SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss.240.14a-12
Pioneer Independence Fund
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
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PRELIMINARY PROXY MATERIAL
PIONEER INDEPENDENCE FUND
60 State Street
Boston, Massachusetts 02109
1-800-225-6292
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
SCHEDULED FOR AUGUST ___, 2000
This is the formal agenda for your fund's special shareholder meeting.
It tells you the matters you will be asked to vote on and the time and place of
the meeting, in case you want to attend in person.
To the shareholders of Pioneer Independence Fund:
A special meeting of shareholders of your fund will be held at the
offices of Hale and Dorr LLP, 60 State Street, 26th Floor, Boston, Massachusetts
on August ___, 2000 at 2:00 p.m., Boston time, to consider the following:
1. A proposal to approve a new management contract between the fund and
Pioneer Investment Management, Inc., your fund's investment adviser
("Pioneer"). This new contract will take effect only if the proposed
acquisition of The Pioneer Group, Inc. ("PGI"), the parent of Pioneer, by
UniCredito Italiano S.p.A. ("UniCredito") is consummated;
2. To elect the eight trustees of the fund, as named in the attached proxy
statement, to serve on the board of trustees until their successors have
been duly elected and qualified; and
3. To consider any other business that may properly come before the meeting.
To the investors ("plan owners") of Pioneer Independence Plans
("plans"):
You are being asked to vote on the proposals listed above on the
enclosed voting instructions card. Your vote will instruct the plans' custodian
how to vote fund shares in your plan at the special meeting of the shareholders.
YOUR TRUSTEES RECOMMEND THAT YOU VOTE IN FAVOR OF ALL THE PROPOSALS. APPROVAL OF
A NEW MANAGEMENT CONTRACT IS REQUIRED BECAUSE OF THE CHANGE IN CONTROL OF PGI.
THERE ARE NO MATERIAL DIFFERENCES BETWEEN THE EXISTING MANAGEMENT CONTRACT AND
THE PROPOSED MANAGEMENT CONTRACT. APPROVAL OF PROPOSAL 1, WILL NOT INCREASE THE
MANAGEMENT FEE RATE PAYABLE BY THE FUND.
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Shareholders of record as of the close of business on June 16, 2000 are
entitled to vote at the meeting and any related follow-up meetings.
By Order of the Board of Trustees,
Joseph P. Barri, SECRETARY
Boston, Massachusetts
June ______, 2000
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE AND RETURN THE
ENCLOSED PROXY.
8613-00-0600
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PROXY STATEMENT
OF
PIONEER INDEPENDENCE FUND
60 State Street
Boston, Massachusetts 02109
1-800-225-6292
SPECIAL MEETING OF SHAREHOLDERS
This proxy statement contains the information you should know before
voting on the proposals summarized below.
THE FUND WILL FURNISH WITHOUT CHARGE A COPY OF ITS MOST RECENT ANNUAL
REPORT AND ANY MORE RECENT SEMIANNUAL REPORT TO ANY SHAREHOLDER OR PLAN OWNER
UPON REQUEST. IF YOU WANT TO OBTAIN A COPY OF THE FUND'S REPORTS, CONTACT YOUR
INVESTMENT DEALER, SEND A REQUEST TO BOSTON FINANCIAL DATA SERVICES, P.O. BOX
8300, BOSTON, MASSACHUSETTS 02266-8300 OR CALL 1-800-765-9565 WEEKDAYS BETWEEN 8
A.M. TO 6 P.M. EASTERN TIME.
INTRODUCTION
This proxy statement is being used by the board of trustees of your
fund to solicit proxies to be voted at a special meeting of shareholders of your
fund. The fund's special meeting will be held at the offices of Hale and Dorr
LLP, 60 State Street, 26th Floor, Boston, Massachusetts 02109 at 2:00 p.m.,
Boston time, on August ___, 2000, and at any adjournments of the meeting to a
later date, for the purposes as set forth in the accompanying notice of special
meeting of shareholders.
This proxy statement and the enclosed proxy card are being mailed to
shareholders on or about June __, 2000. The annual report for the fund for its
most recently completed fiscal year was previously mailed to shareholders.
The special shareholder meeting is being called to consider, among
other things, proposals related to the proposed acquisition (the "Transaction")
of all of the outstanding shares of The Pioneer Group, Inc. ("PGI"), the parent
company of the fund's investment adviser, Pioneer Investment Management, Inc.
("Pioneer"), by UniCredito Italiano S.p.A. ("UniCredito"). If Proposal 1,
regarding the approval of the proposed management contract (as defined below),
is adopted and the Transaction is consummated, Pioneer will continue as the
investment adviser to the fund. The Transaction is conditioned upon approval of
Proposal 1 by shareholders of the fund and approval of similar proposals by
shareholders of other funds in the Pioneer Family of Funds, together
representing at least 92.5% of the aggregate assets in the Pioneer Family of
Funds. The Transaction and the terms of the proposed management contract are
discussed below.
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WHO IS ELIGIBLE TO VOTE
IF YOU HOLD SHARES OF THE FUND DIRECTLY:
Shareholders of record of the fund as of the close of business on June
16, 2000 (the "record date") are entitled to vote on all of the fund's business
at the special shareholder meeting and any adjournments thereof. 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 in favor of each of the nominees for trustee and to approve the other
proposals. If any other business comes before the special shareholder meeting,
your shares will be voted at the discretion of the persons named as proxies.
IF YOU ARE A PLAN OWNER:
Pioneer Independence Plans is the record owner of the fund shares in
your plan. By completing and returning the enclosed voting instructions card,
you will instruct the plans' custodian how to vote the fund shares in your plan.
THE TRANSACTION
INFORMATION CONCERNING UNICREDITO
UniCredito is a corporation organized under the laws of the Republic of
Italy, and its shares trade on the Milan Stock Exchange. UniCredito is Italy's
second largest banking group, as measured by market capitalization, and was
formed in 1998 by the merger of Credito Italiano and Rolo Banca 1473 with
Cariverona, Cassa di Risparmio di Torino and Cassamarca. Through approximately
3,600 branches worldwide, UniCredito offers a range of services relating to,
among other things, banking, life and property/casualty insurance and equipment
leasing.
UniCredito's asset management subsidiary, EuroPlus, is one of Europe's
largest and fastest-growing asset managers, with approximately $80 billion in
assets under management, 90 established mutual funds and 13 new funds ready to
be launched. EuroPlus currently serves approximately 200 institutional clients
and over 5,000 high net worth clients. Its share of the retail and institutional
markets in Italy and Europe makes EuroPlus the largest institutional account
manager in Italy, the third largest mutual fund manager in Italy and the fifth
largest mutual fund manager in Europe. EuroPlus operates primarily through two
arms: EuroPlus Research and Management in Dublin and EuroPlus SGR in Milan.
Upon completion of the Transaction, PGI and EuroPlus will combine to
form Pioneer Global Asset Management, a new wholly owned subsidiary of
UniCredito with combined assets under management of over $100 billion. Pioneer
Global Asset Management will conduct its asset management business through three
operational units: Pioneer Research & Management (currently EuroPlus Research
and Management), Pioneer SGR (currently EuroPlus SGR) and Pioneer U.S.
(currently PGI).
The principal executive offices of UniCredito are located at Piazza
Cordusio 2, 20123 Milan, Italy.
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THE TERMS OF THE MERGER AGREEMENT
At the closing of the Transaction, UniCredito will acquire, by merging
a wholly owned subsidiary into PGI, all the issued and outstanding shares of
common stock of PGI for an aggregate merger consideration of approximately $1.2
billion or $43.50 per share. Immediately prior to the effective time of the
Transaction, PGI will also distribute to its stockholders all of the shares of a
newly formed company that will conduct, after the effective date of the merger,
PGI's gold exploration, timber, Russian investment management and Eastern
European real estate and venture capital businesses. The merger consideration is
not subject to adjustment, and there is no financing condition to the
consummation of the Transaction. Messrs. John F. Cogan, Jr. and David D.
Tripple, trustees of the fund and executive officers of PGI and Pioneer, will
receive a portion of the merger consideration in exchange for their shares of
PGI, and Mr. Cogan will also receive a bonus payment of $1 million upon
consummation of the Transaction. Mr. Cogan is expected to become the Deputy
Chairman of Pioneer Global Asset Management and non-executive Chairman of
Pioneer U.S. Mr. Tripple is expected to be Chief Executive Officer of Pioneer
U.S.
The Transaction is expected to close during the third quarter of 2000,
provided that a number of conditions set forth in the merger agreement, dated as
of May 14, 2000, between PGI and UniCredito (the "Merger Agreement"), are met or
waived. These conditions include the approval of the Merger Agreement by PGI's
stockholders, the approval of a new management contract by shareholders of the
fund and approval of similar new management contracts by shareholders of other
funds in the Pioneer Family of Funds, together representing at least 92.5% of
the aggregate assets in the Pioneer Family of Funds, and obtaining certain
regulatory approvals.
No change in the fund's portfolio management team is anticipated to
occur in connection with the Transaction. PGI has agreed to provide bonus
payments and other benefits to certain Pioneer personnel in order that there is
no disruption in the quality of services provided to shareholders of the fund in
connection with the Transaction. However, the Transaction is not conditioned
upon the continued employment of any Pioneer personnel, and there can be no
assurance that any particular Pioneer employee will choose to remain employed by
UniCredito or its affiliates.
ANTICIPATED BENEFITS OF THE TRANSACTION
Pioneer anticipates that the Transaction and its affiliation with
UniCredito will benefit Pioneer and the fund in a number of ways, including the
following:
o Pioneer's expertise will be enhanced by the experience and expertise of
UniCredito's investment management professionals. While no change in the
management of the fund is currently planned, Pioneer will be able to draw
upon the expertise of UniCredito's team of professionals to strengthen
Pioneer's portfolio management capabilities.
o The combination will provide additional opportunities for Pioneer's
personnel and provide the security of being part of a larger, financially
stronger company.
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This development should further Pioneer's ability to attract and retain
highly qualified staff members.
o UniCredito has made the growth of its asset management operations a key
component of its business plans. This commitment should assist Pioneer in
continuing to expand its business, attract more assets to the fund and
maintain the high level of services it provides to the fund.
PROPOSAL 1
APPROVAL OF A NEW MANAGEMENT CONTRACT
SUMMARY
Pioneer has served as the fund's investment adviser since the fund's
inception.
Pioneer serves as the investment adviser for each fund in the Pioneer
Family of Funds and for other institutional accounts. Pioneer, a registered
investment adviser under the Investment Advisers Act of 1940, as amended, is a
wholly owned subsidiary of PGI. Both Pioneer and PGI are located at 60 State
Street, Boston, Massachusetts 02109.
At meetings of the board of trustees for the fund held on May 25, 2000
and June ___, 2000, the trustees, including all of the trustees who are not
"interested persons" of the fund, Pioneer or UniCredito, unanimously approved as
in the best interest of shareholders, and voted to recommend that the
shareholders of the fund approve, a proposal to adopt a new management contract
with Pioneer (the "proposed management contract") effective upon consummation of
the Transaction.
Shareholders of the fund are being asked to approve the fund's proposed
management contract with Pioneer. The consummation of the Transaction will
constitute an "assignment" (as defined in the Investment Company Act of 1940
(the "1940 Act")) of the fund's current management contract with Pioneer (the
"existing management contract"). As required by the 1940 Act, the existing
management contract provides for its automatic termination in the event of an
assignment. Accordingly, the existing management contract will terminate upon
the consummation of the Transaction and the new management contract is being
proposed to enable Pioneer to continue to manage the fund.
TERMS OF THE PROPOSED MANAGEMENT CONTRACT AND EXISTING MANAGEMENT CONTRACT
The terms of the fund's proposed management contract are substantially
identical to the terms of the fund's existing management contract, except for
the dates of execution, effectiveness and termination. The stated management fee
to be paid by the fund is identical under the proposed management contract and
the existing management contract. All the terms described below with respect to
the fund's proposed management contract were contained in the fund's existing
management contract. The following summary of the proposed management contract
is qualified by reference to the form of proposed management contract attached
to this proxy statement as EXHIBIT A. Information regarding Pioneer, its
principal executive officer and directors and brokerage policy is included in
EXHIBIT B to this proxy statement.
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MANAGEMENT SERVICES. The management services to be provided by Pioneer
to the fund under the proposed management contract are identical to those
provided by Pioneer under the fund's existing management contract. Pursuant to
the terms of the existing management contract, Pioneer serves as investment
adviser to the fund and is responsible for the overall management of the fund's
business affairs subject only to the authority of the board of trustees. Pioneer
is authorized to buy and sell securities for the account of the fund and to
designate brokers to carry out such transactions. Pioneer may not make any
purchase the cost of which exceeds the fund's available liquid assets and may
not make any purchase which would violate any fundamental policy or restriction
in the fund's prospectus or statement of additional information as in effect
from time to time.
PAYMENT OF EXPENSE AND TRANSACTION CHARGES. The proposed management
contract and the existing management contract for the fund will contain
identical provisions relating to the expenses to be borne by the fund. The
fund's existing management contract and proposed management contract provide
that the expenses borne by the fund will include: (i) the charges and expenses
for fund accounting, pricing and appraisal services and related overhead,
including, to the extent such services are performed by personnel of Pioneer or
its affiliates, office space and facilities and personnel compensation, training
and benefits; (ii) the charges and expenses of auditors; (iii) the charges and
expenses of any custodian, transfer agent, plan agent, dividend disbursing agent
and registrar appointed by the fund; (iv) issue and transfer taxes chargeable to
the fund in connection with securities transactions to which the fund is a
party; (v) insurance premiums, interest charges, dues and fees for membership in
trade associations and all taxes and corporate fees payable by the fund to
federal, state or other governmental agencies; (vi) fees and expenses involved
in registering and maintaining registrations of the fund and/or its shares with
federal regulatory agencies, state or blue sky securities agencies and foreign
jurisdictions, including the preparation of prospectuses and statements of
additional information for filing with such regulatory authorities; (vii) all
expenses of shareholders' and trustees' meetings and of preparing, printing and
distributing prospectuses, notices, proxy statements and all reports to
shareholders and to governmental agencies; (viii) charges and expenses of legal
counsel to the fund and the trustees; (ix) any distribution fees paid by the
fund in accordance with Rule 12b-1 under the 1940 Act; (x) compensation of those
trustees of the fund who are not affiliated with, or "interested persons" of,
Pioneer, the fund (other than as trustees), PGI or Pioneer Funds Distributor,
Inc. ("PFD"); (xi) the cost of preparing and printing share certificates; and
(xii) interest on borrowed money, if any.
Under both the existing and the proposed management contracts for the
fund, Pioneer, at its own expense, will furnish to the fund office space in its
offices or in such other place as may be agreed upon from time to time, and all
necessary office facilities, equipment and personnel for managing the affairs
and investments and supervising the keeping of the books of the fund and shall
arrange, if desired by the fund, for members of Pioneer's organization to serve
as officers or agents of the fund.
Also, under both the existing and proposed management contracts for the
fund, Pioneer will pay directly or reimburse the fund for: (i) compensation (if
any) of the trustees who are affiliated with, or "interested persons" (as
defined in the 1940 Act) of, Pioneer and all officers of the fund as such; and
(ii) all expenses not specifically assumed by the fund where such expenses
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are incurred by Pioneer or by the fund in connection with the management of
the affairs of, and the investment and reinvestment of the assets of, the fund.
The fund has also entered into an administration agreement with Pioneer
pursuant to which the fund authorizes Pioneer to provide certain fund accounting
services and legal services that Pioneer is not required to provide under the
existing management contract. Under the administration agreement, Pioneer is
reimbursed for its allocable portion of its direct costs of such services. The
allocable portion of such costs is based upon the time worked by Pioneer's
employees rendering such services for the fund as a percentage of the total
hours worked by such employees. Pioneer's direct costs include any out-of-pocket
expenses incurred by Pioneer in rendering such services, an allocable portion of
the salaries and benefits of the employees rendering such services and a
reasonable allocation of overhead. Annual allocation and reimbursement of these
expenses is subject to annual approval of the fund's independent trustees.
MANAGEMENT FEES. For its services, Pioneer is entitled to a management
fee. The method and rate for calculating the fund's management fee will be the
same under the fund's proposed management contract as under its existing
management contract (such methods and rates are set forth below). If the
proposed management contract had been in effect for the fund's most recently
completed fiscal year, the amount of management fees payable to Pioneer by the
fund would have been identical to those payable under the existing management
contract. THERE WILL BE NO INCREASE IN THE MANAGEMENT FEE RATE IN CONNECTION
WITH THE TRANSACTION.
The fund pays Pioneer a management fee at a rate equal to 0.75% per
annum of the fund's average daily net assets. The fee is calculated and accrued
daily and paid monthly in arrears. Because of a voluntary expense limitation
currently in effect, the fund did not pay any management fees to Pioneer for the
fund's most recently completed fiscal year ended December 31, 1999 or for the 12
months ended March 31, 2000. Absent the expense limitation, the fund would have
paid Pioneer $53,227 and $71,706 respectively. The existing management contract
was initially approved by shareholders on March 11, 1998.
OTHER PROVISIONS UNDER THE EXISTING AND PROPOSED MANAGEMENT CONTRACTS
STANDARD OF CARE. Under the existing and proposed management contracts,
Pioneer "will not be liable for any error of judgment or mistake of law or for
any loss sustained by reason of the adoption of any investment policy or the
purchase, sale, or retention of any security on the recommendation of [Pioneer].
. .." Pioneer, however, shall not be protected against liability by reason of
its ". . . willful misfeasance, bad faith or gross negligence in the performance
of its duties or by reason of its reckless disregard of its obligations and
duties under" either the existing or proposed management contract.
PIONEER'S AUTHORITY. The existing and proposed management contracts
provide that Pioneer shall have full discretion to act for the fund in
connection with the purchase and sale of portfolio securities subject only to
the declaration of trust, bylaws, currently effective registrations under the
1940 Act and the Securities Act of 1933, as amended, investment objective,
policies and restrictions of the fund in effect from time to time, and specific
policies and instructions established from time to time by the trustees.
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PORTFOLIO TRADING. The existing and proposed management contracts
expressly permit Pioneer to engage in portfolio trading. For a more detailed
description of Pioneer's current portfolio brokerage practices, see EXHIBIT B to
this proxy statement.
EXPENSE LIMITATION. The existing and proposed management contracts
provide that Pioneer may from time to time agree not to impose all or a portion
of its fee or otherwise take action to reduce expenses of the fund. Except as
may otherwise be agreed to by Pioneer, any such fee limitation or expense
reduction is voluntary and may be discontinued or modified by Pioneer at any
time. The existing and proposed management contracts for the fund also contain a
provision which limits the fund's operating expenses to the highest limit set by
state securities law. The proposed management contract for the fund will be
revised to eliminate this provision because it is no longer necessary under
federal securities laws.
OTHER PROVISIONS. The existing and proposed management contracts for
the fund contain a provision which permits Pioneer to delegate its investment
advisory duties to a subadviser. Any use of subadvisers would be subject to
approval by the fund's independent trustees. The existing and proposed
management contracts for the fund contain a provision which prohibits the fund
from using the name "Pioneer" in the event Pioneer or any of its affiliates
ceases to act as the investment adviser of the fund.
Each existing and proposed management contract includes provisions that
provide that: (i) the law of The Commonwealth of Massachusetts shall be the
governing law of the contract; (ii) Pioneer is an independent contractor and not
an employee of the fund; (iii) the contract is the entire agreement between the
parties with respect to the matters described therein; (iv) the contract may be
executed using counterpart signature pages; and (v) invalid or unenforceable
provisions of the contract are severable and do not render the entire agreement
invalid or unenforceable.
MISCELLANEOUS
If approved by shareholders, the fund's proposed management contract
will become effective upon the consummation of the Transaction and will continue
in effect for an initial period of [two years] and thereafter will continue from
year to year subject to annual approval by the board of trustees in the same
manner as the existing management contract. The fund's proposed management
contract terminates if assigned (as defined in the 1940 Act) and may be
terminated without penalty by either party, by vote of its board or by a vote of
a majority of the outstanding voting securities of the fund and upon 60 days'
written notice.
ADDITIONAL INFORMATION PERTAINING TO PIONEER
For additional information concerning the management, ownership
structure, affiliations, brokerage policies and certain other matters pertaining
to Pioneer, see EXHIBIT B.
FACTORS CONSIDERED BY THE TRUSTEES
The trustees of the fund determined that the terms of the proposed
management contract are fair and reasonable and that approval of the
proposed management contract on behalf of the fund is in the best interests of
the fund. The trustees also determined that the continuity and
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efficiency of management services after the consummation of the Transaction
can best be assured by approving the proposed management contract on behalf of
the fund. The trustees believe that the proposed management contract will enable
the fund to continue to enjoy high quality investment advisory services at costs
which they deem appropriate, reasonable and in the best interests of the fund
and its shareholders.
In evaluating the proposed management contract, the trustees reviewed
materials furnished by Pioneer and UniCredito, including information regarding
Pioneer, UniCredito, their respective affiliates and their personnel, operations
and financial condition. The trustees also reviewed the terms of the Transaction
and its possible effects on the fund and its shareholders. Representatives of
Pioneer discussed with the trustees the anticipated effects of the Transaction
and, together with a representative of UniCredito, indicated their belief that
as a consequence of the proposed transaction, the operations of the fund and the
capabilities of Pioneer to provide advisory and other services to the fund would
not be adversely affected and should be enhanced by the resources of UniCredito,
though there could be no assurance as to any particular benefits that may
result. The trustees also reviewed information regarding the investment
performance of the fund on an absolute basis and compared to investment
companies with similar investment objectives and policies (the "peer group"),
the fees and expenses incurred by the fund compared to its peer group and the
profitability to Pioneer in managing the fund.
The trustees also specifically considered the following as relevant to
their recommendations: (1) that the terms of the proposed management contract
are substantially identical to those of the existing management contract, except
for a different execution date, effective date, termination date and a
non-material change; (2) the favorable history, reputation, qualification and
background of Pioneer and UniCredito, as well as the qualifications of their
personnel and their respective financial conditions; (3) that the fee and
expense ratios of the fund are reasonable given the quality of services expected
to be provided and are comparable to the fee and expense ratios of similar
mutual funds; (4) the relative performance of the fund since commencement of
operations to comparable mutual funds and unmanaged indices; (5) the commitment
of PGI to pay the expenses of the fund in connection with the Transaction so
that shareholders of the fund would not have to bear such expenses; (6) the
possibility of benefits that may be realized by the fund as a result of
Pioneer's affiliation with UniCredito, including any resources of UniCredito
that would be available to Pioneer; (7) the Transaction ensures continuity of
management of the fund and reduces vulnerability to changes in control of PGI
that may be adverse to the fund's interests; and (8) other factors deemed
relevant by the trustees. The trustees deemed the factors set forth in clauses
(1), (2), (3) and (7) to be particularly persuasive in their decision to
recommend to the fund's shareholders that they approve the proposed management
contract. The trustees considered the other factors set forth above to be
relevant to a lesser extent than those set forth in clauses (1), (2), (3) and
(7). The trustees did not attach a weighting to any particular factor.
SECTION 15(F) OF THE 1940 ACT
Section 15(f) of the 1940 Act permits, in the context of a change in
control of an investment adviser to a registered investment company, the receipt
by such investment adviser (or any of its affiliated persons) of any amount or
benefit in connection with such sale, as long as two conditions are satisfied.
First, there may not be imposed an "unfair burden" on the
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investment company as a result of the sale of such interest, or any express
or implied terms, conditions or understandings applicable thereto. The term
"unfair burden," as defined in the 1940 Act, includes any arrangement during the
two-year period after the transaction whereby the investment adviser (or
predecessor or successor adviser), or any interested person of any such adviser,
receives or is entitled to receive any compensation, directly or indirectly,
from the investment company or its security holders (other than fees for bona
fide investment advisory or other services), or from any person in connection
with the purchase or sale of securities or other property to, from or on behalf
of the investment company (other than ordinary fees for bona fide principal
underwriting services).
The board of trustees has not been advised by Pioneer of any
circumstances arising from the Transaction that might result in the imposition
of an "unfair burden" being imposed on the fund. Moreover, UniCredito has agreed
in the Merger Agreement that (i) for a period of three years after the
consummation of the Transaction, UniCredito and its affiliates will use
reasonable efforts to assure that at least 75% of the fund's board of trustees
are not "interested persons" (as defined in the 1940 Act) of UniCredito or
Pioneer, (ii) for two years after the consummation of the Transaction,
UniCredito and its affiliates will refrain from imposing, or agreeing to impose,
an unfair burden on the fund and (iii) UniCredito and its affiliates will use
reasonable efforts to ensure that any vacancy on the fund's board of trustees
shall be filled by a person who is not an "interested person" of UniCredito or
Pioneer and who has been selected by the fund's independent trustees.
TRUSTEES' RECOMMENDATION
The independent trustees of the fund held meetings to consider the
proposed management contract and the Transaction on May 25, 2000 and June ___,
2000, and the entire board of trustees considered the proposal at a meeting held
on June ___, 2000. Based on their evaluation of the materials presented and
assisted by the advice of independent counsel, the trustees at the meeting held
on June ___, 2000, including all the trustees who are not "interested persons"
of the fund, Pioneer or UniCredito, unanimously concluded that the terms of the
proposed management contract for the fund are reasonable, fair and in the best
interests of the fund and its shareholders, and that the fees provided therein
are fair and reasonable in light of the usual and customary charges made by
others for services of the same nature and quality. The trustees, by a vote cast
at the meeting, approved and voted to recommend to the shareholders of the fund
that they approve the proposed management contract.
If the shareholders of the fund do not approve the proposed management
contract and the Transaction is consummated, the trustees of the fund would
consider what further action to take consistent with their fiduciary duties to
the fund. Such actions may include obtaining for the fund interim investment
advisory services at cost or at the current fee rate either from Pioneer or from
another advisory organization. Thereafter, the trustees of the fund would either
negotiate a new investment advisory agreement with an advisory organization
selected by the trustees or make other appropriate arrangements. In the event
the Transaction is not consummated, Pioneer would continue to serve as
investment adviser of the fund pursuant to the terms of the existing management
contract.
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REQUIRED VOTE
As provided under the 1940 Act, approval of the proposed management
contract will require the vote of a majority of the outstanding voting
securities of the fund. In accordance with the 1940 Act and as used in this
Proposal 1, a "majority of the outstanding voting securities" of the fund means
the lesser of (1) 67% or more of the shares of the fund present at a shareholder
meeting if the owners of more than 50% of the shares of the fund then
outstanding are present in person or by proxy, or (2) more than 50% of the
outstanding shares of the fund entitled to vote at the shareholder meeting.
However, in addition to the legal requirement under the 1940 Act, the
consummation of the Transaction is conditioned upon the approval of the proposed
management contract by shareholders of the fund and approval of similar new
management contracts by shareholders of other funds in the Pioneer Family of
Funds, together representing at least 92.5% of the aggregate assets in the
Pioneer Family of Funds.
FOR THE REASONS SET FORTH ABOVE, THE TRUSTEES OF YOUR FUND UNANIMOUSLY
RECOMMEND THAT SHAREHOLDERS VOTE IN FAVOR OF THE PROPOSED MANAGEMENT CONTRACT.
PROPOSAL 2
ELECTION OF BOARD OF TRUSTEES
Shareholders of the fund are being asked to consider the election of
eight nominees to the board of trustees of the fund. All of the nominees for
election to the fund's board currently serve as trustees for the fund. Each
trustee will be elected to hold office until the next meeting of shareholders or
until his or her successor is elected and qualified. Each nominee has consented
to being named in this proxy statement and indicated his or her willingness to
serve if elected. If any nominee should be unable to serve, an event which is
not anticipated, the persons named as proxies may vote for such other person as
shall be designated by the fund's board of trustees. The persons named on the
accompanying proxy card intend to vote at the meeting (unless otherwise
directed) for the election of the nominees named below as trustees of the fund.
The following table sets forth each nominee's position(s) with the
fund, and his or her age, address, principal occupation and employment during
the past five years and any other directorship held. The table also indicates
the year during which he or she first became a trustee of the fund and the
number of shares of the fund beneficially owned by each nominee, directly or
indirectly, on May 31, 2000.
10
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF SHARES
OWNED AND
PERCENTAGE OF
PRINCIPAL OCCUPATION FIRST TOTAL SHARES
NAME (AGE), POSITION(S) WITH OR EMPLOYMENT BECAME A OUTSTANDING ON MAY
THE FUND AND ADDRESS AND TRUSTEE/DIRECTORSHIPS TRUSTEE 31, 2000+
-------------------- ------------------------- ------- --------
<S> <C> <C> <C>
JOHN F. COGAN, JR.* (74) President, Chief Executive Officer and a 1997
CHAIRMAN OF THE BOARD, PRESIDENT Director of PGI; Chairman and a Director of
AND TRUSTEE Pioneer, PFD, Closed Joint-Stock Company
60 State Street "Forest-Starma" and Pioneer Global Funds
Boston, MA 02109 Distributor, Ltd.; Director of Pioneer Real
Estate Advisors, Inc. ("PREA"), Pioneer
Forest, Inc., Pioneer Management (Ireland)
Limited ("PMIL"), Pioneer First Investment
Fund and PIOGlobal Corporation
("PIOGlobal"); President and Director of
Pioneer International Corporation ("PIntl"),
Pioneer First Russia, Inc. ("PFR") and
Pioneer Omega, Inc. ("Pioneer Omega");
Member of the Supervisory Board of Pioneer
Fonds Marketing GmbH, Pioneer First Polish
Investment Fund Joint Stock Company
("Pioneer First Polish"), Pioneer Czech
Investment Company, a.s. ("Pioneer Czech")
and Pioneer Universal Pension Fund Company;
Chairman, President and Trustee of all of
the Pioneer mutual funds; Director of
Pioneer America Fund Plc, Pioneer
Diversified Income Fund Plc, Pioneer Global
Equity Fund Plc, Pioneer Global Bond Fund
Plc, Pioneer Euro Reserve Fund Plc, Pioneer
European Equity Fund Plc, Pioneer Emerging
Europe Fund Plc, Pioneer Greater Asia Fund
Plc, Pioneer U.S. Growth Fund Plc and
Pioneer US Real Estate Fund Plc,
(collectively, the "Irish Funds"); and Of
Counsel, Hale and Dorr LLP (counsel to PGI
and the fund).
11
<PAGE>
<CAPTION>
NUMBER OF SHARES
OWNED AND
PERCENTAGE OF
PRINCIPAL OCCUPATION FIRST TOTAL SHARES
NAME (AGE), POSITION(S) WITH OR EMPLOYMENT BECAME A OUTSTANDING ON MAY
THE FUND AND ADDRESS AND TRUSTEE/DIRECTORSHIPS TRUSTEE 31, 2000+
-------------------- ------------------------- ------- --------
<S> <C> <C> <C>
MARY K. BUSH President, Bush & Co. (international financ- 1997 0.00(0%)
(52) ing advisory firm); Director and/or Trustee
TRUSTEE of Mortgage Guaranty Insurance Corporation,
4201 Cathedral Ave. Hoover Institution, March of Dimes,
NW Wilberforce University, Texaco, Inc., Build-
Washington, DC 20016 ing One Services Corporation and R.J.
Reynolds Tobacco Holdings, Inc.; Advisory
Board Member, Washington Mutual Investors
Fund (registered investment company); and
Trustee of all of the Pioneer mutual funds,
except Pioneer Variable Contracts Trust.
RICHARD H. EGDAHL, M.D. Alexander Graham Bell Professor of Health 1998 0.00(0%)
(73) Care Entrepreneurship, Boston University;
TRUSTEE Professor of Management, Boston University
Boston University Health Policy School of Management; Professor of Public
Institute Health, Boston University School of Public
53 Bay State Road Health; Professor of Surgery, Boston Univer-
Boston, MA 02215 sity School of Medicine; University
Professor, Boston University; Director,
Boston University Health Policy Institute,
University Program for Health Care
Entrepreneurship; Trustee, Boston Medical
Center; and Trustee of all of the Pioneer
mutual funds.
MARGARET B.W. GRAHAM Founding Director, The Winthrop Group, Inc. 1998 0.00(0%)
(53) (consulting firm); and Trustee of all of the
TRUSTEE Pioneer mutual funds, except Pioneer
The Keep Variable Contracts Trust.
P.O. Box 110
Little Deer Isle, ME
04650
MARGUERITE A. PIRET President, Newbury, Piret & Company, Inc. 1998 0.00(0%)
(52) (merchant banking firm); Trustee of Boston
TRUSTEE Medical Center; Member of the Board of
One Boston Place Governors of the Investment Company Insti-
26th Floor tute; Director, Organogenesis Inc. (tissue
Boston, MA 02108 engineering company); and Trustee of all of
the Pioneer mutual funds.
12
<PAGE>
<CAPTION>
NUMBER OF SHARES
OWNED AND
PERCENTAGE OF
PRINCIPAL OCCUPATION FIRST TOTAL SHARES
NAME (AGE), POSITION(S) WITH OR EMPLOYMENT BECAME A OUTSTANDING ON MAY
THE FUND AND ADDRESS AND TRUSTEE/DIRECTORSHIPS TRUSTEE 31, 2000+
-------------------- ------------------------- ------- --------
<S> <C> <C> <C>
DAVID D. TRIPPLE* Executive Vice President and a Director of 1998 0.00(0%)
(56) PGI; President and a Director of Pioneer and
EXECUTIVE VICE PRESIDENT AND of PFD; Director of Pioneering Services
TRUSTEE Corporation ( "PSC" ), PIntl, PIOGlobal,
60 State Street Pioneer Omega, PMIL and the Irish Funds;
Boston, MA 02109 Member of the Supervisory Board of Pioneer
First Polish, Pioneer Czech and Pioneer
Asset Management, S.A.; and Executive Vice
President and Trustee of all of the Pioneer
mutual funds.
STEPHEN K. WEST Of Counsel, Sullivan & Cromwell (law firm); 1998 0.00(0%)
(71) Director, Dresdner RCM Global Strategic In-
TRUSTEE come Fund, Inc. since May 1997 and The Swiss
125 Broad Street Helvetia Fund, Inc. since 1995 (investment
New York, NY 10004 companies), AMVESCAP PLC (investment manag-
ers) since 1997 and ING American Insurance
Holdings, Inc.; Trustee, The Winthrop Focus
Funds (investment companies); and Trustee of
all of the Pioneer mutual funds.
JOHN WINTHROP President, John Winthrop & Co., Inc. (private 1998 0.00(0%)
(64) investment firm); Director of NUI Corp.
TRUSTEE (energy sales, services and distribution);
One North Adgers Wharf and Trustee of all of the Pioneer mutual
Charleston, SC 29401 funds, except Pioneer Variable Contracts
Trust.
----------------
* Messrs. Cogan and Tripple are "interested persons" of each fund and Pioneer
within the meaning of Section 2(a)(19) of the 1940 Act.
(+) As of May 31, 2000, the trustees and officers of the fund beneficially
owned, directly or indirectly, in the aggregate less than 1% of the fund's
outstanding shares.
</TABLE>
Ms. Piret, Mr. West and Mr. Winthrop serve on the audit committee of the
board of trustees for the fund. The functions of the audit committee include
recommending independent auditors to the trustees, monitoring the independent
auditors' performance, reviewing the results of audits and responding to certain
other matters deemed appropriate by the trustees. Ms. Graham, Ms. Piret and Mr.
Winthrop serve on the nominating committee of the board of trustees. The primary
responsibility of the nominating committee is the selection and nomination of
candidates to serve as independent trustees. The nominating committee will also
consider nominees recommended by shareholders to serve as trustees provided that
shareholders submitting such recommendations comply with all relevant provisions
of Rule 14a-8 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
13
<PAGE>
During the fiscal year ended December 31, 1999, the board of trustees
held 12 meetings, the audit committee held 11 meetings and the nominating
committee did not hold any meetings. All of the current trustees and committee
members then serving attended at least 75% of the meetings of the board of
trustees and applicable committees, if any, held during the fiscal year ended
December 31, 1999.
As of May 31, 2000, Mr. Cogan beneficially owned _____________ shares
(______%) of the outstanding common stock of PGI. Mr. Cogan's beneficial
holdings included _____________ shares held in trusts with respect to which he
may be deemed to be a beneficial owner by reason of his interest as a
beneficiary and/or position as a trustee and shares which he has the right to
acquire under outstanding options within 60 days of May 31, 2000. At such date,
David D. Tripple owned beneficially ____% of the outstanding common stock of
PGI. None of the other nominees own more than 1% of the outstanding common stock
of PGI.
OTHER EXECUTIVE OFFICERS
In addition to Messrs. Cogan and Tripple, who serve as executive
officers of the fund, the following table provides information with respect to
the other executive officers of the fund. Each executive officer is elected by
the board of trustees and serves until his successor is chosen and qualified or
until his resignation or removal by the board. The business address of all
officers of the fund is 60 State Street, Boston, Massachusetts 02109.
<TABLE>
<CAPTION>
NAME (AGE), AND POSITION WITH THE FUND PRINCIPAL OCCUPATION(S)
-------------------------------------- -----------------------
<S> <C>
ERIC W. RECKARD (44), Treasurer Executive Vice President, Chief Financial Officer and Treasurer of PGI
since June 1999; Treasurer of Pioneer, PFD, PSC, PIntl, PREA, PFR and
Pioneer Omega since June 1999; Vice President-Corporate Finance of PGI
from February 1999 to June 1999; Manager of Fund Accounting, Business
Planning and Internal Audit of PGI since September 1996; Manager of
Fund Accounting and Compliance of PGI from May 1995 to September 1996;
and Treasurer of all of the Pioneer mutual funds (Assistant Treasurer
prior to June 1999).
JOSEPH P. BARRI (53), Secretary Corporate Secretary of PGI and most of its subsidiaries; Secretary of
all of the Pioneer mutual funds; and Partner, Hale and Dorr LLP.
VINCENT NAVE (55), Assistant Treasurer Vice President-Fund Accounting, Administration and Custody Services of
Pioneer (Manager from September 1996 to February 1999); and Assistant
Treasurer of all of the Pioneer mutual funds since June 1999.
ROBERT P. NAULT (36), Assistant Secretary Senior Vice President of PGI since 1998; General Counsel and Assistant
Secretary of PGI; Assistant Secretary of Pioneer, certain other PGI
subsidiaries and all of the Pioneer mutual funds; and Assistant Clerk
of PFD and PSC.
</TABLE>
14
<PAGE>
REMUNERATION OF TRUSTEES AND OFFICERS
The following table provides information regarding the compensation
paid by the fund and the other investment companies in the Pioneer Family of
Funds to the trustees for their services as indicated below during the year
ended December 31, 1999. Compensation paid by the fund to Messrs. Cogan and
Tripple, who are interested persons of Pioneer, is reimbursed to the fund by
Pioneer. The fund does not pay any salary or other compensation to its officers.
<TABLE>
<CAPTION>
TOTAL COMPENSATION FROM THE
AGGREGATE COMPENSATION FUND AND OTHER FUNDS IN THE
TRUSTEE FROM THE FUND PIONEER FAMILY OF FUNDS^1
<S> <C> <C>
John F. Cogan, Jr........................... 750 $18,000^2
Mary K. Bush................................ 2,757 93,500
Richard H. Egdahl, M.D...................... 2,757 95,500
Margaret B.W. Graham........................ 2,760 102,000
Marguerite A. Piret......................... 2,863 116,750
David D. Tripple............................ 750 18,000^2
Stephen K. West............................. 2,861 108,250
John Winthrop............................... 2,859 98,400
----- --------
Totals................................. 18,357 $650,400
====== ========
--------------------
1 The amounts paid to the Trustees differ due to (i) service by Dr. Egdahl,
Ms. Piret and Mr. West as trustees to another trust in the Pioneer Family
of Funds (Pioneer Variable Contracts Trust), (ii) membership on or chairing
certain committees of the boards of trustees, and (iii) attendance at
meetings.
2 Pioneer fully reimbursed the fund and the other mutual funds in the Pioneer
Family of Funds for compensation paid to Messrs. Cogan and Tripple.
</TABLE>
INVESTMENT ADVISER, ADMINISTRATOR AND PRINCIPAL UNDERWRITER
Pioneer and PFD, whose executive offices are located at 60 State
Street, Boston, Massachusetts 02109, serve as investment adviser and
administrator and principal underwriter, respectively, to the fund.
REQUIRED VOTE
In accordance with the fund's declaration of trust, the vote of a
plurality of all of the shares of the fund voted at the shareholder meeting is
sufficient to elect the nominees. This means that the eight nominees receiving
the greatest number of votes will be elected to the board. The election of
trustees is not contingent upon the consummation of the Transaction or the
approval of the proposed management contract.
15
<PAGE>
RECOMMENDATION
FOR THE REASONS SET FORTH ABOVE, THE TRUSTEES OF YOUR FUND UNANIMOUSLY
RECOMMEND THAT SHAREHOLDERS VOTE IN FAVOR OF EACH OF THE NOMINEES.
INFORMATION CONCERNING THE MEETING
OUTSTANDING SHARES AND QUORUM
As of the record date, [ ] shares of beneficial interest were
outstanding. Only shares of record as of the record date are entitled to notice
of and to vote at the meeting. A majority of the outstanding shares of the fund
that are entitled to vote will be considered a quorum for the transaction of
business.
OWNERSHIP OF SHARES OF THE FUND
To the knowledge of the fund, as of May 31, 2000, the following
shareholder held, beneficially or of record, 5% or more of the fund's
outstanding shares.
<TABLE>
<CAPTION>
NAME AND ADDRESS NO. OF SHARES OWNED PERCENTAGE OF FUND (%)
---------------- ------------------- ----------------------
<S> <C> <C>
Boston Financial Data 1,410,144.263 92.97
Services, Inc.
Two Heritage Drive
Quincy, MA 02171-2119
</TABLE>
SHAREHOLDER PROPOSALS
The fund is not required to hold annual meetings of shareholders and
does not currently intend to hold a meeting of shareholders in 2001. Shareholder
proposals to be presented at the next meeting of shareholders of the fund,
whenever held, must be received at the fund's offices, 60 State Street, Boston,
Massachusetts 02109, at a reasonable time prior to the trustees' solicitation of
proxies for the meeting. The submission by a shareholder of a proposal for
inclusion in a proxy statement does not guarantee that it will be included.
Shareholder proposals are subject to certain regulations under the federal
securities laws.
SHARES HELD IN RETIREMENT PLANS
The trustee or custodian of certain retirement plans is permitted to
vote any shares held in such plans in proportion to the percentages voted by
shareholders in person and by proxy, or in some cases, if necessary to obtain a
quorum.
16
<PAGE>
PROXIES, QUORUM AND VOTING AT THE MEETING
Any shareholder who has given his or her proxy to someone has the power
to revoke that proxy at any time prior to its exercise by executing a
superseding proxy or by submitting a notice of revocation to the secretary of
the fund. In addition, although mere attendance at the shareholder meeting will
not revoke a proxy, a shareholder present at the shareholder meeting may
withdraw his or her proxy and vote in person. All properly executed and
unrevoked proxies received in time for the shareholder meeting will be voted in
accordance with the instructions contained in the proxies. If no instruction is
given, the persons named as proxies will vote the shares represented thereby in
favor of the proposals described above and will use their best judgment in
connection with the transaction of such other business as may properly come
before the shareholder meeting or any adjournment thereof.
A majority of the shares entitled to vote, present in person or
represented by proxy, constitutes a quorum for the transaction of business with
respect to any proposal (unless otherwise noted in the proxy statement). In the
event that, at the time any session of the shareholder meeting for the fund is
called to order, a quorum is not present in person or by proxy, the persons
named as proxies may vote those proxies which have been received to adjourn the
shareholder meeting to a later date. In the event that a quorum is present but
sufficient votes in favor of any of the proposals, including the election of the
nominees to the board of trustees for the fund, have not been received, the
persons named as proxies may propose one or more adjournments of the shareholder
meeting to permit further solicitation of proxies with respect to such proposal.
Any such adjournment will require the affirmative vote of more than one half of
the shares of the fund present in person or by proxy at the session of the
shareholder meeting to be adjourned. The persons named as proxies will vote
those proxies which they are entitled to vote in favor of any such proposal in
favor of such an adjournment and will vote those proxies required to be voted
against any such proposal against any such adjournment. A shareholder vote may
be taken on one or more of the proposals in the proxy statement prior to such
adjournment if sufficient votes for its approval have been received and it is
otherwise appropriate. Such vote will be considered final regardless of whether
the meeting is adjourned to permit additional solicitation with respect to any
other proposal.
Shares of the fund represented in person or by proxy, including shares
which abstain or do not vote with respect to a proposal, will be counted for
purposes of determining whether there is a quorum at the shareholder meeting.
Accordingly, an abstention from voting has the same effect as a vote AGAINST a
proposal. However, if a broker or nominee holding shares in "street name"
indicates on the proxy card that it does not have discretionary authority to
vote on a proposal, those shares will NOT be considered present and entitled to
vote on that proposal. Thus, a "broker non-vote" has no effect on the voting in
determining whether a proposal has been adopted by 67% or more of the fund's
shares present at the shareholder meeting, if more than 50% of the outstanding
shares (excluding the "broker non-votes") of the fund are present or
represented. However, for purposes of determining whether a proposal has been
adopted by more than 50% of the outstanding shares of the fund, a "broker
non-vote" has the same effect as a vote against that proposal because shares
represented by a "broker non-vote" are considered to be outstanding shares.
17
<PAGE>
VOTING BY PLAN OWNERS
Because your ownership interest in fund shares is indirect (they're
held in your plan with the plan custodian as the record holder of those shares),
your vote will instruct the custodian how to vote the fund shares in your plan.
If you do not vote your fund shares, the custodian will vote your shares in the
same proportion as it votes the shares for which it has received instructions
from other plan owners.
OTHER BUSINESS
While the shareholder meeting has been called to transact any business
that may properly come before it, the only matters that the trustees intend to
present are those matters stated in the attached notice of special meeting of
shareholders. However, if any additional matters properly come before the
shareholder meeting, and on all matters incidental to the conduct of the
meeting, it is the intention of the persons named in the enclosed proxy to vote
the proxy in accordance with their judgment on such matters unless instructed to
the contrary.
METHOD OF SOLICITATION AND EXPENSES
The cost of preparing, assembling and mailing this proxy statement and
the attached notice of special meeting of shareholders and the accompanying
proxy card will be borne by PGI. In addition to soliciting proxies by mail, PGI
may, at its expense, have one or more of the fund's officers, representatives or
compensated third-party agents, including Pioneer, PSC and PFD, aid in the
solicitation of proxies by personal interview or telephone and telegraph and may
request brokerage houses and other custodians, nominees and fiduciaries to
forward proxy soliciting material to the beneficial owners of the shares held of
record by such persons. PGI has retained [_______________] to assist in the
solicitation of proxies. Shareholders who have not voted their proxies in a
timely manner may receive a telephone call from [______________] in an effort to
urge them to vote.
The fund may also arrange to have votes recorded by telephone, the
internet or other electronic means. The voting procedures used in connection
with such voting methods are designed to authenticate shareholders' identities,
to allow shareholders to authorize the voting of their shares in accordance with
their instructions and to confirm that their instructions have been properly
recorded. If these procedures were subject to a successful legal challenge, such
votes would not be counted at the shareholder meeting. The fund is unaware of
any such challenge at this time. Shareholders would be called at the phone
number PSC or the plans' custodian has in its records for their accounts, and
would be asked for their Social Security number or other identifying
information. The shareholders would then be given an opportunity to authorize
proxies to vote their shares at the meeting in accordance with their
instructions. To ensure that the shareholders' instructions have been recorded
correctly, they will also receive a confirmation of their instructions in the
mail. In the case of automated telephone and internet voting, shareholders would
be required to provide their Social Security number or other identifying
information and will receive a confirmation of their instructions. A special
toll-free number will be available in case the information contained in the
confirmation is incorrect.
Persons holding shares as nominees will be reimbursed by PGI, upon
request, for the reasonable expenses of mailing soliciting materials to the
principals of the accounts.
June __, 2000
18
<PAGE>
EXHIBIT A
FORM OF PROPOSED MANAGEMENT CONTRACT
THIS AGREEMENT dated as of this ___ day of ______________, 2000 between
Pioneer Independence Fund, a Delaware business trust (the "Trust"), and Pioneer
Investment Management, Inc., a Delaware corporation (the "Manager").
W I T N E S S E T H
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and has filed with the Securities and Exchange Commission (the "Commission") a
registration statement for the purpose of registering its shares for public
offering under the Securities Act of 1933, as amended (the "1933 Act").
WHEREAS, the parties hereto deem it mutually advantageous that the
Manager should be engaged, subject to the supervision of the Trust's Board of
Trustees and officers, to manage the Trust.
NOW, THEREFORE, in consideration of the mutual covenants and benefits
set forth herein, the Trust and the Manager do hereby agree as follows:
1. The Manager will regularly provide the Trust with investment research,
advice and supervision and will furnish continuously an investment program
for the Trust, consistent with the investment objective and policies of the
Trust. The Manager will determine from time to time what securities shall
be purchased for the Trust, what securities shall be held or sold by the
Trust and what portion of the Trust's assets shall be held uninvested as
cash, subject always to the provisions of the Trust's Certificate of Trust,
Agreement and Declaration of Trust, By-Laws and its registration statements
under the 1940 Act and under the 1933 Act covering the Trust's shares, as
filed with the Commission, and to the investment objective, policies and
restrictions of the Trust, as each of the same shall be from time to time
in effect, and subject, further, to such policies and instructions as the
Board of Trustees of the Trust may from time to time establish. To carry
out such determinations, the Manager will exercise full discretion and act
for the Trust in the same manner and with the same force and effect as the
Trust itself might or could do with respect to purchases, sales or other
transactions, as well as with respect to all other things necessary or
incidental to the furtherance or conduct of such purchases, sales or other
transactions.
2. The Manager will, to the extent reasonably required in the conduct of the
business of the Trust and upon the Trust's request, furnish to the Trust
research, statistical and advisory reports upon the industries, businesses,
corporations or securities as to which such requests shall be made, whether
or not the Trust shall at the time have any investment in such industries,
businesses, corporations or securities. The Manager will use its best
efforts in the preparation of such reports and will endeavor to consult the
persons and sources believed by
A-1
<PAGE>
it to have information available with respect to such industries,
businesses, corporations or securities.
3. The Manager will maintain all books and records with respect to the Trust's
securities transactions required by subparagraphs (b)(5), (6), (9) and (10)
and paragraph (f) of Rule 31a-1 under the 1940 Act (other than those
records being maintained by the custodian or transfer agent appointed by
the Trust) and preserve such records for the periods prescribed therefor by
Rule 31a-2 under the 1940 Act. The Manager will also provide to the Board
of Trustees such periodic and special reports as the Board may reasonably
request.
4. Except as otherwise provided herein, the Manager, at its own expense, shall
furnish to the Trust office space in the offices of the Manager or in such
other place as may be agreed upon from time to time, and all necessary
office facilities, equipment and personnel for managing the Trust's affairs
and investments, and shall arrange, if desired by the Trust, for members of
the Manager's organization to serve as officers or agents of the Trust.
5. The Manager shall pay directly or reimburse the Trust for: (i) the
compensation (if any) of the Trustees who are affiliated with, or
"interested persons" (as defined in the 1940 Act) of, the Manager and all
officers of the Trust as such; and (ii) all expenses not hereinafter
specifically assumed by the Trust where such expenses are incurred by the
Manager or by the Trust in connection with the management of the affairs
of, and the investment and reinvestment of the assets of, the Trust.
6. The Trust shall assume and shall pay: (i) charges and expenses for fund
accounting, pricing and appraisal services and related overhead, including,
to the extent such services are performed by personnel of the Manager or
its affiliates, office space and facilities, and personnel compensation,
training and benefits; (ii) the charges and expenses of auditors; (iii) the
charges and expenses of any custodian, transfer agent, plan agent, dividend
disbursing agent and registrar appointed by the Trust; (iv) issue and
transfer taxes chargeable to the Trust in connection with securities
transactions to which the Trust is a party; (v) insurance premiums,
interest charges, dues and fees for membership in trade associations and
all taxes and corporate fees payable by the Trust to federal, state or
other governmental agencies; (vi) fees and expenses involved in registering
and maintaining registrations of the Trust and/or its shares with federal
regulatory agencies, state or blue sky securities agencies and foreign
jurisdictions, including the preparation of prospectuses and statements of
additional information for filing with such regulatory authorities; (vii)
all expenses of shareholders' and Trustees' meetings and of preparing,
printing and distributing prospectuses, notices, proxy statements and all
reports to shareholders and to governmental agencies; (viii) charges and
expenses of legal counsel to the Trust and the Trustees; (ix) any
distribution fees paid by the Trust in accordance with Rule 12b-1
promulgated by the Commission pursuant to the 1940 Act; (x) compensation of
those Trustees of the Trust who are not affiliated with, or "interested
persons" of, the Manager, the Trust (other than as Trustees), The Pioneer
Group, Inc. or Pioneer Funds Distributor, Inc.; (xi) the cost of preparing
and printing share certificates; and (xii) interest on borrowed money, if
any.
A-2
<PAGE>
7. In addition to the expenses described in Section 6 above, the Trust shall
pay all brokers' and underwriting commissions chargeable to the Trust in
connection with securities transactions to which the Trust is a party.
8. The Trust shall pay to the Manager, as compensation for the Manager's
services and expenses assumed hereunder, a fee at the annual rate of 0.75%
of the Trust's average daily net assets. Management fees payable hereunder
shall be computed daily and paid monthly in arrears. In the event of
termination of this Agreement, the fee provided in this Section shall be
computed on the basis of the period ending on the last business day on
which this Agreement is in effect subject to a pro rata adjustment based on
the number of days elapsed in the current month as a percentage of the
total number of days in such month.
9. The management fee payable hereunder shall be computed daily and paid
monthly in arrears. In the event of termination of this Agreement, the fee
provided in Section 8 shall be computed on the basis of the period ending
on the last business day on which this Agreement is in effect subject to a
pro rata adjustment based on the number of days elapsed in the current
month as a percentage of the total number of days in such month.
10. The Manager may from time to time agree not to impose all or a portion of
its fee otherwise payable hereunder (in advance of the time such fee or a
portion thereof would otherwise accrue) and/or undertake to pay or
reimburse the Trust for all or a portion of its expenses not otherwise
required to be borne or reimbursed by the Manager. Any such fee reduction
or undertaking may be discontinued or modified by the Manager at any time.
11. It is understood that the Manager may employ one or more sub-investment
advisers (each a "Subadviser") to provide investment advisory services to
the Trust by entering into a written agreement with each such Subadviser;
provided, that any such agreement first shall be approved by the vote of a
majority of the Trustees, including a majority of the Trustees who are not
"interested persons" (as defined in the 1940 Act) of the Trust, the Manager
or any such Subadviser, and otherwise approved in accordance with the
requirements of the 1940 Act or an exemption therefrom. The authority given
to the Manager in Sections 1 through 13 hereof may be delegated by it under
any such agreement; provided, that any Subadviser shall be subject to the
same restrictions and limitations on investments and brokerage discretion
as the Manager. The Trust agrees that the Manager shall not be accountable
to the Trust or the Trust's shareholders for any loss or other liability
relating to specific investments directed by any Subadviser, even though
the Manager retains the right to reverse any such investment because, in
the event a Subadviser is retained, the Trust and the Manager will rely
almost exclusively on the expertise of such Subadviser for the selection
and monitoring of specific investments.
12. The Manager will not be liable for any error of judgment or mistake of law
or for any loss sustained by reason of the adoption of any investment
policy or the purchase, sale, or retention of any security on the
recommendation of the Manager, whether or not such recommendation shall
have been based upon its own investigation and research or upon
investigation and research made by any other individual, firm or
corporation, but nothing contained herein will be construed to protect the
Manager against any liability to the Trust or its shareholders by reason of
willful misfeasance, bad faith or gross negligence
A-3
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in the performance of its duties or by reason of its reckless disregard of
its obligations and duties under this Agreement.
13. Nothing in this Agreement will in any way limit or restrict the Manager or
any of its officers, directors, or employees from buying, selling or
trading in any securities for its or their own accounts or other accounts.
The Manager may act as an investment adviser to any other person, firm or
corporation, and may perform management and any other services for any
other person, association, corporation, firm or other entity pursuant to
any contract or otherwise, and take any action or do any thing in
connection therewith or related thereto; and no such performance of
management or other services or taking of any such action or doing of any
such thing shall be in any manner restricted or otherwise affected by any
aspect of any relationship of the Manager to or with the Trust or deemed to
violate or give rise to any duty or obligation of the Manager to the Trust
except as otherwise imposed by law. The Trust recognizes that the Manager,
in effecting transactions for its various accounts, may not always be able
to take or liquidate investment positions in the same security at the same
time and at the same price.
14. In connection with purchases or sales of securities for the account of the
Trust, neither the Manager nor any of its directors, officers or employees
will act as a principal or agent or receive any commission except as
permitted by the 1940 Act. The Manager shall arrange for the placing of all
orders for the purchase and sale of securities for the Trust's account with
brokers or dealers selected by the Manager. In the selection of such
brokers or dealers and the placing of such orders, the Manager is directed
at all times to seek for the Trust the most favorable execution and net
price available except as described herein. It is also understood that it
is desirable for the Trust that the Manager have access to supplemental
investment and market research and security and economic analyses provided
by brokers who may execute brokerage transactions at a higher cost to the
Trust than may result when allocating brokerage to other brokers on the
basis of seeking the most favorable price and efficient execution.
Therefore, the Manager is authorized to place orders for the purchase and
sale of securities for the Trust with such brokers, subject to review by
the Trust's Trustees from time to time with respect to the extent and
continuation of this practice. It is understood that the services provided
by such brokers may be useful to the Manager in connection with its or its
affiliates' services to other clients.
15. On occasions when the Manager deems the purchase or sale of a security to
be in the best interest of the Trust as well as other clients, the Manager
may, to the extent permitted by applicable laws and regulations, aggregate
the securities to be sold or purchased in order to obtain the best
execution and lower brokerage commissions, if any. In such event,
allocation of the securities so purchased or sold, as well as the expenses
incurred in the transaction, will be made by the Manager in the manner it
considers to be the most equitable and consistent with its fiduciary
obligations to the Trust and to such clients.
16. This Agreement shall become effective on the date hereof and shall remain
in force until ___________________, 2002 and from year to year thereafter,
but only so long as its continuance is approved in accordance with the
requirements of the 1940 Act or an exemption therefrom, subject to the
right of the Trust and the Manager to terminate this contract as provided
in Section 17 hereof.
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17. Either party hereto may, without penalty, terminate this Agreement by vote
of its Board of Trustees or Directors, as the case may be, or by vote of a
"majority of the outstanding voting securities" (as defined in the 1940
Act) of the Trust or the Manager, as the case may be, and the giving of 60
days' written notice to the other party.
18. This Agreement shall automatically terminate in the event of its
assignment. For purposes of this Agreement, the term "assignment" shall
have the meaning given it by Section 2(a)(4) of the 1940 Act.
19. The Trust agrees that in the event that neither the Manager nor any of its
affiliates acts as an investment adviser to the Trust, the name of the
Trust will be changed to one that does not contain the name "Pioneer" or
otherwise suggest an affiliation with the Manager.
20. The Manager is an independent contractor and not an employee of the Trust
for any purpose. If any occasion should arise in which the Manager gives
any advice to its clients concerning the shares of the Trust, the Manager
will act solely as investment counsel for such clients and not in any way
on behalf of the Trust.
21. This Agreement states the entire agreement of the parties hereto, and is
intended to be the complete and exclusive statement of the terms hereof. It
may not be added to or changed orally and may not be modified or rescinded
except by a writing signed by the parties hereto and in accordance with the
1940 Act, when applicable.
22. This Agreement and all performance hereunder shall be governed by and
construed in accordance with the laws of The Commonwealth of Massachusetts.
23. Any term or provision of this Agreement which is invalid or unenforceable
in any jurisdiction shall, as to such jurisdiction be ineffective to the
extent of such invalidity or unenforceability without rendering invalid or
unenforceable the remaining terms or provisions of this Agreement or
affecting the validity or enforceability of any of the terms or provisions
of this Agreement in any other jurisdiction.
24. This Agreement may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers and their seal to be hereto affixed
as of the day and year first above written.
ATTEST: PIONEER INDEPENDENCE FUND
------------------------------ ------------------------------------
Joseph P. Barri John F. Cogan, Jr.
Secretary Chairman and President
ATTEST: PIONEER INVESTMENT MANAGEMENT, INC.
------------------------------ ------------------------------------
Joseph P. Barri David D. Tripple
Secretary President
A-6
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EXHIBIT B
ADDITIONAL INFORMATION PERTAINING TO PIONEER
Pioneer is a wholly owned subsidiary of PGI. As of May 31, 2000,
executive officers and directors of Pioneer beneficially owned an aggregate of
____________ shares of common stock of PGI, representing approximately ____% of
the outstanding common stock of PGI. During the period January 1, 2000 through
May 31, 2000, there were no transactions in PGI common stock by any officer,
director or trustee of the fund, PGI, Pioneer and/or PFD in an amount equal to
or exceeding 1% of the outstanding common stock of PGI. Messrs. Cogan and
Tripple are trustees and officers of the fund and the directors of Pioneer. Mr.
Tripple is also the president (principal executive officer) of Pioneer. The
address of each of these persons is 60 State Street, Boston, Massachusetts
02109, and the principal occupation of each of these persons is as an employee
of PGI. Please see Proposal 2 for more detailed biographies of Messrs. Cogan and
Tripple.
SERVICES PROVIDED TO THE FUND BY AFFILIATES OF PIONEER
PSC serves as the fund's transfer agent and shareholder servicing
agent. Under the terms of its contract with the fund, PSC's duties include: (i)
processing sales, redemptions and exchanges of shares of the fund; (ii)
distributing dividends and capital gains to shareholder accounts; and (iii)
maintaining certain account records and responding to routine shareholder
inquires. PSC will continue to provide these services after the approval by
shareholders of the proposed management contract. For its most recently
completed fiscal year, the fund paid a total of $211,107 in transfer agency fees
to PSC.
PFD, an indirect wholly owned subsidiary of PGI, serves as the fund's
principal underwriter and as the sponsor for Pioneer Independence Plans and will
continue to serve as the fund's principal underwriter and as sponsor for Pioneer
Independence Plans after the approval by shareholders of the proposed management
contract. For its most recently completed fiscal year end, the fund paid
$________ to PFD in reimbursement of expenses related to servicing of
shareholder accounts and compensating broker/dealers and sales personnel. PFD
earned $334,965 in creation and sales charges or plan investments for the fund's
most recently completed fiscal year.
The fund has entered into an administration agreement with Pioneer
pursuant to which certain accounting and legal services, which are expenses
payable by the fund under the existing management contract, are performed by
Pioneer and pursuant to which Pioneer is reimbursed for its costs of providing
such services. Pioneer will continue to perform its services to the fund under
the administration agreement after the approval by shareholders of the proposed
management contract. For its most recently completed fiscal year, the fund paid
a total of $31,652 to Pioneer for such services.
PIONEER'S PORTFOLIO TRANSACTION POLICY
All orders for the purchase or sale of portfolio securities are placed
on behalf of the fund by Pioneer pursuant to authority contained in the existing
and proposed management contracts.
B-1
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In selecting brokers or dealers, Pioneer considers factors relating to
execution on the best overall terms available, including, but not limited to,
the size and type of the transaction; the nature and character of the markets of
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.
Pioneer may select broker-dealers which provide brokerage and/or
research services to the fund and/or other investment companies or institutional
or other accounts managed by Pioneer. Such research services must be lawful and
must provide appropriate assistance to Pioneer in the performance of its
investment decision-making responsibilities and could 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 analysis, 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).
In circumstances where two or more broker-dealers offer comparable
prices and executions, preference may be given to a broker-dealer which has sold
shares of the fund as well as shares of other investment companies managed by
Pioneer. This policy does not imply a commitment to execute all portfolio
transactions through all broker-dealers that sell shares of the fund. In
addition, 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-dealer, the fund may pay
commissions to such broker-dealer in an amount greater than the amount another
firm may charge. This information might be useful to Pioneer in providing
services to the fund as well as to other investment companies or accounts
managed by Pioneer, although not all of such research may be useful to the fund
generating the commission credits. Conversely, such information provided to
Pioneer by brokers and dealers through whom other clients of Pioneer effect
securities transactions might be useful to Pioneer in providing services to the
fund. The receipt of such research is not expected to reduce Pioneer's normal
independent research activities; however, it enables Pioneer to avoid the
additional expense which might otherwise be incurred if it were to attempt to
develop comparable information through its own staff.
B-2
<PAGE>
PROXY PROXY
PIONEER INDEPENDENCE FUND
PROXY FOR THE MEETING OF SHAREHOLDERS
To be held August ___, 2000
CONTROL NUMBER:
I (we), having received notice of the meeting and management's proxy
statement therefor, and revoking all prior proxies, hereby appoint John F.
Cogan, Jr., David D. Tripple, Robert P. Nault and Joseph P. Barri, and each of
them, my (our) attorneys (with full power of substitution in them and each of
them) for and in my (our) name(s) to attend the Meeting of Shareholders of my
(our) fund to be held on ______, August ___, 2000, at 2 p.m. (Boston time) at
the offices of Hale and Dorr LLP, counsel to the fund, 60 State Street, 26th
Floor, Boston, Massachusetts 02109, and any adjourned session or sessions
thereof, and there to vote and act upon the following matters (as more fully
described in the accompanying proxy statement) in respect of all shares of the
fund which I (we) will be entitled to vote or act upon, with all the powers I
(we) would possess if personally present.
IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING.
<PAGE>
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED BY THE
UNDERSIGNED. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE
PROPOSAL.
NOTE: In signing, please write name(s) exactly as
appearing hereon. When signing as attorney,
executor, administrator or other fiduciary, please
give your full title as such. Joint owners should
each sign personally
-----------------------------------
Signature
-----------------------------------
Signature(s)
Date_______________________,2000___
<PAGE>
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF YOUR FUND AND
SHOULD BE RETURNED AS SOON AS POSSIBLE IN THE ENVELOPE PROVIDED. THE BOARD
RECOMMENDS THAT YOU VOTE IN FAVOR OF THE FOLLOWING:
1. To approve a new management contract between the funds and Pioneer
Investment Management, Inc. ("Pioneer"), the funds' investment adviser.
This contract will take effect only if the proposed acquisition of
The Pioneer Group, Inc., the parent of Pioneer, by UniCredito Italiano
S.p.A. is consummated.
/ / FOR / / AGAINST / / ABSTAIN
2. To elect Trustees. The nominees for Trustees are:
01 M.K. Bush 02 J.F. Cogan, Jr.
03 Dr. R.H. Egdahl 04 M.B.W. Graham
05 M.A. Piret 06 D.D. Tripple
07 S.K. West 08 J. Winthrop
/ / FOR ALL / / WITHHOLD ALL / / FOR ALL EXCEPT
(as marked below)
To withhold authority to vote for one or more or the nominees, write the name(s)
of the nominee(s) on the line below:
-----------------------------------
