MANAGEMENT CONTRACT
THIS AGREEMENT dated this 15th of February, 1985 between Pioneer II, a
Massachusetts business trust, hereinafter called "Pioneer", and Pioneering
Management Corporation, a Delaware corporation, hereinafter called the
"Manager".
Recitals
Pioneer is registered as an open end management investment company
under the Investment Company Act of 1940 and has registered its shares for
public offering under the Securities Act of 1933.
The parties hereto deem it mutually advantageous that the Manager
should assist the Board of Trustees and officers of Pioneer in the management of
the securities portfolio of Pioneer.
Agreements
NOW, THEREFORE, Pioneer and the Manager do hereby agree as follows:
1. The Manager is authorized to buy and sell securities and to
designate brokers to carry out such transactions, subject to a number of
limitations. Pioneer may not:
a. make any purchase the cost of which exceeds Pioneer's currently
available funds;
b. purchase securities "on margin" or effect "short sales" of
securities;
c. underwrite any issue of securities;
d. acquire the securities of any other domestic or foreign
investment company or investment fund (except in connection with
a plan of merger or consolidation with or acquisition of
substantially all the assets of such other investment company);
provided, however, that Pioneer may invest in the securities
issued by a real estate investment trust, provided that such
trust shall not be permitted to invest in real estate or
interests in real estate other than mortgages or other security
interests;
e. purchase securities of a company if the purchase would result in
Pioneer's having more than 5% of the value of its total assets
invested in securities of such company;
f. purchase securities of a company if the purchase would result in
Pioneer's owning more than 10% of the outstanding voting
securities of such company;
g. purchase securities for the purpose of controlling management of
other companies;
h. invest in commodities, commodity contracts, or real estate;
i. purchase "investment letter" securities (i.e. securities that
must be registered under the Securities Act of 1933 before they
may be offered or sold to the public);
j. purchase the securities of any enterprise which has a business
history of less than three years, including the operation of any
predecessor business to which it has succeeded;
k. purchase or retain the securities of any company if those
officers and Trustees of Pioneer, its adviser or principal
underwriter, owning individually more than one-half of 1% of the
securities of such company, together own more than 5% of the
securities of such company;
2. Further, the Manager's discretion is limited by the following
general rules:
a. notice of each purchase or sale of securities for Pioneer's
account shall be forwarded promptly to each Trustee;
b. if any three Trustees disapprove in writing of any transaction
within forty- eight hours after dispatch of such notice, the
Manager shall immediately repurchase or resell the security
involved in such transaction, as the case may be, at the expense
and risk of Pioneer;
c. all transactions will be made at the best price and execution
available.
3. The Manager, at its own expense, shall furnish to Pioneer office
space in the offices of the Manager or in such other place as may be agreed upon
from time to time, and all necessary office facilities, equipment and personnel
for managing the affairs and investments and supervising the keeping of the
books of Pioneer, and shall arrange, if desired by Pioneer, for members of the
Manager's organization to serve as officers or agents of Pioneer. The Manager
assumes and shall pay or reimburse Pioneer for: (1) the compensation (if any) of
the Trustees who are affiliated with,
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or interested persons of, Manager and all officers of Pioneer as such, and (2)
all expenses not hereinafter specifically assumed by Pioneer where such expenses
are incurred by the Manager or by Pioneer in connection with the management of
the investment and reinvestment of the assets of Pioneer, and the management of
the affairs of Pioneer. Pioneer assumes and shall pay: (1) charges and expenses
for determining from time to time the value of the net assets of Pioneer and the
keeping of its books and records, (2) the charges and expenses of auditors, (3)
the charges and expenses of any custodian, transfer agent, plan agent, dividend
disbursing agent and registrar appointed by Pioneer, (4) broker's commissions,
and issue and transfer taxes, chargeable to Pioneer in connection with
securities transactions to which Pioneer is a party, (5) insurance premiums,
interest charges, dues and fees for membership in trade associations and all
taxes and corporate fees payable by Pioneer to federal, state or other
governmental agencies, (6) the cost of share certificates representing shares of
beneficial interest of Pioneer, (7) fees and expenses involved in registering
and maintaining registrations of Pioneer and of its shares with the Securities
and Exchange Commission, including the preparation of prospectuses for filing
with said Commission, (8) all expenses of shareholders' and Trustees' meetings
and of preparing, printing and distributing notices, proxy statements and all
reports to shareholders and to governmental agencies, (9) charges and expenses
of legal counsel to Pioneer and (10) compensation of those Trustees of Pioneer
as such who are not affiliated with or interested persons of the Manager,
Pioneer (other than as Trustees) or The Pioneer Group, Inc.
4. Pioneer shall pay to the Manager, as compensation for the Manager's
services hereunder, a management fee at the rate of .50% per annum of the
average daily net assets of Pioneer up to $250,000,000 of such assets, .48% per
annum of such assets in excess of $250,000,000 and up to $300,000,000 and .45%
per annum of such assets in excess of $300,000,000. The management fee payable
hereunder shall be computed daily and paid monthly, subject to the following:
(a) in the event that the management fee payable by Pioneer hereunder, when
added to the fees, costs and expenses borne by Pioneer under Section 2 above
(exclusively of broker's commissions and taxes and interest charges, if any),
exceed on an annual basis 1% of the average daily net assets of Pioneer for such
period, then the management fee payable by Pioneer shall be reduced to the
extent necessary so that the amount of such management fee plus the amount of
said fees, costs and expenses borne by Pioneer shall not exceed said limitation;
and (b) if such fees, costs, and expenses, exclusive of (i) any management fee,
(ii) taxes and interest charges, if any, (iii) broker's commissions and (iv)
extraordinary expenses beyond the control of the Manager, exceed said annual
limitation on a proportionate basis, then the Manager shall pay to Pioneer the
balance, if any, of any such excess. The calculations provided for
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in (a) and (b) will be made monthly for each calendar month and for the
cumulative period beginning on the first day of Pioneer's fiscal year and ending
on the last day of the last calendar month for which the calculations are made
and, on the basis of the cumulative monthly calculations, the management fee
payable to Pioneer shall be reduced if and to the extent required by (a), and
the Manager shall reimburse Pioneer if and to the extent required by (b). As
used herein, "extraordinary expenses beyond the control of the Manager" means
any extraordinary expenses not caused by the bad faith, negligence or
malfeasance of the Manager.
5. Either party hereto may terminate this contract by vote of its Board
of Directors or its Board of Trustees, as the case may be, or by vote of a
majority of its outstanding voting securities and the giving of sixty days'
written notice to the other without penalty. -
6. This contract shall terminate on December 31 of any year in which
its terms and renewal shall not have been approved by a majority vote of the
Trustees of Pioneer voting in person, including a majority of its Trustees who
are not parties to this contract or interested persons (as the term "interested
persons" is defined in the Investment Company Act of 1940, as amended) of any
such parties, at a meeting of Trustees called for the purpose of voting on such
approval.
7. The Manager and its directors, officers, agents, employees and
stockholders may engage in other businesses and may render investment advisory
services to other investment companies or to any other corporation, association,
firm, individual or account.
8. Otherwise than as provided in Section 5 hereof, this contract shall
continue in full force and effect until terminated by written notice given by
one of the parties hereto as provided in Section 4.
9. This contract shall automatically terminate in the event of its
assignment. For purposes of this contract, the term "assignment" shall have the
meaning given it by Section 2(a) (4) of the Investment Company Act of 1940, as
from time to time amended.
10. This contract shall become effective as of the date of execution
hereof.
11. Nothing in this contract shall be deemed to relieve or deprive the
Board of Trustees of Pioneer of its responsibility for and control of Pioneer.
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12. The parties to this contract acknowledge and agree that all
liabilities arising, directly or indirectly, under this contract, of any and
every nature whatsoever, including without limitation, liabilities arising in
connection with the agreement, if any of Pioneer or its Trustees set forth
herein to indemnify any party to this contract or any other person, shall be
satisfied out of the assets of Pioneer and that no Trustee, officer or holder of
shares of beneficial interest of Pioneer shall be personally liable for any of
the foregoing liabilities. Pioneer's Declaration of Trust, as amended from time
to time, is on file in the Office of the Secretary of State of The Commonwealth
of Massachusetts. Such Declaration of Trust describes in detail the respective
responsibilities and limitations on liability of the Trustees, officers, and
holders of shares of beneficial interest.
IN WITNESS WHEREOF Pioneer has caused this contract to be executed by
its duly authorized officers and its seal to be hereto affixed, and the Manager
has caused this instrument to be executed by its duly authorized officers and
its seal to be hereto affixed, as of the day and year first above written.
PIONEER II
By: /s/ Xxxxxx X. Xxxxx
Treasurer
Attest: /s/ Xxxxxx X. Xxxxx
Secretary
PIONEERING MANAGEMENT CORPORATION
By: /s/ Xxxxxx X. Xxxxx
Attest: /s/ Xxxxxx X. Xxxxx
Secretary
