File No. 33-77472
File No. 811-08468
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. ___)
Filed by the Registrant /x/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/x/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
/ / Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e) (2))
Pioneer Bond 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.
<PAGE>
PIONEER BOND FUND
60 State Street
Boston, Massachusetts 02109
1-800-622-3265
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
SCHEDULED FOR MAY 4, 1999
This is the formal agenda for your fund's 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 Bond Fund:
A 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
Tuesday, May 4, 1999 at 2:00 p.m., Boston time, to consider the following:
1. To elect the nine (9) trustees named in the attached proxy
statement to serve on the board of trustees until their
successors have been duly elected and qualified.
2. A proposal to approve an Agreement and Plan of
Reorganization pursuant to which your fund, which is
currently organized as a Massachusetts business trust, would
be reorganized as a Delaware business trust.
3(a)-(k). Proposals to approve amendments to your fund's fundamental
investment policies and restrictions, as described in the
attached proxy statement.
4. Any other business that may properly come before the
meeting.
Shareholders of record as of the close of business of March 5, 1999 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
March 9, 1999
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 FUND WILL INCUR THE COST OF EXTRA SOLICITATIONS, WHICH IS
INDIRECTLY BORNE BY YOU AND OTHER SHAREHOLDERS.
0299-6108
<PAGE>
PROXY STATEMENT OF
PIONEER BOND 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 as summarized below.
PIONEER BOND FUND WILL FURNISH WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT TO ANY
SHAREHOLDER UPON REQUEST. SHAREHOLDERS WHO WANT TO OBTAIN A COPY OF THE FUND'S
ANNUAL REPORT OR SEMI-ANNUAL REPORT SHOULD DIRECT ALL WRITTEN REQUESTS TO THE
ATTENTION OF THE FUND, AT THE ADDRESS LISTED ABOVE, OR SHOULD CALL PIONEERING
SERVICES CORPORATION, THE FUND'S TRANSFER AGENT, AT 1-800-225-6292.
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.
This 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 Tuesday,
May 4, 1999, and at any adjournments of the meeting to a later date. The purpose
of this meeting is to consider:
1. The election of the nine (9) trustees named in this proxy
statement to serve on the board of trustees until their
successors have been duly elected and qualified.
2. A proposal to approve an Agreement and Plan of
Reorganization pursuant to which your fund, which is
currently organized as a Massachusetts business trust, would
be reorganized as a Delaware business trust.
3(a)-(k). Proposals to approve amendments to your fund's fundamental
investment policies, as described in this proxy statement.
4. Any other business that may properly come before the meeting.
This proxy statement and proxy are being mailed to shareholders on or about
March 9, 1999. The Annual Report for the fund for the fiscal period ended June
30, 1998, was previously mailed to shareholders.
WHO IS ELIGIBLE TO VOTE?
Shareholders of record of the fund as of the close of business on March
5, 1999 (the "record date") are entitled to vote on all of the fund's business
at the meeting or 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 to approve the
proposals. If any other business comes before the meeting, your shares will be
voted at the discretion of the persons named as proxies.
PROPOSAL 1
ELECTION OF BOARD OF TRUSTEES
All of the nominees for election currently serve as trustees for your
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 board of trustees of the
fund. The persons named on the accompanying proxy card intend to vote at the
meeting (unless otherwise directed) FOR the election of the nine (9) nominees
named below as trustees of the fund.
The following table sets forth each nominee's position(s) with the
fund, and their age, address, principal occupation and employment during the
past five years and any other directorships 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 February 26, 1999.
<TABLE>
<S> <C> <C> <C>
NUMBER OF SHARES
OWNED AND
PERCENTAGE OF
TOTAL SHARES
NAME, AGE, POSITION(S) WITH PRINCIPAL OCCUPATION OR EMPLOYMENT AND FIRST BECAME A OUTSTANDING ON
THE FUND AND ADDRESS TRUSTEESHIPS(1) TRUSTEE FEBRUARY 26, 1999
JOHN F. COGAN, JR.* (72) President, Chief Executive Officer and a 1990
CHAIRMAN OF THE BOARD, Director of The Pioneer Group, Inc. ("PGI");
PRESIDENT AND TRUSTEE Chairman and a Director of Pioneer Investment
60 State Street Management, Inc. ("Pioneer") and Pioneer
Boston, MA 02109 Funds Distributor, Inc. ("PFD"); Director of
Pioneering Services Corporation ("PSC"), Pioneer
Capital Corporation ("PCC"), Pioneer Real Estate
Advisors, Inc., Pioneer Forest, Inc., Pioneer
Explorer, Inc., Pioneer Management (Ireland) Ltd.
("PMIL") and Closed Joint Stock Company
"Forest-Starma"; President and Director of
Pioneer Metals and Technology, Inc. ("PMT"),
Pioneer International Corp. ("Pint"), Pioneer
First Russia, Inc. ("First Russia") and Pioneer
Omega, Inc. ("Omega"); Chairman of the Board and
Director of Pioneer Goldfields Limited ("PGL")
and Teberebie Goldfields Limited; Chairman of the
Supervisory Board of Pioneer Fonds Marketing,
GmbH, Pioneer First Polish Investment Fund Joint
Stock Company, S.A. and Pioneer Czech Investment
Company, A.S.; Chairman, President and Trustee of
all of the Pioneer mutual funds; Director of
Pioneer Global Equity Fund plc, Pioneer Global
Bond Fund Plc, Pioneer DM Cash Fund Plc, Pioneer
European Equity Fund Plc, Pioneer Emerging Europe
Fund Plc, Pioneer US Real Estate Fund Plc and
Pioneer U.S. Growth Fund Plc (collectively, the
"Irish Funds"); and Partner, Hale and Dorr LLP
(counsel to PGI and the fund).
MARY K. BUSH President, Bush & Co. (international 1997
(50) financial advisory firm); Director and/or
TRUSTEE Trustee of Mortgage Guaranty Insurance
4201 Cathedral Ave. NW Corporation, Novecon Management Company,
Apt. 1016E Hoover Institution, Folger Shakespeare
Washington, DC 20016 Library, March of Dimes, Project 2000, Inc.
(not-for-profit educational organization), Small
Enterprise Assistance Fund, Wilberforce
University and Texaco, Inc.; Advisory Board
Member, Washington Mutual Investors Fund
(registered investment company); and Trustee of
all the Pioneer mutual funds, except Pioneer
Variable Contracts Trust.
RICHARD H. EGDAHL, M.D. Alexander Graham Bell Professor of Health 1992
(72) Care Entrepreneurship, Boston University;
TRUSTEE Professor of Management, Boston University
Boston University Health School of Management; Professor of Public
Policy Institute Health; Boston University School of Public
55 Bay State Road Health; Professor of Surgery, Boston
Boston, MA 02115 University School of Medicine, University
Program for Health Care Entrepreneurship, CORE
(management of workers' compensation and
disability costs - Nasdaq National Market), and
WellSpace (provider of complementary health
care); Trustee, Boston Medical Center; Honorary
Trustee, Franciscan Children's Hospital; and
Trustee of all of the Pioneer mutual funds.
MARGARET B.W. GRAHAM Founding Director, The Winthrop Group, Inc. 1990
(51) (consulting firm); Manager of Research
TRUSTEE Operations, Xerox Palo Alto Research Center,
The Keep from 1991 to 1994; Professor of Operations
P.O. Box 110 Management and Management of Technology and
Little Deer Isle, ME 04650 Associate Dean, Boston University School of
Management, from 1989 to 1993; and Trustee of all
the Pioneer mutual funds, except Pioneer Variable
Contracts Trust.
JOHN W. KENDRICK Professor Emeritus, George Washington 1990
(81) University; Director, American Productivity
TRUSTEE and Quality Center; Adjunct Scholar, American
636 Waterway Drive Enterprise Institute; Economic Consultant;
Falls Church, VA 22044 and Trustee of all of the Pioneer mutual
funds, except Pioneer Variable Contracts Trust.
MARGUERITE A. PIRET President Newbury, Piret & Company, Inc. 1990
(50) (merchant banking firm); Trustee of Boston
TRUSTEE Medical Center; Member of the Board of
One Boston Place Governors of the Investment Company
Suite 2635 Institute; and Trustee of all of the Pioneer
Boston, MA 02108 mutual funds.
DAVID D. TRIPPLE* Executive Vice President and a Director of 1990
(55) PGI; President and a Director of Pioneer;
EXECUTIVE VICE PRESIDENT AND Director of PFD, PCC, Pintl, First Russia,
TRUSTEE Omega, Pioneer SBIC Corporation ("Pioneer
60 State Street SBIC"), PMIL and the Irish Funds; and
Boston, MA 02109 Executive Vice President and Trustee of all
of the Pioneer mutual funds.
STEPHEN K. WEST Of Counsel, Sullivan & Cromwell (law firm); 1993
(70) Director, Kleinwort Benson Australian Income
TRUSTEE Fund, Inc., The Swiss Helvetia Fund, Inc.
125 Broad Street (mutual funds), AMVESCAP PLC (investment
New York, NY 10004 managers) and American Insurance Holdings,
Inc.; Trustee, The Winthrop Focus Funds (mutual
funds); and Trustee of all of the Pioneer mutual
funds.
JOHN WINTHROP President, John Winthrop & Co., Inc. (private 1990
(62) 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.
</TABLE>
* Messrs. Cogan and Tripple are "interested persons" of the fund and
Pioneer within the meaning of Section 2(a)(19) of the Investment
Company Act of 1940 (the "1940 Act").
(1) Each nominee also serves as a trustee for each of the open-end
investment companies (mutual funds) in the Pioneer family of mutual
funds, for Pioneer Interest Shares, a closed-end investment company,
and for each of the twelve portfolios of the Pioneer Variable Contracts
Trust (except Messrs. Kendrick and Winthrop and Mmes. Graham and Bush,
who do not serve as trustees for Pioneer Variable Contracts Trust).
Except for Ms. Bush, each trustee was most recently elected by the
shareholders of the fund in 1995.
Ms. Bush was elected by the other trustees in 1997.
(2) As of February 26, 1999, the trustees and officers of the fund
beneficially owned, directly or indirectly, in the aggregate less than
1% of the fund's outstanding shares.
Ms. Piret, Mr. West and Mr. Winthrop serve on the audit committee of
the board of trustees. 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 also 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").
During the fiscal year ended June 30, 1998, the board of trustees held
twelve meetings, the audit committee held eleven meetings and the nominating
committee held one meeting. All of the current trustees and committee members
then serving attended at least 75% of the meetings of the board of trustees or
applicable committee, if any, held during the fiscal year ended June 30, 1998.
Mr. Cogan is an officer of Pioneer and owns, as of February 20, 1999,
approximately ___% of the outstanding Common Stock of Pioneer. None of the other
nominees own more than [1%] of the outstanding Common Stock of Pioneer.
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>
<S> <C>
NAME, AGE AND POSITION WITH THE FUND PRINCIPAL OCCUPATION(S)
JOHN A. BOYNTON, (44), Treasurer Executive Vice President, Treasurer and Chief
Financial Officer of PGI; and Treasurer of PFD and all
of the Pioneer mutual funds. Prior to joining PGI in
November 1998, Mr. Boynton was a Senior Vice President
of The Quaker Oats Company.
JOSEPH P. BARRI, (52), Secretary Corporate Secretary of PGI and most of its
subsidiaries; Secretary of all of the Pioneer mutual
funds; and Partner, Hale and Dorr LLP.
ERIC W. RECKARD, (42), Assistant Treasurer Vice President-Corporate Finance since February 1999;
Manager of Business Planning and Internal Audit of PGI
since September 1996; Manager of Fund Accounting of
Pioneer since May 1994; Manager of Auditing,
Compliance and Business Analysis for PGI prior to May
1994; and Assistant Treasurer of all of the Pioneer
mutual funds.
ROBERT P. NAULT, (34), Assistant Secretary Senior Vice President, General Counsel and Assistant
Secretary of PGI since 1995; Assistant Secretary of
Pioneer, certain other PGI subsidiaries and all of the
Pioneer mutual funds; Assistant Clerk of PFD and PSC;
and junior partner of Hale and Dorr LLP prior to 1995.
</TABLE>
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
mutual funds to the trustees for their services as indicated below. 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 pays no salary or other
compensation of its officers.
<TABLE>
<S> <C> <C>
TOTAL COMPENSATION FROM THE FUND
AND OTHER FUNDS IN THE PIONEER
AGGREGATE COMPENSATION FAMILY OF MUTUAL FUNDS++
TRUSTEE FROM THE FUND+
John F. Cogan, Jr. $ 500* $ 18,750*
Mary K. Bush 1,852 77,125
Richard H. Egdahl, M.D. 1,851 79,125
Margaret B.W. Graham 1,859 81,750
John W. Kendrick 1,752 65,900
Marguerite A. Piret 2,140 98,750
David D. Tripple 500* 18,750*
Stephen K. West 1,949 85,050
John Winthrop 2,079 85,875
------ ------
Totals $14,482 $611,075
======== ========
</TABLE>
* Pioneer fully reimbursed the fund and the other mutual funds in the
Pioneer family of mutual funds for compensation paid to Messrs.
Cogan and Tripple.
+ For the fiscal year ended June 30, 1998.
++ For the calendar year ended December 31, 1998.
INVESTMENT ADVISER
Pioneer and Pioneer Fund Distributors, Inc., whose executive offices
are located at 60 State Street, Boston, Massachusetts 02109, serve as investment
adviser and principal underwriters, respectively, to the fund.
REQUIRED VOTE
In accordance with the fund's Agreement and Declaration of Trust, the
vote of a plurality of all of the shares of the fund voted at the meeting is
sufficient to elect the nominees. This means that the nine (9) nominees
receiving the greatest number of votes will be elected to the board.
PROPOSAL 2
APPROVAL OF AN AGREEMENT AND PLAN PROVIDING FOR THE
REORGANIZATION OF THE FUND FROM A MASSACHUSETTS
BUSINESS TRUST TO A DELAWARE BUSINESS TRUST
GENERAL
At a meeting held on January 5, 1999, the trustees who were present
unanimously approved, subject to the approval of shareholders of the fund, an
Agreement and Plan of Reorganization in the form attached to this proxy
statement as Exhibit A. The Plan of Reorganization provides for the
reorganization of your fund, currently a Massachusetts business trust, into a
newly established Delaware business trust (the "successor fund"). Prior to the
reorganization, the newly established Delaware business trust will have no
assets or operations other than such minimum assets supplied by Pioneer or one
of its affiliates as may be required to establish independent SEC registration.
After the reorganization is complete, the successor fund will carry on
the business of your fund. If your fund's shareholders approve the proposed
changes to the fund's fundamental investment policies described in Proposals
3(a)-(m) below, the successor fund's operations will change accordingly, to the
extent approved. If these changes are not approved, the successor fund will have
investment policies and restrictions that are identical to the investment
policies and restrictions of your fund. The successor fund will also enter into
a management contract and other service agreements which provide the same
services on the same terms as those applicable to your fund.
The principal differences between a Delaware business trust and a
Massachusetts business trust as forms of organization are discussed below under
the caption "Comparison of business trusts under Delaware law and Massachusetts
law." Approval of the reorganization also constitutes approval of the
termination of your fund in accordance with Massachusetts law. Following the
reorganization, Pioneer will serve as investment adviser for the successor fund
under a management contract which will have been approved by the board of
trustees of the successor fund and by your fund, each as a sole shareholder of
the successor fund, as further discussed below under the captions "Summary of
the plan of reorganization."
REASONS FOR THE PROPOSED REORGANIZATION
Your fund presently is organized as a Massachusetts business trust. The
proposed form of organization of your fund as a Delaware business trust offers
certain advantages over the current form of organization as a Massachusetts
business trust. The advantages include:
o clearer limitations upon liability for your fund's shareholders
and trustees
o greater flexibility in the methods of shareholder voting
o affording the trustees greater flexibility to amend the Delaware
Declaration of Trust without shareholder approval (although this
advantage could also be achieved under Massachusetts law by
amending your fund's Declaration of Trust)
COMPARISON OF BUSINESS TRUST UNDER DELAWARE LAW AND MASSACHUSETTS LAW
LIMITATION OF SHAREHOLDERS' SERIES' LIABILITY. Delaware law provides
that the shareholders of a Delaware business 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 your fund's
shareholders) may, under certain circumstances, be liable 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, the board of trustees has determined that Delaware law
affords greater protection against potential shareholder liability. Similarly,
Delaware law provides that, to the extent that a Delaware business 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 multiple series 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. Your fund has not issued multiple series of shares, and the trustees
have no current intention to issue such shares. However, to the extent the board
of trustees determines that the issuance of multiple series of shares is
prudent, the trustees believe that your fund would be better situated to do so
as a Delaware business trust.
LIMITATION OF TRUST LIABILITY. Delaware law provides that, except to
the extent otherwise provided in a fund's declaration of trust or bylaws,
trustees will not be personally liable to any person (other than the business
trust or a shareholder thereof) for any act, omission or obligation of the
business trust or any trustee thereof. Delaware law also provides that a
trustee's actions under a Delaware business trust's declaration of trust or
bylaws will not subject the trustee to liability to the business trust or its
shareholders if the trustee takes such action in good faith reliance on the
provisions of the business trust's declaration of thrust or bylaws. The
declaration of trust of a Massachusetts business trust may limit liability of a
trustee who is not also an officer of the trust, 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 the trustee derives an improper direct or indirect financial benefit.
The trustees believe that such limitations on liability under Delaware law 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 business
trust's declaration of trust or bylaws may set forth provisions related to
voting in any manner. This provision appears to permit trustee and shareholder
voting though 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
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 business
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 business
trust to be governed by individuals who are more familiar with the series'
particular operations.
COMPARISON OF YOUR FUND'S DECLARATION OF TRUST UNDER MASSACHUSETTS LAW AND
DELAWARE DECLARATIONS OF TRUST UNDER DELAWARE LAW
It is anticipated that the Delaware business trust will be required to
hold fewer shareholder meetings than the Massachusetts business trust,
potentially further reducing costs. Although neither a Delaware business trust
nor a Massachusetts business trust is required to hold annual shareholder
meetings, Delaware law affords to the trustees the ability to adapt the Delaware
business trust to future contingencies without the necessity of a holding a
special shareholder meeting. The trustees may have the power to amend the
business trust's governing instrument to create a class or series of beneficial
interest that was not previously outstanding; to dissolve the business trust; to
incorporate the Delaware business trust; to merge or consolidate with another
entity; to sell, lease, exchange, transfer, pledge or otherwise dispose of all
or any part of the business trust's assets; to cause any series to become a
separate trust; and to change the Delaware business trust's domicile -- all
without shareholder vote. Any exercise of authority by the trustees is subject
to applicable state and federal law. The flexibility of Delaware business trusts
should help to assure that the Delaware business trust always operates under the
most advantageous form of organization and may reduce the expense and frequency
of future shareholder meetings for non-investment-related operational issues.
TRUSTEES' RECOMMENDATION
After the matters discussed above and other matters deemed to be
relevant, your board of trustees determined that the reorganization is in the
best interest of your fund and will not result in the dilution of the interest
of your fund's shareholders. The trustees present at the meeting held on January
5, 1999 unanimously voted to recommend that you vote FOR the reorganization.
REQUIRED VOTE
Since the Board of Trustees recommends the reorganization, approval of
the Agreement and Plan of Reorganization requires the affirmative vote of a
majority of the shares of your fund outstanding and entitled to vote. For this
purpose, a majority of the outstanding shares of your fund means with respect to
each proposal the vote of the less of
(1) 67% or more of the shares present at the meeting, if the holders of
more than 50% of the shares of the fund are present or represented
by proxy, or
(2) more than 50% of the outstanding shares of the fund.
In the event that the shareholders of your fund do not vote in favor of the
reorganization, the trustees will determine what further action, if any, to
take, including the possibility of resubmitting the proposal at a later time.
THE TRUSTEES RECOMMEND THAT THE SHAREHOLDERS OF YOUR FUND APPROVE THE AGREEMENT
AND PLAN OF REORGANIZATION PROVIDING FOR THE REORGANIZATION OF YOUR FUND FROM A
MASSACHUSETTS BUSINESS TRUST TO A DELAWARE BUSINESS TRUST.
SUMMARY OF THE PLAN OF REORGANIZATION
The following discussion summarizes certain terms of the Plan of
Reorganization. This summary of the Plan of Reorganization is qualified in its
entirety by the provisions of the form of Plan or Reorganization, which is
attached to this proxy statement as Exhibit A. Assuming the Plan of
Reorganization is approved, and your fund is able to obtain the necessary
consent, approval, authorization or order of any court or governmental
authority, it is currently contemplated that the Reorganization will become
effective at the close of business on or about May 31, 1999.
In order to accomplish the reorganization, a Delaware business trust
has been formed. On the closing date of the reorganization (the "Closing Date"),
your fund will transfer all of its assets to the successor fund in exchange for
the assumption by the successor fund of all the liability of your fund and the
issuance to your fund of shares of beneficial interest of the successor fund
("successor fund shares") equal to the value (as determined by using the
procedures set forth in your fund's current prospectus) on the dates of the
exchange of your fund's net assets. Consequently, for each share of the fund
outstanding at the time of the reorganization, one successor fund share of the
same class will be issued to the fund. Your fund, as sole shareholder of the
successor fund, will then vote on certain matters that require shareholder
approval, as described below. Immediately thereafter, your fund will liquidate
and distribute successor fund shares to each shareholder pro rata in proportion
to the shareholder's beneficial interest in each class of your fund in exchange
for his or her current fund shares. After such distributions of successor fund
shares, your fund will, as soon as practicable thereafter, be wound up and
terminated. Certificates evidencing full or fractional successor fund shares
will not be mailed to shareholders. UPON COMPLETION OF THE REORGANIZATION, EACH
OF YOUR FUND'S SHAREHOLDERS WILL BE THE OWNER OF FULL FRACTIONAL SUCCESSOR FUND
SHARES OF THE SAME CLASS AND EQUAL IN NUMBER AND AGGREGATE NET ASSET VALUE TO
HIS OR HER FUND SHARES AS OF THE DATE OF THE EXCHANGE.
As described above, the Plan of Reorganization authorizes of your fund
as the then sole shareholder of a corresponding successor fund (i) to elect as
trustees of the Delaware business trust the persons who currently serve as
trustees of the Massachusetts business trust; (ii) to ratify the selection of
the independent accountants; (iii) to approve the Rule 12b-1 plan of
distribution for the successor fund and (iv) to approve the management contract
for the successor fund. With respect to the foregoing matter, the successor fund
will vote after the board of trustees of the successor fund has approved such
matters.
The newly elected trustees will hold office without limit in time
except that (i) any trustee may resign; (ii) any trustee may be removed by
written instrument signed by at least a majority of the trustees prior to
removal; and (iii) a trustee may be removed at any special meeting of the
shareholders of the successor fund by a vote of two-thirds of the outstanding
shares of the successor fund. In case a vacancy shall exist for any reason, the
remaining trustees of the successor fund for which the vacancy exists will fill
such vacancy by appointing another trustee so long as, immediately after such
appointment, at least two-thirds of the trustees have been elected by the
shareholders of the successor fund.
If, at any time prior to the Closing Date, (a) the trustees determine
that it would not be in the best interest of your fund or your fund's
shareholders to proceed with the execution of the Plan of Reorganization, or (b)
your fund is unable to obtain the consent, approval, authorization or order of
any court or governmental authority, the reorganization may not go forward,
notwithstanding the approval of the reorganization by the shareholders at the
meeting. The obligations of your fund under the Plan of Reorganization are
subject to various conditions as stated therein. In order to provide against
unforeseen events, the Plan of Reorganization may be terminated or amended at
any time prior to the reorganization by mutual agreement of the trustees of your
fund and the successor fund. Your fund and the successor fund may waive
compliance with any of the covenants and conditions contained in, or may amend
the Plan of Reorganization; provided that such waiver or amendment does not
materially adversely affect the interests of shareholders of your fund.
NEW SECURITIES AND EXCHANGE COMMISSION ("SEC") REGISTRATION
Under the reorganization, the successor fund will assume your fund's
existing registration statements under the Securities Act of 1933, as amended
(the "1933 Act") and the 1940 Act.
CONTINUATION OF SHAREHOLDER ACCOUNTS AND SERVICES
The successor fund's transfer agent, Pioneering Services Corporation
("PSC"), will establish accounts for all shareholders of the successor fund
containing the appropriate number of successor fund shares to be received by the
shareholder under the Plan of Reorganization. Such account will be identical in
all material respects to the accounts currently maintained by PSC for each of
your fund's shareholders. Shareholders who have elected to receive a particular
service, such as telephone redemptions or exchanges or Pioneer Investomatic
Plans, will continue to receive such services as shareholders of the successor
fund without any further action.
EXPENSES OF THE REORGANIZATION
Pioneer will bear ALL expenses associated with the transactions
contemplated by the Plan of Reorganization.
TAX CONSEQUENCES OF THE REORGANIZATION
It is a condition to the consummation of the reorganization that your
fund receives on or before the Closing Date an opinion from counsel, Hale and
Dorr LLP, substantially to the effect that, among other things, for federal
income tax purposes the transactions contemplated by the Plan of Reorganization
will constitute a reorganization under Section 368(a)(1) of the Internal Revenue
Code of 1986, as amended, and that, consequently, no gain or loss will be
recognized for federal income tax purposes by your fund or its shareholders upon
(1) the transfer of all of the assets of your fund to the successor fund in
exchange solely for successor fund shares and the assumption by the successor
fund of your fund's liabilities and (2) the distribution by your fund of the
successor fund shares, in liquidation of your fund, to the shareholders in
exchange for your fund's shares. The opinion will further state, among other
things, that (i) the federal tax basis of successor fund shares to be received
by shareholders of your fund will be the same as the federal tax basis of the
shares of your fund surrendered in exchange therefor and (ii) each shareholder's
federal tax holding period for his or her successor fund shares will include
such shareholder's holding period for shares of your fund surrendered in
exchange therefor, provided that such shares were held as capital assets on the
date of the exchange.
DESCRIPTION OF CERTAIN PROVISIONS OF THE SUCCESSOR FUND'S DELAWARE DECLARATION
OF TRUST
The following is a summary of certain provisions of the successor
fund's Delaware Declaration of Trust.
SERIES AND CLASSES. As discussed above, the Delaware Declaration of
Trust would permit the successor fund to issue series of its shares which would
represent interests in separate portfolios of investments including the
corresponding current fund. No series would be entitled to share in the assets
of any other series or be liable for the expenses or liabilities of any other
series. The trustees would also be able to authorize the successor fund to issue
additional classes of shares without prior shareholder approval.
LIMITATIONS AND DERIVATIVE ACTIONS. In addition to the requirements
under Delaware law, the Delaware Declaration of Trust provides that a
shareholder of the successor fund may bring a derivative action on behalf of
such successor fund only if the following conditions are met: (a) shareholders
eligible to bring such derivative action under Delaware law who hold at least
10% of the outstanding shares of the successor fund or 10% of the outstanding
shares of the series or class of which such action relates, shall join in the
request for the trustees to commence such action; and (b) the trustees must be
afforded a reasonable amount of time to consider such shareholder request and to
investigate the basis of such claim. The trustees shall be entitled to retain
counsel or other advisers in considering the merits of the request and shall
require an undertaking by the shareholders making such request to reimburse the
successor fund for the expense of any such advisers in the event that the
trustees determine not to bring such action. Trustees who are not "interested
persons" as such term is used under the 1940 Act shall be deemed to be
independent for purposes of all action taken by the Trustees, including any
action taken with respect to a derivative action.
SHAREHOLDER MEETINGS AND VOTING RIGHTS. The successor fund is not
required to hold annual meetings of shareholders and does not intend to hold
such meetings. In the event that a meeting of shareholders is held for the
successor fund, each share of the successor fund shall be entitled to one vote
on all matters presented to shareholders including the election of trustees.
Shareholders of the successor fund do not have cumulative voting rights in
connection with the election of trustees. Meetings of shareholders of the
successor fund, or any series or class thereof, may be called by the trustees,
certain officers or upon the written request of holders of 10% or more of the
shares entitled to vote at such meetings. The shareholders of the successor fund
shall only have the right to vote with respect to the limited number of matters
specified in the corresponding Delaware Declaration of Trust and such other
matters as the trustees shall determined or shall be required by law.
INDEMNIFICATION. The Delaware Declaration of Trust of the successor
fund provides for indemnification of trustees, officers and agents of the
successor fund provided that no such indemnification shall be provided to any
person who is adjudicated (i) to be liable by reason of willful misfeasance, bad
faith, gross negligence or reckless disregarded of the duties involved in the
conduct of such person's office or (ii) not to have acted in good faith in the
reasonable belief that such person's actions were in the best interest of the
Delaware business trust.
The Delaware Declaration of Trust provides that if any present or
former shareholders of the successor fund, or any future series thereof, shall
be held personally liable solely by reason of that person being or having been a
shareholder and not because of such shareholder's act or omissions or for some
other reason that shareholder (or their heirs, executors administrators or other
legal representatives or in the case of any entity, its general successor) shall
be entitled, out of the assets belonging to the successor fund or series
thereof, to be held harmless from and indemnified against all loss and expense
arising from such liability. The successor fund, on its own behalf or on behalf
of any affected series, shall, upon request by the shareholder, assume the
defense of any claim made against the shareholder for any act or obligation of
the fund or series thereof, and satisfy any judgment any judgment thereon from
the assets of the fund or series thereof.
TERMINATION. The Delaware Declarations of Trust would permit
termination of the successor fund or of any series or class of the successor
fund (i) by a majority of the shareholders at a meeting of shareholders of the
successor fund, series or class; or (ii) by a majority of the trustees without
shareholder approval if the trustees determine that such action is in the best
interest of the fund or its shareholders. The factors and events that the
trustees may take into account in making such determination include (i) the
inability of the successor fund, or any successor series or class to maintain
their assets at an appropriate size; (ii) changes in laws or regulations
governing them or affecting assets of the type in which they invest; or (iii)
economic developments or trends having a significant adverse impact on their
business or operations. Termination of your fund requires the affirmative 1940
Act majority vote of the fund.
MERGER, CONSOLIDATION, SALE OF ASSETS, ETC. The Delaware Declaration of
Trust would authorize the trustees of the successor fund without shareholder
approval to specifically permit the successor fund, or any series thereof, to
merge or consolidate with any corporation, association, trust or other
organization or sell or exchange all or substantially all of the property
belonging to the successor fund, or any series thereof. The Massachusetts
Declaration of Trust does not specifically provide for mergers or consolidations
of your fund. A sale of assets of your fund would require an affirmative 1940
Act majority vote of the fund.
AMENDMENTS. The Delaware Declaration of Trust would permit the trustees
to amend the Delaware Declaration of Trust without a shareholder vote; provided
that shareholders of the successor fund shall have the right to vote on any
amendment (i) that would affect the voting rights of shareholders, (ii) with
respect to which shareholder approval is required by law; (iii) that would amend
this provision of the Declaration of Trust; and (iv) with respect to any other
matter that the trustees determine to submit to shareholders. Any amendment to
the your fund's Declaration of Trust, except an amendment changing the name of
the fund or supplying any omission, curing any ambiguity or curing, correcting
or supplementing any defective or inconsistent provision of the Declaration of
Trust, requires the affirmative 1940 Act majority vote of the fund.
PROPOSALS 3(A) THROUGH 3(K)
AMENDMENT TO THE FUND'S FUNDAMENTAL
INVESTMENT POLICIES AND RESTRICTIONS
Pioneer and your board of trustees recommend that a number of changes
be made to modernize your fund's fundamental investment policies and
restrictions. The purpose of these changes is to afford your fund additional
flexibility to respond more quickly to a constantly changing investment
environment. Specifically, these changes are designed to give your fund the same
degree of flexibility that many other mutual funds that are in the same category
as your fund (I.E., investment grade bond funds) typically have without
increasing the risks associated with investing in the fund beyond the industry
norm for this type of bond fund. We are asking you to vote on these changes
because the policies and restrictions described below are fundamental and may be
changed only with shareholder approval. Please be aware that the fund's
fundamental investment objective of providing current income from a high quality
portfolio with due regard to preservation of capital and prudent investment risk
will not change if these changes are approved.
The 1940 Act requires mutual funds to adopt fundamental investment
policies and restrictions covering certain types of investment practices. Your
fund, however, is also subject to a number of other fundamental policies and
restrictions that are not required by the 1940 Act or any other current laws. In
fact, most of your fund's investment policies were designated as fundamental
when your fund was organized in 1978 because that was the standard practice in
the mutual fund industry at the time. The mutual fund industry has matured
significantly over the last 21 years, and the vast majority of mutual funds
which are organized today do not designate their investment policies (or even
investment objectives for that matter) as fundamental so that they will have
greater flexibility to respond to changes in the investment landscape.
Similarly, most of your fund's investment restrictions were adopted to reflect
certain regulatory, business or industry conditions which are no longer in
effect, especially the "blue sky" laws formerly imposed by state securities
regulations. It is also recommended that some of the fundamental restrictions be
liberalized to the extent permitted under the 1940 Act in light of current
interpretive positions of the staff of the Securities and Exchange Commission
(the "SEC").
Pioneer expects that you will benefit from these proposed changes to
the fund's fundamental policies and investment restrictions in several ways.
First, the fund would have the same degree of flexibility to respond to new
developments and changing trends in the fixed income marketplace that other
comparable funds typically have. Pioneer believes that this added flexibility
will make your fund more competitive among its peer group of bond funds. Pioneer
recognizes that this added flexibility may also introduce added risks to an
investment in the fund. However, Pioneer believes that these changes may improve
the fund's risk-return balance by allowing for enhanced performance at a minimal
increase in risk for the fund's overall portfolio. Pioneer would carefully
evaluate all new investment opportunities which could become available to the
fund as a result of the increased flexibility to determine whether any would be
suitable for the fund given its investment objective, policies and risk profile.
In addition, Pioneer believes that these changes will NOT expose the fund's
shareholders to risks that are any greater than the risks normally associated
with investing in comparable bond funds.
Second, the proposed changes to the fund's investment restrictions are
designed to produce a clearer and more concise set of restrictions. These
revised restrictions parallel the investment restrictions of other funds managed
by the adviser, which will facilitate the adviser's compliance efforts. Also,
these revised restrictions should assist investors in understanding the
characteristics and risks associated with this fund and will allow for more
effective comparison to other mutual funds with similar investment objectives.
PROPOSED AMENDMENTS TO INVESTMENT POLICIES AND RESTRICTIONS
The table below sets forth the fund's current fundamental policies and
restrictions in the left hand column and the proposed amended policies or
restrictions in the right hand column. The current restrictions are presented in
the same order as they are listed in the fund's statement of additional
information. The amended restrictions, if approved, will be reordered in the
fund's revised statement of additional information.
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<TABLE>
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL POLICY
3(a) At least 85% of the fund's total assets must be AMENDED AS FOLLOWS: At least 80% of the
invested in (a) debt securities issued or guaranteed fund's total assets must be invested in (a)
by the U.S. government or its agencies or debt securities issued or guaranteed by the
instrumentalities, (b) investment-grade securities, U.S. government or its agencies or
that is, debt securities, including convertible instrumentalities, (b) investment-grade
securities, that are rated "A" or higher by the securities, that is, debt securities,
major recognized bond services, and comparably rated including convertible securities, that are
commercial paper and (c) cash and cash equivalents rated "BBB" or higher by a nationally
(such as certificates of deposit, repurchase recognized statistical rating organization
agreements maturing in one week or less and bankers' and comparably rated commercial paper and
acceptances) (c) cash and cash equivalents (such as
certificates of deposit, repurchase
The fund may also invest up to 15% of its total agreements maturing in one week or less and
assets in debt securities, including convertible bankers' acceptances)
securities, which are rated in the fourth highest
grade by the major recognized bond services and The fund may invest up to 20% of its total
commercial paper which is comparable. None of the assets in debt securities rated below
fund's portfolio may be invested in debt securities investment or in unrated securities that are
which are rated below the fourth highest grade or determined to be of equivalent quality by
are unrated, except that the fund may hold debt Pioneer.
securities the ratings of which are reduced
subsequent to purchase.
</TABLE>
EXPLANATION FOR PROPOSAL 3(A). The Trustees recommend that the rating criteria
for the fund's investments be made non-fundamental and revised to permit the
fund greater flexibility to invest in fixed income securities rated BBB (the
lowest investment grade category) and below. This policy change will give the
fund greater flexibility to select from a wider range of debt securities. The
fund's current policies do not allow the fund to invest in debt securities rated
below investment grade (or in unrated securities of equivalent quality) and
limit securities rates of BBB to 15% of the fund's assets. Pioneer believes that
these sectors of the fixed income marketplace offers a number of attractive
investment opportunities for your fund. Pioneer believes that by investing a
greater portion of the fund in securities rated BBB and allocating a small
portion of the fund's assets to below investment grade securities, the fund can
enhance its performance without subjecting the fund to undue additional risk. In
addition, Pioneer believes that this added flexibility will allow the fund to
compete on a more equal footing with other comparable bond funds which typically
allocate up to 20% of their assets to below investment grade securities and are
not restricted in their allocation among investment grade categories. In
addition, by making this policy non-fundamental, the Trustees will be able to
authorize further changes in the fund's rating criteria in the future.
Consequently, the fund will be able to respond to the changing market
environment without the delay and cost of a shareholder vote.
The fund's primary investment focus will remain investment grade debt
securities. If the changes are approved, at least 80% of the fund's total
assets will be invested in investment grade securities. The remainder of the
fund's assets, up to 20%, would be available for investment in below investment
grade securities. This does not mean that Pioneer will always allocate the full
20% of the fund's total assets to such securities. Pioneer will only advise the
fund to purchase below investment grade securities after conducting a thorough
analysis of the issuer of the security and only if Pioneer determines that the
purchase would be consistent with the fund's investment objective of providing
current income with due regard for the preservation of capital and prudent
investment risk.
<TABLE>
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL POLICY
3(b) Not more than 15% of the fund's assets may be The fund may invest up to 15% of its total
invested in foreign securities and not more than 5% assets in securities of non-U.S. issuers,
of its total assets may be invested in foreign including up to 5% of its total assets in
securities that are not listed on a recognized securities of emerging market issuers. This
foreign or domestic exchange, provided that limitation does not apply to securities of
purchases of Canadian securities are not subject to Canadian issuers.
the limitations of this paragraph.
</TABLE>
EXPLANATION OF PROPOSAL 3(B). Other than redesignating this policy as
non-fundamental, the only change are to eliminate 5% limit on bonds that are not
listed and to allow the fund it invest a portion of the assets which it
allocates to foreign securities to securities of issuers located in emerging
market countries. The 5% limit on bonds is no longer relevant and reflects a
time when most bonds were listed on an exchange. Currently, bonds generally
trade in the over-the-counter market. Eliminating this 5% limit would treat
domestic and foreign bonds equally. Emerging market countries are generally
considered to be those countries with less developed economies and securities
markets. Pioneer believes that this change will broaden the fund's investment
universe in a manner that will allow it to invest in potentially higher yielding
securities without adding undue risk to the fund's portfolio.
Investing in non-U.S. issuers may involve unique risks compared to investing in
the 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 and 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 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 Political, economic and social developments that adversely affect the
securities markets
o Withholding and other foreign taxes may decrease the fund's return
<TABLE>
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not: The fund may not:
3(c) (1) Purchase any security (other than (1) Make any investment inconsistent with
securities issued or guaranteed by the U.S. the fund's status as a diversified investment
Government or its agencies or instrumentalities) company under the 1940 Act.
if, immediately after and as a result of such
investment, (a) more than 5% of the value of the (2) Invest more than 25% of its assets in
fund's total assets would be invested in securities of one or more issuers conducting
securities of the issuer; (b) the fund would hold their principal business activities in the same
more than 10% of the voting securities of the industry. For purposes of this restriction the
the issuer; or (c) more than 25% of the value of electric utility, natural gas utility, and
the fund's assets would be invested in a single telephone industries shall be considered
industry (each of the electric utility, natural separate industries.
gas utility, and telephone industries shall be
considered as a separate industry for this
purpose);
</TABLE>
EXPLANATION OF PROPOSAL 3(C). The current restriction combines two separate
concepts - diversification and industry concentration. The proposed change
would split those two concepts into two separate restrictions and update the
language of each to a more modern construction. The first amended restriction
would require the fund to comply with the definition of diversification under
the 1940 Act, which is slightly more flexible than the definition in the fund's
current restriction which applies to 100% of the fund's assets. Under the 1940
Act, a diversified fund is required to comply with the fund's current
restrictions only with respect to 75% of its total assets. This amendment,
therefore, will provide the fund with additional flexibility to invest more
significantly in certain issuers when the adviser determines that an investment
presents a special opportunity for the fund. This change would increase the
risks of investing in the fund because the fund would become more susceptible
to events that effect individual issuers.
<TABLE>
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not: The fund may not:
3(d) (2) Buy or sell real estate in the ordinary (3) Invest in real estate, except that the
course of its business; provided, however, the fund may invest in securities of issuers that
fund may invest in readily marketable debt invest in real estate or interests therein,
securities secured by real estate or interests securities that are secured by real estate or
therein or issued by companies, including real interests therein, securities of real estate
estate investment trusts, which invest in real investment trusts and mortgage-backed
estate or interests therein; securities.
</TABLE>
EXPLANATION OF PROPOSAL 3(D). This restriction has been amended for improved
clarity and uniformity among Pioneer mutual funds but has not been
substantively changed.
<TABLE>
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not: The fund may not:
3(e) (3) By or sell commodities or commodity (4) Invest in commodities or commodity
contracts except interest rate futures contracts, contracts, except that the fund may invest in
options on securities, securities indices, currency instruments and contracts and
currency and other financial instruments, futures financial instruments and contracts that might
contracts on securities, securities indices, be deemed to be commodities and commodity
currency and other financial instruments and contracts.
options on such futures contracts, forward
foreign currency exchange contracts, forward
commitments, securities index put or call
warrants, interest rate swaps, caps and floors
and repurchase agreements entered into in
accordance with the fund's investment policies;
</TABLE>
EXPLANATION OF PROPOSAL 3(E). This restriction has been amended for improved
clarity and uniformity among Pioneer mutual funds but has not been
substantively changed.
<TABLE>
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not: The fund may not:
3(f) (4) Underwrite any issue of securities; (5) Act as an underwriter, except as it
may be deemed to be an underwriter in a sale
of restricted securities held in its portfolio.
</TABLE>
EXPLANATION OF PROPOSAL 3(F). This restriction has been amended for improved
clarity and uniformity among Pioneer mutual funds but has not been
substantively changed.
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not: The fund may not:
3(g) (5) Make loans in an aggregate amount in (6) Make loans, except by the purchase of
excess of 10% of the value of the fund's total debt obligations, by entering into repurchase
assets, taken at the time any loan is made, agreements or through the lending of portfolio
provided that (I) the purchase of debt securities securities.
pursuant to the fund's investment objectives
shall not be deemed loans for the purposes of
this restriction, (ii) loans of portfolio
securities as described, from time to time, under
"Lending of Portfolio Securities" shall be made
only in accordance with the terms and conditions
therein set forth and (iii) in seeking a return
on temporarily available cash, the fund may
engage in repurchase transactions maturing in one
week or less and involving obligations of the
U.S. Government, its agencies or
instrumentalities.
</TABLE>
EXPLANATION OF PROPOSAL 3(G). This restriction has been amended for improved
clarity and uniformity among Pioneer mutual funds but has not been
substantively changed.
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not:
3(h) (6) Sell securities short, except to the ELIMINATE AS FUNDAMENTAL AND RECLASSIFY AS A
extent that the fund contemporaneously owns or NON-FUNDAMENTAL INVESTMENT POLICY OR
has the right to acquire at no additional cost RESTRICTION.
securities identical to those sold short.
</TABLE>
EXPLANATION OF PROPOSAL 3(H). The 1940 Act does not require that this
restriction be fundamental. This restriction would continue to be a fund policy
but would be reclassified as non-fundamental.
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not:
3(i) (7) Purchase securities on margin. ELIMINATE AS FUNDAMENTAL AND RECLASSIFY AS A
NON-FUNDAMENTAL INVESTMENT POLICY OR
RESTRICTION.
</TABLE>
EXPLANATION OF PROPOSAL 3(I). The 1940 Act does not require that this
restriction be fundamental.
<TABLE>
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not: The fund may not:
3(j) (8) Borrow money, except that, as a (7) Borrow money, except the fund may: (a)
temporary measure for extraordinary or emergency borrow from banks or through reverse repurchase
purposes and not for investment purposes, the agreements in an amount up to 33 1/3% of the
fund may borrow up to 5% of the value of its fund's total assets (including the amount
total assets at the time of the borrowing; borrowed); (b) to the extent permitted by
applicable law, borrow up to an additional
5% of the fund's assets for temporary purposes;
(c) obtain such short-term credits as are
necessary for the clearance of portfolio transactions;
(d) the fund may 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.
</TABLE>
EXPLANATION OF PROPOSAL 3(J). This restriction has been amended for improved
clarity and uniformity among Pioneer mutual funds. The percentage limitation on
borrowing has been revised upward from 5% to 33 1/3% of the fund's total assets
to conform to the percentage limitation included in the 1940 Act. This change
affords the fund additional flexibility to borrow money if Pioneer determines
that such borrowing is in the best interests of the fund and is consistent both
the fund's investment objective and with the requirements of the 1940 Act.
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PROPOSAL CURRENT FUNDAMENTAL POLICY AMENDED NON-FUNDAMENTAL RESTRICTION
The fund may not:
3(k) (9) Mortgage, pledge, or hypothecate any of ELIMINATE AS A SEPARATE FUNDAMENTAL RESTRICTION.
its assets
</TABLE>
EXPLANATION OF PROPOSAL 3(K). The 1940 Act does not require that this
restriction be fundamental.
BOARD EVALUATION AND RECOMMENDATION
The trustees believe that the proposed amendments to the fund's fundamental
policies and restrictions will more clearly reflect current regulatory practice
and will expand the investment opportunities available to the fund. Accordingly,
the trustees recommend that you approve the proposals to changes as described
above. If the required approval of a change to a policy or restriction is not
obtained, the current investment policy or restriction will continue in effect.
THE TRUSTEES OF YOUR FUND RECOMMEND THAT THE SHAREHOLDERS OF YOUR FUND VOTE FOR
THE PROPOSAL TO AMEND THE FUND'S INVESTMENT RESTRICTIONS.
VOTING RIGHTS AND REQUIRED VOTE
Each share of your fund is entitled to one vote. Approval of each proposal
requires the affirmative vote of a majority of the shares of your fund
outstanding and entitled to vote. For this purpose, a majority of the
outstanding shares of your fund means with respect to each proposal the vote of
the lesser of
(1) 67% or more of the shares present at the meeting, if the holders of more
than 50% of the shares of the fund are present or represented by proxy, or
(2) more than 50% of the outstanding shares of the fund.
INFORMATION CONCERNING THE MEETING
OUTSTANDING SHARES AND QUORUM
As of February 26, 1998, _____________ Class A shares _____________ Class B and
__________ Class C shares of beneficial interest of the fund were outstanding.
Only shareholders of record on March 5, 1999 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 February 26, 1999, the following persons
owned of record or beneficially 5% or more of the outstanding Class A, Class B
and Class C shares of your fund.
<PAGE>
[WILL NEED TO INSERT TABLE OF 5% AND SHAREHOLDERS HERE]
SHAREHOLDER PROPOSALS
Your fund is not required to hold annual meetings of shareholders and does not
currently intend to hold a meeting of shareholders in 2000.
SHARES HELD IN RETIREMENT PLANS
PGI, as trustee or custodian of certain retirement plans, is permitted to vote
any shares held in such plans and will do so if necessary to obtain a quorum.
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 meeting will not revoke a proxy, a
shareholder present at the meeting may withdraw his or her proxy and vote in
person. All properly executed and unrevoked proxies received in time for the
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 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 meeting 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 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, have
not been received, the persons named as proxies may propose one or more
adjournments of the 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 trust present in person or by proxy
at the session of the 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 your 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 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 in accordance with clause (1) above, if more
than 50% of the outstanding shares (excluding the "broker non-votes") are
present or represented. However, for purposes of determining whether a proposal
has been adopted in accordance with clause (2) above, 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.
OTHER BUSINESS
While the 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 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 Pioneer. In addition to soliciting proxies by mail,
Pioneer may, at Pioneer's 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 in record by such persons.
The fund may also arrange to have votes recorded by telephone. The telephone
voting procedure is 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.
The fund has been advised by counsel that these procedures are consistent with
the requirements of applicable law. If these procedures were subject to a
successful legal challenge, such votes would not be counted at the meeting. The
fund is unaware of any such challenge at this time. Shareholders would be called
at the phone number PSC 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. 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 Pioneer, upon request,
for the reasonable expenses of mailing soliciting materials to the principals of
the accounts.
March 9, 1999
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION is made as of the [1st] day
of [April], 1999, by and between Pioneer Bond Fund, a Massachusetts business
trust (the "Current Trust"), and Pioneer Bond Fund, a business trust duly formed
under the laws of the State of Delaware (the "Successor Trust").
This Agreement is intended to be and is adopted as a plan of
reorganization within the meaning of Section 368 (a)(1) of the U.S. Internal
Revenue Code of 1986, as amended (the "Code"), and is intended to effect the
conversion of the Current Trust into a Delaware business trust.
In consideration of the premises and of the covenants and agreements
hereinafter set forth the parties hereto covenant and agree as follows.
1. TRANSFER OF ASSETS OF THE CURRENT TRUST IN EXCHANGE FOR ASSUMPTION OF
LIABILITIES AND ISSUANCE OF SHARES OF THE SUCCESSOR TRUST; DISSOLUTION
OF THE CURRENT TRUST
1.1 Subject to the terms and conditions set forth herein and on the
basis of the representations and warranties contained herein, the Current Trust
agrees to transfer all of its assets set forth in paragraph 1.2 and assign and
transfer all of its liabilities to the Successor Trust established solely for
the purpose of acquiring all of the assets and assuming all of the liabilities
of the Current Trust. As of the date of this Agreement, the Successor Trust has
not issued any shares of beneficial interest or commenced operations, other than
such shares as may be issued to Pioneer Investment Management, Inc. ("Pioneer
Investments") or one of its affiliates to establish the necessary minimum
capitalization for registration with the Securities and Exchange Commission
("SEC"). The Successor Trust agrees that in exchange for all of the assets of
the Current Trust (1) the Successor Trust shall assume all of the liabilities of
the Current Trust, whether contingent or otherwise, then existing and (2) the
Successor Trust shall deliver to the Current Trust the number of full and
fractional of each Class of the Successor Trust (the "Successor Trust Shares")
equal to the number of each class of Current Trust Shares then outstanding, it
being intended that the value of the Successor Trust Shares collectively shall
be equal to the value of the assets of the Current Trust transferred to, less
the liabilities of Current Trust assumed by, the Successor Trust (the "Net
Assets"), as described in paragraph 3.1 on the Closing Date provided for in
paragraph 3.1. Such transactions shall take place at the Closing provided for in
paragraph 3.1.
1.2 The assets of the Current Trust to be acquired by the Successor
Trust shall include, without limitation, all cash, cash equivalents, securities,
receivables (including interest and dividends receivable), any claims or rights
of action or rights to register shares under applicable securities laws, any
books or records of the Current Trust and other property owned by the Current
Trust and any deferred or prepaid expenses shown as assets on the books of the
Current Trust on the Closing Date provided for in paragraph 3.1.
1.3 Immediately upon delivery to the Current Trust of Successor Trust
Shares of the Successor Trust, any duly authorized officer of such as the then
sole shareholder of the Successor Trust shall (i) elect as Trustees of the
Successor Trust the persons who currently serve as Trustees of the Current
Trust; (ii) ratify the selection of the independent accountants; (iii) approve a
management contract for the Successor Trust with Pioneer Investments in the form
most recently approved for the Current Trust; and (iv) adopt the investment
objectives, investment policies and investment restrictions of the Current
Trust.
1.4 As provided in paragraph 3.4, on the Closing Date, the Current
Trust will distribute in liquidation to its shareholders of record ("Current
Trust Shareholders"), determined as of the close of business on the Closing
Date, the Successor Trust Shares of each class received from the Successor Trust
PRO RATA in proportion to their respective shares of beneficial interest of such
class in the Current Trust ("Current Trust Shares"), in exchange for such
Current Trust Shares. Such distribution will be accomplished by the transfer of
the Successor Trust Shares then credited to the account of the Current Trust on
the share records of the Successor Trust to open accounts on those records in
the names of such Current Trust Shareholders and representing the respective PRO
RATA number of the Successor Trust Shares of each class received from the
Successor Trust due such Current Trust Shareholders. The Successor Trust shall
not issue certificates representing Successor Trust Shares in connection with
such distributions. Fractional Successor Trust Shares shall be rounded to the
third place after the decimal point.
1.5 As soon as practicable after the distribution of the Successor
Trust Shares as set forth in Section 1.4, the Current Trust shall be terminated
and any such further actions shall be taken in connection therewith as are
required by applicable law.
1.6 Ownership of the Successor Trust Shares by each Successor Trust
Shareholder shall be maintained separately on the books of Pioneering Services
Corporation as the shareholder services and transfer agent for the Successor
Trust.
1.7 Any transfer taxes payable upon issuance of Successor Trust Shares
in a name other than the registered holder of the Current Trust Shares on the
books of the Current Trust as of that time shall be paid by the person to whom
such Successor Trust Shares are to be distributed as a condition of such
transfer.
1.8 The Current Trust Shareholders holding certificates representing
their ownership of shares of beneficial interest of the Current Trust shall
surrender such certificates or deliver an affidavit with respect to lost
certificates, in such form and accompanied by such surety bonds as the Current
Trust may require (collectively, an "Affidavit"), to the Current Trust prior to
the Closing Date. Any Current Trust certificate which remains outstanding on the
Closing Date shall be deemed to be cancelled, shall no longer evidence ownership
of shares of beneficial interest of the Current Trust and shall not evidence
ownership of the Successor Trust Shares. Unless and until any such certificate
shall be so surrendered or an Affidavit relating thereto shall be delivered,
dividends and other distributions payable by the Successor Trust subsequent to
the Closing Date with respect to Current Trust Shares shall be paid to the
holder of such certificate(s), but such shareholders may not redeem or transfer
Current Trust Shares received in the Reorganization.
2. VALUATION
2.1 The value of the Net Assets of the Current Trust to be acquired
hereunder by the Successor Trust shall be the net asset value computed as of the
valuation time provided in the then current prospectus of the Current Trust on
the Closing Date using the valuation procedures set forth in the then current
prospectus or statement of additional information.
2.2 The value of full and fractional Successor Trust Shares of the
Successor Trust to be issued in exchange for the Net Assets of each of the
Current Trust shall be equal to the value of such Net Assets on the Closing
Date, and the number of such Successor Trust Shares of each class to be issued
by the Successor Trust shall equal the number of full and fractional Current
Trust Shares of each class of the Current Trust on the Closing Date.
2.3 All computations of value shall be made by Pioneering Services
Corporation as custodian for the Current Trust and the Successor Trust.
3. CLOSING AND CLOSING DATE
3.1 The transfer of the assets of the Current Trust in exchange for the
assumption by the Successor Trust of the liabilities of the Current Trust and
the issuance of Successor Trust Shares to the Current Trust, as described above,
together with related acts necessary to consummate such acts (the "Closing"),
shall occur at the offices of Hale and Dorr LLP at 60 State Street, Boston,
Massachusetts 02109 on April, 1999 ("Closing Date"), or at such other place or
date on or prior to December 31, 1999 as the parties may agree in writing. All
acts taking place at the Closing shall be deemed to take place simultaneously as
of the last daily determination of the net asset value of the Current Trust or
at such other time and or place as the parties may agree.
3.2 In the event that on the Closing Date (a) the New York Stock
Exchange is closed to trading or trading thereon is restricted or (b) trading or
reporting of trading on said Exchange or in any market in which portfolio
securities of the Current Trust are traded is disrupted so that accurate
appraisal of the value of the Net Assets of the Current Trust is impracticable,
the Closing shall be postponed until the first business day upon which trading
shall have been fully resumed and reporting shall have been restored.
3.3 The Current Trust shall deliver at the Closing a certificate or
separate certificates of an authorized officer stating that it has notified the
Custodian, as custodian for the Current Trust and the Successor Trust, of the
conversion of the Current Trust to the Successor Trust.
3.4 Pioneering Services Corporation, as shareholder services and
transfer agent for the Current Trust, shall deliver at the Closing certificates
as to the conversion on its books and records of the accounts of the
shareholders of the Current Trust to accounts as holders of shares of the
Successor Trusts. The Successor Trust shall issue and deliver to the Current
Trust a confirmation evidencing the shares of Successor Trust to be credited on
the Closing Date or provide evidence satisfactory to the Current Trust that such
shares of the Successor Trust have been credited to the account of Current Trust
on the books of the Successor Trust. At the Closing each party shall deliver to
the other such bills of sale, checks, assignments, share certificates, receipts
or other documents as such other party or its counsel may reasonably request.
3.5 Portfolio securities that are not held in book-entry form in the
name of the Custodian as record holder for the Current Trust shall be presented
by the Current Trust to the Custodian for examination no later than five
business days preceding the Closing Date. Portfolio securities which are not
held in book-entry form shall be delivered by the Current Trust to the Custodian
for the account of the Successor Trust 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
Custodian in book-entry form on behalf of the Current Trust shall be delivered
to the Successor Trust by the Custodian by recording the transfer of beneficial
ownership thereof on its records. The cash of the Current Trust to be delivered
shall be in the form of currency or by the Custodian crediting the Successor
Trust's account maintained with the Custodian with immediately available funds.
4. REPRESENTATIONS AND WARRANTIES
4.1 The Current Trust represents and warrants as follows:
4.1.A. The Current Trust is a business trust duly authorized
to exist 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
shareholders of the Current Trust, to perform its obligations under this
Agreement. The Current Trust is not required to qualify to do business in any
jurisdiction in which it is not so qualified or where failure to qualify would
not subject it to any material liability or disability. The Current Trust 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;
4.1.B. The Current Trust is a registered investment company
classified as a management company of the open-end diversified type and its
registration with the SEC as an investment company under the Investment Company
Act of 1940, as amended (the "1940 Act"), is in full force and effect;
4.1.C. The Current Trust is not, and the execution, delivery
and performance of this Agreement will not result, in violation of any provision
of its Declaration of Trust or By-laws, or any agreement, indenture, instrument,
contract, lease or other undertaking to which the Current Trust is a party or by
which the Current Trust is bound;
4.1.D. The Current Trust has no material contracts or other
commitments (other than this Agreement or agreements for the purchase of
securities entered into in the ordinary course of business and consistent with
its obligations under this Agreement) that will not be terminated without
liability to the Current Trust on or prior to the Closing Date;
4.1.E. No material litigation or administrative proceeding or
investigation of or before any court or governmental body presently is pending
or threatened against the Current Trust or any of its properties or assets. The
Current Trust knows of no facts that might form the basis for the institution of
such proceedings and the Current Trust is not a party to, or subject to, the
provisions of any order, decree or judgment of any court or governmental body
that materially and adversely affects its business or its ability to consummate
the transactions herein contemplated;
4.1.F. At the date hereof and at the Closing Date, all
federal, state and other tax returns and reports, including information returns
and payee statements, of the Current Trust required by law to have been filed or
furnished by such dates shall have been filed or furnished and all federal,
state and other taxes, interest and penalties shall have been paid so far as due
or provision shall have been made for the payment thereof and no such return is
currently under audit and no assessment has been asserted with respect to any of
such returns or reports;
4.1.G. The Current Trust has elected that it be treated as a
regulated investment company under Subchapter M of the Code, has qualified as
such for each taxable year since its inception, and will qualify as such as of
the Closing Date;
4.1.H. The authorized capital of the Current Trust consists of
an unlimited number of shares of beneficial interest, no par value, divided into
four classes (Class A, Class B, Class C and Class Y) of one series. All issued
and outstanding shares of beneficial interest of the Current Trust are, and at
the Closing Date will be, duly and validly issued and outstanding, fully paid
and nonassessable. The Current Trust does not have outstanding any options,
warrants or other rights to subscribe for or purchase any of its shares of
beneficial interest, nor is there outstanding any security convertible into any
of its shares of beneficial interest;
4.1.I. The information to be furnished by the Current Trust
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 and shall comply in all
material respects with federal securities and other laws and regulations
thereunder applicable thereto;
4.1.J. All of the issued and outstanding Current Trust Shares
will at the time of the Closing be held by the persons and in the amounts as, on
behalf of the Current Trust, certified in accordance with the provisions of
paragraph 3.4;
4.1.K. At the Closing Date, the Current Trust will have good
and marketable title to the assets to be transferred to the Successor Trust
pursuant to paragraph 1.1, and full right, power and authority to sell, assign,
transfer and deliver such assets hereunder, and upon delivery and in payment for
such assets, the Successor Trust will acquire good and marketable title thereto
subject to no restrictions on the full transfer thereof, including such
restrictions as might arise under the Securities Act of 1933, as amended (the
"1933 Act), except as otherwise disclosed in writing and accepted by the
Successor Trust;
4.1.L. The execution, delivery and performance of this
Agreement will have been duly authorized prior to the Closing Date by all
necessary action on the part of the Current Trust and this Agreement constitutes
a valid and binding obligation of the Current Trust enforceable in accordance
with its terms, subject to the approval of the Current Trust's shareholders;
4.1.M. No consent, approval, authorization or order of any
court or governmental authority is required for the consummation by the Current
Trust of the transactions contemplated herein, except such as shall have been
obtained prior to the Closing Date.
4.2 The Successor Trust represents and warrants as follows:
4.2.A. The Successor Trust is a business trust duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has the power to own all of its properties and assets and to perform its
obligations under this Agreement; the Successor Trust is not required to qualify
to do business in any jurisdiction in which it is not so qualified or where
failure to qualify would not subject it to any material liability or disability;
the Successor Trust 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; that as of the date hereof and as of the Closing Date, the Successor
Trust consists of one duly established and designated series;
4.2.B. The Successor Trust is not, and the execution, delivery
and performance of this Agreement will not result, in violation of any provision
of the Certificate of Trust, Agreement and Declaration of Trust or By-laws of
the Successor Trust or any agreement, indenture, instrument, contract, lease or
other undertaking to which the Successor Trust is a party or by which the
Successor Trust is bound;
4.2.C. No material litigation or administrative proceeding or
investigation of or before any court or governmental body is presently pending
or threatened against the Successor Trust or any of its properties or assets.
The Successor Trust knows of no facts that might form the basis for the
institution of such proceedings, and the Successor Trust is not a party to, or
subject to, the provisions of any order, decree or judgment of any court or
governmental body that materially and adversely affects its business or its
ability to consummate the transactions herein contemplated;
4.2.D. The Successor Trust intends to qualify as a regulated
investment company under Subsection M of the Code for the taxable year in which
the Closing occurs and to continue to qualify as such for each taxable year;
4.2.E. Other than such shares as may be issued to Pioneer
Investments or one of its affiliates to establish the necessary minimum
capitalization for registration with the SEC, prior to the Closing Date, there
shall be no issued and outstanding Successor Trust Shares or any other
securities of the Successor Trust; Successor Trust Shares issued in connection
with the transactions contemplated herein will be duly and validly issued and
outstanding and fully paid and non-assessable;
4.2.F. The execution, delivery and performance of this
Agreement has been duly authorized by all necessary action on the part of the
Successor Trust and, this Agreement constitutes a valid and binding obligation
of the Successor Trust enforceable against the Successor Trust in accordance
with its terms;
4.2.G. The information to be furnished by the Successor Trust
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 and shall comply in all
material respects with Federal securities and other laws and regulations
applicable thereto;
4.2.H. No consent, approval, authorization or order of any
court or governmental authority is required for the consummation by the
Successor Trust of the transactions contemplated herein, except such as shall
have been obtained prior to the Closing Date.
5. COVENANTS OF THE CURRENT TRUST AND THE SUCCESSOR TRUST
5.1 The Current Trust covenants that the Successor Trust Shares are not
being acquired for the purpose of making any distribution thereof, other than in
accordance with the terms of this Agreement.
5.2 The Current Trust covenants that it will assist the Successor Trust
in obtaining such information as the Successor Trust may reasonably request
concerning the beneficial ownership of Current Trust Shares.
5.3 The Current Trust will, from time to time, as and when requested by
the Successor Trust execute and deliver, or cause to be executed and delivered,
all such assignments and other instruments, and will take or cause to be taken
such further action, as the Successor Trust may deem necessary or desirable in
order to vest in, and confirm to, the Successor Trust, title to, and possession
of, all the assets of the Current Trust to be sold, assigned, transferred and
delivered to the Successor Trusts hereunder and otherwise to carry out the
intent and purpose of this Agreement.
5.4 The Successor Trust will, from time to time, as and when requested
by the Current Trust, execute and deliver or cause to be executed and delivered
all such assignments and other instruments, and will take or cause to be taken
such further action, as the Current Trust may deem necessary or desirable in
order to vest in, and confirm to, the Current Trust, title to, and possession
of, the Successor Trust Shares issued, sold, assigned, transferred and delivered
hereunder and otherwise to carry out the intent and purpose of this Agreement.
5.5 The Successor Trust shall use all reasonable efforts to obtain the
approvals and authorizations required by the 1933 Act, the 1940 Act and such
state securities laws as it may deem appropriate in order to operate after the
Closing Date.
5.6 Subject to the provisions of this Agreement, the Successor Trust
and the Current Trust each will take, or cause to be taken, all action and will
do or cause to be done all things reasonably necessary, proper or advisable to
consummate and make effective the transactions contemplated by this Agreement.
5.7 As promptly as practicable, but in any event within 60 days after
the Closing Date, the Current Trust shall furnish to the Successor Trust, in
such form as is reasonably satisfactory to Successor Trust, a statement of the
earnings and profits of the Current Trust for federal income tax purposes, and
of any capital loss carryovers and other items that will be carried over to the
Successor Trust as a result of Section 381 of the Code, and which statement will
be certified by the President or Treasurer of Current Trust. The Current Trust
covenants that it has no earnings and profits that were accumulated by it or any
other entity during a taxable year when it or such entity did not qualify as a
regulated investment company under the Code or, if it has such earnings and
profits, that it will distribute them to its shareholders prior to the Closing
Date.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE CURRENT TRUST
The obligations of the Current Trust to consummate the transactions
provided for herein shall be subject to the performance by the Successor Trust
of all the obligations to be performed by the Successor Trust hereunder on or
before the Closing Date and, in addition thereto, to the following further
conditions:
6.1 All representations and warranties of the Successor Trust contained
in this Agreement shall be true and correct in all material respects 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, and
6.2 The Successor Trust shall have delivered on the Closing Date to the
Current Trust a certificate executed in Successor Trust's name by its President
or Vice President, in form and substance satisfactory to the Current Trust,
dated as of the Closing Date, to the effect that the representations and
warranties of the Successor 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, and as to such other matters as the Current
Trust shall reasonably request.
Each of the foregoing conditions precedent may be waived by the Current
Trust.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SUCCESSOR TRUST
The obligations of the Successor Trust to consummate the transactions
provided for herein shall be subject to the performance by the Current Trust of
all the obligations to be performed hereunder on or before the Closing Date and,
in addition thereto, to the following further conditions:
7.1 All representations and warranties of the Current Trust contained
in this Agreement shall be true and correct in all material respects 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 Current Trust shall have delivered to the Successor Trust on
the Closing Date a statement of its assets and liabilities, prepared in
accordance with generally accepted accounting principles consistently applied,
together with a certificate of the Treasurer or Assistant Treasurer of the
Current Trust as to the portfolio securities of the Current Trust and the
federal income tax basis and holding period for each such portfolio security as
of the Closing Date; and
7.3 The Current Trust shall have delivered to the Successor Trust on
the Closing Date a certificate executed in the name of the Current Trust by its
President or Vice President, in form and substance satisfactory to the Successor
Trust, dated as of the Closing Date, to the effect that the representations and
warranties 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, and as to such other matters as the Successor Trust shall reasonably
request.
Each of the foregoing conditions precedent may be waived by the
Successor Trust.
8. FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE CURRENT TRUST AND
THE SUCCESSOR TRUST
The obligations of the Current Trust and the Successor Trust are
subject to the further conditions that on or before the Closing Date:
8.1 This Agreement and the transactions contemplated herein shall have
been approved by the requisite vote of each of shareholders of the Current Trust
in accordance with applicable law;
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 to obtain damages or other relief in connection with,
the transactions contemplated hereby;
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 securities authorities) deemed necessary by the
Successor Trust or the Current Trust 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 the
Successor Trust or the Current Trust, provided that either party hereto may for
itself waive any of such conditions;
8.4 The President or Vice President of the Successor Trust shall have
delivered a certificate to the Current Trust on the Closing Date certifying that
the Successor Trust has taken all necessary action so that it shall be a
registered open-end investment company under the 1940 Act.
8.5 The Current Trust and the Successor Trust shall have received on or
before the Closing Date an opinion of Hale and Dorr LLP satisfactory to the
Current Trust and the Successor Trust, substantially to the effect that for
federal income tax purposes:
8.5.A. The acquisition of all of the assets of the Current
Trust by the Successor Trust solely in exchange for the issuance of
Successor Trust Shares to the Current Trust and the assumption by the
Successor Trust of all of the liabilities of the Current Trust,
followed by the distribution in liquidation by the Current Trust of
Successor Trust Shares to the shareholders of in exchange for their
shares of the Current Trust and the dissolution of the Current Trust,
will constitute a reorganization within the meaning of Section
368(a)(1) of the Code, and the Current Trust and the Successor Trust
will each be "a party to a reorganization" within the meaning of
Section 368(b) of the Code;
8.5.B. No gain or loss will be recognized by the Current Trust
upon (i) the transfer of all of its assets to the Successor Trust
solely in exchange for the issuance of Successor Trust Shares to the
Current Trust and the assumption by the Successor Trust of the
liabilities of the Current Trust and (ii) the distribution by the
Current Trust of such Successor Trust Shares to the shareholders of the
Current Trust;
8.5.C. No gain or loss will be recognized by the Successor
Trust upon receipt of all of the assets of the Current Trust solely in
exchange for the issuance of the Successor Trust Shares to the Current
Trust and the assumption by the Successor Trust of all of the
liabilities of the Current Trust;
8.5.D. The tax basis of the assets of the Current Trust in the
hands of the Successor Trust will be, in each instance, the same as the
tax basis of those assets in the hands of the Current Transfer
immediately before the transfer;
8.5.E. The tax holding period of the assets of the Current
Trust in the hands of the Successor Trust will, in each instance,
include the tax holding period of the Current Trust;
8.5.F. Current Trust Shareholders will not recognize gain or
loss upon the exchange of all of their shares of the Current Trust
solely for Successor Trust Shares as part of the transaction;
8.5.G. The tax basis of the Successor Trust Shares received by
Current Trust Shareholders in the transaction will be the same as the
tax basis of the shares of the Current Trust surrendered in exchange
therefor; and
8.5.H. The tax holding period of the Successor Trust Shares
received by Current Trust Shareholders will include, for each
shareholder, the tax holding period for the Current Trust Shares
surrendered in exchange therefor, provided that such Current Trust
Shares were held as capital assets on the date of the exchange.
The Current Trust and the Successor Trust each agree to make and
provide representations with respect to the Current Trust and the Successor
Trust which are reasonably necessary to enable Hale and Dorr LLP to deliver an
opinion substantially as set forth in this paragraph 8.5, which opinion may
address such other federal income tax consequences, if any, that Hale and Dorr
LLP believes to be material to the transaction.
Each of the foregoing conditions precedent to the obligations of a
party, except for the receipt of the opinion of Hale and Dorr LLP set forth in
paragraph 8.5, may be waived by that party.
9. BROKERAGE FEES AND EXPENSES
9.1 The Successor Trust and the Current Trust each represent and
warrant to the other that there are no broker's or finder's fees payable in
connection with the transactions contemplated hereby.
9.2 The Current Trust and the Successor Trust shall each be liable for
its own expenses incurred in connection with entering into and carrying out the
provisions of this Agreement whether or not the transactions contemplated hereby
are consummated; if the transactions are consummated, such expenses of the
Current Trust will be assumed by the Successor Trust as part of the transaction.
10. ENTIRE AGREEMENT
The Successor Trust and the Current Trust agree that neither party has
made any representation, warranty or covenant not set forth herein and that this
Agreement constitutes the entire agreement between the parties. The
representations, warranties and covenants contained herein or in any document
delivered pursuant hereto or in connection herewith shall survive the
consummation of the transactions contemplated hereunder.
11. TERMINATION
11.1 This Agreement may be terminated by the mutual agreement of the
Successor Trust and the Current Trust. In addition, either the Successor Trust
or the Current Trust may at its option terminate this Agreement at or prior to
the Closing Date because:
11.1.A. There exists a material breach by the other party of
any representations, warranties or agreements contained herein to be
performed at or prior to the Closing Date; or
11.1.B. A condition herein expressed to be precedent to the
obligations of the terminating party has not been met and it reasonably
appears that it will not or cannot be met.
11.2 In the event of any such termination, there shall be no liability
for damages on the part of the Successor Trust or the Current Trust, or their
respective trustees or officers, to the other party or its trustees or officers.
12. AMENDMENT
This Agreement may be amended, modified or supplemented in such manner
as may be mutually agreed upon in writing by the parties; provided, however,
that following the approval of this Agreement by Current Trust Shareholders, no
such amendment may have the effect of changing the provisions for determining
the number of Successor Trust Shares to be paid to Current Trust Shareholders
under this Agreement to the detriment of Current Trust Shareholders without
their further approval.
13. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
13.1 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.
13.2 This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original.
13.3 This Agreement shall be governed by and construed in accordance
with the laws of The Commonwealth of Massachusetts.
13.4 This Agreement shall be binding upon 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 any party without the written consent of the other party. Nothing herein
expressed or implied is intended or shall be construed to confer upon or give
any person, firm or corporation other than the parties hereto and their
respective successors and assigns any rights or remedies under or by reason of
this Agreement.
13.5 All persons dealing with the Current Trust and the Successor Trust
must look solely to the property of the Current Trust and the Successor Trust
for the enforcement of any claims against such Trust as neither the Trustees,
officers, agents or shareholders of either Trust assume any personal liability
for obligations entered into on behalf of the Current Trust and the Successor
Trust.
13.6 A copy of the Agreement and Declaration of Trust of the Current
Trust is on file with the Secretary of State of The Commonwealth of
Massachusetts, and notice is hereby given that this instrument is executed on
behalf of the Trustees of the Current Trust as trustees and not individually and
that the obligations of this instrument are not binding upon any of the
trustees, officers, or shareholders of the current Trust individually, but are
binding only upon the assets and property of the Current Trust.
14. 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 Current Trust or the
Successor Trusts, each at 60 State Street, Boston, Massachusetts 02109,
Attention: Secretary.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed by its duly authorized officer.
PIONEER BOND FUND,
a Massachusetts business trust,
By:_________________________________
Its:_________________________________
PIONEER BOND FUND,
a Delaware business trust
By:__________________________________
Its:__________________________________
<PAGE>
FORM OF PROXY CARD [FRONT]
[landscape oriented on proxy card]
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PROXY
PIONEER BOND FUND
PROXY TABULATOR
P.O BOX 9138
HINGHAM, MA 02043
The undersigned holder of shares of beneficial interest of Pioneer Bond
Fund hereby constitutes and appoints Joseph P. Barri, John F. Cogan, Jr., Robert
P. Nault and David D. Tripple, and each of them singly, proxies and attorneys of
the undersigned, with full power of substitution to each, for and in the name of
the undersigned, to vote and act upon all matters at the special meeting of
shareholders of the fund to be held on Tuesday. May 4, 1999 at the offices of
Hale and Dorr LLP, 60 State Street, Boston, Massachusetts, at 2:00 p.m., eastern
time, and at any and all adjournments thereof, relating to all shares of the
fund held by the undersigned or relating to all shares of the fund held by the
undersigned which the undersigned would be entitled to vote or act with all the
powers the undersigned would possess if personally present. All proxies
previously given by the undersigned relating to the meeting are hereby revoked.
ITEM 1: To elect the nine (9) trustees to serve on the board of trustees until
their successors have been duly elected and qualified. The nominees are:
John F. Cogan, Jr., Mary K. Bush, Richard H. Egdahl, M.D., Margaret B.W.
Graham, John W. Kendrick, Marguerite A. Piret, David D. Tripple,
Stephen K. West and John Winthrop.
[ ] FOR ELECTING ALL OF THE NOMINEES [ ] WITHHOLD AUTHORITY TO VOTE FOR
(EXCEPT AS MARKED TO THE CONTRARY) ALL NOMINEES
To withhold authority to vote for one or more of the nominees, write the
nominee(s) name(s) on the line below:
- ---------------------------------------
ITEM 2: To approve an Agreement and Plan of Reorganization pursuant to which
your fund, which is currently organized as a Massachusetts business trust, would
be reorganized as a Delaware business trust
[ ] FOR [ ] AGAINST [ ] ABSTAIN
ITEMS 3(A)-(K): To amend the fund's fundamental investment policies and
restrictions.
[ ] FOR ALL [ ] AGAINST ALL [ ] FOR ALL EXCEPT
If you do not wish to direct the voting of your shares "For" a particular
proposed change, mark the "For All Except" box and check the "Against" box next
to the proposed change(s) listed below. Your shares will be voted "For" the
remaining proposed changes.
<TABLE>
<S> <C>
ITEM 3(A): To eliminate the fund's fundamental policy with respect to rating [] AGAINST
criteria for debt securities and amend and reclassify the policy as
non-fundamental.
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(B): To eliminate the fund's fundamental policy with respect to investing [] AGAINST
in foreign securities and amend and reclassify the policy as
non-fundamental.
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(C): To amend the fund's investment restriction on portfolio [] AGAINST
diversification and concentration.
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(D): To amend the fund's investment restriction on investing in real estate. [] AGAINST
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(E): To amend the fund's investment restriction on investming in commodities. [] AGAINST
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(F): To amend the fund's investment restriction on underwriting securities. [] AGAINST
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(G): To amend the fund's investment restriction on making loans. [] AGAINST
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(H): To eliminate the fund's fundamental investment restriction on selling [] AGAINST
securities short and reclassify the restriction as non-fundamental.
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(I): To eliminate the fund's fundamental investment restriction on [] AGAINST
purchasing securities on margin and reclassify the restriction as
non-fundamental.
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(J): To amend the fund's investment restriction on borrowing. [] AGAINST
- -------------------------------------------------------------------------------------------------- -----------------
ITEM 3(K): To eliminate the fund's investment restriction on pledging assets. [] AGAINST
- -------------------------------------------------------------------------------------------------- -----------------
</TABLE>
<PAGE>
FORM OF PROXY CARD [REVERSE]
- -------------------------------------------------------------------------------
SPECIFY YOUR DESIRED ACTION BY CHECK MARKS IN THE APPROPRIATE SPACE.
THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO SPECIFICATION IS MADE, THE PROXY
WILL BE VOTED IN FAVOR OF EACH ITEM. THE PERSONS NAMED AS PROXIES HAVE
DISCRETIONARY AUTHORITY WHICH THEY INTEND TO EXERCISE IN FAVOR OF THE PROPOSALS
REFERRED TO AND ACCORDING TO THEIR BEST JUDGMENT AS TO ANY OTHER MATTERS WHICH
PROPERLY COME BEFORE THE MEETING.
<PAGE>
o Please complete, sign, date and return this proxy in the
enclosed envelope as soon as possible.
o Please sign exactly as your name or names appear in the box on the
left. When signing as attorney, executor, administrator, trustee or
guardian, please give your full title as such.
o If a corporation, please sign in full corporate name by president
or other authorized officer.
o If a partnership, please sign in partnership name by authorized
person.
Date ______________________________________________ , 1998
- ----------------------------------------------------------
- ----------------------------------------------------------
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES
