgage Association,
5.5%, 4/20/34 2,481,861 2,481,861
22,767,186 4,643,562 27,410,748 Government National Mortgage Association,
6.0%, 5/15/17 to 10/15/33 23,343,999 4,768,003 28,112,002
7,062,442 25,605,640 32,668,082 Government National Mortgage Association,
6.5%, 8/15/11 to 10/15/33 7,390,722 26,800,769 34,191,491
|
2,265,539 3,936,175 6,201,714 Government National Mortgage Association,
7.0%, 9/15/11 to 5/15/32 2,410,339 4,185,269 6,595,608
1,685,940 142,825 1,828,765 Government National Mortgage Association,
7.5%, 8/15/11 to 12/15/31 1,817,734 152,956 1,970,690
25,858 25,858 Government National Mortgage Association,
7.75%, 2/15/30 28,167 28,167
87,390 87,390 Government National Mortgage Association,
8.00%, 05/15/10 92,579 92,579
7,093 7,093 Government National Mortgage Association,
9.5%, 5/15/20 8,016 8,016
72,063 72,063 Government National Mortgage Association,
10.0%, 1/15/06 to 7/15/20 79,700 79,700
802,539 802,539 Government National Mortgage Association I,
6.0%, 2/15/29 823,623 823,623
4,295,540 4,295,540 Government National Mortgage Association I,
6.5% 07/15/32 4,495,540 4,495,540
96,254 96,254 Government National Mortgage Association I,
7.0%, 12/15/30 102,371 102,371
3,440,514 3,440,514 Government National Mortgage Association II,
5.5%, 2/20/34 to 3/20/34 3,437,648 3,437,648
12,566,930 12,566,930 Government National Mortgage Association II,
6.0%, 11/20/33 12,884,069 12,884,069
42,894 410,397 453,291 Government National Mortgage Association II,
6.5%, 2/20/29 to 4/20/29 44,796 428,733 473,529
572,849 1,014,703 1,587,552 Government National Mortgage Association II,
7.0%, 11/20/28 to 12/20/30 608,000 1,079,066 1,687,066
64,900,000 64,900,000 U.S. Treasury Bonds, 6.25%, 08/15/23 71,886,939 71,886,939
19,000,000 19,000,000 U.S. Treasury Bonds, 7.50%, 11/15/16 23,428,634 23,428,634
1,000,000 1,000,000 U.S. Treasury Bonds, 8.0%, 11/15/21 1,310,703 1,310,703
11,000,000 11,000,000 U.S. Treasury Inflation Index, 3.875%,
04/15/29 16,044,890 16,044,890
5,000,000 5,000,000 U.S. Treasury Notes, 1.625%, 04/30/05 4,987,505 4,987,505
20,000,000 20,000,000 U.S. Treasury Notes, 3.00%, 02/15/09 19,375,000 19,375,000
2,310,000 2,310,000 U.S. Treasury Notes, 5.375%, 2/15/31 2,329,762 2,329,762
-----------------------------------------
TOTAL U.S. GOVERNMENT AND AGENCY OBLIGATIONS $114,463,149 $288,725,050 $403,188,199
-----------------------------------------
FOREIGN GOVERNMENT BOND 0.35%
3,000,000 3,000,000 British Columbia, 4.625%, 10/03/06 $ $ 3,092,091 $ 3,092,091
-----------------------------------------
TOTAL FOREIGN GOVERNMENT BOND $ $ 3,092,091 $ 3,092,091
-----------------------------------------
MUNICIPAL BONDS 0.17%
Government 0.17%
800,000 800,000 Atlanta Downtown Development Lease Revenue
Bond, 6.88%, 2/1/21 $ $ 906,000 $ 906,000
555,000 555,000 Tobacco Settlement Authority Iowa, 6.79%,
6/1/10 551,981 551,981
-----------------------------------------
TOTAL MUNICIPAL BONDS $ 551,981 $ 906,000 $ 1,457,981
-----------------------------------------
AFFILIATED SECURITIES 0.26%
2,289,102 2,289,102 AmSouth Prime Money Market Fund $ $ 2,289,102 $ 2,289,102
4,915 4,915 AmSouth Treasury Reserve Money Market Fund 4,915 4,915
-----------------------------------------
TOTAL AFFILIATED SECURITIES $ $ 2,294,017 $ 2,294,017
-----------------------------------------
TEMPORARY CASH INVESTMENTS 1.92%
Repurchase Agreement 1.19%
10,500,000 10,500,000 UBS Warburg, 1.25%, dated 6/30/04, repurchase
price of $10,500,000 plus accrued interest
on 7/1/04, collaterized by $10,657,000
U.S. Treasury Note 2.125%, 10/31/04 $ 10,500,000 $ $ 10,500,000
-----------------------------------------
Shares Shares Shares
Securities Lending Collateral 0.73%
6,457,325 6,457,325 Securities Lending Investment Fund, 1.29% $ 6,457,325 $ $ 6,457,325
-----------------------------------------
TOTAL TEMPORARY CASH INVESTMENTS $ 16,957,325 $ $ 16,957,325
-----------------------------------------
TOTAL INVESTMENT IN SECURITIES 99.32% $262,268,679 $613,949,383 $876,218,062
-----------------------------------------
OTHER ASSETS AND LIABILITIES 0.68% $ (2,565,718) $ 8,567,563 $ 6,001,845
-----------------------------------------
TOTAL NET ASSETS 100.00% $259,702,961 $622,516,946 $882,219,907
=========================================
Total Investments at Cost $259,425,607 $594,751,009 $854,176,616
=========================================
|
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration.
(a) No adjustments are shown to the unaudited pro forma combined schedule of
investments due to the fact that upon consumation of the merger no
securities would need to be sold in order for Pioneer Bond Fund to comply
with its prospectus restrictions. The foregoing sentence shall not
restrict in any way the ability of the investment adviser of the funds
from buying or selling securities in the normal course of such fund's
business and operations.
Pioneer Bond Fund
Pro Forma Statement of Assets and Liabilities
June 30, 2004
(Unaudited) (Amounts in Thousands, except for per share data)
AmSouth
Pioneer High Quality Pro Forma Pro Forma
Bond Fund Bond Fund Adjustments Combined
--------- --------- ----------- --------
ASSETS:
Investment in securities (including securities loaned of $6,161 and
$0, respectively) (cost $259,426 and $594,751, respectively) $262,269 $613,949 $ $876,218
Cash 51 - 51
Receivables -
Investment securities sold 1,895 - 1,895
Fund shares sold 173 32 205
Interest 2,718 8,856 11,574
Other 1 86 87
-------- -------- --------
Total assets $267,107 $622,923 $ $890,030
-------- -------- --------
LIABILITIES:
Payables -
Investment securities purchased $ 51 $ - $ $ 51
Fund shares repurchased 253 32 285
Dividends 230 - 230
Upon return of securities loaned 6,457 - 6,457
Due to affiliates 335 259 594
Accrued expenses 78 115 193
-------- -------- --------
Total liabilities $ 7,404 $ 406 $ $ 7,810
-------- -------- --------
NET ASSETS:
Paid-in capital $262,627 $603,175 $ $865,802
Accumulated net investment income 652 (3,432) (2,780)
Accumulated net realized loss on investments (6,419) 3,576 (2,843)
Net unrealized gain on investments 2,843 19,198 22,041
-------- -------- --------
Total net assets $259,703 $622,517 $ $882,220
======== ======== ========
OUTSTANDING SHARES:
(No par value, unlimited number of shares authorized)
Class A 17,476 3,880 786 (a) 22,142
======== ======== ========
Class I 51,814 (51,814)(a)
======== ======== ========
Class B 6,319 681 139 (a) 7,139
======== ======== ========
Class C 3,023 3,023
======== ======== ========
Class R 37 37
======== ======== ========
Class Y 1,493 62,722 (a) 64,215
======== ======== ========
NET ASSET VALUE PER SHARE:
Class A $ 9.18 $ 11.04 $ $ 9.18
======== ======== ========
Class I 11.04
======== ======== ========
Class B $ 9.14 $ 11.01 $ $ 9.14
======== ======== ========
Class C $ 9.11 $ $ $ 9.11
======== ======== ========
Class R $ 9.28 $ $ $ 9.28
======== ======== ========
Class Y $ 9.12 $ $ $ 9.12
======== ======== ========
MAXIMUM OFFERING PRICE:
Class A $ 9.61 $ $ $ 9.61
======== ======== ========
Class C $ 9.20 $ $ $ 9.20
======== ======== ========
|
(a) Class A, Class B, and Class I shares of AmSouth High Quality Bond Fund are exchanged for Class A, Class B, and Class Y shares of Pioneer Bond Fund.
See accompanying notes to pro forma financial statements.
Pioneer Bond Fund
Pro Forma Statement of Operations
For the Year Ended June 30, 2004
(Unaudited) (Amounts in Thousands)
AmSouth
Pioneer High Quality Pro Forma Pro Forma
Bond Fund Bond Adjustments Combined
--------- ---- ----------- --------
INVESTMENT INCOME:
Dividends $ - $ - $ $ -
Interest 15,120 30,507 45,627
Income from securities loaned, net 9 - 9
-------- ------- --------
Total investment income $ 15,129 $30,507 $ $ 45,636
-------- ------- --------
EXPENSES:
Management fees $ 1,362 $ 4,209 $ (985)(c) $ 4,586
Transfer agent fees and expenses - 196 (196)(c) -
Class I
Class A 503 - 139 (c) 642
Class B 254 - 36 (c) 290
Class C 111 - 111
Class R - - -
Class Y - - 118 (c) 118
Distribution fees -
Class I 89 (89)(c)
Class A 420 116 536
Class B 655 888 (801)(c) 742
Class C 289 - 289
Class R 1 - 1
Class Y - -
Administrative reimbursements 51 1,449 (1,301)(c) 199
Custodian fees 24 178 (115)(c) 87
Registration fees 100 15 - 115
Printing fees - 76 - 76
Professional fees 53 104 (104)(a) 53
Fees and expenses of nonaffiliated trustees 1 27 (27)(a) 1
Miscellaneous 10 56 66
-------- ------- ------- --------
Total expenses $ 3,834 $ 7,403 $(3,325) $ 7,912
Less management fees waived and expenses
reimbursed by PIM - (1,827) 1,784 (b) (43)
Less fees paid indirectly (6) - (6)
-------- ------- ------- --------
Net expenses $ 3,828 $ 5,576 $(1,541) $ 7,863
-------- ------- ------- --------
Net investment income $ 11,301 $24,931 $ 1,541 $ 37,773
-------- ------- ------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments $ 10,312 $ 4,897 $ 15,209
Change in net unrealized gain on investments (15,238) - (15,238)
-------- ------- --------
Net loss on investments $ (4,926) $ 4,897 $ (29)
-------- ------- ------- --------
Net decrease in net assets resulting from operations $ 6,375 $29,828 $ 1,541 $ 37,744
======== ======= ======= ========
|
(a) Reflects reduction in expenses due to elimination of duplicate services.
(b) Expense limitation conformed to Pioneer Bond Fund's management contract.
(c) Reflects change in fee structure to conform to Pioneer Bond Fund's
management, tranfer agent, custody and distribution plan agreements.
See accompanying notes to pro forma financial statements.
Pioneer Bond Fund
PRO FORMA NOTES TO COMBINING FINANCIAL STATEMENTS
06/30/04
(Unaudited)
1. Description of the Fund
Pioneer Bond Fund (the Fund) is a Delaware statutory trust registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The investment objective of the Fund is to seek current income consistent with preservation of capital.
The Trustees have authorized the issuance of five classes of shares of the Fund. The Fund offers five classes of shares - Class A, Class B, Class C, Class R, and Class Y shares. Class R shares were first publicly offered on April 1, 2003. Each class of shares represents an interest in the same portfolio of investments of the Fund and has equal rights to voting, redemptions, dividends and liquidation, except that the level of transfer agent and distribution fees may differ among classes. Class A, Class B, Class C, and Class R shareowners have exclusive voting rights with respect to the distribution plan for each class. There is no distribution plan for Class Y shares.
2. Basis of Combination
The accompanying pro forma combining financial statements, and related notes, are presented to show the effect of the proposed acquisition (the "acquisition") of AmSouth High Quality Bond Fund by the Fund, as if such acquisition had taken place as of July 1, 2003.
Under the terms of an Agreement and Plan of Reorganization (the "Reorganization") between these two Funds, the combination of the Fund and AmSouth High Quality Bond Fund will be treated as a tax-free business combination and accordingly will be accounted for by a method of accounting for tax-free mergers of investment companies. The acquisition will be accomplished by an acquisition of the net assets of AmSouth High Quality Bond Fund in exchange for shares of the Fund at their net asset values. The accompanying schedules of investments, statements of assets and liabilities and the related statements of operations of the Fund and AmSouth High Quality Bond Fund have been combined as of and for the most recent fiscal year ended June 30, 2004. Following the acquisition, the Fund will be the accounting survivor. All related acquisition costs will be borne by the Advisors.
These pro forma financial statements and related notes should be read in conjunction with the financial statements of the Fund and AmSouth High Quality Bond Fund included in their annual reports to shareowners dated June 30, 2004 and July 31, 2004, respectively. Adjustments have been made to expenses for Pioneer affiliate contractual rates and duplicate services that would not have been incurred if the merger took place on July 1, 2003.
3. Security Valuation
Security transactions are recorded as of trade date. Securities are valued at prices supplied by independent pricing services, which consider such factors as Treasury spreads, yields, maturities and ratings. Valuations may be supplemented by dealers and other sources, as required. Securities for which there are no other readily available valuation methods are valued at their fair values as determined by, or under the direction of the Board of Trustees. At June 30, 2004 there were no securities fair valued. Principal amounts of mortgage-backed securities are adjusted for monthly paydowns. Temporary cash investments are valued at amortized cost.
All discounts/premiums on debt securities are accreted/amortized for financial reporting purposes over the life of the respective securities, and are included in interest income. Market discount and premium are accreted or amortized daily. Premiums and discounts related to certain mortgage-backed securities are amortized or accreted in proportion to the underlying monthly paydowns. Interest income is recorded on the accrual basis.
4. Capital Shares
The pro forma net asset value per share assumes the issuance of shares of the Fund that would have been issued at June 30, 2004, in connection with the proposed acquisition. The number of shares assumed to be issued is equal to the net asset value of shares of AmSouth High Quality Bond Fund, as of June 30, 2004, divided by the net asset value per share of the Fund's shares as of June 30, 2004. The pro forma number of shares outstanding, by class, for the combined Fund consists of the following at June 30, 2004:
---------------------------------------------------------------------------
Total
Shares of Additional Shares Outstanding
The Fund Assumed Issued Shares
Class of Shares Pre-Combination In Reorganization Post-Combination
---------------------------------------------------------------------------
Class A 17,476 4,666 22,142
---------------------------------------------------------------------------
Class B 6,319 820 7,139
---------------------------------------------------------------------------
Class C 3,023 3,023
---------------------------------------------------------------------------
Class R 37 37
---------------------------------------------------------------------------
Class Y 1,493 62,722 64,215
---------------------------------------------------------------------------
|
5. Federal Income Taxes
Each Fund has elected to be taxed as a "regulated investment company" under the Internal Revenue Code. After the acquisition, it will continue to be the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income and net realized capital gains, if any, to its shareowners. Therefore, no federal income tax provision is required.
The identified cost of investments for these funds is substantially the same for both financial and federal income tax purposes. The cost of investments will remain unchanged for the combined Fund.
PIONEER BOND FUND
PRO FORMA
Schedule of Investments (a)
December 31, 2004
(Unaudited)
Pioneer AmSouth Pioneer AmSouth
Bond High Quality Pro Forma % of Bond High Quality Pro Forma
Fund Bond Fund Combined Pro Forma Fund Bond Fund Combined
Principal Principal Principal Combined Market Market Market
Amount Amount Amount Net Assets Value Value Value
------ ------ ------ ---------- ----- ----- -----
ASSET BACKED SECURITIES 1.43%
Diversified Financials 0.94%
Consumer Finance 0.00%
31,958 31,958 Americredit Automobile Receivables Trust,
Floating Rate Note, 12/12/07 $ 31,978 $ $ 31,978
-----------------------------------------
Diversified Financial Services 0.93%
1,864,000 1,864,000 PF Export Receivable Master Trust, 6.436%,
6/1/15 (144A) $ 1,852,648 $ $ 1,852,648
1,387,018 1,387,018 Power Receivables Finance, 6.29%, 1/1/12
(144A) 1,459,767 1,459,767
5,000,000 5,000,000 Sears Credit Account Master Trust, 6.75%,
09/16/09 5,124,800 5,124,800
-----------------------------------------
$ 3,312,415 $ 5,124,800 $ 8,437,215
-----------------------------------------
Specialized Finance 0.01%
90,000 90,000 MBNA Credit Card Master Note, Floating Rate
Note, 12/15/08 $ 90,123 $ $ 90,123
-----------------------------------------
Total Diversified Financials $ 3,434,516 $ 5,124,800 $ 8,559,316
-----------------------------------------
Utilities 0.49%
Electric Utilities 0.49%
1,700,000 1,700,000 Alabama Power Co., 7.125%, 10/01/07 $ $ 1,851,081 $ 1,851,081
1,700,000 1,700,000 Empresa Electric Guacolda, 8.625%, 4/30/13
(144A) 1,941,407 1,941,407
662,200 662,200 FPL Energy Wind Funding, 6.876%, 6/27/17
(144A) 682,894 682,894
-----------------------------------------
Total Utilities $ 2,624,301 $ 1,851,081 $ 4,475,382
-----------------------------------------
TOTAL ASSET BACKED SECURITIES $ 6,058,817 $ 6,975,881 $ 13,034,698
-----------------------------------------
COLLATERIZED MORTGAGE OBLIGATIONS 0.85%
Diversified Financials 0.30%
Consumer Finance 0.00%
7,110 7,110 Asset Securitization Corp., Floating Rate
Note, 1/13/30 $ 7,132 $ $ 7,132
-----------------------------------------
Diversified Financial Services 0.30%
2,175,000 2,175,000 Tower 2004-1A E, 5.395%, 1/15/34 $ 2,170,959 $ $ 2,170,959
525,000 525,000 Tower 2004-2A F, 6.376%, 12/15/14 522,375 522,375
-----------------------------------------
$ 2,693,334 $ $ 2,693,334
-----------------------------------------
Total Diversified Financials $ 2,700,466 $ $ 2,700,466
-----------------------------------------
Insurance 0.55%
Life & Health Insurance 0.55%
5,000,000 5,000,000 Asif Global Financing, 3.85%, 11/26/07 $ $ 5,022,500 $ 5,022,500
-----------------------------------------
Total Insurance $ $ 5,022,500 $ 5,022,500
-----------------------------------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS $ 2,700,466 $ 5,022,500 $ 7,722,966
-----------------------------------------
CORPORATE BONDS 42.32%
Energy 1.30%
Integrated Oil & Gas 0.01%
45,000 45,000 Petro-Canada, 4.0%, 7/15/13 $ 42,153 $ $ 42,153
25,000 25,000 USX Corp., 6.85%, 3/1/08 27,200 27,200
-----------------------------------------
$ 69,353 $ $ 69,353
-----------------------------------------
|
Oil & Gas Exploration & Production 1.07%
1,000,000 1,000,000 Conoco, Inc., 6.35%, 04/15/09 $ $ 1,095,336 $ 1,095,336
2,000,000 2,000,000 ConocoPhillips, 6.375%, 03/30/09 2,187,500 2,187,500
2,000,000 2,000,000 Gazprom International SA., 7.201%, 2/1/20
(144A) 2,115,000 2,115,000
75,000 75,000 Pemex Project Funding Master, 9.125%,
10/13/10 89,925 89,925
4,000,000 4,000,000 Texaco Capital, Inc., 7.09%, 02/01/07 4,300,000 4,300,000
-----------------------------------------
$ 2,204,925 $ 7,582,836 $ 9,787,761
-----------------------------------------
Oil & Gas Refining Marketing &
Transportation 0.22%
65,000 65,000 Kinder Morgan Energy Partners, 6.75%,
3/15/11 $ 72,568 $ $ 72,568
1,750,000 1,750,000 Magellan Midstream Partners, L.P., 6.45%,
6/1/14 1,892,462 1,892,462
-----------------------------------------
$ 1,965,030 $ $ 1,965,030
-----------------------------------------
Total Energy $ 4,239,308 $ 7,582,836 $ 11,822,144
-----------------------------------------
Materials 3.05%
Aluminum 0.51%
4,000,000 4,000,000 Alcoa, Inc., 7.375%, 08/01/10 $ $ 4,633,140 $ 4,633,140
-----------------------------------------
Commodity Chemicals 0.32%
1,100,000 1,100,000 Methanex Corp., 8.75%, 8/15/12 $ 1,284,250 $ $ 1,284,250
1,500,000 1,500,000 Nova Chemicals, Ltd., 6.5%, 1/15/12 1,590,000 1,590,000
-----------------------------------------
$ 2,874,250 $ $ 2,874,250
-----------------------------------------
Construction Materials 0.23%
2,000,000 2,000,000 Vulcan Materials Co., 6.00%, 04/01/09 $ $ 2,135,628 $ 2,135,628
-----------------------------------------
Diversified Metals & Mining 0.62%
2,575,000 2,575,000 Kennametal, Inc., 7.2%, 6/15/12 $ 2,861,430 $ $ 2,861,430
2,500,000 2,500,000 PPG Industries, Inc., 7.05%, 08/15/09 2,784,375 2,784,375
-----------------------------------------
$ 2,861,430 $ 2,784,375 $ 5,645,805
-----------------------------------------
Fertilizers & Agricultural Chemicals 0.00%
45,000 45,000 Potash Corp. Saskatchewan, 4.875%, 3/1/13 $ 45,232 $ $ 45,232
-----------------------------------------
Forest Products 0.00%
17,000 17,000 Weyerhaeuser Co., 5.5%, 3/15/05 $ 17,078 $ $ 17,078
-----------------------------------------
Metal & Glass Containers 0.24%
2,000,000 2,000,000 Greif Brothers Corp., 8.875%, 8/1/12 $ 2,225,000 $ $ 2,225,000
-----------------------------------------
Paper Packaging 0.13%
1,125,000 1,125,000 Abitibi-Consolidated, Inc., 6.95%, 12/15/06 $ 1,167,188 $ $ 1,167,188
-----------------------------------------
Paper Products 0.71%
1,300,000 1,300,000 Bowater Canada Finance, 7.95%, 11/15/11 $ 1,400,845 $ $ 1,400,845
5,000,000 5,000,000 International Paper Co., 5.30%, 04/01/15 5,068,750 5,068,750
-----------------------------------------
$ 1,400,845 $ 5,068,750 $ 6,469,595
-----------------------------------------
Specialty Chemicals 0.12%
600,000 600,000 Ferro Corp., 7.625%, 5/1/13 $ 620,585 $ $ 620,585
500,000 500,000 Ferro Corp., 7.125%, 4/1/28 495,720 495,720
-----------------------------------------
$ 1,116,305 $ $ 1,116,305
-----------------------------------------
Steel 0.17%
1,400,000 1,400,000 Ispat Inland ULC, Floating Rate Note, 4/1/10 $ 1,522,500 $ $ 1,522,500
-----------------------------------------
Total Materials $ 13,229,828 $ 14,621,893 $ 27,851,721
-----------------------------------------
Capital Goods 4.62%
Aerospace & Defense 0.90%
40,000 40,000 Boeing Co., 5.125%, 2/15/13 $ 41,379 $ $ 41,379
120,000 120,000 Honeywell International, 7.5%, 3/1/10 138,641 138,641
2,145,000 2,145,000 McDonnell Douglas Corp., 6.875%, 11/01/06 2,271,019 2,271,019
5,000,000 5,000,000 United Technologies Corp., 7.125%, 11/15/10 5,750,845 5,750,845
-----------------------------------------
$ 180,020 $ 8,021,864 $ 8,201,884
-----------------------------------------
|
Building Products 0.07%
638,000 638,000 Smith Enron, 5.97%, 12/15/06 $ $ 640,466 $ 640,466
-----------------------------------------
Construction & Farm Machinery & Heavy Trucks 0.23%
2,100,000 2,100,000 Caterpillar Financial Services Corp., 2.50%,
10/03/06 $ $ 2,069,540 $ 2,069,540
-----------------------------------------
Construction & Engineering 0.12%
970,000 970,000 Shaw Group, Inc., 10.75%, 3/15/10 (b) $ 1,069,425 $ $ 1,069,425
-----------------------------------------
Electrical Component & Equipment 2.24%
1,500,000 1,500,000 Emerson Electric, 6.30%, 11/01/05 $ $ 1,535,625 $ 1,535,625
12,000,000 12,000,000 General Electric Co., 5.00%, 02/01/13 12,331,932 12,331,932
3,456,000 3,456,000 Rockwell International Corp., 6.625%,
06/01/05 3,503,520 3,503,520
2,750,000 2,750,000 Thomas & Betts Corp., 7.25%, 6/1/13 3,016,525 3,016,525
-----------------------------------------
$ 3,016,525 $ 17,371,077 $ 20,387,602
-----------------------------------------
Industrial Machinery 1.07%
2,300,000 2,300,000 Caterpillar, Inc., 3.1%, 05/15/07 $ $ 2,281,897 $ 2,281,897
1,000,000 1,000,000 Caterpillar, Inc., 6.55%, 05/01/11 1,123,750 1,123,750
2,000,000 2,000,000 Honeywell, Inc., 7.00%, 03/15/07 2,145,378 2,145,378
1,950,000 1,950,000 JLG Industries, Inc., 8.375%, 6/15/12 (b) 2,086,500 2,086,500
2,000,000 2,000,000 Sun Sage BV, 8.25%, 3/26/09 (144A) 2,100,000 2,100,000
-----------------------------------------
$ 4,186,500 $ 5,551,025 $ 9,737,525
-----------------------------------------
Total Capital Goods $ 8,452,470 $ 33,653,971 $ 42,106,441
-----------------------------------------
Commercial Services & Supplies 0.05%
Diversified Commercial Services 0.05%
500,000 500,000 Deluxe Corp., 3.5%, 10/1/07 (144A) $ 493,561 $ $ 493,561
-----------------------------------------
Total Commercial Services & Supplies $ 493,561 $ $ 493,561
-----------------------------------------
Transportation 0.19%
Airlines 0.19%
1,548,465 1,548,465 Southwest Airlines Co., 7.67%, 1/2/14 $ 1,722,233 $ $ 1,722,233
-----------------------------------------
Total Transportation $ 1,722,233 $ $ 1,722,233
-----------------------------------------
Automobiles & Components 0.67%
Auto Parts & Equipment 0.02%
150,000 150,000 Lear Corp., 7.96%, 5/15/05 (144A) $ 152,395 $ $ 152,395
-----------------------------------------
Automobile Manufacturers 0.65%
130,000 130,000 Ford Motor Co., 7.25%, 10/1/08 $ 139,451 $ $ 139,451
150,000 150,000 General Motors Acceptance Corp., 6.125%,
9/15/06 153,777 153,777
2,000,000 2,000,000 General Motors Acceptance Corp., 6.15%,
04/07/07 2,057,500 2,057,500
3,000,000 3,000,000 General Motors Acceptance Corp., 7.50%,
07/15/05 3,063,750 3,063,750
500,000 500,000 General Motors Capital Corp., 7.5%, 7/15/05 510,300 510,300
-----------------------------------------
$ 803,528 $ 5,121,250 $ 5,924,778
-----------------------------------------
Total Automobiles & Components $ 955,923 $ 5,121,250 $ 6,077,173
-----------------------------------------
Consumer Durables & Apparel 0.01%
Housewares & Specialties 0.01%
55,000 55,000 Newell Rubbermaid Inc., 4.625%, 12/15/09 $ 55,519 $ $ 55,519
-----------------------------------------
Total Consumer Durables & Apparel $ 55,519 $ $ 55,519
-----------------------------------------
Consumer Services 0.95%
Restaurants 0.95%
5,500,000 5,500,000 McDonald's Corp., 5.35%, 09/15/08 $ $ 5,802,500 $ 5,802,500
700,000 700,000 McDonald's Corp., 6.00%, 04/15/11 763,000 763,000
2,000,000 2,000,000 McDonald's Corp., 5.375%, 04/30/07 2,085,378 2,085,378
-----------------------------------------
Total Consumer Services $ $ 8,650,878 $ 8,650,878
-----------------------------------------
|
Media 0.64%
Broadcasting & Cable Television 0.32%
135,000 135,000 Comcast Corp., 5.3%, 1/15/14 $ 139,227 $ $ 139,227
2,500,000 2,500,000 Rogers Cable, Inc., 7.875%, 5/1/12 2,737,500 2,737,500
-----------------------------------------
$ 2,876,727 $ $ 2,876,727
-----------------------------------------
Movies & Entertainment 0.01%
45,000 45,000 Time Warner, Inc., 6.75%, 4/15/11 $ 50,619 $ $ 50,619
-----------------------------------------
Publishing 0.31%
2,800,000 2,800,000 New York Times Co., 4.625%, 06/25/07 $ $ 2,864,823 $ 2,864,823
-----------------------------------------
Total Media $ 2,927,346 $ 2,864,823 $ 5,792,169
-----------------------------------------
Retailing 1.20%
Apparel Retail 0.40%
3,500,000 3,500,000 Nike, Inc., 5.50%, 08/15/06 $ $ 3,623,484 $ 3,623,484
-----------------------------------------
Department Stores 0.12%
1,000,000 1,000,000 May Department Stores Co., 7.90%, 10/15/07 $ $ 1,103,233 $ 1,103,233
25,000 25,000 Nordstrom, Inc., 5.625%, 1/15/09 26,458 26,458
-----------------------------------------
$ 26,458 $ 1,103,233 $ 1,129,691
-----------------------------------------
General Merchandise Stores 0.42%
3,500,000 3,500,000 Target Corp., 5.875%, 03/01/12 $ $ 3,815,000 $ 3,815,000
-----------------------------------------
Specialty Stores 0.26%
1,825,000 1,825,000 Toys "R" Us, 7.875%, 4/15/13 (b) $ 1,811,313 $ $ 1,811,313
580,000 580,000 Toys "R" Us, 7.375%, 10/15/18 536,500 536,500
-----------------------------------------
$ 2,347,813 $ $ 2,347,813
-----------------------------------------
Total Retailing $ 2,374,271 $ 8,541,717 $ 10,915,988
-----------------------------------------
Food & Staples Retailing 0.91%
Food Distributors 0.28%
2,500,000 2,500,000 Sysco Corp., 4.75%, 07/30/05 $ $ 2,525,000 $ 2,525,000
-----------------------------------------
Hypermarkets & Supercenters 0.63%
1,000,000 1,000,000 Wal-Mart Stores, Inc., 8.62%, 1/1/10 $ 1,088,120 $ $ 1,088,120
4,500,000 4,500,000 Wal-Mart Stores, Inc., 5.45%, 08/01/06 4,656,254 4,656,254
-----------------------------------------
$ 1,088,120 $ 4,656,254 $ 5,744,374
-----------------------------------------
Total Food & Staples Retailing $ 1,088,120 $ 7,181,254 $ 8,269,374
-----------------------------------------
Food, Beverage & Tobacco 3.39%
Brewers 0.01%
55,000 55,000 Miller Brewing Co., 5.5%, 8/15/13 (144A) $ 57,489 $ $ 57,489
-----------------------------------------
Packaged Foods & Meats 2.16%
7,000,000 7,000,000 Hormel Foods Corp., 6.625%, 06/01/11 $ $ 7,840,000 $ 7,840,000
5,625,000 5,625,000 Sara Lee Corp., 6.15%, 06/19/08 6,067,181 6,067,181
5,000,000 5,000,000 Unilever Capital Corp., 7.125%, 11/01/10 5,758,075 5,758,075
55,000 55,000 Unilever Capital Corp., 7.125%, 11/01/10 63,262 63,262
-----------------------------------------
$ 63,262 $ 19,665,256 $ 19,728,518
-----------------------------------------
Soft Drinks 1.07%
5,500,000 5,500,000 Bottling Group LLC, 2.45%, 10/16/06 $ $ 5,418,259 $ 5,418,259
55,000 55,000 Bottling Group LLC, 5.0%, 11/15/13 56,704 56,704
4,000,000 4,000,000 Coca-Cola Co., 5.75%, 03/15/11 4,325,000 4,325,000
-----------------------------------------
$ 56,704 $ 9,743,259 $ 9,799,963
-----------------------------------------
|
Tobacco 0.15%
1,225,000 1,225,000 Altria Group, Inc., 7.0%, 11/4/13 $ 1,327,348 $ $ 1,327,348
-----------------------------------------
Total Food, Beverage & Tobacco $ 1,504,803 $ 29,408,515 $ 30,913,318
-----------------------------------------
Household & Personal Products 0.76%
Household Products 0.56%
500,000 500,000 Clorox Co., 6.125%, 02/01/11 $ $ 546,681 $ 546,681
4,400,000 4,400,000 Colgate-Palmolive Co., 5.34%, 03/27/06 4,515,500 4,515,500
-----------------------------------------
$ $ 5,062,181 $ 5,062,181
-----------------------------------------
Personal Products 0.20%
1,700,000 1,700,000 Kimberly-Clark Corp., 7.10%, 08/01/07 $ $ 1,855,125 $ 1,855,125
-----------------------------------------
Total Household & Personal Products $ $ 6,917,306 $ 6,917,306
-----------------------------------------
Health Care Equipment & Services 1.31%
Health Care Distributors 0.23%
2,066,000 2,066,000 Cardinal Health, Inc., 6.0%, 1/15/06 $ 2,109,667 $ $ 2,109,667
-----------------------------------------
Health Care Facilities 0.30%
2,735,000 2,735,000 HCA, Inc., 6.3%, 10/1/12 $ 2,773,851 $ $ 2,773,851
-----------------------------------------
Health Care Supplies 0.22%
1,874,000 1,874,000 Bausch & Lomb, 7.125%, 8/1/28 $ 1,996,743 $ $ 1,996,743
-----------------------------------------
Health Care Services 0.55%
5,000,000 5,000,000 UnitedHealth Group, Inc., 5.00%, 08/15/14 $ $ 5,039,605 $ 5,039,605
-----------------------------------------
Total Health Care Equipment & Services $ 6,880,261 $ 5,039,605 $ 11,919,866
-----------------------------------------
Pharmaceuticals & Biotechnology 0.40%
Pharmaceuticals 0.40%
1,000,000 1,000,000 GlaxoSmithKline Capital PLC, 2.375%,
04/16/07 $ $ 979,474 $ 979,474
2,600,000 2,600,000 Pharmacia Corp., 5.75%, 12/01/05 2,661,750 2,661,750
-----------------------------------------
Total Pharmaceuticals & Biotechnology $ $ 3,641,224 $ 3,641,224
-----------------------------------------
Banks 4.13%
Diversified Banks 0.02%
45,000 45,000 U.S. Bancorp, 3.125%, 3/15/08 $ 44,211 $ $ 44,211
145,000 145,000 International Bank for Reconstruction &
Development, 4.375%, 9/28/06 148,096 148,096
-----------------------------------------
$ 192,307 $ $ 192,307
-----------------------------------------
Regional Banks 4.11%
1,100,000 1,100,000 Bank of America Corp., 7.75%, 08/15/15 $ $ 1,322,750 $ 1,322,750
1,000,000 1,000,000 Bank One Texas NA, 6.25%, 02/15/08 1,066,834 1,066,834
3,157,000 3,157,000 Bank One Texas NA, 7.00%, 07/15/05 3,224,086 3,224,086
4,500,000 4,500,000 Branch Banking & Trust, 4.875%, 01/15/13 4,532,063 4,532,063
1,000,000 1,000,000 Fifth Third Bank, 2.70%, 01/30/07 985,287 985,287
4,000,000 4,000,000 Fifth Third Bank, 6.75%, 07/15/05 4,080,000 4,080,000
2,100,000 2,100,000 FleetBoston Financial Corp., 4.875%,
12/01/06 2,157,750 2,157,750
1,250,000 1,250,000 Hudson United Bank, 7.0%, 5/15/12 1,400,120 1,400,120
55,000 55,000 Keycorp, 2.75%, 2/27/07 53,988 53,988
5,500,000 5,500,000 SunTrust Banks, Inc., 6.375%, 04/01/11 6,101,810 6,101,810
3,159,000 3,159,000 SunTrust Banks, Inc., 7.375%, 07/01/06 3,341,979 3,341,979
2,000,000 2,000,000 U.S. Bank NA, 3.75%, 02/06/09 1,982,100 1,982,100
1,875,000 1,875,000 Wachovia Corp., 6.605%, 10/01/25 2,085,938 2,085,938
5,000,000 5,000,000 Wachovia Corp., 6.875%, 09/15/05 5,131,250 5,131,250
-----------------------------------------
$ 1,454,108 $ 36,011,846 $ 37,465,954
-----------------------------------------
Total Banks $ 1,646,415 $ 36,011,846 $ 37,658,261
-----------------------------------------
Diversified Financials 7.80%
Asset Management & Custody Banks 1.62%
2,000,000 2,000,000 Mellon Funding Corp., 6.40%, 05/14/11 $ $ 2,222,500 $ 2,222,500
6,000,000 6,000,000 Northern Trust Co., 7.10%, 08/01/09 6,719,022 6,719,022
|
5,000,000 5,000,000 State Street Corp., 7.65%, 06/15/10 5,877,285 5,877,285
-----------------------------------------
$ $ 14,818,807 $ 14,818,807
-----------------------------------------
Consumer Finance 3.35%
6,251,000 6,251,000 Boeing Capital Corp., 7.375%, 09/27/10 $ $ 7,215,479 $ 7,215,479
3,485,000 3,485,000 Ford Motor Credit Co., 6.25%, 12/08/05 3,570,985 3,570,985
5,000,000 5,000,000 HSBC Finance Corp., 6.50%, 01/24/06 5,170,155 5,170,155
6,000,000 6,000,000 John Deere Capital Corp., 7.00%, 03/15/12 6,930,000 6,930,000
90,000 90,000 National Rural Utilities, 7.25%, 3/1/12 103,878 103,878
2,340,000 2,340,000 SLM Corp., Floating Rate Note Note, 7/25/14 2,331,623 2,331,623
5,000,000 5,000,000 Toyota Motor Credit Corp., 5.65%, 01/15/07 5,218,750 5,218,750
-----------------------------------------
$ 2,435,501 $ 28,105,370 $ 30,540,871
-----------------------------------------
Investment Banking & Brokerage 1.20%
2,800,000 2,800,000 Bear Stearns Cos., Inc., 4.00%, 01/31/08 $ $ 2,822,865 $ 2,822,865
1,275,000 1,275,000 E*Trade Financial Corp., 8.0%, 6/15/11
(144A) 1,370,625 1,370,625
6,000,000 6,000,000 Lehman Brothers Holdings, Inc., 3.50%,
08/07/08 5,933,898 5,933,898
750,000 750,000 Refco Finance Holdings, 9.0%, 8/1/12 (144A) 821,250 821,250
-----------------------------------------
$ 2,191,875 $ 8,756,763 $ 10,948,638
-----------------------------------------
Other Diversified Financial Services 0.81%
1,550,000 1,550,000 Bombardier Capital, Inc., 7.09%, 3/30/07 $ 1,565,500 $ $ 1,565,500
2,250,000 2,250,000 Glencore Funding LLC, 6.0%, 4/15/14 (144A) 2,176,826 2,176,826
3,500,000 3,500,000 Morgan Stanley, 6.50%, 11/01/05 3,605,000 3,605,000
-----------------------------------------
$ 3,742,326 $ 3,605,000 $ 7,347,326
-----------------------------------------
Specialized Finance 0.82%
6,000,000 6,000,000 Prudential Funding LLC, 6.60%, 05/15/08 $ $ 6,495,000 $ 6,495,000
950,000 950,000 Tengizchevroil LLP, 6.124%, 11/15/14 (144A) 952,375 952,375
-----------------------------------------
$ 952,375 $ 6,495,000 $ 7,447,375
-----------------------------------------
Total Diversified Financials $ 9,322,077 $ 61,780,940 $ 71,103,017
-----------------------------------------
Insurance 4.57%
Life & Health Insurance 1.62%
85,000 85,000 Jackson National Life Global Funding,
Floating Rate Note, 3/11/05 (144A) $ 85,019 $ $ 85,019
5,000,000 5,000,000 John Hancock Financial Services, Inc.,
5.625%, 12/01/08 5,312,500 5,312,500
90,000 90,000 Lincoln National Corp., 5.25%, 6/15/07 93,218 93,218
1,000,000 1,000,000 MetLife, Inc., 6.125%, 12/01/11 1,088,750 1,088,750
2,000,000 2,000,000 Presidential Life Corp., 7.875%, 2/15/09 2,000,000 2,000,000
3,500,000 3,500,000 Protective Life Secured Trust, 4.00%,
10/07/09 3,475,798 3,475,798
2,850,000 2,850,000 Provident Companies Inc., 7.0%, 7/15/18 (b) 2,753,813 2,753,813
-----------------------------------------
$ 4,932,050 $ 9,877,048 $ 14,809,098
-----------------------------------------
Multi-Line Insurance 0.72%
1,700,000 1,700,000 Allmerica Financial Corp., 7.625%, 10/15/25 $ 1,731,809 $ $ 1,731,809
3,000,000 3,000,000 Berkshire Hathaway, Inc., 3.375%, 10/15/08 2,968,278 2,968,278
1,950,000 1,950,000 Loews Corp., 5.25%, 3/15/16 1,885,779 1,885,779
-----------------------------------------
$ 3,617,588 $ 2,968,278 $ 6,585,866
-----------------------------------------
Property & Casualty Insurance 1.93%
1,000,000 1,000,000 Allstate Financial Global Fund, 7.125%,
09/26/05 $ $ 1,028,422 $ 1,028,422
1,325,000 1,325,000 Arch Capital Group, Ltd., 7.35%, 5/1/34 1,412,667 1,412,667
1,000,000 1,000,000 Chubb Corp., 6.00%, 11/15/11 1,080,000 1,080,000
1,000,000 1,000,000 Chubb Corp., 6.15%, 08/15/05 1,017,500 1,017,500
2,010,000 2,010,000 Kingsway America, Inc., 7.5%, 2/1/14 2,083,918 2,083,918
1,400,000 1,400,000 Ohio Casualty Corp., 7.3%, 6/15/14 1,506,674 1,506,674
9,125,000 9,125,000 St. Paul Cos., Inc., 5.75%, 03/15/07 9,498,395 9,498,395
-----------------------------------------
$ 5,003,259 $ 12,624,317 $ 17,627,576
-----------------------------------------
Reinsurance 0.29%
2,400,000 2,400,000 Odyssey Re Holdings, 7.65%, 11/1/13 $ 2,647,104 $ $ 2,647,104
-----------------------------------------
Total Insurance $ 16,200,001 $ 25,469,643 $ 41,669,644
-----------------------------------------
|
Real Estate 0.88%
Real Estate Management & Development 0.26%
2,200,000 2,200,000 Forest City Enterprises, 7.625%, 6/1/15 $ 2,332,000 $ $ 2,332,000
-----------------------------------------
Real Estate Investment Trusts 0.62%
1,100,000 1,100,000 Colonial Reality LP, 6.15%, 4/15/13 $ 1,142,559 $ $ 1,142,559
890,000 890,000 Crescent Real Estate, 7.5%, 9/15/07 954,525 954,525
850,000 850,000 Health Care REIT, 6.0%, 11/15/13 879,723 879,723
935,000 935,000 Health Care REIT, Inc., 8.0%, 9/12/12 1,095,517 1,095,517
1,450,000 1,450,000 Hospitality Properties Trust, 6.75%, 2/15/13 1,601,081 1,601,081
-----------------------------------------
$ 5,673,405 $ $ 5,673,405
-----------------------------------------
Total Real Estate $ 8,005,405 $ $ 8,005,405
-----------------------------------------
Software & Services 0.78%
Data Processing & Outsourced Services 0.78%
7,000,000 7,000,000 First Data Corp., 4.70%, 11/01/06 $ $ 7,157,500 $ 7,157,500
-----------------------------------------
Total Software & Services $ $ 7,157,500 $ 7,157,500
-----------------------------------------
Technology Hardware & Equipment 1.09%
Communications Equipment 0.26%
2,395,000 2,395,000 Corning, Inc., 5.9%, 3/15/14 $ 2,400,312 $ $ 2,400,312
-----------------------------------------
Computer Hardware 0.82%
5,000,000 5,000,000 IBM Corp., 5.375%, 02/01/09 $ $ 5,293,750 $ 5,293,750
2,000,000 2,000,000 NCR Corp., 7.125%, 6/15/09 2,208,314 2,208,314
-----------------------------------------
$ 2,208,314 $ 5,293,750 $ 7,502,064
-----------------------------------------
Total Technology Hardware & Equipment $ 4,608,626 $ 5,293,750 $ 9,902,376
-----------------------------------------
Telecommunication Services 1.21%
Integrated Telecommunications Services 1.21%
300,000 300,000 AT&T Corp., 7.75%, 3/1/07 $ 324,750 $ $ 324,750
3,500,000 3,500,000 BellSouth Telecommunications, Inc., 6.50%,
06/15/05 3,556,875 3,556,875
1,500,000 1,500,000 GTE California, Inc., 6.70%, 09/01/09 1,636,875 1,636,875
1,000,000 1,000,000 GTE California, Inc., 7.65%, 03/15/07 1,080,069 1,080,069
2,600,000 2,600,000 Intelsat, Ltd., 6.5%, 11/1/13 2,366,000 2,366,000
2,000,000 2,000,000 Telecom Italia Capital, 5.25%, 11/15/13 2,021,470 2,021,470
40,000 40,000 Verizon Global Funding Corp., 7.375%, 9/1/12 47,070 47,070
-----------------------------------------
Total Telecommunication Services $ 4,759,290 $ 6,273,819 $ 11,033,109
-----------------------------------------
Utilities 2.44%
Electric Utilities 2.20%
3,100,000 3,100,000 Baltimore Gas & Electric, 7.50%, 01/15/07 $ $ 3,336,989 $ 3,336,989
5,000,000 5,000,000 Duke Energy Corp., 6.25%, 01/15/12 5,458,580 5,458,580
1,871,500 1,871,500 FLP Energy American Wind LLC, 6.639%,
6/20/23 (144A) 1,995,730 1,995,730
3,000,000 3,000,000 Georgia Power Co., 4.00%, 01/15/11 2,925,402 2,925,402
1,555,000 1,555,000 Kiowa Power Partners LLC, 5.737%, 3/30/21
(144A) 1,561,220 1,561,220
1,000,000 1,000,000 MSW Energy Holdings, 7.375%, 9/1/10 1,050,000 1,050,000
65,000 65,000 PSE&G Power, 6.95%, 6/1/12 73,245 73,245
3,500,000 3,500,000 Wisconsin Electric Power, 6.625%, 11/15/06 3,701,250 3,701,250
-----------------------------------------
$ 4,680,195 $ 15,422,221 $ 20,102,416
-----------------------------------------
Multi-Utilities & Unregulated Power 0.24%
100,000 100,000 Avista Corp., 7.75%, 1/1/07 $ 107,311 $ $ 107,311
25,000 25,000 Dominion Resources, 6.25%, 6/30/12 27,295 27,295
1,795,000 1,795,000 Illinova Corp., 7.5%, 6/15/09 2,024,527 2,024,527
-----------------------------------------
$ 2,159,133 $ $ 2,159,133
-----------------------------------------
Total Utilities $ 6,839,328 $ 15,422,221 $ 22,261,549
-----------------------------------------
TOTAL CORPORATE BONDS $ 95,304,785 $290,634,989 $385,939,774
-----------------------------------------
|
U.S. GOVERNMENT AGENCY OBLIGATIONS 50.68%
5,000,000 5,000,000 Federal Home Loan Bank, 2.375%, 08/15/06 $ $ 4,939,870 $ 4,939,870
65,000 65,000 Federal Home Loan Bank, 3.875%, 6/14/13 62,728 62,728
1,891,991 1,891,991 Federal Home Loan Mortgage Corp., 5.5%,
11/1/34 1,923,270 1,923,270
6,346,083 6,346,083 Federal Home Loan Mortgage Corp., 6.0%,
5/1/34 6,558,791 6,558,791
1,157,283 1,157,283 Federal Home Loan Mortgage Corp.,6.0%,
5/1/34 1,196,072 1,196,072
2,233,468 2,233,468 Federal Home Loan Mortgage Corp.,6.0%,
9/1/33 2,308,216 2,308,216
338,844 338,844 Federal Home Loan Mortgage Corp.,6.0%,
12/1/33 351,013 351,013
79,655 79,655 Federal Home Loan Mortgage Corp., 6.5%,
1/1/29 83,742 83,742
21,000,000 21,000,000 Federal Home Loan Mortgage Corp., 3.8%,
8/3/7 21,026,250 21,026,250
1,205,315 1,205,315 Federal Home Loan Mortgage Corp., 5.5%,
9/1/33 1,225,584 1,225,584
2,228,769 2,228,769 Federal Home Loan Mortgage Corp., 5.5%,
12/1/18 2,315,929 2,315,929
597,992 597,992 Federal Home Loan Mortgage Corp., 6.0%,
1/1/33 618,005 618,005
413,088 413,088 Federal Home Loan Mortgage Corp., 6.0%,
1/1/34 426,913 426,913
1,574,999 1,574,999 Federal Home Loan Mortgage Corp., 6.0%,
1/1/34 1,627,790 1,627,790
1,029,849 1,029,849 Federal Home Loan Mortgage Corp., 6.0%,
2/1/33 1,065,315 1,065,315
795,480 795,480 Federal Home Loan Mortgage Corp., 6.0%,
3/1/33 822,878 822,878
139,590 139,590 Federal Home Loan Mortgage Corp., 6.0%,
3/1/33 144,262 144,262
2,823,271 2,823,271 Federal Home Loan Mortgage Corp., 6.0%,
3/1/33 2,920,507 2,920,507
2,855,377 2,855,377 Federal Home Loan Mortgage Corp., 6.0%,
8/1/34 2,951,083 2,951,083
1,460,301 1,460,301 Federal Home Loan Mortgage Corp., 6.0%,
12/1/33 1,509,173 1,509,173
412,497 412,497 Federal Home Loan Mortgage Corp., 6.0%,
12/1/33 426,302 426,302
10,000,000 10,000,000 Federal Home Loan Mortgage Corp., 6.25%,
3/5/12 10,462,500 10,462,500
29,254 29,254 Federal Home Loan Mortgage Corp., 6.5%,
4/1/31 30,710 30,710
204,577 204,577 Federal Home Loan Mortgage Corp., 6.5%,
7/1/32 214,814 214,814
486,045 486,045 Federal Home Loan Mortgage Corp., 6.5%,
7/1/33 512,066 512,066
927,496 927,496 Federal Home Loan Mortgage Corp., 6.5%,
10/1/33 976,911 976,911
940,173 940,173 Federal Home Loan Mortgage Corp., 6.5%,
10/1/33 991,433 991,433
9,139 9,139 Federal Home Loan Mortgage Corp., 7.0%,
6/1/31 9,688 9,688
10,157 10,157 Federal Home Loan Mortgage Corp., 7.0%,
12/1/30 10,769 10,769
26,254 26,254 Federal Home Loan Mortgage Corp., 8.0%,
9/15/06 26,333 26,333
10,000,000 10,000,000 Federal National Mortgage Association,
2.625%, 01/19/07 9,878,820 9,878,820
5,000,000 5,000,000 Federal National Mortgage Association,
3.52%, 01/28/08 5,001,300 5,001,300
21,000,000 21,000,000 Federal National Mortgage Association,
3.75%, 09/15/08 20,921,250 20,921,250
257,913 257,913 Federal National Mortgage Association,
4.816%, 12/1/12 263,576 263,576
207,477 207,477 Federal National Mortgage Association, 5.0%,
3/1/33 206,260 206,260
163,278 163,278 Federal National Mortgage Association, 5.0%,
5/1/34 162,083 162,083
316,692 316,692 Federal National Mortgage Association, 5.0%,
12/1/17 322,157 322,157
140,000 140,000 Federal National Mortgage Association,
5.24%, 8/7/18 139,625 139,625
11,392,568 11,392,568 Federal National Mortgage Association, 5.5%,
12/01/17 11,791,308 11,791,308
301,678 301,678 Federal National Mortgage Association, 5.5%,
2/1/18 313,223 313,223
1,191,751 1,191,751 Federal National Mortgage Association, 5.5%,
4/1/19 1,232,983 1,232,983
113,798 113,798 Federal National Mortgage Association, 5.5%,
7/1/23 116,411 116,411
2,794,986 2,794,986 Federal National Mortgage Association, 5.5%,
7/1/33 2,839,932 2,839,932
267,482 267,482 Federal National Mortgage Association, 5.5%,
9/1/17 276,736 276,736
4,581,285 4,581,285 Federal National Mortgage Association, 5.5%,
9/1/19 4,737,754 4,737,754
1,327,888 1,327,888 Federal National Mortgage Association, 5.5%,
11/1/33 1,349,242 1,349,242
1,577,841 1,577,841 Federal National Mortgage Association, 5.5%,
12/1/18 1,632,039 1,632,039
10,788 10,788 Federal National Mortgage Association, 6.0%,
1/1/29 11,194 11,194
125,946 125,946 Federal National Mortgage Association, 6.0%,
2/1/32 130,408 130,408
1,371,350 1,371,350 Federal National Mortgage Association, 6.0%,
2/1/33 1,419,905 1,419,905
145,191 145,191 Federal National Mortgage Association, 6.0%,
3/1/33 150,199 150,199
3,118,552 3,118,552 Federal National Mortgage Association, 6.0%,
4/1/33 3,226,105 3,226,105
1,286,301 1,286,301 Federal National Mortgage Association, 6.0%,
4/1/34 1,330,750 1,330,750
195,000 195,000 Federal National Mortgage Association, 6.0%,
4/15/32 203,857 203,857
659,000 659,000 Federal National Mortgage Association, 6.0%,
6/1/16 690,980 690,980
5,344,094 5,344,094 Federal National Mortgage Association, 6.0%,
07/1/33 5,529,427 5,529,427
2,951,240 2,951,240 Federal National Mortgage Association, 6.0%,
7/1/33 3,053,022 3,053,022
89,752 89,752 Federal National Mortgage Association, 6.0%,
8/1/32 92,930 92,930
1,821,851 1,821,851 Federal National Mortgage Association, 6.0%,
9/1/34 1,884,807 1,884,807
|
20,732 20,732 Federal National Mortgage Association, 6.0%,
9/1/29 21,485 21,485
1,224,960 1,224,960 Federal National Mortgage Association, 6.0%,
10/1/32 1,268,333 1,268,333
307,518 307,518 Federal National Mortgage Association, 6.0%,
11/1/32 318,406 318,406
18,269 18,269 Federal National Mortgage Association, 6.5%,
1/1/15 19,388 19,388
150,988 150,988 Federal National Mortgage Association, 6.5%,
2/1/32 158,503 158,503
250,352 250,352 Federal National Mortgage Association, 6.5%,
2/1/32 262,775 262,775
398,163 398,163 Federal National Mortgage Association, 6.5%,
3/1/32 417,920 417,920
195,535 195,535 Federal National Mortgage Association, 6.5%,
5/1/31 205,268 205,268
355,448 355,448 Federal National Mortgage Association, 6.5%,
6/1/31 373,250 373,250
97,704 97,704 Federal National Mortgage Association, 6.5%,
7/1/29 102,671 102,671
85,804 85,804 Federal National Mortgage Association, 6.5%,
7/1/34 90,012 90,012
171,810 171,810 Federal National Mortgage Association, 6.5%,
8/1/31 180,362 180,362
165,506 165,506 Federal National Mortgage Association, 6.5%,
9/1/31 173,745 173,745
134,738 134,738 Federal National Mortgage Association, 6.5%,
10/1/31 141,445 141,445
54,554 54,554 Federal National Mortgage Association, 6.5%,
10/1/31 57,269 57,269
453,709 453,709 Federal National Mortgage Association, 6.5%,
10/1/32 476,222 476,222
256,899 256,899 Federal National Mortgage Association, 7.0%,
1/1/32 272,338 272,338
23,289 23,289 Federal National Mortgage Association, 7.0%,
3/1/12 24,693 24,693
126,564 126,564 Federal National Mortgage Association, 7.0%,
4/1/31 134,211 134,211
79,847 79,847 Federal National Mortgage Association, 7.0%,
7/1/22 85,076 85,076
206,230 206,230 Federal National Mortgage Association, 7.0%,
8/1/31 218,623 218,623
145,411 145,411 Federal National Mortgage Association, 7.0%,
9/1/31 154,150 154,150
215,397 215,397 Federal National Mortgage Association, 7.0%,
12/1/31 228,341 228,341
14,064 14,064 Federal National Mortgage Association, 7.0%,
12/1/30 14,914 14,914
51,029 51,029 Federal National Mortgage Association, 7.0%,
12/1/30 54,112 54,112
5,000,000 5,000,000 Federal National Mortgage Association,
7.125%, 3/15/7 5,404,100 5,404,100
4,643 4,643 Federal National Mortgage Association, 7.5%,
4/1/30 4,975 4,975
16,060 16,060 Federal National Mortgage Association, 7.5%,
8/1/20 17,259 17,259
6,715 6,715 Federal National Mortgage Association, 8.0%,
1/1/31 7,281 7,281
19,097 19,097 Federal National Mortgage Association, 8.0%,
2/1/29 20,782 20,782
9,735 9,735 Federal National Mortgage Association, 8.0%,
2/1/30 10,583 10,583
1,866 1,866 Federal National Mortgage Association, 8.0%,
2/1/30 2,028 2,028
83,416 83,416 Federal National Mortgage Association, 8.0%,
3/1/31 90,678 90,678
11,901 11,901 Federal National Mortgage Association, 8.0%,
4/1/08 12,459 12,459
15,023 15,023 Federal National Mortgage Association, 8.0%,
4/1/20 16,294 16,294
6,463 6,463 Federal National Mortgage Association, 8.0%,
4/1/30 7,008 7,008
3,739 3,739 Federal National Mortgage Association, 8.0%,
5/1/31 4,054 4,054
3,966 3,966 Federal National Mortgage Association, 8.0%,
7/1/30 4,300 4,300
5,606 5,606 Federal National Mortgage Association, 8.0%,
10/1/30 6,079 6,079
128,744 128,744 Federal National Mortgage Association, 7.0%,
10/25/07 132,598 132,598
22,765 22,765 Federal National Mortgage Association,
10.3%, 4/25/19 24,739 24,739
7,751 7,751 Federal National Mortgage Association,
10.3%, 4/25/19 9,508 9,508
2,876,936 2,876,936 Government National Mortgage Association,
4.5%, 8/15/33 2,810,001 2,810,001
2,134,586 2,134,586 Government National Mortgage Association,
4.5%, 8/15/33 2,084,923 2,084,923
1,380,446 1,380,446 Government National Mortgage Association,
4.5%, 9/15/33 1,348,328 1,348,328
1,514,381 1,514,381 Government National Mortgage Association,
4.5%, 10/15/33 1,479,148 1,479,148
2,212,685 2,212,685 Government National Mortgage Association,
5.0%, 4/15/34 2,215,407 2,215,407
1,099,891 1,099,891 Government National Mortgage Association,
5.0%, 7/15/19 1,129,068 1,129,068
25,000 25,000 Government National Mortgage Association,
5.0%, 7/15/19 25,647 25,647
1,036,481 1,036,481 Government National Mortgage Association,
5.0%, 9/15/33 1,038,717 1,038,717
24,270 24,270 Government National Mortgage Association,
5.5%, 4/15/19 25,311 25,311
2,342,560 2,342,560 Government National Mortgage Association,
5.5%, 4/20/34 2,391,554 2,391,554
3,815,049 3,815,049 Government National Mortgage Association,
5.5%, 7/15/34 3,898,427 3,898,427
2,497,775 2,497,775 Government National Mortgage Association,
5.5%, 8/15/19 2,604,939 2,604,939
2,726,106 2,726,106 Government National Mortgage Association,
5.5%, 8/15/19 2,843,066 2,843,066
269,725 269,725 Government National Mortgage Association,
5.5%, 8/15/33 275,742 275,742
563,578 563,578 Government National Mortgage Association,
5.5%, 10/15/17 587,823 587,823
319,969 319,969 Government National Mortgage Association,
5.5%, 10/15/33 327,106 327,106
|
1,242,666 1,242,666 Government National Mortgage Association,
5.5%, 10/15/34 1,269,825 1,269,825
1,214,524 1,214,524 Government National Mortgage Association,
5.5%, 10/20/19 1,262,842 1,262,842
933,701 933,701 Government National Mortgage Association,
5.5%, 11/15/18 973,814 973,814
2,597,153 2,597,153 Government National Mortgage Association,
5.5%, 11/15/34 2,653,914 2,653,914
249,481 249,481 Government National Mortgage Association,
5.5%, 11/20/34 254,699 254,699
343,209 343,209 Government National Mortgage Association,
5.5%, 12/15/18 357,954 357,954
55,000 55,000 Government National Mortgage Association,
5.5%, 12/15/34 56,202 56,202
679,599 679,599 Government National Mortgage Association,
6.0%, 1/15/33 704,797 704,797
1,624,412 1,624,412 Government National Mortgage Association,
6.0%, 1/15/33 1,685,759 1,685,759
439,794 439,794 Government National Mortgage Association,
6.0%, 2/15/33 456,101 456,101
27,887 27,887 Government National Mortgage Association,
6.0%, 3/15/32 28,937 28,937
757,115 757,115 Government National Mortgage Association,
6.0%, 3/15/33 785,187 785,187
1,093,589 1,093,589 Government National Mortgage Association,
6.0%, 3/15/33 1,134,136 1,134,136
1,125,452 1,125,452 Government National Mortgage Association,
6.0%, 3/15/33 1,167,180 1,167,180
2,096,619 2,096,619 Government National Mortgage Association,
6.0%, 3/15/33 2,174,355 2,174,355
1,383,086 1,383,086 Government National Mortgage Association,
6.0%, 3/15/33 1,435,379 1,435,379
1,782,336 1,782,336 Government National Mortgage Association,
6.0%, 3/15/33 1,849,879 1,849,879
6,171 6,171 Government National Mortgage Association,
6.0%, 4/15/14 6,510 6,510
925,980 925,980 Government National Mortgage Association,
6.0%, 4/15/33 960,312 960,312
639,737 639,737 Government National Mortgage Association,
6.0%, 5/1/17 670,101 670,101
884,171 884,171 Government National Mortgage Association,
6.0%, 5/15/17 931,676 931,676
1,835,904 1,835,904 Government National Mortgage Association,
6.0%, 5/15/33 1,903,974 1,903,974
179,022 179,022 Government National Mortgage Association,
6.0%, 6/15/17 188,641 188,641
189,195 189,195 Government National Mortgage Association,
6.0%, 6/18/33 196,210 196,210
873,483 873,483 Government National Mortgage Association,
6.0%, 7/15/33 875,368 875,368
25,523 25,523 Government National Mortgage Association,
6.0%, 8/15/13 26,925 26,925
106,024 106,024 Government National Mortgage Association,
6.0%, 8/15/32 110,135 110,135
1,715,368 1,715,368 Government National Mortgage Association,
6.0%, 9/15/19 1,807,190 1,807,190
540,367 540,367 Government National Mortgage Association,
6.0%, 9/15/32 560,706 560,706
51,772 51,772 Government National Mortgage Association,
6.0%, 9/15/32 53,721 53,721
573,228 573,228 Government National Mortgage Association,
6.0%, 9/15/34 594,516 594,516
515,055 515,055 Government National Mortgage Association,
6.0%, 10/15/32 534,440 534,440
1,026,756 1,026,756 Government National Mortgage Association,
6.0%, 10/15/33 1,064,825 1,064,825
1,497,224 1,497,224 Government National Mortgage Association,
6.0%, 10/15/34 1,552,826 1,552,826
325,616 325,616 Government National Mortgage Association,
6.0%, 11/15/32 337,871 337,871
124,080 124,080 Government National Mortgage Association,
6.5%, 08/15/11 132,184 132,184
142,574 142,574 Government National Mortgage Association,
6.5%, 01/15/29 150,326 150,326
200,916 200,916 Government National Mortgage Association,
6.5%, 03/15/29 211,840 211,840
311,396 311,396 Government National Mortgage Association,
6.5%, 04/20/29 327,645 327,645
8,067,598 8,067,598 Government National Mortgage Association,
6.5%, 06/15/31 8,501,231 8,501,231
1,523,601 1,523,601 Government National Mortgage Association,
6.5%, 10/15/32 1,605,747 1,605,747
5,485,775 5,485,775 Government National Mortgage Association,
6.5%, 12/15/32 5,781,500 5,781,500
385,154 385,154 Government National Mortgage Association,
6.5%, 1/15/34 405,530 405,530
614,358 614,358 Government National Mortgage Association,
6.5%, 1/15/34 646,860 646,860
81,669 81,669 Government National Mortgage Association,
6.5%, 2/15/29 86,078 86,078
533,542 533,542 Government National Mortgage Association,
6.5%, 2/15/32 562,142 562,142
732,729 732,729 Government National Mortgage Association,
6.5%, 3/15/29 772,286 772,286
143,638 143,638 Government National Mortgage Association,
6.5%, 3/15/29 151,392 151,392
127,915 127,915 Government National Mortgage Association,
6.5%, 3/15/31 134,770 134,770
837,165 837,165 Government National Mortgage Association,
6.5%, 5/15/29 882,836 882,836
325,497 325,497 Government National Mortgage Association,
6.5%, 5/15/31 342,946 342,946
141,147 141,147 Government National Mortgage Association,
6.5%, 5/15/32 148,713 148,713
39,111 39,111 Government National Mortgage Association,
6.5%, 6/15/31 41,207 41,207
449,260 449,260 Government National Mortgage Association,
6.5%, 8/15/32 473,342 473,342
533,956 533,956 Government National Mortgage Association,
6.5%, 9/15/32 562,578 562,578
407,738 407,738 Government National Mortgage Association,
6.5%, 10/15/31 429,589 429,589
21,802 21,802 Government National Mortgage Association,
6.5%, 10/15/33 22,956 22,956
879,449 879,449 Government National Mortgage Association,
7.0%, 05/15/32 934,960 934,960
|
744,762 744,762 Government National Mortgage Association,
7.0%, 11/20/28 790,379 790,379
225,501 225,501 Government National Mortgage Association,
7.0%, 09/15/11 240,298 240,298
1,638,401 1,638,401 Government National Mortgage Association,
7.0%, 08/15/31 1,741,817 1,741,817
87,160 87,160 Government National Mortgage Association,
7.0%, 2/15/30 92,649 92,649
73,385 73,385 Government National Mortgage Association,
7.0%, 3/15/31 77,999 77,999
18,552 18,552 Government National Mortgage Association,
7.0%, 4/15/28 19,749 19,749
179,195 179,195 Government National Mortgage Association,
7.0%, 4/15/29 190,612 190,612
54,197 54,197 Government National Mortgage Association,
7.0%, 4/15/31 57,606 57,606
195,544 195,544 Government National Mortgage Association,
7.0%, 6/15/31 207,840 207,840
364,864 364,864 Government National Mortgage Association,
7.0%, 6/15/31 387,842 387,842
14,659 14,659 Government National Mortgage Association,
7.0%, 8/15/28 15,605 15,605
463,520 463,520 Government National Mortgage Association,
7.0%, 11/15/28 493,495 493,495
198,918 198,918 Government National Mortgage Association,
7.0%, 11/15/28 211,782 211,782
55,880 55,880 Government National Mortgage Association,
7.0%, 12/15/13 59,543 59,543
33,692 33,692 Government National Mortgage Association,
7.0%, 12/15/30 35,814 35,814
109,314 109,314 Government National Mortgage Association,
7.5%, 08/15/11 116,521 116,521
32,864 32,864 Government National Mortgage Association,
7.5%, 2/15/26 35,394 35,394
38,137 38,137 Government National Mortgage Association,
7.5%, 2/15/31 40,959 40,959
84,480 84,480 Government National Mortgage Association,
7.5%, 5/15/27 90,931 90,931
95,260 95,260 Government National Mortgage Association,
7.5%, 8/15/29 102,334 102,334
33,672 33,672 Government National Mortgage Association,
7.5%, 10/15/29 36,173 36,173
460,773 460,773 Government National Mortgage Association,
7.5%, 12/15/31 494,873 494,873
25,672 25,672 Government National Mortgage Association,
7.75%, 2/15/30 27,717 27,717
7,915 7,915 Government National Mortgage Association,
7.75%, 11/15/29 8,548 8,548
80,564 80,564 Government National Mortgage Association,
8.0%, 05/15/10 86,077 86,077
4,285 4,285 Government National Mortgage Association,
9.5%, 5/15/20 4,835 4,835
10,311 10,311 Government National Mortgage Association,
10.0%, 1/15/06 10,779 10,779
2,362 2,362 Government National Mortgage Association,
10.0%, 1/15/18 2,630 2,630
7,658 7,658 Government National Mortgage Association,
10.0%, 1/15/18 8,527 8,527
677,103 677,103 Government National Mortgage Association I,
6.0%, 2/15/29 703,726 703,726
3,318,670 3,318,670 Government National Mortgage Association I,
6.50%, 07/15/32 3,498,077 3,498,077
75,413 75,413 Government National Mortgage Association I,
7.0%, 12/15/30 80,162 80,162
453,100 453,100 Government National Mortgage Association II,
5.5%, 2/20/34 462,576 462,576
2,734,106 2,734,106 Government National Mortgage Association II,
5.5%, 3/20/34 2,791,290 2,791,290
10,924,479 10,924,479 Government National Mortgage Association II,
6.0%, 11/20/33 11,315,870 11,315,870
21,593 21,593 Government National Mortgage Association II,
6.5%, 2/20/29 22,711 22,711
10,901 10,901 Government National Mortgage Association II,
6.5%, 3/20/29 11,466 11,466
381,933 381,933 Government National Mortgage Association II,
7.0%, 1/20/29 404,956 404,956
27,699 27,699 Government National Mortgage Association II,
7.0%, 12/20/30 29,348 29,348
135,000 135,000 U.S. Treasury Bonds, 3.125%, 10/15/08 133,560 133,560
100,000 100,000 U.S. Treasury Bonds, 4.0%, 2/15/14 98,621 98,621
35,000 35,000 U.S. Treasury Bonds, 4.25%, 8/15/13 35,276 35,276
20,000,000 20,000,000 U.S. Treasury Bonds, 5.5%, 08/15/28 21,653,140 21,653,140
64,900,000 64,900,000 U.S. Treasury Bonds, 6.25%, 08/15/23 76,001,470 76,001,470
135,000 135,000 U.S. Treasury Bonds, 7.125%, 2/15/23 172,267 172,267
19,000,000 19,000,000 U.S. Treasury Bonds, 7.50%, 11/15/16 24,286,617 24,286,617
1,000,000 1,000,000 U.S. Treasury Bonds, 8.0%, 11/15/21 1,372,695 1,372,695
|
35,000 35,000 U.S. Treasury Notes, 1.5%, 7/31/05 34,785 34,785
30,000,000 30,000,000 U.S. Treasury Notes, 3.00%, 02/15/09 29,475,000 29,475,000
340,000 340,000 U.S. Treasury Notes, 3.5%, 1/15/11 417,054 417,054
38,000,000 38,000,000 U.S. Treasury Notes, 4.25%, 11/15/13 38,250,876 38,250,876
100,000 100,000 U.S. Treasury Notes, 5.25%, 2/15/29 104,899 104,899
7,260,000 7,260,000 U.S. Treasury Notes, 5.375%, 2/15/31 7,850,442 7,850,442
120,000 120,000 U.S. Treasury Notes, 5.5%, 8/15/28 129,881 129,881
105,000 105,000 U.S. Treasury Notes, 6.0%, 8/15/09 115,804 115,804
135,000 135,000 U.S. Treasury Notes, 7.0%, 7/15/06 143,132 143,132
-----------------------------------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS $153,440,708 $308,740,529 $462,181,237
-----------------------------------------
FOREIGN GOVERNMENT BOND 0.34%
3,000,000 3,000,000 British Columbia, 4.625%, 10/03/06 $ $ 3,072,402 $ 3,072,402
-----------------------------------------
TOTAL FOREIGN GOVERNMENT BOND $ $ 3,072,402 $ 3,072,402
-----------------------------------------
MUNICIPAL BONDS 0.36%
Government 0.35%
800,000 800,000 Atlanta Downtown Development Lease Revenue
Bond, 6.88%, 2/1/21 $ $ 941,000 $ 941,000
1,225,000 1,225,000 District of Columbia Tobacco Settlement
Financing Corp., 6.75%, 5/15/40 1,215,090 1,215,090
555,000 555,000 Tobacco Settlement Authority Iowa, 6.79%,
6/1/10 553,090 553,090
500,000 500,000 Tobacco Settlement Financing Corp. Revenue,
5.875%, 5/15/39 448,450 448,450
-----------------------------------------
$ 2,216,630 $ 941,000 $ 3,157,630
-----------------------------------------
Municipal Power 0.01%
105,000 105,000 California State Department of Water
Resources & Power Supply, 4.33%, 5/1/06 $ 106,066 $ $ 106,066
-----------------------------------------
TOTAL MUNICIPAL BONDS $ 2,322,696 $ 941,000 $ 3,263,696
-----------------------------------------
Shares Shares Shares
------ ------ ------
MONEY MARKET MUTUAL FUNDS 2.19%
3,258,802 3,258,802 AmSouth Prime Money Market Fund $ $ 3,258,802 $ 3,258,802
9,478 9,478 AmSouth Treasury Reserve Money Market Fund 9,478 9,478
16,668,342 16,668,342 Goldman Sachs Financial Square Funds - Prime
Obligation Fund 16,668,342 16,668,342
-----------------------------------------
TOTAL MONEY MARKET MUTUAL FUNDS $ $ 19,936,622 $ 19,936,622
-----------------------------------------
Principal Principal Principal
Amount Amount Amount TEMPORARY CASH INVESTMENTS 1.31%
------ ------ ------
Repurchase Agreement 0.83%
7,600,000 7,600,000 UBS Warburg, Inc., 1.00%, dated 12/31/04,
repurchase price of 7,600,000 plus accrued
interest on 1/3/05 collateralized by
$7,572,000 U.S. Treasury Bill, 6.75%,
5/15/05 $ 7,600,000 $ $ 7,600,000
-----------------------------------------
Shares Shares Shares
------ ------ ------
Security Lending Collateral 0.48%
4,350,803 4,350,803 Securities Lending Investment Fund, 2.18% $ 4,350,803 $ $ 4,350,803
-----------------------------------------
TOTAL TEMPORARY CASH INVESTMENTS $ 11,950,803 $ $ 11,950,803
-----------------------------------------
TOTAL INVESTMENTS IN SECURITIES 99.47% $271,778,275 $635,323,923 $907,102,198
-----------------------------------------
OTHER ASSETS AND LIABILITIES 0.53% $ (3,696,039) $ 8,545,559 $ 4,849,520
-----------------------------------------
TOTAL NET ASSETS 100.00% $268,082,236 $643,869,482 $911,951,718
=========================================
Total Investments at Cost $265,866,085 $610,669,561 $876,535,646
=========================================
|
* Non-Income producing security
144A Security is exempt from registration under Rule 144A of the Securities Act
of 1933. Such securities may be resold normally to qualified institutional
buyers in a transaction exempt from registration. At December 31, 2004, the
value of these securities amounted to $19,828,206 or 7.4% of net assets.
(a) No adjustments are shown to the unaudited pro forma combined schedule of
investments due to the fact that upon consumation of the merger no
securities would need to be sold in order for Pioneer Bond Fund to comply
with its prospectus restrictions. The foregoing sentence shall not restrict
in any way the ability of the investment adviser of the funds from buying
or selling securities in the normal course of such fund's business and
operations.
The accompanying notes are an integral part of these pro forma financial statements.
Pioneer Bond Fund
Pro Forma Statement of Assets and Liabilities
December 31, 2004
(unaudited) (Amounts in Thousands, except for per share data)
AmSouth High
Pioneer Bond Quality Bond Pro Forma Pro Forma
Fund Fund Adjustments Combined
------------ ------------ ----------- ---------
ASSETS:
Investment in securities (including securities loaned of $4,174 and
$0, respectively) (Cost $265,866 and $610,670, respectively) $ 271,778 $ 635,324 $ $ 907,102
Cash 704 - 704
Receivables -
Investment securities sold 2 - 2
Fund shares sold 631 - 631
Dividends, interest and foreign taxes withheld 2,510 8,723 11,233
Other 49 120 169
--------- --------- ---------
Total assets $ 275,674 $ 644,167 $ 919,841
--------- --------- ---------
LIABILITIES:
Payables -
Investment securities purchased $ 2,226 $ - $ $ 2,226
Fund shares repurchased 282 17 299
Upon return of securities loaned 4,351 - 4,351
Dividends 335 - 335
Due to affiliates 328 187 515
Accrued expenses 70 94 164
--------- --------- ---------
Total liabilities $ 7,592 $ 298 $ $ 7,890
--------- --------- ---------
NET ASSETS:
Paid-in capital $ 265,160 $ 621,685 $ $ 886,845
Undistributed net investment loss (37) (3,229) (3,266)
Accumulated net realized loss on investments (2,953) 759 (2,194)
Net unrealized gain on investments 5,912 24,654 30,566
--------- --------- ---------
Total net assets $ 268,082 $ 643,869 $ $ 911,951
========= ========= =========
OUTSTANDING SHARES:
(Unlimited number of shares authorized)
Investor Class 975 - - 975
========= ========= =========
Class A 17,549 4,375 802 (a) 22,726
========= ========= =========
Class I 53,022 (53,022) (a) -
========= ========= =========
Class B 5,820 603 112 (a) 6,535
========= ========= =========
Class C 3,020 - 3,020
========= ========= =========
Class R 105 - 105
========= ========= =========
Class Y 1,164 - 63,149 (a) 64,313
========= ========= =========
NET ASSET VALUE PER SHARE:
Investor Class $ 9.39 $ 11.10 $ $ 9.39
========= ========= =========
Class A $ 9.38 $ - $ $ 9.38
========= ========= =========
Class I 11.10
========= ========= =========
Class B $ 9.34 $ 11.07 $ $ 9.34
========= ========= =========
Class C $ 9.31 $ - $ $ 9.31
========= ========= =========
Class R $ 9.48 $ - $ $ 9.48
========= ========= =========
Class Y $ 9.32 $ - $ $ 9.32
========= ========= =========
MAXIMUM OFFERING PRICE:
Class A $ 9.82 $ 11.56 $ $ 9.82
========= ========= =========
|
(a) Class A, Class B, and Class I shares of AmSouth High Quality Bond Fund are exchanged for Class A, Class B, and Class Y shares of Pioneer Bond Fund.
Pioneer Bond Fund
Pro Forma Statement of Operations
For the Period Ended December 31, 2004
(unaudited) (Amounts in Thousands)
AmSouth High
Pioneer Bond Quality Bond Pro Forma Pro Forma
Fund Fund Adjustments Combined
------------ ------------ ----------- ---------
INVESTMENT INCOME:
Interest $ 15,284 $ 30,275 $ 45,559
Income from securities loaned, net 16 - 16
-------- -------- --------
Total investment income $ 15,300 $ 30,275 $ 45,575
EXPENSES:
Management fees $ 1,330 $ 4,052 $ (880) (c) $ 4,502
Transfer agent fees - 211 (211) (c) -
Investor Class 1 - 1
Class A 486 - 137 (c) 623
Class B 230 - 31 (c) 261
Class C 86 - 86
Class R 1 - 1
Class Y (7) - 116 (c) 109
Distribution fees
Class I 874 (874) (c) -
Class A 412 114 526
Class B 593 76 - 669
Class C 285 - 285
Class R 3 - 3
Administrative fees 54 1,396 (1,250) (c) 200
Custodian fees 23 175 (112) (c) 86
Registration fees 92 15 - 107
Professional fees 62 126 (126) (a) 62
Printing (18) 52 - 34
Fees and expenses of nonaffiliated trustees 4 25 (25) (a) 4
Miscellaneous 5 68 73
-------- -------- -------- --------
Total expenses $ 3,642 $ 7,184 $ (3,194) $ 7,632
Less management fees waived by Advisor (63) (1,692) 1,650 (b) (105)
Less fees paid indirectly (4) - (4)
-------- -------- -------- --------
Net expenses $ 3,575 $ 5,492 $ (1,544) $ 7,523
-------- -------- -------- --------
Net investment Income $ 11,725 $ 24,783 $ 1,544 $ 38,052
-------- -------- -------- --------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain (loss) on investments $ 7,541 $ 1,050 $ 8,591
Change in net unrealized gain on investments (5,391) 24,654 19,263
-------- -------- -------- --------
Net gain on investments $ 2,150 $ 25,704 $ 27,854
-------- -------- -------- --------
Net increase in net assets resulting from operations $ 13,875 $ 50,487 $ 1,544 $ 65,906
======== ======== ======== ========
|
(a) Reflects reduction in expenses due to elimination of duplicate
services.
(b) Expense limitation conformed to Pioneer Bond Fund's management
contract.
(c) Reflects change in fee structure to conform to Pioneer Bond Fund's
management, tranfer agent, custody and distribution plan agreements.
See accompanying notes to pro forma financial statements.
Pioneer Bond Fund
PRO FORMA NOTES TO COMBINING FINANCIAL STATEMENTS
12/31/04
(Unaudited)
1. Description of the Fund
Pioneer Bond Fund (the Fund) is a Delaware statutory trust registered under the Investment Company Act of 1940 as a diversified, open-end management investment company. The investment objective of the Fund is to seek current income consistent with preservation of capital.
The Trustees have authorized the issuance of six classes of shares of the Fund. The Fund offers six classes of shares - Class A, Class B, Class C, Investor Class, Class R, and Class Y shares. Class R shares were first publicly offered on April 1, 2003. Investor Class shares were first publicly offered on December 10, 2004. The Fund is not offering additional Investor Class shares except in connection with the reinvestment dividends on the Fund's Outstanding Investor Class shares. Each class of shares represents an interest in the same portfolio of investments of the Fund and has equal rights to voting, redemptions, dividends and liquidation, except that the level of transfer agent and distribution fees may differ among classes. Class A, Class B, Class C, and Class R shareowners have exclusive voting rights with respect to the distribution plan for each class. There is no distribution plan for Class Y shares and Investor Class shares.
2. Basis of Combination
The accompanying pro forma combining financial statements, and related notes, are presented to show the effect of the proposed acquisition (the "acquisition") of AmSouth High Quality Bond Fund by the Fund, as if such acquisition had taken place as of January 1, 2004.
Under the terms of an Agreement and Plan of Reorganization (the "Reorganization") between these two Funds, the combination of the Fund and AmSouth High Quality Bond Fund will be treated as a tax-free business combination and accordingly will be accounted for by a method of accounting for tax-free mergers of investment companies. The acquisition will be accomplished by an acquisition of the net assets of AmSouth
High Quality Bond Fund in exchange for shares of the Fund at their net asset values. The accompanying schedules of investments, statements of assets and liabilities and the related statements of operations of the Fund and AmSouth High Quality Bond Fund have been combined as of and for the most recent fiscal year ended December 31, 2004. Following the acquisition, the Fund will be the accounting survivor. All related acquisition costs will be borne by the Advisors.
These pro forma financial statements and related notes should be read in conjunction with the financial statements of the Fund and AmSouth High Quality Bond Fund included in their semi annual reports to shareowners dated December 31, 2004 and January 31, 2005, respectively. Adjustments have been made to expenses for Pioneer affiliate contractual rates and duplicate services that would not have been incurred if the merger took place on January 1, 2004.
3. Security Valuation
Security transactions are recorded as of trade date. Securities are valued at prices supplied by independent pricing services, which consider such factors as Treasury spreads, yields, maturities and ratings. Valuations may be supplemented by dealers and other sources, as required. Securities for which there are no other readily available valuation methods are valued at their fair values as determined by, or under the direction of the Board of Trustees. At December 31, 2004 there were no securities fair valued. Principal amounts of mortgage-backed securities are adjusted for monthly paydowns. Temporary cash investments are valued at amortized cost.
All discounts/premiums on debt securities are accreted/amortized for financial reporting purposes over the life of the respective securities, and are included in interest income. Market discount and premium are accreted or amortized daily. Premiums and discounts related to certain mortgage-backed securities are amortized or accreted in proportion to the underlying monthly paydowns. Interest income is recorded on the accrual basis.
4. Capital Shares
The pro forma net asset value per share assumes the issuance of shares of the Fund that would have been issued at December 31, 2004, in connection with the proposed acquisition. The number
of shares assumed to be issued is equal to the net asset value of shares of AmSouth High Quality Bond Fund, as of December 31, 2004, divided by the net asset value per share of the Fund's shares as of December 31, 2004. The pro forma number of shares outstanding, by class, for the combined Fund consists of the following at December 31, 2004:
---------------------------------------------------------------------------------------
Shares of Additional Shares Total Outstanding
The Fund Assumed Issued Shares
Class of Shares Pre-Combination In Reorganization Post-Combination
---------------------------------------------------------------------------------------
Class A 17,549 5,177 22,726
---------------------------------------------------------------------------------------
Class B 5,820 715 6,535
---------------------------------------------------------------------------------------
Class C 3,020 3,020
---------------------------------------------------------------------------------------
Class R 105 105
---------------------------------------------------------------------------------------
Class Y 1,164 63,149 64,313
---------------------------------------------------------------------------------------
Investor Class 975 975
---------------------------------------------------------------------------------------
|
5. Federal Income Taxes
Each Fund has elected to be taxed as a "regulated investment company" under the Internal Revenue Code. After the acquisition, it will continue to be the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income and net realized capital gains, if any, to its shareowners. Therefore, no federal income tax provision is required.
The identified cost of investments for these funds is substantially the same for both financial and federal income tax purposes. The cost of investments will remain unchanged for the combined Fund.
PART C
OTHER INFORMATION
PIONEER BOND FUND
ITEM 15. INDEMNIFICATION
No change from the information set forth in Item 25 of the most recently filed Registration Statement of Pioneer Bond Fund (the "Registrant") on Form N-1A under the Securities Act of 1933 and the Investment Company Act of 1940 (File Nos. 2-62436 and 811-02864) as filed with the Securities and Exchange Commission on December 8, 2004 (Accession No. 0001145443-04-002020), which information is incorporated herein by reference.
ITEM 16. EXHIBITS
(1)(a) Agreement and Declaration of Trust (1)
(1)(b) Amendment to Agreement and Declaration of Trust to establish (8)
Investor Class Shares
(2) Amended By-Laws (2)
(3) Not applicable
(4) Form of Agreement and Plan of Reorganization (9)
(5) Reference is made to Exhibits (1) and (2) hereof
(6)(a) Management Contract (4)
(6)(b) Expense Limitation Agreement for Investor Class Shares (8)
(6)(c) Expense Limitation Agreement (*)
(7)(a) Underwriting Agreement with Pioneer Funds Distributor, Inc. (3)
(7)(b) Dealer Sales Agreement (6)
(8) Not applicable
(9) Custodian Agreement with Brown Brothers Harriman & Co. (7)
(10)(a) Multiple Class Plan Pursuant to Rule 18f-3 (8)
|
(10)(b) Class A Shares Distribution Plan (2) (10)(c) Class B Shares Distribution Plan (4) (10)(d) Class C Shares Distribution Plan (1) (10)(e) Class R Shares Distribution Plan (5) (10)(f) Class R Shares Service Plan (5) (11) Opinion of Counsel (legality of securities being offered) (*) (12) Form of Opinion as to Tax matters and Consent (*) (13)(a) Investment Company Service Agreement (7) (13)(b) Administration Agreement (7) (14) Consent(s) of Independent Registered Public Accounting Firm (*) (15) Not applicable (16) Powers of Attorney (*) (17)(a) Code of Ethics (*) (17)(b) Form of Proxy Card (*) |
(1) Previously filed. Incorporated herein by reference from the exhibits filed with Post-Effective Amendment No. 28 to the Registrant's Registration Statement on Form N-1A (File Nos. 2-62436; 811-02864), as filed with the Securities and Exchange Commission on May 14, 1999 (Accession no. 0000276776-99-000013).
(2) Previously filed. Incorporated herein by reference from the exhibits filed with the Registrant's Registration Statement on Form N-14 (File No. 333-64582), as filed with the Securities and Exchange Commission on July 3, 2001 (Accession no. 0000276776-01-500004).
(3) Previously filed. Incorporated herein by reference from the exhibits filed with Post-Effective Amendment No. 34 to the Registrant's Registration Statement on Form N-1A (File Nos. 2-62436; 811-02864), as filed with the Securities and Exchange Commission on October 29, 2001 (Accession no. 0000276776-01-500036).
(4) Previously filed. Incorporated herein by reference from the exhibits filed with Post-Effective Amendment No. 35 to the Registrant's Registration Statement on Form N-1A
(File Nos. 2-62436; 811-02864), as filed with the Securities and Exchange Commission on October 29, 2002 (Accession no. 0000276776-02-000008).
(5) Previously filed. Incorporated herein by reference from the exhibits filed with Post-Effective Amendment No. 36 to the Registrant's Registration Statement on Form N-1A (File Nos. 2-62436; 811-02864), as filed with the Securities and Exchange Commission on February 24, 2003 (Accession no. 0000276776-03-000002).
(6) Previously filed. Incorporated herein by reference from the exhibits filed with Post-Effective Amendment No. 37 to the Registrant's Registration Statement on Form N-1A (File Nos. 2-62436; 811-02864), as filed with the Securities and Exchange Commission on October 29, 2003 (Accession no. 0000276776-03-000014).
(7) Previously filed. Incorporated herein by reference from the exhibits filed with Post-Effective Amendment No. 38 to the Registrant's Registration Statement on Form N-1A (File Nos. 2-62436; 811-02864), as filed with the Securities and Exchange Commission on October 28, 2003 (Accession no. 0001016964-04-000418).
(8) Previously filed. Incorporated herein by reference from the exhibits filed with Registrant's Registration Statement on Form N-14 (File No. 333-118442), as filed with the Securities and Exchange Commission on August 20, 2004 (Accession no. 0001145443-04-001275).
(9) Filed herewith as Exhibit A to the Proxy Statement and Prospectus included as Part A of this Registration Statement.
(*) Filed herewith.
ITEM 17. UNDERTAKINGS.
(1) The undersigned Registrant agrees that prior to any public reoffering of the securities registered through the use of a prospectus which is part of this Registration Statement by any person or party which is deemed to be an underwriter within the meaning of Rule 145(c) of the Securities Act of 1933, the reoffering prospectus will contain the information called for by the applicable registration form for the reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form.
(2) The undersigned Registrant agrees that every prospectus that is filed under paragraph (1) above will be filed as part of an amendment to the Registration Statement and will not be used until the amendment is effective, and that, in determining any liability under the Securities Act of 1933, each post-effective amendment shall be deemed to be a new registration statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them.
(3) The undersigned Registrant agrees that it shall file a final executed version of the legal and consent opinion as to tax matters as an exhibit to the subsequent post-effective amendment to its registration statement on Form N-1A filed with the SEC after the consummation of the reorganization contemplated by this Registration Statement on Form N-14.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement on Form N-14 has been signed on behalf of the Registrant, in the City of Boston and the Commonwealth of Massachusetts, on the 1st day of July, 2005.
Pioneer Bond Fund
By: /s/ Osbert M. Hood ------------------------------------ Osbert M. Hood Executive Vice President |
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated.
Signature Title Date
/s/ John F. Cogan, Jr. Chairman of the Board, July 1, 2005
---------------------- Trustee, and President
John F. Cogan, Jr.
/s/ Vincent Nave Chief Financial Officer, July 1, 2005
---------------------- Principal Accounting
Vincent Nave Officer, and Treasurer
* Trustee
----------------------
Mary K. Bush
* Trustee
----------------------
David R. Bock
* Trustee
----------------------
Margaret B.W. Graham
/s/ Osbert M. Hood Trustee July 1, 2005
----------------------
Osbert M. Hood
* Trustee
----------------------
Marguerite A. Piret
* Trustee
----------------------
Steven K. West
* Trustee
----------------------
John Winthrop
* By: /s/ Osbert M. Hood July 1, 2005
--------------------------------
Osbert M. Hood, Attorney-in-Fact
|
EXHIBIT INDEX
The following exhibits are filed as part of this Registration Statement:
Exhibit No. Description (6)(c) Expense Limitation Agreement (11) Opinion of Counsel (legality of securities being offered) (12) Form of Opinion as to Tax Matters and Consent (14) Consent(s) of Independent Registered Public Accounting Firm (16) Powers of Attorney (17)(a) Code of Ethics (17)(b) Form of Proxy Card |
EXPENSE LIMIT AGREEMENT
Expense Limit Agreement made as of July 1, 2005 between Pioneer Investment Management, Inc. ("PIM"), on behalf of itself and its affiliates, Pioneer Investment Management Shareholder Services, Inc. ("PIMSS") and Pioneer Funds Distributor, Inc. ("PFD"), and each of the Pioneer Funds listed on Annex A (each a "Fund").
Whereas PIM, PIMSS and PFD wish to reduce the expenses of each Fund; and
Whereas each Fund wishes to have PIM enter into such an agreement.
Now therefore the parties agree as follows:
SECTION 1 Special Class A Limitations. Effective September 1, 2005, the
expenses attributable to each class of shares of the Funds listed on Annex B
shall be reduced, if necessary, so that the Ordinary Operating Expenses (as
defined below) of each Fund attributable to such class of shares do not exceed
the percentage of average daily net assets attributable to the applicable class
of shares of such Fund set forth on Annex B. This expense limitation shall be
effected first by PIMSS waiving transfer agency fees and expenses allocated to
the applicable class of shares. If waiving transfer agency fees and expenses
alone is not sufficient to achieve the expense limitation reflected in Annex B,
PFD shall waive Rule 12b-1 fees attributable to the applicable class of shares.
In the event that waiving transfer agency fees and expenses and Rule 12b-1 fees
attributable to a class of shares is not sufficient to achieve the expense
limitation reflected in Annex B, PIM shall reimburse other expenses or waive
other fees ("Fund-wide Expenses") to the extent necessary to further reduce the
expenses attributable to that class of shares to the percentage of average daily
net assets reflected in Annex B. In the event that PIM waives or reimburses any
Fund-wide Expenses, PIM also agrees to waive or reimburse the Fund-wide Expenses
attributable to any other authorized class of shares to the same extent that
such expenses are reduced for the class of shares that required the reduction of
Fund-wide Expenses. Notwithstanding the forgoing, in the event that pursuant to
Section 2, PIM is waiving or reimbursing Fund-wide Expenses with respect to a
class of shares, the expenses of each class of shares shall be limited first by
waiving or reimbursing Fund-wide Expenses to the extent required by Section 2
and then by waiving class specific expenses.
SECTION 2 Expense Limitations for Other Funds. PIM agrees to limit the expenses attributable to each class of shares of each Fund listed in Annex C by waiving Fund-wide Expenses so that the Ordinary Operating Expenses of the Fund listed in Annex C with respect to the class of shares set forth in Annex C does not exceed the percentage of average daily net assets attributable to such class of shares on an annual basis. PIM also agrees to waive Fund-wide Expenses attributable to any other authorized class of a Fund's shares to the same extent that such expenses are reduced for the class of shares listed in Annex C. In no event, shall PFD be required to waive or PIM reimburse any fees payable under a Rule 12b-1 Plan with respect to the Funds listed in Annex C.
SECTION 3 Amendment or Termination of Expense Limits. PIM may terminate or modify these expense limitations only in accordance with this Agreement. PIM agrees that the
expense limitations set forth in Annex B may only be reduced after the date set forth with respect to such Fund in Annex B; provided, that Pioneer may extend the date reflected in Annex B from time to time. With respect to the Funds listed in Annex C, PIM shall be entitled to modify or terminate the expense limitation with respect to any fiscal year that commences subsequent to the date this Agreement is executed if, but only if, PIM elects to modify or terminate the expense limitation with respect to such subsequent fiscal year and such election is made prior to the effective date of the Fund's post-effective amendment to its Registration Statement on Form N-1A to incorporate the Fund's financial statements; provided that this Agreement shall remain in effect at all times with respect to a Fund until the Fund's then current prospectus is amended or supplemented to reflect the termination or modification of this Agreement. The election by PIM referred to in the preceding sentence shall not be subject to the approval of a Fund or its Board of Trustees, but PIM shall notify the Board of Trustees in advance of the termination or modification of the expense limitation.
SECTION 4 Termination of Expense Reimbursement Provisions. Notwithstanding anything to the contrary in any predecessor to this Agreement, PIM agrees that it shall not be entitled to be reimbursed for any expenses that PIM, PIMSS or PFD has waived or limited.
SECTION 5 Ordinary Operating Expenses. For purposes of this Agreement, Ordinary Operating Expenses means all expenses of the Funds other than extraordinary expenses, such as litigation, taxes and brokerage commissions.
SECTION 6 Governing Law. This Agreement shall be governed by the laws of the State of Delaware.
In witness whereof, the parties hereto have caused this Agreement to be signed as of the 1st day of July, 2005.
Each of the Funds Listed on Annex A
By: /s/ Vincent Nave
---------------------------------
Name: Vincent Nave
Title: Treasurer
|
PIONEER INVESTMENT MANAGEMENT, INC.
By: /s/ Dorothy E. Bourassa
---------------------------------
Name: Dorothy E. Bourassa
Title: Secretary
|
Annex A
Pioneer Bond Fund
Annex B
The expense limits listed on this Annex B are effective as of September 1, 2005.
---------------------------------------------------------------------------------------------------------------------
Fund Class A Expense Limit Class B Expense Limit Class C Expense Limit
---------------------------------------------------------------------------------------------------------------------
Pioneer Bond Fund 1.00% until November 1, 1.90% until November 1, 1.90% until December 1,
2007 2006 2006
---------------------------------------------------------------------------------------------------------------------
|
Annex C
[Wilmer Cutler Pickering Hale and Dorr LLP Letterhead]
June 29, 2005
Pioneer Bond Fund
60 State Street
Boston, Massachusetts 02109
Ladies and Gentlemen:
Pioneer Bond Fund (the "Trust") was established as a Delaware statutory trust under an Agreement and Declaration of Trust dated January 5, 1999, as amended from time to time (the "Declaration of Trust"). The beneficial interests thereunder are represented by transferable shares of beneficial interest, no par value.
The Trustees have the powers set forth in the Declaration of Trust, subject to
the terms, provisions and conditions therein provided. Pursuant to Article V,
Section 2 of the Declaration of Trust, the number of shares of beneficial
interest authorized to be issued under the Declaration of Trust is unlimited and
the Trustees are authorized to divide the shares into one or more series of
shares and one or more classes thereof as they deem necessary or desirable.
Pursuant to Article V, Sections 2 and 3 of the Declaration of Trust, the
Trustees are empowered in their discretion to issue shares of any series for
such amount and type of consideration, including cash or securities, and on such
terms as the Trustees may authorize, all without action or approval of the
shareholders. As of the date of this opinion, the Trustees have established six
classes of shares of the Trust, designated as Class A, Class B, Class C, Class
Y, Class R and Investor Class shares.
We have examined the Declaration of Trust and By-Laws, each as amended from time to time, of the Trust, and such other documents as we have deemed necessary or appropriate for the purposes of this opinion, including, but not limited to, originals, or copies certified or otherwise identified to our satisfaction, of such documents, Trust records and other instruments. In our examination of the above documents, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals and the conformity to original documents of all documents submitted to us as certified of photostatic copies.
Our opinions below are qualified to the extent that they may be subject to or affected by (i) applicable bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or similar laws affecting the rights and remedies of creditors generally, (ii) statutory or decisional law concerning recourse by creditors to security in the absence of notice or hearing and (iii) duties and standards imposed on creditors and parties to contracts, including, without limitation, requirements of good faith, reasonableness and fair dealing. Further, we do not express any opinion as to (i) the availability of the remedy of specific performance or any other equitable remedy upon breach of any provision of any agreement whether applied by a court of law or equity, (ii) the successful assertion of any equitable defense, or (iii) the right of any party to enforce the indemnification or contribution provisions of any agreement.
Pioneer Bond Fund
June 29, 2005
In rendering the opinion below, insofar as it relates to the good standing and valid existence of the Trust, we have relied solely on a certificate of the Secretary of the State of Delaware, dated as of a recent date, and such opinion is limited accordingly and is rendered as of the date of such certificate.
This opinion is limited to the Delaware Statutory Trust Act statute, and we express no opinion with respect to the laws of any other jurisdiction or to any other laws of the State of Delaware. Further, we express no opinion as to compliance with any state or federal securities laws, including the securities laws of the State of Delaware.
Our opinion below, as it relates to the non-assessability of the shares of the
Trust, is qualified to the extent that any shareholder is, was or may become a
named Trustee of the Trust. It is also qualified to the extent that, pursuant to
Section 2 of Article VIII of the Declaration of Trust, the Trustees have the
power to cause shareholders, or shareholders of a particular series, to pay
certain custodian, transfer, servicing or similar agent charges by setting off
the same against declared but unpaid dividends or by reducing share ownership
(or by both means).
Subject to the foregoing, we are of the opinion that the Trust is a duly organized and validly existing statutory trust in good standing under the laws of the State of Delaware and that the shares of beneficial interest of the Trust, when issued in accordance with the terms, conditions, requirements and procedures set forth in the Declaration of Trust, the Trust's Registration Statement on Form N-14, and the Agreement and Plan of Reorganization between the Trust and AmSouth Funds, on behalf of its series, AmSouth High Quality Bond Fund, will be validly issued, fully paid and non-assessable shares of beneficial interest in the Trust, subject to compliance with the Securities Act of 1933, as amended (the "Securities Act"), the Investment Company Act of 1940, as amended, and the applicable state laws regulating the sale of securities.
Please note that we are opining only as to the matters expressly set forth herein, and no opinion should be inferred as to any other matters. This opinion is based upon currently existing statutes, rules, regulations and judicial decisions, and we disclaim any obligation to advise you of any change in any of these sources of law or subsequent legal or factual developments which might affect any matters or opinions set forth herein.
We hereby consent to the filing of this opinion with the Securities and Exchange Commission (the "Commission") as an exhibit to the Trust's Registration Statement in accordance with the requirements of Form N-14 under the Securities Act. In giving such consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission.
Very truly yours,
WILMER CUTLER PICKERING
HALE AND DORR LLP
By: /s/ David C. Phelan
--------------------
David C. Phelan, Partner
|
DRAFT OF JUNE 30, 2005, SUBJECT TO CHANGE
__________, 2005
[Pioneer Fund/Trust]
60 State Street
Boston, Massachusetts 02109
AmSouth Funds
3435 Stelzer Road
Columbus, Ohio 43219
Ladies and Gentlemen:
This opinion is being delivered to you in connection with the Agreement and Plan
of Reorganization (the "Agreement") made as of ______, 2005 by and between
[Pioneer Fund/Trust], a [Delaware statutory/Massachusetts business] trust, on
behalf of its [sole] series, [Pioneer Fund] ("Acquiring Fund"), and AmSouth
Funds, a Massachusetts business trust, on behalf of its series, [AmSouth Fund]
("Acquired Fund"). Pursuant to the Agreement, Acquiring Fund will acquire all of
the assets of Acquired Fund in exchange solely for (i) the assumption by
Acquiring Fund of all of the Assumed Liabilities of Acquired Fund, as defined in
the Agreement (the "Acquired Fund Liabilities"), and (ii) the issuance of Class
A shares, Class B shares, and Class Y shares of beneficial interest of Acquiring
Fund (the "Acquiring Fund Shares") to Acquired Fund, followed by the
distribution by Acquired Fund, in liquidation of Acquired Fund, of the Acquiring
Fund Shares to the shareholders of Acquired Fund and the termination of Acquired
Fund (the foregoing together constituting the "Transaction"). All section
references, unless otherwise indicated, are to the United States Internal
Revenue Code of 1986, as amended (the "Code").
In rendering this opinion, we have examined and relied upon (i) the prospectus for Acquiring Fund dated ___________; (ii) the statement of additional information for Acquiring Fund dated _____________; (iii) the prospectus for Acquired Fund dated __________; (iv) the statement of additional information for Acquired Fund dated ___________; (v) the Notice of Special Meeting of Shareholders Scheduled for __________ and the accompanying proxy statement and prospectus on Form N-14; (vi) the Agreement; (vii) the tax representation certificates delivered pursuant to the Agreement and relevant to this opinion (the "Representation Certificates"); and (viii) such other documents as we deemed necessary or relevant to our analysis.
In our examination of documents, we have assumed, with your permission, the authenticity of original documents, the accuracy of copies, the genuineness of signatures, the legal capacity of signatories, and the proper execution of documents. We have further assumed, with your permission, that (i) all parties to the Agreement and to any other documents examined by us have acted, and will act, in accordance with the terms of such Agreement and documents and that the
[Pioneer Fund/Trust]
AmSouth Funds
__________, 2005
Transaction will be consummated pursuant to the terms and conditions set forth in the Agreement without the waiver or modification of any such terms and conditions; (ii) all representations contained in the Agreement, as well as those representations contained in the Representation Certificates are, on the date hereof, and will be, at the consummation of the Transaction and thereafter as relevant, true and complete; (iii) any representation made in any of the documents referred to herein "to the knowledge and belief" (or similar qualification) of any person or party is, and at the consummation of the Transaction will be, correct without such qualification; and (iv) as to all matters for which a person or entity has represented that such person is not a party to, does not have, or is not aware of any plan, intention, understanding, or agreement, there is no such plan, intention, understanding, or agreement. We have not attempted to verify independently any of the above assumptions or representations, but in the course of our representation, nothing has come to our attention that would cause us to question the accuracy thereof.
The conclusions expressed herein represent our judgment as to the proper treatment of the Transaction for United States federal income tax purposes based upon the relevant provisions of the Code, the Treasury Regulations promulgated thereunder, and interpretations of the foregoing as expressed in court decisions and administrative determinations, all as in effect on the date of this opinion. We cannot give any assurance that such laws will not be amended or otherwise changed after the consummation of the Transaction or that any such changes will not affect the conclusions expressed herein. We undertake no obligation to update or supplement this opinion to reflect any changes in law that may occur.
Our opinion represents our best judgment of how a court would decide if presented with the issues addressed herein and is not binding upon the Internal Revenue Service (the "IRS") or any court. Thus, no assurance can be given that a position taken in reliance on our opinion will not be challenged by the IRS or rejected by a court.
This opinion is limited to the specific United States federal income tax consequences of the Transaction set forth below. It does not address any other federal, state, local, or foreign income, estate, gift, transfer, sales, use, or other tax consequences that may result from the Transaction or any other transaction, including any transaction undertaken in connection with the Transaction. This opinion may not apply to certain classes of taxpayers, including without limitation shareholders who are not citizens or residents of the United States, insurance companies, tax-exempt organizations, financial institutions, dealers in securities or foreign currencies, or persons who hold their shares as part of a straddle or conversion transaction.
On the basis of and subject to the foregoing and in reliance upon the representations, facts and assumptions described above, we are of the opinion that the acquisition by Acquiring Fund of the assets of Acquired Fund solely in exchange for the issuance of Acquiring Fund Shares to Acquired Fund and the assumption of the Acquired Fund Liabilities by Acquiring Fund, followed by the distribution by Acquired Fund, in liquidation of Acquired Fund, of Acquiring Fund Shares to Acquired Fund shareholders in exchange for their Acquired Fund Shares and the termination of Acquired Fund, will constitute a "reorganization" within the meaning of Section 368(a) of the Code.
[Pioneer Fund/Trust]
AmSouth Funds
__________, 2005
As indicated above, our opinion is based solely on the documents that we have examined, including without limitation the Representation Certificates and the assumptions described herein. If any of the facts or representations contained in such documents is, or later becomes, inaccurate in any material respect, or if any of the assumptions we have made is, or later becomes, unfounded in any material respect, our opinion may be adversely affected and may not be relied upon.
This opinion is being delivered to you solely in connection with the closing condition set forth in Section 8.5 of the Agreement. This opinion is intended solely for the benefit of you and the shareholders of the Acquired Fund and it may not be relied upon for any other purpose or by any other person or entity, and may not be made available to any other person or entity, without our prior written consent.
Very truly yours,
WILMER CUTLER PICKERING
HALE AND DORR LLP
By: ______________________
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the references to our firm under the captions "Financial Highlights" and "Experts - Pioneer Funds", in the Combined Proxy Statement of AmSouth Funds and Prospectus for Pioneer Bond Fund ("Combined Proxy Statements and Prospectus"), and to the incorporation by reference of our report dated August 5, 2004, with respect to the financial statements and financial highlights of Pioneer Bond Fund, included in the Annual Report to the Shareowners for the year ended June 30, 2004, in the Combined Proxy Statements and Prospectus included in this Registration Statement on Form N-14 of the Pioneer Bond Fund. We further consent to the reference to us under the heading "Representations and Warranties" (paragraph 4.2(g)) in the Agreement and Plan of Reorganization included as Exhibit A to the Combined Proxy Statements and Prospectus.
We also consent to the references to our firm under the captions "Independent Registered Public Accounting Firm" and "Financial Statements" in the Pioneer Bond Fund Statement of Additional Information, and to the incorporation by reference of our report, dated August 5, 2004, on the financial statements and financial highlights of Pioneer Bond Fund included in the Annual Report to the Shareowners for the year ended June 30, 2004, in Post-Effective Amendment No. 40 to the Registration Statement (Form N-1A, 1933 No. 002-62436), as filed with the Securities and Exchange Commission on December 16, 2004 (Accession No. 0001016964-04-000519), which is incorporated by reference into the Combined Proxy Statements and Prospectus included in this Registration Statement on Form N-14 of the Pioneer Bond Fund.
/s/ ERNST & YOUNG LLP
Boston, Massachusetts
June 29, 2005
|
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the reference to our firm under the caption "Experts - AmSouth Funds", in the Combined Proxy Statement of AmSouth Funds and Prospectus for Pioneer Bond Fund ("Combined Proxy Statements and Prospectus"), and to the incorporation by reference of our report dated September 29, 2004, with respect to the financial statements and financial highlights of the AmSouth High Quality Bond Fund, included in the AmSouth Funds Annual Report for the year ended July 31, 2004, in the Combined Proxy Statements and Prospectus included in this Registration Statement on Form N-14 of the Pioneer Bond Fund. We further consent to the references to us under the heading "Representations and Warranties" (paragraph 4.1(f)) in the Agreement and Plan of Reorganization included as Exhibit A to the Combined Proxy Statements and Prospectus.
We also consent to the references to our firm under the captions "Independent Registered Public Accounting Firm" and "Financial Statements" in the AmSouth Funds Statement of Additional Information, and to the incorporation by reference of our report, dated September 29, 2004, on the financial statements and financial highlights of AmSouth High Quality Bond Fund included in the AmSouth Funds Annual Report for the year ended July 31, 2004, in Post-Effective Amendment No. 43 to the Registration Statement (Form N-1A, 1933 Nos. 33-21660) of the AmSouth Funds, as filed with the Securities and Exchange Commission on December 1, 2004 (Accession No. 0000898432-04-000999), which is incorporated by reference into the Combined Proxy Statements and Prospectus included in this Registration Statement on Form N-14 of the Pioneer Bond Fund.
/s/ ERNST & YOUNG LLP
Columbus, Ohio
June 29, 2005
|
AMSOUTH FUNDS
AMSOUTH HIGH QUALITY BOND FUND
SPECIAL MEETING OF SHAREHOLDERS - [ ], 2005
This proxy is solicited on behalf of the board of trustees of AmSouth Funds, on behalf of its series, AmSouth High Quality Bond Fund (the "AmSouth Fund"). The undersigned hereby appoints [ _________ ], [ ______ ] and [ ________ ], each of them (with full powers of substitution) to vote for the undersigned all shares of beneficial interest of the undersigned in the above-referenced AmSouth Fund at the Special Meeting of Shareholders to be held at [ : ] [a/p].m., [Eastern] time, on [ _________ ], 2005, at the offices of [ ], [ _________ ], and any adjournment thereof ("Meeting"), with all the power the undersigned would have if personally present.
The shares represented by this proxy will be voted as instructed on the reverse side. Unless instructions to the contrary are given on the reverse or if this proxy is executed but no instruction is given, this proxy shall be deemed to grant authority to vote "FOR" the proposal, with discretionary power to vote upon such other business as may properly come before the Meeting or any adjournment. The proxies intend to vote with management on any such other business properly brought before the Meeting. The undersigned hereby acknowledges receipt of the accompanying Notice of the Special Meeting and combined Proxy Statement and Prospectus.
Date [ ], 2005
YOUR VOTE IS VERY IMPORTANT. PLEASE
COMPLETE, SIGN, DATE AND RETURN THE
ENCLOSED PROXY CARD PROMPTLY.
NOTE: Please sign exactly as you
name or names appear. When signing
as attorney, executor,
administrator, trustee or guardian,
please give your full title as such.
If a corporation or partnership,
please sign in full corporate or
partnership name by an authorized
officer.
NOTE: YOUR PROXY CARD IS NOT VALID UNLESS IT IS SIGNED
YOUR VOTE IS IMPORTANT. PLEASE VOTE BY FILLING IN THE APPROPRIATE BOX BELOW. THIS PROXY WILL BE VOTED "FOR" THE PROPOSAL BELOW IF NO SPECIFICATION IS MADE BELOW.
Your board of trustees recommends that you vote "FOR" Proposal 1.
(1) To approve an Agreement and Plan of Reorganization.
FOR |_| AGAINST|_| ABSTAIN|_|
(2) To transact such other business as may properly come before the meeting.
We need your vote before [__________], 2005.
PLEASE SIGN AND DATE THE REVERSE SIDE.