File No. 33-84546
File No. 811-08786
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
PIONEER OAK RIDGE LARGE CAP GROWTH VCT PORTFOLIO
(Pioneer Variable Contracts Trust)
60 State Street
Boston, Massachusetts 02109
1-800-622-3265
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
SCHEDULED FOR December 28, 2004
This is the formal agenda for the portfolio's special shareholder meeting
("Meeting"). It tells you the matters you will be asked to vote on and the time
and place of the meeting, in case you want to attend in person.
To the shareholders of Pioneer Oak Ridge Large Cap Growth VCT Portfolio:
A special meeting of shareholders of your portfolio will be held at the
offices of Wilmer Cutler Pickering Hale and Dorr LLP, 60 State Street, 26th
Floor, Boston, Massachusetts on December 28, 2004 at 2:00 p.m., Boston time, to
consider the following:
1. A proposal to approve a new subadvisory agreement between Pioneer,
your portfolio's investment adviser, and Oak Ridge, your portfolio's
investment subadviser. This new agreement will take effect only if the
proposed acquisition by Pioneer's parent company of an ownership
interest in Oak Ridge is consummated.
2. To consider any other business that may properly come before the
meeting.
YOUR TRUSTEES RECOMMEND THAT YOU VOTE IN FAVOR OF THE PROPOSALS. APPROVAL OF
THE PROPOSALS WILL NOT INCREASE THE MANAGEMENT FEE RATES PAYABLE BY THE
PORTFOLIO.
Shareholders of record as of the close of business on November 17, 2004
are entitled to vote at the meeting and any related follow-up meetings.
By Order of the Board of Trustees,
Dorothy E. Bourassa, Secretary
Boston, Massachusetts
November 30, 2004
-----------------
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE AND RETURN
ENCLOSED PROXY OR, IF YOU ARE A CONTRACT OWNER, THE ENCLOSED VOTING INSTRUCTION
CARD.
16740-00-1204
PROXY STATEMENT OF
PIONEER OAK RIDGE LARGE CAP GROWTH VCT PORTFOLIO
(Pioneer Variable Contracts Trust)
60 State Street
Boston, Massachusetts 02109
1-800-622-3265
SPECIAL MEETING OF SHAREHOLDERS
This proxy statement contains the information you should know before
voting on the proposal summarized below.
The portfolio will furnish without charge a copy of its most recent annual
report and semiannual report to any shareholder or contract owner upon request.
Shareholders and contract owners who want to obtain a copy of these reports
should contact their insurance providers, direct all written requests to the
attention of the portfolio, at the address listed above, or should call Pioneer
Investment Management Shareholder Services, Inc., the portfolio's transfer
agent, at 1-800-622-3265.
INTRODUCTION
This proxy statement is being used by the board of trustees of Pioneer
Variable Contracts Trust (the "Trust") to solicit proxies on behalf of the
portfolio to be voted at a special meeting of shareholders. This meeting will
be held at the offices of Wilmer Cutler Pickering Hale and Dorr LLP, 60 State
Street, 26th Floor, Boston, Massachusetts 02109 at 2:00 p.m., Boston time, on
December 28, 2004, and at any adjournments or postponements of the meeting to a
later date, for the purposes as set forth in the accompanying notice of special
meeting to shareholders.
This meeting is being called to consider the approval of new subadvisory
agreement between Pioneer and Oak Ridge with respect to the portfolio. Approval
of new subadvisory agreements is required because of the proposed acquisition
by Pioneer Investment Management USA Inc. ("PIMUSA") of a 49% ownership
interest in Oak Ridge (the "Acquisition"). Additionally, Pioneer has the option
to further increase its ownership to a majority of the outstanding interests in
two years and to acquire the remaining interests in Oak Ridge in 12 years.
PIMUSA is the direct parent of Pioneer.
If consummated, the Acquisition will cause the existing subadvisory
agreements to terminate, requiring shareholder approval of new subadvisory
agreement. The Acquisition is not expected to result in any change in the
operations or personnel of Oak Ridge, except as noted below under "Information
concerning Oak Ridge," or in the services Oak Ridge provides to the portfolio.
In addition, the Acquisition will not increase the management fee rates payable
by the portfolio.
This proxy statement and the enclosed proxy card are being mailed to
shareholders of the portfolio on or about November 30, 2004. The portfolio will
furnish without charge a copy of its most recent annual report and any more
recent semiannual report to any
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shareholder upon request. Shareholders who want to obtain a copy of the
portfolio's reports should direct all written requests to the attention of the
portfolio, at the address listed above, or should call Pioneer Investment
Management Shareholder Services, Inc. ("PIMSS"), the portfolio's shareholder
servicing agent, at 1-800-622-3265.
WHO IS ELIGIBLE TO VOTE
If you are the owner of a variable annuity or variable life insurance contract:
If you are the owner of a variable annuity or variable life insurance
contract (a "contract owner"), the insurance company that issued your contract
is the record owner of portfolio shares. By completing and returning the
enclosed voting instruction card, you will instruct the insurance company how
to vote the shares of the portfolio attributable to your contract.
If you are an insurance company or plan that holds shares of a portfolio
directly:
Shareholders of record of the portfolio as of the close of business on
November 17, 2004 (the "record date") are entitled to vote on all of the
portfolio's business at the special shareholder meeting and any adjournments
thereof. Each share is entitled to one vote. Shares represented by properly
executed proxies, unless revoked before or at the meeting, will be voted
according to shareholders' instructions. If you sign a proxy, but do not fill
in a vote, your shares will be voted in favor of the proposal for your
portfolio. If any other business comes before the special shareholder meeting,
your shares will be voted at the discretion of the persons named as proxies.
PROPOSAL 1
APPROVAL OF A NEW SUBADVISORY AGREEMENT
Summary
Pioneer has served as investment adviser and Oak Ridge as investment
subadviser to the portfolio since it commenced investment operations on March
15, 2004.
PIMUSA, the parent company of Pioneer, intends to acquire a 49% ownership
interest in Oak Ridge (as defined above, the "Acquisition"). PIMUSA's
acquisition of a 49% interest in Oak Ridge will constitute an "assignment" (as
defined in the Investment Company Act of 1940 (the "1940 Act")) of the
portfolio's current subadvisory agreement with Oak Ridge (each, an "existing
subadvisory agreement"). As required by the 1940 Act, each existing subadvisory
agreement provides for its automatic termination in the event of an assignment.
Accordingly, the existing subadvisory agreement will terminate upon the
consummation of the Acquisition, and the new subadvisory agreement are being
proposed to enable Oak Ridge to continue to serve as subadviser to the
portfolio.
At a meeting of the board of trustees of the Trust held on July 8, 2004,
the trustees, including all of the trustees who are not "interested persons"
(as that term is defined in the 1940 Act) of the Trust, Pioneer or Oak Ridge
(collectively, the "independent trustees"), unanimously approved as in the best
interest of shareholders and voted to recommend that the shareholders of the
portfolio approve a proposal to adopt a new subadvisory
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agreement with Oak Ridge (each, a "proposed subadvisory agreement") effective
upon consummation of the Acquisition.
Except as noted below under "Information concerning Oak Ridge," no change
in the operations or personnel of Oak Ridge, including the portfolio manager
for the portfolio, is expected to result from the Acquisition.
Information concerning PIMUSA and Pioneer
PIMUSA is a Delaware corporation with its principal place of business at
60 State Street, Boston, Massachusetts 02109. PIMUSA is a wholly owned
subsidiary of Pioneer Global Asset Management S.p.A., which is organized under
the laws of the Republic of Italy ("PGAM"). PGAM is a wholly owned subsidiary
of Unicredito Italiano S.p.A., which is organized under the laws of the
Republic of Italy ("UniCredito"). UniCredito, one of the largest banking groups
in Italy, oversees an asset management group providing investment management
and financial services to mutual funds, institutional accounts and other
clients. PGAM is the global holding company of UniCredito's asset management
businesses. As of October 31, 2004, assets under management were approximately
$159 billion worldwide, including over $36 billion in assets under management
by Pioneer.
Pioneer serves as the investment adviser to the portfolio. Affiliates of
Pioneer, PIMSS and Pioneer Funds Distributor, Inc. ("PFD"), serve as the
shareholder servicing agent and principal underwriter, respectively, for the
portfolio. Each of Pioneer's, PIMSS's and PFD's principal place of business is
60 State Street, Boston, Massachusetts 02109.
Terms of the acquisition agreement
Upon consummation of the Acquisition, PIMUSA will acquire a 49% ownership
interest in Oak Ridge from the existing members of Oak Ridge. Certain of the
existing members and other employees of Oak Ridge will own the remaining 51% of
Oak Ridge. As part of the Acquisition, PIMUSA also will obtain the right to
purchase from the existing members of Oak Ridge (i) an additional 11% ownership
interest in Oak Ridge two years from the date on which the Acquisition is
consummated, and (ii) the remaining ownership interest 12 years from the date
on which the Acquisition is consummated. Consequently, the Acquisition provides
PIMUSA the right to own 100% of Oak Ridge over time.
The Acquisition is expected to occur on December 31, 2004, provided that a
number of conditions set forth in the acquisition agreement between PIMUSA and
Oak Ridge (the "Acquisition Agreement") are met or waived. These conditions
include the approval by shareholders of the proposed subadvisory agreement for
the portfolio and other Pioneer funds, consent from Oak Ridge's managed account
clients (including the portfolio) constituting, by market value, at least $1.2
billion in assets under management, and obtaining any necessary regulatory
approvals (including from the Bank of Italy).
No change in the portfolio's portfolio managers is anticipated to occur as
a result of the Acquisition. In addition, no change in the operations of Oak
Ridge or in the services Oak Ridge provides to the portfolio is expected to
occur as a result of the Acquisition. Except as noted below under "Information
concerning Oak Ridge," no change in the personnel of Oak Ridge is expected to
occur in connection with the Acquisition. However, PIMUSA's purchase of 49% of
Oak Ridge is not conditioned upon the continued
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employment of any Oak Ridge personnel, and there can be no assurance that any
particular Oak Ridge employee will choose to remain employed by Oak Ridge.
Anticipated benefits of the Acquisition
While no change in the management of the portfolio is currently planned,
the affiliation of Oak Ridge with a significantly larger asset management group
may benefit the portfolio by enhancing Oak Ridge's investment advisory
capabilities, including the subadvisory services provided to the portfolio. Oak
Ridge will have access to UniCredito's resources and the security of being part
of a larger, financially stronger company, which may enhance Oak Ridge's
ability to attract and retain highly qualified staff members.
Information concerning Oak Ridge
Oak Ridge is a growth investment management firm that serves as investment
adviser to individual and institutional clients. Oak Ridge, including its
affiliated broker-dealer, Oak Ridge Investments, Inc., has been in the
investment management business since September 1989. As of October 31, 2004,
assets under management were approximately $1.582 billion. Oak Ridge is
currently located at 10 South LaSalle Street, Suite 1250, Chicago, Illinois
60603. Oak Ridge is owned 100% by its employees and is controlled by its
founders, David Klaskin and Samuel Wegbreit. Mr. Wegbreit will not be
affiliated with Oak Ridge following the Acquisition but will be available to
Oak Ridge for consulting during the first year following the Acquisition at
Oak Ridge's expense. Information regarding Oak Ridge, its principal
executive officer and directors, and its other investment company clients is
included in Exhibit B to this proxy statement.
Terms of the proposed and existing subadvisory agreements
The terms of the portfolio's proposed subadvisory agreement are
substantially identical to the terms of the portfolio's existing subadvisory
agreement, except for the dates of execution, effectiveness and termination,
and any provisions regarding interim subadvisory agreement discussed below. The
stated subadvisory fees to be paid by Pioneer to Oak Ridge are identical under
the proposed subadvisory agreement and the existing subadvisory agreement. All
the terms described below with respect to the portfolio's proposed subadvisory
agreement are contained in the portfolio's existing subadvisory agreement. The
following summary of all of the material terms of the proposed subadvisory
agreement which summary is qualified by reference to the representative form of
proposed subadvisory agreement attached to this proxy statement as Exhibit A.
The existing subadvisory agreement was most recently submitted to the initial
shareholder of each portfolio for approval on March 12, 2004, in connection
with the commencement of the portfolio's operations.
Services. Under the proposed subadvisory agreement, Oak Ridge will,
subject to the supervision of Pioneer and the board of trustees of the Trust,
regularly provide the portfolio with investment research, advice and
supervision and shall furnish continuously an investment program for the
portfolio, consistent with the investment objective and policies of the
portfolio. Oak Ridge will also provide assistance to Pioneer with respect to
the voting of proxies for the portfolio as Pioneer may request. Oak Ridge shall
maintain certain books and records with respect to the portfolio's securities
transactions and will cooperate with
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and provide reasonable assistance to Pioneer, the portfolio, and the
portfolio's other agents and representatives with respect to requests for
information and preparation of regulatory filings and reports. Oak Ridge will
bear its own costs of providing services under the subadvisory agreement. See
"Brokerage practices."
Compensation. Pioneer will pay Oak Ridge a monthly fee equal on an annual
basis to the following percentages of the average daily net assets of the
portfolio:
Pioneer Oak Ridge Large Cap Growth VCT Portfolio Assets Rate
- --------------------------------------------------------------------- ----------
First $250 Million .............................................. 0.45%
Greater than $250 Million and less than or equal to $500 Million 0.40%
Greater than $500 Million and less than or equal to $750 Million 0.35%
Greater than $750 Million ....................................... 0.30%
Limitation of Liability. The proposed subadvisory agreement provides that
Oak Ridge shall not be liable to Pioneer or the portfolio for any losses,
claims, damages, liabilities or litigation incurred or suffered by Pioneer or
the portfolio as a result of any error of judgment or mistake of law by Oak
Ridge with respect to the portfolio, except that Oak Ridge shall be liable for
and shall indemnify Pioneer and the portfolio against any loss arising out of
or based on (i) Oak Ridge being in violation of any applicable federal or state
law, rule or regulation or any investment policy or restriction set forth in
the portfolio's prospectus or statement of additional information or any
written guidelines or instructions provided in writing to Oak Ridge by the
trustees of the Trust or Pioneer, (ii) the portfolio's failure to satisfy the
diversification or source of income requirements of Subchapter L or M of the
Internal Revenue Code of 1986, as amended, by reason of an act or omission of
Oak Ridge, unless acting at the direction of Pioneer, (iii) Oak Ridge's willful
misfeasance, bad faith or gross negligence generally in the performance of its
duties under the proposed subadvisory agreement or its reckless disregard of
its obligations and duties under the proposed subadvisory agreement, or (iv)
the portfolio being in violation of any applicable federal or state law, rule
or regulation or any written guidelines or instructions provided in writing to
Oak Ridge by the trustees of the Trust or Pioneer by reason of any action or
inaction by Oak Ridge.
Term, Termination. The proposed subadvisory agreement shall remain in
force provided its continuance is approved prior to December 31, 2005 by a
majority of the independent trustees and by either (i) a majority vote of the
board of trustees or (ii) the affirmative vote of a majority of the outstanding
voting securities of the portfolio. The proposed subadvisory agreement may be
terminated at any time on not more than sixty (60) days' nor less than thirty
(30) days' written notice without penalty by (a) Pioneer, (b) the Trust's board
of trustees, (c) a majority of the portfolio's outstanding voting securities,
as defined in the 1940 Act, or (d) Oak Ridge. Each proposed subadvisory
agreement shall automatically terminate in the event of its assignment or upon
termination of the investment advisory agreement between the portfolio and
Pioneer.
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Brokerage practices
All orders for the purchase or sale of portfolio securities are placed on
behalf of the portfolio by Oak Ridge pursuant to authority contained in the
subadvisory agreement. Oak Ridge seeks to obtain the best execution on
portfolio trades. The price of securities and any commission rate paid are
always factors, but frequently not the only factors, in judging best execution.
In selecting brokers or dealers, Oak Ridge considers various relevant factors,
including, but not limited to, the size and type of the transaction; the nature
and character of the markets for the security to be purchased or sold; the
execution efficiency, settlement capability and financial condition of the
dealer; the dealer's execution services rendered on a continuing basis; and the
reasonableness of any dealer spreads. Transactions in non-U.S. equity
securities may be executed by broker-dealers in non-U.S. countries in which
commission rates may not be negotiable (as such rates are in the U.S.).
Section 28(e) of the Securities Exchange Act of 1934, as amended, permits
an investment advisor, under certain circumstances, to cause an account to pay
a broker or dealer who supplies brokerage and research services a commission
for effecting a transaction in excess of the amount of commission another
broker or dealer would have charged for effecting the transaction. Brokerage
and research services include (i) furnishing advice as to the value of
securities, the advisability of investing, purchasing or selling securities and
the availability of securities or purchasers or sellers of securities; (ii)
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy and the performance of
accounts; and (iii) effecting securities transactions and performing functions
incidental thereto (such as clearance, settlement and custody). These
transactions with broker-dealers are often referred to as "soft-dollar"
transactions; and the commissions paid for execution and services are often
referred to as "soft-dollar" commissions.
In selecting brokers or dealers, Oak Ridge considers investment and market
information and other research, such as economic, securities and performance
measurement research provided by such brokers or dealers and the quality and
reliability of brokerage services, including execution capability, performance
and financial responsibility. Accordingly, the commissions charged by any such
broker or dealer may be greater than the amount another firm might charge if
Oak Ridge determines in good faith that the amount of such commissions is
reasonable in relation to the value of the research information and brokerage
services provided by such broker or dealer to the portfolio. Oak Ridge believes
that the research information received in this manner provides the portfolio
with benefits by supplementing the research otherwise available to it. Such
higher commissions will not, however, be paid by the portfolio unless (i) Oak
Ridge determines in good faith that the amount is reasonable in relation to the
services in terms of the particular transaction or in terms of Oak Ridge's
overall responsibilities with respect to the accounts, including the portfolio,
as to which it exercises investment discretion; (ii) such payment is made in
compliance with the provisions of Section 28(e) and other applicable state and
federal laws; and (iii) in the opinion of Oak Ridge, the total commissions paid
by the applicable portfolio is reasonable in relation to the benefits to the
portfolio over the long-term. In addition, such higher commissions will not be
paid
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by the portfolio with respect to portfolio transactions in which any broker
affiliated with Oak Ridge is serving as broker to the portfolio.
Oak Ridge places portfolio transactions for other advisory accounts in
addition to the portfolio. Research services furnished by firms through which
the portfolio effects securities transactions may be used by Oak Ridge in
servicing all of its accounts; that is, not all of such services may be used by
Oak Ridge in connection with the portfolio. Oak Ridge believes it is not
possible to measure separately the benefits from research services to each of
the accounts (including the portfolio) managed by it. Because the volume and
nature of the trading activities of the accounts are not uniform, the amount of
commissions in excess of those charged by another broker or dealer paid by each
account for brokerage and research services will vary. However, Oak Ridge
believes such costs to the portfolio will not be disproportionate to the
benefits received by the portfolio on a continuing basis. Oak Ridge seeks to
allocate portfolio transactions equitably whenever concurrent decisions are
made to purchase or sell securities by the portfolio and another advisory
account. In some cases, this procedure could have an adverse effect on the
price or the amount of securities available to the portfolio. There can be no
assurance that a particular purchase or sale opportunity will be allocated to
the portfolio. In making such allocations between the portfolio and other
advisory accounts, the main factors considered by Oak Ridge are the respective
investment objectives, the relative size of portfolio holdings of the same or
comparable securities, the availability of cash for investment and the size of
investment commitments generally held.
The Pioneer funds have entered into third-party brokerage and/or expense
offset arrangements to reduce the funds' total operating expenses. Pursuant to
third-party brokerage arrangements, certain of the funds that invest primarily
in U.S. equity securities may incur lower custody fees by directing brokerage
to third-party broker-dealers. Pursuant to expense offset arrangements, the
funds incur lower transfer agency expenses by maintaining their cash balances
with the custodian.
Similar funds
Oak Ridge serves as the investment subadviser to the portfolio and to
other similar Pioneer funds, Pioneer Oak Ridge Large Cap Growth Fund and
Pioneer Oak Ridge Small Cap Growth. Each fund pays Pioneer a fee for managing
the fund and to cover the cost of providing certain services to the fund.
Pioneer's annual fee is equal to 0.75% of the fund's average daily net assets
up to $1 billion and 0.70% on assets over $1 billion and, as of October 31,
2004, Pioneer Oak Ridge Large Cap Growth Fund and Pioneer Oak Ridge Small Cap
Growth Fund had net assets of $59,809,993 and $60,538,353 respectively. The fee
is normally computed daily and paid monthly. Pioneer, and not the fund, pays a
portion of the fee it receives from the fund to Oak Ridge as compensation for
Oak Ridge's subadvisory services to the fund. Pioneer has contractually agreed
not to impose all or a portion of its management fee and, if necessary, to
limit other ordinary operating expenses to the extent required to reduce Class
A expenses to 1.50% of the average daily net assets attributable to Class A
shares; the portion of fund expenses attributable to Class B and Class C shares
will be reduced only to the extent such expenses are reduced for Class A
shares.
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Factors considered by the trustees
The trustees of the portfolio determined that the terms of the proposed
subadvisory agreement is fair and reasonable and that approval of the proposed
subadvisory agreement on behalf of the portfolio is in the best interest of the
portfolio and its shareholders. In evaluating the proposed subadvisory
agreements the trustees reviewed materials furnished by Pioneer and Oak Ridge,
including information regarding Oak Ridge, its personnel, operations and
financial condition and the services to be provided by Pioneer and Oak Ridge.
The trustees specifically considered the following as relevant to their
recommendations: (1) the nature and quality of the services provided by Oak
Ridge to the portfolio to date; (2) the investment performance of the portfolio
since its inception in 2004 and Oak Ridge in managing similar accounts
including: the favorable history, reputation, qualification and background of
Oak Ridge, as well as the qualifications of its personnel and its financial
condition; (3) that no change in the operations of Oak Ridge is expected as a
result of the Acquisition, including no change in the portfolio managers for
the portfolio; (4) the fact that the compensation paid to Pioneer was
determined to be fair and reasonable, and Pioneer will pay the compensation of
Oak Ridge and the management fee paid by the portfolio will not be affected by
the Acquisition; (5) the potential benefits to the portfolio that may be
realized from Oak Ridge as a result of its affiliation with PGAM; and (6) other
factors deemed relevant by the trustees. The trustees relied upon comparisons
of the services to be rendered and the amounts to be paid under the subadvisory
agreement with those under other investment advisory arrangements with Oak
Ridge and other investment advisers.
Due to Oak Ridge's capacity as a subadviser whose services are supervised
by Pioneer and whose compensation is the responsibility of Pioneer, the
trustees either did not consider, or considered as less relevant to their
analysis, the following factors: (1) the costs of the services to be provided
and profits to be realized by Oak Ridge and its affiliates from the
relationship with the portfolio; (2) the extent to which economies of scale
would be realized as the portfolio grows; and (3) whether fee levels reflect
these economies of scale for the benefit of the portfolio shareholders.
Trustees' recommendation
At a meeting of the board of trustees for the portfolio held on July 8,
2004, the trustees, including all of the independent trustees, unanimously
approved as in the best interest of shareholders and voted to recommend that
the shareholders of the portfolio approve, a proposal to adopt a subavisory
agreement with Oak Ridge. Based on their evaluation of the materials presented
and assisted by the advice of independent counsel, the trustees at the meeting,
including all of the independent trustees, Oak Ridge, Pioneer or UniCredito,
unanimously concluded that the terms of the proposed subadvisory agreement are
reasonable, fair and in the best interest of the portfolio and its shareholders
and that the fees provided therein are fair and reasonable in light of the
usual and customary charges made by others for services of the same nature and
quality. The trustees, by a unanimous vote cast at the meeting, approved and
voted to recommend to the shareholders of the portfolio that they approve the
proposed subadvisory agreement. The board of trustees approved and recommended
such actions with respect
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to both the initial acquisition of a 49% interest in Oak Ridge and the rights
to acquire, in two years and twelve years, respectively, from the closing of
the Acquisition, a further 11% interest and all of the remaining interests in
Oak Ridge.
If the shareholders of the portfolio do not approve the proposed
subadvisory agreement with respect to their portfolio and the Acquisition is
consummated, the trustees of the Trust would consider what further action to
take consistent with their fiduciary duties to the portfolio. Such actions may
include re-solicitation of shareholders with respect to this proposal or having
Pioneer manage the portfolio without the use of a subadviser.
Required vote
As provided under the 1940 Act, approval of the proposed subadvisory
agreement requires the vote of a majority of the outstanding voting securities
of the portfolio. In accordance with the 1940 Act, a "majority of the
outstanding voting securities" of the portfolio means the lesser of (1) 67% or
more of the shares of the portfolio present at a shareholder meeting if the
owners of more than 50% of the shares of the portfolio then outstanding are
present in person or by proxy, or (2) more than 50% of the outstanding shares
of the portfolio entitled to vote at the shareholder meeting.
However, in addition to the legal requirement under the 1940 Act, the
consummation of the Acquisition is conditioned upon the satisfaction or waiver
of several requirementsin addition to the approval by shareholders of the
proposed subadvisory agreement for the portfolio, including consent from Oak
Ridge's managed account clients (including the portfolios) constituting, by
market value, at least $1.2 billion in assets under management, and obtaining
any necessary regulatory approvals (including from the Bank of Italy).
Recommendation
For the reasons set forth above, the trustees unanimously recommend that
shareholders of the portfolio vote in favor of the proposal to approve the
proposed subadvisory agreement.
INFORMATION CONCERNING THE MEETING
Outstanding shares and quorum
As of the record date, 319,627.666 shares of beneficial interest of the
portfolio were outstanding. Only shareholders of record as of the record date
are entitled to notice of and to vote at the meeting. One-third of the
outstanding shares of the portfolio that are entitled to vote will be
considered a quorum for the transaction of business by the portfolio.
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Ownership of shares of the portfolio
To the knowledge of the Trust, as of October 31, 2004, the following
persons owned of record or beneficially 5% or more of the outstanding Class II
shares of the portfolio:
No. and class Percentage
Name and address of shares owned of class (%)
- ---------------------------- ----------------- -------------
Travelers Life & Annuity
P.O. Box 990027
Hartford, CT 06199 ......... 165,262.112 57.42
Travelers Insurance Company
P.O. Box 990027
Hartford, CT 06199 ......... 112,518.043 39.09
Shareholder proposals
The portfolio is required to hold annual meetings of shareholders and does
not currently intend to hold an annual meeting of shareholders in 2004 or 2005.
Any shareholder proposal intended to be presented at the next meeting of
shareholders of the portfolio, whenever held, must be received at the Trust's
offices, 60 State Street, Boston, Massachusetts 02109, at a reasonable time
prior to the trustees' solicitation of proxies for the meeting. The submission
by a shareholder of a proposal for inclusion in a proxy statement does not
guarantee that it will be included. Shareholder proposals are subject to
certain regulations under the federal securities laws.
Shares held in retirement plans
The trustee or custodian of certain retirement plans is required to vote
any unvoted portfolio shares held in such plans in proportion to the
percentages voted by shareholders in person or by proxy.
Proxies, quorum and voting at the meeting
Any shareholder who has given his or her proxy to someone has the power to
revoke that proxy at any time prior to its exercise by executing a superseding
proxy or by submitting a notice of revocation to the secretary of the Trust on
behalf of a portfolio. In addition, although mere attendance at the shareholder
meeting will not revoke a proxy, a shareholder present at the shareholder
meeting may withdraw his or her proxy and vote in person. All properly executed
and unrevoked proxies received in time for the shareholder meeting will be
voted in accordance with the instructions contained in the proxies. If no
instruction is given, the persons named as proxies will vote the shares
represented thereby in favor of the proposals described above and will use
their best judgment in connection with the transaction of such other business
as may properly come before the shareholder meeting or any adjournment or
postponement thereof.
One-third of the outstanding shares of the portfolio that are entitled to
vote, present in person or represented by proxy, constitutes a quorum for the
transaction of business with respect to the proposal; however, since each
proposal must be approved by a "majority of the outstanding voting securities",
as defined in the 1940 Act, at least 50% of the outstanding shares must be
present in person or by proxy at the meeting to approve the proposals. In the
event that at the time any session of the shareholder meeting is called
10
to order, a quorum is not present in person or by proxy, the persons named as
proxies may vote those proxies that have been received to adjourn the
shareholder meeting to a later date. In the event that a quorum is present but
sufficient votes in favor of any of the proposals have not been received, the
persons named as proxies may propose one or more adjournments of the
shareholder meeting to permit further solicitation of proxies with respect to
such proposal. Any such adjournment will require the affirmative vote of more
than one-half of the shares of the portfolio present in person or by proxy at
the session of the shareholder meeting to be adjourned. The persons named as
proxies will vote those proxies that they are entitled to vote in favor of the
proposal in favor of such an adjournment and will vote those proxies required
to be voted against the proposal against any such adjournment. A shareholder
vote may be taken on any proposal in the proxy statement prior to such
adjournment if sufficient votes for its approval have been received and it is
otherwise appropriate. Such vote will be considered final regardless of whether
the meeting is adjourned to permit additional solicitation with respect to any
other proposal.
Shares of the portfolio represented in person or by proxy, including
shares that abstain or do not vote with respect to the proposal, will be
counted for purposes of determining whether there is a quorum at the
shareholder meeting. Accordingly, an abstention from voting has the same effect
as a vote against the proposal. If a broker or nominee holding shares in
"street name" indicates on the proxy card that it does not have discretionary
authority to vote on the proposal, those shares will not be considered present
and entitled to vote on that proposal. Thus, a "broker non-vote" has no effect
on the voting in determining whether the proposal has been adopted by 67% or
more of the portfolio's shares present at the shareholder meeting, if more than
50% of the outstanding shares (excluding the "broker non-votes") of the
portfolio are present or represented. For purposes of determining whether the
proposal has been adopted by more than 50% of the outstanding shares of the
portfolio, a "broker non-vote" has the same effect as a vote against that
proposal because shares represented by a "broker non-vote" are considered to be
outstanding shares.
Voting by contract owners
Because the insurance company that issued your variable annuity or
variable life insurance contract is the owner of record of shares of the
portfolio, your vote will instruct the insurance company how to vote the shares
of the portfolio attributable to your contract. The insurance company will vote
all of the shares of the portfolio which it holds that are not attributable to
any contract in the same proportion as the voting instructions received from
its contract owners with respect to the portfolio. The insurance company will
also vote those shares for which no timely voting instruction was received from
the contract owner in the same proportion as the voting instructions timely
received from its other contract owners with respect to the portfolio.
Householding
If you have previously given the portfolio permission to do so, the
portfolio may send a single proxy statement to your residence for you and any
other member of your household who has an account with the portfolio. If you
wish to revoke your consent to
11
this practice, you may do so by notifying your portfolio, by phone or in
writing by using the telephone number and address on page 1 of the proxy. The
portfolio will begin mailing separate proxy statements, prospectuses and
shareholder reports to you within 30 days after receiving your notice.
Other business
While the shareholder meeting has been called to transact any business
that may properly come before it, the only matters that the trustees intend to
present are those matters stated in the attached notice of special meeting of
shareholders. However, if any additional matters properly come before the
shareholder meeting, and on all matters incidental to the conduct of the
meeting, the persons named in the enclosed proxy intend to vote the proxy in
accordance with their judgment on such matters unless instructed to the
contrary.
Method of solicitation and expenses
The cost of preparing, assembling and mailing this proxy statement, the
attached notice of special meeting of shareholders and the accompanying proxy
card will be borne by Pioneer. In addition to soliciting proxies by mail,
Pioneer may, at its expense, have one or more of the Trust's officers,
representatives or compensated third-party agents, including Pioneer, Oak
Ridge, PIMSS and PFD and, with respect to contract owners, one or more
officers, agents or representatives of the insurance companies issuing the
contracts, aid in the solicitation of proxies by personal interview or
telephone and telegraph and may request brokerage houses and other custodians,
nominees and fiduciaries to forward proxy soliciting material to the beneficial
owners of the shares held of record by such persons.
The portfolio may also arrange to have votes recorded by telephone, the
Internet or other electronic means. The voting procedures used in connection
with such voting methods are designed to authenticate shareholders' identities,
to allow shareholders to authorize the voting of their shares in accordance
with their instructions and to confirm that their instructions have been
properly recorded. If these procedures were subject to a successful legal
challenge, such votes would not be counted at the shareholder meeting. The
portfolio is not aware of any such challenge at this time. In the case of
telephone voting, shareholders would be called at the telephone number PIMSS
has in its records for their accounts, and would be asked for their Social
Security number or other identifying information. The shareholders would then
be given an opportunity to authorize proxies to vote their shares at the
meeting in accordance with their instructions. In the case of automated
telephone and Internet voting, shareholders would be required to provide their
Social Security number or other identifying information and would receive a
confirmation of their instructions.
Persons holding shares as nominees will be reimbursed by Pioneer, upon
request, for the reasonable expenses of mailing soliciting materials to the
principals of the accounts.
November 30, 2004
12
EXHIBIT A
SUB-ADVISORY AGREEMENT
SUB-ADVISER AGREEMENT made as of this 31st day of December, 2004 by and
between PIONEER INVESTMENT MANAGEMENT, INC., a Delaware corporation and a
member of the UniCredito Italiano banking group, register of banking groups
with its principal place of business at 60 State Street, Boston, Massachusetts
02109 (the "Adviser"), and OAK RIDGE INVESTMENTS, LLC, an Illinois limited
liability company with its principal place of business at 10 South LaSalle
Street, Suite 1050, Chicago, Illinois 60603 ("Sub-Adviser").
W I T N E S S E T H
WHEREAS, the Adviser serves as investment manager to Pioneer Oak Ridge
Large Cap Growth VCT Portfolio, a series of Pioneer Variable Contracts Trust
(the "Fund"), pursuant to the Management Agreement between the Fund and the
Adviser dated March 12, 2004 (the "Management Agreement");
WHEREAS, pursuant to authority granted to the Adviser by the Board of
Trustees of the Fund (the "Board") and pursuant to the provisions of the
Management Agreement, the Adviser has selected the Sub-Adviser to act as
investment sub-adviser of the Fund and to provide certain other services, as
more fully set forth below, and to perform such services under the terms and
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and benefits set
forth herein, the Adviser and the Sub-Adviser do hereby agree as follows:
1. The Sub-Adviser's Services.
(a) Investment Services. The Sub-Adviser shall act as sub-investment
adviser with respect to the Fund. In such capacity, the
Sub-Adviser shall, subject to the supervision of the Adviser and
the Board, regularly provide the Fund with investment research,
advice and supervision and shall furnish continuously an
investment program for the Fund, consistent with the investment
objectives and policies of the Fund. The Sub-Adviser shall
determine, from time to time, what securities shall be purchased
for the Fund, what securities shall be held or sold by the Fund
and what portion of the Fund's assets shall be held uninvested in
cash, subject always to the provisions of the Fund's Certificate
of Trust, Agreement and Declaration of Trust, By-Laws and its
registration statement on Form N-1A (the "Registration Statement")
under the Investment Company Act of 1940, as amended (the "1940
Act"), and under the Securities Act of 1933, as amended (the "1933
Act"), covering the Fund's shares, as filed with the Securities
and Exchange Commission (the "Commission"), and to the investment
objectives, policies and restrictions of the Fund, as each of the
same shall be from time to time in effect. To carry out such
obligations, the Sub-Adviser shall exercise full discretion and
act for the Fund in the same manner and with the same force and
effect as the Fund itself might
A-1
or could do with respect to purchases, sales or other
transactions, as well as with respect to all other such things
necessary or incidental to the furtherance or conduct of such
purchases, sales or other transactions. Notwithstanding the
foregoing, the Sub-Adviser shall, upon written instructions from
the Adviser, effect such portfolio transactions for the Fund as
the Adviser may from time to time direct. No reference in this
Agreement to the Sub-Adviser having full discretionary authority
over the Fund's investments shall in any way limit the right of
the Adviser, in its sole discretion, to establish or revise
policies in connection with the management of the Fund's assets or
to otherwise exercise its right to control the overall management
of this Fund's assets.
(b) Compliance. The Sub-Adviser agrees to comply with the requirements
of the 1940 Act, the Investment Advisers Act of 1940 (the
"Advisers Act"), the 1933 Act, the Securities Exchange Act of
1934, as amended (the "1934 Act"), the Commodity Exchange Act and
the respective rules and regulations thereunder, as applicable, as
well as with all other applicable federal and state laws, rules,
regulations and case law that relate to the services and
relationships described hereunder and to the conduct of its
business as a registered investment adviser. The Sub-Adviser also
agrees to comply with the objectives, policies and restrictions
set forth in the Registration Statement, as amended or
supplemented, of the Fund, and with any policies, guidelines,
instructions and procedures approved by the Board or the Adviser
and provided to the Sub-Adviser. In selecting the Fund's portfolio
securities and performing the Sub-Adviser's obligations hereunder,
the Sub-Adviser shall cause the Fund to comply with the
requirements of Subchapter L and M of the Internal Revenue Code of
1986, as amended (the "Code"), for qualification as a regulated
investment company. The Sub-Adviser shall maintain compliance
procedures for the Fund that it reasonably believes are adequate
to ensure the Fund's compliance with the foregoing. The
Sub-Adviser shall also maintain compliance procedures that it
reasonably believes are adequate to ensure its compliance with the
Advisers Act. No supervisory activity undertaken by the Adviser
shall limit the Sub-Adviser's full responsibility for any of the
foregoing.
(c) Proxy Voting. The Board has the authority to determine how
proxies with respect to securities that are held by the Fund shall
be voted, and the Board has initially determined to delegate the
authority and responsibility to vote proxies for the Fund's
securities to the Adviser. So long as proxy voting authority for
the Fund has been delegated to the Adviser, the Sub-Adviser shall
provide such assistance to the Adviser with respect to the voting
of proxies for the Fund as the Adviser may from time to time
reasonably request, and the Sub-Adviser shall promptly forward to
the Adviser any information or documents necessary for the Adviser
to exercise its proxy voting responsibilities. The Sub-Adviser
shall not vote proxies with respect
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to the securities held by the Fund unless and until the Board or
the Adviser delegates such authority and responsibility to the
Sub-Adviser or otherwise instructs the Sub-Adviser to do so in
writing, whereupon the Sub-Adviser shall carry out such
responsibility in accordance with the Fund's Proxy Voting Policies
and any instructions that the Board or the Adviser shall provide
from time to time and shall provide such reports and keep such
records relating to proxy voting as the Board or the Adviser may
reasonably request or as may be necessary for the Fund to comply
with the 1940 Act and other applicable law. Any such delegation of
proxy voting responsibility to the Sub-Adviser may be revoked or
modified by the Board or the Adviser at any time.
(d) Recordkeeping. The Sub-Adviser shall not be responsible for the
provision of administrative, bookkeeping or accounting services to
the Fund, except as otherwise provided herein or as may be
necessary for the Sub-Adviser to supply to the Adviser, the Fund
or its Board the information required to be supplied under this
Agreement.
The Sub-Adviser shall maintain separate books and detailed records
of all matters pertaining to the Fund's assets advised by the
Sub-Adviser required by Rule 31a-1 under the 1940 Act (other than
those records being maintained by the Adviser, custodian or
transfer agent appointed by the Fund) relating to its
responsibilities provided hereunder with respect to the Fund, and
shall preserve such records for the periods and in a manner
prescribed therefore by Rule 31a-2 under the 1940 Act (the "Fund's
Books and Records"). The Fund's Books and Records shall be
available to the Adviser and the Board at any time upon request,
shall be delivered to the Fund upon the termination of this
Agreement and shall be available for telecopying without delay
during any day the Fund is open for business.
(e) Holdings Information and Pricing. The Sub-Adviser shall keep the
Fund and the Adviser informed of developments materially affecting
the Fund's holdings, and shall, on its own initiative, furnish the
Fund and the Adviser from time to time with whatever information
the Sub-Adviser believes is appropriate for this purpose. The
Sub-Adviser agrees to immediately notify the Adviser if the
Sub-Adviser believes that the market value of any security held by
the Fund is not an appropriate fair value and provide pricing
information to the Adviser and/or the Fund's pricing agent as may
be necessary to make determinations of the fair value of certain
portfolio securities when market quotations are not readily
available or such information is otherwise required in accordance
with the 1940 Act and the Fund's valuation procedures for the
purpose of calculating the Fund's net asset value in accordance
with procedures and methods established by the Board.
(f) Cooperation with Agents of the Adviser and the Fund. The
Sub-Adviser agrees to cooperate with and provide reasonable
assistance to the Adviser,
A-3
the Fund, the Fund's custodian and foreign sub-custodians, the
Fund's pricing agents and all other agents and representatives of
the Fund and the Adviser, such information with respect to the
Fund as they may reasonably request from time to time in the
performance of their obligations, provide prompt responses to
reasonable requests made by such persons and establish appropriate
interfaces with each so as to promote the efficient exchange of
information and compliance with applicable laws and regulations.
2. Code of Ethics. The Sub-Adviser has adopted a written code of ethics
that it reasonably believes complies with the requirements of Rule
17j-1 under the 1940 Act, which it will provide to the Adviser and the
Fund. The Sub-Adviser shall ensure that its Access Persons (as defined
in the Sub-Adviser's Code of Ethics) comply in all respects with the
Sub-Adviser's Code of Ethics, as in effect from time to time. Upon
request, the Sub-Adviser shall provide the Fund with a (i) a copy of
the Sub-Adviser's current Code of Ethics, as in effect from time to
time, and (ii) certification that it has adopted procedures reasonably
necessary to prevent Access Persons from engaging in any conduct
prohibited by the Sub-Adviser's Code of Ethics. Annually, the
Sub-Adviser shall furnish a written report, which complies with the
requirements of Rule 17j-1, concerning the Sub-Adviser's Code of
Ethics to the Fund and the Adviser. The Sub-Adviser shall respond to
requests for information from the Adviser as to violations of the Code
by Access Persons and the sanctions imposed by the Sub-Adviser. The
Sub-Adviser shall immediately notify the Adviser of any material
violation of the Code, whether or not such violation relates to any
security held by the Fund.
3. Information and Reporting. The Sub-Adviser shall keep the Fund and the
Adviser informed of developments relating to its duties as Sub-Adviser
of which the Sub-Adviser has, or should have, knowledge that
materially affect the Fund. In this regard, the Sub-Adviser shall
provide the Fund, the Adviser, and their respective officers with such
periodic reports concerning the obligations the Sub-Adviser has
assumed under this Agreement as the Fund and the Adviser may from time
to time reasonably request.
(a) Notification of Breach / Compliance Reports. The Sub-Adviser
shall notify the Adviser immediately upon detection of (i) any
failure to manage the Fund in accordance with its investment
objectives and policies or any applicable law; or (ii) any breach
of any of the Fund's or the Adviser's policies, guidelines or
procedures. In addition, the Sub-Adviser shall provide a monthly
certification that the Fund is in compliance with its investment
objectives and policies, applicable law, including, but not
limited to the 1940 Act and Subchapters L and M of the Code, and
the Fund's and the Adviser's policies, guidelines or procedures.
The Sub-Adviser acknowledges and agrees that the Adviser may, in
its discretion, provide such monthly compliance certifications to
the Board. The Sub-Adviser agrees to correct any such failure
promptly and to take any action that the Adviser may reasonably
request in connection with any such
A-4
breach. The Sub-Adviser shall also provide the officers of the
Fund with supporting certifications in connection with such
certifications of the Fund's financial statements and disclosure
controls pursuant to the Sarbanes-Oxley Act. The Sub-Adviser will
promptly notify the Adviser if (i) the Sub-Adviser is served or
otherwise receives notice of any action, suit, proceeding, inquiry
or investigation, at law or in equity, before or by any court,
public board, or body, involving the affairs of the Fund
(excluding class action suits in which the Fund is a member of the
plaintiff class by reason of the Fund's ownership of shares in the
defendant) or the compliance by the Sub-Adviser with the federal
or state securities laws or (ii) the controlling stockholder or
executive committee of the Sub-Adviser changes, there is otherwise
an actual change in control (whether through sale of all or
substantially all the assets of the Sub-Adviser or a material
change in management of the Sub-Adviser) or an "assignment" (as
defined in the 1940 Act) has or is proposed to occur.
(b) Inspection. Upon request, with at least 24 hours advance notice,
the Sub-Adviser agrees to make its records and premises (including
the availability of the Sub-Adviser's employees for interviews) to
the extent that they relate to the conduct of services provided to
the Fund or the Sub-Adviser's conduct of its business as an
investment adviser available for compliance audits by the Adviser
or the Fund's employees, accountants or counsel; in this regard,
the Fund and the Adviser acknowledge that the Sub-Adviser shall
have no obligations to make available proprietary information
unrelated to the services provided to the Fund or any information
related to other clients of the Sub-Adviser, except to the extent
necessary for the Adviser to confirm the absence of any conflict
of interest and compliance with any laws, rules or regulations in
the management of the Fund.
(c) Board and Filings Information. The Sub-Adviser will also provide
the Adviser with any information reasonably requested regarding
its management of the Fund required for any meeting of the Board,
or for any shareholder report, amended registration statement,
proxy statement, or prospectus supplement to be filed by the Fund
with the Commission. The Sub-Adviser will make its officers and
employees available to meet with the Board from time to time on
due notice to review the investments of the Fund in light of
current and prospective economic and market conditions and shall
furnish to the Board such information as may reasonably be
necessary in order for the Board to evaluate this Agreement or any
proposed amendments thereto.
(d) Transaction Information. The Sub-Adviser shall furnish to the
Adviser such information concerning portfolio transactions as may
be necessary to enable the Adviser to perform such compliance
testing on the Fund and the Sub-Adviser's services as the Adviser
may, in its sole discretion, determine to be appropriate. The
provision of such information by the
A-5
Sub-Adviser in no way relieves the Sub-Adviser of its own
responsibilities for ensuring the Fund's compliance.
4. Brokerage.
(a) Principal and Agency Transactions. In connection with purchases
or sales of securities for the account of the Fund, neither the
Sub-Adviser nor any of its directors, officers, employees or
affiliated persons will act as a principal or agent or receive any
commission except as permitted by the 1940 Act.
(b) Placement of Orders. The Sub-Adviser shall arrange for the placing
of all orders for the purchase and sale of securities for the
Fund's account with brokers or dealers selected by the
Sub-Adviser. In the selection of such brokers or dealers and the
placing of such orders, the Sub-Adviser is directed at all times
to seek for the Fund the most favorable execution and net price
available except as described herein. It is also understood that
it is desirable for the Fund that the Sub-Adviser have access to
supplemental investment and market research and security and
economic analyses provided by brokers who may execute brokerage
transactions at a higher cost to the Fund than may result when
allocating brokerage to other brokers, as consistent with Section
28(e) of the 1934 Act and any Commission staff interpretations
thereof.. Therefore, the Sub-Adviser is authorized to place orders
for the purchase and sale of securities for the Fund with such
brokers, subject to review by the Adviser and the Board from time
to time with respect to the extent and continuation of this
practice. It is understood that the services provided by such
brokers may be useful to the Sub-Adviser in connection with its or
its affiliates' services to other clients. In addition, subject to
the Sub-Adviser's obligation to seek the most favorable execution
and net price available, the Sub-Adviser may consider the sale of
the Fund's shares in selecting brokers and dealers.
(c) Aggregated Transactions. On occasions when the Sub-Adviser deems
the purchase or sale of a security to be in the best interest of
the Fund as well as other clients of the Sub-Adviser, the
Sub-Adviser may, to the extent permitted by applicable law and
regulations, aggregate the order for securities to be sold or
purchased in order to obtain the best execution and lower
brokerage commissions, if any. In such event, allocation of the
securities or futures contracts so purchased or sold, as well as
the expenses incurred in the transaction, will be made by the
Sub-Adviser in the manner the Sub-Adviser considers to be the most
equitable and consistent with its fiduciary obligations to the
Fund and to such other clients.
(d) Affiliated Brokers. The Sub-Adviser or any of its affiliates may
act as broker in connection with the purchase or sale of
securities or other investments for the Fund, subject to: (a) the
requirement that the Sub-Adviser seek to obtain best execution and
price within the policy guidelines determined by
A-6
the Board and set forth in the Fund's current prospectus and SAI;
(b) the provisions of the Investment Company Act, the Advisers Act
and the rules of the Commission under such Acts; (c) the
provisions of the 1934 Act; and (d) other provisions of applicable
law. These brokerage services are not within the scope of the
duties of the Sub-Adviser under this Agreement. Subject to the
requirements of applicable law and any procedures adopted by the
Board, the Sub-Adviser or its affiliates may receive brokerage
commissions, fees or other remuneration from the Fund for these
services in addition to the Sub-Adviser's fees for services under
this Agreement.
(e) Alternative Trading Arrangements. From time to time the
Sub-Adviser and the Adviser may agree that the Sub-Advisor will
place some or all of the trades for the Fund through the Adviser's
trading desk. In such event, the Adviser shall have complete
authority to determine the brokers or dealers through which any
trade by the Fund is placed through the Advisers trading desk and
as to the timing and manner of the execution of any such trade,
although the Sub-Adviser may give guidance. In such event, the
Adviser shall be responsible for obtaining best execution on
behalf of the Fund on trades placed by the Adviser and the
Sub-Adviser shall remain responsible for all other compliance
issues in connection with the Fund's portfolio transactions,
including the appropriate and accurate placement of orders on
behalf of the Fund into the Adviser's trading system and
confirming the appropriate settlement of the transactions.
5. Custody. Nothing in this Agreement shall permit the Sub-Adviser to
take or receive physical possession of cash, securities or other
investments of the Fund.
6. Allocation of Charges and Expenses. The Sub-Adviser will bear its own
costs of providing services hereunder. Other than as herein
specifically indicated, the Sub-Adviser shall not be responsible for
the Fund's or the Adviser's expenses, including brokerage and other
expenses incurred in placing orders for the purchase and sale of
securities and other investment instruments. Specifically, the
Sub-Adviser will not be responsible for expenses of the Fund or the
Adviser, as the case may be, including, but not limited to, the
following: (i) charges and expenses for accounting, pricing and
appraisal services and related overhead, including, to the extent such
services are performed by personnel of the Sub-Adviser or its
affiliates, office space and facilities, and personnel compensation,
training and benefits; (ii) the charges and expenses of auditors;
(iii) the charges and expenses of any custodian, transfer agent, plan
agent, dividend disbursing agent and registrar appointed by the Fund;
(iv) underwriting commissions and issue and transfer taxes chargeable
to the Fund in connection with securities transactions to which the
Fund is a party; (v) insurance premiums, interest charges, dues and
fees for membership in trade associations and all taxes and corporate
fees payable by the Fund to federal, state or other governmental
agencies; (vi) fees and expenses involved in registering and
maintaining registrations of the Fund's shares with federal regulatory
agencies, state or blue sky securities agencies and foreign
jurisdictions, including the preparation of
A-7
prospectuses and statements of additional information for filing with
such regulatory authorities; (vii) all expenses of shareholders' and
Board meetings and of preparing, printing and distributing
prospectuses, notices, proxy statements and all reports to
shareholders and to governmental agencies; (viii) charges and expenses
of legal counsel to the Fund and the Board; (ix) any distribution fees
paid by the Fund in accordance with Rule 12b-1 promulgated by the
Commission pursuant to the 1940 Act; (x) compensation and expenses of
the Board; (xi) the cost of preparing and printing share certificates;
(xii) interest on borrowed money, if any; and (xiii) any other expense
that the Fund, the Adviser or any other agent of the Fund may incur
(A) as a result of a change in the law or regulations, (B) as a result
of a mandate from the Board with associated costs of a character
generally assumed by similarly structured investment companies or (C)
that is similar to the expenses listed above, and that is approved by
the Board (including a majority of the Independent Trustees) as being
an appropriate expense of the Fund. The Fund or the Adviser, as the
case may be, shall reimburse the Sub-Adviser for any such expenses or
other expenses of the Fund or the Adviser, as may be reasonably
incurred by such Sub-Adviser on behalf of the Fund or the Adviser. The
Sub-Adviser shall keep and supply to the Fund and the Adviser adequate
records of all such expenses.
7. Representations, Warranties and Covenants.
(a) Properly Licensed. The Sub-Adviser is registered as an investment
adviser under the Advisers Act, and will remain so registered for
the duration of this Agreement. The Sub-Adviser agrees to promptly
notify the Adviser of the occurrence of any event that would
disqualify the Sub-Adviser from serving as an investment adviser
to an investment company. The Sub-Adviser is in compliance in all
material respects with all applicable federal and state law in
connection with its investment management operations.
(b) ADV Disclosure. The Sub-Adviser has provided the Adviser with a
copy of its Form ADV as most recently filed with the SEC and will,
promptly after filing any amendment to its Form ADV with the SEC,
furnish a copy of such amendments to the Adviser. The information
contained in the Sub-Adviser's Form ADV is accurate and complete
in all material respects and does not omit to state any material
fact necessary in order to make the statements made, in light of
the circumstances under which they were made, not misleading.
(c) Fund Disclosure Documents. The Sub-Adviser has reviewed and will
in the future review, the Registration Statement, and any
amendments or supplements thereto, the annual or semi-annual
reports to shareholders, other reports filed with the Commission
and any marketing material of the Fund (collectively the
"Disclosure Documents") and represents and warrants that with
respect to disclosure about the Sub-Adviser, the manner in which
the Fund is managed or information relating directly or indirectly
to the Sub-Adviser, such Disclosure Documents contain or will
contain, as
A-8
of the date thereof, no untrue statement of any material fact and
does not omit any statement of material fact which was required to
be stated therein or necessary to make the statements contained
therein not misleading.
(d) No Statutory Disqualification As An Investment Adviser. The
Sub-Adviser is not prohibited by the Advisers Act or the 1940 Act
from performing the services contemplated by this Agreement, and
to the best knowledge of the Sub-Adviser, there is no proceeding
or investigation that is reasonably likely to result in the
Sub-Adviser being prohibited from performing the services
contemplated by this Agreement.
(e) Use Of The Name "Oak Ridge". The Sub-Adviser has the right to use
the name "Oak Ridge" in connection with its services to the Fund
and that the Adviser and the Fund shall have the right to use the
name "Oak Ridge" in connection with the management and operation
of the Fund and its assets, and that there are no threatened or
existing actions, claims, litigation or proceedings that would
adversely effect or prejudice the rights of the Sub-Adviser,
Adviser or Fund to use the name "Oak Ridge".
(f) Insurance. The Sub-Adviser shall maintain errors and omissions
and fidelity insurance coverage in an amount agreed upon from time
to time by the Adviser and the Sub-adviser and from an insurance
provider that is in the business of regularly providing insurance
coverage to investment advisers. The Sub-Adviser shall provide
prior written notice to the Adviser (i) of any material changes in
its insurance policies or insurance coverage; or (ii) if any
material claims will be made on its insurance policies.
Furthermore, it shall upon request provide to the Adviser any
information it may reasonably require concerning the amount of or
scope of such insurance. The Sub-Adviser's insurance shall, at a
minimum, cover errors and omissions of the Sub-Adviser.
(g) Competent Staff. The Sub-Adviser shall ensure that sufficient and
competent investment management, administrative and compliance
staff experienced in managing accounts similar to the Fund shall
have charge at all times of the conduct of, and shall maintain
close supervision of, the investment and management of the Fund.
For the avoidance of doubt, the Sub-Adviser shall ensure that any
affiliate or third party to whom its duties have been delegated,
shall comply with the foregoing.
(h) No Detrimental Agreement. The Sub-Adviser represents and warrants
that it has no arrangement or understanding with any party, other
than the Fund, that would influence the decision of the
Sub-Adviser with respect to its selection of securities for the
Fund, and that all selections shall be done in accordance with
what is in the best interest of the Fund.
(i) Conflicts. The Sub-Adviser shall act honestly, in good faith and
in the best interests of the Fund including requiring any of its
personnel with knowledge of the Fund's activities to place the
interest of the Fund first,
A-9
ahead of their own interests, in all personal trading scenarios
that may involve a conflict of interest with the Account.
(j) Representations. The representations and warranties in this
Section 7 shall be deemed to be made on the date this Agreement is
executed and at the time of delivery of the monthly compliance
report required by Section 3(a), whether or not specifically
referenced in such certificate.
8. The Name "Oak Ridge". The Sub-Adviser consents to the use by the Fund
of the name "Oak Ridge " as part of the name of the Fund. The
foregoing authorization by the Sub-Adviser to the Fund to use said
name as part of the name of the Fund is not exclusive of the right of
the Sub-Adviser itself to use, or to authorize others to use, the
same; the Fund acknowledges and agrees that as between the Fund and
the Sub-Adviser, the Sub-Adviser has the exclusive right so to use, or
authorize others to use, said name and the Fund agrees to take such
action as may reasonably be requested by the Sub-Adviser to give full
effect to the provisions of this section. Without limiting the
generality of the foregoing, the Fund agrees that, upon any
termination of this Agreement, the Fund will, at the request of the
Sub-Adviser, use its best efforts to change the name of the Fund
within three months of its receipt of the Sub-Adviser's request so as
to eliminate all reference, if any, to the name "Oak Ridge" and will
not thereafter transact any business using the name "Oak Ridge" in the
name of the Fund; provided, however, that the Fund and the Adviser may
continue to use beyond such date any supplies of prospectuses,
marketing materials and similar documents that the Adviser or its
affiliates had on hand at the date of such name change.
9. Sub-Adviser's Compensation. The Adviser shall pay to the Sub-Adviser,
as compensation for the Sub-Adviser's services hereunder, a fee,
determined as described in Schedule A that is attached hereto and made
a part hereof. Such fee shall be computed daily and paid monthly in
arrears by the Adviser. The Fund shall have no responsibility for any
fee payable to the Sub-Adviser. In the event that the fee paid to the
Adviser for managing the Fund is reduced by regulatory authorities or
the Board for any reason whatsoever, the fee hereunder shall be
subject to the same percentage reduction.
The method for determining net assets of the Fund for purposes hereof
shall be the same as the method for determining net assets for purposes of
establishing the offering and redemption prices of Fund shares as described in
the Fund's prospectus. In the event of termination of this Agreement, the fee
provided in this Section shall be computed on the basis of the period ending on
the last business day on which this Agreement is in effect subject to a pro
rata adjustment based on the number of days elapsed in the current month as a
percentage of the total number of days in such month.
10. Independent Contractor. In the performance of its duties hereunder,
the Sub-Adviser is and shall be an independent contractor and, unless
otherwise expressly provided herein or otherwise authorized in
writing, shall have no authority to act for or represent the Fund or
the Adviser in any way or otherwise
A-10
be deemed to be an agent of the Fund or the Adviser. If any occasion
should arise in which the Sub-Adviser gives any advice to its clients
concerning the shares of the Fund, the Sub-Adviser will act solely as
investment counsel for such clients and not in any way on behalf of
the Fund.
11. Assignment and Amendments. This Agreement shall automatically
terminate, without the payment of any penalty, in the event of (i) its
assignment, including any change in control of the Adviser or the
Sub-Adviser, as defined in the 1940 Act, or (ii) in the event of the
termination of the Management Agreement; provided that such
termination shall not relieve the Adviser or the Sub-Adviser of any
liability incurred hereunder.
This Agreement may not be added to or changed orally and may not be
modified or rescinded except by a writing signed by the parties hereto and in
accordance with the 1940 Act, when applicable.
12. Duration and Termination.
(a) This Agreement shall become effective as of the date executed and
shall remain in full force and effect continually thereafter,
subject to renewal as provided in Section 12(d) and unless
terminated automatically as set forth in Section 11 hereof or
until terminated as follows:
(b) The Adviser may at any time terminate this Agreement by not more
than sixty (60) days' nor less than thirty (30) days' written
notice delivered or mailed by registered mail, postage prepaid, to
the Sub-Adviser. In addition, the Fund may cause this Agreement to
terminate either (i) by vote of its Board or (ii) upon the
affirmative vote of a majority of the outstanding voting
securities of the Fund; or
(c) The Sub-Adviser may at any time terminate this Agreement by not
more than sixty (60) days' nor less than thirty (30) days' written
notice delivered or mailed by registered mail, postage prepaid, to
the Adviser; or
(d) This Agreement shall automatically terminate on December 31st of
any year, beginning on December 31, 2005, in which its terms and
renewal shall not have been approved by (A) (i) a majority vote of
the Board or (ii) the affirmative vote of a majority of the
outstanding voting securities of the Fund; provided, however, that
if the continuance of this Agreement is submitted to the
shareholders of the Fund for their approval and such shareholders
fail to approve such continuance of this Agreement as provided
herein, the Sub-Adviser may continue to serve hereunder as to the
Fund in a manner consistent with the 1940 Act and the rules and
regulations thereunder; and (B) a majority vote of the Trustees
who are not "interested persons" (as set forth in the 1940 Act,
subject, however, to such exemptions as may be granted by the
Commission under the 1940 Act) of the Fund, the Adviser or the
Sub-Adviser, at a meeting called for the purpose of voting on such
approval.
A-11
(e) For the purposes of this Agreement, "Affirmative vote of a
majority of the outstanding voting securities of the Fund" shall
have the meaning set forth in the 1940 Act, subject, however, to
such exemptions as may be granted by the Commission under the 1940
Act or any interpretations of the staff of the Commission.
13. Liability of the Sub-Adviser. The Sub-Adviser shall not be liable to
the Adviser Indemnitees (as defined below) for any losses, claims,
damages, liabilities or litigation (including legal and other
expenses) incurred or suffered by an Adviser Indemnitee as a result of
any error of judgment or mistake of law by the Sub-Adviser with
respect to a Fund, except that nothing in this Agreement shall operate
or purport to operate in any way to exculpate, waive or limit the
liability of the Sub-Adviser for, and the Sub-Adviser shall indemnify
and hold harmless the Adviser, the Fund and all affiliated persons
thereof (within the meaning of Section 2(a)(3) of the 1940 Act) and
all controlling persons (as described in Section 15 of the 1933 Act)
(collectively, the "Adviser Indemnitees") against any and all losses,
claims, damages, liabilities or litigation (including reasonable legal
and other expenses) by reason of or arising out of: (a) the
Sub-Adviser being in violation of any applicable federal or state law,
rule or regulation or any investment policy or restriction set forth
in the Fund's Registration Statement or any written guidelines or
instruction provided in writing by the Board or the Adviser, (b) the
Fund's failure to satisfy the diversification or source of income
requirements of Subchapter L or M of the Code by reason of any action
or omission of the Sub-Adviser, unless acting at the direction of the
Adviser, (c) the Sub-Adviser's willful misfeasance, bad faith or gross
negligence generally in the performance of its duties hereunder or its
reckless disregard of its obligations and duties under this Agreement
or (d) the Fund being in violation of any applicable federal or state
law, rule or regulation or any investment policy or restriction set
forth in the Fund's Registration Statement or any written guidelines
or instruction provided in writing by the Board or the Adviser, by
reason of any action or omission of the Sub-Adviser.
14. Enforceability. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the
remaining terms or provisions of this Agreement or affecting the
validity or enforceability of any of the terms or provisions of this
Agreement in any other jurisdiction.
15. Limitation of Liability. The parties to this Agreement acknowledge and
agree that all litigation arising hereunder, whether direct or
indirect, and of any and every nature whatsoever shall be satisfied
solely out of the assets of the Fund and that no Trustee, officer or
holder of shares of beneficial interest of the Fund shall be
personally liable for any of the foregoing liabilities. The Fund's
Certificate of Trust, as amended from time to time, is on file in the
Office of the Secretary of State of the State of Delaware. Such
Certificate of Trust and the Fund's Agreement and Declaration of Trust
describe in detail the respective
A-12
responsibilities and limitations on liability of the Trustees,
officers, and holders of shares of beneficial interest.
16. Jurisdiction. This Agreement shall be governed by and construed in
accordance with the substantive laws of The Commonwealth of
Massachusetts and the Sub-Adviser consents to the jurisdiction of
courts, both state or federal, in Boston, Massachusetts, with respect
to any dispute under this Agreement.
17. Paragraph Headings. The headings of paragraphs contained in this
Agreement are provided for convenience only. The form no part of this
Agreement and shall not affect its construction.
18. Counterparts. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
signed on their behalf by their duly authorized officers as of the date first
above written.
ATTEST: PIONEER INVESTMENT MANAGEMENT, INC.
- --------------------------- By: ------------------------------------------
Name: Mark D. Goodwin
Title: Chief Financial Officer
ATTEST: OAK RIDGE INVESTMENTS, LLC
- --------------------------- By: ------------------------------------------
Alan E Molby Name: David Klaskin
Title: Chairman
Accepted and agreed to as of the day and year first above written.
A-13
SCHEDULE A
The Adviser will pay to the Sub-Adviser as compensation for the
Sub-Adviser's services rendered, a fee, computed daily and payable at the end
of each month at an annual rate based on the average daily net assets of the
Fund under the following fee schedule:
Assets Rate
- --------------------------------------------------------------------------- ----------
First $250 Million..................................................... 0.45%
Greater than $250 Million and less than or equal to $500 Million....... 0.40%
Greater than $500 Million and less than or equal to $750 Million....... 0.35%
Greater than $750 Million.............................................. 0.30%
A-14
EXHIBIT B
Additional information pertaining to Oak Ridge
Oak Ridge is a limited liability company organized under the laws of
Delaware. David Klaskin, Samuel Wegbreit, Richard O. Klaskin, Mary Edman, John
and Bonnie Vainder, Robert G. McVicker, III, Susan McVicker Collins, Alan E.
Molotsky, and John Peter collectively own 100% of the interests in Oak Ridge,
with David Klaskin and Samuel Wegbreit owning controlling interests. Oak Ridge
is located at 10 South LaSalle Street, Suite 1250, Chicago, Illinois 60603,
which is also the address for Oak Ridge's owners, directors and officers.
Directors and officers of Oak Ridge:
Name Title Principal Occupation
- -------------------------- --------------------------- ---------------------
Samuel Wegbreit .......... Director, Chairman and Same
Secretary
David Klaskin ............ Director, Chief Executive Same
Officer and Treasurer
John Peter ............... President Same
None of the trustees or officers of the Trust is also an officer, employee
or director of Oak Ridge.
None of the officers or trustees of the Trust have had any material direct
or indirect interest in Oak Ridge or any other person controlling, controlled
by or under common control with Oak Ridge. In addition, no trustee has had any
direct or indirect material interest in any transaction (or proposed
transaction) since the inception of the portfolio to which Oak Ridge or its
affiliates are parties.
Similar funds managed by Oak Ridge
Oak Ridge serves as the investment adviser to the following funds with
investment objectives similar to your portfolio's objective.
Management fee rate for
Net assets of similar fund similar fund as a percentage
Similar fund as of October 31, 2004 of average daily net assets
- ----------------------------------------- ---------------------------- -----------------------------
Pioneer Oak Ridge Large Cap $59,809,993 0.75% up to $1 billion
Growth Fund and 0.70% on assets over
$1 billion
Affiliated brokerage
No brokerage commissions have been paid by the portfolio since its
inception to any broker affiliated with Oak Ridge.
B-1
PROXY PROXY
PROXY FOR THE SPECIAL MEETING OF SHAREHOLDERS OF
PIONEER OAK RIDGE LARGE CAP GROWTH VCT PORTFOLIO
To be held December 28, 2004
I (we), having received notice of the meeting and management's proxy statement
therefor, and revoking all prior proxies, hereby appoint John F. Cogan, Jr.,
Dorothy E. Bourassa, John A. Carey and David C. Phelan, and each of them, my
(our) attorneys (with full power of substitution in them and each of them) for
and in my (our) name(s) to attend the Special Meeting of Shareholders of my
(our) Portfolio to be held on December 28, 2004, at 2:00 p.m. (Boston time) at
the offices of Wilmer Cutler Pickering Hale and Dorr LLP, counsel to the
Portfolio, 60 State Street, 26th Floor, Boston, Massachusetts 02109, and any
adjourned session or sessions thereof, and thereto vote and act upon the
following matters (as more fully described in the accompanying proxy statement)
in respect of all shares of the Portfolio which I (we) will be entitled to vote
or act upon, with all the powers I (we) would possess if personally present.
IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER BUSINESS
AS MAY PROPERLY COME BEFORE THE MEETING. THE SHARES REPRESENTED BY THIS PROXY
WILL BE VOTED AS DIRECTED BY THE UNDERSIGNED. If this proxy is executed but no
instruction is given, the votes entitled to be cast by the undersigned will be
cast "FOR" the proposal as described in the Proxy Statement.
999 9999 9999 999
NOTE: In signing, please write name(s) exactly as appearing hereon.
When signing as attorney, executor, administrator or other fiduciary,
please give your full title as such. Joint owners should each sign personally.
- --------------------------------------------------------------------------------
Signature
- --------------------------------------------------------------------------------
Signature of joint owner, if any
- --------------------------------------------------------------------------------
Date PVT_14747
PLEASE RETURN YOUR SIGNED PROXY CARD IN THE ENCLOSED ENVELOPE
THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES OF YOUR PORTFOLIO AND SHOULD BE
RETURNED AS SOON AS POSSIBLE IN THE ENVELOPE PROVIDED. THE BOARD RECOMMENDS THAT
YOU VOTE IN FAVOR OF THE FOLLOWING PROPOSAL:
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK. EXAMPLE:
1. To approve a subadvisory agreement between Pioneer Investment
Management, Inc. and Oak Ridge Investments, LLC.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
To consider any other business that may properly come before the
meeting.
PLEASE SIGN, DATE AND RETURN THIS PROXY CARD
PVT_14747