QUALIFYING UNDERWRITER
ADDITIONAL COMPENSATION AGREEMENT
_________________, 2003
Pioneer Investment Management, Inc.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement dated the date
hereof (the "Underwriting Agreement"), by and among Pioneer Municipal High
Income Advantage Trust, a closed-end management investment company (the
"Trust"), Pioneer Investment Management, Inc. ("Pioneer Investment Management"
or the "Investment Adviser") and each of the respective Underwriters named
therein, with respect to the issue and sale of the Trust's common shares of
beneficial interest, no par value (the "Common Shares"), as described therein.
Reference is also made to (i) the Investment Advisory Agreement (the "Investment
Advisory Agreement") to be entered into between the Investment Adviser and the
Trust and (ii) the registration statement on Form N-2 regarding the Common
Shares of the Trust (the "Registration Statement"). Capitalized terms used
herein and not otherwise defined shall have the meanings given to them in the
Underwriting Agreement.
The Investment Adviser hereby confirms its agreement with each
Qualifying Underwriter (as defined in Section 1 hereof) with respect to the
additional compensation referred to in the "Underwriting" section of the
Registration Statement, payable by the Investment Adviser to each of the
Qualifying Underwriters. The Investment Adviser agrees to pay to each Qualifying
Underwriter additional compensation (collectively, the "Additional
Compensation") as provided for in Section 3 hereof; provided, however, that such
Additional Compensation shall not exceed an amount equal to 0.15% per annum of
the aggregate average daily managed assets of the Trust (including assets
attributable to any preferred shares or other financial leverage of the Trust
that may be outstanding); and provided, further, that such payments shall not,
in the aggregate, exceed the "Maximum Additional Compensation Amount" (as
defined in Section 4 hereof). The Additional Compensation shall be payable as
set forth in Section 3 hereof.
SECTION 1. QUALIFYING UNDERWRITERS. For the purposes of this Qualifying
Underwriter Additional Compensation Agreement (the "Additional Compensation
Agreement"), UBS Securities LLC (as lead manager of the Underwriters) and each
Underwriter which sells Common Shares of the Trust with an aggregate purchase
price to the public of at least $50,000,000 shall be a "Class I Qualifying
Underwriter" and [ ] shall be a "Class II Qualifying Underwriter;" PROVIDED,
HOWEVER, that the amount required to qualify as a Class I Qualifying Underwriter
may be reduced with respect to any Underwriter in the sole discretion of the
Investment Adviser (upon consultation with the lead manager of the
Underwriters), and that the Investment Adviser in its sole discretion (upon
consultation with the lead manager of the Underwriters) may classify any
Underwriter as a Class II Qualifying Underwriter. Class I Qualifying
Underwriters and Class II Qualifying Underwriters are referred to collectively
herein as "Qualifying Underwriters." A Qualifying Underwriter which qualifies as
a Class II Qualifying Underwriter shall not also be a Class I Qualifying
Underwriter. Within 60 days following the Closing Date, the Qualifying
Underwriters shall prepare or cause to be prepared and provide to the Investment
Adviser a chart listing each of the Qualifying Underwriters, which chart shall
indicate the aggregate purchase price to the public of the Common Shares sold by
each Qualifying Underwriter and the Pro Rata Percentage (as defined in Section 2
hereof) of each Qualifying Underwriter and shall be appended as Schedule A to
this Additional Compensation Agreement. Such Schedule A shall be prepared in
good faith by the Qualifying Underwriters and subject to verification by the
Investment Adviser.
SECTION 2. PRO RAT A PERCENTAGE. Each Qualifying Underwriter
shall be assigned a "Pro Rata Percentage," the numerator of which shall
equal the aggregate purchase price to the public of the Common Shares sold by
such Underwriter as set forth on Schedule A hereto and the denominator of which
shall equal the aggregate purchase price to the public of all of the Common
Shares purchased by the Underwriters pursuant to the Underwriting Agreement.
SECTION 3. PAYMENT OF ADDITIONAL COMPENSATION.
(a) The Investment Adviser shall pay the Additional Compensation,
quarterly in arrears, to each Class I Qualifying Underwriter in an amount equal
to the product of such Qualifying Underwriter's Pro Rata Percentage multiplied
by 0.0250% of the aggregate average daily managed assets of the Trust for such
quarter (including assets attributable to any preferred shares or other
financial leverage of the Trust that may be outstanding); PROVIDED, HOWEVER,
that in the event that the contractual advisory fee rate payable by the Trust to
the Investment Adviser or such successor or affiliate under the Investment
Advisory Agreement is reduced below 0.60%, the fee payable by the Investment
Adviser to such Qualifying Underwriter shall be reduced in proportion to, and
for the period of, such reduction of the advisory fee, and this agreement shall
be deemed to be amended automatically to reflect the same.
(b) The Investment Adviser shall pay the Additional Compensation,
quarterly in arrears, to each Class II Qualifying Underwriter in an amount equal
to the product of such Qualifying Underwriter's Pro Rata Percentage multiplied
by 0.0375% of the aggregate average daily managed assets of the Trust for such
quarter (including assets attributable to any preferred shares or other
financial leverage of the Trust that may be outstanding); PROVIDED, HOWEVER,
that in the event that the contractual advisory fee rate payable by the Trust to
the Investment Adviser or such successor or affiliate under the Investment
Advisory Agreement is reduced below 0.60%, the fee payable by the Investment
Adviser to such Qualifying Underwriter shall be reduced in proportion to, and
for the period of, such reduction of the advisory fee, and this agreement shall
be deemed to be amended automatically to reflect the same.
(c) All fees payable hereunder shall be paid to each Qualifying
Underwriter by wire transfer of immediately available Trusts within 15 days
following the end of each calendar quarter to a bank account designated by such
Qualifying Underwriter. At the time of each payment of Additional Compensation
hereunder, the Investment Adviser shall deliver to each Qualifying Underwriter
receiving an installment of Additional Compensation a statement indicating the
amount of the average daily managed assets of the Trust for such quarter
(including assets attributable to any preferred shares or other financial
leverage of the Trust that may be outstanding) on which such payment was based.
(d) The initial payments of Additional Compensation hereunder shall be
paid with respect to the calendar quarter ending [ ], 2003. In the event that
this Additional Compensation Agreement terminates prior to the end of a calendar
quarter, the Additional Compensation required to be paid hereunder shall be due
and payable within 15 days following the termination hereof and shall be
pro-rated in respect of the period prior to such termination. Notwithstanding
the foregoing, if any payment hereunder would otherwise fall on a day which is
not a business day, it shall be due on the next day which is a business day. All
fees payable hereunder shall be in addition to any fees paid by the Investment
Adviser pursuant to the Underwriting Agreement.
SECTION 4. MAXIMUM ADDITIONAL COMPENSATION AMOUNT. The "Maximum
Additional Compensation Amount" payable by the Investment Adviser hereunder
shall be, with respect to each Qualifying Underwriter, such amount as, when
taken together with the amount of all underwriting compensation other than the
Additional Compensation received by such Underwriter in connection with the
offering of the Common Shares of the Trust, equals the maximum compensation
allowed under the conduct rules of the National Association of Securities
Dealers, Inc. (which we currently understand is 9.00%), as such rules are then
in effect; provided, that in determining when the maximum amount has been paid,
the value of each of the quarterly payments shall be discounted at the annual
rate of 10% to the closing date of the initial offering of the Common Shares.
SECTION 5. TERM. This Additional Compensation Agreement shall
continue coterminously with and so long as the Investment Advisory
Agreement, dated _________________, 2003, remains in effect between the Trust
and Pioneer Investment Management, or any similar investment advisory agreement
with a successor in interest or affiliate of Pioneer Investment Management
remains in effect, as, and to the extent, that such investment advisory
agreement is renewed periodically in accordance with the Investment Company Act
of 1940, as amended. This Additional Compensation Agreement shall terminate on
the earliest to occur of (a) with respect to any Qualifying Underwriter, the
payment by the Investment Adviser to such Qualifying Underwriter of the Maximum
Additional Compensation Amount, (b) with respect to the Trust, the dissolution
and winding up of the Trust and (c) with respect to the Trust, the date on which
the Investment Advisory Agreement or other investment advisory agreement between
the Trust and the Investment Adviser or any successor in interest to the
Investment Adviser, including but not limited to an affiliate of the Investment
Adviser, shall terminate.
SECTION 6. NOT AN INVESTMENT ADVISER. The Investment Adviser
acknowledges that the Underwriters are not providing any advice hereunder
as to the value of securities or regarding the advisability of purchasing or
selling any securities for the Trust. No provision of this Additional
Compensation Agreement shall be considered as creating, nor shall any provision
create, any obligation on the part of any Underwriter, and the Underwriters are
not hereby agreeing, to: (i) furnish any advice or make any recommendations
regarding the purchase or sale of portfolio securities or (ii) render any
opinions, valuations or recommendations of any kind or to perform any such
similar services.
SECTION 7. NOT EXCLUSIVE. Nothing herein shall be construed as
prohibiting any Underwriter or its respective affiliates from acting as
such for any other clients (including other registered investment companies or
other investment advisers).
SECTION 8. NO LIABILITY. The Investment Adviser agrees that no
Underwriter shall have liability to the Investment Adviser or the Trust for
any act or omission to act by such Underwriter in the course of its performance
under this Additional Compensation Agreement, in the absence of gross negligence
or willful misconduct on the part of such Underwriter. The Investment Adviser
agrees to indemnify and hold harmless each Underwriter and its respective
officers, directors, agents and employees against any loss or expense arising
out of or in connection with such Underwriter's performance under this
Additional Compensation Agreement. This provision shall survive the termination,
expiration or supersession of this Additional Compensation Agreement.
SECTION 9. ASSIGNMENT. This Additional Compensation Agreement
may not be assigned by any party without the prior written consent of each
other party.
SECTION 10. AMENDMENT; WAIVER. No provision of this Additional
Compensation Agreement may be amended or waived except by an instrument in
writing signed by the parties hereto.
SECTION 11. GOVERNING LAW. This Additional Compensation
Agreement shall be governed by, and construed in accordance with, the laws of
the State of New York.
SECTION 12. COUNTERPARTS. This Additional Compensation
Agreement may be executed in any number of counterparts, each of which
shall be an original, and all of which, when taken together, shall constitute
one agreement. Delivery of an executed signature page of this Additional
Compensation Agreement by facsimile transmission shall be effective as delivery
of a manually executed counterpart hereof.
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
Pioneer Investment Management and the Qualifying Underwriters in accordance with
its terms.
Very truly yours,
UBS SECURITIES LLC
By:
Name: Xxxxx Xxxxxxxx
Title: Managing Director
By:
Name: Xxxx X. Reit
Title: Executive Director
CONFIRMED AND ACCEPTED, as of the date first above written:
PIONEER INVESTMENT MANAGEMENT, INC.
By:
Name:
Title:
SCHEDULE A
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AGGREGATE
PURCHASE PRICE TO PUBLIC PRO RATA
NAME OF QUALIFYING UNDERWRITER CLASS OF COMMON SHARES SOLD PERCENTAGE
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UBS Securities LLC I
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