| Ticker Symbol: MHI |
| Q | How did the Fund perform during the 12-month period ended April 30, 2024? |
| A | Pioneer Municipal High Income Fund, Inc. returned -0.02% at net asset value (NAV) and 0.95% at market price during the 12-month period ended April 30, 2024. During the same 12-month period, the Fund’s benchmarks, the Bloomberg US Municipal High Yield Bond Index and the Bloomberg Municipal Bond Index, returned 6.63% and 2.08% at NAV, respectively. The Bloomberg US Municipal High Yield Bond Index is an unmanaged measure of the performance of lower rated municipal bonds, while the Bloomberg Municipal Bond Index is an unmanaged measure of the performance of investment-grade municipal bonds. Unlike the Fund, the two indices do not use leverage. While the use of leverage increases investment opportunity, it also increases investment risk. |
| During the same 12-month period, the average return at NAV of the 24 closed end funds in Morningstar’s Closed End High Yield Municipal category (which may or may not be leveraged) was -0.62%, and the average return at market price of the closed-end funds within the same Morningstar category was 0.96%. | |
| The shares of the Fund were selling at a 12.83% discount to NAV on April 30, 2024. Comparatively, the shares of the Fund were selling at a 13.67% discount to NAV on April 30, 2023. On |
| * | Mr. van Roden and Mr. Vadlamani became portfolio managers of the Fund effective February 28, 2024. |
| April 30, 2024, the standardized 30-day SEC yield of the Fund’s shares was 2.93%**. | |
| Q | Which of your investment strategies or individual portfolio holdings contributed positively to performance during the 12-month period ended April 30, 2024? |
| A | In sector terms, the portfolio’s positioning in the education, Tobacco Master Settlement Agreement (MSA) and housing sectors contributed positively to the Fund’s relative returns during the 12-month period. |
| Individual holdings of Puerto Rico municipal securities, specifically general obligation debt contributed positively to the Fund’s benchmark-relative returns as strong investor demand drove spreads tighter. Additionally, the water and sewer sectors also, contributed positively to the Fund’s benchmark-relative returns. | |
| The reduction in the Fund’s total managed assets financed by leverage in February 2024 helped relative returns, as the income component of the Fund’s total return improved. In addition, the Fund was able to divest lower yielding securities during the deleveraging process. | |
| Q | Which investment strategies or individual portfolio holdings detracted from the Fund’s benchmark-relative performance results during the 12-month period ended April 30, 2024? |
| A | Interest expense relating to the Fund’s employment of leverage detracted from the Fund’s benchmark relative returns during the first ten months of the 12-month period, due to a significant increase in short term interest rates. The interest expense on the leverage exceeded the aggregate yield of the Fund’s portfolio during that period. Subsequently, the Fund reduced the amount of its total managed assets financed by leverage, which had a positive impact on net portfolio income. |
| ** | The 30-day SEC yield is a standardized formula that is based on the hypothetical annualized earning power (investment income only) of the Fund’s portfolio securities during the period indicated. |
| On a security selection basis, overweight allocations to Tobacco MSA bonds issued in New York and Ohio detracted from the Fund’s relative performance during the 12-month period. | |
| During the 12-month period, we made the decision to divest from a rural California municipal bond. This bond was under-performing as it failed to meet bond covenant requirements, resulting in distressed pricing and adversely affecting the Fund’s benchmark-relative return. | |
| Q | Did the Fund’s distributions*** to stockholders change during the 12-month period ended April 30, 2024? |
| A | Yes, the Fund’s monthly distribution rate changed a few times during the period. There was a decrease from $0.0375 cents per share/per month to $0.0325 cents per share/per month, announced on May 15, 2023 and paid on May 31, 2023. There was a second decrease from $0.0325 cents per share/per month to $0.0275 cents per share/per month, announced on August 17, 2023 and paid on August 31, 2023. The monthly distribution rate then remained unchanged, at $0.0275 per share/per month through February 2024. There was an increase from $0.0275 cents per share/per month to $0.0350 cents per share/per month, announced on March 14, 2024 and paid on March 28, 2024. The Fund’s distributions during the reporting period included returns of capital totaling $0.01 per share. The decrease in the Fund’s distribution rate was due to an increase in the cost of leverage incurred by the Fund, which reduced the amount of funds available for distribution. |
| Q | How did the level of leverage in the Fund change during the 12-month period ended April 30, 2024? |
| A | On April 30, 2024, 18.4% of the Fund’s total managed assets were financed by leverage obtained through the issuance of Variable Rate MuniFund Term Preferred Shares, compared with 35.8% of the Fund’s total managed assets financed by leverage at the start of the period on May 1, 2023. During the 12-month period, the Fund decreased the amount of leverage by a total of $79 million, to $50 million as of April 30, 2024. The reduction in the amount of the Fund’s leverage during the period was due to increased |
| *** | Distributions are not guaranteed. |
| borrowing costs and a decrease in the value of the Fund's total assets. The interest rate on the Fund's leverage increased by 108 basis points from April 30, 2023 to April 30, 2024. | |
| Q | Did the Fund have any exposure to derivatives during the 12-month period ended April 30, 2024? |
| A | Yes, we invested the Fund’s portfolio in interest rate futures contracts during the period, which were used to manage the duration during the Fund’s deleveraging. |
| Q | What is your investment outlook, and how is the Fund positioned heading into its new fiscal year? |
| A | We have continued to prefer investments in hospital-related issues, since the sector has historically had very low default rates. The revenue received by hospitals has remained diverse, coming from a combination of Medicare, Medicaid, private insurers, and self-payors. The Fund is also overweight to Tobacco MSA bonds, due in part to the fact that the sector has experienced a below market rate of default compared to other municipal sectors. Tobacco bond revenues have provided substantial funding for the advancement of public health and other similar programs to state and local governments that signed the tobacco MSA. |
| In addition, the Fund is slightly underweight relative to the benchmark to bonds issued by the Commonwealth of Puerto Rico. The Fund is underweight select sectors within the Puerto Rico tax-exempt market based on current valuation levels and the potential for elevated volatility. Sales tax collections are up 5.2% year-over-year for the Commonwealth. The increased revenue has supported fundamentals and has been driving spreads tighter for the issuer. | |
| The Fund is also underweight to state general obligation issues, which have tended to be sensitive to political considerations, as certain state governments may have lower flexibility to raise taxes due to constituents’ preferences, thus limiting their ability to increase revenues. | |
| We anticipate that the shifting interest-rate outlook will continue to impact near-term market performance, given the data |
| dependent nature of US Federal Reserve System (Fed) policy. However, slowing consumer spending and decelerating activity in the housing market may indicate that the Fed is moving closer to the point at which it can conclude its monetary tightening cycle. If this turns out to be the case, we believe investors may turn their attention to the positive fundamental traits of the high yield municipal market, including its current low default rate and the continued decline in new-issue supply. We are also encouraged by the opportunities afforded by the compelling yields in the investment-grade municipal bond space. | |
| As is usually the case, headline news events have had a minimal effect on our day-to-day approach to managing the portfolio. Our goal is to invest the Fund in what we believe are fundamentally sound credits representing relative value opportunities, while maintaining an appropriate level of risk management. We also seek to avoid experiencing defaults in the Fund through our emphasis on fundamental research. We believe this steady, long term approach remains the most effective way to identify opportunities and to help minimize the risk associated with investing in the high-yield municipal market. |
| (As a percentage of total investments)* | ||
| 1. | Buckeye Tobacco Settlement Financing Authority, Senior Class 2, Series B-2, 5.00%, 6/1/55 | 4.56% |
| 2. | New York Transportation Development Corp., Delta Airlines Inc-LaGuardia, 5.00%, 10/1/40 | 4.44 |
| 3. | Puerto Rico Commonwealth Aqueduct ∓ Sewer Authority, Series A, 5.00%, 7/1/47 (144A) | 3.80 |
| 4. | Arkansas Development Finance Authority, Green Bond, 5.45%, 9/1/52 | 3.77 |
| 5. | Brookhaven Development Authority, Children's Healthcare Of Atlanta, Inc., Series A, 4.00%, 7/1/44 | 3.63 |
| 6. | Iowa Finance Authority, Alcoa Inc. Projects, 4.75%, 8/1/42 | 3.48 |
| 7. | Massachusetts Development Finance Agency, WGBH Educational Foundation, Series A, 5.75%, 1/1/42 (AMBAC Insured) | 3.32 |
| 8. | Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, Series A1, 5.00%, 7/1/58 | 3.07 |
| 9. | City of Houston Airport System Revenue, 4.00%, 7/15/41 | 2.79 |
| 10. | Metropolitan Transportation Authority, Green Bond, Series C-1, 4.75%, 11/15/45 | 2.35 |
| 4/30/24 | 4/30/23 | |
| Market Value | $ |
$ |
| Discount | ( |
( |
| 4/30/24 | 4/30/23 | |
| Net Asset Value | $ |
$ |
| Net Investment Income |
Short-Term Capital Gains |
Long-Term Capital Gains |
Tax Return of Capital | |
| 5/1/23 – 4/30/24 | $0.3461 | $— | $— | $0.0124 |
| 4/30/24 | 4/30/23 | |
| 30-Day SEC Yield | 2.93% | 4.50% |
| Principal Amount USD ($) |
Value | |||||
| UNAFFILIATED ISSUERS — 120.2% | ||||||
| Municipal Bonds — 119.8% of Net Assets(a) | ||||||
| Arizona — 0.9% | ||||||
| 2,220,000 | Industrial Development Authority of the City of Phoenix, 3rd ∓ Indian School Assisted Living Project, 5.40%, 10/1/36 | $ 1,972,470 | ||||
| Total Arizona | $1,972,470 | |||||
| Arkansas — 4.5% | ||||||
| 10,200,000 | Arkansas Development Finance Authority, Green Bond, 5.45%, 9/1/52 | $ 10,050,162 | ||||
| Total Arkansas | $10,050,162 | |||||
| California — 5.9% | ||||||
| 2,500,000 | Bay Area Toll Authority, Series F-2, 2.60%, 4/1/56 | $ 1,571,225 | ||||
| 530,000 | California County Tobacco Securitization Agency, Series B-1, 5.00%, 6/1/49 | 538,671 | ||||
| 10,000,000(b) | California County Tobacco Securitization Agency, Capital Appreciation, Stanislaus County, Subordinated, Series A, 6/1/46 | 2,621,500 | ||||
| 750,000 | California Municipal Finance Authority, Westside Neighborhood School Project, Series A, 6.375%, 6/15/64 (144A) | 768,487 | ||||
| 1,400,000 | California Statewide Communities Development Authority, Lancer Plaza Project, 5.625%, 11/1/33 | 1,401,176 | ||||
| 2,000,000 | California Statewide Communities Development Authority, Loma Linda University Medical Center, 5.50%, 12/1/58 (144A) | 2,037,800 | ||||
| 4,000,000 | San Diego County Regional Airport Authority, Series B, 5.25%, 7/1/58 | 4,195,440 | ||||
| Total California | $13,134,299 | |||||
| Colorado — 2.5% | ||||||
| 1,000,000 | Aerotropolis Regional Transportation Authority, 4.375%, 12/1/52 | $ 818,630 | ||||
| 2,450,000 | Dominion Water ∓ Sanitation District, 5.875%, 12/1/52 | 2,404,038 | ||||
| 2,500,000 | Nine Mile Metropolitan District, 5.125%, 12/1/40 | 2,419,625 | ||||
| Total Colorado | $5,642,293 | |||||
| Connecticut — 1.5% | ||||||
| 3,280,000 | Mohegan Tribal Finance Authority, 7.00%, 2/1/45 (144A) | $ 3,286,101 | ||||
| Total Connecticut | $3,286,101 | |||||
| Principal Amount USD ($) |
Value | |||||
| District of Columbia — 3.8% | ||||||
| 5,825,000 | District of Columbia Tobacco Settlement Financing Corp., Asset-Backed, 6.75%, 5/15/40 | $ 6,018,739 | ||||
| 10,000,000(b) | District of Columbia Tobacco Settlement Financing Corp., Capital Appreciation, Asset-Backed, Series A, 6/15/46 | 2,355,400 | ||||
| Total District of Columbia | $8,374,139 | |||||
| Florida — 4.9% | ||||||
| 3,220,000 | City of Tampa, Hospital Revenue Bonds (H. Lee Moffit Cancer Center Project), Series B, 4.00%, 7/1/45 | $ 2,944,787 | ||||
| 5,000,000 | County of Miami-Dade, Water ∓ Sewer System Revenue, Series A, 4.00%, 10/1/44 | 4,764,000 | ||||
| 2,000,000 | Florida Development Finance Corp., Brightline Florida Passenger Rail Project, 5.50%, 7/1/53 | 2,079,980 | ||||
| 1,000,000(c) | Florida Development Finance Corp., Brightline Florida Passenger Rail Project, 12.00%, 7/15/32 (144A) | 1,028,490 | ||||
| Total Florida | $10,817,257 | |||||
| Georgia — 4.4% | ||||||
| 10,000,000 | Brookhaven Development Authority, Children's Healthcare Of Atlanta, Inc., Series A, 4.00%, 7/1/44 | $ 9,689,300 | ||||
| Total Georgia | $9,689,300 | |||||
| Idaho — 2.3% | ||||||
| 5,000,000 | Power County Industrial Development Corp., FMC Corp. Project, 6.45%, 8/1/32 | $ 5,014,050 | ||||
| Total Idaho | $5,014,050 | |||||
| Illinois — 6.6% | ||||||
| 2,000,000(d) | Chicago Board of Education, Series A, 5.00%, 12/1/47 | $ 2,007,560 | ||||
| 2,000,000(d) | Chicago Board of Education, Series H, 5.00%, 12/1/46 | 1,960,400 | ||||
| 704,519(b)(e) | Illinois Finance Authority, Cabs Clare Oaks Project, Series B-1, 11/15/52 | 42,271 | ||||
| 1,116,010(c)(e) | Illinois Finance Authority, Clare Oaks Project, Series A-3, 4.00%, 11/15/52 | 725,406 | ||||
| 3,500,000 | Illinois Finance Authority, The Admiral at the Lake Project, 5.25%, 5/15/42 | 2,729,265 | ||||
| 4,000,000 | Illinois Finance Authority, The Admiral at the Lake Project, 5.50%, 5/15/54 | 2,892,400 | ||||
| 915,000 | Illinois Housing Development Authority, Series B, 2.15%, 10/1/41 (GNMA FNMA FHLMC COLL Insured) | 627,965 | ||||
| 2,000,000 | Metropolitan Pier ∓ Exposition Authority, McCormick Place Expansion, 4.00%, 6/15/50 | 1,796,300 | ||||
| Principal Amount USD ($) |
Value | |||||
| Illinois — (continued) | ||||||
| 1,205,000 | Metropolitan Pier ∓ Exposition Authority, McCormick Place Expansion, 5.00%, 6/15/57 | $ 1,212,929 | ||||
| 695,000(e) | Southwestern Illinois Development Authority, Village of Sauget Project, 5.625%, 11/1/26 | 521,250 | ||||
| Total Illinois | $14,515,746 | |||||
| Indiana — 1.8% | ||||||
| 2,000,000 | City of Evansville, Silver Birch Evansville Project, 5.45%, 1/1/38 | $ 1,760,220 | ||||
| 1,500,000 | City of Mishawaka, Silver Birch Mishawaka Project, 5.375%, 1/1/38 (144A) | 1,272,915 | ||||
| 1,000,000 | Indiana Finance Authority, Multipurpose Educational Facilities, Avondale Meadows Academy Project, 5.375%, 7/1/47 | 949,100 | ||||
| Total Indiana | $3,982,235 | |||||
| Iowa — 4.2% | ||||||
| 9,675,000 | Iowa Finance Authority, Alcoa Inc. Projects, 4.75%, 8/1/42 | $ 9,285,871 | ||||
| Total Iowa | $9,285,871 | |||||
| Maine — 1.2% | ||||||
| 3,000,000 | Maine Health ∓ Higher Educational Facilities Authority, Series A, 4.00%, 7/1/50 | $ 2,734,140 | ||||
| Total Maine | $2,734,140 | |||||
| Maryland — 1.0% | ||||||
| 3,000,000 | Maryland State Transportation Authority, Series A, 3.00%, 7/1/47 | $ 2,260,500 | ||||
| Total Maryland | $2,260,500 | |||||
| Massachusetts — 7.3% | ||||||
| 2,500,000 | Massachusetts Development Finance Agency, Series A, 5.00%, 7/1/44 | $ 2,379,325 | ||||
| 3,000,000 | Massachusetts Development Finance Agency, Lowell General Hospital, Series G, 5.00%, 7/1/44 | 2,914,260 | ||||
| 7,100,000 | Massachusetts Development Finance Agency, WGBH Educational Foundation, Series A, 5.75%, 1/1/42 (AMBAC Insured) | 8,837,015 | ||||
| 2,270,000(d) | Town of Millbury, 4.00%, 8/15/51 | 2,051,830 | ||||
| Total Massachusetts | $16,182,430 | |||||
| Michigan — 0.4% | ||||||
| 990,000 | David Ellis Academy-West, 5.25%, 6/1/45 | $ 897,653 | ||||
| Total Michigan | $897,653 | |||||
| Principal Amount USD ($) |
Value | |||||
| Minnesota — 0.4% | ||||||
| 1,000,000 | City of Ham Lake, DaVinci Academy, Series A, 5.00%, 7/1/47 | $ 912,590 | ||||
| Total Minnesota | $912,590 | |||||
| Montana — 0.0%† | ||||||
| 1,600,000(e) | Two Rivers Authority, 7.375%, 11/1/27 | $ 64,000 | ||||
| Total Montana | $64,000 | |||||
| New Hampshire — 2.9% | ||||||
| 6,000,000 | New Hampshire Health and Education Facilities Authority Act, Series A, 5.00%, 8/1/59 (BAM-TCRS Insured) | $ 6,222,780 | ||||
| 375,000 | New Hampshire Health and Education Facilities Authority Act, Catholic Medical Centre, 3.75%, 7/1/40 | 281,993 | ||||
| Total New Hampshire | $6,504,773 | |||||
| New Jersey — 1.4% | ||||||
| 2,200,000 | New Jersey Economic Development Authority, Continental Airlines, 5.75%, 9/15/27 | $ 2,204,004 | ||||
| 1,000,000 | New Jersey Economic Development Authority, Marion P. Thomas Charter School, Inc., Project, Series A, 5.375%, 10/1/50 (144A) | 899,690 | ||||
| Total New Jersey | $3,103,694 | |||||
| New Mexico — 1.1% | ||||||
| 2,540,000(c) | County of Otero, Otero County Jail Project, Certificate Participation, 9.00%, 4/1/28 | $ 2,400,300 | ||||
| Total New Mexico | $2,400,300 | |||||
| New York — 18.9% | ||||||
| 2,000,000 | Erie Tobacco Asset Securitization Corp., Asset-Backed, Series A, 5.00%, 6/1/45 | $ 1,876,440 | ||||
| 6,175,000 | Metropolitan Transportation Authority, Green Bond, Series C-1, 4.75%, 11/15/45 | 6,260,462 | ||||
| 2,000,000 | Metropolitan Transportation Authority, Green Bond, Series C-1, 5.25%, 11/15/55 | 2,068,560 | ||||
| 2,000,000 | Metropolitan Transportation Authority, Green Bond, Series D-2, 4.00%, 11/15/48 | 1,794,420 | ||||
| 3,000,000 | Metropolitan Transportation Authority, Green Bond, Series E, 4.00%, 11/15/45 | 2,781,900 | ||||
| 2,500,000 | New York Counties Tobacco Trust IV, Settlement pass through, Series A, 5.00%, 6/1/45 | 2,288,775 | ||||
| 2,000,000 | New York State Housing Finance Agency, Sustainability Bonds, Series D-1, 4.20%, 11/1/52 (SONYMA FHA 542c Insured) | 1,824,880 | ||||
| 2,500,000 | New York Transportation Development Corp., Series A, 5.25%, 1/1/50 | 2,488,675 | ||||
| Principal Amount USD ($) |
Value | |||||
| New York — (continued) | ||||||
| 11,330,000 | New York Transportation Development Corp., Delta Airlines Inc-LaGuardia, 5.00%, 10/1/40 | $ 11,828,067 | ||||
| 1,750,000 | New York Transportation Development Corp., Green Bond, 5.375%, 6/30/60 | 1,827,350 | ||||
| 340,000 | Suffolk Regional Off-Track Betting Co., 5.75%, 12/1/44 | 345,797 | ||||
| 1,000,000 | Suffolk Regional Off-Track Betting Co., 6.00%, 12/1/53 | 1,010,000 | ||||
| 2,500,000 | Triborough Bridge ∓ Tunnel Authority Sales Tax Revenue, Series A-1, 5.25%, 5/15/59 | 2,702,325 | ||||
| 2,148,177 | Westchester County Healthcare Corp., Series A, 5.00%, 11/1/44 | 2,041,885 | ||||
| 1,000,000 | Westchester County Local Development Corp., Purchase Senior Learning Community, 4.50%, 7/1/56 (144A) | 827,090 | ||||
| Total New York | $41,966,626 | |||||
| Ohio — 6.6% | ||||||
| 13,375,000 | Buckeye Tobacco Settlement Financing Authority, Senior Class 2, Series B-2, 5.00%, 6/1/55 | $ 12,162,289 | ||||
| 1,000,000 | Ohio Housing Finance Agency, Sanctuary Springboro Project, 5.45%, 1/1/38 (144A) | 819,790 | ||||
| 1,540,000 | State of Ohio, 5.00%, 12/31/39 | 1,548,039 | ||||
| Total Ohio | $14,530,118 | |||||
| Oregon — 1.6% | ||||||
| 5,000,000 | Oregon Health ∓ Science University, Green Bond, Series A, 3.00%, 7/1/51 | $ 3,573,200 | ||||
| Total Oregon | $3,573,200 | |||||
| Pennsylvania — 6.2% | ||||||
| 5,000,000 | Montgomery County Higher Education and Health Authority, Thomas Jefferson University, Series B, 4.00%, 5/1/52 | $ 4,434,500 | ||||
| 3,500,000 | Montgomery County Higher Education and Health Authority, Thomas Jefferson University, Series B, 5.00%, 5/1/57 | 3,537,940 | ||||
| 4,335,000 | Pennsylvania Higher Educational Facilities Authority, University of Pennsylvania, 4.00%, 8/15/49 | 4,103,815 | ||||
| 500,000 | Philadelphia Authority for Industrial Development, 5.50%, 6/1/49 (144A) | 455,525 | ||||
| Principal Amount USD ($) |
Value | |||||
| Pennsylvania — (continued) | ||||||
| 1,000,000 | Philadelphia Authority for Industrial Development, Global Leadership Academy Charter School Project, Series A, 5.00%, 11/15/50 | $ 822,800 | ||||
| 460,000 | Philadelphia Authority for Industrial Development, Greater Philadelphia Health Action, Inc., Project, Series A, 6.625%, 6/1/50 | 433,729 | ||||
| Total Pennsylvania | $13,788,309 | |||||
| Puerto Rico — 13.8% | ||||||
| 5,267,777(d) | Commonwealth of Puerto Rico, Restructured Series A-1, 4.00%, 7/1/41 | $ 4,901,087 | ||||
| 3,000,000(d) | Commonwealth of Puerto Rico, Restructured Series A-1, 4.00%, 7/1/46 | 2,704,920 | ||||
| 2,000,000 | GDB Debt Recovery Authority of Puerto Rico, 7.50%, 8/20/40 | 1,925,000 | ||||
| 10,000,000 | Puerto Rico Commonwealth Aqueduct ∓ Sewer Authority, Series A, 5.00%, 7/1/47 (144A) | 10,121,900 | ||||
| 1,000,000(e) | Puerto Rico Electric Power Authority, Series AAA, 5.25%, 7/1/24 | 262,500 | ||||
| 2,500,000 | Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, Series 2, 4.784%, 7/1/58 | 2,443,750 | ||||
| 8,191,000 | Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, Series A1, 5.00%, 7/1/58 | 8,172,570 | ||||
| Total Puerto Rico | $30,531,727 | |||||
| Rhode Island — 1.1% | ||||||
| 5,900,000(e) | Central Falls Detention Facility Corp., 7.25%, 7/15/35 | $ 2,360,000 | ||||
| Total Rhode Island | $2,360,000 | |||||
| Texas — 4.6% | ||||||
| 500,000 | Arlington Higher Education Finance Corp., 5.45%, 3/1/49 (144A) | $ 519,085 | ||||
| 1,000,000 | Arlington Higher Education Finance Corp., Universal Academy, Series A, 7.00%, 3/1/34 | 1,001,480 | ||||
| 8,000,000 | City of Houston Airport System Revenue, 4.00%, 7/15/41 | 7,436,160 | ||||
| 1,500,000 | New Hope Cultural Education Facilities Finance Corp., Sanctuary LTC Project, Series A-1, 5.50%, 1/1/57 | 1,231,215 | ||||
| 3,960,000(e) | Sanger Industrial Development Corp., Texas Pellets Project, Series B, 8.00%, 7/1/38 | 396 | ||||
| Total Texas | $10,188,336 | |||||
| Virginia — 7.0% | ||||||
| 2,700,000 | Tobacco Settlement Financing Corp., Series A-1, 6.706%, 6/1/46 | $ 2,300,292 | ||||
| Principal Amount USD ($) |
Value | |||||
| Virginia — (continued) | ||||||
| 2,000,000 | Virginia Small Business Financing Authority, Senior Lien, 5.00%, 12/31/42 | $ 2,052,600 | ||||
| 1,000,000 | Virginia Small Business Financing Authority, Senior Lien, 5.00%, 12/31/47 | 968,460 | ||||
| 1,000,000 | Virginia Small Business Financing Authority, Senior Lien 95 Express Lanes LLC Project, 4.00%, 1/1/48 | 870,290 | ||||
| 3,500,000 | Virginia Small Business Financing Authority, Transform 66-P3 Project, 5.00%, 12/31/49 | 3,357,060 | ||||
| 6,100,000 | Virginia Small Business Financing Authority, Transform 66-P3 Project, 5.00%, 12/31/56 | 5,944,450 | ||||
| Total Virginia | $15,493,152 | |||||
| Wisconsin — 1.0% | ||||||
| 1,500,000 | Public Finance Authority, Gardner Webb University, 5.00%, 7/1/31 (144A) | $ 1,552,770 | ||||
| 750,000 | Public Finance Authority, Roseman University Health Sciences Project, 5.875%, 4/1/45 | 756,330 | ||||
| Total Wisconsin | $2,309,100 | |||||
| Total Municipal Bonds (Cost $274,775,499) |
$265,564,571 | |||||
| U.S. Government and Agency Obligations — 0.4% of Net Assets |
||||||
| 1,000,000(b) | U.S. Treasury Bills, 5/21/24 | $ 997,072 | ||||
| Total U.S. Government and Agency Obligations (Cost $997,065) |
$997,072 | |||||
| TOTAL INVESTMENTS IN UNAFFILIATED ISSUERS — 120.2% (Cost $275,772,564) |
$266,561,643 | |||||
| OTHER ASSETS AND LIABILITIES — (20.2)% | $(44,805,665) | |||||
| net assets applicable to common stockholders — 100.0% | $221,755,978 | |||||
| AMBAC | Ambac Assurance Corporation. |
| BAM | Build America Mutual Assurance Company. |
| COLL | Collateral. |
| FHA 542c | Federal Housing Administration Section 542c. |
| FHLMC | Federal Home Loan Mortgage Corporation. |
| FNMA | Federal National Mortgage Association. |
| GNMA | Government National Mortgage Association. |
| SONYMA | State of New York Mortgage Agency. |
| TCRS | Transferable Custodial Receipts. |
| (144A) | The resale of such security is exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be resold normally to qualified institutional buyers. At April 30, 2024, the value of these securities amounted to $23,589,643, or 10.6% of net assets applicable to common stockholders. |
| (a) | Consists of Revenue Bonds unless otherwise indicated. |
| (b) | Security issued with a zero coupon. Income is recognized through accretion of discount. |
| (c) | The interest rate is subject to change periodically. The interest rate and/or reference index and spread shown at April 30, 2024. |
| (d) | Represents a General Obligation Bond. |
| (e) | Security is in default. |
| † | Amount rounds to less than 0.1%. |
| Revenue Bonds: | |
| Development Revenue | 24.7% |
| Health Revenue | 23.1 |
| Transportation Revenue | 17.5 |
| Tobacco Revenue | 11.3 |
| Water Revenue | 6.5 |
| Other Revenue | 5.8 |
| Education Revenue | 4.1 |
| Facilities Revenue | 1.8 |
| Power Revenue | 0.1 |
| 94.9% | |
| General Obligation Bonds: | 5.1% |
| 100.0% |
FIXED INCOME INDEX FUTURES CONTRACTS
| Number of Contracts Long |
Description | Expiration Date |
Notional Amount |
Market Value |
Unrealized (Depreciation) |
| 87 | U.S. Long Bond (CBT) | 6/18/24 | $10,354,590 | $9,901,688 | $(452,902) |
| TOTAL FUTURES CONTRACTS | $10,354,590 | $9,901,688 | $(452,902) | ||
| CBT | Chicago Board of Trade. | ||||
| Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost | $10,913,782 |
| Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value | (19,276,008) |
| Net unrealized depreciation | $(8,362,226) |
| Level 1 | – | unadjusted quoted prices in active markets for identical securities. |
| Level 2 | – | other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.). See Notes to Financial Statements — Note 1A. |
| Level 3 | – | significant unobservable inputs (including the Adviser’s own assumptions in determining fair value of investments). See Notes to Financial Statements — Note 1A. |
| Level 1 | Level 2 | Level 3 | Total | |
| Municipal Bonds | $— | $265,564,571 | $— | $265,564,571 |
| U.S. Government and Agency Obligations | — | 997,072 | — | 997,072 |
| Total Investments in Securities | $— | $266,561,643 | $— | $266,561,643 |
| Other Financial Instruments | ||||
| Variable Rate MuniFund Term Preferred Shares(a) | $— | $(50,000,000) | $— | $(50,000,000) |
| Net unrealized depreciation on futures contracts | (452,902) | — | — | (452,902) |
| Total Other Financial Instruments | $(452,902) | $(50,000,000) | $— | $(50,452,902) |
| (a) | The Fund may hold liabilities in which the fair value approximates the carrying amount for financial statement purposes. |
| ASSETS: | |
| Investments in unaffiliated issuers, at value (cost $275,772,564) | $266,561,643 |
| Cash | 3,707,961 |
| Futures collateral | 398,906 |
| Due from broker for futures | 67,969 |
| Distribution paid in advance | 796,997 |
| Receivables — | |
| Investment securities sold | 926,232 |
| Interest | 4,140,389 |
| Other assets | 104 |
| Total assets | $276,600,201 |
| LIABILITIES: | |
| Variable Rate MuniFund Term Preferred Shares* | $50,000,000 |
| Payables — | |
| Investment securities purchased | 3,775,940 |
| Distributions | 796,997 |
| Directors’ fees | 889 |
| Variation margin for futures contracts | 67,969 |
| Management fees | 22,264 |
| Administrative expenses | 24,055 |
| Accrued expenses | 156,109 |
| Total liabilities | $54,844,223 |
| NET ASSETS APPLICABLE TO COMMON STOCKHOLDERS: | |
| Paid-in capital | $299,230,912 |
| Distributable earnings (loss) | (77,474,934) |
| Net assets | $221,755,978 |
| NET ASSET VALUE PER COMMON SHARE: | |
| No par value | |
| Based on $221,755,978/22,771,349 common shares | $9.74 |
| INVESTMENT INCOME: | ||
| Interest from unaffiliated issuers | $17,169,260 | |
| Total Investment Income | $17,169,260 | |
| EXPENSES: | ||
| Management fees | $1,984,692 | |
| Administrative expenses | 90,521 | |
| Transfer agent fees | 18,723 | |
| Stockholder communications expense | 70,698 | |
| Custodian fees | 3,226 | |
| Professional fees | 410,185 | |
| Printing expense | 14,388 | |
| Officers’ and Directors’ fees | 15,332 | |
| Insurance expense | 8,809 | |
| Interest expense | 6,323,520 | |
| Miscellaneous | 243,634 | |
| Total expenses | $9,183,728 | |
| Net investment income | $7,985,532 | |
| REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | ||
| Net realized gain (loss) on: | ||
| Reimbursement by the Adviser | $223,759 | |
| Investments in unaffiliated issuers | (24,361,627) | |
| Futures contracts | (755,613) | $(24,893,481) |
| Change in net unrealized appreciation (depreciation) on: | ||
| Investments in unaffiliated issuers | $15,720,657 | |
| Futures contracts | (452,902) | $15,267,755 |
| Net realized and unrealized gain (loss) on investments | $(9,625,726) | |
| Net decrease in net assets resulting from operations | $(1,640,194) |
| Year Ended 4/30/24 |
Year Ended 4/30/23 | |
| FROM OPERATIONS: | ||
| Net investment income (loss) | $7,985,532 | $9,182,035 |
| Net realized gain (loss) on investments | (24,893,481) | (17,025,390) |
| Change in net unrealized appreciation (depreciation) on investments | 15,267,755 | 2,971,984 |
| Net decrease in net assets resulting from operations | $(1,640,194) | $(4,871,371) |
| DISTRIBUTIONS TO COMMON STOCKHOLDERS: | ||
| ($0.35 and $0.46 per share, respectively) | $(7,880,612) | $(10,370,270) |
| Tax Return Of Capital To Common Stockholders: | ||
| ($0.01 and $0.06 per share, respectively) | $(282,917) | $(1,482,217) |
| Total distributions to common stockholders | $(8,163,529) | $(11,852,487) |
| Net decrease in net assets applicable to common stockholders | $(9,803,723) | $(16,723,858) |
| NET ASSETS APPLICABLE TO COMMON STOCKHOLDERS: | ||
| Beginning of year | $231,559,701 | $248,283,559 |
| End of year | $221,755,978 | $231,559,701 |
| Cash Flows From Operating Activities | |
| Net decrease in net assets resulting from operations | $(1,640,194) |
| Adjustments to reconcile net decrease in net assets resulting from operations to net cash and restricted cash from operating activities: | |
| Purchases of investment securities | $(106,145,288) |
| Proceeds from disposition and maturity of investment securities | 190,051,827 |
| Net purchases of short term investments | (671,427) |
| Net accretion and amortization of discount/premium on investment securities | (551,048) |
| Reimbursement by the Adviser | (223,759) |
| Net realized loss on investments in unaffiliated issuers | 24,361,627 |
| Change in unrealized appreciation on investments in unaffiliated issuers | (15,720,657) |
| Increase in due from broker for futures | (67,969) |
| Decrease in interest receivable | 1,509,777 |
| Decrease in due from affiliates | 1,719 |
| Decrease in distributions paid in advance | 56,929 |
| Decrease in other assets | 1,341 |
| Increase in variation margin for futures contracts | 67,969 |
| Decrease in management fees payable | (7,293) |
| Decrease in directors’ fees payable | (592) |
| Increase in administrative expenses payable | 5,910 |
| Increase in accrued expenses payable | 51,552 |
| Net cash and restricted cash from operating activities | $91,080,424 |
| Cash Flows Used In Financing Activities: | |
| VMTP Shares Redeemed | (79,000,000) |
| Distributions to stockholders | (8,220,458) |
| Net cash flows used in financing activities | $(87,220,458) |
| NET INCREASE (DECREASE) IN CASH AND RESTRICTED CASH | $3,859,966 |
| Cash and Restricted Cash: | |
| Beginning of year* | $246,901 |
| End of year* | $4,106,867 |
| Cash Flow Information: | |
| Cash paid for interest | $6,323,520 |
| * | The following table provides a reconciliation of cash and restricted cash reported within the Statement of Assets and Liabilities that sum to the total of the same such amounts shown in the Statement of Cash Flows: |
| Year Ended 4/30/24 |
Year Ended 4/30/23 | |
| Cash | $3,707,961 | $246,901 |
| Restricted cash | 398,906 | — |
| Total cash and restricted cash shown in the Statement of Cash Flows | $4,106,867 | $246,901 |
| Year Ended 4/30/24 |
Year Ended 4/30/23 |
Year Ended 4/30/22 |
Year Ended 4/30/21 |
Year Ended 4/30/20 | |
| Per Share Operating Performance | |||||
| Net asset value, beginning of period | $10.17 | $10.90 | $13.14 | $12.31 | $12.65 |
| Increase (decrease) from investment operations:(a) | |||||
| Net investment income (loss)(b) | $0.35 | $0.40 | $0.53 | $0.55 | $0.55 |
| Net realized and unrealized gain (loss) on investments | (0.42) | (0.61) | (2.29) | 0.87 | (0.32) |
| Net increase (decrease) from investment operations | $(0.07) | $(0.21) | $(1.76) | $1.42 | $0.23 |
| Distributions to stockholders: | |||||
| Net investment income and previously undistributed net investment income | $(0.35) | $(0.46)* | $(0.48) | $(0.59)* | $(0.57)* |
| Tax return of capital | (0.01) | (0.06) | — | — | — |
| Total distributions | $(0.36) | $(0.52) | $(0.48) | $(0.59) | $(0.57) |
| Net increase (decrease) in net asset value | $(0.43) | $(0.73) | $(2.24) | $0.83 | $(0.34) |
| Net asset value, end of period | $9.74 | $10.17 | $10.90 | $13.14 | $12.31 |
| Market value, end of period | $8.49 | $8.78 | $9.57 | $12.61 | $10.82 |
| Total return at net asset value(c) | (0.02)%(d) | (1.17)% | (13.64)% | 12.04% | 2.00%(e) |
| Total return at market value(c) | 0.95% | (2.82)% | (20.99)% | 22.33% | (4.77)% |
| Ratios to average net assets of common stockholders: | |||||
| Total expenses plus interest expense(f)(g) | 4.16% | 3.15% | 1.56% | 1.62% | 2.13% |
| Net investment income | 3.61% | 3.95% | 4.15% | 4.22% | 4.24% |
| Portfolio turnover rate | 35% | 60% | 11% | 10% | 17% |
| Net assets of common stockholders, end of period (in thousands) | $221,756 | $231,560 | $248,284 | $299,280 | $280,258 |
| Preferred shares outstanding (in thousands)(h)(i)(j)(k) | $50,000 | $129,000 | $145,000 | $145,000 | $125,000 |
| Asset coverage per preferred share, end of period | $543,512 | $279,504 | $271,230 | $306,399 | $324,229 |
| Average market value per preferred share(l) | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 |
| Liquidation value, including interest expense payable, per preferred share | $100,000 | $100,000 | $100,000 | $99,999 | $100,023 |
| * | The amount of distributions made to stockholders during the year were in excess of the net investment income earned by the Fund during the year. The Fund has accumulated undistributed net investment income which is part of the Fund’s net asset value (“NAV”). A portion of the accumulated net investment income was distributed to stockholders during the year. A decrease in distributions may have a negative effect on the market value of the Fund’s shares. |
| (a) | The per common share data presented above is based upon the average common shares outstanding for the periods presented. |
| (b) | Beginning April 30, 2020, distribution payments to preferred stockholders are included as a component of net investment income. |
| (c) | Total investment return is calculated assuming a purchase of common shares at the current net asset value or market value on the first day and a sale at the current net asset value or 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 Fund’s dividend reinvestment plan. Total investment return does not reflect brokerage commissions. Past performance is not a guarantee of future results. |
| (d) | For the year ended April 30, 2024, the Fund's total return includes a reimbursement by the Adviser (see Notes to the Financial Statements-Note 1B). If the Fund had not been reimbursed by the Adviser the total return would have been (0.12)%. |
| (e) | If the Fund had not recognized gains in settlement of class action lawsuits during the year ended April 30, 2020, the total return would have been 1.73%. |
| (f) | Includes interest expense of 2.86%, 1.94%, 0.45%, 0.47%, and 1.10%, respectively. |
| (g) | Prior to April 30, 2020, the expense ratios do not reflect the effect of distribution payments to preferred stockholders. |
| (h) | The Fund redeemed 635 Variable Rate MuniFund Term Preferred Shares, with a liquidation preference of $100,000 per share, on February 29, 2024. |
| (i) | The Fund redeemed 155 Variable Rate MuniFund Term Preferred Shares, with a liquidation preference of $100,000 per share, on October 11, 2023. |
| (j) | The Fund redeemed 160 Variable Rate MuniFund Term Preferred Shares, with a liquidation preference of $100,000 per share, on November 14, 2022. |
| (k) | The Fund issued 200 Variable Rate MuniFund Term Preferred Shares, with a liquidation preference of $100,000 per share, on February 16, 2021. |
| (l) | Market value is redemption value without an active market. |
| A. | Security Valuation |
| The net asset value of the Fund is computed once daily, on each day the New York Stock Exchange (“NYSE”) is open, as of the close of regular trading on the NYSE. | |
| Fixed income securities are valued by using prices supplied by independent pricing services, which consider such factors as market prices, market events, quotations from one or more brokers, Treasury spreads, yields, maturities and ratings, or may use a pricing matrix or other fair value methods or techniques to provide an estimated value of the security or instrument. A pricing matrix is a means of valuing a debt security on the basis of current market prices for other debt securities, historical trading patterns in the market for fixed income securities and/or other factors. Non-U.S. debt securities that are listed on an exchange will be valued at the bid price obtained from an independent third party pricing service. When independent third party pricing services are unable to supply prices, or when prices or market quotations are considered to be unreliable, the value of that security may be determined using quotations from one or more broker-dealers. | |
| Futures contracts are generally valued at the closing settlement price established by the exchange on which they are traded. | |
| Securities for which independent pricing services or broker-dealers are unable to supply prices or for which market prices and/or quotations are not readily available or are considered to be unreliable are valued by a fair valuation team comprised of certain personnel of the Adviser. The Adviser is designated as the valuation designee for the Fund pursuant to Rule 2a-5 under the 1940 Act. The Adviser’s fair valuation team is responsible for monitoring developments that may impact fair valued securities. | |
| Inputs used when applying fair value methods to value a security may include credit ratings, the financial condition of the company, current market conditions and comparable securities. The Adviser may use fair value methods if it is determined that a significant event has occurred after the close of the exchange or market on which the security trades and prior to the determination of the Fund’s net asset value. Examples of a significant event might include political or economic news, corporate restructurings, natural disasters, terrorist activity or trading |
| halts. Thus, the valuation of the Fund’s securities may differ significantly from exchange prices, and such differences could be material. | |
| B. | Investment Income and Transactions |
| Interest income, including interest on income-bearing cash accounts, is recorded on the accrual basis. Dividend and interest income are reported net of unrecoverable foreign taxes withheld at the applicable country rates and net of income accrued on defaulted securities. | |
| Discounts and premiums on purchase prices of debt securities are accreted or amortized, respectively, daily, into interest income on an effective yield to maturity basis with a corresponding increase or decrease in the cost basis of the security. Premiums and discounts related to certain mortgage-backed securities are amortized or accreted in proportion to the monthly paydowns. | |
| Interest and dividend income payable by delivery of additional shares is reclassified as PIK (payment-in-kind) income upon receipt and is included in interest and dividend income, respectively. | |
| Security transactions are recorded as of trade date. Gains and losses on sales of investments are calculated on the identified cost method for both financial reporting and federal income tax purposes. | |
| During the year ended April 30, 2024, the Fund realized a loss of $223,759 due to an operational error. The Adviser voluntarily reimbursed the Fund for this loss, which is reflected on the Statement of Operations as Reimbursement by the Adviser. | |
| C. | Federal Income Taxes |
| It is the Fund’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net taxable income and net realized capital gains, if any, to its stockholders. Therefore, no provision for federal income taxes is required. As of April 30, 2024, the Fund did not accrue any interest or penalties with respect to uncertain tax positions, which, if applicable, would be recorded as an income tax expense on the Statement of Operations. Tax returns filed within the prior three years remain subject to examination by federal and state tax authorities. | |
| The amount and character of income and capital gain distributions to stockholders are determined in accordance with federal income tax rules, which may differ from U.S. GAAP. Distributions in excess of net investment income or net realized gains are temporary over distributions |
| for financial statement purposes resulting from differences in the recognition or classification of income or distributions for financial statement and tax purposes. Capital accounts within the financial statements are adjusted for permanent book/tax differences to reflect tax character, but are not adjusted for temporary differences. | |
| At April 30, 2024, the Fund was permitted to carry forward indefinitely $5,368,173 of short-term losses and $62,947,538 of long-term losses. | |
| The tax character of distributions paid during the years ended April 30, 2024 and April 30, 2023, was as follows: |
| 2024 | 2023 | |
| Distributions paid from: | ||
| Tax-exempt income | $13,790,979 | $14,653,673 |
| Ordinary income | 413,153 | 239,797 |
| Tax return of capital | 282,917 | 1,482,217 |
| Total | $14,487,049 | $16,375,687 |
| 2024 | |
| Distributable earnings/(losses): | |
| Capital loss carryforward | $(68,315,711) |
| Other book/tax temporary differences | (796,997) |
| Net unrealized depreciation | (8,362,226) |
| Total | $(77,474,934) |
| D. | Automatic Dividend Reinvestment Plan |
| All stockholders whose shares are registered in their own names 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 shares of the Fund in lieu of cash. Stockholders may elect not to participate in the Plan. Stockholders 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 Equiniti Trust Company, the agent for stockholders 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. | |
| If a stockholder’s shares are held in the name of a brokerage firm, bank or other nominee, the stockholder can ask the firm or nominee to participate in the Plan on the stockholder’s behalf. If the firm or nominee does not offer the Plan, dividends will be paid in cash to the stockholder of record. A firm or nominee may reinvest a stockholder’s cash dividends in shares of the Fund on terms that differ from the terms of the Plan. | |
| Whenever the Fund declares a dividend on shares payable in cash, participants in the Plan will receive the equivalent in shares acquired by the Plan Agent either (i) through receipt of additional unissued but authorized shares from the Fund or (ii) by purchase of outstanding shares on the New York Stock Exchange or elsewhere. If, on the payment date for any dividend, the net asset value per 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 shares. The number of newly issued shares to be credited to each account will be determined by dividing the dollar amount of the dividend by the net asset value per 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 share is greater than the market value (market discount), the Plan Agent will invest the dividend amount in shares acquired in open-market purchases. There are no brokerage charges with respect to newly issued 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 stockholders from any federal, state or local taxes which may be due on dividends paid in any taxable year. Stockholders holding Plan shares in a brokerage account may be able to transfer the shares to another broker and continue to participate in the Plan. | |
| E. | Risks |
| The value of securities held by the Fund may go up or down, sometimes rapidly or unpredictably, due to general market conditions, such as real or perceived adverse economic, political or regulatory conditions, recessions, the spread of infectious illness or other public health issues, inflation, changes in interest rates, armed conflict such as between Russia and Ukraine or in the Middle East, sanctions against Russia, |
| other nations or individuals or companies and possible countermeasures, lack of liquidity in the bond markets or adverse investor sentiment. In the past several years, financial markets have experienced increased volatility, depressed valuations, decreased liquidity and heightened uncertainty. These conditions may continue, recur, worsen or spread. Inflation and interest rates have increased and may rise further. These circumstances could adversely affect the value and liquidity of the Fund’s investments and negatively impact the Fund’s performance. | |
| The long-term impact of the COVID-19 pandemic and its subsequent variants on economies, markets, industries and individual issuers, are not known. Some sectors of the economy and individual issuers have experienced or may experience particularly large losses. Periods of extreme volatility in the financial markets, reduced liquidity of many instruments, increased government debt, inflation, and disruptions to supply chains, consumer demand and employee availability, may continue for some time. Following Russia’s invasion of Ukraine, Russian securities lost all, or nearly all, their market value. Other securities or markets could be similarly affected by past or future political, geopolitical or other events or conditions. | |
| Governments and central banks, including the U.S. Federal Reserve, have taken extraordinary and unprecedented actions to support local and global economies and the financial markets. These actions have resulted in significant expansion of public debt, including in the U.S. The consequences of high public debt, including its future impact on the economy and securities markets, may not be known for some time. | |
| The U.S. and other countries are periodically involved in disputes over trade and other matters, which may result in tariffs, investment restrictions and adverse impacts on affected companies and securities. For example, the U.S. has imposed tariffs and other trade barriers on Chinese exports, has restricted sales of certain categories of goods to China, and has established barriers to investments in China. Trade disputes may adversely affect the economies of the U.S. and its trading partners, as well as companies directly or indirectly affected and financial markets generally. If the political climate between the U.S. and China does not improve or continues to deteriorate, if China were to attempt unification of Taiwan by force, or if other geopolitical conflicts develop or get worse, economies, markets and individual securities may be severely affected both regionally and globally, and the value of the Fund’s assets may go down. |
| At times, the Fund’s investments may represent industries or industry sectors that are interrelated or have common risks, making the Fund more susceptible to any economic, political, or regulatory developments or other risks affecting those industries and sectors. | |
| Under normal circumstances, the Fund will invest substantially all of its assets in municipal securities. The municipal bond market can be susceptible to unusual volatility, particularly for lower-rated and unrated securities. Liquidity can be reduced unpredictably in response to overall economic conditions or credit tightening. Municipal issuers may be adversely affected by rising health care costs, increasing unfunded pension liabilities, and by the phasing out of federal programs providing financial support. Unfavorable conditions and developments relating to projects financed with municipal securities can result in lower revenues to issuers of municipal securities, potentially resulting in defaults. Issuers often depend on revenues from these projects to make principal and interest payments. The value of municipal securities can also be adversely affected by changes in the financial condition of one or more individual municipal issuers or insurers of municipal issuers, regulatory and political developments, tax law changes or other legislative actions, and by uncertainties and public perceptions concerning these and other factors. Municipal securities may be more susceptible to down-grades or defaults during recessions or similar periods of economic stress. Financial difficulties of municipal issuers may continue or get worse, particularly in the event of economic or market turmoil or a recession. To the extent the Fund invests significantly in a single state (including California and Massachusetts), city, territory (including Puerto Rico), or region, or in securities the payments on which are dependent upon a single project or source of revenues, or that relate to a sector or industry, including health care facilities, education, transportation, special revenues and pollution control, the Fund will be more susceptible to associated risks and developments. | |
| The Fund invests in below investment grade (high yield) municipal securities. Debt securities rated below investment grade are commonly referred to as “junk bonds” and are considered speculative with respect to the issuer’s capacity to pay interest and repay principal. These securities involve greater risk of loss, are subject to greater price volatility, and may be less liquid and more difficult to value, especially during periods of economic uncertainty or change, than higher rated debt securities. | |
| The market prices of the Fund’s fixed income securities may fluctuate significantly when interest rates change. The value of your investment will generally go down when interest rates rise. A rise in rates tends to |
| have a greater impact on the prices of longer term or duration securities. For example, if interest rates increase by 1%, the value of a Fund’s portfolio with a portfolio duration of ten years would be expected to decrease by 10%, all other things being equal. In recent years interest rates and credit spreads in the U.S. have been at historic lows. The U.S. Federal Reserve has raised certain interest rates, and interest rates may continue to go up. A general rise in interest rates could adversely affect the price and liquidity of fixed income securities. The maturity of a security may be significantly longer than its effective duration. A security’s maturity and other features may be more relevant than its effective duration in determining the security’s sensitivity to other factors affecting the issuer or markets generally, such as changes in credit quality or in the yield premium that the market may establish for certain types of securities (sometimes called “credit spread”). In general, the longer its maturity the more a security may be susceptible to these factors. When the credit spread for a fixed income security goes up, or “widens”, the value of the security will generally go down. | |
| If an issuer or guarantor of a security held by the Fund or a counterparty to a financial contract with the Fund defaults on its obligation to pay principal and/or interest, has its credit rating downgraded or is perceived to be less creditworthy, or the credit quality or value of any underlying assets declines, the value of your investment will typically decline. Changes in actual or perceived creditworthiness may occur quickly. The Fund could be delayed or hindered in its enforcement of rights against an issuer, guarantor or counterparty. | |
| With the increased use of technologies such as the Internet to conduct business, the Fund is susceptible to operational, information security and related risks. While the Fund’s Adviser has established business continuity plans in the event of, and risk management systems to prevent, limit or mitigate, such cyber-attacks, there are inherent limitations in such plans and systems, including the possibility that certain risks have not been identified. Furthermore, the Fund cannot control the cybersecurity plans and systems put in place by service providers to the Fund such as the Fund’s custodian and accounting agent, and the Fund’s transfer agent. In addition, many beneficial owners of Fund shares hold them through accounts at broker-dealers, retirement platforms and other financial market participants over which neither the Fund nor the Adviser exercises control. Each of these may in turn rely on service providers to them, which are also subject to the risk of cyber-attacks. Cybersecurity failures or breaches at the Adviser or the Fund’s service providers or intermediaries have the ability to cause disruptions and impact business operations, potentially resulting in |
| financial losses, interference with the Fund’s ability to calculate its net asset value, impediments to trading, the inability of Fund stockholders to effect share purchases or sales or receive distributions, loss of or unauthorized access to private stockholder information and violations of applicable privacy and other laws, regulatory fines, penalties, reputational damage, or additional compliance costs. Such costs and losses may not be covered under any insurance. In addition, maintaining vigilance against cyber-attacks may involve substantial costs over time, and system enhancements may themselves be subject to cyber-attacks. | |
| F. | Statement of Cash Flows |
| Information on financial transactions which have been settled through the receipt or disbursement of cash or restricted cash is presented in the Statement of Cash Flows. Cash as presented in the Fund’s Statement of Assets and Liabilities includes cash on hand at the Fund’s custodian bank and does not include any short-term investments. As of and for the year ended April 30, 2024, the Fund had restricted cash in the form of futures collateral on the Statement of Assets and Liabilities. | |
| G. | Futures Contracts |
| The Fund may enter into futures transactions in order to attempt to hedge against changes in interest rates, securities prices and currency exchange rates or to seek to increase total return. Futures contracts are types of derivatives. | |
| All futures contracts entered into by the Fund are traded on a futures exchange. Upon entering into a futures contract, the Fund is required to deposit with a broker an amount of cash or securities equal to the minimum “initial margin” requirements of the associated futures exchange. The amount of cash deposited with the broker as collateral at April 30, 2024 is recorded as “Futures collateral” on the Statement of Assets and Liabilities. | |
| Subsequent payments for futures contracts (“variation margin”) are paid or received by the Fund, depending on the daily fluctuation in the value of the contracts, and are recorded by the Fund as unrealized appreciation or depreciation. Cash received from or paid to the broker related to previous margin movement is held in a segregated account at the broker and is recorded as either “Due from broker for futures” or “Due to broker for futures” on the Statement of Assets and Liabilities. When the contract is closed, the Fund realizes a gain or loss equal to the difference between the opening and closing value of the contract as well as any fluctuation in foreign currency exchange rates where applicable. Futures contracts are subject to market risk, interest rate risk and currency |
| exchange rate risk. Changes in value of the contracts may not directly correlate to the changes in value of the underlying securities. With futures, there is reduced counterparty credit risk to the Fund since futures are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default. | |
| The average notional values of long position and short position futures contracts during the year ended April 30, 2024 were $2,070,918 and $0, respectively. Open futures contracts outstanding at April 30, 2024 are listed in the Schedule of Investments. |
| Statement of Assets and Liabilities |
Interest Rate Risk |
Credit Risk |
Foreign Exchange Rate Risk |
Equity Risk |
Commodity Risk |
| Liabilities | |||||
| Net unrealized depreciation on futures contracts* | $452,902 | $— | $— | $— | $— |
| Total Value | $452,902 | $— | $— | $— | $— |
| * | Includes cumulative unrealized appreciation (depreciation) of futures contracts as reported in the Schedule of Investments. Only net variation margin is reported within the assets and/or liabilities on the Statement of Assets and Liabilities. |
| Statement of Operations | Interest Rate Risk |
Credit Risk |
Foreign Exchange Rate Risk |
Equity Risk |
Commodity Risk |
| Net Realized Gain (Loss) on | |||||
| Futures contracts | $(755,613) | $— | $— | $— | $— |
| Total Value | $(755,613) | $— | $— | $— | $— |
| Change in Net Unrealized Appreciation (Depreciation) on | |||||
| Futures contracts | $(452,902) | $— | $— | $— | $— |
| Total Value | $(452,902) | $— | $— | $— | $— |
| 4/30/24 | 4/30/23 | |
| Shares outstanding at beginning of year | 22,771,349 | 22,771,349 |
| Shares outstanding at end of year |
prior reporting periods were as follows:
| Year Ended 4/30/24 | Year Ended 4/30/23 | |||
| Shares | Amount | Shares | Amount | |
| VMTP Shares issued | — | $— | — | $— |
| VMTP Shares redeemed | (790) | (79,000,000) | (160) | (16,000,000) |
| Net decrease | (790) | $(79,000,000) | (160) | $(16,000,000) |
June 27, 2024
| • | In an attempt to hedge against adverse changes in the market prices of securities, interest rates or currency exchange rates |
| • | As a substitute for purchasing or selling securities |
| • | To attempt to increase the Fund’s return as a non-hedging strategy that may be considered speculative |
| • | To manage portfolio characteristics (for example, the duration or credit quality of the Fund’s portfolio) |
| • | As a cash flow management technique |
| (1) | Issue senior securities, except as permitted by applicable law, as amended and interpreted or modified from time to time by any regulatory authority jurisdiction. |
| (2) | Borrow money, except as permitted by applicable law, as amended and interpreted or modified from time to time by any regulatory authority jurisdiction. |
| (3) | Invest in real estate, except the Fund may invest in securities of issuers that invest in real estate or interests therein, securities that are secured by real estate or interests therein, securities of real estate investment trusts, mortgage-backed securities and other securities that represent a similar indirect interest in real estate, and the Fund may acquire real estate or interests therein through exercising rights or remedies with regard to an instrument. |
| (4) | Make loans, except that the Fund may (i) lend portfolio securities in accordance with the Fund’s investment policies, (ii) enter into repurchase agreements, (iii) purchase all or a portion of an issue of publicly distributed debt securities, bank loan participation interests, bank certificates of deposit, acceptances, debentures or other securities, whether or not the purchase is made upon the original issuance of the securities, (iv) participate in a credit facility whereby the Fund may directly lend to and borrow money from other affiliated funds to the extent permitted under the 1940 Act or an exemption therefrom and (v) make loans in any other manner consistent with applicable law, as amended and interpreted or modified from time to time by any regulatory authority having jurisdiction. |
| (5) | Invest in commodities or commodity contracts, except that the Fund may invest in currency instruments and contracts and financial |
| instruments and contracts that might be deemed to be commodities and commodity contracts. | |
| (6) | Act as an underwriter, except insofar as the Fund technically may be deemed to be an underwriter in connection with the purchase or sale of its portfolio securities. |
| (7) | Make any investment inconsistent with its classification as a diversified closed-end investment company (or series thereof) under the 1940 Act. |
| (8) | Invest 25% or more of the value of its total assets in any one industry, provided that this limitation does not apply to municipal securities other than those municipal securities backed only by assets and revenues of non-governmental issuers. |
| (9) | Under normal market conditions, the Fund will invest substantially all (at least 80%) of its assets (net assets plus borrowings for investment purposes) in debt securities and other obligations issued by or on behalf of states, territories and possessions of the United States and the District of Columbia and their political subdivisions, agencies and instrumentalities, the interest on which is exempt from regular federal income tax. |
| Preferred shares as a percentage of total managed assets (including assets attributable to preferred shares) | 18.40% |
| Annual effective dividend rate payable by Fund on preferred shares | |
| Annual return Fund portfolio must experience (net of expenses) to cover dividend rate on preferred shares | |
| Common share total return for (10.00)% assumed portfolio total return | ( |
| Common share total return for (5.00)% assumed portfolio total return | ( |
| Common share total return for 0.00% assumed portfolio total return | ( |
| Common share total return for 5.00% assumed portfolio total return | |
| Common share total return for 10.00% assumed portfolio total return |
Amundi Asset Management US, Inc.
The Bank of New York Mellon Corporation
Deloitte ∓ Touche LLP
Morgan, Lewis ∓ Bockius LLP
Equiniti Trust Company, LLC
| Name, Age and Position Held With the Fund |
Term of Office and Length of Service |
Principal Occupation(s) During At Least The Past Five Years | Other Directorships Held by Director During At Least The Past Five Years |
| Thomas J. Perna (73) Chairman of the Board and Director |
Class III Director since 2006. Term expires in 2024. |
Private investor (2004 – 2008 and 2013 – present); Chairman (2008 – 2013) and Chief Executive Officer (2008 – 2012), Quadriserv, Inc. (technology products for securities lending industry); and Senior Executive Vice President, The Bank of New York (financial and securities services) (1986 – 2004) | Director, Broadridge Financial Solutions, Inc. (investor communications and securities processing provider for financial services industry) (2009 – 2023); Director, Quadriserv, Inc. (2005 – 2013); and Commissioner, New Jersey State Civil Service Commission (2011 – 2015) |
| John E. Baumgardner, Jr. (73)* Director |
Class I Director since 2019. Term expires in 2025. |
Of Counsel (2019 – present), Partner (1983-2018), Sullivan ∓ Cromwell LLP (law firm). | Chairman, The Lakeville Journal Company, LLC, (privately-held community newspaper group) (2015-present) |
| Diane Durnin (67) Director |
Class II Director since 2020. Term expires in 2026. |
Managing Director - Head of Product Strategy and Development, BNY Mellon Investment Management (investment management firm) (2012-2018); Vice Chairman – The Dreyfus Corporation (2005 – 2018): Executive Vice President Head of Product, BNY Mellon Investment Management (2007-2012); Executive Director- Product Strategy, Mellon Asset Management (2005-2007); Executive Vice President Head of Products, Marketing and Client Service, Dreyfus Corporation (investment management firm) (2000-2005); Senior Vice President Strategic Product and Business Development, Dreyfus Corporation (1994-2000) | None |
| Name, Age and Position Held With the Fund |
Term of Office and Length of Service |
Principal Occupation(s) During At Least The Past Five Years | Other Directorships Held by Director During At Least The Past Five Years |
| Benjamin M. Friedman (79) Director |
Class II Director since 2008. Term expires in 2026. |
William Joseph Maier Professor of Political Economy, Harvard University (1972 – present) | Trustee, Mellon Institutional Funds Investment Trust and Mellon Institutional Funds Master Portfolio (oversaw 17 portfolios in fund complex) (1989 - 2008) |
| Craig C. MacKay (61) Director |
Class III Director since 2021. Term expires in 2024. |
Partner, England ∓ Company, LLC (advisory firm) (2012 – present); Group Head – Leveraged Finance Distribution, Oppenheimer ∓ Company (investment bank) (2006 – 2012); Group Head – Private Finance ∓ High Yield Capital Markets Origination, SunTrust Robinson Humphrey (investment bank) (2003 – 2006); and Founder and Chief Executive Officer, HNY Associates, LLC (investment bank) (1996 – 2003) | Director, Equitable Holdings, Inc. (financial services holding company) (2022 – present); Board Member of Carver Bancorp, Inc. (holding company) and Carver Federal Savings Bank, NA (2017 – present); Advisory Council Member, MasterShares ETF (2016 – 2017); Advisory Council Member, The Deal (financial market information publisher) (2015 – 2016); Board Co-Chairman and Chief Executive Officer, Danis Transportation Company (privately-owned commercial carrier) (2000 – 2003); Board Member and Chief Financial Officer, Customer Access Resources (privately-owned teleservices company) (1998 – 2000); Board Member, Federation of Protestant Welfare Agencies (human services agency) (1993 – present); and Board Treasurer, Harlem Dowling Westside Center (foster care agency) (1999 – 2018) |
| Name, Age and Position Held With the Fund |
Term of Office and Length of Service |
Principal Occupation(s) During At Least The Past Five Years | Other Directorships Held by Director During At Least The Past Five Years |
| Lorraine H. Monchak (68) Director |
Class I Director since 2015. Term expires in 2025. |
Chief Investment Officer, 1199 SEIU Funds (healthcare workers union pension funds) (2001 – present); Vice President – International Investments Group, American International Group, Inc. (insurance company) (1993 – 2001); Vice President Corporate Finance and Treasury Group, Citibank, N.A. (1980 – 1986 and 1990 – 1993); Vice President – Asset/Liability Management Group, Federal Farm Funding Corporation (government-sponsored issuer of debt securities) (1988 – 1990); Mortgage Strategies Group, Shearson Lehman Hutton, Inc. (investment bank) (1987 – 1988); Mortgage Strategies Group, Drexel Burnham Lambert, Ltd. (investment bank) (1986 – 1987) | None |
| Fred J. Ricciardi (77) Director |
Class III Director since 2014. Term expires in 2024. |
Private investor (2020 – present); Consultant (investment company services) (2012 – 2020); Executive Vice President, BNY Mellon (financial and investment company services) (1969 – 2012); Director, BNY International Financing Corp. (financial services) (2002 – 2012); Director, Mellon Overseas Investment Corp. (financial services) (2009 – 2012); Director, Financial Models (technology) (2005-2007); Director, BNY Hamilton Funds, Ireland (offshore investment companies) (2004-2007); Chairman/Director, AIB/BNY Securities Services, Ltd., Ireland (financial services) (1999-2006); Chairman, BNY Alternative Investment Services, Inc. (financial services) (2005-2007) | None |
| * Mr. Baumgardner is Of Counsel to Sullivan ∓ Cromwell LLP, which acts as counsel to the Independent Directors of each Pioneer Fund. | |||
| Name, Age and Position Held With the Fund |
Term of Office and Length of Service |
Principal Occupation(s) During At Least The Past Five Years | Other Directorships Held by Director During At Least The Past Five Years |
| Lisa M. Jones (62)** Director, President and Chief Executive Officer |
Class I Director since 2014. Term expires in 2025. |
Director, CEO and President of Amundi US, Inc. (investment management firm) (since September 2014); Director, CEO and President of Amundi Asset Management US, Inc. (since September 2014); Director, CEO and President of Amundi Distributor US, Inc. (since September 2014); Director, CEO and President of Amundi Asset Management US, Inc. (since September 2014); Chair, Amundi US, Inc., Amundi Distributor US, Inc. and Amundi Asset Management US, Inc. (September 2014 – 2018); Managing Director, Morgan Stanley Investment Management (investment management firm) (2010 – 2013); Director of Institutional Business, CEO of International, Eaton Vance Management (investment management firm) (2005 – 2010); Director of Amundi Holdings US, Inc. (since 2017) | Director of Clearwater Analytics (provider of web-based investment accounting software for reporting and reconciliation services) (September 2022 – present) |
| Marco Pirondini (57)** Director, Executive Vice President |
Class II Director since January 2024. Term expires in 2026. |
Executive Vice President and Chief Investment Officer of Amundi Asset Management US, Inc. since January 2024; Senior Managing Director and Head of Equities U.S. of Amundi US from 2010 to December 2023 | None |
| ** Ms. Jones and Mr. Pirondini are Interested Directors because they are an officer or director of the Fund’s investment adviser and certain of its affiliates. | |||
| Name, Age and Position Held With the Fund |
Term of Office and Length of Service |
Principal Occupation(s) During At Least The Past Five Years | Other Directorships Held by Director During At Least The Past Five Years |
| Marguerite A. Piret (75)*** Advisory Director |
Advisory Director since January 2024 (Class III Director from 2003 to January 2024). |
Chief Financial Officer, American Ag Energy, Inc. (technology for the environment, energy and agriculture) (2019 – present); Chief Operating Officer, North Country Growers LLC (controlled environment agriculture company) (2020 – present); Chief Executive Officer, Green Heat LLC (biofuels company) (2022 – present); President and Chief Executive Officer, Newbury Piret Company (investment banking firm) (1981 – 2019) | Director of New America High Income Fund, Inc. (closed-end investment company) (2004 – present); and Member, Board of Governors, Investment Company Institute (2000 – 2006) |
| *** Ms. Piret became a non-voting Advisory Director effective January 22, 2024. | |||
| Name, Age and Position Held With the Fund |
Term of Office and Length of Service |
Principal Occupation(s) During At Least The Past Five Years | Other Directorships Held by Officer During At Least The Past Five Years |
| Christopher J. Kelley (59) Secretary and Chief Legal Officer |
Since 2003. Serves at the discretion of the Board |
Senior Vice President and Deputy General Counsel of Amundi US since March 2024; Vice President and Associate General Counsel of Amundi US from January 2008 to March 2024; Secretary and Chief Legal Officer of all of the Pioneer Funds since June 2010; Assistant Secretary of all of the Pioneer Funds from September 2003 to May 2010; Vice President and Senior Counsel of Amundi US from July 2002 to December 2007 | None |
| Thomas Reyes (61) Assistant Secretary |
Since 2010. Serves at the discretion of the Board |
Associate General Counsel of Amundi US since March 2023; Assistant Secretary of all the Pioneer Funds since June 2010; Assistant General Counsel of Amundi US from May 2013 to March 2023 and Counsel of Amundi US from June 2007 to May 2013 | None |
| Heather L. Melito-Dezan (47) Assistant Secretary |
Since 2022. Serves at the discretion of the Board |
Director - Trustee and Board Relationships of Amundi US since September 2019; Assistant Secretary of Amundi US, Inc. since July 2020: Assistant Secretary of Amundi Asset Management US, Inc. since July 2020: Assistant Secretary of Amundi Distributor US, Inc. since July 2020; Assistant Secretary of all the Pioneer Funds since September 2022; Private practice from 2017 – 2019. | None |
| Anthony J. Koenig, Jr. (60) Treasurer and Chief Financial and Accounting Officer |
Since 2021. Serves at the discretion of the Board |
Managing Director, Chief Operations Officer and Fund Treasurer of Amundi US since May 2021; Treasurer of all of the Pioneer Funds since May 2021; Assistant Treasurer of all of the Pioneer Funds from January 2021 to May 2021; and Chief of Staff, US Investment Management of Amundi US from May 2008 to January 2021 | None |
| Luis I. Presutti (59) Assistant Treasurer |
Since 2003. Serves at the discretion of the Board |
Director – Fund Treasury of Amundi US since 1999; and Assistant Treasurer of all of the Pioneer Funds since 1999 | None |
| Name, Age and Position Held With the Fund |
Term of Office and Length of Service |
Principal Occupation(s) During At Least The Past Five Years | Other Directorships Held by Officer During At Least The Past Five Years |
| Gary Sullivan (66) Assistant Treasurer |
Since 2003. Serves at the discretion of the Board |
Senior Manager – Fund Treasury of Amundi US since 2012; and Assistant Treasurer of all of the Pioneer Funds since 2002 | None |
| Antonio Furtado (42) Assistant Treasurer |
Since 2020. Serves at the discretion of the Board |
Fund Oversight Manager – Fund Treasury of Amundi US since 2020; Assistant Treasurer of all of the Pioneer Funds since 2020; and Senior Fund Treasury Analyst from 2012 - 2020 | None |
| Michael Melnick (53) Assistant Treasurer |
Since 2021. Serves at the discretion of the Board |
Vice President - Deputy Fund Treasurer of Amundi US since May 2021; Assistant Treasurer of all of the Pioneer Funds since July 2021; Director of Regulatory Reporting of Amundi US from 2001 – 2021; and Director of Tax of Amundi US from 2000 - 2001 | None |
| John Malone (53) Chief Compliance Officer |
Since 2018. Serves at the discretion of the Board |
Managing Director, Chief Compliance Officer of Amundi US Asset Management; Amundi Asset Management US, Inc.; and the Pioneer Funds since September 2018; Chief Compliance Officer of Amundi Distributor US, Inc. since January 2014. | None |
| Brandon Austin (52) Anti-Money Laundering Officer |
Since 2022. Serves at the discretion of the Board |
Director, Financial Security – Amundi Asset Management; Anti-Money Laundering Officer of all the Pioneer Funds since March 2022: Director of Financial Security of Amundi US since July 2021; Vice President, Head of BSA, AML and OFAC, Deputy Compliance Manager, Crédit Agricole Indosuez Wealth Management (investment management firm) (2013 – 2021) | None |
change of address, lost stock certificates,Company, LLC
stock transferOperations Center
6201 15th Ave.
Brooklyn, NY 11219
Company, LLC
Wall Street Station
P.O. Box 922
New York, NY 10269-0560
60 State Street
Boston, MA 02109
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.
1
(f) The registrant must:
(1) File with the Commission, pursuant to Item 12(a)(1), 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 (see attachment);
(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 Directors 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 Directors 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 Directors, 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)).
Mr. Fred J. Ricciardi, an independent Director, 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.
2
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.
The audit fees for the Fund were $47,300 payable to Deloitte & Touche LLP for the year ended April 30, 2024 and $45,505 payable to Ernst & Young LLP for the year ended April 30, 2023.
(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.
The audit-related services fees for the Fund were $0 payable to Deloitte & Touche LLP and $276 payable to Ernst & Young for the year ended April 30, 2024 and $1,950 payable to Ernst & Young LLP for the year ended April 30, 2023.
(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.
The Fund paid aggregate non-audit fees to Deloitte & Touche LLP for tax services of $10,500 and $10,105 to Ernst & Young LLP for during the fiscal years ended April 30, 2024 and 2023, 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.
There were no other fees in 2023 or 2024.
(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 Amundi Asset Management US, Inc., 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.
3
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.
4
SECTION II - POLICY
| SERVICE CATEGORY |
SERVICE CATEGORY DESCRIPTION |
SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES | ||
| I. AUDIT SERVICES | Services that are directly related to performing the independent audit of the Funds | • Accounting research assistance
• SEC consultation, registration statements, and reporting
• Tax accrual related matters
• Implementation of new accounting standards
• Compliance letters (e.g. rating agency letters)
• Regulatory reviews and assistance regarding financial matters
• Semi-annual reviews (if requested)
• Comfort letters for closed end offerings | ||
| II. AUDIT-RELATED SERVICES | Services which are not prohibited under Rule 210.2-01(C)(4) (the “Rule”) and are related extensions of the audit services support the 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.) | • AICPA attest and agreed-upon procedures
• Technology control assessments
• Financial reporting control assessments
• Enterprise security architecture assessment | ||
| AUDIT COMMITTEE APPROVAL POLICY |
AUDIT COMMITTEE REPORTING POLICY | |
| • “One-time” pre-approval for the audit period for all pre-approved specific service subcategories. Approval of the independent auditors as auditors for a Fund shall constitute pre approval for these services. |
• A summary of all such services and related fees reported at each regularly scheduled Audit Committee meeting. | |
| • “One-time” pre-approval for the fund fiscal year within a specified dollar limit for all pre-approved specific service subcategories |
• A summary of all such services and related fees (including comparison to specified dollar limits) reported quarterly. | |
5
| • 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) |
||
| • 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” |
||
6
SECTION III - POLICY DETAIL, CONTINUED
| SERVICE CATEGORY |
SERVICE CATEGORY DESCRIPTION |
SPECIFIC PRE-APPROVED | ||
| III. TAX SERVICES | Services which are not prohibited by the Rule, if an officer of the Fund determines that using the Fund’s auditor to provide these services creates significant synergy in the form of efficiency, minimized disruption, or the ability to maintain a desired level of confidentiality. | • Tax planning and support
• Tax controversy assistance
• Tax compliance, tax returns, excise tax returns and support
• Tax opinions |
| AUDIT COMMITTEE APPROVAL POLICY |
AUDIT COMMITTEE REPORTING POLICY | |
| • “One-time” pre-approval for the fund fiscal year within a specified dollar limit |
• A summary of all such services and related fees (including comparison to specified dollar limits) reported quarterly. | |
| • 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) |
||
| • 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” |
||
7
SECTION III - POLICY DETAIL, CONTINUED
| SERVICE CATEGORY |
SERVICE CATEGORY DESCRIPTION |
SPECIFIC PRE-APPROVED | ||
| IV. OTHER SERVICES | Services which are not prohibited by the Rule, if an officer of the Fund 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. | • Business Risk Management support | ||
|
A. SYNERGISTIC, UNIQUE QUALIFICATIONS |
• Other control and regulatory compliance projects | |||
| AUDIT COMMITTEE APPROVAL POLICY |
AUDIT COMMITTEE REPORTING POLICY | |
| • “One-time” pre-approval for the fund fiscal year within a specified dollar limit |
• A summary of all such services and related fees (including comparison to specified dollar limits) reported quarterly. | |
| • 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) |
||
| • 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” |
||
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SECTION III - POLICY DETAIL, CONTINUED
| SERVICE CATEGORY |
SERVICE CATEGORY DESCRIPTION |
SPECIFIC PROHIBITED | ||
| PROHIBITED SERVICES | Services which result in the auditors losing independence status under the Rule. | 1. Bookkeeping or other services related to the accounting records or financial statements of the audit 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 | |
| • These services are not to be performed with the exception of the(*) services that may be permitted if they would not be subject to audit procedures at the audit client (as defined in rule 2-01(f)(4)) level the firm providing the service. |
• A summary of all services and related fees reported at each regularly scheduled Audit Committee meeting will serve as continual confirmation that has not provided any restricted services. |
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GENERAL AUDIT COMMITTEE APPROVAL POLICY:
| • | 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. |
| • | 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. |
| • | 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 Fund’s 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 Fund. For the years ended April 30, 2024 and 2023, there were no services provided to an affiliate that required the Fund’s audit committee pre-approval.
(f) If greater than 50 percent, disclose the percentage of hours expended on the principal accountants 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 registrants accountant for services rendered to the registrant, and rendered to the registrants 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 Fund paid aggregate non-audit fees to Deloitte & Touche LLP for tax services of $10,500 and $10,105 to Ernst & Young LLP for during the fiscal years ended April 30, 2024 and 2023, respectively.
(h) Disclose whether the registrants audit committee of the Board of Directors has considered whether the provision of non-audit services that were rendered to the registrants 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 Fund’s audit committee of the Board of Directors 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.
(i) A registrant identified by the Commission pursuant to Section 104(i)(2)(A) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7214(i)(2)(A)), as having retained, for the preparation of the audit report on its financial statements included in the Form NCSR, a registered public accounting firm that has a branch or office that is located in a foreign jurisdiction and that the Public Company Accounting Oversight Board has determined it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction must electronically submit to the Commission on a supplemental basis documentation that establishes that the registrant is not owned or controlled by a governmental entity in the foreign jurisdiction. The registrant must submit this documentation on or before the due date for this form. A registrant that is owned or controlled by a foreign governmental entity is not required to submit such documentation.
10
N/A
(j) A registrant that is a foreign issuer, as defined in 17 CFR 240.3b-4, identified by the Commission pursuant to Section 104(i)(2)(A) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7214(i)(2)(A)), as having retained, for the preparation of the audit report on its financial statements included in the Form N-CSR, a registered public accounting firm that has a branch or office that is located in a foreign jurisdiction and that the Public Company Accounting Oversight Board has determined it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction, for each year in which the registrant is so identified, must provide the below disclosures. Also, any such identified foreign issuer that uses a variable-interest entity or any similar structure that results in additional foreign entities being consolidated in the financial statements of the registrant is required to provide the below disclosures for itself and its consolidated foreign operating entity or entities. A registrant must disclose:
(1) That, for the immediately preceding annual financial statement period, a registered public accounting firm that the PCAOB was unable to inspect or investigate completely, because of a position taken by an authority in the foreign jurisdiction, issued an audit report for the registrant;
N/A
(2) The percentage of shares of the registrant owned by governmental entities in the foreign jurisdiction in which the registrant is incorporated or otherwise organized;
N/A
(3) Whether governmental entities in the applicable foreign jurisdiction with respect to that registered public accounting firm have a controlling financial interest with respect to the registrant;
N/A
(4) The name of each official of the Chinese Communist Party who is a member of the board of directors of the registrant or the operating entity with respect to the registrant;
N/A
(5) Whether the articles of incorporation of the registrant (or equivalent organizing document) contains any charter of the Chinese Communist Party, including the text of any such charter.
N/A
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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 registrant’s audit committee as specified in Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)), so state.
N/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 of Investments in securities of unaffiliated issuers as of the close of the reporting period as set forth in 210.1212 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.
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. Proxy voting policies and procedures
Policy
Each of the Pioneer Funds and certain other clients of Amundi Asset Management US, Inc. (“Amundi US”) have delegated responsibility to vote proxies related to portfolio holdings to Amundi US. Amundi US is a fiduciary that owes each of its clients the duties of care and loyalty with respect to all services undertaken on the client’s behalf, including voting proxies for securities held by the client. When Amundi US has been delegated proxy-voting authority for a client, the duty of care requires Amundi US to monitor corporate events and to vote the proxies. To satisfy its duty of loyalty, Amundi US must place the client’s interests ahead of its own and must cast proxy votes in a manner consistent with the best interest of the client. It is Amundi US’s policy to vote proxies presented to Amundi US in a timely manner in accordance with these principles.
Amundi US’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, Amundi US 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. Amundi US monitors developments in the proxy voting arena and will revise this policy as needed.
Amundi US believes that environmental, social and governance (ESG) factors can affect companies’ long-term prospects for success and the sustainability of their business models. Since ESG factors that may affect corporate performance and economic value are considered by our investment professionals as part of the investment management process, Amundi US also considers these factors when reviewing proxy proposals. This approach is consistent with the stated investment objectives and policies of funds and investment strategies.
It should be noted that the proxy voting guidelines below are guidelines, not rules, and Amundi US reserves the right in all cases to vote contrary to guidelines where doing so is determined to represent the best economic interests of our clients. Further, the Pioneer Funds or other clients of Amundi US may direct Amundi US to vote contrary to guidelines.
Amundi US’s clients may request copies of their proxy voting records and of Amundi US’s proxy voting policies and procedures by either sending a written request to Amundi US’s Proxy Coordinator, or clients may review Amundi US’s proxy voting policies and procedures on-line at amundi.com/usinvestors. Amundi US may describe to clients its proxy voting policies and procedures by delivering a copy of Amundi US’s Form ADV (Part II), by separate notice to the client or by other means.
Applicability
This Proxy Voting policy and the procedures set forth below are designed to complement Amundi US’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 Amundi US. This policy sets forth Amundi US’s position on a number of issues for which proxies may be solicited but it does not include all potential voting scenarios or proxy events. Furthermore, because of the special issues associated with proxy solicitations by closed-end Funds, Amundi US will vote shares of closed-end Funds on a case-by-case basis.
Purpose
The purpose of this policy is to ensure that proxies for United States (“US”) and non-US companies that are received in a timely manner will be voted in accordance with the principles stated above. Unless the Proxy Voting Oversight Group (as described below) specifically determines otherwise, all shares in a company held by Amundi US-managed accounts for which Amundi US has proxy-voting authority will be voted alike, unless a client has given specific voting instructions on an issue.
Amundi US does not delegate the authority to vote proxies relating to securities held by its clients to any of its affiliates. Any questions about this policy should be directed to Amundi US’s Chief of Staff, US Investment Management (the “Proxy Coordinator”).
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Procedures
Proxy Voting Service
Amundi US 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. The proxy voting service votes all proxies in accordance with the proxy voting guidelines established by Amundi US and set forth herein, to the extent applicable. 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. Amundi US 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.
To supplement its own research and analysis in determining how to vote on a particular proxy proposal, Amundi US may utilize research, analysis or recommendations provided by the proxy voting service on a case-by-case basis. Amundi US does not, as a policy, follow the assessments or recommendations provided by the proxy voting service without its own analysis and determination.
Proxy Coordinator
The Proxy Coordinator coordinates the voting, procedures and reporting of proxies on behalf of Amundi US’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 Portfolio Management Group, 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 General Counsel or his or her designee whether Amundi US’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 director or other fiduciaries).
Referral Items
The proxy voting service will refer proxy questions to the Proxy Coordinator or his or her designee that are described by Amundi US’s proxy voting guidelines as to be voted on a case-by-case basis, that are not covered by Amundi US’s guidelines or where Amundi US’s guidelines may be unclear with respect to the matter to be voted on. Under such circumstances, the Proxy Coordinator will seek a written voting recommendation from the Chief Investment Officer, U.S. or his or her designated equity portfolio-management representative. 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 Amundi US and any outside parties concerning the proxy proposal prior to the time that the voting instructions are provided.
Securities Lending
In accordance with industry standards, proxies are not available to be voted when the shares are out on loan through either Amundi US’s lending program or a client’s managed security lending program. However, Amundi US will reserve the right to recall lent securities so that they may be voted according to Amundi US’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. Certain clients participate in securities lending programs. Although such programs allow for the recall of securities for any reason, Amundi US may determine not to vote securities on loan and it may not always be possible for securities on loan to be recalled in time to be voted.
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).
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Amundi US 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.
Proxy Voting Oversight Group
The members of the Proxy Voting Oversight Group include Amundi US’s Chief Investment Officer, U.S. or his or her designated equity portfolio management representative, the Chief of Staff, U.S., and the Chief Compliance Officer of the Adviser and Funds. Other members of Amundi US will be invited to attend meetings and otherwise participate as necessary. The Chief of Staff, U.S. will chair the Proxy Voting Oversight Group.
The Proxy Voting Oversight Group is responsible for developing, evaluating, and changing (when necessary) Amundi US’s proxy voting policies and procedures. The Group meets at least annually to evaluate and review this policy 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
Amundi US may not amend this policy without the prior approval of the Proxy Voting Oversight Group.
Form N-PX
The Proxy Coordinator and the Director of Regulatory Reporting are responsible for ensuring that Form N-PX documents receive the proper review by a member of the Proxy Voting Oversight Group prior to a Fund officer signing the forms.
The Investment Operations department will provide the Compliance department with a copy of each Form N-PX filing prepared by the proxy voting service.
Compliance files N-PX. The Compliance department will ensure that a corresponding Form N-PX exists for each Amundi US registered investment company.
Following this review, each Form N-PX is formatted for public dissemination via the EDGAR system.
Prior to submission, each Form N-PX is to be presented to the Fund officer for a final review and signature.
Copies of the Form N-PX filings and their submission receipts are maintained according to Amundi US record keeping policies.
Proxy Voting Guidelines
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:
| • | Corporate name change. |
| • | A change of corporate headquarters. |
| • | Stock exchange listing. |
| • | Establishment of time and place of annual meeting. |
| • | Adjournment or postponement of annual meeting. |
| • | Acceptance/approval of financial statements. |
| • | Approval of dividend payments, dividend reinvestment plans and other dividend-related proposals. |
| • | Approval of minutes and other formalities. |
15
| • | Authorization of the transferring of reserves and allocation of income. |
| • | Amendments to authorized signatories. |
| • | Approval of accounting method changes or change in fiscal year-end. |
| • | Acceptance of labor agreements. |
| • | Appointment of internal auditors. |
Amundi US will vote on a case-by-case basis on other routine administrative items; however, Amundi US will oppose any routine proposal if insufficient information is presented in advance to allow Amundi US to judge the merit of the proposal. Amundi US has also instructed its proxy voting service to inform Amundi US of its analysis of any administrative items that may be inconsistent, in its view, with Amundi US’s goal of supporting the value of its clients’ portfolio holdings so that Amundi US may consider and vote on those items on a case-by-case basis in its discretion.
Auditors
We normally vote for proposals to:
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 for 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.
| • | Restore shareholder rights to ratify the auditors. |
We will normally oppose proposals that require companies to:
| • | Seek bids from other auditors. |
| • | Rotate auditing firms, except where the rotation is statutorily required or where rotation would demonstrably strengthen financial disclosure. |
| • | Indemnify auditors. |
| • | Prohibit auditors from engaging in non-audit services for the company. |
Board of Directors
On issues related to the board of directors, Amundi US normally supports management. We will, however, consider a vote against management in instances where corporate performance has been poor or where the board appears to lack independence.
General Board Issues
Amundi US will vote for:
| • | Audit, compensation and nominating committees composed of independent directors exclusively. |
| • | Indemnification for directors for actions taken in good faith in accordance with the business judgment rule. We will vote against proposals for broader indemnification. |
| • | Changes in board size that appear to have a legitimate business purpose and are not primarily for anti-takeover reasons. |
| • | Election of an honorary director. |
We will vote against:
| • | Minimum stock ownership by directors. |
| • | Term limits for directors. Companies benefit from experienced directors, and shareholder control is better achieved through annual votes. |
| • | Requirements for union or special interest representation on the board. |
| • | Requirements to provide two candidates for each board seat. |
We will vote on a case-by case basis on these issues:
| • | Separate chairman and CEO positions. We will consider voting with shareholders on these issues in cases of poor corporate performance. |
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Elections of Directors
In uncontested elections of directors we will vote against:
| • | Individual directors with absenteeism above 25% without valid reason. We support proposals that require disclosure of director attendance. |
| • | Insider directors and affiliated outsiders who sit on the audit, compensation, stock option or nominating committees. For the purposes of our policy, we use the definition of affiliated directors provided by our proxy voting service. |
We will also vote against:
| • | Directors who have failed to act on a takeover offer where the majority of shareholders have tendered their shares. |
| • | Directors who appear to lack independence or are associated with poor corporate or governance performance. |
We will vote on a case-by case basis on these issues:
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).
| • | Contested election of directors. |
| • | Election of a greater number of independent directors (in order to move closer to a majority of independent directors) in cases of poor performance. |
| • | Mandatory retirement policies. |
| • | Directors who have ignored a shareholder proposal that has been approved by shareholders for two consecutive years. |
We will vote for:
| • | Precatory and binding resolutions requesting that the board changes the company’s bylaws to stipulate that directors need to be elected with affirmative majority of votes cast, provided that the resolutions allow for plurality voting in cases of contested elections. |
Takeover-Related Measures
Amundi US 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.
Amundi US will vote for:
| • | Cumulative voting. |
| • | Increasing the ability for shareholders to call special meetings. |
| • | Increasing the ability for shareholders to act by written consent. |
| • | Restrictions on the ability to make greenmail payments. |
| • | Submitting rights plans to shareholder vote. |
| • | Rescinding shareholder rights plans (“poison pills”). |
| • | Opting out of the following state takeover statutes: |
| • | Control share acquisition statutes, which deny large holders voting rights on holdings over a specified threshold. |
| • | Control share cash-out provisions, which require large holders to acquire shares from other holders. |
| • | Freeze-out provisions, which impose a waiting period on large holders before they can attempt to gain control. |
| • | Stakeholder laws, which permit directors to consider interests of non-shareholder constituencies. |
| • | Disgorgement provisions, which require acquirers to disgorge profits on purchases made before gaining control. |
| • | Fair price provisions. |
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| • | Authorization of shareholder rights plans. |
| • | Labor protection provisions. |
| • | Mandatory classified boards. |
We will vote on a case-by-case basis on the following issues:
| • | 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. |
| • | 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. |
| • | Proposals that allow shareholders to nominate directors. |
We will vote against:
| • | Classified boards, except in the case of closed-end funds, where we shall vote on a case-by-case basis. |
| • | Limiting shareholder ability to remove or appoint directors. We will support proposals to restore shareholder authority in this area. We will review on case-by-case basis proposals that authorize the board to make interim appointments. |
| • | Classes of shares with unequal voting rights. |
| • | Supermajority vote requirements. |
| • | Severance packages (“golden” and “tin” parachutes). We will support proposals to put these packages to shareholder vote. |
| • | 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. |
| • | Extension of advance notice requirements for shareholder proposals. |
| • | Granting board authority normally retained by shareholders, particularly the right to amend the corporate charter. |
| • | 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. |
Capital Structure
Managements need considerable flexibility in determining the company’s financial structure, and Amundi US normally supports managements’ proposals in this area. We will, however, reject proposals that impose high barriers to potential takeovers.
Amundi US will vote for:
| • | Changes in par value. |
| • | Reverse splits, if accompanied by a reduction in number of shares. |
| • | Shares repurchase programs, if all shareholders may participate on equal terms. |
| • | Bond issuance. |
| • | Increases in “ordinary” preferred stock. |
| • | Proposals to have blank-check common stock placements (other than shares issued in the normal course of business) submitted for shareholder approval. |
| • | Cancellation of company treasury shares. |
We will vote on a case-by-case basis on the following issues:
| • | Reverse splits not accompanied by a reduction in number of shares, considering the risk of delisting. |
| • | Increase in authorized common stock. We will make a determination considering, among other factors: |
| • | Number of shares currently available for issuance; |
| • | Size of requested increase (we would normally approve increases of up to 100% of current authorization); |
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| • | Proposed use of the proceeds from the issuance of additional shares; and |
| • | Potential consequences of a failure to increase the number of shares outstanding (e.g., delisting or bankruptcy). |
| • | 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. |
| • | Proposals to submit private placements to shareholder vote. |
| • | Other financing plans. |
We will vote against preemptive rights that we believe limit a company’s financing flexibility.
Compensation
Amundi US 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 place limits on the potential dilution these plans may impose.
Amundi US will vote for:
| • | 401(k) benefit plans. |
| • | 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. |
| • | Various issues related to the Omnibus Budget and Reconciliation Act of 1993 (OBRA), including: |
| • | Amendments to performance plans to conform with OBRA; |
| • | Caps on annual grants or amendments of administrative features; |
| • | Adding performance goals; and |
| • | Cash or cash-and-stock bonus plans. |
| • | Establish a process to link pay, including stock-option grants, to performance, leaving specifics of implementation to the company. |
| • | Require that option repricing be submitted to shareholders. |
| • | Require the expensing of stock-option awards. |
| • | Require reporting of executive retirement benefits (deferred compensation, split-dollar life insurance, SERPs, and pension benefits). |
| • | 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%. |
We will vote on a case-by-case basis on the following issues:
| • | Shareholder proposals seeking additional disclosure of executive and director pay information. |
| • | Executive and director stock-related compensation plans. We will consider the following factors when reviewing these plans: |
| • | 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. |
| • | The plan must not: |
| • | Explicitly permit unlimited option repricing authority or have allowed option repricing in the past without shareholder approval. |
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| • | Be a self-replenishing “evergreen” plan or a plan that grants discount options and tax offset payments. |
| • | We are generally in favor of proposals that increase participation beyond executives. |
| • | 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. |
| • | 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. |
| • | We generally support proposals asking companies to adopt stock holding periods for their executives. |
| • | All other employee stock purchase plans. |
| • | All other compensation-related proposals, including deferred compensation plans, employment agreements, loan guarantee programs and retirement plans. |
| • | 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. |
We will vote against:
| • | Pensions for non-employee directors. We believe these retirement plans reduce director objectivity. |
| • | Elimination of stock option plans. |
We will vote on a case-by case basis on these issues:
| • | Limits on executive and director pay. |
| • | Stock in lieu of cash compensation for directors. |
Corporate Governance
Amundi US will vote for:
| • | Confidential voting. |
| • | Equal access provisions, which allow shareholders to contribute their opinions to proxy materials. |
| • | 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:
| • | 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. |
| • | Bundled proposals. We will evaluate the overall impact of the proposal. |
| • | Adopting or amending the charter, bylaws or articles of association. |
| • | Shareholder appraisal rights, which allow shareholders to demand judicial review of an acquisition price. |
We will vote against:
| • | Shareholder advisory committees. While management should solicit shareholder input, we prefer to leave the method of doing so to management’s discretion. |
| • | Limitations on stock ownership or voting rights. |
| • | Reduction in share ownership disclosure guidelines. |
Mergers and Restructurings
Amundi US will vote on the following and similar issues on a case-by-case basis:
| • | Mergers and acquisitions. |
| • | Corporate restructurings, including spin-offs, liquidations, asset sales, joint ventures, conversions to holding company and conversions to self-managed REIT structure. |
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| • | Debt restructurings. |
| • | Conversion of securities. |
| • | Issuance of shares to facilitate a merger. |
| • | Private placements, warrants, convertible debentures. |
| • | 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.
Investment Companies
Many of our portfolios may invest in shares of closed-end funds or open-end funds (including exchange-traded funds). The non-corporate structure of these investments raises several unique proxy voting issues.
Amundi US will vote for:
| • | Establishment of new classes or series of shares. |
| • | Establishment of a master-feeder structure. |
Amundi US will vote on a case-by-case basis on:
| • | 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. |
| • | Approval of new or amended advisory contracts. |
| • | Changes from closed-end to open-end format. |
| • | Election of a greater number of independent directors. |
| • | Authorization for, or increase in, preferred shares. |
| • | Disposition of assets, termination, liquidation, or mergers. |
| • | Classified boards of closed-end funds, but will typically support such proposals. |
In general, business development companies (BDCs) are not considered investment companies for these purposes but are treated as corporate issuers.
Environmental and Social Issues
Amundi US believes that environmental and social issues may influence corporate performance and economic return. Indeed, by analyzing all of a company’s risks and opportunities, Amundi US can better assess its intrinsic value and long-term economic prospects.
When evaluating proxy proposals relating to environmental or social issues, decisions are made on a case-by-case basis. We consider each of these proposals based on the impact to the company’s shareholders and economic return, the specific circumstances at each individual company, any potentially adverse economic concerns, and the current policies and practices of the company.
For example, shareholder proposals relating to environmental and social issues, and on which we will vote on a base-by-case basis, may include those seeking that a company:
| • | Conduct studies regarding certain environmental or social issues; |
| • | Study the feasibility of the company taking certain actions with regard to such issues; or |
| • | Take specific action, including adopting or ceasing certain behavior and adopting company standards and principles, in relation to such issues. |
In general, Amundi US believes these issues are important and should receive management attention.
Amundi US will support proposals where we believe the proposal, if implemented, would improve the prospects for the long-term success of the business and would provide value to the company and its shareholders. Amundi US may abstain on shareholder proposals with regard to environmental and social issues in cases where we believe the proposal, if implemented, would not be in the economic interests of the company, or where implementing the proposal would constrain management flexibility or would be unduly difficult, burdensome or costly.
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When evaluating proxy proposals relating to environmental or social issues, Amundi US may consider the following factors or other factors deemed relevant, given such weight as deemed appropriate:
| • | approval of the proposal helps improve the company’s practices; |
| • | approval of the proposal can improve shareholder value; |
| • | the company’s current stance on the topic is likely to have negative effects on its business position or reputation in the short, medium, or long term; |
| • | the company has already put appropriate action in place to respond to the issue contained in the proposal; |
| • | the company’s reasoning against approving the proposal responds appropriately to the various points mentioned by the shareholder when the proposal was presented; |
| • | the solutions recommended in the proposal are relevant and appropriate, and if the topic of the proposal would not be better addressed through another means. |
In the event of failures in risk management relating to environmental and social issues, Amundi US may vote against the election of directors responsible for overseeing these areas.
Amundi US 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.
Conflicts of interest
Amundi US recognizes that in certain circumstances a conflict of interest may arise when Amundi US votes a proxy.
A conflict of interest occurs when Amundi US’s interests interfere, or appear to interfere, with the interests of Amundi US’s clients.
A conflict may be actual or perceived and may exist, for example, when the matter to be voted on concerns:
| • | An affiliate of Amundi US, such as another company belonging to the Credit Agricole banking group ( “Credit Agricole Affiliate”); |
| • | An issuer of a security for which Amundi US acts as a sponsor, advisor, manager, custodian, distributor, underwriter, broker, or other similar capacity (including those securities specifically declared by its parent Amundi to present a conflict of interest for Amundi US); |
| • | An issuer of a security for which Amundi has informed Amundi US that a Credit Agricole Affiliate acts as a sponsor, advisor, manager, custodian, distributor, underwriter, broker, or other similar capacity; or |
| • | A person with whom Amundi US (or any of its affiliates) has an existing, material contract or business relationship. |
Any member of the Proxy Voting Oversight Group and any other 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 Chief Compliance Officer of Amundi US and the Funds. If any associate is lobbied or pressured with respect to any voting decision, whether within or outside of Amundi US, he or she should contact a member of the Proxy Voting Oversight Group or Amundi US’s Chief Compliance Officer.
The Proxy Voting Oversight Group will review each item referred to Amundi US by the proxy voting service to determine whether an actual or potential conflict of interest 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 voted upon against the Controller’s and 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. The Proxy Voting Oversight Group may cause any of the following actions to be taken when a conflict of interest is present:
| • | Vote the proxy in accordance with the vote indicated under “Voting Guidelines,” if a vote is indicated, or |
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| • | Direct the independent proxy voting service to vote the proxy in accordance with its independent assessment or that of another independent adviser appointed by Amundi US or the applicable client for this purpose. |
If the Proxy Voting Oversight Group perceives a material conflict of interest, the Group may also choose to disclose the conflict to the affected clients and solicit their consent to proceed with the vote or their direction (including through a client’s fiduciary or other adviser), or may take such other action in good faith (in consultation with counsel) that would protect the interests of clients.
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 prepared by the Proxy Coordinator.
The Proxy Voting Oversight Group will review periodically the independence of the proxy voting service. This may include a review of the service’s conflict management procedures and other documentation and an evaluation as to whether the service continues to have the competency and capacity to vote proxies.
Decisions Not to Vote Proxies
Although it is Amundi US’s general policy to vote all proxies in accordance with the principles set forth in this policy, there may be situations in which the Proxy Voting Oversight Group does not vote a proxy referred to it. For example, because of the potential conflict of interest inherent in voting shares of a Credit Agricole Affiliate, Amundi US will abstain from voting the shares unless otherwise directed by a client. In such a case, the Proxy Coordinator will inform Amundi Compliance before exercising voting rights.
There exist other situations in which the Proxy Voting Oversight Group may refrain from voting a proxy. For example, if the cost of voting a foreign security outweighs the benefit of voting, the Group may not vote the proxy. The Group may not be given enough time to process a vote, perhaps because it receives a meeting notice too late or it cannot obtain a translation of the agenda in the time available. If Amundi US has outstanding “sell” orders, the proxies for shares subject to the order may not be voted to facilitate the sale. Although Amundi US may hold shares on a company’s record date, if the shares are sold prior to the meeting date the Group may decide not to vote those shares.
Supervision
Escalation
It is each associate’s responsibility to contact his or her business unit head, the Proxy Coordinator, a member of the Proxy Voting Oversight Group or Amundi US’s Chief Compliance Officer if he or she becomes aware of any possible noncompliance with this policy.
Training
Amundi US will conduct periodic training regarding proxy voting and this policy. It is the responsibility of the business line policy owner and the applicable Compliance Department to coordinate and conduct such training.
Related policies and procedures
Amundi US’s Books and Records Policy and the Books and Records of the Pioneer Funds’ Policy.
Record Keeping
The Proxy Coordinator shall ensure that Amundi US’s proxy voting service:
| • | Retains a copy of each proxy statement received (unless the proxy statement is available from the SEC’s Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system); |
| • | Retains a record of the vote cast; |
| • | Prepares Form N-PX for filing on behalf of each client that is a registered investment company; and |
| • | Is able to promptly provide Amundi US with a copy of the voting record upon its request. |
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:
| • | A record memorializing the basis for each referral vote cast; |
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| • | A copy of any document created by Amundi US that was material in making the decision on how to vote the subject proxy; |
| • | A copy of any recommendation or analysis furnished by the proxy voting service; and |
| • | 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 director or other fiduciaries) regarding the subject proxy vote cast by, or the vote recommendation of, Amundi US. |
Amundi US shall maintain the above records in the client’s file in accordance with applicable regulations.
Related regulations
Form N-1A, Form N-PX, ICA Rule 30b1-4, Rule 31a1-3, Rule 38a-1 and IAA 206(4) -6, Rule 204 -2
Adopted by the Pioneer Funds’ Boards of Directors
October 5, 2004
Effective Date:
October 5, 2004
Revision Dates:
September 2009, December 2015, August 2017, February 2019, and January 2021
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 registrant’s portfolio (“Portfolio Manager”). Also state each Portfolio Manager’s business experience during the past 5 years.
Additional information about the portfolio manager
Other accounts managed by the portfolio manager
The table below indicates, for the 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 April 30, 2024. 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.
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| Name of Portfolio Manager |
Type of Account |
Number of Accounts Managed |
Total Assets Managed (000’s) |
Number of Accounts Managed for which Advisory Fee is Performance- Based |
Assets Managed for which Advisory Fee is Performance- Based (000’s) | |||||||
| John (Jake) Crosby van Roden III |
Other Registered Investment Companies |
6 | $2,432,681 | N/A | N/A | |||||||
| Other Pooled Investment Vehicles | 0 | $0 | N/A | N/A | ||||||||
| Other Accounts | 0 | $0 | N/A | N/A | ||||||||
| Prakash Vadlamani |
Other Registered Investment Companies |
6 | $2,432,681 | N/A | N/A | |||||||
| Other Pooled Investment Vehicles | 0 | $0 | N/A | N/A | ||||||||
| Other Accounts | 0 | $0 | 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, Amundi US 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 Amundi US 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 interest are increased to the extent that a portfolio manager has a financial incentive to favor one account over another. Amundi US has structured its compensation arrangements in a manner that is intended to limit such potential for conflicts of interest. See “Compensation of Portfolio Managers” below.
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| • | 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 Amundi US 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. |
| • | 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, Amundi US will place the order in a manner intended to result in as favorable a price as possible for such client. |
| • | 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 Amundi US 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. |
| • | 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. |
| • | 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, Amundi US 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 manager
Amundi US has adopted a system of compensation for portfolio managers that seeks to align the financial interests of the portfolio managers with those of shareholders of the accounts (including Pioneer funds) the portfolio managers manage, as well as with the financial performance of Amundi US. The compensation program for all Amundi US portfolio managers includes a base salary (determined by the rank and tenure
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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. Amundi US 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 align the interests of the investment professional with those of shareholders, as well as with the financial performance of Amundi US. 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:
| • | Quantitative investment performance. The quantitative investment performance calculation is based on pre-tax investment 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 Bloomberg Barclays Municipal Bond Index and Bloomberg Barclays U.S. Municipal High Yield Bond Index. As a result of these two benchmarks, the performance of the portfolio manager for compensation purposes is measured against the criteria that are relevant to the portfolio manager’s competitive universe. |
| • | 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. |
| • | Amundi US results and business line results. Amundi US’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. |
The quantitative and qualitative performance components comprise 80% and 20%, respectively, of the overall bonus calculation (on a pre-adjustment basis). A portion of the annual bonus is deferred for a specified period and may be invested in one or more Pioneer funds.
Certain portfolio managers participate in other programs designed to reward and retain key contributors. Portfolio managers also may participate in a deferred compensation program, whereby deferred amounts are invested in one or more Pioneer funds or collective investment trusts or other unregistered funds with similar investment objectives, strategies and policies.
Share ownership by portfolio manager
The following table indicates as of April 30, 2024 the value, within the indicated range, of shares beneficially owned by the portfolio manager of the fund.
| Name of Portfolio Manager |
Beneficial Ownership of the Fund* | |
| John (Jake) Crosby van Roden III | A | |
| Prakash Vadlamani | A | |
| * | Key to Dollar Ranges |
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| 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 registrant’s equity securities that is registered by the registrant pursuant to Section 12 of the Exchange Act (15 U.S.C. 781).
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 registrant’s Board of Directors, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-R(17 CFR 229.407)(as required by Item 22(b)(15)) 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 registrant’s Board of Directors since the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-R 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 and principal financials officers, or persons performing similar functions, regarding the effectiveness of the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Act (17 CFR 270.30a-3(c))) as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the Act (17 CFR 270.30(a)-3(b) and Rules 13a-15(b) or 15d-15(b) under the Exchange Act (17 CFR 240.13a-15(b) or 240.15d-15(b)).
The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures are effective based on the evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.
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(b) Disclose any change in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act (17CFR 270.30a-3(d)) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
There were no significant changes in the registrant’s internal control over financial reporting that occurred during 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.
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Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
(a) If the registrant is a closed-end management investment company, provide the following dollar amounts of income and compensation related to the securities lending activities of the registrant during its most recent fiscal year:
N/A
(1) Gross income from securities lending activities;
N/A
(2) All fees and/or compensation for each of the following securities lending activities and related services: any share of revenue generated by the securities lending program paid to the securities lending agent(s) (revenue split); fees paid for cash collateral management services (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not included in the revenue split; administrative fees that are not included in the revenue split; fees for indemnification that are not included in the revenue split; rebates paid to borrowers; and any other fees relating to the securities lending program that are not included in the revenue split, including a description of those other fees;
N/A
(3) The aggregate fees/compensation disclosed pursuant to paragraph (2); and
N/A
(4) Net income from securities lending activities (i.e., the dollar amount in paragraph (1) minus the dollar amount in paragraph (3)).
If a fee for a service is included in the revenue split, state that the fee is included in the revenue split.
N/A
(b) If the registrant is a closed-end management investment company, describe the services provided to the registrant by the securities lending agent in the registrants most recent fiscal year.
N/A
ITEM 13. EXHIBITS.
(a) File the exhibits listed below as part of this Form. Letter or number the exhibits in the sequence indicated.
(3) Not applicable.
(4) Registrant’s Independent Public Accountant, attached as Exhibit 99.ACCT.
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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 Municipal High Income Fund, Inc
By (Signature and Title)* /s/ Lisa M. Jones
Lisa M. Jones, Principal Executive Officer
Date July 8, 2024
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/ Lisa M. Jones
Lisa M. Jones, Principal Executive Officer
Date July 8, 2024
By (Signature and Title)* /s/ Anthony J. Koenig, Jr.
Anthony J. Koenig, Jr., Principal Financial Officer
Date July 8, 2024
| * | Print the name and title of each signing officer under his or her signature. |
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