FOR INTERNAL USE ONLY
QUESTIONS AND ANSWERS ABOUT PROPOSED CHANGES TO PIONEER INDO-ASIA FUND
A supplement to the prospectus for Pioneer Indo-Asia Fund dated June 1, 2001 was
mailed to shareholders of the Fund on June 8, 2001. The supplement is
accompanied by a cover letter from Theresa Hamacher. A Dealer Advisory is
mailing as well.
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Here are the major points covered in the shareholder communications:
THE FUND TRUSTEES APPROVED A TAX-FREE REORGANIZATION (SOMETIMES REFERRED TO AS A
"MERGER") OF THE FUND INTO PIONEER EMERGING MARKETS FUND PENDING APPROVAL OF
INDO-ASIA FUND SHAREHOLDERS LATER THIS SUMMER.
THE FUND WILL CLOSE TO NEW INVESTORS ON JUNE 29, 2001.
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Q: What is a tax-free reorganization?
A: If approved by the shareowners of Pioneer Indo-Asia Fund later this
summer, the assets of the fund would transfer to Pioneer Emerging Markets
Fund and shareowners of Pioneer Indo-Asia Fund would have their assets
converted into Pioneer Emerging Markets Fund shares. This is treated as a
non-taxable event.
Q: How will shareowners give their approval to this reorganization? When
would it become effective?
A: A proxy statement/prospectus will be mailed to shareowners in July. The
shareowner meeting is scheduled for mid-September 2001, with the
reorganization expected after the close of business on September 28, 2001.
Q: What are the differences in the investment policies of Pioneer Indo-Asia
Fund and Pioneer Emerging Markets Fund?
A: Pioneer Emerging Markets Fund takes a multi-regional approach to investing
in emerging markets, whereas Pioneer Indo-Asia Fund has a regional focus
within Asia/Pacific ex-Japan. However, the team employs the same
investment strategy in researching and managing these funds. Please refer
to the table below for comparisons between the two funds. You will receive
the proxy statement/prospectus later this summer, which contains greater
detail on investment policies and other issues.
The investment objectives and policies of Indo-Asia Fund and Emerging
Markets Fund are generally similar, as shown in the following table.
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PIONEER INDO-ASIA FUND PIONEER EMERGING MARKETS FUND
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Long-term growth of capital Long-term growth of capital
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Under normal circumstances, the fund invests at least Under normal circumstances, the fund invests at
65% of its total assets in equity securities of least 65% of its total assets in both equity and
Indo-Asian issuers. The fund's investments will debt securities of emerging market issuers. The
include securities of issuers in Australia and New fund normally emphasizes equity securities in its
Zealand but will exclude securities of issuers in portfolio.
Japan.
An emerging markets issuer:
An Indo-Asian issuer:
is organized under the laws of an emerging market
is organized under the laws of a country in Asia or country;
the Indian Subcontinent;
has a principal office in an emerging market
derives at least 50% of its revenues from business country; or
transacted, or has at least 50% of its assets, in
Asia or the Indian Subcontinent; or derives at least 50% of its gross revenues or
profits from goods or services produced in emerging
has equity securities that trade principally on a markets or sales made in emerging markets.
stock exchange (including an over-the-counter market)
in Asia or the Indian Subcontinent. The fund invests in at least six emerging markets.
The fund does not allocate more than 25% of its
total assets (at the time of purchase) to any one
country but can invest more than 25% of its total
assets in a particular region.
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The fund may invest up to 35% of its total assets (at The fund may invest up to 35% of its total assets
the time of purchase) in equity securities of (at the time of purchase) in equity and debt
companies located outside of Asia and the Indian securities of corporate or government issuers in
Subcontinent. any developed country (other than the U.S.) and
short-term debt securities for cash management
purposes.
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The fund may invest up to 25% of its total assets (at The fund may also invest in Brady bonds and debt
the time of purchase) in debt securities of corporate securities of any quality or maturity. The fund may
and government issuers. not invest more than 10% of its net assets in debt
securities rated below investment grade or in
unrated securities of comparable quality.
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The fund may invest up to 25% of its total assets The fund may also invest in Brady bonds and debt
(at the time of purchase) in debt securities of securities of any quality or maturity. The fund may
corporate and government issuers. not invest more than 10% of its net assets in debt
securities rated below investment grade or in
unrated securities of comparable quality.
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Q: Are the expenses for Pioneer Emerging Markets Fund different than those
for Pioneer Indo-Asia Fund?
A: Pioneer Emerging Markets Fund has a management fee of 1.25% versus Pioneer
Indo-Asia Fund's 1.10%. While Pioneer Emerging Markets Fund's management
fees are higher, the investment team conducts a larger research effort in
analyzing and managing these investments. Additionally, please refer to
the table below or the prospectus supplement for expense ratio
comparisons.
FUND EXPENSE RATIOS
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NAME OF FUND EXPENSE RATIO
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Class A Class B Class C
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Indo-Asia Fund (gross expenses) 2.61%* 3.41%* 3.39%*
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Indo-Asia Fund (net of expense limitation) 2.10%* 2.95%* 2.89%*
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Emerging Markets Fund 2.19% 3.05% 2.85%
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*Pioneer has agreed not to impose during Indo-Asia Fund's current fiscal
year all or a portion of its management fee and, if necessary, to limit
other ordinary operating expense to the extent required to reduce Class A
expenses to 2.10% of the daily net assets attributable to Class A shares.
The portion of the expenses attributable to Class B and Class C shares will
be reduced only to the extent such expenses are reduced for Class A shares.
Pioneer may amend or eliminate this expense limitation agreement at the end
of any fiscal year.
Q: If I own Class B shares in Pioneer Indo-Asia Fund will my contingent
deferred sales charge (CDSC) schedule remain the same for Pioneer Emerging
Markets Fund?
A: Yes, Pioneer Emerging Markets Fund has the same CDSC schedule as Pioneer
Indo-Asia Fund. Please refer to the Pioneer Emerging Markets Fund CDSC
schedule within the table below.
CDSC SCHEDULE
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ON SHARES SOLD BEFORE THE AS A % OF
END OF YEAR DOLLAR AMOUNT SUBJECT TO
THE SALES CHARGE
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1 4
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2 4
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3 3
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4 3
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5 2
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6 1
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7+ -0-
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Q: Do I need to take any action now?
A: No - shareowners are not being asked to do anything with regards to the
proposed reorganization at this time. You will be receiving a proxy in
July and we would ask that you vote your proxy when you receive it as a
timely response will save your fund the need to do additional mailings
throughout the summer. We do encourage investors to talk with their
investment professional if you have questions. If you wish to exchange
your Pioneer Indo-Asia Fund account to another Pioneer fund, you may do
this at any time. Please keep in mind that exchanges for non-retirement
accounts will have tax implications. Again, talk with your investment
professional before making your decision.
(C) Pioneer Funds Distributor, Inc.
Underwriter of Pioneer Mutual Funds
60 State Street
Boston, MA 02109