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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21409
Pioneer Municipal High Income Advantage Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Terrence J. Cullen, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: March 31
Date of reporting period: April 1, 2011 through March 31, 2012
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
Pioneer Municipal High
Income Advantage Trust
--------------------------------------------------------------------------------
Annual Report | March 31, 2012
--------------------------------------------------------------------------------
Ticker Symbol: MAV
[LOGO]PIONEER
Investments(R)
visit us: us.pioneerinvestments.com
Table of Contents
Letter to Shareowners 2
Portfolio Management Discussion 4
Portfolio Summary 9
Prices and Distributions 10
Performance Update 11
Schedule of Investments 12
Financial Statements 23
Notes to Financial Statements 28
Report of Independent Registered Public Accounting Firm 36
Approval of Investment Advisory Agreement 38
Trustees, Officers and Service Providers 42
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 1
President's Letter
Dear Shareowner,
The U.S. economy continued its recovery through the first quarter of 2012, even
as broader global concerns weighed on investors. The U.S. unemployment rate fell
to 8.1% in April, and some indicators suggest that it may continue to trend
down. The housing market continued to improve, fueled in part by record-low
mortgage rates. The risk of rising oil prices appeared to recede. The improved
outlook helped U.S. equity markets to perform well in the first quarter, with
the Standard & Poor's 500 Index rising by 12%. For bond investors, the riskier
sectors of the bond market fared the best. The broad bond market, as measured by
the Barclays Capital Aggregate Bond Index, rose by just 0.3%, while the
high-yield bond market, as measured by the Bank of America Merrill Lynch High
Yield Master II Index, rose by 5.15%.
We are cautiously optimistic that the U.S. economy will continue to improve. But
we are also closely monitoring macroeconomic concerns that could change the
market's direction, such as the lingering debt woes in Europe, the state of the
Chinese economy, and the U.S. government's fiscal situation. Clouds have
continued to hover over Europe, as the exit of Greece from the Euro-zone remains
a possibility. Meanwhile, China continues to face a potential slowdown in
economic growth. In the U.S., tax increases and spending cuts scheduled to take
effect at year-end should, unless fiscal policy changes, sharply reduce the
budget deficit -- which would be very good for the country in the longer run --
but also could potentially stall U.S. economic growth in 2013. All of these
considerations may lead to further market volatility.
At Pioneer, we have long advocated the benefits of staying diversified and
investing for the long term. The strategy has generally performed well for many
investors. Our advice, as always, is to work closely with a trusted financial
advisor to discuss your goals and work together to develop an investment
strategy that meets your individual needs. There is no single best strategy that
works for every investor.
Pioneer's investment professionals focus on finding good opportunities to invest
in both equity and bond markets using the same disciplined investment approach
we have used since 1928. Our strategy is to identify undervalued individual
securities with the greatest potential for success, carefully weighing risk
against reward. Our teams of investment professionals continually
2 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
monitor and analyze the relative valuations of different sectors and securities
globally to help build portfolios that we believe can help you achieve your
investment goals.
We invite you to learn more about Pioneer and our time-tested approach to
investing by consulting with your financial advisor or visiting us online at
us.pioneerinvestments.com. We greatly appreciate your trust in us, and we thank
you for investing with Pioneer.
Sincerely,
/s/Daniel K. Kingsbury
Daniel K. Kingsbury
President and CEO
Pioneer Investment Management USA, Inc.
Any information in this shareowner report regarding market or economic trends or
the factors influencing the Trust's historical or future performance are
statements of opinion as of the date of this report. These statements should not
be relied upon for any other purposes. Past performance is no guarantee of
future results, and there is no guarantee that market forecasts discussed will
be realized.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 3
Portfolio Management Discussion | 3/31/12
Both investment-grade and high-yield municipal bonds turned in solid
performances during the 12 months ended March 31, 2012, as investors gained
confidence that the domestic economy had entered a sustained growth period. In
the following interview, David Eurkus discusses the factors that influenced the
performance of Pioneer Municipal High Income Advantage Trust over the 12-month
period. Mr. Eurkus, senior vice president and portfolio manager at Pioneer, is
responsible for the daily management of the Trust.
Q How did Pioneer Municipal High Income Advantage Trust perform during the
12 months ended March 31, 2012?
A Pioneer Municipal High Income Advantage Trust produced a total return of
23.04% at net asset value, and 28.48% at market price, during the 12-month
period ended March 31, 2012. During the same 12-month period, the Trust's
benchmarks, the Barclays Capital Municipal Bond Index and the Barclays
Capital High Yield Municipal Bond Index, returned 12.07% and 15.48%,
respectively. The Barclays Capital Municipal Bond Index is designed to
track the performance of investment-grade municipal bonds, while the
Barclays Capital High Yield Municipal Bond Index is designed to track the
performance of lower-rated municipal bonds. During the same 12-month
period, the average return (at market price) of the 14 closed end funds in
Lipper's High Yield Municipal Debt Closed End Funds category (which are or
may be leveraged) was 6.79%.
The shares of the Trust were selling at a 14.4% premium to net asset value
at the end of the 12-month period.
Unlike the Trust, the two Barclays Capital municipal bond indices do not
use leverage. While the use of leverage can increase investment
opportunity, it can also increase investment risk.
On March 31, 2012, the standardized 30-day SEC yield on the Trust's shares
was 6.27%.
Q What were the principal factors that affected the Trust's performance
during the 12 months ended March 31, 2012?
A Municipal bonds, both investment-grade and higher-yielding securities,
generated strong results over the 12-month period, and the Trust's healthy
exposure to both groups helped support performance relative to the
Barclays Capital benchmarks. Municipal bond prices were close to cycle
bottoms at the start of the Trust's fiscal year in April 2011, largely due
to short-term market reactions to the well-publicized comments made by one
analyst that had predicted widespread defaults of municipal securities. We
disagreed strongly with those comments at the time, and believed that
there
4 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
were both excellent values and opportunities available for municipal bond
investors who conducted thorough credit research on the underlying
securities. As the Trust's fiscal year began in April 2011, municipal
securities started gaining ground and they continued to perform well for
virtually the entire 12-month period.
Several factors supported the favorable environment for municipals during
the period. First, the supply of new municipal bond issues began shrinking
-- new issuance for 2011 was about 40% lower than in 2010. One of the main
reasons for the contraction in the municipal market during 2011 was the
end of the U.S. government's Build America Bonds (BAB) program on December
31, 2010. As 2010 wound down, the probability that Congress would not
renew the BAB program increased. Realizing this, many municipalities
rushed to get government-subsidized deals done before the expiration of
the BAB program, particularly in October, November and December of 2010,
and the market became flooded with new issues. The late-2010 spike in new
issuance caused 2011's supply of municipals to be pulled forward,
resulting in significantly less new issuance during the 2011 calendar
year. Second, investor demand for tax-advantaged municipal investments was
rising. Traditional buyers started increasing their stakes and
non-traditional municipal investors, such as taxable bond fund managers,
jumped into the market because of the higher yields that municipal
securities offered relative to taxable securities. At the same time, U.S.
economic growth was persisting, albeit modestly, while inflationary
pressures remained subdued and the Federal Reserve System signaled its
intention to keep short-term interest rates at low levels into 2014. With
all of these factors contributing to the favorable backdrop, both
investment-grade and high-yield, lower rated municipals flourished during
the 12-month period, with high-yield debt performing better.
Q How was the Trust's portfolio positioned over the 12 months ended March
31, 2012, and how did the positioning affect the Trust's performance?
A We kept the Trust fully invested during the 12-month period, with solid
exposure to both high-yield and investment-grade municipal bonds. The
Trust's investments in both areas fared very well. In addition, we
maintained a somewhat longer duration in the Trust's portfolio than that
of the Barclays Capital Municipal Bond Index (duration is a measure of
price sensitivity to changes in interest rates). The Trust's duration
positioning also helped relative returns as longer-maturity bonds
outperformed during the 12-month period. We emphasized revenue bonds over
general obligation bonds in the Trust's portfolio. Revenue bonds are
securities that rely on revenues from specific funding sources and that
have their own fees or revenue streams, such as hospital or health care
facilities, higher education institutions or transportation projects. We
focus on these types of securities when selecting investments for the
Trust because of the reliability of their funding sources.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 5
General obligation bonds, on the other hand, do not require a dedicated
stream of revenues and can more easily be affected by credit rating
downgrades or related fiscal problems encountered by state and/or local
governments.
By sector, the Trust's largest allocation was to the hospitals and health
care group, which accounted for 33.1% of the Trust's total investment
portfolio at the end of the fiscal year on March 31, 2012. We also
maintained good Trust exposure to other sectors that we have traditionally
favored, such as transportation (including airports and airport facilities
revenue bonds), which represented 14.1% of the Trust's total investment
portfolio as of March 31, 2012. Education, another sector which we've
traditionally favored, represented 3.6% of the Trust's total investment
portfolio as of March 31, 2012. We generally favor those groups because
they provide essential services and are likely to continue to receive
support, regardless of economic conditions. The Trust's greatest weighting
was in hospitals and health care bonds because within the sectors we saw
attractive values in securities throughout the credit-quality spectrum. We
also saw some interesting opportunities opening up in the sector due to
the new Federal health care regulations.
At the end of the Trust's fiscal year, on March 31, 2012, about 43% of the
Trust's total investment portfolio was invested in high-yield municipal
bonds, with the remaining 57% held in investment-grade debt. We invested
the Trust's portfolio in a total of 159 different securities, issued in 39
different states, territories and the District of Columbia.
Q Did any particular investments have notable effects on the Trust's
performance during the 12 months ended March 31, 2012?
A The Trust enjoyed strong results virtually across the board from
investments in different sectors and with different credit-quality
ratings, with most bond holdings gaining in value amidst the favorable
investment backdrop that prevailed over the 12-month period. The only
serious underperformer during the period was the Trust's holding in an
airport facility security backed by revenues from American Airlines. That
security declined in value when AMR, the parent company of the airline,
filed for bankruptcy at the end of November 2011. However, the Trust's
position was not large and the effect on overall Trust performance was not
notable.
Q How did the level of leverage employed by the Trust change over the
12-month period ended March 31, 2012?
A At the end of the 12-month period, on March 31, 2012, 33.4% of the Trust's
total managed assets were financed by leverage, compared with 36.0% of the
Trust's total managed assets financed by leverage at the start of the
period
6 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
on April 1, 2011. The decrease was due to changes in the values of the
bonds in which the Trust invested.
Q What is your investment outlook?
A The general economic outlook continues to favor investments in municipal
bonds. We believe the global and domestic economies both should maintain
their growth paths, albeit at modest expansion rates. The U.S. economy,
the largest in the world, appears to be strengthening. Inflationary
pressures have remained muted and monetary policy should remain in
pro-growth mode. Nevertheless, we will continue to be alert for any
potential developments that could affect the municipal market. The
European economy, hobbled by the sovereign-credit crises in Greece, Spain
and some other countries, is heading toward recession, while growth in
China has slowed. On the domestic scene, highly partisan political
quarrels have led to stalemate and uncertainty, which has worried many
investors. That said, the potential end of the Bush-era tax cuts next
January still could benefit the municipal market by increasing demand for
tax-advantaged opportunities.
We have a very positive, long-term outlook for the municipal market,
particularly as state and local governments rebalance their budgets. The
trend towards greater fiscal discipline can only benefit the quality of
municipal credits in our opinion. Going forward, we will remain focused on
credit research when selecting investments for the Trust's portfolio,
analyzing both the credit-worthiness of each issuer and the reliability
and sustainability of each security's revenue stream.
Please refer to the Schedule of Investments on pages 12-22 for a full listing of
Trust securities.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 7
Investments in high-yield or lower-rated securities are subject to
greater-than-average risk.
The Trust may invest in securities of issuers that are in default or that are in
bankruptcy.
A portion of income may be subject to state, federal, and/or alternative minimum
tax. Capital gains, if any, are subject to a capital gains tax.
When interest rates rise, the prices of fixed-income securities in the Trust
will generally fall. Conversely, when interest rates fall, the prices of
fixed-income securities in the Trust will generally rise.
By concentrating in municipal securities, the portfolio is more susceptible to
adverse economic, political or regulatory developments than is a portfolio that
invests more broadly.
Investments in the Trust are subject to possible loss due to the financial
failure of the issuers of the underlying securities and the issuers' inability
to meet their debt obligations.
The Trust currently uses leverage through the issuance of preferred shares.
Leverage creates significant risks, including the risk that the Trust's income
or capital appreciation will not be sufficient to cover the cost of leverage,
which may adversely affect the return for the holders of common shares. Since
February of 2008, regularly scheduled auctions for the Trust's preferred shares
have failed and preferred shareowners have not been able to sell their shares at
auction. The Board of Trustees of the Trust has considered, and continues to
consider, this issue.
The Trust is required to maintain certain regulatory and rating agency asset
coverage requirements in connection with its outstanding preferred shares. In
order to maintain required asset coverage levels, the Trust may be required to
alter the composition of its investment portfolio or take other actions, such as
redeeming preferred shares with the proceeds from portfolio transactions, at
what might be inopportune times in the market. Such actions could reduce the net
earnings or returns to holders of the Trust's common shares over time.
Risks of investing in the Trust are discussed in greater detail in the Trust's
original offering documents relating to its common shares and shareowner reports
issued from time to time.
These risks may increase share price volatility.
Past performance is no guarantee of future results, and there is no guarantee
that market forecasts discussed will be realized.
Any information in this shareowner report regarding market or economic trends or
the factors influencing the Trust's historical or future performance are
statements of opinion as of the date of this report. These statements should not
be relied upon for any other purposes.
8 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
Portfolio Summary | 3/31/12
Portfolio Diversification
--------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[THE FOLLOWING DATA IS A REPRESENTATION OF A PIE CHART IN THE PRINTED MATERIAL]
Health Revenue 33.1%
Insured 14.5%
Tobacco Revenue 12.8%
Other Revenue 9.5%
Airport Revenue 7.8%
Development Revenue 5.7%
Education Revenue 3.6%
Pollution Control Revenue 3.6%
Housing Revenue 2.8%
Transportation Revenue 2.3%
Facilities Revenue 2.2%
Water Revenue 1.9%
Airline Revenue 0.2%
Utilities Revenue* 0.0%
* Amount is less than 0.1%
Portfolio Maturity
--------------------------------------------------------------------------------
(As a percentage of long-term holdings)
[THE FOLLOWING DATA IS A REPRESENTATION OF A PIE CHART IN THE PRINTED MATERIAL]
0-2 year 33.0%
2-5 years 7.6%
5-7 years 12.7%
7-10 years 19.9%
10-20 years 14.1%
20+ years 12.7%
Quality Distribution
--------------------------------------------------------------------------------
(As a percentage of total investment portfolio; based on Standard & Poor's
ratings)
[THE FOLLOWING DATA IS A REPRESENTATION OF A PIE CHART IN THE PRINTED MATERIAL]
AAA 3.0%
AA 17.7%
A 8.5%
BBB 18.1%
BB 7.7%
B 8.9%
CCC 0.2%
CC 1.7%
D 0.1%
Not Rated 34.1%
Bond ratings are ordered highest to lowest in portfolio. Based on Standard &
Poor's measures AAA (highest possible rating) through BBB are considered
investment grade; BB or lower ratings are considered non-investment grade. Cash
equivalents and some bonds may not be rated.
The portfolio is actively managed and current holdings may be different.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 9
Prices and Distributions | 3/31/12
Share Prices and Distributions
--------------------------------------------------------------------------------
Market Value per Common Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
3/31/12 3/31/11
--------------------------------------------------------------------------------
$ 14.72 $ 12.64
--------------------------------------------------------------------------------
Premium 14.4% 9.5%
--------------------------------------------------------------------------------
Net Asset Value per Common Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
3/31/12 3/31/11
--------------------------------------------------------------------------------
$ 12.87 $ 11.54
--------------------------------------------------------------------------------
Distributions per Common Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net
Investment Short-Term Long-Term
Income Capital Gains Capital Gains
--------------------------------------------------------------------------------
4/1/11-3/31/12 $ 1.31 $ -- $ --
--------------------------------------------------------------------------------
10 Largest Holdings
--------------------------------------------------------------------------------
(As a percentage of long-term holdings)*
1. New Jersey Economic Development Authority Revenue, 6.25%, 9/15/29 2.95%
2. University of California, RIB, 13.269%, 5/15/32 2.64
3. Massachusetts Housing Finance Agency, 5.35%, 12/1/45 2.44
4. North Texas Tollway Authority Revenue, 5.75%, 1/1/33 2.38
5. Houston Texas Airport System Special Facilities Revenue, 6.75%, 7/1/29 2.27
6. Massachusetts Development Finance Agency, 5.75%, 1/1/42 2.17
7. California State Various Purpose, RIB, 12.996%, 7/28/31 (144A) 2.15
8. Non-Profit Preferred Funding Trust I, 6.75%, 9/15/37 (144A) 2.09
9. Tobacco Settlement Financing Corp., 6.25%, 6/1/42 1.89
10. Connecticut State Development Authority Revenue, 5.75%, 11/1/37 1.76
* This list excludes temporary cash investments. The portfolio is actively
managed, and current holdings may be different. The holdings listed should
not be considered recommendations to buy or sell any security listed.
10 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
Performance Update | 3/31/12
Investment Returns
--------------------------------------------------------------------------------
The mountain chart on the right shows the change in market value, including
reinvestment of dividends and distributions, of a $10,000 investment made in
common shares of Pioneer Municipal High Income Advantage Trust, compared to that
of the Barclays Capital Municipal Bond Index and the Barclays Capital High Yield
Municipal Bond Index.
Average Annual Total Returns
(As of March 31, 2012)
--------------------------------------------------------------------------------
Net Asset Market
Period Value (NAV) Price
--------------------------------------------------------------------------------
Life-of-Trust
(10/17/2003) 6.62% 7.75%
5 Years 2.40 4.28
1 Year 23.04 28.48
--------------------------------------------------------------------------------
[THE FOLLOWING DATA IS A REPRESENTATION OF A MOUNTAIN CHART IN THE PRINTED
MATERIAL]
Market Value of $10,000 Investment
Pioneer Municipal High Barclays Capital Barclays Capital High Yield
Income Advantage Trust Municipal Bond Index Municipal Bond Index
10/31/2003 $10,000 $10,000 $10,000
3/31/2004 $10,293 $10,364 $10,740
3/31/2005 $10,712 $10,641 $11,728
3/31/2006 $11,949 $11,046 $12,796
3/31/2007 $13,169 $11,645 $14,056
3/31/2008 $12,312 $11,867 $13,143
3/31/2009 $8,815 $12,137 $10,625
3/31/2010 $13,906 $13,313 $13,633
3/31/2011 $14,598 $13,530 $14,081
3/31/2012 $18,756 $15,162 $16,261
Call 1-800-225-6292 or visit us.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below NAV due to such factors as interest rate changes
and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
Closed-end funds, unlike open-end funds, are not continuously offered. There is
a one-time public offering and, once issued, shares of closed-end funds are sold
in the open market through a stock exchange, and frequently trade at prices
lower than their NAV. NAV per common share is total assets less total
liabilities, which includes preferred shares, divided by the number of common
shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at
the greater of NAV or 95% of the market price. When NAV is higher, dividends are
assumed to be reinvested at prices obtained under the Trust's dividend
reinvestment plan.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Trust distributions or the sale of Trust shares.
Index comparison begins October 31, 2003. The Barclays Capital Municipal Bond
Index is a broad measure of the municipal bond market. The Barclays Capital High
Yield Municipal Bond Index totals over $26 billion in market value and maintains
over 1300 securities. Municipal bonds in this index have the following
requirements: maturities of one year or greater, sub investment grade (below Baa
or non-rated), fixed coupon rate, issue date later than 12/31/90, deal size over
$20 million, maturity size of at least $3 million. Index returns are calculated
monthly, assume reinvestment of dividends and, unlike Trust returns, do not
reflect any fees, expenses or sales charges. The indices do not employ leverage.
You cannot invest directly in the indices.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 11
Schedule of Investments | 3/31/12
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
TAX-EXEMPT OBLIGATIONS -- 144.1% of Net Assets
Alabama -- 1.5%
$ 2,500,000 B-/B2 Alabama Industrial Development Authority Solid Waste
Disposal Revenue, 6.45%, 12/1/23 $ 2,270,800
2,500,000 NR/NR Huntsville-Redstone Village Special Care Facilities
Financing Authority, 5.5%, 1/1/43 2,133,825
-------------
$ 4,404,625
------------------------------------------------------------------------------------------------------------
Arizona -- 3.4%
5,000,000 NR/NR Casa Grande Industrial Development Authority Hospital
Revenue, 7.625%, 12/1/29 $ 5,155,850
1,492,000 NR/Baa3 Pima County Industrial Development Authority, 6.75%,
7/1/31 1,492,089
2,640,000 NR/NR Pima County Industrial Development Authority, 7.0%,
1/1/38 2,587,200
1,000,000 NR/NR San Luis Facility Development Corp., 7.25%, 5/1/27 921,340
-------------
$ 10,156,479
------------------------------------------------------------------------------------------------------------
California -- 17.4%
6,000,000 CC/NR California County Tobacco Securitization Agency
Revenue, 5.25%, 6/1/46 $ 4,083,240
1,000,000 NR/NR California Enterprise Development Authority Recovery
Zone Facility Revenue, 8.5%, 4/1/31 1,066,030
3,140,000(a) AA-/NR California State University Revenue, RIB, 13.052%,
11/1/39 (144A) 3,694,712
2,425,000 A-/A1 California State Various Purpose, 5.75%, 4/1/31 2,783,973
8,575,000(a) AA-/NR California State Various Purpose, RIB, 12.996%,
6/1/37 (144A) 9,485,065
3,000,000 BB+/NR California Statewide Communities Development
Authority, 7.25%, 10/1/38 (144A) 3,200,310
757,342(b) NR/NR California Statewide Communities Development
Authority, 9.0%, 12/1/38 7,119
2,680,000+ AA+/Aaa Golden State Tobacco Securitization Corp., 6.75%,
6/1/39 2,880,732
2,500,000 NR/Ba1 Hesperia Public Financing Authority, 5.5%, 9/1/27 2,216,375
1,500,000 A-/NR Madera Irrigation Financing Authority Water Revenue,
6.25%, 1/1/31 1,620,150
1,500,000 A-/NR Madera Irrigation Financing Authority Water Revenue,
6.5%, 1/1/40 1,636,950
2,500,000 A-/A2 San Jose California Airport Revenue, 5.0%, 3/1/37 2,557,850
7,000,000 B-/Caa1 Tobacco Securitization Authority of Northern California
Revenue, 5.375%, 6/1/38 5,141,150
10,500,000(a) AA-/NR University of California, RIB, 13.269%, 5/15/38 11,657,100
-------------
$ 52,030,756
------------------------------------------------------------------------------------------------------------
Colorado -- 0.3%
1,000,000 NR/NR Kremmling Memorial Hospital District, 7.125%,
12/1/45 $ 1,059,520
------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
12 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
Connecticut -- 2.9%
$ 7,750,000 BBB/Baa1 Connecticut State Development Authority Revenue,
5.75%, 11/1/37 $ 7,779,682
1,000,000 NR/NR Hamden Connecticut Facility Revenue, 7.75%, 1/1/43 1,051,440
-------------
$ 8,831,122
------------------------------------------------------------------------------------------------------------
District of Columbia -- 3.3%
2,700,000 BBB/Baa1 District of Columbia Tobacco Settlement Financing
Corp., 6.5%, 5/15/33 $ 2,921,346
6,825,000 BBB/Baa1 District of Columbia Tobacco Settlement Financing
Corp., 6.75%, 5/15/40 6,866,496
-------------
$ 9,787,842
------------------------------------------------------------------------------------------------------------
Florida -- 5.0%
1,500,000 NR/NR Alachua County Health Facilities Authority Revenue,
8.125%, 11/15/41 $ 1,538,985
1,500,000 NR/NR Alachua County Health Facilities Authority Revenue,
8.125%, 11/15/46 1,538,985
1,000,000 NR/Ba3 Capital Trust Agency Revenue Bonds, 7.75%, 1/1/41 1,051,980
1,000,000 NR/NR Florida Development Finance Corp., Educational
Facilities Revenue, 6.0%, 9/15/40 1,018,540
2,000,000 NR/NR Florida Development Finance Corp., Educational
Facilities Revenue, 7.625%, 6/15/41 2,120,660
1,000,000 NR/NR Florida Development Finance Corp., Educational
Facilities Revenue, 7.75%, 6/15/42 1,060,440
1,980,000 NR/NR Hillsborough County Industrial Development Authority
Revenue, 6.75%, 7/1/29 1,980,099
1,000,000+ NR/NR Hillsborough County Industrial Development Authority
Revenue, 8.0%, 8/15/32 1,422,520
495,000 NR/NR Miami Beach Health Facilities Authority, 5.375%,
11/15/28 494,980
2,500,000 A-/A2 Miami-Dade County Florida Aviation Revenue,
5.5%, 10/1/41 2,734,225
-------------
$ 14,961,414
------------------------------------------------------------------------------------------------------------
Georgia -- 4.4%
5,210,000(a) AA-/NR Atlanta Georgia Water and Wastewater Revenue,
RIB, 13.052%, 11/1/43 (144A) $ 5,737,096
1,000,000 CCC+/NR Clayton County Development Authority Special
Facilities Revenue, 9.0%, 6/1/35 1,080,200
900,000 NR/NR DeKalb County Georgia Hospital Authority Revenue,
6.0%, 9/1/30 983,160
750,000 NR/NR DeKalb County Georgia Hospital Authority Revenue,
6.125%, 9/1/40 803,640
3,360,000 NR/NR Fulton County Residential Care Facilities, 7.0%, 7/1/29 2,951,390
1,650,000 NR/NR Savannah Georgia Economic Development Authority
Revenue, 7.4%, 1/1/34 1,656,122
-------------
$ 13,211,608
------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 13
Schedule of Investments | 3/31/12 (continued)
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
Guam -- 2.0%
$ 1,000,000 B/NR Guam Government of Department Education
Certificates of Participation, 6.625%, 12/1/30 $ 1,049,380
4,400,000+ AA+/NR Northern Mariana Islands, 6.75%, 10/1/33 4,822,400
-------------
$ 5,871,780
------------------------------------------------------------------------------------------------------------
Idaho -- 1.2%
2,000,000 BBB+/Baa1 Power County Industrial Development Corp., 6.45%,
8/1/32 $ 2,002,360
1,500,000 BBB+/Baa1 Power County Pollution Control Revenue, 5.625%,
10/1/14 1,500,570
-------------
$ 3,502,930
------------------------------------------------------------------------------------------------------------
Illinois -- 6.5%
1,450,000 A+/A1 Illinois Finance Authority Revenue, 5.5%, 4/1/39 $ 1,529,156
2,000,000 AA-/Aa3 Illinois Finance Authority Revenue, 6.0%, 8/15/25 2,114,980
1,000,000(b) NR/NR Illinois Finance Authority Revenue, 6.0%, 11/15/27 499,940
280,000 BBB+/NR Illinois Finance Authority Revenue, 6.0%, 8/15/38 305,057
2,000,000 AA+/Aa2 Illinois Finance Authority Revenue, 6.0%, 8/15/39 2,284,740
2,500,000 NR/NR Illinois Finance Authority Revenue, 6.125%, 11/15/25 2,316,250
6,000,000 NR/NR Illinois Finance Authority Revenue, 8.25%, 5/15/45 6,112,500
2,500,000 NR/NR Illinois Finance Authority Revenue, 8.25%, 2/15/46 2,519,700
2,310,000 NR/NR Southwestern Illinois Development Authority Revenue,
5.625%, 11/1/26 1,728,781
-------------
$ 19,411,104
------------------------------------------------------------------------------------------------------------
Indiana -- 0.4%
250,000 NR/Baa3 East Chicago Indiana Exempt Facilities Revenue,
7.0%, 1/1/14 $ 249,528
1,805,000 NR/NR Vincennes Industrial Economic Development Revenue,
6.25%, 1/1/24 1,089,552
-------------
$ 1,339,080
------------------------------------------------------------------------------------------------------------
Kansas -- 0.3%
1,000,000 NR/A2 Kansas Development Finance Authority, 5.0%,
5/15/35 $ 1,058,880
------------------------------------------------------------------------------------------------------------
Kentucky -- 1.5%
4,390,000 BB/NR Kentucky Economic Development Finance Authority
Hospital System Revenue, 5.875%, 10/1/22 $ 4,389,473
------------------------------------------------------------------------------------------------------------
Louisiana -- 7.0%
5,000,000 BBB-/Baa2 Jefferson Parish Hospital Service Revenue, 6.375%,
7/1/41 $ 5,562,600
2,500,000 BBB-/Baa3 Louisiana Local Government Environmental
Developmental Authority Facilities Revenue, 6.75%,
11/1/32 2,743,450
6,000,000 NR/Baa1 Louisiana Public Facilities Authority Revenue, 5.5%,
5/15/47 6,108,540
The accompanying notes are an integral part of these financial statements.
14 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
Louisiana -- (continued)
$ 750,000 BBB-/NR Opelousas Louisiana General Hospital Authority
Revenue, 5.75%, 10/1/23 $ 771,945
5,915,000 A-/A3 Tobacco Settlement Financing Corp., 5.875%,
5/15/39 5,949,721
-------------
$ 21,136,256
------------------------------------------------------------------------------------------------------------
Maine -- 0.6%
1,500,000 NR/Baa3 Maine Health & Higher Educational Facilities Authority
Revenue, 7.5%, 7/1/32 $ 1,725,675
------------------------------------------------------------------------------------------------------------
Maryland -- 1.6%
460,000 NR/NR Maryland Health & Higher Educational Facilities
Authority Revenue, 5.25%, 1/1/27 $ 408,521
1,250,000 NR/NR Maryland Health & Higher Educational Facilities
Authority Revenue, 5.3%, 1/1/37 1,031,450
1,250,000 NR/Baa3 Maryland Health & Higher Educational Facilities
Authority Revenue, 5.75%, 7/1/38 1,298,950
2,000,000 NR/NR Maryland Health & Higher Educational Facilities
Authority Revenue, 6.25%, 1/1/45 2,218,680
-------------
$ 4,957,601
------------------------------------------------------------------------------------------------------------
Massachusetts -- 9.6%
675,000 BB/NR Massachusetts Development Finance Agency,
5.25%, 10/1/18 $ 674,973
8,000,000 A/NR Massachusetts Development Finance Agency,
5.75%, 1/1/42 9,585,600
1,885,000 NR/NR Massachusetts Development Finance Agency,
7.1%, 7/1/32 1,717,669
2,195,000 BBB-/Baa3 Massachusetts Health & Educational Facilities
Authority Revenue, 5.375%, 7/15/28 2,194,912
2,000,000 AAA/Aaa Massachusetts Health & Educational Facilities
Authority Revenue, 5.5%, 7/1/32 2,736,180
1,000,000 NR/Caa1 Massachusetts Health & Educational Facilities
Authority Revenue, 6.0%, 10/1/23 899,980
3,420,000(b) NR/NR Massachusetts Health & Educational Facilities
Authority Revenue, 6.5%, 1/15/38 33,961
10,760,000 AA-/Aa3 Massachusetts Housing Finance Agency, 5.35%,
12/1/45 10,790,343
-------------
$ 28,633,618
------------------------------------------------------------------------------------------------------------
Michigan -- 1.7%
2,000,000 NR/Ba1 Flint Michigan Hospital Building Authority Revenue,
7.375%, 7/1/35 $ 2,188,940
2,235,000 BB+/NR Kent Hospital Finance Authority Revenue, Metropolitan
Hospital Project Series A, 6.25%, 7/1/40 2,285,734
725,000 NR/NR Michigan Public Educational Facilities Authority
Revenue, 7.0%, 10/1/36 719,128
-------------
$ 5,193,802
------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 15
Schedule of Investments | 3/31/12 (continued)
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
Minnesota -- 0.4%
$ 1,000,000 NR/NR Port Authority of the City of Bloomington, Minnesota
Recovery Zone Facility Revenue, 9.0%, 12/1/35 $ 1,079,890
------------------------------------------------------------------------------------------------------------
Missouri -- 1.4%
1,000,000 NR/NR Kansas City Tax Increment Financing Commission Tax
Increment Revenue, 6.5%, 6/1/25 $ 1,024,380
1,500,000(b)(c) NR/Ca St. Louis Industrial Development Authority Revenue,
7.2%, 12/15/28 600,000
6,640,000(b)(c) NR/Ca St. Louis Industrial Development Authority Revenue,
7.25%, 12/15/35 2,656,000
-------------
$ 4,280,380
------------------------------------------------------------------------------------------------------------
Montana -- 0.7%
2,445,000(d) NR/NR Hardin Increment Industrial Infrastructure Development
Revenue, 0.0%, 9/1/31 $ 1,858,298
1,000,000(b)(c) NR/NR Two Rivers Authority, Inc., Project Revenue, 7.375%,
11/1/27 147,710
-------------
$ 2,006,008
------------------------------------------------------------------------------------------------------------
Nevada-- 1.5%
1,320,000(b)(c) NR/NR Director of the State of Nevada Department of
Business & Industry, 7.375%, 1/1/40 $ 13
1,600,000(b)(c) NR/NR Director of the State of Nevada State Department of
Business & Industry, 7.25%, 1/1/23 16
1,000,000(b)(c) NR/NR Director of the State of Nevada State Department of
Business & Industry, 7.375%, 1/1/30 10
4,500,000 A-/A3 Reno Nevada Hospital Revenue, 5.25%, 6/1/41 4,591,440
-------------
$ 4,591,479
------------------------------------------------------------------------------------------------------------
New Hampshire -- 0.4%
1,125,000 NR/NR New Hampshire Health & Educational Facilities
Authority Revenue, 5.875%, 7/1/34 $ 1,153,102
------------------------------------------------------------------------------------------------------------
New Jersey -- 12.9%
2,500,000 NR/NR Burlington County New Jersey Bridge Commission
Revenue, 5.625%, 1/1/38 $ 2,471,275
13,000,000 B/B3 New Jersey Economic Development Authority Revenue,
6.25%, 9/15/29 13,032,890
3,500,000(a) AA-/NR New Jersey State Turnpike Authority, RIB, 13.722%,
11/1/28 (144A) 5,465,145
15,375,000(h) AA+/Aa1 New Jersey Transportation Trust Fund Authority
Revenue, 0.0%, 12/15/27 7,654,136
1,000,000+ AA+/Aaa Tobacco Settlement Financing Corp., 6.25%, 6/1/43 1,068,060
3,250,000+ AA+/Aaa Tobacco Settlement Financing Corp., 6.75%, 6/1/39 3,490,110
5,000,000+ AA+/Aaa Tobacco Settlement Financing Corp., 7.0%, 6/1/41 5,383,350
-------------
$ 38,564,966
------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
16 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
New York -- 10.7%
$ 1,730,000 NR/NR Dutchess County Industrial Development Agency,
7.5%, 3/1/29 $ 1,761,849
3,000,000 NR/NR Nassau County New York Industrial Development
Agency Revenue, 6.7%, 1/1/43 2,338,050
7,000,000 BB-/B2 New York City Industrial Development Agency, 5.25%,
12/1/32 5,997,880
3,950,000 BB-/B2 New York City Industrial Development Agency, 7.625%,
12/1/32 4,013,714
3,000,000 NR/C New York City Industrial Development Agency, 8.0%,
8/1/12 2,945,910
5,000,000 AAA/Aaa New York State Dormitory Authority Revenue, 5.0%,
10/1/41 5,628,350
2,000,000 NR/Ba1 New York State Dormitory Authority Revenue, 6.125%,
12/1/29 2,098,040
5,000,000 AAA/Aaa New York State Environmental Facilities Corp., 5.0%,
6/15/33 5,200,850
2,000,000 BB/NR Seneca Nation Indians Capital Improvement Authority
Revenue, 5.25%, 12/1/16 (144A) 1,985,160
-------------
$ 31,969,803
------------------------------------------------------------------------------------------------------------
North Carolina -- 1.7%
5,010,000 NR/NR Charlotte North Carolina Special Facilities Revenue,
7.75%, 2/1/28 $ 5,017,665
------------------------------------------------------------------------------------------------------------
Ohio -- 1.8%
1,500,000 NR/NR Adams County Hospital Facilities Revenue,
6.5%, 9/1/36 $ 1,179,180
5,000,000 B-/B3 Buckeye Tobacco Settlement Financing Authority,
6.5%, 6/1/47 4,116,250
-------------
$ 5,295,430
------------------------------------------------------------------------------------------------------------
Oklahoma -- 1.4%
2,220,000(b) NR/NR Tulsa Municipal Airport Trust Revenue, 6.25%, 6/1/20 $ 1,820,578
3,000,000(b)(e) NR/NR Tulsa Municipal Airport Trust Revenue, 7.75%, 6/1/35 2,521,230
-------------
$ 4,341,808
------------------------------------------------------------------------------------------------------------
Oregon -- 0.7%
2,000,000 A-/NR Oregon State Facilities Authority Revenue, 5.25%,
10/1/40 $ 2,119,500
------------------------------------------------------------------------------------------------------------
Pennsylvania -- 5.2%
3,600,000 CC/NR Columbia County Hospital Authority Revenue, 5.85%,
6/1/24 $ 3,580,776
2,000,000 BBB-/Ba1 Pennsylvania Economic Development Financing
Authority Revenue, 4.625%, 12/1/18 1,952,240
1,000,000 BB/NR Pennsylvania Economic Development Financing
Authority Revenue, 5.125%, 6/1/18 979,250
5,000,000 B-/Caa2 Pennsylvania Economic Development Financing
Authority Solid Waste Disposal Revenue, 6.0%, 6/1/31 4,347,200
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 17
Schedule of Investments | 3/31/12 (continued)
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
Pennsylvania -- (continued)
$ 5,000,000 BBB-/Baa3 Philadelphia Hospitals & Higher Education Facilities
Authority Revenue, 5.0%, 7/1/34 $ 4,817,600
-------------
$ 15,677,066
------------------------------------------------------------------------------------------------------------
Rhode Island -- 3.7%
1,385,000(c)(e) NR/NR Central Falls Rhode Island Detention Facilities
Revenue, 7.25%, 7/15/35 $ 1,110,244
1,500,000 NR/NR Rhode Island Health & Educational Building Corp
Revenue, 8.375%, 1/1/46 1,562,835
8,285,000 BB/Ba1 Tobacco Settlement Financing Corp., 6.25%, 6/1/42 8,355,174
-------------
$ 11,028,253
------------------------------------------------------------------------------------------------------------
South Carolina -- 4.8%
7,140,000+ BBB+/Baa1 South Carolina Jobs Economic Development Authority
Revenue, 6.375%, 8/1/34 $ 7,703,132
860,000+ BBB+/Baa1 South Carolina Jobs Economic Development Authority
Revenue, 6.375%, 8/1/34 928,439
4,400,000(f) BBB/NR Tobacco Settlement Revenue Management, 6.375%,
5/15/30 5,914,788
-------------
$ 14,546,359
------------------------------------------------------------------------------------------------------------
Tennessee -- 5.6%
5,000,000 BBB+/Baa1 Johnson City Health & Educational Facilities Board
Hospital Revenue, 6.5%, 7/1/38 $ 5,609,350
1,000,000+ NR/A2 Johnson City Health & Educational Facilities Board
Hospital Revenue, 7.5%, 7/1/33 1,044,150
7,000,000 NR/A1 Knox County Health Educational & Housing Facilities
Board Hospital Revenue, Baptist Health System East
Tennessee, 6.5%, 4/15/31 7,088,340
3,000,000 BBB+/NR Sullivan County Health, Educational & Housing
Facilities Board Hospital Revenue, 5.25%, 9/1/36 3,049,470
-------------
$ 16,791,310
------------------------------------------------------------------------------------------------------------
Texas -- 13.8%
2,400,000 BB+/Ba1 Central Texas Regional Mobility Authority Revenue,
6.75%, 1/1/41 $ 2,568,936
2,663,453(b)(c) NR/NR Gulf Coast Industrial Development Authority, 7.0%,
12/1/36 25,516
10,000,000 B-/B3 Houston Texas Airport System Special Facilities
Revenue, 6.75%, 7/1/29 10,048,600
725,000 NR/NR IAH Public Facility Corp., Project Revenue Bonds,
Series 2006, 6.0%, 5/1/16 693,187
1,000,000 NR/NR IAH Public Facility Corp., Project Revenue Bonds,
Series 2006, 6.0%, 5/1/21 876,010
1,350,000 NR/NR IAH Public Facility Corp., Project Revenue Bonds,
Series 2006, 6.125%, 5/1/26 1,137,280
510,000 AA-/Aa3 Lower Colorado River Authority, 5.0%, 5/15/31 512,927
2,240,000 AA-/Aa3 Lower Colorado River Authority, 5.0%, 5/15/31 2,243,226
The accompanying notes are an integral part of these financial statements.
18 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
Texas -- (continued)
$ 845,000 NR/NR Lubbock Health Facilities Development Corp., 6.5%,
7/1/26 $ 853,104
2,000,000 NR/NR Lubbock Health Facilities Development Corp., 6.625%,
7/1/36 2,000,160
9,750,000 BBB+/A3 North Texas Tollway Authority Revenue, 5.75%,
1/1/33 10,504,162
1,711,000 NR/Aaa Panhandle Regional Housing Finance Corp. Multifamily
Housing Revenue, 6.6%, 7/20/31 1,803,668
1,500,000 NR/NR Red River Health Facilities Development Corp.,
Revenue, 8.0%, 11/15/41 1,545,390
1,000,000 A/Baa2 Richardson Hospital Authority Revenue, 6.0%,
12/1/34 1,027,520
1,000,000 NR/NR Tarrant County Cultural Education Facilities Finance
Corp., 8.125%, 11/15/39 1,027,790
1,500,000 NR/NR Tarrant County Cultural Education Facilities Finance
Corp., 8.25%, 11/15/44 1,544,955
1,000,000(b)(c) D/NR Texas Midwest Public Facility Corp., Revenue, 9.0%,
10/1/30 517,000
2,500,000 NR/NR Travis County Health Facilities Development Corp.
Revenue, 7.125%, 1/1/46 2,415,575
-------------
$ 41,345,006
------------------------------------------------------------------------------------------------------------
Virginia -- 0.8%
2,000,000 BBB+/Baa1 Washington County Industrial Development Authority
Revenue, 7.75%, 7/1/38 $ 2,390,140
------------------------------------------------------------------------------------------------------------
Washington -- 3.6%
1,140,000 BBB/A3 Tobacco Settlement Authority Revenue, 6.5%, 6/1/26 $ 1,187,196
1,500,000 NR/Baa2 Washington State Health Care Facilities Authority,
5.5%, 12/1/39 1,526,775
2,000,000 BBB/Baa2 Washington State Health Care Facilities Authority,
6.125%, 8/15/37 2,113,440
2,000,000 BBB/Baa2 Washington State Health Care Facilities Authority,
6.25%, 8/15/42 2,114,500
5,000,000 NR/NR Washington State Housing Finance Committee
Nonprofit Revenue, 5.625%, 1/1/27 3,741,850
-------------
$ 10,683,761
------------------------------------------------------------------------------------------------------------
West Virginia -- 0.3%
750,000 NR/NR West Virginia Hospital Finance Authority Hospital
Revenue Bonds, 9.125%, 10/1/41 $ 840,487
------------------------------------------------------------------------------------------------------------
Wisconsin -- 2.1%
2,500,000 NR/NR Wisconsin Public Finance Authority Continuing Care
Retirement Community Revenue, 8.25%, 6/1/46 $ 2,676,900
1,000,000 NR/NR Wisconsin State Health & Educational Facilities
Authority Revenue, 6.125%, 4/1/24 1,011,740
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 19
Schedule of Investments | 3/31/12 (continued)
------------------------------------------------------------------------------------------------------------
S&P/Moody's
Principal Ratings
Amount (unaudited) Value
------------------------------------------------------------------------------------------------------------
Wisconsin -- (continued)
$ 1,000,000 NR/NR Wisconsin State Health & Educational Facilities
Authority Revenue, 6.25%, 4/1/34 $ 1,004,740
1,500,000 A+/A1 Wisconsin State Health & Educational Facilities
Authority Revenue, 6.625%, 2/15/39 1,692,270
-------------
$ 6,385,650
------------------------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT OBLIGATIONS
(Cost $405,007,401) $ 431,771,628
------------------------------------------------------------------------------------------------------------
MUNICIPAL COLLATERALIZED DEBT OBLIGATION -- 3.1%
of Net Assets
13,000,000(c)(e) NR/NR Non-Profit Preferred Funding Trust I, 6.75%,
9/15/37 (144A) $ 9,259,250
------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL COLLATERALIZED
DEBT OBLIGATION
(Cost $13,000,000) $ 9,259,250
------------------------------------------------------------------------------------------------------------
Shares
------------------------------------------------------------------------------------------------------------
COMMON STOCK -- 0.4% of Net Assets
TRANSPORTATION -- 0.4%
Airlines -- 0.4%
110,735(g) Delta Air Lines, Inc. $ 1,097,384
------------------------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost $3,210,349) $ 1,097,384
------------------------------------------------------------------------------------------------------------
TAX-EXEMPT MONEY MARKET MUTUAL FUND -- 2.0%
of Net Assets
6,000,000 BlackRock Liquidity Funds MuniFund Portfolio $ 6,000,000
------------------------------------------------------------------------------------------------------------
TOTAL TAX-EXEMPT MONEY MARKET MUTUAL FUND
(Cost $6,000,000) $ 6,000,000
------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS IN SECURITIES -- 149.6%
(Cost $427,217,750) (h)(i) $ 448,128,262
------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES -- 0.5% $ 1,516,700
------------------------------------------------------------------------------------------------------------
PREFERRED SHARES AT REDEMPTION VALUE,
INCLUDING DIVIDENDS PAYABLE -- (50.1)% $(150,007,736)
------------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON
SHAREOWNERS -- 100.0% $ 299,637,226
============================================================================================================
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration. At March
31, 2012, the value of these securities amounted to $38,826,738 or 13.0%
of total net assets applicable to common shareowners.
NR Security not rated by S&P or Moody's
RIB Residual Interest Bonds
The accompanying notes are an integral part of these financial statements.
20 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
+ Prerefunded bonds have been collateralized by U.S. Treasury or U.S.
Government Agency securities which are held in escrow to pay interest and
principal on the tax exempt issue and to retire the bonds in full at the
earliest refunding date.
(a) The interest rate is subject to change periodically and inversely based
upon prevailing market rates. The interest rate shown is the coupon rate
at March 31, 2012.
(b) Security is in default and is non-income producing.
(c) Indicates a security that has been deemed illiquid. The aggregate cost of
illiquid securities is $30,080,659. The aggregate fair value of
$14,315,759 represents 4.8% of the total net assets applicable to common
shareowners.
(d) Debt obligation initially issued at one coupon which converts to a higher
coupon at a specific date. The rate shown is the rate at March 31, 2012.
(e) The interest rate is subject to change periodically. The interest rate
shown is the rate at March 31, 2012.
(f) Escrow to maturity.
(g) Non-income producing.
(h) Security issued with a zero coupon. Income is recognized through accretion
of discount.
(i) The concentration of investments by type of obligation/market sector is as
follows:
Insured:
FSA 8.1%
AMBAC 3.1
BHAC-CR MBIA 1.7
AGM 1.1
Syncora Guarantee 0.5
Revenue Bonds:
Health Revenue 33.2
Tobacco Revenue 12.8
Other Revenue 9.6
Airport Revenue 7.8
Development Revenue 5.7
Education Revenue 3.6
Pollution Control Revenue 3.6
Housing Revenue 2.8
Transportation Revenue 2.3
Facilities Revenue 2.2
Water Revenue 1.9
Utilities Revenue 0.0*
-----
100.0%
=====
* Amount rounds to less than 0.1%
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 21
Schedule of Investments | 3/31/12 (continued)
(i) At March 31, 2012, the net unrealized gain on investments based on cost
for federal income tax purposes of $426,949,767 was as follows:
Aggregate gross unrealized gain in which there is an excess of value over
tax cost $47,430,927
Aggregate gross unrealized loss in which there is an excess of tax cost
over value (26,252,432)
-----------
Net unrealized gain $21,178,495
===========
For financial reporting purposes, net unrealized gain on investments was
$20,910,512 and cost of investments aggregated $427,217,750.
Purchases and sales of securities (excluding temporary cash investments) for the
period ended March 31, 2012 aggregated $63,492,307 and $64,988,494,
respectively.
Various inputs are used in determining the value of the Trust's investments.
These inputs are summarized in the three broad levels listed below.
Level 1 -- 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
risk, etc.)
Level 3 -- significant unobservable inputs (including the Trust's own
assumptions in determining fair value of investments)
Generally, equity securities are categorized as Level 1, fixed income securities
and senior loans are categorized as Level 2 and securities valued using fair
value methods (other than prices supplied by independent pricing services) are
categorized as Level 3. See Notes to Financials Statements -- Note 1A.
The following is a summary of the inputs used as of March 31, 2012, in valuing
the Trust's investments:
Level 1 Level 2 Level 3 Total
Tax-exempt obligations $ -- $431,771,628 $-- $431,771,628
Municipal collateralized debt obligation -- 9,259,250 -- 9,259,250
Common stock 1,097,384 -- -- 1,097,384
Tax-exempt money market mutual fund 6,000,000 -- -- 6,000,000
-------------------------------------------------------------------------------------------------
Total $7,097,384 $441,030,878 $-- $448,128,262
=================================================================================================
The accompanying notes are an integral part of these financial statements.
22 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
Statement of Assets and Liabilities | 3/31/12
ASSETS:
Investments in securities, at value (cost $427,217,750) $448,128,262
Receivables --
Investment securities sold 1,130,115
Interest receivable 8,637,868
Reinvestment of distributions 160,984
Prepaid expenses 48,890
---------------------------------------------------------------------------------
Total assets $458,106,119
---------------------------------------------------------------------------------
LIABILITIES:
Due to custodian $ 7,998,712
Due to affiliates 237,107
Administration fee payable 77,873
Accrued expenses 147,465
---------------------------------------------------------------------------------
Total liabilities $ 8,461,157
---------------------------------------------------------------------------------
PREFERRED SHARES AT REDEMPTION VALUE:
$25,000 liquidation value per share applicable to 6,000 shares,
including dividends payable of $7,736 $150,007,736
---------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Paid-in capital $330,445,184
Undistributed net investment income 9,057,163
Accumulated net realized loss on investments (60,775,633)
Net unrealized gain on investments 20,910,512
---------------------------------------------------------------------------------
Net assets applicable to common shareowners $299,637,226
=================================================================================
NET ASSET VALUE PER COMMON SHARE:
No par value (unlimited number of shares authorized)
Based on $299,637,226 /23,282,302 common shares $ 12.87
=================================================================================
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 23
Statement of Operations
For the Year Ended 3/31/12
INVESTMENT INCOME:
Interest $29,044,561
------------------------------------------------------------------------------------------------
EXPENSES:
Management fees $ 2,626,371
Administrative fees 411,374
Transfer agent fees and expenses 12,600
Shareowner communication expenses 9,516
Auction agent fees 391,457
Custodian fees 14,406
Registration fees 24,645
Professional fees 336,562
Printing expenses 3,246
Trustees' fees 15,440
Pricing fees 35,040
Miscellaneous 36,020
------------------------------------------------------------------------------------------------
Total expenses $ 3,916,677
------------------------------------------------------------------------------------------------
Net investment income $25,127,884
------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss from investments $ (5,391,166)
Change in net unrealized gain from investments 41,794,771
------------------------------------------------------------------------------------------------
Net gain on investments $36,403,605
------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREOWNERS FROM NET
INVESTMENT INCOME: $ (417,488)
------------------------------------------------------------------------------------------------
Net increase in net assets applicable to common shareowners
resulting from operations $61,114,001
================================================================================================
The accompanying notes are an integral part of these financial statements.
24 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
Statement of Changes in Net Assets
----------------------------------------------------------------------------------------
Year Ended Year Ended
3/31/12 3/31/11
----------------------------------------------------------------------------------------
FROM OPERATIONS:
Net investment income $ 25,127,884 $ 27,151,232
Net realized gain (loss) on investments (5,391,166) 632,300
Change in unrealized gain (loss) on investments 41,794,771 (19,037,834)
Distributions to preferred shareowners from net
investment income (417,488) (725,370)
----------------------------------------------------------------------------------------
Net increase in net assets applicable to common
shareowners resulting from operations $ 61,114,001 $ 8,020,328
----------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREOWNERS:
Net investment income ($1.31 and $1.06 per share,
respectively) $(30,307,904) $(24,440,922)
----------------------------------------------------------------------------------------
Total distributions to common shareowners $(30,307,904) $(24,440,922)
----------------------------------------------------------------------------------------
FROM TRUST SHARE TRANSACTIONS:
Reinvestment in distributions $ 1,961,141 $ 1,739,573
----------------------------------------------------------------------------------------
Net increase in net assets applicable to common
shareowners from Trust share transactions $ 1,961,141 $ 1,739,573
----------------------------------------------------------------------------------------
Net increase (decrease) in net assets applicable to
common shareowners $ 32,767,238 $(14,681,021)
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Beginning of year 266,869,988 281,551,009
----------------------------------------------------------------------------------------
End of year $299,637,226 $266,869,988
----------------------------------------------------------------------------------------
Undistributed net investment income $ 9,057,163 $ 14,720,868
----------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 25
Financial Highlights
--------------------------------------------------------------------------------------------------------------------------------
Year Year Year Year Year
Ended Ended Ended Ended Ended
3/31/12 3/31/11 3/31/10 3/31/09 3/31/08
--------------------------------------------------------------------------------------------------------------------------------
Per Common Share Operating Performance
Net asset value, beginning of period $ 11.54 $ 12.24 $ 9.23 $ 13.54 $ 15.91
--------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations:(a)
Net investment income $ 1.08 $ 1.18 $ 1.18 $ 1.22 $ 1.29
Net realized and unrealized gain (loss) on investments and interest
rate swaps 1.58 (0.79) 2.83 (4.43) (2.51)
Distributions to preferred shareowners from:
Net investment income (0.02) (0.03) (0.04) (0.20) (0.26)
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ 2.64 $ 0.36 $ 3.97 $ (3.41) $ (1.48)
Distributions to common shareowners from:
Net investment income (1.31) (1.06) (0.96) (0.90) (0.89)
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ 1.33 $ (0.70) $ 3.01 $ (4.31) $ (2.37)
--------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period(b) $ 12.87 $ 11.54 $ 12.24 $ 9.23 $ 13.54
--------------------------------------------------------------------------------------------------------------------------------
Market value, end of period(b) $ 14.72 $ 12.64 $ 13.10 $ 9.04 $ 13.74
================================================================================================================================
Total return at market value(c) 28.48% 4.97% 57.76% (28.40)% (6.51)%
Ratios to average net assets of common shareowners
Net expenses(d) 1.36% 1.35% 1.41% 1.38% 1.13%
Net investment income before preferred share distributions 8.73% 9.54% 10.66% 10.70% 8.27%
Preferred share distributions 0.15% 0.25% 0.33% 1.76% 1.64%
Net investment income available to common shareowners 8.58% 9.29% 10.33% 8.94% 6.63%
Portfolio turnover 15% 10% 8% 24% 12%
The accompanying notes are an integral part of these financial statements.
26 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
--------------------------------------------------------------------------------------------------------------------------------
Year Year Year Year Year
Ended Ended Ended Ended Ended
3/31/12 3/31/11 3/31/10 3/31/09 3/31/08
--------------------------------------------------------------------------------------------------------------------------------
Net assets of common shareowners, end of period (in thousands) $299,637 $266,870 $281,551 $211,147 $308,500
Preferred shares outstanding (in thousands) $150,000 $150,000 $150,000 $150,000 $150,000
Asset coverage per preferred share, end of period $ 74,941 $ 69,479 $ 71,926 $ 60,192 $ 76,427
Average market value per preferred share(e) $ 25,000 $ 25,000 $ 25,000 $ 25,000 $ 25,000
Liquidation value, including dividends payable, per preferred share $ 25,001 $ 25,001 $ 25,001 $ 25,001 $ 25,010
Ratios to average net assets of common shareowners before waivers and
reimbursements of expenses
Net expenses 1.36% 1.35% 1.41% 1.38% 1.13%
Net investment income before preferred share distribution 8.73% 9.54% 10.66% 10.70% 8.27%
Preferred share distribution 0.15% 0.25% 0.33% 1.76% 1.64%
Net investment income available to common shareowners 8.58% 9.29% 10.33% 8.94% 6.63%
================================================================================================================================
(a) The per common share data presented above is based upon the average common
shares outstanding for the periods presented.
(b) Net asset value and market value are published in Barron's on Saturday,
The Wall Street Journal on Monday and The New York Times on Monday and
Saturday.
(c) Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of the periods reported. Dividends and
distributions, if any, are assumed for purposes of this calculation to be
reinvested at prices obtained under the Trust's dividend reinvestment
plan. Total investment return does not reflect brokerage commissions. Past
performance is not a guarantee of future results.
(d) Expense ratios do not reflect the effect of distribution payments to
preferred shareowners.
(e) Market value is redemption value without an active market.
The information above represents the audited operating performance data for a
share of common stock outstanding, total investment return, ratios to average
net assets of common shareowners and other supplemental data for the periods
indicated. This information has been determined based upon financial information
provided in the financial statements and market value data for the Trust's
common shares.
The accompanying notes are an integral part of these financial statements.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 27
Notes to Financial Statements | 3/31/12
1. Organization and Significant Accounting Policies
Pioneer Municipal High Income Advantage Trust (the Trust) was organized as a
Delaware statutory trust on August 6, 2003. Prior to commencing operations on
October 20, 2003, the Trust had no operations other than matters relating to its
organization and registration as a diversified, closed-end management investment
company under the Investment Company Act of 1940, as amended. The investment
objective of the Trust is to seek a high level of current income exempt from
regular federal income tax, and the Trust may, as a secondary objective, also
seek capital appreciation to the extent that it is consistent with its primary
investment objective.
The Trust's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Trust to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gain or loss on investments during the reporting
year. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements, which are consistent with
those policies generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. Fixed income
securities with remaining maturity of more than sixty days are valued at
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. Valuations may
be supplemented by dealers and other sources, as required. The values of
interest rate swaps are determined by obtaining dealer quotations. Equity
securities that have traded on an exchange are valued at the last sale
price on the principal exchange where they are traded. Equity securities
that have not traded on the date of valuation, or securities for which
sale prices are not available, generally are valued using the mean between
the last bid and asked prices. Short-term fixed income securities with
remaining maturities of sixty days or less generally are valued at
amortized cost. Money market mutual funds are valued at net asset value.
Securities for which independent pricing services 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 using fair value
methods pursuant to
28 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
procedures adopted by the Board of Trustees. The Trust 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 Trust'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 Trust's securities may differ from exchange
prices.
At March 31, 2012, no securities were valued using fair value methods
(other than securities valued using prices supplied by independent pricing
services). 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.
Discount and premium on debt securities are accreted or amortized,
respectively, daily into interest income on a yield-to-maturity basis with
a corresponding increase or decrease in the cost basis of the security.
Interest income, including interest or income bearing cash accounts, is
recorded on an accrual basis.
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have
passed are recorded as soon as the Trust becomes aware of the ex-dividend
data in the exercise of reasonable diligence.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income and net realized capital gains, if
any, to its shareowners. Therefore, no federal income tax provision is
required. Tax years for the prior three fiscal years remain subject to
examination by federal and state tax authorities.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the sources of the Trust's distributions may
be shown in the accompanying financial statements as from or in excess of
net investment income or as from net realized gain (loss) on investment
transactions, or as from paid-in capital, depending on the type of
book/tax differences that may exist.
At March 31, 2012, the Trust reclassified $66,197 to decrease
undistributed net investment income and to decrease net realized loss on
investments to reflect permanent book/tax differences. The
reclassification has no impact
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 29
on the net assets of the Trust and presents the Trust's capital accounts
on a tax basis.
At March 31, 2012, the Trust was permitted to carry forward $36,701 of
short term losses and $2,563,520 of long term losses under the Regulated
Investment Company Modernization Act of 2010 without limitation.
Additionally, at March 31, 2012, the Trust had a net capital loss
carryforward of $53,183,034 of which the following amounts will expire
between 2014 and 2019 if not utilized: $14,156,085 in 2014, $311,368 in
2016, $17,813,537 in 2017, $18,242,633 in 2018 and $2,659,411 in 2019.
Since unlimited losses are required to be utilized prior to losses
incurred in pre-enactment years, pre-enactment capital loss carryforwards
may be more likely to expire unused.
The Trust has elected to defer $6,203,339 of capital losses recognized
between November 1, 2011 and March 31, 2012 to its fiscal year ending
March 31, 2013.
The tax character of distributions paid to common and preferred
shareowners during the years ended March 31, 2012 and March 31, 2011 was
as follows:
--------------------------------------------------------------------------------
2012 2011
--------------------------------------------------------------------------------
Distribution paid from:
Tax exempt income $26,664,988 $24,632,869
Ordinary income 4,060,404 533,423
--------------------------------------------------------------------------------
Total taxable distribution $30,725,392 $25,166,292
================================================================================
The following shows the components of distributable earnings (losses) on a
federal income tax basis at March 31, 2012.
--------------------------------------------------------------------------------
2012
--------------------------------------------------------------------------------
Distributable earnings:
Undistributed tax-exempt income $ 9,047,860
Undistributed ordinary income 960,017
Capital loss carryforward (55,783,255)
Post-October loss deferred (6,203,339)
Dividends payable (7,736)
Unrealized appreciation 21,178,495
--------------------------------------------------------------------------------
Total $(30,807,958)
================================================================================
The difference between book-basis and tax-basis unrealized appreciation is
primarily attributable to the difference between book and tax amortization
methods for premiums and discounts on fixed income securities, the
difference between book and tax accounting for swap agreements, book/tax
difference in accrual of income on securities in default, and other
temporary differences.
30 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
C. Automatic Dividend Reinvestment Plan
All common shareowners 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 common
shares of the Trust in lieu of cash. Shareowners may elect not to
participate in the Plan. Shareowners not participating in the Plan receive
all dividends and capital gain distributions in cash. Participation in the
Plan is completely voluntary and may be terminated or resumed at any time
without penalty by notifying American Stock Transfer & Trust Company, the
agent for shareowners in administering the Plan (the Plan Agent), in
writing prior to any dividend record date; otherwise such termination or
resumption will be effective with respect to any subsequently declared
dividend or other distribution.
If a shareowner's shares are held in the name of a brokerage firm, bank or
other nominee, the shareowner can ask the firm or nominee to participate
in the Plan on the shareowner's behalf. If the firm or nominee does not
offer the Plan, dividends will be paid in cash to the shareowner of
record. A firm or nominee may reinvest a shareowner's cash dividends in
common shares of the Trust on terms that differ from the terms of the
Plan.
Whenever the Trust declares a dividend on common shares payable in cash,
participants in the Plan will receive the equivalent in common shares
acquired by the Plan Agent either (i) through receipt of additional
unissued but authorized common shares from the Trust or (ii) by purchase
of outstanding common shares on the New York Stock Exchange or elsewhere.
If, on the payment date for any dividend, the net asset value per common
share is equal to or less than the market price per share plus estimated
brokerage trading fees (market premium), the Plan Agent will invest the
dividend amount in newly issued common shares. The number of newly issued
common shares to be credited to each account will be determined by
dividing the dollar amount of the dividend by the net asset value per
common share on the date the shares are issued, provided that the maximum
discount from the then current market price per share on the date of
issuance does not exceed 5%. If, on the payment date for any dividend, the
net asset value per common share is greater than the market value (market
discount), the Plan Agent will invest the dividend amount in common shares
acquired in open-market purchases. There are no brokerage charges with
respect to newly issued common shares. However, each participant will pay
a pro rata share of brokerage trading fees incurred with respect to the
Plan Agent's open-market purchases. Participating in the Plan does not
relieve shareowners from any federal, state or local taxes which may be
due on dividends paid in any taxable year. Shareowners holding Plan shares
in a brokerage account may not be able to transfer the shares to another
broker and continue to participate in the Plan.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 31
D. Risks
At times, the Trust's investments may represent industries or industry
sectors that are interrelated or have common risks, making the Trust more
susceptible to any economic, political, or regulatory developments or
other risks affecting those industries and sectors. Information regarding
the Trust's principal risks is contained in the Trust's original offering
prospectus, with additional information included in the Trust's shareowner
reports issued from time to time. Please refer to those documents when
considering the Trust's principal risks.
The Trust may invest in both investment grade and below investment grade
(high-yield) municipal securities with a broad range of maturities and
credit ratings. Debt securities rated below investment grade are commonly
referred to as "junk bonds" and are considered speculative. These
securities involve greater risk of loss, are subject to greater price
volatility, and are less liquid, especially during periods of economic
uncertainty or change, than higher rated debt securities.
2. Management Agreement
Pioneer Investment Management, Inc. (PIM), the Trust's investment adviser, a
wholly owned indirect subsidiary of UniCredit S.p.A. (UniCredit), manages the
Trust's portfolio. Management fees payable under the Trust's Advisory Agreement
with PIM are calculated daily at the annual rate of 0.60% of the Trust's average
daily managed assets. "Managed assets" means (a) the total assets of the Trust,
including any form of investment leverage, minus (b) all accrued liabilities
incurred in the normal course of operations, which shall not include any
liabilities or obligations attributable to investment leverage obtained through
(i) indebtedness of any type (including, without limitation, borrowing through a
credit facility of the issuance of debt securities), (ii) the issuance of
preferred stock or other similar preference securities, and/or (iii) any other
means. For the year ended March 31, 2012, the net management fee was 0.60% of
the Trust's average daily managed assets, which was equivalent to 0.91% of the
Trust's average daily net assets attributable to the common shareowners.
In addition, under PIM's management and administration agreements, certain other
services and costs are paid by PIM and reimbursed by the Trust. At March 31,
2012, $237,107 was payable to PIM related to management costs, administrative
costs and certain other reimbursements and is included in "Due to affiliates" on
the Statement of Assets and Liabilities.
Effective September 1, 2010, PIM has retained State Street Bank and Trust
Company (State Street) to provide certain administrative and accounting services
to the Trust on its behalf. For such services, PIM pays State Street a monthly
fee at an annual rate of 0.07% of the Trust's average daily managed assets up to
$500 million and 0.03% for average daily managed assets in excess
32 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
of $500 million, subject to a minimum monthly fee of $10,000. Previously, PIM
had retained Princeton Administrators, LLC (Princeton) to provide such services.
PIM paid Princeton a monthly fee at an annual rate of 0.07% of the Trust's
average daily managed assets up to $500 million and 0.03% for average daily
managed assets in excess of $500 million, subject to a minimum monthly fee of
$10,000. Neither State Street nor Princeton received compensation directly from
the Trust for providing such services.
3. Transfer Agents
Pioneer Investment Management Shareholder Services, Inc. (PIMSS), a wholly owned
indirect subsidiary of UniCredit, through a sub-transfer agency agreement with
American Stock Transfer & Trust Company, provides substantially all transfer
agent and shareowner services related to the Trust's common shares at negotiated
rates. Deutsche Bank Trust Company Americas (Deutsche Bank) is the transfer
agent, registrar, dividend paying agent and auction agent with respect to the
Trust's Auction Preferred Shares (APS). The Trust pays Deutsche Bank an annual
fee, as is agreed to from time to time by the Trust and Deutsche Bank, for
providing such services.
In addition, the Trust reimburses PIMSS for out-of-pocket expenses incurred by
PIMSS related to shareowner communications activities such as proxy and
statement mailings and outgoing phone calls.
4. Expense Offset Agreements
The Trust has entered into an arrangement with its custodian whereby credits
realized as a result of uninvested cash balances are used to reduce a portion of
the Trust's custodian expenses. For the year ended March 31, 2012, the Trust
expenses were not reduced under such arrangement.
5. Interest Rate Swaps
The Trust may enter into interest rate swap transactions to attempt to protect
itself from increasing dividend or interest expense on its leverage resulting
from increasing short-term interest rates. The cost of leverage may rise with an
increase in interest rates, generally having the effect of lower yields and
potentially lower dividends to common shareowners. Interest rate swaps can be
used to "lock in" the cost of leverage and reduce the negative impact that
rising short-term interest rates would have on the Trust's leveraging costs.
An interest rate swap is an agreement between two parties, which involves
exchanging floating rate and fixed rate interest payments for a specified period
of time. Interest rate swaps involve the accrual of the net interest payments
between the parties on a daily basis, with the net amount recorded within the
unrealized appreciation/depreciation of interest rate swaps on the Statement of
Assets and Liabilities. Once the interim payments are settled in cash, at the
pre-determined dates specified in the agreement, the net amount is recorded as
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 33
realized gain or loss from interest rate swaps on the Statement of Operations.
During the term of the swap, changes in the value of the swap are recognized as
unrealized gains and losses by "marking-to-market" the value of the swap based
on values obtained from dealer quotations. When the swap is terminated, the
Trust will record a realized gain or loss equal to the difference, if any,
between the proceeds from (or cost of) closing the contract and the cost basis
of the contract. The Trust is exposed to credit risk in the event of
non-performance by the other party to the interest rate swap. Risk may also
arise with regard to market movements in the value of the swap arrangement that
do not exactly offset the changes in the related dividend requirement or
interest expense on the Trust's leverage.
There were no interest rate swap contracts open during the year end March 31,
2012 or outstanding at March 31, 2012.
6. Trust Shares
There are an unlimited number of common shares of beneficial interest
authorized.
Transactions in common shares of beneficial interest for the years ended March
31, 2012 and March 31, 2011 were as follows:
--------------------------------------------------------------------------------
3/31/12 3/31/11
--------------------------------------------------------------------------------
Shares outstanding at beginning of year 23,133,791 22,995,047
Reinvestment of distributions 148,511 138,744
--------------------------------------------------------------------------------
Shares outstanding at end of year 23,282,302 23,133,791
================================================================================
The Trust may classify or reclassify any unissued shares of beneficial interest
into one or more series of preferred shares of beneficial interest. As of March
31, 2012, there were 6,000 APS as follows: Series A -- 3,000 and Series B --
3,000.
Dividends on Series A and Series B are cumulative at a rate which is to be reset
every seven days based on the results of an auction. An auction fails if there
are more APS offered for sale than there are buyers. When an auction fails, the
dividend rate for the period will be the maximum rate on the auction dates
described in the prospectus for the APS. Preferred shareowners are not able to
sell their APS at an auction if the auction fails. Since February 2008, the
Trust's auctions related to the APS have failed. The maximum rate for each
series is 125% of the 7 day commercial paper rate or adjusted Kenny rate.
Dividend rates on APS ranged from 0.121% to 0.497% during the year ended March
31, 2012.
The Trust may not declare dividends or make other distributions on its common
shares or purchase any such shares if, at the time of the declaration,
distribution or purchase, the Trust does not comply with the asset coverage
ratios described in the prospectus for the APS.
34 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
The APS are redeemable at the option of the Trust, in whole or in part, on any
dividend payment date at $25,000 per share plus any accumulated or unpaid
dividends, whether or not declared. The APS are also subject to mandatory
redemption at $25,000 per share plus any accumulated or unpaid dividends,
whether or not declared, if certain requirements relating to the composition of
the assets and liabilities of the Trust as set forth in the Statement of
Preferences are not satisfied.
The holders of APS have voting rights equal to the holders of the Trust's common
shares (one vote per share) and will vote together with holders of the common
shares as a single class. Holders of APS are also entitled to elect two of the
Trust's Trustees. In addition, the Investment Company Act of 1940, as amended,
requires that along with approval by shareowners that might otherwise be
required, the approval of the holders of a majority of any outstanding preferred
shares, voting separately as a class, would be required to (a) adopt any plan of
reorganization that would adversely affect the preferred shares and (b) take any
action requiring a vote of security holders, including, among other things,
changes in the Trust's subclassification as a closed-end management investment
company or changes in its fundamental investment restrictions.
7. Subsequent Events
The Board of Trustees of the Trust declared on April 4, 2012 a dividend from
undistributed net investment income of $0.095 per common share payable April 30,
2012, to common shareowners of record on April 16, 2012.
Subsequent to March 31, 2012, dividends declared and paid on preferred shares
totaled $87,510 in aggregate for the two outstanding preferred share series
through May 22, 2012.
On May 2, 2012, Moody's announced that it placed all securities issued by
closed-end funds on review for a possible downgrade as a result of an update of
its rating methodology. If the ratings of the Trust's preferred securities were
downgraded, the Trust's financing costs may increase slightly. A more definite
determination of any potential impact cannot be made at this time.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 35
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and the Shareowners of
Pioneer Municipal High Income Advantage Trust:
--------------------------------------------------------------------------------
We have audited the accompanying statement of assets and liabilities of Pioneer
Municipal High Income Advantage Trust (the "Trust"), including the schedule of
investments, as of March 31, 2012, and the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended and the financial highlights for each of the five
years in the period then ended. These financial statements and financial
highlights are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. We were
not engaged to perform an audit of the Trust's internal control over financial
reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Trust's internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of March 31, 2012, by correspondence with the custodian and
brokers or by other appropriate auditing procedures where replies from brokers
were not received. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Pioneer Municipal High Income Advantage Trust at March 31, 2012, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for each
of the five years in the period then ended, in conformity with U.S. generally
accepted accounting principles.
Ernst + Young LLP
Boston, Massachusetts
May 24, 2012
36 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
ADDITIONAL INFORMATION (unaudited)
During the period, there have been no material changes in the Trust's investment
objective or fundamental policies that have not been approved by the
shareowners. There have been no changes in the Trust's charter or By-Laws that
would delay or prevent a change in control of the Trust which has not been
approved by the shareowners. There have been no changes in the principal risk
factors associated with investment in the Trust. There were no changes in the
persons who are primarily responsible for the day-to-day management of the
Trust's portfolio.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Trust may purchase, from time to time, its common
shares in the open market.
IMPORTANT TAX INFORMATION (unaudited)
The following summarizes the taxable per share distributions paid by Pioneer
Municipal High Income Advantage Trust during the taxable year ended March 31,
2012.
Payable Date Ordinary Income
Common Shareowners 12/29/2011 0.171100
Preferred Shareowners
Series A 1/31/2012 0.800000
2/07/2012 0.870000
2/14/2012 1.400000
2/21/2012 1.690000
2/28/2012 1.790000
3/06/2012 1.500000
3/13/2012 1.290000
3/20/2012 1.290000
3/27/2012 2.380000
4/03/2012* 1.500000
Series B 1/30/2012 0.700000
2/06/2012 0.870000
2/13/2012 1.090000
2/21/2012 1.710000
2/27/2012 1.540000
3/05/2012 1.600000
3/12/2012 1.400000
3/19/2012 1.290000
3/26/2012 1.400000
4/02/2012* 1.600000
4/09/2012* 1.420000
* Subsequent to March 31, 2012.
All the other net investment income distributions paid by the Trust qualify as
tax-exempt interest dividends for federal income tax purposes.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 37
Approval of Investment Advisory Agreement
Pioneer Investment Management, Inc. (PIM) serves as the investment adviser to
Pioneer Municipal High Income Advantage Trust (the Trust) pursuant to an
investment advisory agreement between PIM and the Trust. In order for PIM to
remain the investment adviser of the Trust, the Trustees of the Trust must
determine annually whether to renew the investment advisory agreement for the
Trust.
The contract review process began in March 2011 as the Trustees of the Trust
agreed on, among other things, an overall approach and timeline for the process.
In July 2011, the Trustees approved the format of the contract review materials
and submitted their formal request to PIM to furnish information necessary to
evaluate the terms of the investment advisory agreement. The contract review
materials were provided to the Trustees in July 2011 and September 2011. After
reviewing and discussing the materials, the Trustees submitted a request for
additional information to PIM, and materials were provided in response to this
request. Meetings of the Independent Trustees of the Trust were held in July,
September, October, and November, 2011 to review and discuss the contract review
materials. In addition, the Trustees took into account the information related
to the Trust provided to the Trustees at each regularly scheduled meeting.
At a meeting held on November 29, 2011, based on their evaluation of the
information provided by PIM and third parties, the Trustees of the Trust,
including the Independent Trustees voting separately, unanimously approved the
renewal of the investment advisory agreement for another year. In considering
the renewal of the investment advisory agreement, the Trustees considered
various factors that they determined were relevant, including the factors
described below. The Trustees did not identify any single factor as the
controlling factor in determining to approve the renewal of the agreement.
Nature, Extent and Quality of Services
The Trustees considered the nature, extent and quality of the services that had
been provided by PIM to the Trust, taking into account the investment objective
and strategy of the Trust. The Trustees reviewed the terms of the investment
advisory agreement. The Trustees also reviewed PIM's investment approach for the
Trust, its research process and its process for trade execution. The Trustees
considered the resources of PIM and the personnel of PIM who provide investment
management services to the Trust. The Trustees considered the non-investment
resources and personnel of PIM involved in PIM's services to the Trust,
including PIM's compliance and legal resources and personnel. The Trustees also
considered the substantial attention and high priority given
38 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
by PIM's senior management to the Pioneer fund complex. In addition, the
Trustees considered PIM's plans to increase resources in its investment
management function and other enhancements to PIM's advisory capabilities.
The Trustees considered that PIM supervises and monitors the performance of the
Trust's service providers and provides the Trust with personnel (including Trust
officers) and other resources that are necessary for the Trust's business
management and operations. The Trustees also considered that, as administrator,
PIM is responsible for the administration of the Trust's business and other
affairs. The Trustees considered the fees paid to PIM for the provision of
administration services.
Based on these considerations, the Trustees concluded that the nature, extent
and quality of services that had been provided by PIM to the Trust were
satisfactory and consistent with the terms of the investment advisory agreement.
Performance of the Trust
The Trustees considered the performance results of the Trust over various time
periods. They reviewed information comparing the Trust's performance with the
performance of its peer group of funds as classified by Morningstar, Inc.
(Morningstar), an independent provider of investment company data, and with the
performance of the Trust's benchmark index. The Trustees considered that the
Trust's annualized total return was in the first quintile of its Morningstar
category for the one and three year periods ended June 30, 2011 and in the third
quintile of its Morningstar category for the five year period ended June 30,
2011. (In all quintile rankings referred to throughout this disclosure, first
quintile is most favorable to the Trust's shareowners. Thus, highest relative
performance would be first quintile and lowest relative expenses would also be
first quintile.) The Trustees considered that the Trust's twelve month average
gross portfolio yield (using month end 30 day effective yields) exceeded the
twelve month average yield of the Trust's benchmark index. The Trustees also
reviewed data provided by PIM showing how leverage had benefited the Trust's
common shareholders. The Trustees concluded that the investment performance of
the Trust was satisfactory.
Management Fee and Expenses
The Trustees considered information on the fees and expenses of the Trust in
comparison to the management fees and the expense ratios of a peer group of
funds selected on the basis of criteria determined by the Independent Trustees
for this purpose using data provided by Strategic Insight Mutual Fund Research
and Consulting, LLC (Strategic Insight), an independent third party. The
Trustees considered that the Trust's management fee rate (based on managed
assets) for the twelve months ended June 30, 2011 was in the third quintile
relative to the management fees paid by other funds in its Strategic Insight
peer group for the comparable period. The Trustees also considered that the
Trust's expense ratio (based on managed assets) for the twelve months ended
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 39
June 30, 2011 was in the third quintile relative to its Strategic Insight peer
group for the comparable period.
The Trustees reviewed gross and net management fees charged by PIM to its
institutional and other clients, including publicly offered European funds, U.S.
registered investment companies (in a sub-advisory capacity), and unaffiliated
foreign and domestic separate accounts. The Trustees also considered PIM's costs
in providing services to the Trust and to its other clients and considered the
differences in management fees and profit margins for PIM's Trust and non-Trust
services. In evaluating the fees associated with PIM's client accounts, the
Trustees took into account the respective demands, resources and complexity
associated with the Trust and client accounts. The Trustees noted that in some
instances the fee rates for those clients were lower than the management fee for
the Trust and considered that, under the investment advisory agreement with the
Trust, PIM performs additional services for the Trust that it does not provide
to those other clients or services that are broader in scope, including
oversight of the Trust's other service providers and activities related to
compliance and the extensive regulatory and tax regimes to which the Trust is
subject. The Trustees also considered the different entrepreneurial risks
associated with PIM's management of the Trust and the other client accounts. The
Trustees concluded that the management fee payable by the Trust to PIM was
reasonable in relation to the nature and quality of the services provided by
PIM.
Profitability
The Trustees considered information provided by PIM regarding the profitability
of PIM with respect to the advisory services provided by PIM to the Trust,
including the methodology used by PIM in allocating certain of its costs to the
management of the Trust. The Trustees also considered PIM's profit margin in
connection with the overall operation of the Trust. They further reviewed the
financial results realized by PIM and its affiliates from non-fund businesses.
The Trustees considered PIM's profit margins with respect to the Trust in
comparison to the limited industry data available and noted that the
profitability of any adviser was affected by numerous factors, including its
organizational structure and method for allocating expenses. The Trustees
concluded that PIM's profitability with respect to the management of the Trust
was not unreasonable.
Economies of Scale
The Trustees considered the extent to which PIM may realize economies of scale
or other efficiencies in managing and supporting the Trust. Since the Trust is a
closed-end fund that has not raised additional capital, the Trustees concluded
that economies of scale were not a relevant consideration in the renewal of the
investment advisory agreement.
40 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
Other Benefits
The Trustees considered the other benefits to PIM from its relationship with the
Trust. The Trustees considered the character and amount of fees paid by the
Trust, other than under the investment advisory agreement, for services provided
by PIM and its affiliates. The Trustees further considered the revenues and
profitability of PIM's businesses other than the fund business. The Trustees
considered the intangible benefits to PIM by virtue of its relationship with the
Trust and the other Pioneer funds. The Trustees concluded that the receipt of
these benefits was reasonable in the context of the overall relationship between
PIM and the Trust.
Conclusion
After consideration of the factors described above as well as other factors, the
Trustees, including all of the Independent Trustees, concluded that the
investment advisory agreement between PIM and the Trust, including the fees
payable thereunder, was fair and reasonable and voted to approve the proposed
renewal of the investment advisory agreement for the Trust.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 41
Trustees, Officers and Service Providers
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Independent Registered Public Accounting Firm
Ernst & Young LLP
Legal Counsel
Bingham McCutchen LLP
Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Shareowner Services and Sub-Transfer Agent
American Stock Transfer & Trust Company
Preferred Share Auction/Transfer Agent and Registrar
Deutsche Bank Trust Company Americas
Sub-Administrator
State Street Bank and Company
Proxy Voting Policies and Procedures of the Trust are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Trust voted proxies relating to portfolio securities during
the most recent 12-month period ended June 30 is publicly available to
shareowners at us.pioneerinvestments.com. This information is also available on
the Securities and Exchange Commission's web site at www.sec.gov.
Trustees and Officers
The Trust's Trustees and officers are listed on the following pages, together
with their principal occupations during at least the past five years. Trustees
who are interested persons of the Trust within the meaning of the 1940 Act are
referred to as Interested Trustees. Trustees who are not interested persons of
the Trust are referred to as Independent Trustees. Each of the Trustees, except
Mr. West, serves as a trustee of each of the 56 U.S. registered investment
portfolios for which Pioneer serves as investment adviser (the "Pioneer Funds").
Mr. West serves as a trustee of 44 U.S. registered investment portfolios for
which Pioneer serves as investment adviser. The address for all Trustees and all
officers of the Trust is 60 State Street, Boston, Massachusetts 02109.
The Statement of Additional Information of the Trust includes additional
information about the Trustees and is available, without charge, upon request,
by calling 1-800-225-6292.
42 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
Interested Trustees
--------------------------------------------------------------------------
Position Held Term of Office and
Name and Age With the Trust Length of Service
--------------------------------------------------------------------------
John F. Cogan, Jr. (85)* Chairman of the Class I Trustee since
Board, Trustee 2003. Term expires
and President in 2013. Elected by
Preferred Shares only.
--------------------------------------------------------------------------
Daniel K. Kingsbury (53)* Trustee and Class II Trustee since
Executive Vice 2007. Term expires
President in 2014.
--------------------------------------------------------------------------
Interested Trustees
--------------------------------------------------------------------------------------------------------------------------------
Other Directorships
Name and Age Principal Occupation Held by Trustee
--------------------------------------------------------------------------------------------------------------------------------
John F. Cogan, Jr. (85)* Non-Executive Chairman and a director of Pioneer Investment None
Management USA Inc. ("PIM-USA"); Chairman and a director of
Pioneer; Chairman and Director of Pioneer Institutional Asset
Management, Inc. (since 2006); Director of Pioneer Alternative
Investment Management Limited (Dublin) (until October 2011);
President and a director of Pioneer Alternative Investment Man-
agement (Bermuda) Limited and affiliated funds; Deputy Chair-
man and a director of Pioneer Global Asset Management S.p.A.
("PGAM") (until April 2010); Director of PIOGLOBAL Real Estate
Investment Fund (Russia) (until June 2006); Director of Nano-C,
Inc. (since 2003); Director of Cole Management Inc. (2004 -
2011); Director of Fiduciary Counseling, Inc. (until December
2001); President and Director of Pioneer Funds Distributor, Inc.
("PFD") (until May 2006); President of all of the Pioneer Funds;
and Retired Partner, Wilmer Cutler Pickering Hale and Dorr LLP
--------------------------------------------------------------------------------------------------------------------------------
Daniel K. Kingsbury (53)* Director, CEO and President of PIM-USA (since February 2007); None
Director and President of Pioneer and Pioneer Institutional Asset
Management, Inc. (since February 2007); Executive Vice Presi-
dent of all of the Pioneer Funds (since March 2007); Director of
PGAM (2007 - 2010); Head of New Europe Division, PGAM
(2000 - 2005); and Head of New Markets Division, PGAM
(2005 - 2007)
--------------------------------------------------------------------------------------------------------------------------------
* Mr. Cogan and Mr. Kingsbury are Interested Trustees because they are
officers or directors of the Trust's investment adviser and certain of its
affiliates.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 43
Independent Trustees
--------------------------------------------------------------------------
Position Held Term of Office and
Name and Age With the Trust Length of Service
--------------------------------------------------------------------------
David R. Bock (68) Trustee Class I Trustee since
2005. Term expires
in 2013.
--------------------------------------------------------------------------
Mary K. Bush (63) Trustee Class III Trustee since
2003. Term expires
in 2012.
Independent Trustees
--------------------------------------------------------------------------------------------------------------------------------
Other Directorships
Name and Age Principal Occupation Held by Trustee
--------------------------------------------------------------------------------------------------------------------------------
David R. Bock (68) Managing Partner, Federal City Capital Advisors (corporate advi- Director of Enterprise
sory services company) (1997 - 2004 and 2008 - present); Community Investment, Inc.
Interim Chief Executive Officer, Oxford Analytica, Inc. (privately (privately held affordable
held research and consulting company) (2010); Executive Vice housing finance com- pany)
President and Chief Financial Officer, I-trax, Inc. (publicly (1985 - 2010); Director of
traded health care services company) (2004 - 2007); and Executive Oxford Analytica, Inc. (2008 -
Vice President and Chief Financial Officer, Pedestal Inc. present); Director of The
(internet-based mortgage trading company) (2000 - 2002) Swiss Helvetia Fund, Inc.
(closed-end fund) (2010 -
present); and Director of New
York Mortgage Trust (publicly
traded mortgage REIT) (2004 -
2009, 2012 - present)
--------------------------------------------------------------------------------------------------------------------------------
Mary K. Bush (63) Chairman, Bush International, LLC (international financial advi- Director of Marriott
sory firm) (1991 - present); Senior Managing Director, Brock International, Inc. (2008 -
Capital Group, LLC (strategic business advisors) (2010 - present); Director of Dis-
present); Managing Director, Federal Housing Finance Board cover Financial Services
(oversight of Federal Home Loan Bank system) (1989 - 1991); (credit card issuer and
Vice President and Head of International Finance, Federal electronic payment ser- vices)
National Mortgage Association (1988 - 1989); U.S. Alternate (2007 - present); Former
Executive Director, International Monetary Fund (1984 - 1988); Director of Briggs & Stratton
Executive Assistant to Deputy Secretary of the U.S. Treasury, Co. (engine manufacturer)
U.S. Treasury Department (1982 - 1984); and Vice President (2004 - 2009); Former Director
and Team Leader in Corporate Banking, Bankers Trust Co. of UAL Cor- poration (airline
(1976 - 1982) holding company) (2006 -
2010); Director of ManTech
International Corporation
(national security, defense,
and intelligence technology
firm) (2006 - present);
44 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
--------------------------------------------------------------------------
Position Held Term of Office and
Name and Age With the Trust Length of Service
--------------------------------------------------------------------------
Mary K. Bush (continued)
--------------------------------------------------------------------------
Benjamin M. Friedman (67) Trustee Class II Trustee since
2008. Term expires
in 2011.
--------------------------------------------------------------------------
Margaret B.W. Graham (64) Trustee Class II Trustee since
2003. Term expires
in 2014.
--------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------
Other Directorships
Name and Age Principal Occupation Held by Trustee
--------------------------------------------------------------------------------------------------------------------------------
Mary K. Bush (continued) Member, Board of Governors,
Invest- ment Company Institute
(2007 - present); Member,
Board of Gover- nors,
Independent Directors Council
(2007 - present); Former
Director of Brady Corporation
(2000 - 2007); Former Director
of Mortgage Guar- anty
Insurance Corporation (1991 -
2006); Former Director of
Millen- nium Chemicals, Inc.
(commodity chemicals) (2002 -
2005); Former Director, R.J.
Reynolds Tobacco Holdings,
Inc. (tobacco) (1999 - 2005);
and Former Director of Texaco,
Inc. (1997 - 2001)
--------------------------------------------------------------------------------------------------------------------------------
Benjamin M. Friedman (67) William Joseph Maier Professor of Political Economy, Harvard Trustee, Mellon Institutional
University (1972 - present) Funds Investment Trust and
Mellon Institu- tional Funds
Master Portfolio (over- saw 17
portfolios in fund complex)
(1989 - 2008)
--------------------------------------------------------------------------------------------------------------------------------
Margaret B.W. Graham (64) Founding Director, Vice President and Corporate Secretary, None
The Winthrop Group, Inc. (consulting firm) (1982 - present);
Desautels Faculty of Management, McGill University (1999 -
present); and Manager of Research Operations and Organiza-
tional Learning, Xerox PARC, Xerox's Advance Research Center
(1990 - 1994)
--------------------------------------------------------------------------------------------------------------------------------
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
45
Independent Trustees (continued)
--------------------------------------------------------------------------
Position Held Term of Office and
Name and Age With the Trust Length of Service
--------------------------------------------------------------------------
Thomas J. Perna (61) Trustee Class III Trustee since
2006. Term expires
in 2012.
--------------------------------------------------------------------------
Marguerite A. Piret (63) Trustee Class III Trustee since
2003. Term expires
in 2012. Elected by
Preferred Shares only.
--------------------------------------------------------------------------
Stephen K. West (83) Trustee Class I Trustee since
2003. Term expires
in 2013.
--------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------
Other Directorships
Name and Age Principal Occupation Held by Trustee
--------------------------------------------------------------------------------------------------------------------------------
Thomas J. Perna (61) Chairman and Chief Executive Officer, Quadriserv, Inc. (technol- Director, Broadridge Financial
ogy products for securities lending industry) (2008 - present); Solu- tions, Inc. (investor
private investor (2004 - 2008); and Senior Executive Vice Presi- communications and securities
dent, The Bank of New York (financial and securities services) processing provider for
(1986 - 2004) financial services industry)
(2009 - present); Director,
Quadriserv, Inc. (2005 -
present); and Commis- sioner,
New Jersey State Civil Service
Commission (2011 - present)
--------------------------------------------------------------------------------------------------------------------------------
Marguerite A. Piret (63) President and Chief Executive Officer, Newbury, Piret & Company, Director of New America High
Inc. (investment banking firm) (1981 - present) Income Fund, Inc. (closed-end
investment company) (2004 -
present); and member, Board of
Governors, Investment Company
Institute (2000 - 2006)
--------------------------------------------------------------------------------------------------------------------------------
Stephen K. West (83) Senior Counsel, Sullivan & Cromwell LLP (law firm) (1998 - Director, The Swiss Helvetia
present); and Partner, Sullivan & Cromwell LLP (prior to 1998) Fund, Inc. (closed-end
investment company); and
Director, Invesco, Ltd.
(formerly AMVESCAP, PLC)
(investment manager) (1997 -
2005)
--------------------------------------------------------------------------------------------------------------------------------
46 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
Trust Officers
--------------------------------------------------------------------------
Position Held Length of Service and
Name and Age With the Trust Term of Office
--------------------------------------------------------------------------
Christopher J. Kelley (47) Secretary Since 2010. Serves at
the discretion of the
Board.
--------------------------------------------------------------------------
Carol B. Hannigan (51) Assistant Secretary Since 2010. Serves at
the discretion of the
Board.
--------------------------------------------------------------------------
Thomas Reyes (49) Assistant Secretary Since 2010. Serves at
the discretion of the
Board.
--------------------------------------------------------------------------
Mark E. Bradley (52) Treasurer Since 2008. Serves at
the discretion of the
Board.
--------------------------------------------------------------------------
Luis I. Presutti (47) Assistant Treasurer Since 2003. Serves at
the discretion of the
Board.
--------------------------------------------------------------------------
Gary Sullivan (54) Assistant Treasurer Since 2003. Serves at
the discretion of the
Board.
--------------------------------------------------------------------------
Trust Officers
--------------------------------------------------------------------------------------------------------------------------------
Other Directorships
Name and Age Principal Occupation Held by this Officer
--------------------------------------------------------------------------------------------------------------------------------
Christopher J. Kelley (47) Vice President and Associate General Counsel of Pioneer since None
January 2008 and Secretary of all of the Pioneer Funds since
June 2010; Assistant Secretary of all of the Pioneer Funds from
September 2003 to May 2010; and Vice President and Senior
Counsel of Pioneer from July 2002 to December 2007
--------------------------------------------------------------------------------------------------------------------------------
Carol B. Hannigan (51) Fund Governance Director of Pioneer since December 2006 and None
Assistant Secretary of all the Pioneer Funds since June 2010;
Manager -- Fund Governance of Pioneer from December 2003 to
November 2006; and Senior Paralegal of Pioneer from January
2000 to November 2003
--------------------------------------------------------------------------------------------------------------------------------
Thomas Reyes (49) Counsel of Pioneer since June 2007 and Assistant Secretary of None
all the Pioneer Funds since June 2010; and Vice President and
Counsel at State Street Bank from October 2004 to June 2007
--------------------------------------------------------------------------------------------------------------------------------
Mark E. Bradley (52) Vice President -- Fund Accounting, Administration and Controller- None
ship Services of Pioneer; Treasurer of all of the Pioneer Funds
since March 2008; Deputy Treasurer of Pioneer from March 2004
to February 2008; and Assistant Treasurer of all of the Pioneer
Funds from March 2004 to February 2008
--------------------------------------------------------------------------------------------------------------------------------
Luis I. Presutti (47) Assistant Vice President -- Fund Accounting, Administration and None
Controllership Services of Pioneer; and Assistant Treasurer of all
of the Pioneer Funds
--------------------------------------------------------------------------------------------------------------------------------
Gary Sullivan (54) Fund Accounting Manager -- Fund Accounting, Administration None
and Controllership Services of Pioneer; and Assistant Treasurer of
all of the Pioneer Funds
--------------------------------------------------------------------------------------------------------------------------------
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 47
Trust Officers (continued)
--------------------------------------------------------------------------
Position Held Length of Service and
Name and Age With the Trust Term of Office
--------------------------------------------------------------------------
David F. Johnson (32) Assistant Treasurer Since 2009. Serves at
the discretion of the
Board.
--------------------------------------------------------------------------
Jean M. Bradley (59) Chief Compliance Since 2010. Serves at
Officer the discretion of the
Board.
--------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------------------
Other Directorships
Name and Age Principal Occupation Held by this Officer
--------------------------------------------------------------------------------------------------------------------------------
David F. Johnson (32) Fund Administration Manager -- Fund Accounting, Administration None
and Controllership Services since November 2008; Assistant
Treasurer of all of the Pioneer Funds since January 2009; and
Client Service Manager -- Institutional Investor Services at State
Street Bank from March 2003 to March 2007
--------------------------------------------------------------------------------------------------------------------------------
Jean M. Bradley (59) Chief Compliance Officer of Pioneer and of all the Pioneer Funds None
since March 2010; Director of Adviser and Portfolio Compliance
at Pioneer since October 2005; and Senior Compliance Officer
for Columbia Management Advisers, Inc. from October 2003 to
October 2005
--------------------------------------------------------------------------------------------------------------------------------
48 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
This page for your notes.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 49
This page for your notes.
50 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
This page for your notes.
Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12 51
This page for your notes.
52 Pioneer Municipal High Income Advantage Trust | Annual Report | 3/31/12
How to Contact Pioneer
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
You can call American Stock Transfer & Trust Company (AST) for:
--------------------------------------------------------------------------------
Account Information 1-800-710-0935
Or write to AST:
--------------------------------------------------------------------------------
For Write to
General inquiries, lost dividend checks, American Stock
change of address, lost stock certificates, Transfer & Trust
stock transfer Operations Center
6201 15th Ave.
Brooklyn, NY 11219
Dividend reinvestment plan (DRIP) American Stock
Transfer & Trust
Wall Street Station
P.O. Box 922
New York, NY 10269-0560
Website www.amstock.com
For additional information, please contact your investment advisor or visit our
web site us.pioneerinvestments.com.
The Trust files a complete schedule of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareowners may view the filed Form N-Q by visiting the Commission's
web site at www.sec.gov. The filed form may also be viewed and copied at the
Commission's Public Reference Room in Washington, DC. Information regarding the
operations of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR (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 trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
Audit Fees
Fees for audit services provided to the Trust, including
fees associated with the filings to update its Form N-2
and issuance of comfort letters, totaled approximately
$42,086 in 2012 and $42,086 in 2011.
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
Audit-Related Fees and Other Fees
Audit related fees for the Trust's audit related
services totaled approximately $9,652 and $9,652 in
2012 and 2011, respectively.
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
Tax Fees
Fees for tax compliance services, primarily for tax
returns, totaled approximately $8,290 and $8,290 for
2012 and 2011, 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.
Audit-Related Fees and Other Fees
Audit related fees for the Trust's audit related
services totaled approximately $9,652 and $9,652 in
2012 and 2011, respectively.
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
Non-Audit Services
Beginning with non-audit service contracts entered into
on or after May 6, 2003, the effective date of the new
SEC pre-approval rules, the Trust'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 Trust. For the years ended March 31,
2012 and 2011, there were no services provided to an
affiliate that required the Trust's audit committee pre-
approval.
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
The aggregate non-audit fees for the Trust and affiliates,
as previously defined, totaled approximately $17,942 in
2012 and $17,942 in 2011.
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
The Trust's audit committee of the Board of Trustees has
considered whether the provision of non-audit services
that were rendered to the Affiliates (as defined) that were
not pre-approved pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X is compatible with maintaining
the principal accountant's independence.
Item 5. Audit Committee of Listed Registrants
(a) If the registrant is a listed issuer as defined in Rule 10A-3
under the Exchange Act (17 CFR 240.10A-3), state whether
or not the registrant has a separately-designated standing
audit committee established in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
If the registrant has such a committee, however designated,
identify each committee member. If the entire board of directors
is acting as the registrants audit committee as specified in
Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)),
so state.
The registrant has a separately-designated standing audit
committee established in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
(b) If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act (17 CFR 240.10A-3(d)) regarding an exemption
from the listing standards for audit committees.
N/A
Item 6. Schedule of Investments.
File Schedule I Investments in securities of unaffiliated issuers
as of the close of the reporting period as set forth in 210.12-
12 of Regulation S-X [17 CFR 210.12-12], unless the schedule is
included as part of the report to shareholders filed under Item
1 of this Form.
Included in Item 1
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Proxy Voting Policies and Procedures of
Pioneer Investment Management, Inc.
VERSION DATED July, 2004
Overview
Pioneer Investment Management, Inc. ("Pioneer") is a fiduciary that owes
each of its client's duties of care and loyalty with respect to all
services undertaken on the client's behalf, including proxy voting. When
Pioneer has been delegated proxy-voting authority for a client, the duty of
care requires Pioneer to monitor corporate events and to vote the proxies.
To satisfy its duty of loyalty, Pioneer must place its client's interests
ahead of its own and must cast proxy votes in a manner consistent with the
best interest of its clients. Pioneer will vote all proxies presented in a
timely manner.
The Proxy Voting Policies and Procedures are designed to complement
Pioneer's investment policies and procedures regarding its general
responsibility to monitor the performance and/or corporate events of
companies that are issuers of securities held in accounts managed by
Pioneer. Pioneer's Proxy Voting Policies summarize Pioneer's position on a
number of issues solicited by companies held by Pioneer's clients. The
policies are guidelines that provide a general indication on how Pioneer
would vote but do not include all potential voting scenarios.
Pioneer's Proxy Voting Procedures detail monitoring of voting, exception
votes, and review of conflicts of interest and ensure that case-by-case
votes are handled within the context of the overall guidelines (i.e. best
interest of client). The overriding goal is that all proxies for US and
non-US companies that are received promptly will be voted in accordance
with Pioneer's policies or specific client instructions. All shares in a
company held by Pioneer-managed accounts will be voted alike, unless a
client has given us specific voting instructions on an issue or has not
delegated authority to us or the Proxy Voting Oversight Group determines
that the circumstances justify a different approach.
Pioneer does not delegate the authority to vote proxies relating to its
clients to any of its affiliates, which include other subsidiaries of
UniCredito.
Any questions about these policies and procedures should be directed to the
Proxy Coordinator.
1
Proxy Voting Procedures
Proxy Voting Service
Pioneer has engaged an independent proxy voting service to assist in the
voting of proxies. The proxy voting service works with custodians to ensure
that all proxy materials are received by the custodians and are processed
in a timely fashion. To the extent applicable, the proxy voting service
votes all proxies in accordance with the proxy voting policies established
by Pioneer. The proxy voting service will refer proxy questions to the
Proxy Coordinator (described below) for instructions under circumstances
where: (1) the application of the proxy voting guidelines is unclear; (2) a
particular proxy question is not covered by the guidelines; or (3) the
guidelines call for specific instructions on a case-by-case basis. The
proxy voting service is also requested to call to the Proxy Coordinator's
attention specific proxy questions that, while governed by a guideline,
appear to involve unusual or controversial issues. Pioneer reserves the
right to attend a meeting in person and may do so when it determines that
the company or the matters to be voted on at the meeting are strategically
important to its clients.
Proxy Coordinator
Pioneer's Director of Investment Operations (the "Proxy Coordinator")
coordinates the voting, procedures and reporting of proxies on behalf of
Pioneer's clients. The Proxy Coordinator will deal directly with the proxy
voting service and, in the case of proxy questions referred by the proxy
voting service, will solicit voting recommendations and instructions from
the Director of Portfolio Management US or, to the extent applicable,
investment sub-advisers. The Proxy Coordinator is responsible for ensuring
that these questions and referrals are responded to in a timely fashion and
for transmitting appropriate voting instructions to the proxy voting
service. The Proxy Coordinator is responsible for verifying with the
Compliance Department whether Pioneer's voting power is subject to any
limitations or guidelines issued by the client (or in the case of an
employee benefit plan, the plan's trustee or other fiduciaries).
Referral Items
From time to time, the proxy voting service will refer proxy questions to
the Proxy Coordinator that are described by Pioneer's policy as to be voted
on a case-by-case basis, that are not covered by Pioneer's guidelines or
where Pioneer's guidelines may be unclear with respect to the matter to be
voted on. Under such certain circumstances, the Proxy Coordinator will seek
a written voting recommendation from the Director of Portfolio Management
US. Any such recommendation will include: (i) the manner in which the
proxies should be voted; (ii) the rationale underlying any such decision;
and (iii) the disclosure of any contacts or communications made between
Pioneer and any outside parties concerning the proxy proposal prior to the
time that the voting instructions are provided. In addition, the Proxy
Coordinator will ask the Compliance Department to review the question for
any actual or apparent conflicts of interest as described below under
"Conflicts of
2
Interest." The Compliance Department will provide a "Conflicts of Interest
Report," applying the criteria set forth below under "Conflicts of
Interest," to the Proxy Coordinator summarizing the results of its review.
In the absence of a conflict of interest, the Proxy Coordinator will vote
in accordance with the recommendation of the Director of Portfolio
Management US.
If the matter presents a conflict of interest for Pioneer, then the Proxy
Coordinator will refer the matter to the Proxy Voting Oversight Group for a
decision. In general, when a conflict of interest is present, Pioneer will
vote according to the recommendation of the Director of Portfolio
Management US where such recommendation would go against Pioneer's interest
or where the conflict is deemed to be immaterial. Pioneer will vote
according to the recommendation of its proxy voting service when the
conflict is deemed to be material and the Pioneer's internal vote
recommendation would favor Pioneer's interest, unless a client specifically
requests Pioneer to do otherwise. When making the final determination as to
how to vote a proxy, the Proxy Voting Oversight Group will review the
report from the Director of Portfolio Management US and the Conflicts of
Interest Report issued by the Compliance Department.
Conflicts of Interest
A conflict of interest occurs when Pioneer's interests interfere, or appear
to interfere with the interests of Pioneer's clients. Occasionally, Pioneer
may have a conflict that can affect how its votes proxies. The conflict may
be actual or perceived and may exist when the matter to be voted on
concerns:
o An affiliate of Pioneer, such as another company belonging to
the UniCredito Italiano S.p.A. banking group (a "UniCredito
Affiliate");
o An issuer of a security for which Pioneer acts as a sponsor,
advisor, manager, custodian, distributor, underwriter, broker, or
other similar capacity (including those securities specifically
declared by PGAM to present a conflict of interest for Pioneer);
o An issuer of a security for which UniCredito has informed Pioneer
that a UniCredito Affiliate acts as a sponsor, advisor, manager,
custodian, distributor, underwriter, broker, or other similar
capacity; or
o A person with whom Pioneer (or any of its affiliates) has an
existing, material contract or business relationship that was not
entered into in the ordinary course of Pioneer's business.
o Pioneer will abstain from voting with respect to companies
directly or indirectly owned by UniCredito Italiano Group, unless
otherwise directed by a client. In addition, Pioneer will inform
PGAM Global Compliance and the PGAM Independent Directors before
exercising such rights.
Any associate involved in the proxy voting process with knowledge of any
apparent or actual conflict of interest must disclose such conflict to the
Proxy Coordinator and the Compliance Department. The Compliance Department
will review each item referred to Pioneer to determine whether an actual or
potential conflict of interest with Pioneer exists in connection with the
proposal(s) to be voted upon. The review will be conducted by comparing the
apparent parties affected by the proxy proposal being
3
voted upon against the Compliance Department's internal list of interested
persons and, for any matches found, evaluating the anticipated magnitude
and possible probability of any conflict of interest being present. For
each referral item, the determination regarding the presence or absence of
any actual or potential conflict of interest will be documented in a
Conflicts of Interest Report to the Proxy Coordinator.
Securities Lending
In conjunction with industry standards Proxies are not available to be
voted when the shares are out on loan through either Pioneer's lending
program or a client's managed security lending program. However, Pioneer
will reserve the right to recall lent securities so that they may be voted
according to the Pioneer's instructions. If a portfolio manager would like
to vote a block of previously lent shares, the Proxy Coordinator will work
with the portfolio manager and Investment Operations to recall the
security, to the extent possible, to facilitate the vote on the entire
block of shares.
Share-Blocking
"Share-blocking" is a market practice whereby shares are sent to a
custodian (which may be different than the account custodian) for record
keeping and voting at the general meeting. The shares are unavailable for
sale or delivery until the end of the blocking period (typically the day
after general meeting date).
Pioneer will vote in those countries with "share-blocking." In the event a
manager would like to sell a security with "share-blocking", the Proxy
Coordinator will work with the Portfolio Manager and Investment Operations
Department to recall the shares (as allowable within the market time-frame
and practices) and/or communicate with executing brokerage firm. A list of
countries with "share-blocking" is available from the Investment Operations
Department upon request.
Record Keeping
The Proxy Coordinator shall ensure that Pioneer's proxy voting service:
o Retains a copy of the proxy statement received (unless the proxy
statement is available from the SEC's Electronic Data Gathering,
Analysis, and Retrieval (EDGAR) system);
o Retains a record of the vote cast;
o Prepares Form N-PX for filing on behalf of each client that is a
registered investment company; and
o Is able to promptly provide Pioneer with a copy of the voting
record upon its request.
4
The Proxy Coordinator shall ensure that for those votes that may require
additional documentation (i.e. conflicts of interest, exception votes and
case-by-case votes) the following records are maintained:
o A record memorializing the basis for each referral vote cast;
o A copy of any document created by Pioneer that was material in
making the decision on how to vote the subject proxy; and
o A copy of any conflict notice, conflict consent or any other
written communication (including emails or other electronic
communications) to or from the client (or in the case of an
employee benefit plan, the plan's trustee or other fiduciaries)
regarding the subject proxy vote cast by, or the vote
recommendation of, Pioneer.
o Pioneer shall maintain the above records in the client's file for a
period not less than ten (10) years.
Disclosure
Pioneer shall take reasonable measures to inform its clients of the process
or procedures clients must follow to obtain information regarding how
Pioneer voted with respect to assets held in their accounts. In addition,
Pioneer shall describe to clients its proxy voting policies and procedures
and will furnish a copy of its proxy voting policies and procedures upon
request. This information may be provided to clients through Pioneer's Form
ADV (Part II) disclosure, by separate notice to the client, or through
Pioneer's website.
Proxy Voting Oversight Group
The members of the Proxy Voting Oversight Group are Pioneer's: Director of
Portfolio Management US, Head of Investment Operations, and Director of
Compliance. Other members of Pioneer will be invited to attend meetings and
otherwise participate as necessary. The Head of Investment Operations will
chair the Proxy Voting Oversight Group.
The Proxy Voting Oversight Group is responsible for developing, evaluating,
and changing (when necessary) Pioneer's Proxy Voting Policies and
Procedures. The group meets at least annually to evaluate and review these
policies and procedures and the services of its third-party proxy voting
service. In addition, the Proxy Voting Oversight Group will meet as
necessary to vote on referral items and address other business as
necessary.
Amendments
Pioneer may not amend its Proxy Voting Policies And Procedures without the
prior approval of the Proxy Voting Oversight Group and its corporate
parent, Pioneer Global Asset Management S.p.A
5
Proxy Voting Policies
Pioneer's sole concern in voting proxies is the economic effect of the
proposal on the value of portfolio holdings, considering both the short-
and long-term impact. In many instances, Pioneer believes that supporting
the company's strategy and voting "for" management's proposals builds
portfolio value. In other cases, however, proposals set forth by management
may have a negative effect on that value, while some shareholder proposals
may hold the best prospects for enhancing it. Pioneer monitors developments
in the proxy-voting arena and will revise this policy as needed.
All proxies that are received promptly will be voted in accordance with the
specific policies listed below. All shares in a company held by
Pioneer-managed accounts will be voted alike, unless a client has given us
specific voting instructions on an issue or has not delegated authority to
us. Proxy voting issues will be reviewed by Pioneer's Proxy Voting
Oversight Group, which consists of the Director of Portfolio Management US,
the Director of Investment Operations (the Proxy Coordinator), and the
Director of Compliance.
Pioneer has established Proxy Voting Procedures for identifying and
reviewing conflicts of interest that may arise in the voting of proxies.
Clients may request, at any time, a report on proxy votes for securities
held in their portfolios and Pioneer is happy to discuss our proxy votes
with company management. Pioneer retains a proxy voting service to provide
research on proxy issues and to process proxy votes.
Administrative
While administrative items appear infrequently in U.S. issuer proxies, they
are quite common in non-U.S. proxies.
We will generally support these and similar management proposals:
o Corporate name change.
o A change of corporate headquarters.
o Stock exchange listing.
o Establishment of time and place of annual meeting.
o Adjournment or postponement of annual meeting.
o Acceptance/approval of financial statements.
o Approval of dividend payments, dividend reinvestment plans and other
dividend-related proposals.
o Approval of minutes and other formalities.
6
o Authorization of the transferring of reserves and allocation of
income.
o Amendments to authorized signatories.
o Approval of accounting method changes or change in fiscal year-end.
o Acceptance of labor agreements.
o Appointment of internal auditors.
Pioneer will vote on a case-by-case basis on other routine business;
however, Pioneer will oppose any routine business proposal if insufficient
information is presented in advance to allow Pioneer to judge the merit of
the proposal. Pioneer has also instructed its proxy voting service to
inform Pioneer of its analysis of any administrative items inconsistent, in
its view, with supporting the value of Pioneer portfolio holdings so that
Pioneer may consider and vote on those items on a case-by-case basis.
Auditors
We normally vote for proposals to:
o Ratify the auditors. We will consider a vote against if we are
concerned about the auditors' independence or their past work for
the company. Specifically, we will oppose the ratification of
auditors and withhold votes from audit committee members if
non-audit fees paid by the company to the auditing firm exceed the
sum of audit fees plus audit-related fees plus permissible tax
fees according to the disclosure categories proposed by the
Securities and Exchange Commission.
o Restore shareholder rights to ratify the auditors.
We will normally oppose proposals that require companies to:
o Seek bids from other auditors.
o Rotate auditing firms, except where the rotation is statutorily
required or where rotation would demonstrably strengthen financial
disclosure.
o Indemnify auditors.
o Prohibit auditors from engaging in non-audit services for the
company.
Board of Directors
On issues related to the board of directors, Pioneer normally supports
management. We will, however, consider a vote against management in
instances where corporate performance has been very poor or where the board
appears to lack independence.
7
General Board Issues
Pioneer will vote for:
o Audit, compensation and nominating committees composed of
independent directors exclusively.
o Indemnification for directors for actions taken in good faith in
accordance with the business judgment rule. We will vote against
proposals for broader indemnification.
o Changes in board size that appear to have a legitimate business
purpose and are not primarily for anti-takeover reasons.
o Election of an honorary director.
We will vote against:
o Minimum stock ownership by directors.
o Term limits for directors. Companies benefit from experienced
directors, and shareholder control is better achieved through
annual votes.
o Requirements for union or special interest representation on the
board.
o Requirements to provide two candidates for each board seat.
We will vote on a case-by case basis on these issues:
o Separate chairman and CEO positions. We will consider voting with
shareholders on these issues in cases of poor corporate
performance.
Elections of Directors
In uncontested elections of directors we will vote against:
o Individual directors with absenteeism above 25% without valid
reason. We support proposals that require disclosure of director
attendance.
o Insider directors and affiliated outsiders who sit on the audit,
compensation, stock option or nominating committees. For the
purposes of our policy, we accept the definition of affiliated
directors provided by our proxy voting service.
We will also vote against:
o Directors who have failed to act on a takeover offer where the
majority of shareholders have tendered their shares.
o Directors who appear to lack independence or are associated with
very poor corporate performance.
8
We will vote on a case-by case basis on these issues:
o Re-election of directors who have implemented or renewed a
dead-hand or modified dead-hand poison pill (a "dead-hand poison
pill" is a shareholder rights plan that may be altered only by
incumbent or "dead " directors. These plans prevent a potential
acquirer from disabling a poison pill by obtaining control of the
board through a proxy vote).
o Contested election of directors.
o Prior to phase-in required by SEC, we would consider supporting
election of a majority of independent directors in cases of poor
performance.
o Mandatory retirement policies.
o Directors who have ignored a shareholder proposal that has been
approved by shareholders for two consecutive years.
Takeover-Related Measures
Pioneer is generally opposed to proposals that may discourage takeover
attempts. We believe that the potential for a takeover helps ensure that
corporate performance remains high.
Pioneer will vote for:
o Cumulative voting.
o Increase ability for shareholders to call special meetings.
o Increase ability for shareholders to act by written consent.
o Restrictions on the ability to make greenmail payments.
o Submitting rights plans to shareholder vote.
o Rescinding shareholder rights plans ("poison pills").
o Opting out of the following state takeover statutes:
o Control share acquisition statutes, which deny large holders voting
rights on holdings over a specified threshold.
o Control share cash-out provisions, which require large holders to
acquire shares from other holders.
o Freeze-out provisions, which impose a waiting period on large
holders before they can attempt to gain control.
o Stakeholder laws, which permit directors to consider interests of
non-shareholder constituencies.
9
o Disgorgement provisions, which require acquirers to disgorge profits
on purchases made before gaining control.
o Fair price provisions.
o Authorization of shareholder rights plans.
o Labor protection provisions.
o Mandatory classified boards.
We will vote on a case-by-case basis on the following issues:
o Fair price provisions. We will vote against provisions requiring
supermajority votes to approve takeovers. We will also consider
voting against proposals that require a supermajority vote to
repeal or amend the provision. Finally, we will consider the
mechanism used to determine the fair price; we are generally
opposed to complicated formulas or requirements to pay a premium.
o Opting out of state takeover statutes regarding fair price
provisions. We will use the criteria used for fair price
provisions in general to determine our vote on this issue.
o Proposals that allow shareholders to nominate directors.
We will vote against:
o Classified boards, except in the case of closed-end mutual funds.
o Limiting shareholder ability to remove or appoint directors. We
will support proposals to restore shareholder authority in this
area. We will review on a case-by-case basis proposals that
authorize the board to make interim appointments.
o Classes of shares with unequal voting rights.
o Supermajority vote requirements.
o Severance packages ("golden" and "tin" parachutes). We will support
proposals to put these packages to shareholder vote.
o Reimbursement of dissident proxy solicitation expenses. While we
ordinarily support measures that encourage takeover bids, we
believe that management should have full control over corporate
funds.
o Extension of advance notice requirements for shareholder proposals.
o Granting board authority normally retained by shareholders (e.g.,
amend charter, set board size).
o Shareholder rights plans ("poison pills"). These plans generally
allow shareholders to buy additional shares at a below-market
price in the event of a change in control and may deter some bids.
10
Capital Structure
Managements need considerable flexibility in determining the company's
financial structure, and Pioneer normally supports managements' proposals
in this area. We will, however, reject proposals that impose high barriers
to potential takeovers.
Pioneer will vote for:
o Changes in par value.
o Reverse splits, if accompanied by a reduction in number of shares.
o Share repurchase programs, if all shareholders may participate on
equal terms.
o Bond issuance.
o Increases in "ordinary" preferred stock.
o Proposals to have blank-check common stock placements (other than
shares issued in the normal course of business) submitted for
shareholder approval.
o Cancellation of company treasury shares.
We will vote on a case-by-case basis on the following issues:
o Reverse splits not accompanied by a reduction in number of shares,
considering the risk of delisting.
o Increase in authorized common stock. We will make a determination
considering, among other factors:
o Number of shares currently available for issuance;
o Size of requested increase (we would normally approve increases of up to
100% of current authorization);
o Proposed use of the additional shares; and
o Potential consequences of a failure to increase the number of shares
outstanding (e.g., delisting or bankruptcy).
o Blank-check preferred. We will normally oppose issuance of a new
class of blank-check preferred, but may approve an increase in a
class already outstanding if the company has demonstrated that it
uses this flexibility appropriately.
o Proposals to submit private placements to shareholder vote.
o Other financing plans.
We will vote against preemptive rights that we believe limit a company's
financing flexibility.
11
Compensation
Pioneer supports compensation plans that link pay to shareholder returns
and believes that management has the best understanding of the level of
compensation needed to attract and retain qualified people. At the same
time, stock-related compensation plans have a significant economic impact
and a direct effect on the balance sheet. Therefore, while we do not want
to micromanage a company's compensation programs, we will place limits on
the potential dilution these plans may impose.
Pioneer will vote for:
o 401(k) benefit plans.
o Employee stock ownership plans (ESOPs), as long as shares
allocated to ESOPs are less than 5% of outstanding shares. Larger
blocks of stock in ESOPs can serve as a takeover defense. We will
support proposals to submit ESOPs to shareholder vote.
o Various issues related to the Omnibus Budget and Reconciliation Act
of 1993 (OBRA), including:
o Amendments to performance plans to conform with OBRA;
o Caps on annual grants or amendments of administrative features;
o Adding performance goals; and
o Cash or cash-and-stock bonus plans.
o Establish a process to link pay, including stock-option grants, to
performance, leaving specifics of implementation to the company.
o Require that option repricings be submitted to shareholders.
o Require the expensing of stock-option awards.
o Require reporting of executive retirement benefits (deferred
compensation, split-dollar life insurance, SERPs, and pension
benefits).
o Employee stock purchase plans where the purchase price is equal to
at least 85% of the market price, where the offering period is no
greater than 27 months and where potential dilution (as defined
below) is no greater than 10%.
12
We will vote on a case-by-case basis on the following issues:
o Executive and director stock-related compensation plans. We will
consider the following factors when reviewing these plans:
o The program must be of a reasonable size. We will approve plans
where the combined employee and director plans together would
generate less than 15% dilution. We will reject plans with 15% or
more potential dilution.
Dilution = (A + B + C) / (A + B + C + D), where
A = Shares reserved for plan/amendment,
B = Shares available under continuing plans,
C = Shares granted but unexercised and
D = Shares outstanding.
o The plan must not:
o Explicitly permit unlimited option repricing authority or that
have repriced in the past without shareholder approval.
o Be a self-replenishing "evergreen" plan, plans that grant
discount options and tax offset payments.
o We are generally in favor of proposals that increase participation beyond
executives.
o We generally support proposals asking companies to adopt rigorous
vesting provisions for stock option plans such as those that vest
incrementally over, at least, a three- or four-year period with a pro
rata portion of the shares becoming exercisable on an annual basis
following grant date.
o We generally support proposals asking companies to disclose their
window period policies for stock transactions. Window period policies
ensure that employees do not exercise options based on insider
information contemporaneous with quarterly earnings releases and other
material corporate announcements.
o We generally support proposals asking companies to adopt stock holding
periods for their executives.
o All other employee stock purchase plans.
o All other compensation-related proposals, including deferred
compensation plans, employment agreements, loan guarantee programs
and retirement plans.
o All other proposals regarding stock compensation plans, including
extending the life of a plan, changing vesting restrictions,
repricing options, lengthening exercise periods or accelerating
distribution of awards and pyramiding and cashless exercise
programs.
13
We will vote against:
o Pensions for non-employee directors. We believe these retirement
plans reduce director objectivity.
o Elimination of stock option plans.
We will vote on a case-by case basis on these issues:
o Limits on executive and director pay.
o Stock in lieu of cash compensation for directors.
Corporate Governance
Pioneer will vote for:
o Confidential Voting.
o Equal access provisions, which allow shareholders to contribute
their opinion to proxy materials.
o Proposals requiring directors to disclose their ownership of shares
in the company.
We will vote on a case-by-case basis on the following issues:
o Change in the state of incorporation. We will support
reincorporations supported by valid business reasons. We will
oppose those that appear to be solely for the purpose of
strengthening takeover defenses.
o Bundled proposals. We will evaluate the overall impact of the
proposal.
o Adopting or amending the charter, bylaws or articles of association.
o Shareholder appraisal rights, which allow shareholders to demand
judicial review of an acquisition price.
We will vote against:
o Shareholder advisory committees. While management should solicit
shareholder input, we prefer to leave the method of doing so to
management's discretion.
o Limitations on stock ownership or voting rights.
o Reduction in share ownership disclosure guidelines.
14
Mergers and Restructurings
Pioneer will vote on the following and similar issues on a case-by-case
basis:
o Mergers and acquisitions.
o Corporate restructurings, including spin-offs, liquidations, asset
sales, joint ventures, conversions to holding company and
conversions to self-managed REIT structure.
o Debt restructurings.
o Conversion of securities.
o Issuance of shares to facilitate a merger.
o Private placements, warrants, convertible debentures.
o Proposals requiring management to inform shareholders of merger
opportunities.
We will normally vote against shareholder proposals requiring that the
company be put up for sale.
Mutual Funds
Many of our portfolios may invest in shares of closed-end mutual funds or
exchange-traded funds. The non-corporate structure of these investments
raises several unique proxy voting issues.
Pioneer will vote for:
o Establishment of new classes or series of shares.
o Establishment of a master-feeder structure.
Pioneer will vote on a case-by-case on:
o Changes in investment policy. We will normally support changes
that do not affect the investment objective or overall risk level
of the fund. We will examine more fundamental changes on a
case-by-case basis.
o Approval of new or amended advisory contracts.
o Changes from closed-end to open-end format.
o Authorization for, or increase in, preferred shares.
o Disposition of assets, termination, liquidation, or mergers.
o Classified boards of closed-end mutual funds, but will typically
support such proposals.
15
Social Issues
Pioneer will abstain on stockholder proposals calling for greater
disclosure of corporate activities with regard to social issues. "Social
Issues" may generally be described as shareholder proposals for a company
to:
o Conduct studies regarding certain issues of public concern and
interest;
o Study the feasibility of the company taking certain actions with
regard to such issues; or
o Take specific action, including ceasing certain behavior and
adopting company standards and principles, in relation to issues
of public concern and interest.
We believe these issues are important and should receive management
attention.
Pioneer will vote against proposals calling for substantial changes in the
company's business or activities. We will also normally vote against
proposals with regard to contributions, believing that management should
control the routine disbursement of funds.
16
Item 8. Portfolio Managers of Closed-End Management Investment
Companies.
(a) If the registrant is a closed-end management investment company that
is filing an annual report on this Form N-CSR,provide the following
information:
(1) State the name, title, and length of service of the person or persons
employed by or associated with the registrant or an investment adviser
of the registrant who are primarily responsible for the day-to-day management
of the registrants portfolio (Portfolio Manager). Also state each Portfolio
Managers business experience during the past 5 years.
MUNICIPAL HIGH INCOME ADVANTAGE TRUST
-------------------------------------
PORTFOLIO MANAGEMENT
ADDITIONAL INFORMATION ABOUT THE PORTFOLIO MANAGERS
OTHER ACCOUNTS MANAGED BY THE PORTFOLIO MANAGERS. The table below indicates,
for each portfolio manager of the fund, information about the accounts other
than the fund over which the portfolio manager has day-to-day investment
responsibility. All information on the number of accounts and total assets in
the table is as of March 31, 2012. For purposes of the table, "Other Pooled
Investment Vehicles" may include investment partnerships, undertakings for
collective investments in transferable securities ("UCITS") and other non-U.S.
investment funds and group trusts, and "Other Accounts" may include separate
accounts for institutions or individuals, insurance company general or separate
accounts, pension funds and other similar institutional accounts but generally
do not include the portfolio manager's personal investment accounts or those
which the manager may be deemed to own beneficially under the code of ethics.
Certain funds and other accounts managed by the portfolio manager may have
substantially similar investment strategies.
NAME OF PORTFOLIO MANAGER TYPE OF ACCOUNT NUMBER OF ACCOUNTS MANAGED
------------------------- --------------- --------------------------
TOTAL ASSETS MANAGED NUMBER OF ACCOUNTS MANAGED FOR WHICH ADVISORY FEE IS
-------------------- ----------------------------------------------------
PERFORMANCE-BASED ASSETS MANAGED FOR WHICH ADVISORY FEE IS PERFORMANCE-BASED
----------------- ----------------------------------------------------------
David Eurkus
------------
Other Registered Investment Companies 3 $2,043,017,000 N/A
------------------------------------- - -------------- ---
N/A
---
Other Pooled Investment Vehicles 0 $0 N/A N/A
-------------------------------- - -- --- ---
Other Accounts 1 $9,647,000 N/A N/A
-------------- - ----------- --- ---
POTENTIAL CONFLICTS OF INTEREST. When a portfolio manager is responsible for
the management of more than one account, the potential arises for the portfolio
manager to favor one account over another. The principal types of potential
conflicts of interest that may arise are discussed below. For the reasons
outlined below, Pioneer does not believe that any material conflicts are likely
to arise out of a portfolio manager's responsibility for the management of the
fund as well as one or more other accounts. Although Pioneer has adopted
procedures that it believes are reasonably designed to detect and prevent
violations of the federal securities laws and to mitigate the potential for
conflicts of interest to affect its portfolio management decisions, there can be
no assurance that all conflicts will be identified or that all procedures will
be effective in mitigating the potential for such risks. Generally, the risks of
such conflicts of interest are increased to the extent that a portfolio manager
has a financial incentive to favor one account over another. Pioneer has
structured its compensation arrangements in a manner that is intended to limit
such potential for conflicts of interest. See "Compensation of Portfolio
Managers" below.
- A portfolio manager could favor one account over another in allocating new
investment opportunities that have limited supply, such as initial public
offerings and private placements. If, for example, an initial public offering
that was expected to appreciate in value significantly shortly after the
offering was allocated to a single account, that account may be expected to have
better investment performance than other accounts that did not receive an
allocation of the initial public offering. Generally, investments for which
there is limited availability are allocated based upon a range of factors
including available cash and consistency with the accounts' investment
objectives and policies. This allocation methodology necessarily involves some
subjective elements but is intended over time to treat each client in an
equitable and fair manner. Generally, the investment opportunity is allocated
among participating accounts on a pro rata basis. Although Pioneer believes
that its practices are reasonably designed to treat each client in an equitable
and fair manner, there may be instances where a fund may not participate, or may
participate to a lesser degree than other clients, in the allocation of an
investment opportunity.
- A portfolio manager could favor one account over another in the order in
which trades for the accounts are placed. If a portfolio manager determines to
purchase a security for more than one account in an aggregate amount that may
influence the market price of the security, accounts that purchased or sold the
security first may receive a more favorable price than accounts that made
subsequent transactions. The less liquid the market for the security or the
greater the percentage that the proposed aggregate purchases or sales represent
of average daily trading volume, the greater the potential for accounts that
make subsequent purchases or sales to receive a less favorable price. When a
portfolio manager intends to trade the same security on the same day for more
than one account, the trades typically are "bunched," which means that the
trades for the individual accounts are aggregated and each account receives the
same price. There are some types of accounts as to which bunching may not be
possible for contractual reasons (such as directed brokerage arrangements).
Circumstances may also arise where the trader believes that bunching the orders
may not result in the best possible price. Where those accounts or circumstances
are involved, Pioneer will place the order in a manner intended to result in as
favorable a price as possible for such client.
- A portfolio manager could favor an account if the portfolio manager's
compensation is tied to the performance of that account to a greater degree than
other accounts managed by the portfolio manager. If, for example, the portfolio
manager receives a bonus based upon the performance of certain accounts relative
to a benchmark while other accounts are disregarded for this purpose, the
portfolio manager will have a financial incentive to seek to have the accounts
that determine the portfolio manager's bonus achieve the best possible
performance to the possible detriment of other accounts. Similarly, if Pioneer
receives a performance-based advisory fee, the portfolio manager may favor that
account, whether or not the performance of that account directly determines the
portfolio manager's compensation.
- 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, Pioneer seeks to avoid such potentially conflicting situations.
However, where a portfolio manager is responsible for accounts with differing
investment objectives and policies, it is possible that the portfolio manager
will conclude that it is in the best interest of one account to sell a portfolio
security while another account continues to hold or increase the holding in such
security.
COMPENSATION OF PORTFOLIO MANAGERS. Pioneer has adopted a system of
compensation for portfolio managers 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 Pioneer. The compensation program for all Pioneer portfolio
managers includes a base salary (determined by the rank and tenure of the
employee) and an annual bonus program, as well as customary benefits that are
offered generally to all full-time employees. Base compensation is fixed and
normally reevaluated on an annual basis. Pioneer seeks to set base compensation
at market rates, taking into account the experience and responsibilities of the
portfolio manager. The bonus plan is intended to provide a competitive level of
annual bonus compensation that is tied to the portfolio manager achieving
superior investment performance and align the interests of the investment
professional with those of shareholders, as well as with the financial
performance of Pioneer. 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, are the Barclays Capital Municipal Bond Index and the Barclays Capital
High Income Municipal 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.
- Pioneer Results and Business Line Results. Pioneer's financial
performance, as well as the investment performance of its investment management
group, affect a portfolio manager's actual bonus by a leverage factor of plus or
minus (+/-) a predetermined percentage.
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 may participate in other programs designed to reward
and retain key contributors. Senior executives or other key employees may be
granted performance units based on the stock price performance of UniCredit and
the financial performance of Pioneer Global Asset Management S.p.A., which are
affiliates of Pioneer. Portfolio managers also may participate in a deferred
compensation program, whereby deferred amounts are invested in one or more
Pioneer funds.
SHARE OWNERSHIP BY PORTFOLIO MANAGER. The following table indicates as of March
31, 2012 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*
------------------------- ---------------------------------
David Eurkus A
------------ -
*Key to Dollar Ranges
A. None
B. $1 - $10,000
C. $10,001 - $50,000
D. $50,001 - $100,000
E. $100,001 - $500,000
F. $500,001 - $1,000,000
G. Over $1,000,000
Item 9. Purchases of Equity Securities by Closed-End Management
Investment Company and Affiliated Purchasers.
(a) If the registrant is a closed-end management investment company,
in the following tabular format, provide the information specified in
paragraph (b) of this Item with respect to any purchase made by or on
behalf of the registrant or any affiliated purchaser, as defined in
Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of
shares or other units of any class of the registrants equity securities
that is registered by the registrant pursuant to Section 12 of the
Exchange Act (15 U.S.C. 781). Instruction to paragraph (a). Disclose
all purchases covered by this Item, including purchases that do not
satisfy the conditions of the safe harbor of Rule 10b-18 under the
Exchange Act (17 CFR 240.10b-18), made in the period covered by the
report. Provide disclosures covering repurchases made on a monthly basis.
For example, if the reporting period began on January 16 and ended on
July 15, the chart would show repurchases for the months from January 16
through February 15, February 16 through March 15, March 16 through
April 15, April 16 through May 15, May 16 through June 15, and June 16
through July 15.
During the period covered by this report, there were no purchases
made by or on behalf of the registrant or any affiliated purchaser
as defined in Rule 10b-18(a)(3) under the Securities Exchange Act
of 1934 (the Exchange Act), of shares of the registrants equity
securities that are registered by the registrant pursuant to
Section 12 of the Exchange Act.
Item 10. Submission of Matters to a Vote of Security Holders.
Describe any material changes to the procedures by which shareholders
may recommend nominees to the registrants board of directors, where
those changes were implemented after the registrant last provided
disclosure in response to the requirements of Item 7(d)(2)(ii)(G)
of Schedule 14A (17 CFR 240.14a-101), or this Item.
There have been no material changes to the procedures by which the
shareholders may recommend nominees to the registrants board of
directors since the registrant last provided disclosure in response
to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14(A) in
its definitive proxy statement, or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer
and principal financial officer have
concluded that the registrant's disclosure
controls and procedures are effective based
on their evaluation of these controls and
procedures as of a date within 90 days of the
filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the
registrant's internal control over financial
reporting that occurred during the second
fiscal quarter of the period covered by this
report that have materially affected, or are
reasonably likely to materially affect, the
registrant's internal control over financial
reporting.
The registrant's principal executive officer and principal financial
officer, however, voluntarily are reporting the following information:
In August of 2006 the registrant's investment adviser
enhanced its internal procedures for reporting performance
information required to be included in prospectuses.
Those enhancements involved additional internal controls
over the appropriateness of performance data
generated for this purpose. Such enhancements were made
following an internal review which identified
prospectuses relating to certain classes of shares of
a limited number of registrants where, inadvertently,
performance information not reflecting the deduction of
applicable sales charges was included. Those prospectuses
were revised, and the revised prospectuses were distributed to
shareholders.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer Municipal High Income Advantage Trust
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date May 30, 2012
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date May 30, 2012
By (Signature and Title)* /s/ Mark Bradley
Mark Bradley, Treasurer & Chief Accounting & Financial Officer
Date May 30, 2012
* Print the name and title of each signing officer under his or her signature.