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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21043
Pioneer High Income Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: March 31
Date of reporting period: April 1, 2006 through March 31, 2007
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
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PIONEER
-----------
HIGH
INCOME
TRUST
Annual
Report
3/31/07
[LOGO PIONEER
Investments(R)]
Table of Contents
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Letter to Shareowners 2
Portfolio Management Discussion 4
Portfolio Summary 8
Prices and Distributions 9
Performance Update 10
Schedule of Investments 11
Financial Statements 27
Financial Highlights 30
Notes to Financial Statements 32
Report of Independent Registered Public Accounting Firm 43
Results of Shareowner Meeting 44
Factors Considered by the Independent Trustees in Approving
the Management Contract 45
Trustees, Officers and Service Providers 50
President's
Dear Shareowner,
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Staying diversified and keeping your portfolio invested in the markets are two
general investment principles that have served investors well over time. These
were particularly useful guides during the past year, as U.S. and global stock
and bond markets grew strongly during this period.
The markets were supported by relatively low short-term interest rates and
generally strong economies around the globe. The U.S. stock market, as measured
by the Standard & Poor's 500 Index, gained approximately 10% over the 12 months
ending March 31, 2007. European and emerging markets equities performed even
better, with indexes in those regions rising more than 20% over the same
period. The U.S. bond market, despite growing concerns about the health of the
U.S. mortgage industry, gained roughly 7% over the past 12 months, as measured
by the Lehman Aggregate Bond Index. The high yield market, as measured by the
Merrill Lynch High Yield Bond Master II Index, returned nearly 12%.
We believe that the climate for investors generally will continue to be
positive. While still strong, the U.S. economy has slowed. This was due in part
to the lagging effects of rising energy and commodity prices, rising short-term
interest rates from historically low levels, and the effect of U.S. factories
approaching full utilization.
We have enjoyed a cyclical recovery with strong economic growth, and the U.S.
economy now appears to be slowing to a rate that may be more sustainable. The
Federal Reserve Board has indicated a reduced likelihood of future rate hikes,
and continues to highlight its commitment to keeping inflationary pressures
contained. This is in keeping with "best practices" among the world's central
banks: low and stable inflation is believed to be the best backdrop for stable
economic growth and low average unemployment.
In Europe, healthy labor markets are supporting growing consumption and rising
GDP growth. Inflationary pressures appear to be largely under control, helped
by productivity gains and a positive operating environment for European
companies that are finding strong export markets for their goods and services
around the globe. Japanese economic growth continues to make progress, and the
country has
2
Letter
become a more attractive market compared to recent years. China continues its
rise as a world economic power, and its stock market has experienced the wide
market swings that often accompany rapid growth.
While the outlook generally appears favorable for investors, sudden swings in
the markets should be expected. Just as staying diversified and staying
invested are important investment principles, it is also important to pay
attention to asset allocation. As always, we encourage shareowners to work
closely with their financial advisor to find the appropriate mix of investments
in stocks, bonds and money market assets so that it is aligned to your
particular risk tolerance and investment objective.
Respectfully,
/s/ Daniel K. Kingsbury
Daniel K. Kingsbury, President and CEO
Pioneer Investment Management USA, Inc.
Any information in this shareowner report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of the opinion of Trust management as of the date of the report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
3
Pioneer High Income Trust
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PORTFOLIO MANAGEMENT DISCUSSION 3/31/07
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Corporate high-yield bonds turned in solid performance for the 12-months period
ended March 31, 2007, despite a rocky start in the spring of 2006 when
investors worried about the impact of interest rate increases by the U.S.
Federal Reserve ("Fed"). However, when the Fed left rates unchanged, beginning
in August 2006, high-yield bonds outperformed other domestic fixed income
sectors for the remainder of the period. The following is an interview with
Andrew Feltus, who discusses the performance of Pioneer High Income Trust
during the 12 months. Mr. Feltus is responsible for daily management of the
Trust.
Q: How did Pioneer High Income Trust perform during the 12 months ended
March 31, 2007?
A: The Trust performed well at net asset value and at market price. For the
12-month period, the Trust had a total return of 14.18% at net asset
value, outdistancing the Merrill Lynch High Yield Master II Index, which
rose 11.59%. At market price, the total return was 17.61% and the Trust
was selling at a 7.3% premium to net asset value as of March 31, 2007. The
Trust's 30-day SEC yield, based on its market price on March 31, 2007, was
10.57%.
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Q: What were the principal factors that contributed to the Trust's
outperformance?
A: For most of the period, after the Fed decided to pause in its cycle of
interest-rate hikes, we had a favorable backdrop for investing in
high-income securities. Although the housing and automobile industries
showed weakness, most parts of the economy kept growing. Yields of U.S.
Treasury bonds remained relatively flat, while investors bid up the prices
of high-yielding bonds, resulting in some tightening of the differences -
or spreads - in yields of high-quality and lower-quality fixed-income
securities. Security
4
Pioneer High Income Trust
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selection was key to the Trust's outperformance over the 12 months. Over
the period, we kept the Trust's duration - or sensitivity to interest-rate
changes - relatively short. We focused primarily on domestic,
high-yielding corporate bonds, and, as the period progressed, we upgraded
overall credit by selling some of our lower-rated holdings. Our overweight
position in CCC-rated bonds had helped performance in 2006, but we
gradually reduced that position to be more consistent with the weighting
of the Merrill Lynch benchmark index. As we pared back our CCC-rated
holdings, we began to make investments in bank loans, typically
floating-rate, which gave us more flexibility and higher quality. At the
end of the fiscal year, our largest weighting continued to be in domestic
high-yield corporates, which constituted 76% of Trust assets. This was an
increase from the 65% weighting six months earlier, primarily because we
reduced our exposure to emerging markets debt, which we believed to be
fully priced. Our remaining emerging market allocation was about 10% of
Trust assets at the end of the 12-month period. We also invested in
foreign high-yield bonds from developed nations, such as Canada and
Norway. By sectors, we overweighted cyclical companies, although we
reduced our emphasis as the period progressed, paring back our emphasis on
basic industries and airline stocks. We also overweighted bonds of energy
companies, believing that demand would continue to be high, especially for
oil services companies.
At the end of the fiscal year, the Trust's average credit quality was B. On
March 31, 2007, approximately 24% of Trust assets were leveraged. The
Trust has the ability to use leverage and borrow up to 331/3% of assets at
short-term rates to invest in high-yield bonds when we believe there is
opportunity to add to performance. Our use of leverage contributed to
performance during the 12-month period.
Q: What were some of the individual investments that influenced performance for
the period?
A: Two airline-related municipal bonds enjoyed dramatic increases in their
prices during the year, helping performance significantly. Bonds of Wayne
County, Michigan, backed by revenues from Northwest Airlines, and of
Charlotte, North Carolina, backed by U.S. Airways revenues, both gained
more than 20% in value on improved prospects for the airlines. Securities
issued by chemical
5
Pioneer High Income Trust
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PORTFOLIO MANAGEMENT DISCUSSION 3/31/07 (continued)
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company Celanese appreciated by more than 10% in price. Bonds of two
other, related chemical companies, Nell and Basell, had comparable
results, as they tendered for their debt. Securities of Duane Reade, a New
York-based drug and convenience store chain, generated a total return of
more than 40% as management executed a successful turnaround strategy. We
also had excellent results from our investment in bonds issued by FMG
Financial, an Australian company launching a major iron-ore mining and
shipping project in response to the strong growth in demand from China and
other emerging markets.
Several investments, however, were less successful. Although securities
issued by Accellent had positive performance, they underperformed the
overall market because of manufacturing problems in the production of the
company's medical devices. Food processor Wornick's bonds produced weak
results when the company stumbled in an attempt to move from the military
to the more highly competitive consumer market. The election of a new
president in the Republic of Ecuador, who was considered less friendly to
free markets, led to an erosion in the value of Ecuadorian government
bonds that we held.
Q: What is your investment outlook?
A: We think the high-yield bond market continues to have the potential to
continue to produce good returns, although they are not likely to
outperform high-grade investments as substantially as they have in recent
years. The yield advantages of high-yield bonds over high-grade securities
have tightened, but high-yield default rates have remained low as the U.S.
economy continues to expand. We believe fundamental analysis and
individual security analysis will be critically important in achieving
good investment results. We intend to continue to emphasize intensive
company analysis in our security selection.
We also remind investors that if short-term interest rates were to rise and
add to the Trust's borrowing costs, our ability to sustain recent dividend
levels would be diminished.
6
Pioneer High Income Trust
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Investments in high-yield or lower-rated securities are subject to
greater-than-average risk. The Trust may invest in securities of issuers that
are in default or that are in bankruptcy.
Investing in foreign and/or emerging markets securities involves risks relating
to interest rates, currency exchange rates, economic, and political conditions.
When interest rates rise, the prices of fixed-income securities in the Trust
will generally fall. Conversely, when interest rates fall the prices of
fixed-income securities in the Trust will generally rise. Investments in the
Trust are subject to possible loss due to the financial failure of underlying
securities and their inability to meet their debt obligations.
The Trust may invest up to 50% of its total assets in illiquid securities.
Illiquid securities may be difficult to dispose of at a fair price at the times
when the Trust believes it is desirable to do so and their market price is
generally more volatile than that of more liquid securities. Illiquid
securities are also more difficult to value and investment of the Trust's
assets in illiquid securities may restrict the Trust's ability to take
advantage of market opportunities.
The Trust may use leverage through the issuance of preferred shares with an
aggregate liquidation preference of up to 331/3% of the Trust's total assets
after such issuance. Leverage creates significant risks, including the risk
that the Trust's income or capital appreciation will not be sufficient to cover
the cost of leverage, which may adversely affect the return for the holders of
common shares.
Risks of investing in the Trust are discussed in greater detail in the Trust's
registration statement on Form N-2 relating to its common shares.
Any information in this shareowner report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of the opinion of Trust management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
7
Pioneer High Income Trust
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PORTFOLIO SUMMARY 3/31/07
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Portfolio Diversification
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(As a percentage of total investment portfolio)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
Corporate Bonds & Notes 85.5%
Municipal Bonds 5.8%
Temporary Cash Investments 4.4%
Sovereign Debt Obligations 1.5%
Floating Rate Loan Interests 1.2%
Municipal Collateralized Debt Obligations 0.5%
Convertible Bonds 0.3%
Fixed Rate Loan Interests 0.2%
Common Stocks 0.1%
Collateralized Mortgage Obligations 0.1%
Warrants 0.1%
Portfolio Maturity
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(As a percentage of long-term holdings)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
0-1 Year 13.1%
1-3 Years 20.4%
3-4 Years 18.8%
4-6 Years 40.0%
6-8 Years 4.3%
8+ Years 3.4%
The portfolio is actively managed, and current holdings may be different.
8
Pioneer High Income Trust
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PRICES AND DISTRIBUTIONS 3/31/07
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Share Prices and Distributions
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Market Value
per Common Share 3/31/07 3/31/06
$17.84 $16.80
Net Asset Value
per Common Share 3/31/07 3/31/06
$16.63 $16.13
Net
Distributions per Investment Short-Term Long-Term
Common Share Income Capital Gains Capital Gains
(4/1/06 - 3/31/07) $ 1.65 $ - $0.085
10 Largest Holdings
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(As a percentage of long-term holdings)*
1. Xerox Capital Trust I, 8.0%, 2/1/27 2.05%
2. NCO Group, Inc., 11.875%, 11/15/14 (144A) 1.61
3. Seabulk International, Inc., 9.5%, 8/15/13 1.47
4. GATX Financial Corp., 8.875%, 6/1/09 1.45
5. Cricket Communications, Inc., 9.375%, 11/1/14 (144A) 1.24
6. Cia Brasileira de Bebida, 10.5%, 12/15/11 1.20
7. Baytex Energy, Ltd., 9.625%, 7/15/10 1.17
8. Eschelon Operating Co., 8.375%, 3/15/10 1.17
9. Wimar Opco LLC, 9.625%, 12/15/14 (144A) 1.16
10. Builders FirstSource, Inc., 9.61%, 2/15/12 1.06
* This list excludes temporary cash and derivative investments. The portfolio
is actively managed, and current holdings may be different. The holdings
listed should not be considered recommendations to buy or sell any security
listed.
9
Pioneer High Income Trust
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PERFORMANCE UPDATE 3/31/07
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Investment Returns
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The mountain chart on the right shows the change in market value, plus
reinvested dividends and distributions, of a $10,000 investment made in common
shares of Pioneer High Income Trust, compared to that of the Merrill Lynch High
Yield Master II Index.
Cumulative Total Returns
(As of March 31, 2007)
Net Asset Market
Period Value (NAV) Price
Life-of-Trust
(4/26/02) 99.58% 104.52%
1 Year 14.18 17.61
[THE FOLLOWING DATA WAS REPRESENTED AS A LINE CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Merrill Lynch
High Yield Master II Pioneer High
Index Equity Fund
--------------------- ---------------------
4/02 10000 10000
10169 10729
3/04 12428 13661
13291 13930
3/06 14252 17391
3/07 15903 20453
Call 1-800-225-6292 or visit www.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below net asset value ("NAV"), due to such factors as
interest rate changes, and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
Closed-end funds, unlike open-end funds, are not continuously offered. There is
a one-time public offering and, once issued, shares of closed-end funds are sold
in the open market through a stock exchange and frequently trade at prices lower
than their NAV. NAV is total assets less total liabilities, which includes
preferred shares, divided by the number of common shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at
the greater of NAV or 95% of the market price. When NAV is higher, dividends are
assumed to be reinvested at prices obtained under the Trust's dividend
reinvestment plan.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Trust distributions or the redemption of Trust
shares.
Index comparison begins April 30, 2002. The Merrill Lynch High Yield Master II
Index is a commonly accepted measure of the performance of high yield
securities. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Trust returns, do not reflect any fees, expenses or sales
charges. You cannot invest directly in the Index.
10
Pioneer High Income Trust
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SCHEDULE OF INVESTMENTS 3/31/07
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Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
COLLATERIZED MORTGAGE OBLIGATIONS - 0.1% of Net Assets
Diversified Financials - 0.1%
425,000 BB/Ba3 DB Master Finance LLC, 8.285%, 6/20/31 (144A) $ 434,703
------------
TOTAL COLLATERIZED MORTGAGE OBLIGATIONS
(Cost $424,991) $ 434,703
------------
CORPORATE BONDS & NOTES - 117.3% of Net Assets
Energy - 13.7%
Oil & Gas Drilling - 2.8%
4,400,000 NR/NR DDI Holding AS, 9.3%, 1/19/12 (144A) $ 4,598,000
2,500,000 NR/NR Norse Energy Corp. ASA, 6.5%, 7/14/11 (144A) 2,018,750
NOK 3,000,000 NR/NR Norse Energy Corp. ASA, 10.0%, 7/13/10 490,244
NOK 11,550,000 NR/NR Petrojack AS, 11.0%, 4/19/10 1,892,171
3,500,000 NR/NR Skeie Drilling & Production ASA, 11.25%, 3/8/13 3,508,750
------------
$ 12,507,915
------------
Oil & Gas Equipment & Services - 1.8%
600,000(a) NR/NR DP Producer AS, 11.348%, 12/5/11 (144A) $ 609,000
1,100,000 NR/NR Nexus 1 Pte, Ltd., 10.5%, 3/7/12 (144A) 1,111,000
2,100,000(a) CCC+/B3 Pipe Acquisition Finance Plc, 11.604%,
12/15/10 (144A) 2,157,750
2,380,000 NR/B1 SemGroup L.P., 8.75%, 11/15/15 (144A) 2,415,700
2,000,000 NR/NR Sevan Marine ASA, 9.25%, 12/20/11 (144A) 2,050,000
------------
$ 8,343,450
------------
Integrated Oil & Gas - 0.2%
815,000 NR/B2 Tristan Oil, Ltd., 10.5%, 1/1/12 (144A) $ 823,150
------------
Oil & Gas Exploration & Production - 7.7%
6,584,000 B-/B3 Baytex Energy, Ltd., 9.625%, 7/15/10 $ 6,913,200
2,910,000 B-/B3 Clayton William Energy, 7.75%, 8/1/13 2,735,400
5,000,000 B/B3 Energy Partners, Ltd., 8.75%, 8/1/10 5,250,000
1,250,000 B/B3 Hilcorp Energy I, LP, 9.0%, 6/1/16 (144A) 1,325,000
4,500,000 BBB-/Ba1 Methanex Corp., 8.75%, 8/15/12 4,995,000
500,000(a) NR/NR PetroProd, Ltd., 11.36%, 1/12/12 508,750
5,300,000 CCC+/Caa2 PetroQuest Energy, Inc., 10.375%, 5/15/12 5,538,500
3,135,000 B-/Caa2 Stone Energy Corp., 6.75%, 12/15/14 2,931,225
4,280,000(m) B+/B2 VeraSun Energy Corp., 9.875%, 12/15/12 4,461,900
------------
$ 34,658,975
------------
Oil & Gas Refining & Marketing - 1.0%
4,325,000 B-/B3 Aventine Renewable Energy Holdings, Inc.,
10.0%, 4/1/17 (144A) $ 4,470,969
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The accompanying notes are an integral part of these financial statements. 11
Pioneer High Income Trust
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SCHEDULE OF INVESTMENTS 3/31/07 (continued)
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Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Oil & Gas Storage & Transportation - 0.2%
820,000 B-/B3 Targa Resources, Inc., 8.5%, 11/1/13 (144A) $ 836,400
------------
Total Energy $ 61,640,859
------------
Materials - 21.5%
Commodity Chemicals - 3.4%
4,635,000 B+/B1 ARCO Chemical Co., 9.8%, 2/1/20 $ 5,411,363
2,210,000 B+/B1 Georgia Gulf Corp., 9.5%, 10/15/14 (144A) 2,121,600
2,650,000 B/B2 Georgia Gulf Corp., 10.75%, 10/15/16 (144A) 2,544,000
5,000,000 B+/Ba3 Invista, 9.25%, 5/1/12 (144A) 5,325,000
------------
$ 15,401,963
------------
Diversified Chemicals - 4.7%
3,200,000 B-/B2 Basell Finance Co., 8.1%, 3/15/27 (144A) $ 3,200,000
6,060,000(b) B/B2 Crystal U.S. Holdings, 0.0%, 10/1/14 5,628,225
3,000,000 B-/B3 Hexion U.S. Finance Corp./Hexion Nova Scotia
Finance ULC, 9.75%, 11/15/14 (144A) 3,146,250
2,000,000 B-/B2 Ineos Group Holdings Plc., 8.5%, 2/15/16 (144A) 1,915,000
EURO 1,190,000 B-/B2 Nell AF S.a.r.l., 8.375%, 8/15/15 (144A) 1,712,774
EURO 3,904,000 B-/B3 Rhodia SA, 9.25%, 6/1/11 5,482,635
------------
$ 21,084,884
------------
Specialty Chemicals - 1.0%
785,000 CCC+/Caa1 MacDermid, Inc., 9.5%, 4/15/07 (144A) $ 804,625
3,300,000 B+/B1 Tronox Worldwide LLC, 9.5%, 12/1/12 3,498,000
------------
$ 4,302,625
------------
Construction Materials - 2.3%
4,500,000 B-/B2 AGY Holding Corp., 11.0%, 11/15/14 (144A) $ 4,680,000
1,500,000 CCC+/Caa1 Panolam Industries International, Inc., 10.75%,
10/1/13 (144A) 1,612,500
4,185,000 B-/B2 U.S. Concrete, Inc., 8.375%, 4/1/14 4,247,775
------------
$ 10,540,275
------------
Paper Packaging - 3.5%
5,450,000 B-/B3 Exopack Holding Corp., 11.25%, 2/1/14 $ 5,831,500
3,085,000(m) CCC+/Caa1 Graham Packaging Co., L.P., 9.875%, 10/15/14 3,146,700
5,540,000 B-/B3 Graphic Packaging International, Inc.,
9.5%, 8/15/13 5,893,175
EURO 710,000 B/B2 MDP Acquisitions Plc, 10.125%, 10/1/12 1,014,819
------------
$ 15,886,194
------------
12 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
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Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Aluminum - 1.5%
2,035,000 B-/Caa1 Aleris International, Inc., 10.0%, 12/15/16 (144A) $ 2,126,575
1,200,000 BB-/B1 Asia Aluminum Holdings, Ltd., 8.0%,
12/23/11 (144A) 1,201,500
3,180,000 B-/Caa1 Indalex Holding Corp., 11.5%, 2/1/14 3,291,300
------------
$ 6,619,375
------------
Diversified Metals & Mining - 3.3%
3,300,000 B-/Caa1 American Rock Salt Co., LLC, 9.5%, 3/15/14 $ 3,341,250
3,000,000 BB-/Ba3 FMG Finance Pty., Ltd., 10.625%, 9/1/16 (144A) 3,450,000
4,600,000 BB+/Baa3 Freeport-McMoRan Copper & Gold, Inc.,
10.125%, 2/1/10 4,841,500
3,050,000 B-/B3 PNA Group, Inc., 10.75%, 9/1/16 (144A) 3,278,750
------------
$ 14,911,500
------------
Steel - 1.5%
2,900,000 BB/Ba2 CSN Islands VIII Corp., 9.75%, 12/16/13 (144A) $ 3,306,000
630,000 BB/Ba2 CSN Islands IX Corp., 10.5%, 1/15/15 (144A) 743,400
2,485,000 B-/B3 Edgen Acquisition Corp., 9.875%, 2/1/11 2,540,912
------------
$ 6,590,312
------------
Forest Products - 0.3%
1,645,000 B-/B3 Mandra Forestry Holdings, Ltd., 12.0%,
5/15/13 (144A) $ 1,513,400
------------
Total Materials $ 96,850,528
------------
Capital Goods - 8.8%
Building Products - 2.0%
6,135,000(a) B/B2 Builders FirstSource, Inc., 9.61%, 2/15/12 $ 6,227,025
2,500,000 B/B3 Industrias Unidas SA de CV, 11.5%,
11/15/16 (144A) 2,668,750
------------
$ 8,895,775
------------
Electrical Components & Equipment - 0.7%
660,000 B/B3 Baldor Electric Co., 8.625%, 2/15/17 $ 697,950
2,270,000(c) NR/B3 Caiua Servicos Electricidad SA, 11.125% (144A) 2,333,560
------------
$ 3,031,510
------------
Heavy Electrical Equipment - 2.0%
4,790,000 CCC+/B2 Altra Industrial Motion, 9.0%, 12/1/11 $ 4,981,600
3,975,000 B-/B3 Hawk Corp., 8.75%, 11/1/14 4,024,688
------------
$ 9,006,288
------------
The accompanying notes are an integral part of these financial statements. 13
Pioneer High Income Trust
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SCHEDULE OF INVESTMENTS 3/31/07 (continued)
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Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Construction & Farm Machinery & Heavy Truck - 3.8%
2,900,000 B-/B3 Accuride Corp., 8.5%, 2/1/15 $ 2,921,750
5,250,000 B+/B1 Commercial Vehicle Group, Inc., 8.0%, 7/1/13 5,302,500
1,520,000 B/B2 Esco Corp., 8.625%, 12/15/13 (144A) 1,611,200
1,750,000 B+/B2 Greenbrier Companies, Inc., 8.375%, 5/15/15 1,776,250
1,000,000(b) CCC+/Caa2 Stanadyne Corp., 0.0%, 2/15/15 770,000
4,690,000 CCC+/Caa1 Stanadyne Corp., 10.0%, 8/15/14 4,830,700
------------
$ 17,212,400
------------
Industrial Machinery - 0.3%
1,217,000 B+/B2 Manitowac Co., Inc., 10.5%, 8/1/12 $ 1,294,584
------------
Total Capital Goods $ 39,440,557
------------
Commercial Services & Supplies - 7.1%
Diversified Commercial & Professional Services - 3.6%
3,500,000 CCC+/Caa1 Allied Security Escrow, 11.375%, 7/15/11 $ 3,570,000
1,050,000 B-/B3 Mobile Services Group, Inc., 9.75%,
8/1/14 (144A) 1,110,375
9,000,000 B-/Caa1 NCO Group, Inc., 11.875%, 11/15/14 (144A) 9,483,750
2,195,000 B-/B3 Park-Ohio Industries, Inc., 8.375%, 11/15/14 2,151,100
------------
$ 16,315,225
------------
Environmental & Facilities Services - 3.5%
4,088,000 B+/Ba3 Clean Harbors, Inc., 11.25%, 7/15/12 $ 4,548,149
5,020,000 CCC+/B3 Hydrochem Industrial Services, Inc., 9.25%,
2/15/13 (144A) 5,145,500
5,800,000 CCC/Caa1 Waste Services, Inc., 9.5%, 4/15/14 6,075,500
------------
$ 15,769,149
------------
Total Commercial Services & Supplies $ 32,084,374
------------
Transportation - 5.1%
Air Freight & Logistics - 0.5%
EURO 1,545,000 CCC+/B3 CEVA Group Plc, 10.0%, 12/1/16 (144A) $ 2,180,025
------------
Airlines - 0.7%
1,019,764 CCC+/B3 American Airlines, Inc., 7.379%, 11/23/17 $ 1,008,292
887,677 B+/B1 Continental Airlines, Inc., Series B,
8.499%, 11/1/12 907,650
1,000,000(c) NR/Ba2 GOL Finance, 8.75% (144A) 995,000
------------
$ 2,910,942
------------
14 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Marine - 3.4%
3,899,000(b) CCC+/Caa1 H-Lines Finance Holding, 0.0%, 4/1/13 $ 3,704,050
8,000,000 BBB-/Ba1 Seabulk International, Inc., 9.5%, 8/15/13 8,640,000
2,900,000 B-/B3 Trailer Bridge, Inc., 9.25%, 11/15/11 2,987,000
------------
$ 15,331,050
------------
Railroads - 0.5%
2,250,000 B-/B3 Grupo Transportacion Ferroviaria Mexicana,
SA de CV, 9.375%, 5/1/12 $ 2,418,750
------------
Total Transportation $ 22,840,767
------------
Automobiles & Components - 1.6%
Auto Parts & Equipment - 1.6%
5,965,000(m) CCC+/Caa1 Cooper-Standard Automotive, Inc.,
8.375%, 12/15/14 $ 4,995,687
2,000,000 B-/B3 UGS Corp., 10.0%, 6/1/12 2,187,500
------------
Total Automobiles & Components $ 7,183,187
------------
Consumer Durables & Apparel - 2.0%
Homebuilding - 1.6%
2,000,000 BB/Ba2 Meritage Homes Corp., 6.25%, 3/15/15 $ 1,805,000
1,480,000(m) CCC+/Caa2 Technical Olympic USA, Inc., 10.375%, 7/1/12 1,117,400
1,100,000(m) B-/Caa1 WCI Communities, Inc., 7.875%, 10/1/13 1,056,000
600,000 B/B3 William Lyon Homes, Inc., 7.5%, 2/15/14 525,000
3,200,000 B/B3 William Lyon Homes, Inc., 7.625%, 12/15/12 2,848,000
------------
$ 7,351,400
------------
Housewares & Specialties - 0.4%
1,650,000 CCC+/Caa1 Yankee Acquisition Corp., 9.75%, 2/15/17 (144A) $ 1,670,625
------------
Total Consumer Durables & Apparel $ 9,022,025
------------
Consumer Services - 4.8%
Casinos & Gaming - 4.4%
1,000,000 B/B2 Buffalo Thunder Development Authority, 9.375%,
12/15/14 (144A) $ 1,020,000
1,675,000 B+/B1 Galaxy Entertainment Finance Co., Ltd., 9.875%,
12/15/12 (144A) 1,829,937
4,500,000 B/B2 Little Traverse Bay Bands of Odawa Indians,
10.25%, 2/15/14 (144A) 4,635,000
1,700,000 B/B3 Pokagon Gaming Authority, 10.375%,
6/15/14 (144A) 1,874,250
3,550,000(m) B-/Caa1 Trump Entertainment Resorts, Inc., 8.5%, 6/1/15 3,585,500
6,800,000 CCC+/B3 Wimar Opco LLC, 9.625%, 12/15/14 (144A) 6,825,500
------------
$ 19,770,187
------------
The accompanying notes are an integral part of these financial statements. 15
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Hotels, Resorts & Cruise Lines - 0.4%
1,980,000(a) B/B2 HRP Myrtle Beach Operations LLC, 10.12%,
4/1/12 (144A) $ 1,989,900
------------
Total Consumer Services $ 21,760,087
------------
Media - 5.9%
Broadcasting & Cable Television - 2.9%
2,170,000 BB-/B1 Cablemas SA de CV, 9.375%, 11/15/15 (144A) $ 2,430,400
3,200,000 CCC-/Caa2 CCH I Holdings LLC, 11.0%, 10/1/15 3,320,000
1,500,000 CCC-/Caa2 CCH II Holdings LLC, 10.25%, 9/15/10 1,580,625
EURO 3,750,000 B-/B2 Kabel Deutschland GMBH, 10.75%, 7/1/14 5,728,106
------------
$ 13,059,131
------------
Movies & Entertainment - 0.7%
3,000,000 B-/B3 LodgeNet Entertainment Corp., 9.5%, 6/15/13 $ 3,278,355
------------
Publishing - 2.3%
1,604,643(d) CCC+/Caa1 AAC Group Holding Corp., 12.75%, 10/1/12 $ 1,805,223
4,835,000 B/B2 Sheridan Acquisition Corp., 10.25%, 8/15/11 5,058,619
3,700,000(b) B-/B3 Visant Holding Corp., 0.0%, 12/1/13 3,422,500
------------
$ 10,286,342
------------
Total Media $ 26,623,828
------------
Retailing - 1.9%
Distributors - 1.0%
4,735,000 B-/B3 Intcomex, Inc., 11.75%, 1/15/11 $ 4,794,188
------------
Department Stores - 0.9%
3,800,000 BBB-/Baa3 J.C. Penney Co., Inc., 8.125%, 4/1/27 $ 3,907,768
------------
Total Retailing $ 8,701,956
------------
Food & Staples Retailing - 1.4%
Drug Retail - 0.7%
3,350,000 CC/Caa3 Duane Reade, Inc., 9.75%, 8/1/11 $ 3,224,375
------------
Food Distributors - 0.7%
3,380,000 CCC+/Ca Wornick Co., 10.875%, 7/15/11 $ 3,003,975
------------
Total Food & Staples Retailing $ 6,228,350
------------
Food, Beverage & Tobacco - 3.9%
Brewers - 1.6%
5,885,000 BBB/Baa1 Cia Brasileira de Bebida, 10.5%, 12/15/11 $ 7,062,000
------------
Agricultural Products - 0.5%
2,000,000(c) BB/Ba2 Cosan SA Industria e Comercio, 8.25% (144A) $ 2,005,000
500,000 B+/B1 Marfrig Overseas, Ltd., 9.625%, 11/16/16 (144A) 521,250
------------
$ 2,526,250
------------
16 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Packaged Foods & Meats - 1.5%
775,000 B+/Ba3 Bertin, Ltd., 10.25%, 10/5/16 (144A) $ 850,563
2,410,000 B/NR Minerva Overseas, Ltd., 9.5%, 2/1/17 (144A) 2,440,125
3,180,000 CCC/Caa1 Nutro Products, Inc., 10.75%, 4/15/14 (144A) 3,434,400
------------
$ 6,725,088
------------
Tobacco - 0.3%
1,230,000 B/B2 Alliance One International, Inc., 8.5%,
5/15/12 (144A) $ 1,239,947
------------
Total Food, Beverage & Tobacco $ 17,553,285
------------
Health Care Equipment & Services - 5.9%
Health Care Equipment & Services - 0.7%
2,875,000 B-/Caa2 Accellent, Inc., 10.5%, 12/1/13 $ 2,975,625
------------
Health Care Supplies - 0.6%
2,900,000(a) CCC+/B3 Medical Services Co., 12.86%, 10/15/11 $ 2,733,250
------------
Health Care Services - 1.5%
2,160,000 B-/B3 AMR HoldCo/Emcare HoldCo, 10.0%, 2/15/15 $ 2,376,000
4,055,000 CCC+/B3 Rural/Metro Corp., 9.875%, 3/15/15 4,313,506
------------
$ 6,689,506
------------
Health Care Facilities - 2.1%
3,800,000 CCC+/Caa2 Hanger Orthopedic Group, Inc., 10.25%, 6/1/14 $ 4,037,500
2,555,000(d) BB-/B2 HCA, Inc., 10.375%, 11/15/16 (144A) 2,759,400
2,130,000 B-/B3 Psychiatric Solutions, Inc., 7.75%, 7/15/15 2,161,950
575,000 CCC+/B3 Sun Healthcare Group, Inc., 9.125%,
4/15/15 (144A) 589,375
------------
$ 9,548,225
------------
Managed Health Care - 1.0%
4,400,000 B-/Caa1 Multiplan, Inc., 10.375%, 4/15/16 (144A) $ 4,510,000
------------
Total Health Care Equipment & Services $ 26,456,606
------------
Pharmaceuticals & Biotechnology & Life Sciences - 2.9%
Biotechnology - 0.7%
3,500,000 B-/B3 Angiotech Pharmaceuticals, Inc., 7.75%, 4/1/14 $ 3,228,750
------------
Pharmaceuticals - 2.2%
2,000,000 B-/B2 Phibro Animal Health Corp., 10.0%,
8/1/13 (144A) $ 2,130,000
3,000,000 CCC+/Caa1 Phibro Animal Health Corp., 13.0%,
8/1/14 (144A) 3,210,000
4,317,000 B-/Caa1 Warner Chilcott Corp., 8.75%, 2/1/15 4,500,473
------------
$ 9,840,473
------------
Total Pharmaceuticals & Biotechnology &
Life Sciences $ 13,069,223
------------
The accompanying notes are an integral part of these financial statements. 17
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Banks - 0.3%
Diversified Banks - 0.3%
1,500,000(a)(c) NR/B1 ALB Finance BV, 9.375% $ 1,377,750
------------
Total Banks $ 1,377,750
------------
Diversified Financials - 6.0%
Other Diversified Financial Services - 0.6%
605,000 B-/Caa1 PGS Solutions, Inc., 9.625%, 2/15/15 (144A) $ 609,919
1,870,000(a) B-/Caa1 PNA Intermediate Holding Corp., 12.36%,
2/15/13 (144A) 1,916,750
------------
$ 2,526,669
------------
Specialized Finance - 2.9%
7,950,000 BBB+/Baa1 GATX Financial Corp., 8.875%, 6/1/09 $ 8,526,614
4,615,000 CCC+/Caa1 Sally Holdings LLC, 10.5%, 11/15/16 (144A) 4,741,913
------------
$ 13,268,527
------------
Consumer Finance - 2.5%
4,770,000 B-/Caa1 ACE Cash Express, Inc., 10.25%, 10/1/14 (144A) $ 4,913,100
3,000,000 B/B1 Ford Motor Credit Co., 7.875%, 6/15/10 3,011,157
3,000,000(a) B/B1 Ford Motor Credit Co., 9.81%, 4/15/12 3,180,579
------------
$ 11,104,836
------------
Total Diversified Financials $ 26,900,032
------------
Insurance - 2.5%
Life & Health Insurance - 1.3%
5,725,000 B/B2 Presidential Life Corp., 7.875%, 2/15/09 $ 5,782,250
------------
Multi-Line Insurance - 1.2%
5,300,000 BB+/Ba1 Allmerica Financial Corp., 7.625%, 10/15/25 $ 5,691,893
------------
Total Insurance $ 11,474,143
------------
Software & Services - 2.2%
IT Consulting & Other Services - 1.0%
4,450(e) CCC+/B2 MSX International UK/MXS International Business
Services FR/MXS International GmBH, 12.5%,
4/1/12 (144A) $ 4,483,375
------------
Data Processing & Outsourced Services - 0.1%
640,000 CCC+/Caa1 iPayment, Inc., 9.75%, 5/15/14 $ 656,000
------------
Application Software - 0.2%
810,000 CCC+/Caa1 Open Solutions, Inc., 9.75%, 2/1/15 (144A) $ 834,300
------------
Computer Hardware - 0.9%
3,750,000 B/B2 Compucom Systems, Inc., 12.0%,
11/1/14 (144A) $ 4,003,125
------------
Total Software & Services $ 9,976,800
------------
18 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Technology Hardware & Equipment - 4.3%
Communications Equipment - 1.2%
5,000,000 B-/B1 Hughes Network Systems LLC/HNS Finance Corp.,
9.5%, 4/15/14 $ 5,262,500
------------
Computer Hardware - 0.4%
1,870,000 CCC+/Caa1 Activant Solutions, Inc., 9.5%, 5/1/16 $ 1,841,950
------------
Office Electronics - 2.7%
11,830,000 B+/Ba1 Xerox Capital Trust I, 8.0%, 2/1/27 $ 12,066,600
------------
Total Technology Hardware & Equipment $ 19,171,050
------------
Semiconductors & Semiconductor Equipment - 0.3%
Semiconductors - 0.3%
1,300,000(a) B/B1 Freescale Semiconductor, Inc., 9.23%,
12/15/14 (144A) $ 1,296,750
------------
Total Semiconductors &
Semiconductor Equipment $ 1,296,750
------------
Telecommunication Services - 13.0%
Integrated Telecommunication Services - 2.5%
7,149,000 B-/B2 Eschelon Operating Co., 8.375%, 3/15/10 $ 6,907,721
3,720,000 B-/B3 GC Impsat Holdings I Plc, 9.875%,
2/15/17 (144A) 3,729,300
691,000 NR/Baa3 Tele Norte Leste Participacoes SA,
8.0%, 12/18/13 740,406
------------
$ 11,377,427
------------
Wireless Telecommunication Services - 10.5%
3,100,000 B-/B3 Broadview Networks Holdings, Inc., 11.375%,
9/1/12 (144A) $ 3,317,000
1,625,000 CCC+/Caa2 Cell C Property, Ltd., 11.0%, 7/1/15 (144A) 1,641,250
2,855,000(a) CCC+/Caa1 Cleveland Unlimited, Inc., 13.605%,
12/15/10 (144A) 3,119,087
6,900,000 CCC/Caa2 Cricket Communications, Inc., 9.375%,
11/1/14 (144A) 7,314,000
1,500,000 NR/B3 Digicel, Ltd., 9.25%, 9/1/12 (144A) 1,582,500
2,500,000(a) CCC+/Caa1 Hellas Telecommunications Luxembourg II,
11.115%, 1/15/15 (144A) 2,568,750
3,900,000 B-/B3 Horizon PCS, Inc., 11.375%, 7/15/12 4,319,250
2,200,000(b) B+/B1 Inmarsat Finance II Plc, 0.0%, 11/15/12 2,079,000
The accompanying notes are an integral part of these financial statements. 19
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Wireless Telecommunication Services - (continued)
3,200,000(b) B/B3 Intelsat Intermediate Holding Co., Ltd.,
0.0%, 2/1/15 $ 2,656,000
5,150,000 NR/NR Mobifon Holdings BV, 12.5%, 7/31/10 5,574,875
3,230,000 BB-/Ba3 Mobile Telesystems, 9.75%, 1/30/08 (144A) 3,326,900
3,000,000(a) CCC/Caa2 Rural Cellular Corp., 11.11%, 11/1/12 3,120,000
3,200,000 B-/B3 Stratos Global Corp., 9.875%, 2/15/13 3,416,000
3,020,000 B/B2 True Move Co., Ltd., 10.75%, 12/16/13 (144A) 3,072,850
------------
$ 47,107,462
------------
Total Telecommunication Services $ 58,484,889
------------
Utilities - 2.2%
Electric Utilities - 1.8%
2,000,000 BB-/Ba3 Aes Chivor SA ESP, 9.75%, 12/30/14 (144A) $ 2,250,000
1,500,000 NR/NR Mirant JPSCo. Finance, Ltd., 11.0%,
7/6/16 (144A) 1,605,000
4,436,159 NR/NR Ormat Funding Corp., 8.25%, 12/30/20 4,491,611
------------
$ 8,346,611
------------
Multi-Utilities - 0.4%
2,175,000(a) NR/NR Power Contract Financing III LLC, 0.681%,
2/5/10 (144A) $ 1,745,437
------------
Total Utilities $ 10,092,048
------------
TOTAL CORPORATE BONDS & NOTES
(Cost $494,026,247) $528,229,094
------------
CONVERTIBLE BONDS & NOTES - 0.4% of Net Assets
Software & Services - 0.4%
Systems Software - 0.4%
1,400,000 NR/NR Macrovision Corp., 2.625%, 8/15/11 (144A) $ 1,568,000
------------
TOTAL CONVERTIBLE BONDS & NOTES
(Cost $1,400,000) $ 1,568,000
------------
20 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
MUNICIPAL BONDS - 8.0% of Net Assets
Indiana - 2.0%
1,650,000 BBB/Ba1 East Chicago Industrial Pollution Control Revenue,
7.0%, 1/1/14 $ 1,749,693
3,000,000 BBB/Ba1 East Chicago Industrial Pollution Control Revenue,
7.125%, 6/1/07 3,010,680
4,250,000 BBB/Ba1 Indiana Development Finance Authority Revenue,
5.75%, 10/1/11 4,410,905
------------
$ 9,171,278
------------
Michigan - 0.5%
3,000,000(f) NR/NR Wayne Charter County, Special Airport Facilities
Revenue, 6.75%, 12/1/15 $ 2,037,780
------------
New Jersey - 2.1%
4,525,000 B/B3 New Jersey Economic Development Authority
Revenue, 7.0%, 11/15/30 $ 4,846,727
4,000,000 AAA/Aaa Tobacco Settlement Financing Corp.,
7.0%, 6/1/41 4,709,840
------------
$ 9,556,567
------------
New York - 0.9%
3,475,000 BB-/Ba2 New York City Industrial Development Agency,
British Airways Plc Proj., 7.625%, 12/1/32 $ 3,884,425
------------
North Carolina - 1.6%
4,800,000 NR/NR Charlotte, Special Facilities Revenue, Charlotte/
Douglas International Airport, 5.6%, 7/1/27 $ 4,826,976
2,000,000 NR/NR Charlotte, Special Facilities Revenue, Charlotte/
Douglas International Airport, 7.75%, 2/1/28 2,138,220
------------
$ 6,965,196
------------
Texas - 0.9%
3,200,000(g) AAA/Aa1 San Antonio, Texas, Electric & Gas, RIB, 7.174%,
2/1/19 (144A) $ 4,218,048
------------
TOTAL MUNICIPAL BONDS
(Cost $28,057,094) $ 35,833,294
------------
The accompanying notes are an integral part of these financial statements. 21
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
MUNICIPAL COLLATERALIZED DEBT OBLIGATION -
0.7% of Net Assets
3,300,000(h) NR/NR Non-Profit Preferred Funding Trust I,
8.0%, 9/15/37 $ 3,302,871
------------
TOTAL MUNICIPAL COLLATERALIZED DEBT OBLIGATION
(Cost $3,293,400) $ 3,302,871
------------
SOVEREIGN DEBT OBLIGATIONS - 2.1% of Net Assets
Brazil - 0.8%
ITL 4,800,000,000(b) BB/Baa3 Banco Nacional de Desenvolimento Bndes,
8.0%, 4/28/10 $ 3,613,403
------------
Ecuador - 0.7%
3,515,000(b) CCC/Caa2 Federal Republic of Ecuador, 10.0%,
8/15/30 (144A) $ 3,128,350
------------
Russia - 0.6%
2,320,000(b) BBB+/Baa2 Russia Government International Bond,
5.0%, 3/31/30 $ 2,632,968
------------
TOTAL SOVEREIGN DEBT OBLIGATIONS
(Cost $6,126,059) $ 9,374,721
------------
FLOATING RATE LOAN INTERESTS - 1.7% of Net Assets (i)
Energy - 0.2%
Oil & Gas Exploration & Production - 0.2%
710,000 B/B3 SandRidge Energy, Inc. (Riata), Unsecured Bridge
Term Loan, 3.625%, 4/1/14 $ 721,094
------------
Total Energy $ 721,094
------------
Capital Goods - 0.5%
Building Products - 0.4%
2,000,000 CCC+/Caa1 Custom Building Products, Inc., Second Lien
Term Loan, 10.36%, 4/20/12 $ 1,995,000
------------
Construction & Farm Machinery & Heavy Trucks - 0.1%
500,000 B-/B3 Rental Service Corp., Second Lien Initial Term
Loan, 8.85% - 8.86%, 12/2/13 $ 502,969
------------
Total Capital Goods $ 2,497,969
------------
Consumer Durables & Apparel - 0.3%
Homebuilding - 0.3%
1,300,000 BB/Ba3 LandSource Communities Development LLC,
Second Lien Term Loan, 9.875%, 2/27/14 $ 1,318,890
------------
Total Consumer Durables & Apparel $ 1,318,890
------------
22 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD($) (unaudited) Value
Diversified Financials - 0.7%
Other Diversified Financial Services - 0.7%
500,000 B-/B2 J.G. Wentworth, Second Lien Term Loan,
5.0%, 3/1/14 $ 506,250
EURO 1,951,638 NR/NR Louis Topco, Ltd., Term Loan, 11.604%, 6/1/17 2,628,231
------------
Total Diversified Financials $ 3,134,481
------------
TOTAL FLOATING RATE LOAN INTERESTS
(Cost $7,502,543) $ 7,672,434
------------
FIXED RATE LOAN INTERESTS - 0.2% of Net Assets
Energy - 0.2%
Oil & Gas Exploration & Production - 0.2%
1,070,000 B/B3 SandRidge Energy, Inc. (Riata), Unsecured Bridge
Term Loan, 8.625%, 4/1/15 $ 1,088,725
------------
TOTAL FIXED RATE LOAN INTERESTS
(Cost $1,070,000) $ 1,088,725
------------
Shares
COMMON STOCKS - 0.1% of Net Assets
Pharmaceuticals & Biotechnology &
Life Sciences - 0.1%
Pharmaceuticals - 0.1%
17,818 Teva Pharmaceutical Industries, Ltd. (A.D.R.) $ 666,928
------------
TOTAL COMMON STOCKS
(Cost $752,276) $ 666,928
------------
WARRANTS - 0.1% of Net Assets (j)
Energy - 0.1%
Oil & Gas Drilling - 0.1%
2,500,000 Norse Energy Corp. ASA - CW11, Expires 7/14/11 $ 532,429
------------
Total Energy $ 532,429
------------
Materials - 0.0%
Forest Products - 0.0%
1,645 Mandra Forestry Holdings, Ltd. - CW13,
Expires 5/15/13 $ -
------------
Total Materials $ -
------------
The accompanying notes are an integral part of these financial statements. 23
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
Shares Value
Transportation - 0.0%
Railroads - 0.0%
4,525 Atlantic Express Transportation Corp.,
Expires 4/15/08 $ 9,050
-------------
Total Transportation $ 9,050
-------------
TOTAL WARRANTS
(Cost $523,408) $ 541,479
-------------
Principal
Amount
USD($)
TEMPORARY CASH INVESTMENTS - 6.0% of Net Assets
Repurchase Agreement - 1.9%
8,700,000 JPMorgan Chase & Co., 5.05%, dated 3/30/07,
repurchase price of $8,700,000 plus accrued
interest on 4/2/07 collateralized by $8,976,000
U.S. Treasury Notes, 3.375%, 12/15/08 $ 8,700,000
-------------
Shares
Security Lending Collateral - 4.1%
18,534,460 Securities Lending Investment Fund, 5.262% $ 18,534,460
-------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $27,234,460) $ 27,234,460
-------------
TOTAL INVESTMENTS IN SECURITIES - 136.7%
(Cost $570,410,478) (k) (l) $ 615,946,709
-------------
OTHER ASSETS AND LIABILITIES - (3.2)% $ (14,379,274)
-------------
PREFERRED SHARES AT REDEMPTION VALUE,
INCLUDING DIVIDENDS PAYABLE - (33.5)% $(151,123,078)
-------------
NET ASSETS APPLICABLE TO COMMON
SHAREOWNERS - 100.0% $ 450,444,357
=============
24 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
NR Security not rated by S&P or Moody's.
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration. At
March 31, 2007, the value of these securities amounted to $204,011,332
or 45.3% of total net assets applicable to common shareowners.
(a) Floating rate note. The rate shown is the rate at March 31, 2007.
(b) Debt obligation initially issued at one coupon which converts to a higher
coupon at a specific date. The rate shown is the rate at March 31, 2007.
(c) Security is a perpetual bond and has no definite maturity date.
(d) Represents a pay-in-kind security which may pay interest in additional
principal.
(e) Security is priced as a unit.
(f) Security is in default and is non-income producing.
(g) The interest rate is subject to change periodically and inversely based
upon prevailing market rates. The rate shown is the rate at March 31,
2007.
(h) The interest rate is subject to change periodically. The interest rate
shown is the rate at March 31, 2007.
(i) Floating rate loan interests in which the Trust invests generally pay
interest at rates that are periodically redetermined by reference to a
base lending rate plus a premium. These base lending rates are generally
(i) the lending rate offered by one or more major European banks, such as
LIBOR (London InterBank Offered Rate), (ii) the prime rate offered by one
or more major United States banks, (iii) the certificate of deposit or
(iv) other base lending rates used by commercial lenders. The rate shown
is the coupon rate at March 31, 2007.
(j) Non-income producing.
(k) At March 31, 2007, the net unrealized gain on investments based on cost
for federal income tax purposes of $570,791,565 was as follows:
Aggregate gross unrealized gain for all investments in which there is
an excess of value over tax cost $46,875,672
Aggregate gross unrealized loss for all investments in which there is
an excess of tax cost over value (1,720,528)
-----------
Net unrealized gain $45,155,144
===========
For financial reporting purposes net unrealized gain was $45,536,231 and
cost of investments aggregated $570,410,478.
The accompanying notes are an integral part of these financial statements. 25
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
(l) Distribution of investments by country of issue, as a percentage of total
holdings, is as follows:
United States 74.9%
Norway 3.9
Mexico 2.6
Great Britain 2.4
Canada 2.2
Brazil 1.8
Cayman Islands 1.4
Australia 1.4
France 1.2
Luxembourg 1.1
Germany 0.9
Bermuda 0.8
Colombia 0.7
Romania 0.7
Russia 0.7
Ecuador 0.5
Thailand 0.5
Jamaica 0.4
India 0.4
South Africa 0.4
Denmark 0.4
China 0.3
Netherlands 0.2
Singapore 0.2
----
100.0%
=====
(m) At March 31, 2007, the following securities were out on loan:
Principal
Amount Description Market Value
$ 5,905,350 Cooper-Standard Automotive, Inc., 8.375%, 12/15/14 $ 4,945,731
3,054,150 Graham Packaging Co., L.P., 9.875%, 10/15/14 3,115,233
722,700 Technical Olympic USA, Inc., 10.375%, 7/1/12 545,638
3,514,500 Trump Entertainment Resorts, Inc., 8.5%, 6/1/15 3,549,645
4,237,200 VeraSun Energy Corp., 9.875%, 12/15/12 4,417,281
1,089,000 WCI Communities, Inc., 7.875%, 10/1/13 1,045,440
-----------
$17,618,968
===========
Note: Principal amounts are denominated in U.S. dollars unless otherwise
denoted.
EURO Euro
ITL Italian Lira
NOK Norwegian Krone
(A.D.R.) American Depositary Receipt
RIB Residual Interest Bonds
Purchases and sales of securities (excluding temporary cash investments)
for the year ended March 31, 2007, aggregated $258,416,574 and
$152,336,330, respectively.
26 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 3/31/07
--------------------------------------------------------------------------------
ASSETS:
Investments in securities, at value (including securities
loaned of $17,618,968) (cost $570,410,478) $615,946,709
Foreign currencies, at value (cost $10,621,954) 10,637,140
Receivables -
Interest and foreign tax reclaim 13,270,237
Reinvestment of distributions 243,560
Other assets 11,975
Prepaid expenses 30,305
------------
Total assets $640,139,926
------------
LIABILITIES:
Payables -
Investment securities purchased $ 12,111,580
Upon return of securities loaned 18,534,460
Forward foreign currency portfolio hedge contracts - net 1,216,180
Due to custodian 6,349,764
Due to affiliate 315,083
Accrued expenses 45,424
------------
Total liabilities $ 38,572,491
------------
PREFERRED SHARES AT REDEMPTION VALUE:
$25,000 liquidation value per share applicable to 6,040
shares, including dividends payable of $123,078 $151,123,078
------------
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Paid-in capital $386,187,515
Undistributed net investment income 10,652,261
Accumulated net realized gain on investments 9,271,568
Net unrealized gain on investments 45,536,231
Net unrealized loss on forward foreign currency contracts
and other assets and liabilities denominated in foreign
currencies (1,203,218)
------------
Net assets applicable to common shareowners $450,444,357
============
NET ASSET VALUE PER SHARE:
No par value (unlimited number of shares authorized)
Based on $450,444,357/27,093,609 common shares $ 16.63
============
The accompanying notes are an integral part of these financial statements. 27
Pioneer High Income Trust
--------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
--------------------------------------------------------------------------------
For the Year Ended 3/31/07
INVESTMENT INCOME:
Interest $54,966,529
Dividends (net of foreign taxes withheld $267) 4,833
Income from securities loaned, net 179,193
-----------
Total investment income $55,150,555
-----------
EXPENSES:
Management fees $ 3,535,157
Administrative reimbursements 129,727
Transfer agent fees and expenses 59,038
Auction agent fees 404,134
Custodian fees 98,013
Registration fees 24,361
Professional fees 110,440
Printing expense 20,742
Trustees' fees 11,338
Pricing fee 18,027
Miscellaneous 31,782
-----------
Total expenses $ 4,442,759
Less fees paid indirectly (54)
-----------
Net expenses $ 4,442,705
-----------
Net investment income $50,707,850
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain from:
Investments $14,597,925
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies 1,685,982 $16,283,907
----------- -----------
Change in net unrealized gain (loss) from:
Investments $ 4,065,028
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies (3,272,674) $ 792,354
----------- -----------
Net gain on investments and foreign currency
transactions $17,076,261
-----------
DIVIDENDS AND DISTRIBUTIONS TO PREFERRED
SHAREOWNERS FROM:
Net investment income $(7,327,339)
Net realized gains (351,876)
-----------
Total distributions $(7,679,215)
-----------
Net increase in net assets applicable to common
shareowners resulting from operations $60,104,896
===========
28 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
For the Years Ended 3/31/07 and 3/31/06
Year Year
Ended Ended
3/31/07 3/31/06
FROM OPERATIONS:
Net investment income $ 50,707,850 $ 50,500,053
Net realized gain on investments and foreign
currency transactions 16,283,907 3,761,733
Change in net unrealized gain (loss) on investments
and foreign currency transactions 792,354 (3,712,016)
Dividends and distributions to preferred
shareowners from:
Net investment income (7,327,339) (5,167,771)
Net realized gains (351,876) (502,302)
------------- -------------
Net increase in net assets applicable to
common shareowners resulting from
operations $ 60,104,896 $ 44,879,697
------------- -------------
DIVIDENDS AND DISTRIBUTIONS TO
COMMON SHAREOWNERS:
Net investment income
($1.65 and $1.65 per share, respectively) $ (44,546,595) $ (44,321,228)
Net realized capital gains
($0.09 and $0.23 per share, respectively) (2,298,583) (6,166,115)
------------- -------------
Total distributions to common shareowners $ (46,845,178) $ (50,487,343)
------------- -------------
FROM TRUST SHARE TRANSACTIONS:
Reinvestment of distributions $ 2,755,523 $ 1,733,358
------------- -------------
Net increase in net assets applicable to
common shareowners resulting from Trust
share transactions $ 2,755,523 $ 1,733,358
------------- -------------
Net increase (decrease) in net assets applicable
to common shareowners $ 16,015,241 $ (3,874,288)
NET ASSETS APPLICABLE TO COMMON
SHAREOWNERS:
Beginning of year 434,429,116 438,303,404
------------- -------------
End of year $ 450,444,357 $ 434,429,116
============= =============
Undistributed net investment income $ 10,652,261 $ 6,053,152
============= =============
The accompanying notes are an integral part of these financial statements. 29
Pioneer High Income Trust
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Year Year Year Year 4/26/02 (b)
Ended Ended Ended Ended to
3/31/07 3/31/06 3/31/05 3/31/04 3/31/03
Per Common Share Operating Performance
Net asset value, beginning of period $ 16.13 $ 16.34 $ 16.20 $ 13.43 $ 14.33(c)
------- ------- ------- ------- --------
Increase (decrease) from investment operations:(a)
Net investment income $ 1.88 $ 1.88 $ 1.87 $ 1.77 $ 1.41
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 0.64 0.00(d) 0.15 2.73 (0.81)
Dividends and distributions to preferred shareowners from:
Net investment income (0.27) (0.19) (0.10) (0.06) (0.04)
Realized gains (0.01) (0.02) 0.00(d) - -
------- ------- ------- ------- --------
Net increase from investment operations $ 2.24 $ 1.67 $ 1.92 $ 4.44 $ 0.56
Dividends and distributions to common shareowners from:
Net investment income (1.65) (1.65) (1.65) (1.65) (1.38)
Realized gains (0.09) (0.23) (0.13) - -
Capital charge with respect to issuance of:
Common shares - - - - (0.03)
Preferred shares - - - (0.02) (0.05)
------- ------- ------- ------- --------
Net increase (decrease) in net asset value $ 0.50 $ (0.21) $ 0.14 2.77 $ (0.90)
------- ------- ------- ------- --------
Net asset value, end of period(e) $ 16.63 $ 16.13 $ 16.34 $ 16.20 $ 13.43
======= ======= ======= ======= ========
Market value, end of period(e) $ 17.84 $ 16.80 $ 15.12 $ 16.57 $ 14.49
------- ------- ------- ------- --------
Total return(f) 17.61% 24.84% 1.97% 27.33% 7.29%
Ratios to average net assets of common shareowners
Net expenses(g) 1.01% 0.99% 1.00% 0.96% 0.87%(h)
Net investment income before preferred share dividends 11.57% 11.68% 11.60% 11.64% 11.62%(h)
Preferred share dividends 1.67% 1.19% 0.63% 0.39% 0.37%(h)
Net investment income available to common shareowners 9.90% 10.49% 10.97% 11.25% 11.25%(h)
Portfolio turnover 27% 20% 54% 66% 49%
30 The accompanying notes are an integral part of these financial statements.
Pioneer High Income Trust
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (continued)
--------------------------------------------------------------------------------
Year Year
Ended Ended
3/31/07 3/31/06
Per Common Share Operating Performance (continued)
Net assets of common shareowners, end of period (in thousands) $ 450,444 $ 434,429
Preferred shares outstanding (in thousands) $ 151,000 $ 151,000
Asset coverage per preferred share, end of period $ 99,597 $ 96,940
Average market value per preferred share $ 25,000 $ 25,000
Liquidation value, including dividends payable, per preferred share $ 25,020 $ 25,015
Ratios to average net assets of common shareowners before
reimbursement of organization expenses
Net expenses(g) 1.01% 0.99%
Net investment income before preferred share dividends 11.57% 11.68%
Preferred share dividends 1.67% 1.19%
Net investment income available to common shareowners 9.90% 10.49%
Year Year 4/26/02 (b)
Ended Ended to
3/31/05 3/31/04 3/31/03
Per Common Share Operating Performance (continued)
Net assets of common shareowners, end of period (in thousands) $ 438,303 $ 433,556 $ 358,123
Preferred shares outstanding (in thousands) $ 151,000 $ 151,000 $ 101,000
Asset coverage per preferred share, end of period $ 97,569 $ 96,781 $ 113,647
Average market value per preferred share $ 25,000 $ 25,000 $ 25,000
Liquidation value, including dividends payable, per preferred share $ 25,003 $ 25,000 $ 25,003
Ratios to average net assets of common shareowners before
reimbursement of organization expenses
Net expenses(g) 1.00% 0.96% 0.88%(h)
Net investment income before preferred share dividends 11.60% 11.64% 11.61%(h)
Preferred share dividends 0.63% 0.39% 0.37%(h)
Net investment income available to common shareowners 10.97% 11.25% 11.24%(h)
(a) The per common share data presented above is based upon the average common
shares outstanding for the periods presented.
(b) The Trust common shares were first publicly offered on April 26, 2002.
(c) Net asset value immediately after the closing of the first public offering
was $14.30.
(d) Amount is less than $0.01 per common share.
(e) Net asset value and market value are published in Barron's on Saturday, The
Wall Street Journal on Monday and The New York Times on Monday and Saturday.
(f) Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of the periods reported. Dividends and
distributions, if any, are assumed for purposes of this calculation to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Total
investment returns less than a full period are not annualized. Past
performance is not a guarantee of future results.
(g) Expense ratios do not reflect the effect of dividend payments to preferred
shareowners.
(h) Annualized.
The information above represents the audited operating performance data for a
share of common stock outstanding, total investment return, ratios to average
net assets of common shareowners and other supplemental data for the periods
indicated. This information has been determined based upon financial
information provided in the financial statements and market value data for the
Trust's common shares.
The accompanying notes are an integral part of these financial statements. 31
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/07
--------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer High Income Trust (the "Trust") was organized as a Delaware statutory
trust on January 30, 2002. Prior to commencing operations on April 26, 2002,
the Trust had no operations other than matters relating to its organization and
registration as a diversified, closed-end management investment company under
the Investment Company Act of 1940, as amended.
The Trust's investments in certain foreign markets or countries with limited
developing markets may subject the Trust to a greater degree of risk than in a
developed market. These risks include disruptive political or economic
conditions and the possible imposition of adverse governmental laws or currency
exchange restrictions.
Information regarding the Trust's principal risks is contained in the Trust's
original offering prospectus, with additional information included in the
Trust's Shareowner reports from time to time. Please refer to those documents
when considering the Trust's risks. At times, the Trust's investments may
represent industries or industry sectors that are interrelated or have common
risks, making it more susceptible to any economic, political, or regulatory
developments or other risks affect ing those industries or sectors. Under
normal market conditions, the Trust invests at least 80% of its assets in below
investment grade (high-yield) debt securities, loans and preferred stocks.
Because the Trust's investments will be concentrated in the high-yield
securities, it will be subject to risks of such securities. Below investment
grade securities are commonly referred to as "junk bonds" and are considered
speculative with respect to the issuer's capacity to pay interest and repay
principal.
The Trust's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Trust to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, and the reported amounts of income,
expenses and gains and losses on investments during the reporting year. Actual
results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements, which are consistent with
those policies generally accepted in the investment company industry:
32
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
A. Security Valuation
Security transactions are recorded as of trade date. Senior Loans are
valued in accordance with guidelines established by the Board of Trustees
at the mean between the last available bid and asked prices from one or
more brokers or dealers as obtained from Loan Pricing Corporation. For the
limited number of Senior Loans for which no reliable price quotes are
available, such Senior Loans will be valued by Loan Pricing Corporation
through the use of pricing matrices to determine valuations.
Fixed-income securities are valued at prices supplied by independent
pricing services, which consider such factors as Treasury spreads, yields,
maturities and ratings. Valuations may be supplemented by dealers and
other sources, as required. Equity securities are valued at the last sale
price on the principal exchanges where they are traded. Securities or
loans for which market quotations are not readily available are valued at
their fair values as determined by, or under the direction of, the Board
of Trustees. Trading in foreign securities is substantially completed each
day at various times prior to the close of the NYSE. The values of such
securities used in computing the net asset value of the Trust's shares are
determined as of such times. The Trust may also use the fair value of a
security, including a non-U.S. security, when the closing market price on
the primary exchange where the security is traded no longer accurately
reflects the value of the security as of the close of the exchange. As of
March 31, 2007, the Trust had no fair valued securities. Temporary cash
investments are valued at either amortized cost or net asset value.
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have
passed are recorded as soon as the Trust becomes aware of the ex-dividend
data in the exercise of reasonable diligence. Discount and premium on debt
securities are accreted or amortized, respectively, daily, on an effective
yield to maturity basis and are included in interest income. Premiums and
discounts related to certain mortgage-backed securities are amortized or
accreted in proportion to the underlying monthly paydowns. Interest
income, including income on interest bearing cash accounts, is recorded on
an accrual basis.
33
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Foreign Currency Translation
The books and records of the Trust are maintained in U.S. dollars. Amounts
denominated in foreign currencies are translated into U.S. dollars using
current exchange rates.
Net realized gains and losses on foreign currency transactions represent,
among other things, the net realized gains and losses on foreign currency
contracts, disposition of foreign currencies and the difference between
the amount of income accrued and the U.S. dollars actually received.
Further, the effects of changes in foreign currency exchange rates on
investments are not segregated in the Statement of Operations from the
effects of changes in market price of those securities but are included
with the net realized and unrealized gain or loss on investments.
C. Forward Foreign Currency Contracts
The Trust enters into forward foreign currency contracts (contracts) for
the purchase or sale of a specific foreign currency at a fixed price on a
future date as a hedge or cross-hedge against either specific investment
transactions (settlement hedges) or portfolio positions (portfolio
hedges). All contracts are marked to market daily at the applicable
exchange rates, and any resulting unrealized gains or losses are recorded
in the Trust's financial statements. The Trust records realized gains and
losses at the time a portfolio hedge is offset by entry into a closing
transaction or extinguished by delivery of the currency. Risks may arise
upon entering into these contracts from the potential inability of
counterparties to meet the terms of the contract and from unanticipated
movements in the value of foreign currencies relative to the U.S. dollar
(see Note 5).
D. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income and net realized capital gains, if
any, to its shareowners. Therefore, no federal income tax provision is
required.
34
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the source of the Trust's distributions may
be shown in the accompanying financial statements as either from or in
excess of net investment income or net realized gain on investment and
foreign currency transactions, or from paid-in capital, depending on the
type of book/tax differences that may exist.
At March 31, 2007, the Trust reclassified $5,765,193 to increase
undistributed net investment income and to decrease net realized gain on
investments. The reclassification has no impact on the net asset value of
the Trust and presents the Trust's capital accounts on a tax basis.
The tax character of current year distributions paid to common and
preferred shareowners the years ended March 31, 2007 and March 31, 2006
was as follows:
--------------------------------------------------------------------------------
2007 2006
--------------------------------------------------------------------------------
Distributions paid from:
Ordinary Income $51,873,934 $50,434,525
Net long-term capital gains 2,650,459 5,722,891
----------- -----------
Total taxable distribution $54,524,393 $56,157,416
=========== ===========
--------------------------------------------------------------------------------
The following shows components of distributable earnings on a federal
income tax basis at March 31, 2007.
--------------------------------------------------------------------------------
2007
--------------------------------------------------------------------------------
Undistributed ordinary income $12,689,853
Long-term capital gain 7,928,680
Dividends payable (123,078)
Unrealized appreciation 43,761,387
-----------
Total $64,256,842
===========
--------------------------------------------------------------------------------
The difference between book basis and tax basis unrealized appreciation is
primarily attributable to the tax deferral of losses on straddles and wash
sales, the realization for tax purposes of unrealized gains on certain
foreign currency contracts, the difference
35
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
between book and tax amortization methods for premiums and discounts on
fixed income securities and the accrual of income on securities in
default.
E. Repurchase Agreements
With respect to repurchase agreements entered into by the Trust, the value
of the underlying securities (collateral), including accrued interest
received from counterparties, is required to be at least equal to or in
excess of the repurchase agreement at the time of purchase. The collateral
for all repurchase agreements is held in safekeeping in the customer-only
account of the Trust's custodian, or subcustodians. Pioneer Investment
Management, Inc., the Trust's investment adviser, is responsible for
determining that the value of the collateral remains at least equal to the
repurchase price.
F. Securities Lending
The Trust lends securities in its portfolio to certain broker-dealers or
other institutional investors, with the Trust's custodian acting as the
lending agent. When entering into a loan, the Trust receives collateral
which is maintained by the custodian and earns income in the form of
negotiated lenders' fees. The Trust also continues to receive interest or
payments in lieu of dividends on the securities loaned. Unrealized gain or
loss on the fair value of the loaned securities that may occur during the
term of the loan will be for the account of the Trust. The loans are
secured by collateral of at least 102%, at all times, of the fair value of
the securities loaned. The amount of the collateral will be adjusted daily
to reflect any price fluctuation in the value of the loaned securities.
The Trust has the right under the securities lending arrangement to
recover the securities on loan from the borrower on demand. The Trust
invests cash collateral in the Securities Lending Investment Fund which is
sponsored by Brown Brothers Harriman & Co., the Trust's custodian.
G. Automatic Dividend Reinvestment Plan
All common shareowners automatically participate in the Automatic Dividend
Reinvestment Plan (the "Plan"), under which participants receive all
dividends and capital gain distributions (collectively, "dividends") in
full and fractional common shares of the Trust in
36
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
lieu of cash. Shareowners may elect not to participate in the Plan.
Shareowners not participating in the Plan receive all dividends and
capital gain distributions in cash. Participation in the Plan is
completely voluntary and may be terminated or resumed at any time without
penalty by notifying American Stock Transfer & Trust Company, the agent
for shareowners in administering the Plan (the "Plan Agent"), in writing
prior to any dividend record date; otherwise such termination or
resumption will be effective with respect to any subsequently declared
dividend or other distribution.
Whenever the Trust declares a dividend on common shares payable in cash,
participants in the Plan will receive the equivalent in common shares
acquired by the Plan Agent either (i) through receipt of additional
unissued but authorized common shares from the Trust or (ii) by purchase
of outstanding common shares on the New York Stock Exchange or elsewhere.
If, on the payment date for any dividend, the net asset value per common
share is equal to or less than the market price per share plus estimated
brokerage trading fees ("market premium"), the Plan Agent will invest the
dividend amount in newly issued common shares. The number of newly issued
common shares to be credited to each account will be determined by
dividing the dollar amount of the dividend by the net asset value per
common share on the date the shares are issued, provided that the maximum
discount from the then current market price per share on the date of
issuance does not exceed 5%. If, on the payment date for any dividend, the
net asset value per common share is greater than the market value ("market
discount"), the Plan Agent will invest the dividend amount in common
shares acquired in open-market purchases. There are no brokerage charges
with respect to newly issued common shares. However, each participant will
pay a pro rata share of brokerage trading fees incurred with respect to
the Plan Agent's open-market purchases. Participating in the Plan does not
relieve shareowners from any federal, state or local taxes which may be
due on dividends paid in any taxable year. Shareowners holding Plan shares
in a brokerage account may not be able to transfer the shares to another
broker and continue to participate in the Plan.
2. Management Agreement
Pioneer Investment Management, Inc. ("PIM"), a wholly owned indirect subsidiary
of UniCredito Italiano S.p.A. ("UniCredito Italiano") manages the Trust's
portfolio. Management fees payable under the
37
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
Trust's Advisory Agreement with PIM are calculated weekly at the annual rate of
0.60% of the Trust's average weekly managed assets. "Managed assets" is the
average weekly value of the Trust's total assets minus the sum of the Trust's
liabilities, which liabilities exclude debt related to leverage, short-term
debt and the aggregate liquidation preference of any outstanding preferred
shares. For the year ended March 31, 2007, the net management fee was
equivalent to 0.60% of the Trust's average weekly managed assets, which was
equivalent to 0.81% of the Trust's average weekly net assets attributable to
the common shareowners.
In addition, under PIM's management and administration agreements, certain
other services and costs are paid by PIM and reimbursed by the Trust. At March
31, 2007, $315,083 was payable to PIM related to management costs,
administrative costs and certain other services and is in included in "Due to
affiliate" on the Statement of Assets and Liabilities.
PIM has retained Princeton Administrators, LLC to provide certain
administrative services to the Trust on its behalf. PIM pays Princeton
Administrators, LLC a monthly fee at an annual rate of 0.07% of the average
weekly value of the Trust's managed assets, subject to a minimum monthly fee of
$10,000. Princeton Administrators, LLC receives no compensation directly from
the Trust.
3. Transfer Agents
Pioneer Investment Management Shareholder Services, Inc. ("PIMSS"), a wholly
owned indirect subsidiary of UniCredito Italiano, through a sub-transfer agency
agreement with American Stock Transfer & Trust Company, provides substantially
all transfer agent and shareowner services related to the Trust's common shares
at negotiated rates. Deutsche Bank Trust Company Americas ("Deutsche Bank") is
the transfer agent, registrar, dividend paying agent and redemption agent with
respect to the Trust's Auction Market Preferred Shares ("AMPS"). The Trust pays
Deutsche Bank an annual fee, as is agreed to from time to time by the Trust and
Deutsche Bank, for providing such services.
4. Expense Offset Arrangements
The Trust has entered into an arrangement with its custodian whereby credits
realized as a result of uninvested cash balances are used to reduce a portion
of the Trust's custodian expenses. For
38
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
the year ended March 31, 2007, the Trust expenses were reduced by $54 under
such arrangement.
5. Forward Foreign Currency Contracts
During the year ended March 31, 2007, the Trust had entered into contracts that
obligate the Trust to deliver currencies at specified future dates. At the
maturity of a contract, the Trust must make delivery of the foreign currency.
Alternatively, prior to the settlement date of contracts, the Trust may close
out such contracts by entering into an offsetting hedge contract.
Open portfolio hedges at March 31, 2007 were as follows:
----------------------------------------------------------------------------------------------
Net
Contracts Net
to (Deliver)/ In Exchange Settlement Unrealized
Currency Receive For US$ Date US$ Value Gain (Loss)
----------------------------------------------------------------------------------------------
EURO (16,800,000) $(21,230,160) 4/26/07 $(22,387,466) $(1,157,306)
EURO 16,800,000 21,836,304 4/26/07 22,387,466 551,162
EURO (16,800,000) (21,851,088) 5/11/07 (22,401,502) (550,414)
EURO (1,936,399) (2,529,983) 8/3/07 (2,589,605) (59,622)
-----------
Total $(1,216,180)
===========
----------------------------------------------------------------------------------------------
As of March 31, 2007, the Trust had no outstanding forward currency settlement
hedges.
6. Trust Shares
There are an unlimited number of common shares of beneficial interest
authorized. Of the 27,093,609 common shares of beneficial interest outstanding
at March 31, 2007 PIM owned 6,981 shares.
Transactions in common shares of beneficial interest for the years ended
March 31, 2007 and March 31, 2006 were as follows:
--------------------------------------------------------------------------------
3/2007 3/2006
--------------------------------------------------------------------------------
Shares outstanding at
beginning of year 26,931,420 26,823,948
Reinvestment of distributions 162,189 107,472
---------- ----------
Shares outstanding at
end of year 27,093,609 26,931,420
========== ==========
--------------------------------------------------------------------------------
39
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
The Trust may classify or reclassify any unissued common shares of beneficial
interest into one or more series of preferred shares of beneficial interest.
As of March 31, 2007, there were 6,040 AMPS as follows: Series M7-2,020,
Series W28-2,020 and Series TH7-2,000.
Dividends on Series M7 and Series TH7 are cumulative at a rate, which is reset
every seven days based on the results of an auction. Dividends on Series W28
are also cumulative at a rate reset every 28 days based on the results of an
auction. Dividend rates ranged from 3.65% to 5.37% during the year ended
March 31, 2007.
The Trust may not declare dividends or make other distributions on its common
shares or purchase any such shares if, at the time of the declaration,
distribution or purchase, asset coverage with respect to the outstanding
preferred shares would be less than 200%.
The AMPS are redeemable at the option of the Trust, in whole or in part, on any
dividend payment date at $25,000 per share plus any accumulated or unpaid
dividends, whether or not declared. The AMPS are also subject to mandatory
redemption at $25,000 per share plus any accumulated or unpaid dividends,
whether or not declared, if certain requirements relating to the composition of
the assets and liabilities of the Trust as set forth in the Agreement and
Declaration of Trust are not satisfied.
The holders of AMPS have voting rights equal to the holders of the Trust's
common shares (one vote per share) and will vote together with holders of the
common shares as a single class. However, holders of AMPS are also entitled to
elect two of the Trust's Trustees. In addition, the Investment Company Act of
1940, as amended, requires that along with approval by shareowners that might
otherwise be required, the approval of the holders of a majority of any
outstanding preferred shares, voting separately as a class, would be required
to (a) adopt any plan of reorganization that would adversely affect the
preferred shares and (b) take any action requiring a vote of security holders,
including, among other things, changes in the Trust's subclassification as a
closed-end management investment company or changes in its fundamental
investment restrictions.
7. New Pronouncements
On July 13, 2006, the Financial Accounting Standards Board ("FASB") released
FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN
48"). FIN 48 provides guidance for how uncertain
40
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
tax positions should be recognized, measured, presented and disclosed in the
financial statements. FIN 48 requires the evaluation of tax positions taken or
expected to be taken in the course of preparing the Trust's tax returns to
determine whether the tax positions have a "more-likely-than-not" probability
of being sustained by the applicable tax authority. Tax positions deemed to not
meet the more-likely-than-not threshold would be recorded as a tax benefit or
expense in the reporting period in which they are realized. Adoption of FIN 48
is required for fiscal years beginning after December 15, 2006 and is to be
applied to all open tax years as of no later than September 28, 2007. At this
time, management is evaluating the implications of FIN 48 and any impact in the
financial statements has not yet been determined.
In addition, in September 2006, Statement of Financial Accounting Standards No.
157, Fair Value Measurements ("SFAS 157"), was issued and is effective for
fiscal years beginning after November 15, 2007. SFAS 157 defines fair value,
establishes a framework for measuring fair value and expands disclosures about
fair value measurements. At this time, management is currently evaluating the
implications of SFAS 157 and its impact on the Trust's financial statement
disclosures, if any, has not been determined.
8. Subsequent Events
Subsequent to March 31, 2007, the Board of Trustees of the Trust declared a
dividend from undistributed net investment income of $0.1375 per common share
payable April 30, 2007, to shareowners of record on April 16, 2007.
Subsequent to March 31, 2007, dividends declared and paid on preferred shares
totaled $639,361 in aggregate for the three outstanding preferred share series
through May 17, 2007.
ADDITIONAL INFORMATION (unaudited)
During the period, there have been no material changes in the Trust's
investment objective or fundamental policies that have not been approved by the
shareowners. There have been no changes in the Trust's charter or By-Laws that
would delay or prevent a change in control of the Trust which have not been
approved by the shareowners. There have been no changes in the principal risk
factors associated with investment in the Trust. Day-to-day management of the
Trust's portfolio is the responsibility of Andrew Feltus. Mr. Feltus is
supported by the fixed income team. Members of this team
41
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/07 (continued)
--------------------------------------------------------------------------------
manage other Pioneer funds investing primarily in fixed income securities. The
portfolio manager and the team also may draw upon the research and investment
management expertise of the global research team, which provides fundamental
research on companies and includes members from Pioneer's affiliate, Pioneer
Investment Management Limited. Mr. Feltus, a vice president, joined Pioneer in
1994 and has been an investment professional for more than 10 years.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Trust may purchase, from time to time, its common
shares in the open market.
CEO CERTIFICATION DISCLOSURE (unaudited)
The Trust's Chief Executive Officer has submitted to the New York Stock
Exchange the annual CEO certification as required by Section 303A.12(a) of the
NYSE Listed Company Manual. In addition, the Trust has filed with the
Securities and Exchange Commission the certification of its Chief Executive
Officer and Chief Financial Officer required by Section 302 of the
Sarbanes-Oxley Act.
IMPORTANT TAX INFORMATION (unaudited)
The Pioneer High Income Trust paid a long-term capital gain distribution of
$0.085 per share to common shareowners of record on December 29, 2006.
Additionally, the following summarizes the per share long-term capital gain
distributions paid to preferred shareowners during the year:
--------------------------------------------------------------------------------
Long-Term
Payable Date Capital Gain
--------------------------------------------------------------------------------
Series M 12/5/2006 $24.69
Series M 12/12/2006 $24.79
Series M 12/19/2006 $ 7.26
Series W 12/28/2006 $61.06
Series TH 12/8/2006 $21.39
Series TH 12/15/2006 $17.74
Series TH 12/22/2006 $17.83
--------------------------------------------------------------------------------
42
Pioneer High Income Trust
--------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------
To the Board of Trustees and the Shareowners of
Pioneer High Income Trust:
We have audited the accompanying statement of assets and liabilities of Pioneer
High Income Trust (the "Trust"), including the schedule of investments, as of
March 31, 2007, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Trust's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material
misstatement. We were not engaged to perform an audit of the Trust's internal
control over financial reporting. Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Trust's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements and financial highlights, assessing the accounting
principles used and significant estimates made by management, and evaluating
the overall financial statement presentation. Our procedures included
confirmation of securities owned as of March 31, 2007, by correspondence with
the custodian, selling or agent banks and brokers or by other appropriate
auditing procedures where replies from brokers were not received. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Pioneer High Income Trust at March 31, 2007, the results of its operations for
the year then ended, the changes in its net assets for each of the two years in
the period then ended, and the financial highlights for each of the five years
in the period then ended, in conformity with U.S. generally accepted accounting
principles.
/s/ Ernst & Young LLP
Boston, Massachusetts
May 15, 2007
43
Pioneer High Income Trust
--------------------------------------------------------------------------------
RESULTS OF SHAREOWNER MEETING (unaudited)
--------------------------------------------------------------------------------
On September 21, 2006, Pioneer High Income Trust held its annual meeting of
shareowners to elect Class I Trustees. All Class I Trustees were elected. Here
are the detailed results of the votes.
Proposal 1 - To elect Class I Trustees.
--------------------------------------------------------------------------------
Nominee Affirmative Withheld
--------------------------------------------------------------------------------
Mary K. Bush 25,367,675 214,585
Thomas J. Perna 25,388,181 194,079
Marguerite A. Piret+ 3,894 1
--------------------------------------------------------------------------------
+ Elected by Preferred Shares only
44
Pioneer High Income Trust
--------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT
--------------------------------------------------------------------------------
The Investment Company Act of 1940 requires that both the Board of Trustees and
a majority of the Independent Trustees (collectively "the Trustees"), voting
separately, annually approve the Trust's management contract (the "Management
Contract"). The Trustees have determined that the terms of the Management
Contract are fair and reasonable and that renewal of the contract: (i) will
enable the Trust to receive quality investment advisory services at a fee
deemed reasonable; and (ii) is in the best interests of the Trust and its
shareowners. In making such determinations, the Independent Trustees relied
upon the assistance of counsel to the Independent Trustees and counsel to the
Trust.
Throughout the year, the Independent Trustees regularly met in executive
session, separately from the Interested Trustees of the Trust and any officer
of Pioneer Investment Management, Inc., the Trust's adviser (the "Investment
Adviser"), or its affiliates. While the Trustees, including the Interested
Trustees, act on all major matters relating to the Trust, a significant portion
of the activities of the Board of Trustees (including certain of those
described herein) is conducted through committees, the members of which are
comprised exclusively of Independent Trustees. Such committee meetings are
attended by officers of the Trust and/or officers of the Investment Adviser to
the extent requested by the members of the committee.
In evaluating the Management Contract, the Trustees conducted a review that was
specifically focused upon the renewal of the Management Contract, and also
relied upon their knowledge, resulting from their meetings throughout the year,
of the Investment Adviser, its services and the Trust. Both in meetings
specifically dedicated to renewal of the Management Contract and at other
meetings during the course of the year, the Trustees, including the Independent
Trustees, received materials relating to the Investment Adviser's investment
and management services under the Management Contract. These materials included
information on (i) the investment performance of the Trust, a peer group of
funds as classified by Morningstar, Inc., an independent evaluation service
("Morningstar") and an index considered appropriate by the Independent Trustees
for this purpose, (ii) the general investment outlook in the markets in which
the Trust invests, (iii) the procedures employed to determine the value of each
of the Trust's assets, (iv) the Investment Adviser's management of the
relationships with the Trust's unaffiliated service providers, (v) the record
of compliance with the Trust's investment policies and restrictions
45
Pioneer High Income Trust
--------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
--------------------------------------------------------------------------------
and with the Trust's Code of Ethics and the structure and responsibilities of
the Investment Adviser's compliance department and (vi) the nature, cost and
character of non-investment management services provided by the Investment
Adviser and its affiliates (vii) analyses of the benefits and costs of the use
of leverage through the issuance of the Trust's preferred shares and the
sensitivity of such analysis to changes in interest rates and (viii) the
discount or premium of the market price of the Trust's common stock relative to
its net asset value and measures that are or could be taken to address any
discount.
Specifically in connection with the Independent Trustees' review of the
Management Contract, the Independent Trustees requested, and the Investment
Adviser provided, additional information in order to evaluate the quality of
the Investment Adviser's services and the reasonableness of the fee under the
Management Contract. Among other items, this information included data or
analyses of (1) investment performance for one and three year periods for the
Trust and a peer group of funds selected on the basis of criteria considered
appropriate by the Independent Trustees for this purpose, (2) management and
other fees incurred by a peer group of funds selected on the basis of criteria
considered appropriate by the Independent Trustees for this purpose, (3) the
advisory fees of comparable portfolios of other clients of the Investment
Adviser, (4) expense ratios for the Trust and a peer group of funds selected on
the basis of criteria considered appropriate by the Independent Trustees for
this purpose, (5) the overall organization of the Investment Adviser, (6) the
Investment Adviser's financial results and condition, including its and certain
of its affiliates' profitability in providing services to the Trust, (7)
administrative reimbursements paid to the Investment Adviser or affiliates, (8)
investment management staffing, and (9) operating expenses paid by the funds to
third parties.
The following summarizes factors considered by the Trustees in connection with
reviewing the information described above and their renewal of the Trust's
Management Contract. The Trustees did not identify any single factor as
all-important or controlling, and the summary does not detail all the matters
that were considered.
A. Ancillary Benefits to Shareowners. The Trustees considered the benefits to
shareowners of investing in a closed-end fund that is part of an
established group of open and closed-end funds. The
46
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Trustees also noted that the relationship of the market price relative to
the Trust's net assets attributed to its common shares was comparable
relative to other closed-end funds with similar investment approaches.
B. Compliance and Investment Performance. The Trustees determined that the
Investment Adviser had policies and systems reasonably designed to achieve
compliance with the Trust's investment objective and regulatory
requirements. The Trustees also reviewed the Trust's absolute investment
performance based upon total return, as well as the Trust's performance
relative to the performance of both a peer group considered appropriate by
the Independent Trustees for this purpose and the Merrill Lynch High Yield
Master II Index. The Trust's performance, based upon total return, was in
the first quintile of its Morningstar category peer group for the 12
months ended June 30, 2006 and in the first quintile of the peer group for
the three years ended June 30, 2006. (In all quintile rankings referred to
throughout this discussion first quintile is most favorable to the Trust's
shareowners. Thus, highest relative performance would be first quintile
and lowest relative expenses also would be first quintile.) The Trustees
also considered the yield of the Trust's common shares, before deduction
of expenses, compared to the yield of the index. The Trustees, focusing on
three-year total returns, concluded that the performance of the Trust was
strong.
C. The Investment Adviser's Personnel and Methods. The Trustees reviewed the
background of members of the team responsible for the daily management of
the Trust and the Trust's investment objective and discipline. The
Independent Trustees also have had discussions with senior management of
the Investment Adviser responsible for investment operations and the
senior management of the Investment Adviser's fixed income group. Among
other things, the Trustees considered the size, education and experience
of the Investment Adviser's investment staff and their use of technology
and emphasis on analytics in view of the risk profile of securities in
which the Trust invests. The Trustees concluded that the Investment
Adviser had the quality and depth of personnel and the well-developed
methods essential to perform its duties under the Management Contract.
47
Pioneer High Income Trust
--------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
--------------------------------------------------------------------------------
D. Nature and Quality of Other Services. The Trustees considered the nature,
quality and extent of other services provided to shareowners of the Trust,
including administrative and shareowner services performed by the
Investment Adviser under the Management Contract. The Trustees also
considered the reasonableness of the arrangements for reimbursement of the
Investment Adviser's out-of-pocket costs and expenses, including overhead,
for certain administrative services that the Investment Adviser is not
required to provide under the Management Contract. The Trustees also
considered the nature and extent of the other services provided by the
Investment Adviser or its affiliates under other contracts, as well as the
Investment Adviser's supervision of third party service providers. Based
on these considerations, the Trustees concluded that the nature, quality
and extent of such services are satisfactory and reliable and serve the
shareowners of the Trust well.
E. Management Fee and Expenses. The Trustees considered the Investment
Adviser's fee under the Management Contract relative to the management
fees charged by its Morningstar category peer group. The Trust's
management fee for the 12 months ended June 30, 2006 was in the second
quintile relative to the management fees paid by the other funds in that
peer group for the comparable period. The Trustees also considered the
Trust's expense ratio for the 12 months ended June 30, 2006 and expense
ratios for the comparable period of the peer group of funds selected on
the basis of criteria considered appropriate by the Independent Trustees
for this purpose using data provided by Strategic Insight Mutual Fund
Research and Consulting, LLC, an independent third party. The Trustees
found the Trust's expense ratio for the 12 months ended June 30, 2006 to
be in the first quintile, according to data for the applicable peer group
for the most recent fiscal year.
F. Profitability. The Trustees considered the level of the Investment
Adviser's profits with respect to the management of the Pioneer funds,
including a review of the Investment Adviser's methodology in allocating
certain of its costs to the management of each fund, as well as the
financial results realized by the Investment Adviser in connection with the
operation of the Trust. They further considered the profits realized by the
Investment Adviser and its affiliates from non-fund businesses that may
benefit from or be related to the Trust's business. The Trustees considered
the Investment
48
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Adviser's profit margins in comparison with the limited industry data
available. The Trustees concluded that the Investment Adviser's profits
from management of the Pioneer funds, including the financial results
derived from the Trust, bear a reasonable relationship to the services
rendered and are fair for the management of the Trust.
G. Economies of Scale. The Trustees considered whether the Trust has
appropriately benefited from any economies of scale, and whether there is
potential for realization of any further economies of scale. Since the
Trust is a closed-end fund and its size is relatively stable and at the
level of assets that was anticipated when the management fee was initially
set, the Trustees concluded that economies of scale were not a relevant
consideration.
H. Other Benefits to the Investment Adviser. The Trustees also considered the
character and amount of fees paid by the Trust, other than under the
Management Contract, for services provided by the Investment Adviser and
affiliates. The Trustees further considered the revenues and profitability
of the Investment Adviser's businesses other than the Trust business,
including the Investment Adviser's institutional investment advisory
business. The Trustees considered the intangible benefits that accrue to
the Investment Adviser and its affiliates by virtue of its relationship
with the Trust and the Pioneer funds as a group. The Trustees concluded
that all these types of benefits accruing to the Investment Adviser were
reasonable in the context of the overall relationship between the
Investment Adviser and the Trust.
Conclusion. In light of the Investment Adviser's overall performance, the
Trustees considered it appropriate to continue to retain the management
services of the Investment Adviser. Based on their review of the overall nature
and quality of services provided by the Investment Adviser and the fees charged
by other funds in the Trust's relevant peer group, and taking into account all
material factors deemed relevant by the Trustees as well as the advice of
independent counsel, the Trustees concluded that the Management Contract with
the Trust, including the fee payable thereunder, was fair and reasonable and
that its renewal was in the best interests of the Trust and its shareholders.
Accordingly, the Trustees voted to approve the continuation of the Management
Contract for another year.
49
Pioneer High Income Trust
--------------------------------------------------------------------------------
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
--------------------------------------------------------------------------------
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Independent Registered Public Accounting Firm
Ernst & Young LLP
Legal Counsel
Wilmer Cutler Pickering Hale and Dorr LLP
Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Shareowner Services and Sub-Transfer Agent
American Stock Transfer & Trust Company
Preferred Share Auction/Transfer Agent and Registrar
Deutsche Bank Trust Company Americas
Sub-Administrator
Princeton Administrators, LLC
Trustees and Officers
The Trust's Board of Trustees provides broad supervision over the Trust's
affairs. The officers of the Trust are responsible for the Trust's operations.
The Trust's Trustees and officers are listed below, together with their
principal occupations during the past five years. Trustees who are interested
persons of the Trust within the meaning of the 1940 Act are referred to as
Interested Trustees. Trustees who are not interested persons of the Trust are
referred to as Independent Trustees. Each of the Trustees serves as a trustee
of each of the 82 U.S. registered investment portfolios for which Pioneer
serves as investment adviser (the "Pioneer Funds"). The address for all
Interested Trustees and all officers of the Trust is 60 State Street, Boston,
Massachusetts 02109.
Proxy Voting Policies and Procedures of the Trust are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Trust voted proxies relating to portfolio securities during
the most recent 12-month period ended June 30 is publicly available to
shareowners at pioneerinvestments.com. This information is also available on
the Securities and Exchange Commission's web site at http://www.sec.gov.
50
Pioneer High Income Trust
--------------------------------------------------------------------------------
INTERESTED TRUSTEES
--------------------------------------------------------------------------------
Positions Held Length of Service
Name and Age With the Trust and Term of Office
John F. Cogan, Jr. (80)* Chairman of the Class II
Board, Trustee and Trustee since
President 2002. Term
expires in 2007.
Elected by
Preferred
Shares only.
--------------------------------------------------------------------------------
Daniel K. Kingsbury (48)* Trustee and Class III
Executive Vice Trustee since
President 2007. Term
expires in 2007.
--------------------------------------------------------------------------------
Other Directorships Held
Name and Age Principal Occupation During Past Five Years by this Trustee
John F. Cogan, Jr. (80)* Deputy Chairman and a Director of Pioneer Global Asset Director of ICI Mutual
Management S.p.A. ("PGAM"); Non-Executive Chairman Insurance Company
and a Director of Pioneer Investment Management USA
Inc. ("PIM-USA"); Chairman and a Director of Pioneer;
Chairman and Director of Pioneer Institutional Asset
Management, Inc. (since 2006); Director of Pioneer
Alternative Investment Management Limited (Dublin);
President and a Director of Pioneer Alternative
Investment Management (Bermuda) Limited and
affiliated funds; Director of PIOGLOBAL Real Estate
Investment Fund (Russia) (until June 2006); Director
of Nano-C, Inc. (since 2003); Director of Cole
Management Inc. (since 2004); Director of Fiduciary
Counseling, Inc.; President and Director of Pioneer
Funds Distributor, Inc. ("PFD") (until May 2006);
President of all of the Pioneer Funds; and of Counsel,
Wilmer Cutler Pickering Hale and Dorr LLP (counsel to
PIM-USA and the Pioneer Funds)
------------------------------------------------------------------------------------------------------------------
Daniel K. Kingsbury (48)* Director, CEO and President of Pioneer Investment None
Management USA Inc.; Pioneer Investment
Management, Inc. and Pioneer Institutional
Asset Management, Inc. (since March 2007); Executive
Vice President of all of the Pioneer Funds (since
March 2007); Director of Pioneer Global Asset
Management S.p.A. (since March 2007); Head of New
Markets Division, Pioneer Global Asset Management
S.p.A. (2000 - 2007)
------------------------------------------------------------------------------------------------------------------
* Mr. Cogan and Mr. Kingsbury are Interested Trustees because they are an
officer or director of the Trust's investment adviser and certain of its
affiliates.
51
Pioneer High Income Trust
--------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
--------------------------------------------------------------------------------
Positions Held Length of Service
Name, Age and Address With the Trust and Term of Office
David R. Bock (63) Trustee Class II
3050 K Street NW, Trustee since
Washington, DC 20007 2005. Term
expires in 2007.
--------------------------------------------------------------------------------
Mary K. Bush (58) Trustee Class I
3509 Woodbine Street Trustee since
Chevy Chase, MD 20815 2002. Term
expires in 2009.
--------------------------------------------------------------------------------
Margaret B.W. Graham (59) Trustee Class III
1001 Sherbrooke Street West, Trustee since
Montreal, Quebec, Canada 2002. Term
H3A 1G5 expires in 2008.
--------------------------------------------------------------------------------
Other Directorships Held
Name, Age and Address Principal Occupation During Past Five Years by this Trustee
David R. Bock (63) Executive Vice President and Chief Financial Officer, Director of The
3050 K Street NW, I-trax, Inc. (publicly traded health care services Enterprise Social
Washington, DC 20007 company) (2004 - present); Partner, Federal City Investment Company
Capital Advisors (boutique merchant bank) (1997 to (privately-held affordable
2004); and Executive Vice President and Chief Financial housing finance
Officer, Pedestal Inc. (internet-based mortgage trading company); and Director
company) (2000 - 2002) of New York Mortgage
Trust (publicly traded
mortgage REIT)
--------------------------------------------------------------------------------------------------------------------
Mary K. Bush (58) President, Bush International, LLC (international Director of Brady
3509 Woodbine Street financial advisory firm) Corporation (industrial
Chevy Chase, MD 20815 identification and
specialty coated
material products
manufacturer); Director
of Briggs & Stratton Co.
(engine manufacturer);
Director of UAL
Corporation (airline
holding company);
and Director of
Mantech International
Corporation (national
security, defense,
and intelligence
technology firm)
--------------------------------------------------------------------------------------------------------------------
Margaret B.W. Graham (59) Founding Director, Vice-President and Corporate None
1001 Sherbrooke Street West, Secretary, The Winthrop Group, Inc. (consulting firm);
Montreal, Quebec, Canada and Desautels Faculty of Management, McGill University
H3A 1G5
--------------------------------------------------------------------------------------------------------------------
52
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Positions Held Length of Service
Name, Age and Address With the Trust and Term of Office
Thomas J. Perna (56) Trustee Class I
89 Robbins Avenue, Trustee since
Berkeley Heights, NJ 07922 February 2006.
Term expires
in 2009.
--------------------------------------------------------------------------------
Marguerite A. Piret (58) Trustee Class I
200 State Street, 12th Floor, Trustee since
Boston, MA 02109 2002. Term
expires in 2009.
Elected by
Preferred
Shares only.
--------------------------------------------------------------------------------
Stephen K. West (78) Trustee Class II
125 Broad Street, Trustee since
New York, NY 10004 2002. Term
expires in 2007.
--------------------------------------------------------------------------------
John Winthrop (70) Trustee Class III
One North Adgers Wharf, Trustee since
Charleston, SC 29401 2002. Term
expires in 2008.
--------------------------------------------------------------------------------
Other Directorships Held
Name, Age and Address Principal Occupation During Past Five Years by this Trustee
Thomas J. Perna (56) Private investor (2004 - present); and Senior Executive Director of Quadriserv
89 Robbins Avenue, Vice President, The Bank of New York (financial and Inc. (technology
Berkeley Heights, NJ 07922 securities services) (1986 - 2004) products for securities
lending industry)
-------------------------------------------------------------------------------------------------------------------
Marguerite A. Piret (58) President and Chief Executive Officer, Newbury, Piret & Director of New America
200 State Street, 12th Floor, Company, Inc. (investment banking firm) High Income Fund, Inc.
Boston, MA 02109 (closed-end investment
company)
-------------------------------------------------------------------------------------------------------------------
Stephen K. West (78) Senior Counsel, Sullivan & Cromwell (law firm) Director, The Swiss
125 Broad Street, Helvetia Fund, Inc.
New York, NY 10004 (closed-end investment
company)
-------------------------------------------------------------------------------------------------------------------
John Winthrop (70) President, John Winthrop & Co., Inc. (private None
One North Adgers Wharf, investment firm)
Charleston, SC 29401
-------------------------------------------------------------------------------------------------------------------
53
Pioneer High Income Trust
--------------------------------------------------------------------------------
FUND OFFICERS
--------------------------------------------------------------------------------
Positions Held Length of Service
Name and Age With the Trust and Term of Office
Dorothy E. Bourassa (59) Secretary Since 2002. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Christopher J. Kelley (42) Assistant Secretary Since 2003. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Christopher P. Harvey (45) Assistant Secretary Since 2006. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Vincent Nave (61) Treasurer Since 2002. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Mark E. Bradley (47) Assistant Treasurer Since 2004. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Luis I. Presutti (42) Assistant Treasurer Since 2002. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Other Directorships Held
Name and Age Principal Occupation During Past Five Years by this Officer
Dorothy E. Bourassa (59) Secretary of PIM-USA; Senior Vice President - Legal None
of Pioneer; Secretary/Clerk of most of PIM-USA's
subsidiaries; and Secretary of all of the Pioneer Funds
since September 2003 (Assistant Secretary from
November 2000 to September 2003)
----------------------------------------------------------------------------------------------------------------
Christopher J. Kelley (42) Vice President and Senior Counsel of Pioneer since None
July 2002; Vice President and Senior Counsel of BISYS
Fund Services, Inc. (April 2001 to June 2002); Senior
Vice President and Deputy General Counsel of Funds
Distributor, Inc. (July 2000 to April 2001), and
Assistant Secretary of all of the Pioneer Funds since
September 2003
----------------------------------------------------------------------------------------------------------------
Christopher P. Harvey (45) Partner, Wilmer Cutler Pickering Hale and Dorr LLP; and None
Assistant Secretary of all of the Pioneer Funds since
July 2006
----------------------------------------------------------------------------------------------------------------
Vincent Nave (61) Vice President - Fund Accounting, Administration and None
Controllership Services of Pioneer; and Treasurer of all
of the Pioneer Funds
----------------------------------------------------------------------------------------------------------------
Mark E. Bradley (47) Deputy Treasurer of Pioneer since 2004; Treasurer and None
Senior Vice President, CDC IXIS Asset Management
Services from 2002 to 2003; and Assistant Treasurer
of all of the Pioneer Funds since November 2004
----------------------------------------------------------------------------------------------------------------
Luis I. Presutti (42) Director of Fund Administration of Pioneer; and None
Assistant Treasurer of all of the Pioneer Funds
----------------------------------------------------------------------------------------------------------------
54
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Positions Held Length of Service
Name and Age With the Trust and Term of Office
Gary Sullivan (48) Assistant Treasurer Since 2002. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Katherine Kim Sullivan (33) Assistant Treasurer Since 2003. Serves
at the discretion of
the Board
--------------------------------------------------------------------------------
Teri W. Anderholm (47) Chief Compliance Since January 2007.
Officer Serves at the
discretion of the
Board
--------------------------------------------------------------------------------
Other Directorships Held
Name and Age Principal Occupation During Past Five Years by this Officer
Gary Sullivan (48) Fund Accounting Manager - Fund Accounting, None
Administration and Controllership Services of Pioneer;
and Assistant Treasurer of all of the Pioneer Funds
since May 2002
--------------------------------------------------------------------------------------------------------------
Katherine Kim Sullivan (33) Fund Administration Manager - Fund Accounting, None
Administration and Controllership Services since
June 2003; Assistant Vice President - Mutual Fund
Operations of State Street Corporation from June 2002
to June 2003 (formerly Deutsche Bank Asset
Management); Pioneer Fund Accounting, Administration
and Controllership Services (Fund Accounting
Manager from August 1999 to May 2002); and
Assistant Treasurer of all of the Pioneer Funds since
September 2003
--------------------------------------------------------------------------------------------------------------
Teri W. Anderholm (47) Chief Compliance Officer of Pioneer since None
December 2006 and of all the Pioneer Funds since
January 2007; Vice President and Compliance Officer,
MFS Investment Management (August 2005 to
December 2006); Consultant, Fidelity Investments
(February 2005 to July 2005): Independent Consultant
(July 1997 to February 2005)
--------------------------------------------------------------------------------------------------------------
The outstanding capital stock of PFD, Pioneer and PIMSS is indirectly wholly
owned by UniCredito Italiano S.p.A. ("UniCredito Italiano"), one of the largest
banking groups in Italy. Pioneer, the Trust's investment adviser, provides
investment management and financial services to mutual funds, institutional and
other clients.
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HOW TO CONTACT PIONEER
--------------------------------------------------------------------------------
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
You can call American Stock Transfer & Trust Company (AST) for:
Account Information 1-800-710-0935
Or write to AST:
For Write to
General inquiries, lost dividend checks, American Stock
change of address, lost stock certificates, Transfer & Trust
stock transfer Operations Center
6201 15th Ave.
Brooklyn, NY 11219
Dividend reinvestment plan (DRIP) American Stock
Transfer & Trust
Wall Street Station
P.O. Box 922
New York, NY 10269-0560
Website www.amstock.com
For additional information, please contact your investment advisor or visit
our web site www.pioneerinvestments.com.
The Trust files a complete statement of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareowners may view the filed Form N-Q by visiting the Commission's
web site at http://www.sec.gov. The filed form may also be viewed and copied
at the Commission's Public Reference Room in Washington, DC. Information
regarding the operations of the Public Reference Room may be obtained by
calling 1-800-SEC-0330.
The Trust's Chief Executive Officer is required by the New York Stock
Exchange's Listing Standards to file annually with the Exchange a
certification that he is not aware of any violation by the Trust of the
Exchange's Corporate Governance Standards applicable to the Trust. The Trust
has filed such certification.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
Audit Fees
Fees for audit services provided to the Trust, including fees
associated with the filings to update its Form N-2 and issuance
of comfort letters, totaled approximately $38,545 in 2007 and
$23,920 in 2006.
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
Audit-Related Fees
Fees for the Trusts audit-related services totaled
approximately $9,285 in 2007 and $8,500 in 2006, which were
related to the issuance of agreed upon procedures report to the
rating agencies.
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
Tax Fees
Fees for tax compliance services, primarily for tax returns,
totaled approximately $7,820 and $6,800 for 2007 and 2006,
respectively.
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
Other Fees
There were no fees for other services provided to the Trust
during the fiscal years ended March 31, 2007 and 2006.
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
Non-Audit Services
Beginning with non-audit service contracts entered into on or
after May 6, 2003, the effective date of the new SEC pre-
approval rules, the Trusts audit committee is required to pre-
approve services to affiliates defined by SEC rules to the
extent that the services are determined to have a direct impact
on the operations or financial reporting of the Trust. For the
years ended March 31, 2007 and 2006, there were no services
provided to an affiliate that required the Trusts audit
committee pre-approval.
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
The aggregate non-audit fees for the Trust and affiliates, as
previously defined, totaled approximately $17,110 in 2007 and
$15,300 in 2006.
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
The Trust's audit committee of the Board of Trustees has
considered whether the provision of non-audit services that
were rendered to the Affiliates (as defined) that were not pre-
approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of
Regulation S-X is compatible with maintaining the principal
accountant's independence.
Item 5. Audit Committee of Listed Registrants
(a) If the registrant is a listed issuer as defined in Rule 10A-3
under the Exchange Act (17 CFR 240.10A-3), state whether
or not the registrant has a separately-designated standing
audit committee established in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
If the registrant has such a committee, however designated,
identify each committee member. If the entire board of directors
is acting as the registrants audit committee as specified in
Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)),
so state.
The registrant has a separately-designated standing audit
committe eestablished in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
(b) If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act (17 CFR 240.10A-3(d)) regarding an exemption
from the listing standards for audit committees.
N/A
Item 6. Schedule of Investments.
File Schedule I Investments in securities of unaffiliated issuers
as of the close of the reporting period as set forth in 210.12-
12 of Regulation S-X [17 CFR 210.12-12], unless the schedule is
included as part of the report to shareholders filed under Item
1 of this Form.
Included in Item 1
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Proxy Voting Policies and Procedures of
Pioneer Investment Management, Inc.
VERSION DATED July, 2004
Overview
Pioneer Investment Management, Inc. ("Pioneer") is a fiduciary that owes
each of its client's duties of care and loyalty with respect to all
services undertaken on the client's behalf, including proxy voting. When
Pioneer has been delegated proxy-voting authority for a client, the duty of
care requires Pioneer to monitor corporate events and to vote the proxies.
To satisfy its duty of loyalty, Pioneer must place its client's interests
ahead of its own and must cast proxy votes in a manner consistent with the
best interest of its clients. Pioneer will vote all proxies presented in a
timely manner.
The Proxy Voting Policies and Procedures are designed to complement
Pioneer's investment policies and procedures regarding its general
responsibility to monitor the performance and/or corporate events of
companies that are issuers of securities held in accounts managed by
Pioneer. Pioneer's Proxy Voting Policies summarize Pioneer's position on a
number of issues solicited by companies held by Pioneer's clients. The
policies are guidelines that provide a general indication on how Pioneer
would vote but do not include all potential voting scenarios.
Pioneer's Proxy Voting Procedures detail monitoring of voting, exception
votes, and review of conflicts of interest and ensure that case-by-case
votes are handled within the context of the overall guidelines (i.e. best
interest of client). The overriding goal is that all proxies for US and
non-US companies that are received promptly will be voted in accordance
with Pioneer's policies or specific client instructions. All shares in a
company held by Pioneer-managed accounts will be voted alike, unless a
client has given us specific voting instructions on an issue or has not
delegated authority to us or the Proxy Voting Oversight Group determines
that the circumstances justify a different approach.
Pioneer does not delegate the authority to vote proxies relating to its
clients to any of its affiliates, which include other subsidiaries of
UniCredito.
Any questions about these policies and procedures should be directed to the
Proxy Coordinator.
1
Proxy Voting Procedures
Proxy Voting Service
Pioneer has engaged an independent proxy voting service to assist in the
voting of proxies. The proxy voting service works with custodians to ensure
that all proxy materials are received by the custodians and are processed
in a timely fashion. To the extent applicable, the proxy voting service
votes all proxies in accordance with the proxy voting policies established
by Pioneer. The proxy voting service will refer proxy questions to the
Proxy Coordinator (described below) for instructions under circumstances
where: (1) the application of the proxy voting guidelines is unclear; (2) a
particular proxy question is not covered by the guidelines; or (3) the
guidelines call for specific instructions on a case-by-case basis. The
proxy voting service is also requested to call to the Proxy Coordinator's
attention specific proxy questions that, while governed by a guideline,
appear to involve unusual or controversial issues. Pioneer reserves the
right to attend a meeting in person and may do so when it determines that
the company or the matters to be voted on at the meeting are strategically
important to its clients.
Proxy Coordinator
Pioneer's Director of Investment Operations (the "Proxy Coordinator")
coordinates the voting, procedures and reporting of proxies on behalf of
Pioneer's clients. The Proxy Coordinator will deal directly with the proxy
voting service and, in the case of proxy questions referred by the proxy
voting service, will solicit voting recommendations and instructions from
the Director of Portfolio Management US or, to the extent applicable,
investment sub-advisers. The Proxy Coordinator is responsible for ensuring
that these questions and referrals are responded to in a timely fashion and
for transmitting appropriate voting instructions to the proxy voting
service. The Proxy Coordinator is responsible for verifying with the
Compliance Department whether Pioneer's voting power is subject to any
limitations or guidelines issued by the client (or in the case of an
employee benefit plan, the plan's trustee or other fiduciaries).
Referral Items
From time to time, the proxy voting service will refer proxy questions to
the Proxy Coordinator that are described by Pioneer's policy as to be voted
on a case-by-case basis, that are not covered by Pioneer's guidelines or
where Pioneer's guidelines may be unclear with respect to the matter to be
voted on. Under such certain circumstances, the Proxy Coordinator will seek
a written voting recommendation from the Director of Portfolio Management
US. Any such recommendation will include: (i) the manner in which the
proxies should be voted; (ii) the rationale underlying any such decision;
and (iii) the disclosure of any contacts or communications made between
Pioneer and any outside parties concerning the proxy proposal prior to the
time that the voting instructions are provided. In addition, the Proxy
Coordinator will ask the Compliance Department to review the question for
any actual or apparent conflicts of interest as described below under
"Conflicts of
2
Interest." The Compliance Department will provide a "Conflicts of Interest
Report," applying the criteria set forth below under "Conflicts of
Interest," to the Proxy Coordinator summarizing the results of its review.
In the absence of a conflict of interest, the Proxy Coordinator will vote
in accordance with the recommendation of the Director of Portfolio
Management US.
If the matter presents a conflict of interest for Pioneer, then the Proxy
Coordinator will refer the matter to the Proxy Voting Oversight Group for a
decision. In general, when a conflict of interest is present, Pioneer will
vote according to the recommendation of the Director of Portfolio
Management US where such recommendation would go against Pioneer's interest
or where the conflict is deemed to be immaterial. Pioneer will vote
according to the recommendation of its proxy voting service when the
conflict is deemed to be material and the Pioneer's internal vote
recommendation would favor Pioneer's interest, unless a client specifically
requests Pioneer to do otherwise. When making the final determination as to
how to vote a proxy, the Proxy Voting Oversight Group will review the
report from the Director of Portfolio Management US and the Conflicts of
Interest Report issued by the Compliance Department.
Conflicts of Interest
A conflict of interest occurs when Pioneer's interests interfere, or appear
to interfere with the interests of Pioneer's clients. Occasionally, Pioneer
may have a conflict that can affect how its votes proxies. The conflict may
be actual or perceived and may exist when the matter to be voted on
concerns:
o An affiliate of Pioneer, such as another company belonging to
the UniCredito Italiano S.p.A. banking group (a "UniCredito
Affiliate");
o An issuer of a security for which Pioneer acts as a sponsor,
advisor, manager, custodian, distributor, underwriter, broker, or
other similar capacity (including those securities specifically
declared by PGAM to present a conflict of interest for Pioneer);
o An issuer of a security for which UniCredito has informed Pioneer
that a UniCredito Affiliate acts as a sponsor, advisor, manager,
custodian, distributor, underwriter, broker, or other similar
capacity; or
o A person with whom Pioneer (or any of its affiliates) has an
existing, material contract or business relationship that was not
entered into in the ordinary course of Pioneer's business.
o Pioneer will abstain from voting with respect to companies
directly or indirectly owned by UniCredito Italiano Group, unless
otherwise directed by a client. In addition, Pioneer will inform
PGAM Global Compliance and the PGAM Independent Directors before
exercising such rights.
Any associate involved in the proxy voting process with knowledge of any
apparent or actual conflict of interest must disclose such conflict to the
Proxy Coordinator and the Compliance Department. The Compliance Department
will review each item referred to Pioneer to determine whether an actual or
potential conflict of interest with Pioneer exists in connection with the
proposal(s) to be voted upon. The review will be conducted by comparing the
apparent parties affected by the proxy proposal being
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voted upon against the Compliance Department's internal list of interested
persons and, for any matches found, evaluating the anticipated magnitude
and possible probability of any conflict of interest being present. For
each referral item, the determination regarding the presence or absence of
any actual or potential conflict of interest will be documented in a
Conflicts of Interest Report to the Proxy Coordinator.
Securities Lending
In conjunction with industry standards Proxies are not available to be
voted when the shares are out on loan through either Pioneer's lending
program or a client's managed security lending program. However, Pioneer
will reserve the right to recall lent securities so that they may be voted
according to the Pioneer's instructions. If a portfolio manager would like
to vote a block of previously lent shares, the Proxy Coordinator will work
with the portfolio manager and Investment Operations to recall the
security, to the extent possible, to facilitate the vote on the entire
block of shares.
Share-Blocking
"Share-blocking" is a market practice whereby shares are sent to a
custodian (which may be different than the account custodian) for record
keeping and voting at the general meeting. The shares are unavailable for
sale or delivery until the end of the blocking period (typically the day
after general meeting date).
Pioneer will vote in those countries with "share-blocking." In the event a
manager would like to sell a security with "share-blocking", the Proxy
Coordinator will work with the Portfolio Manager and Investment Operations
Department to recall the shares (as allowable within the market time-frame
and practices) and/or communicate with executing brokerage firm. A list of
countries with "share-blocking" is available from the Investment Operations
Department upon request.
Record Keeping
The Proxy Coordinator shall ensure that Pioneer's proxy voting service:
o Retains a copy of the proxy statement received (unless the proxy
statement is available from the SEC's Electronic Data Gathering,
Analysis, and Retrieval (EDGAR) system);
o Retains a record of the vote cast;
o Prepares Form N-PX for filing on behalf of each client that is a
registered investment company; and
o Is able to promptly provide Pioneer with a copy of the voting
record upon its request.
4
The Proxy Coordinator shall ensure that for those votes that may require
additional documentation (i.e. conflicts of interest, exception votes and
case-by-case votes) the following records are maintained:
o A record memorializing the basis for each referral vote cast;
o A copy of any document created by Pioneer that was material in
making the decision on how to vote the subject proxy; and
o A copy of any conflict notice, conflict consent or any other
written communication (including emails or other electronic
communications) to or from the client (or in the case of an
employee benefit plan, the plan's trustee or other fiduciaries)
regarding the subject proxy vote cast by, or the vote
recommendation of, Pioneer.
o Pioneer shall maintain the above records in the client's file for a
period not less than ten (10) years.
Disclosure
Pioneer shall take reasonable measures to inform its clients of the process
or procedures clients must follow to obtain information regarding how
Pioneer voted with respect to assets held in their accounts. In addition,
Pioneer shall describe to clients its proxy voting policies and procedures
and will furnish a copy of its proxy voting policies and procedures upon
request. This information may be provided to clients through Pioneer's Form
ADV (Part II) disclosure, by separate notice to the client, or through
Pioneer's website.
Proxy Voting Oversight Group
The members of the Proxy Voting Oversight Group are Pioneer's: Director of
Portfolio Management US, Head of Investment Operations, and Director of
Compliance. Other members of Pioneer will be invited to attend meetings and
otherwise participate as necessary. The Head of Investment Operations will
chair the Proxy Voting Oversight Group.
The Proxy Voting Oversight Group is responsible for developing, evaluating,
and changing (when necessary) Pioneer's Proxy Voting Policies and
Procedures. The group meets at least annually to evaluate and review these
policies and procedures and the services of its third-party proxy voting
service. In addition, the Proxy Voting Oversight Group will meet as
necessary to vote on referral items and address other business as
necessary.
Amendments
Pioneer may not amend its Proxy Voting Policies And Procedures without the
prior approval of the Proxy Voting Oversight Group and its corporate
parent, Pioneer Global Asset Management S.p.A
5
Proxy Voting Policies
Pioneer's sole concern in voting proxies is the economic effect of the
proposal on the value of portfolio holdings, considering both the short-
and long-term impact. In many instances, Pioneer believes that supporting
the company's strategy and voting "for" management's proposals builds
portfolio value. In other cases, however, proposals set forth by management
may have a negative effect on that value, while some shareholder proposals
may hold the best prospects for enhancing it. Pioneer monitors developments
in the proxy-voting arena and will revise this policy as needed.
All proxies that are received promptly will be voted in accordance with the
specific policies listed below. All shares in a company held by
Pioneer-managed accounts will be voted alike, unless a client has given us
specific voting instructions on an issue or has not delegated authority to
us. Proxy voting issues will be reviewed by Pioneer's Proxy Voting
Oversight Group, which consists of the Director of Portfolio Management US,
the Director of Investment Operations (the Proxy Coordinator), and the
Director of Compliance.
Pioneer has established Proxy Voting Procedures for identifying and
reviewing conflicts of interest that may arise in the voting of proxies.
Clients may request, at any time, a report on proxy votes for securities
held in their portfolios and Pioneer is happy to discuss our proxy votes
with company management. Pioneer retains a proxy voting service to provide
research on proxy issues and to process proxy votes.
Administrative
While administrative items appear infrequently in U.S. issuer proxies, they
are quite common in non-U.S. proxies.
We will generally support these and similar management proposals:
o Corporate name change.
o A change of corporate headquarters.
o Stock exchange listing.
o Establishment of time and place of annual meeting.
o Adjournment or postponement of annual meeting.
o Acceptance/approval of financial statements.
o Approval of dividend payments, dividend reinvestment plans and other
dividend-related proposals.
o Approval of minutes and other formalities.
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o Authorization of the transferring of reserves and allocation of
income.
o Amendments to authorized signatories.
o Approval of accounting method changes or change in fiscal year-end.
o Acceptance of labor agreements.
o Appointment of internal auditors.
Pioneer will vote on a case-by-case basis on other routine business;
however, Pioneer will oppose any routine business proposal if insufficient
information is presented in advance to allow Pioneer to judge the merit of
the proposal. Pioneer has also instructed its proxy voting service to
inform Pioneer of its analysis of any administrative items inconsistent, in
its view, with supporting the value of Pioneer portfolio holdings so that
Pioneer may consider and vote on those items on a case-by-case basis.
Auditors
We normally vote for proposals to:
o Ratify the auditors. We will consider a vote against if we are
concerned about the auditors' independence or their past work for
the company. Specifically, we will oppose the ratification of
auditors and withhold votes from audit committee members if
non-audit fees paid by the company to the auditing firm exceed the
sum of audit fees plus audit-related fees plus permissible tax
fees according to the disclosure categories proposed by the
Securities and Exchange Commission.
o Restore shareholder rights to ratify the auditors.
We will normally oppose proposals that require companies to:
o Seek bids from other auditors.
o Rotate auditing firms, except where the rotation is statutorily
required or where rotation would demonstrably strengthen financial
disclosure.
o Indemnify auditors.
o Prohibit auditors from engaging in non-audit services for the
company.
Board of Directors
On issues related to the board of directors, Pioneer normally supports
management. We will, however, consider a vote against management in
instances where corporate performance has been very poor or where the board
appears to lack independence.
7
General Board Issues
Pioneer will vote for:
o Audit, compensation and nominating committees composed of
independent directors exclusively.
o Indemnification for directors for actions taken in good faith in
accordance with the business judgment rule. We will vote against
proposals for broader indemnification.
o Changes in board size that appear to have a legitimate business
purpose and are not primarily for anti-takeover reasons.
o Election of an honorary director.
We will vote against:
o Minimum stock ownership by directors.
o Term limits for directors. Companies benefit from experienced
directors, and shareholder control is better achieved through
annual votes.
o Requirements for union or special interest representation on the
board.
o Requirements to provide two candidates for each board seat.
We will vote on a case-by case basis on these issues:
o Separate chairman and CEO positions. We will consider voting with
shareholders on these issues in cases of poor corporate
performance.
Elections of Directors
In uncontested elections of directors we will vote against:
o Individual directors with absenteeism above 25% without valid
reason. We support proposals that require disclosure of director
attendance.
o Insider directors and affiliated outsiders who sit on the audit,
compensation, stock option or nominating committees. For the
purposes of our policy, we accept the definition of affiliated
directors provided by our proxy voting service.
We will also vote against:
o Directors who have failed to act on a takeover offer where the
majority of shareholders have tendered their shares.
o Directors who appear to lack independence or are associated with
very poor corporate performance.
8
We will vote on a case-by case basis on these issues:
o Re-election of directors who have implemented or renewed a
dead-hand or modified dead-hand poison pill (a "dead-hand poison
pill" is a shareholder rights plan that may be altered only by
incumbent or "dead " directors. These plans prevent a potential
acquirer from disabling a poison pill by obtaining control of the
board through a proxy vote).
o Contested election of directors.
o Prior to phase-in required by SEC, we would consider supporting
election of a majority of independent directors in cases of poor
performance.
o Mandatory retirement policies.
o Directors who have ignored a shareholder proposal that has been
approved by shareholders for two consecutive years.
Takeover-Related Measures
Pioneer is generally opposed to proposals that may discourage takeover
attempts. We believe that the potential for a takeover helps ensure that
corporate performance remains high.
Pioneer will vote for:
o Cumulative voting.
o Increase ability for shareholders to call special meetings.
o Increase ability for shareholders to act by written consent.
o Restrictions on the ability to make greenmail payments.
o Submitting rights plans to shareholder vote.
o Rescinding shareholder rights plans ("poison pills").
o Opting out of the following state takeover statutes:
o Control share acquisition statutes, which deny large holders voting
rights on holdings over a specified threshold.
o Control share cash-out provisions, which require large holders to
acquire shares from other holders.
o Freeze-out provisions, which impose a waiting period on large
holders before they can attempt to gain control.
o Stakeholder laws, which permit directors to consider interests of
non-shareholder constituencies.
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o Disgorgement provisions, which require acquirers to disgorge profits
on purchases made before gaining control.
o Fair price provisions.
o Authorization of shareholder rights plans.
o Labor protection provisions.
o Mandatory classified boards.
We will vote on a case-by-case basis on the following issues:
o Fair price provisions. We will vote against provisions requiring
supermajority votes to approve takeovers. We will also consider
voting against proposals that require a supermajority vote to
repeal or amend the provision. Finally, we will consider the
mechanism used to determine the fair price; we are generally
opposed to complicated formulas or requirements to pay a premium.
o Opting out of state takeover statutes regarding fair price
provisions. We will use the criteria used for fair price
provisions in general to determine our vote on this issue.
o Proposals that allow shareholders to nominate directors.
We will vote against:
o Classified boards, except in the case of closed-end mutual funds.
o Limiting shareholder ability to remove or appoint directors. We
will support proposals to restore shareholder authority in this
area. We will review on a case-by-case basis proposals that
authorize the board to make interim appointments.
o Classes of shares with unequal voting rights.
o Supermajority vote requirements.
o Severance packages ("golden" and "tin" parachutes). We will support
proposals to put these packages to shareholder vote.
o Reimbursement of dissident proxy solicitation expenses. While we
ordinarily support measures that encourage takeover bids, we
believe that management should have full control over corporate
funds.
o Extension of advance notice requirements for shareholder proposals.
o Granting board authority normally retained by shareholders (e.g.,
amend charter, set board size).
o Shareholder rights plans ("poison pills"). These plans generally
allow shareholders to buy additional shares at a below-market
price in the event of a change in control and may deter some bids.
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Capital Structure
Managements need considerable flexibility in determining the company's
financial structure, and Pioneer normally supports managements' proposals
in this area. We will, however, reject proposals that impose high barriers
to potential takeovers.
Pioneer will vote for:
o Changes in par value.
o Reverse splits, if accompanied by a reduction in number of shares.
o Share repurchase programs, if all shareholders may participate on
equal terms.
o Bond issuance.
o Increases in "ordinary" preferred stock.
o Proposals to have blank-check common stock placements (other than
shares issued in the normal course of business) submitted for
shareholder approval.
o Cancellation of company treasury shares.
We will vote on a case-by-case basis on the following issues:
o Reverse splits not accompanied by a reduction in number of shares,
considering the risk of delisting.
o Increase in authorized common stock. We will make a determination
considering, among other factors:
o Number of shares currently available for issuance;
o Size of requested increase (we would normally approve increases of up to
100% of current authorization);
o Proposed use of the additional shares; and
o Potential consequences of a failure to increase the number of shares
outstanding (e.g., delisting or bankruptcy).
o Blank-check preferred. We will normally oppose issuance of a new
class of blank-check preferred, but may approve an increase in a
class already outstanding if the company has demonstrated that it
uses this flexibility appropriately.
o Proposals to submit private placements to shareholder vote.
o Other financing plans.
We will vote against preemptive rights that we believe limit a company's
financing flexibility.
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Compensation
Pioneer supports compensation plans that link pay to shareholder returns
and believes that management has the best understanding of the level of
compensation needed to attract and retain qualified people. At the same
time, stock-related compensation plans have a significant economic impact
and a direct effect on the balance sheet. Therefore, while we do not want
to micromanage a company's compensation programs, we will place limits on
the potential dilution these plans may impose.
Pioneer will vote for:
o 401(k) benefit plans.
o Employee stock ownership plans (ESOPs), as long as shares
allocated to ESOPs are less than 5% of outstanding shares. Larger
blocks of stock in ESOPs can serve as a takeover defense. We will
support proposals to submit ESOPs to shareholder vote.
o Various issues related to the Omnibus Budget and Reconciliation Act
of 1993 (OBRA), including:
o Amendments to performance plans to conform with OBRA;
o Caps on annual grants or amendments of administrative features;
o Adding performance goals; and
o Cash or cash-and-stock bonus plans.
o Establish a process to link pay, including stock-option grants, to
performance, leaving specifics of implementation to the company.
o Require that option repricings be submitted to shareholders.
o Require the expensing of stock-option awards.
o Require reporting of executive retirement benefits (deferred
compensation, split-dollar life insurance, SERPs, and pension
benefits).
o Employee stock purchase plans where the purchase price is equal to
at least 85% of the market price, where the offering period is no
greater than 27 months and where potential dilution (as defined
below) is no greater than 10%.
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We will vote on a case-by-case basis on the following issues:
o Executive and director stock-related compensation plans. We will
consider the following factors when reviewing these plans:
o The program must be of a reasonable size. We will approve plans
where the combined employee and director plans together would
generate less than 15% dilution. We will reject plans with 15% or
more potential dilution.
Dilution = (A + B + C) / (A + B + C + D), where
A = Shares reserved for plan/amendment,
B = Shares available under continuing plans,
C = Shares granted but unexercised and
D = Shares outstanding.
o The plan must not:
o Explicitly permit unlimited option repricing authority or that
have repriced in the past without shareholder approval.
o Be a self-replenishing "evergreen" plan, plans that grant
discount options and tax offset payments.
o We are generally in favor of proposals that increase participation beyond
executives.
o We generally support proposals asking companies to adopt rigorous
vesting provisions for stock option plans such as those that vest
incrementally over, at least, a three- or four-year period with a pro
rata portion of the shares becoming exercisable on an annual basis
following grant date.
o We generally support proposals asking companies to disclose their
window period policies for stock transactions. Window period policies
ensure that employees do not exercise options based on insider
information contemporaneous with quarterly earnings releases and other
material corporate announcements.
o We generally support proposals asking companies to adopt stock holding
periods for their executives.
o All other employee stock purchase plans.
o All other compensation-related proposals, including deferred
compensation plans, employment agreements, loan guarantee programs
and retirement plans.
o All other proposals regarding stock compensation plans, including
extending the life of a plan, changing vesting restrictions,
repricing options, lengthening exercise periods or accelerating
distribution of awards and pyramiding and cashless exercise
programs.
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We will vote against:
o Pensions for non-employee directors. We believe these retirement
plans reduce director objectivity.
o Elimination of stock option plans.
We will vote on a case-by case basis on these issues:
o Limits on executive and director pay.
o Stock in lieu of cash compensation for directors.
Corporate Governance
Pioneer will vote for:
o Confidential Voting.
o Equal access provisions, which allow shareholders to contribute
their opinion to proxy materials.
o Proposals requiring directors to disclose their ownership of shares
in the company.
We will vote on a case-by-case basis on the following issues:
o Change in the state of incorporation. We will support
reincorporations supported by valid business reasons. We will
oppose those that appear to be solely for the purpose of
strengthening takeover defenses.
o Bundled proposals. We will evaluate the overall impact of the
proposal.
o Adopting or amending the charter, bylaws or articles of association.
o Shareholder appraisal rights, which allow shareholders to demand
judicial review of an acquisition price.
We will vote against:
o Shareholder advisory committees. While management should solicit
shareholder input, we prefer to leave the method of doing so to
management's discretion.
o Limitations on stock ownership or voting rights.
o Reduction in share ownership disclosure guidelines.
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Mergers and Restructurings
Pioneer will vote on the following and similar issues on a case-by-case
basis:
o Mergers and acquisitions.
o Corporate restructurings, including spin-offs, liquidations, asset
sales, joint ventures, conversions to holding company and
conversions to self-managed REIT structure.
o Debt restructurings.
o Conversion of securities.
o Issuance of shares to facilitate a merger.
o Private placements, warrants, convertible debentures.
o Proposals requiring management to inform shareholders of merger
opportunities.
We will normally vote against shareholder proposals requiring that the
company be put up for sale.
Mutual Funds
Many of our portfolios may invest in shares of closed-end mutual funds or
exchange-traded funds. The non-corporate structure of these investments
raises several unique proxy voting issues.
Pioneer will vote for:
o Establishment of new classes or series of shares.
o Establishment of a master-feeder structure.
Pioneer will vote on a case-by-case on:
o Changes in investment policy. We will normally support changes
that do not affect the investment objective or overall risk level
of the fund. We will examine more fundamental changes on a
case-by-case basis.
o Approval of new or amended advisory contracts.
o Changes from closed-end to open-end format.
o Authorization for, or increase in, preferred shares.
o Disposition of assets, termination, liquidation, or mergers.
o Classified boards of closed-end mutual funds, but will typically
support such proposals.
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Social Issues
Pioneer will abstain on stockholder proposals calling for greater
disclosure of corporate activities with regard to social issues. "Social
Issues" may generally be described as shareholder proposals for a company
to:
o Conduct studies regarding certain issues of public concern and
interest;
o Study the feasibility of the company taking certain actions with
regard to such issues; or
o Take specific action, including ceasing certain behavior and
adopting company standards and principles, in relation to issues
of public concern and interest.
We believe these issues are important and should receive management
attention.
Pioneer will vote against proposals calling for substantial changes in the
company's business or activities. We will also normally vote against
proposals with regard to contributions, believing that management should
control the routine disbursement of funds.
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Item 8. Portfolio Managers of Closed-End Management Investment
Companies.
(a) If the registrant is a closed-end management investment company that
is filing an annual report on this Form N-CSR,provide the following
information:
(1) State the name, title, and length of service of the person or persons
employed by or associated with the registrant or an investment adviser
of the registrant who are primarily responsible for the day-to-day management
of the registrants portfolio (Portfolio Manager). Also state each Portfolio
Managers business experience during the past 5 years.
PORTFOLIO MANAGEMENT
Additional Information About the Portfolio Managers
Other Accounts Managed by the Portfolio Managers. The table below indicates, for
each portfolio manager of the fund, information about the accounts other than
the fund over which the portfolio manager has day-to-day investment
responsibility. All information on the number of accounts and total assets in
the table is as of March 31, 2007. For purposes of the table, "Other Pooled
Investment Vehicles" may include investment partnerships, undertakings for
collective investments in transferable securities ("UCITS") and other non-U.S.
investment funds and group trusts, and "Other Accounts" may include separate
accounts for institutions or individuals, insurance company general or separate
accounts, pension funds and other similar institutional accounts but generally
do not include the portfolio manager's personal investment accounts or those
which the manager may be deemed to own beneficially under the code of ethics.
Certain funds and other accounts managed by the portfolio manager may have
substantially similar investment strategies.
--------------------- -------------------- ----------------- ------------------- ------------------ -------------------
Name of Portfolio Type of Account Number of Total Assets Number of Assets Managed
Manager Accounts Managed Managed Accounts Managed for which
for which Advisory Fee is
Advisory Fee is Performance-Based
Performance-Based
--------------------- -------------------- ----------------- ------------------- ------------------ -------------------
--------------------- -------------------- ----------------- ------------------- ------------------ -------------------
Andrew Feltus Other Registered 6 $7,327,584,000 N/A N/A
Investment
Companies
-------------------- ----------------- ------------------- ------------------ -------------------
-------------------- ----------------- ------------------- ------------------ -------------------
Other Pooled 5 $741,806,000 N/A N/A
Investment Vehicles
-------------------- ----------------- ------------------- ------------------ -------------------
-------------------- ----------------- ------------------- ------------------ -------------------
Other Accounts 2 $291,009,000 N/A N/A
--------------------- -------------------- ----------------- ------------------- ------------------ -------------------
Potential Conflicts of Interest. When a portfolio manager is responsible for the
management of more than one account, the potential arises for the portfolio
manager to favor one account over another. The principal types of potential
conflicts of interest that may arise are discussed below. For the reasons
outlined below, Pioneer does not believe that any material conflicts are likely
to arise out of a portfolio manager's responsibility for the management of the
fund as well as one or more other accounts. Although Pioneer has adopted
procedures that it believes are reasonably designed to detect and prevent
violations of the federal securities laws and to mitigate the potential for
conflicts of interest to affect its portfolio management decisions, there can be
no assurance that all conflicts will be identified or that all procedures will
be effective in mitigating the potential for such risks. Generally, the risks of
such conflicts of interests are increased to the extent that a portfolio manager
has a financial incentive to favor one account over another. Pioneer has
structured its compensation arrangements in a manner that is intended to limit
such potential for conflicts of interests. See "Compensation of Portfolio
Managers" below.
o A portfolio manager could favor one account over another in allocating
new investment opportunities that have limited supply, such as initial
public offerings and private placements. If, for example, an initial
public offering that was expected to appreciate in value significantly
shortly after the offering was allocated to a single account, that
account may be expected to have better investment performance than
other accounts that did not receive an allocation of the initial
public offering. Generally, investments for which there is limited
availability are allocated based upon a range of factors including
available cash and consistency with the accounts' investment objectives
and policies. This allocation methodology necessarily involves some
subjective elements but is intended over time to treat each client in
an equitable and fair manner. Generally, the investment opportunity is
allocated among participating accounts on a pro rata basis. Although
Pioneer believes that its practices are reasonably designed to treat
each client in an equitable and fair manner, there may be instances
where a fund may not participate, or may participate to a lesser degree
than other clients, in the allocation of an investment opportunity.
o A portfolio manager could favor one account over another in the order in
which trades for the accounts are placed. If a portfolio manager
determines to purchase a security for more than one account in an
aggregate amount that may influence the market price of the security,
accounts that purchased or sold the security first may receive a more
favorable price than accounts that made subsequent transactions. The
less liquid the market for the security or the greater the percentage
that the proposed aggregate purchases or sales represent of average
daily trading volume, the greater the potential for accounts that make
subsequent purchases or sales to receive a less favorable price. When a
portfolio manager intends to trade the same security on the same day for
more than one account, the trades typically are "bunched," which means
that the trades for the individual accounts are aggregated and each
account receives the same price. There are some types of accounts as
to which bunching may not be possible for contractual reasons (such as
directed brokerage arrangements). Circumstances may also arise where the
trader believes that bunching the orders may not result in the best
possible price. Where those accounts or circumstances are involved,
Pioneer will place the order in a manner intended to result in as
favorable a price as possible for such client.
o A portfolio manager could favor an account if the portfolio manager's
compensation is tied to the performance of that account to a greater
degree than other accounts managed by the portfolio manager. If, for
example, the portfolio manager receives a bonus based upon the
performance of certain accounts relative to a benchmark while other
accounts are disregarded for this purpose, the portfolio manager will
have a financial incentive to seek to have the accounts that determine
the portfolio manager's bonus achieve the best possible performance to
the possible detriment of other accounts. Similarly, if Pioneer receives
a performance-based advisory fee, the portfolio manager may favor that
account, whether or not the performance of that account directly
determines the portfolio manager's compensation.
o A portfolio manager could favor an account if the portfolio manager has
a beneficial interest in the account, in order to benefit a large client
or to compensate a client that had poor returns. For example, if the
portfolio manager held an interest in an investment partnership that was
one of the accounts managed by the portfolio manager, the portfolio
manager would have an economic incentive to favor the account in which
the portfolio manager held an interest.
o If the different accounts have materially and potentially conflicting
investment objectives or strategies, a conflict of interest could arise.
For example, if a portfolio manager purchases a security for one account
and sells the same security for another account, such trading pattern
may disadvantage either the account that is long or short. In making
portfolio manager assignments, Pioneer seeks to avoid such potentially
conflicting situations. However, where a portfolio manager is
responsible for accounts with differing investment objectives and
policies, it is possible that the portfolio manager will conclude that
it is in the best interest of one account to sell a portfolio security
while another account continues to hold or increase the holding in such
security.
Compensation of Portfolio Managers. Pioneer has adopted a system of compensation
for portfolio managers and seeks to align the financial interests of the
portfolio managers with both those of shareholders of the accounts the portfolio
managers manage, through incentive payments based in part on the relative
investment performance of those funds, and also Pioneer through incentive
payments based in part on Pioneer's financial performance. Pioneer's
compensation arrangements with its portfolio managers are determined on the
basis of the portfolio manager's overall services to Pioneer and its affiliates
and not on the basis of specific funds or accounts managed by the portfolio
manager. The compensation program for all Pioneer portfolio managers includes a
base salary (determined by the rank and tenure of the employee) and an annual
bonus program, as well as customary benefits that are offered generally to all
full-time employees. Base compensation is fixed and normally reevaluated on an
annual basis. Pioneer seeks to set base compensation at market rates, taking
into account the experience and responsibilities of the portfolio manager. The
bonus plan is intended to provide a competitive level of annual bonus
compensation that is tied to the portfolio manager achieving superior investment
performance and aligns the financial incentives of Pioneer and the investment
professional. Any bonus under the plan is completely discretionary, with a
maximum annual bonus that may be in excess of base salary. The annual bonus is
based upon a combination of the following factors:
o Quantitative Investment Performance. The quantitative investment
performance calculation is based on pre-tax performance of all of the
accounts managed by the portfolio manager (which includes the fund and
any other accounts managed by the portfolio manager) over a one-year
period (20% weighting) and four-year period (80% weighting), measured
for periods ending on December 31. The accounts, which include the
fund, are ranked against a group of mutual funds with similar
investment objectives and investment focus (60%) and a broad-based
securities market index measuring the performance of the same type
of securities in which the accounts invest (40%), which, in the case
of the fund, is the Merrill Lynch High Yield Master II Index. As a
result of this benchmark, the performance of the portfolio manager for
compensation purposes is measured against the criteria that are
relevant to the portfolio manager's competitive universe.
o Qualitative Performance. The qualitative performance component with
respect to all of the accounts managed by the portfolio manager
includes objectives, such as effectiveness in the areas of teamwork,
leadership, communications and marketing, that are mutually established
and evaluated by each portfolio manager and management.
o Pioneer Results and Business Line Results. Pioneer's financial
performance, as well as the investment performance of its investment
management group, affect a portfolio manager's actual bonus by a
leverage factor of plus or minus (+/-) a predetermined percentage.
Certain portfolio managers participate in an incentive plan whereby senior
executives or other key employees are granted options in stock of Pioneer Global
Asset Management S.p.A., an affiliate of Pioneer, at the then fair value of the
underlying stock. These options are generally exercisable within three years.
Share Ownership by Portfolio Managers. The following table indicates as of March
31, 2007 the value, within the indicated range, of shares beneficially owned by
the portfolio managers of the fund.
--------------------------------------- ----------------------------------------
Name of Portfolio Manager Beneficial Ownership of the Fund*
--------------------------------------- ----------------------------------------
--------------------------------------- ----------------------------------------
Andrew Feltus C
--------------------------------------- ----------------------------------------
*Key to Dollar Ranges
A. None
B. $1 - $10,000
C. $10,001 - $50,000
D. $50,001 - $100,000
E. $100,001 - $500,000
F. $500,001 - $1,000,000
G. Over $1,000,000
Item 9. Purchases of Equity Securities by Closed-End Management
Investment Company and Affiliated Purchasers.
(a) If the registrant is a closed-end management investment company,
in the following tabular format, provide the information specified in
paragraph (b) of this Item with respect to any purchase made by or on
behalf of the registrant or any affiliated purchaser, as defined in
Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of
shares or other units of any class of the registrants equity securities
that is registered by the registrant pursuant to Section 12 of the
Exchange Act (15 U.S.C. 781). Instruction to paragraph (a). Disclose
all purchases covered by this Item, including purchases that do not
satisfy the conditions of the safe harbor of Rule 10b-18 under the
Exchange Act (17 CFR 240.10b-18), made in the period covered by the
report. Provide disclosures covering repurchases made on a monthly basis.
For example, if the reporting period began on January 16 and ended on
July 15, the chart would show repurchases for the months from January 16
through February 15, February 16 through March 15, March 16 through
April 15, April 16 through May 15, May 16 through June 15, and June 16
through July 15.
During the period covered by this report, there were no purchases
made by or on behalf of the registrant or any affiliated purchaser
as defined in Rule 10b-18(a)(3) under the Securities Exchange Act
of 1934 (the Exchange Act), of shares of the registrants equity
securities that are registered by the registrant pursuant to
Section 12 of the Exchange Act.
Item 10. Submission of Matters to a Vote of Security Holders.
Describe any material changes to the procedures by which shareholders
may recommend nominees to the registrants board of directors, where
those changes were implemented after the registrant last provided
disclosure in response to the requirements of Item 7(d)(2)(ii)(G)
of Schedule 14A (17 CFR 240.14a-101), or this Item.
There have been no material changes to the procedures by which the
shareholders may recommend nominees to the registrants board of
directors since the registrant last provided disclosure in response
to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14(A) in
its definitive proxy statement, or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer
and principal financial officer have
concluded that the registrant's disclosure
controls and procedures are effective based
on their evaluation of these controls and
procedures as of a date within 90 days of the
filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the
registrant's internal control over financial
reporting that occurred during the second
fiscal quarter of the period covered by this
report that have materially affected, or are
reasonably likely to materially affect, the
registrant's internal control over financial
reporting.
The registrant's principal executive officer and principal financial
officer, however, voluntarily are reporting the following information:
In August of 2006 the registrant's investment adviser
enhanced its internal procedures for reporting performance
information required to be included in prospectuses.
Those enhancements involved additional internal controls
over the appropriateness of performance data
generated for this purpose. Such enhancements were made
following an internal review which identified
prospectuses relating to certain classes of shares of
a limited number of registrants where, inadvertently,
performance information not reflecting the deduction of
applicable sales charges was included. Those prospectuses
were revised, and the revised prospectuses were distributed to
shareholders.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer High Income Trust
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date May 30, 2007
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date May 30, 2007
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date May 30, 2007
* Print the name and title of each signing officer under his or her signature.