CLASS B SHARES DISTRIBUTION PLAN
PIONEER CULLEN VALUE FUND
CLASS B SHARES DISTRIBUTION PLAN, dated as of ___________, 2005 of PIONEER
CULLEN VALUE FUND (the "Fund"), a series of Pioneer Series Trust III, a Delaware
statutory trust, (the "Trust").
WITNESSETH
WHEREAS, the Trust is engaged in business as an open-end, management
investment company and is registered under the Investment Company Act of 1940,
as amended (collectively with the rules and regulations promulgated thereunder,
the "1940 Act");
WHEREAS, the Trust intends to distribute shares of beneficial interest (the
"Class B Shares") of the Fund in accordance with Rule 12b-1 promulgated by the
Securities and Exchange Commission under the 1940 Act ("Rule 12b-1"), and
desires to adopt this Class B Shares distribution plan (the "Class B Plan") as a
plan of distribution pursuant to Rule 12b-1;
WHEREAS, the Trust desires that Pioneer Funds Distributor, Inc., a
Massachusetts corporation ("PFD") or such other persons as may be appointed
principal underwriter from time to time, provide certain distribution services
for the Fund's Class B Shares in connection with the Class B Plan (PFD and any
successor principal underwriter of the Trust's shares being referred to as an
"Underwriter");
WHEREAS, the Trust on behalf of the Fund has entered into an underwriting
agreement (in a form approved by the Trust's Board of Trustees in a manner
specified in Rule 12b-1) with the Underwriter, whereby the Underwriter provides
facilities and personnel and renders services to the Trust in connection with
the offering and distribution of the Fund's Class B Shares (the "Underwriting
Agreement");
WHEREAS, the Trust also recognizes and agrees that (a) the Underwriter may
retain the services of firms or individuals to act as dealers or wholesalers
(collectively, the "Dealers") of the Class B Shares in connection with the
offering of Class B Shares, (b) the Underwriter may compensate any Dealer that
sells Class B Shares in the manner and at the rate or rates to be set forth in
an agreement between the Underwriter and such Dealer and (c) the Underwriter may
make such payments to the Dealers for distribution services out of the fee paid
to the Underwriter hereunder, any deferred sales charges imposed by the
Underwriter in connection with the repurchase of Class B Shares, its profits or
any other source available to it;
WHEREAS, the Trust recognizes and agrees that the Underwriter may impose
certain deferred sales charges in connection with the repurchase of Class B
Shares by the Trust, and the Underwriter may retain (or receive from the Trust,
as the case may be) all such deferred sales charges; and
WHEREAS, the Board of Trustees of the Trust, in considering whether the
Fund should adopt and implement this Class B Plan, has evaluated such
information as it deemed necessary to an informed determination whether this
Class B Plan should be adopted and implemented and has considered such pertinent
factors as it deemed necessary to form the basis for a decision to use assets of
the Trust for such purposes, and has determined that there is a reasonable
likelihood that the adoption and implementation of this Class B Plan will
benefit the Fund and its Class B shareholders;
NOW, THEREFORE, the Board of Trustees of the Trust hereby adopts this Class
B Plan for the Fund as a plan of distribution of Class B Shares in accordance
with Rule 12b-1, on the following terms and conditions:
1. (a) The Fund is authorized to compensate the Underwriter for (1)
distribution services and (2) personal and account maintenance services
performed and expenses incurred by the Underwriter in connection with the
Fund's Class B Shares. Such compensation shall be calculated and accrued
daily and paid monthly or at such other intervals as the Board of Trustees
may determine.
(b) The amount of compensation payable to the Underwriter during any
one (1) year for distribution services with respect to Class B Shares shall
be its Allocable Portion (as defined in Section 14 below) of 0.75% of the
Fund's average daily net assets attributable to Class B Shares for such
year (the "Distribution Fee"). Notwithstanding anything to the contrary set
forth in this Class B Plan or any Underwriting Agreement, the Distribution
Fee shall not be terminated or modified (including a modification by change
in the rules relating to the conversion of Class B Shares into Class A
shares of the Fund) with respect to Class B shares (or the assets of the
Fund attributable to such Class B Shares) either (x) issued prior to the
date of any termination or modification or (y) attributable to Class B
shares issued through one or a series of exchanges of shares of another
investment company for which the Underwriter acts as principal underwriter
which were initially issued prior to the date of such termination or
modification or (z) issued as a dividend or distribution upon Class B
Shares initially issued or attributable to Class B Shares issued prior to
the date of any such termination or modification (the "Pre-Amendment Class
B Shares") except:
(i) to the extent required by a change in the 1940 Act, the rules
or regulations under the 1940 Act, the Conduct Rules of the National
Association of Securities Dealers, Inc., (the "NASD") or an order of
any court or governmental agency, in each case enacted, issued or
promulgated after September 30, 1998,
(ii) in connection with a "Complete Termination" of this Class B
Plan. For purposes of this Class B Plan, a "Complete Termination"
shall have occurred if: (x) this Class B Plan and the distribution
plan for Class B Shares of any successor trust or fund or any trust or
fund acquiring substantially all of the assets of the Fund
(collectively, the "Affected Funds") is terminated with respect to all
Class B Shares of the Fund and each Affected Fund then outstanding or
subsequently issued, (y) the payment by the Trust of Distribution Fees
with respect to all Class B Shares of the Fund and each Affected Fund
is terminated
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and (z) neither the Fund nor any Affected Fund establishes
concurrently with or subsequent to such termination of this Class B
Plan another class of shares which has substantially similar
characteristics to the current Class B Shares of the Fund, including
the manner of payment and amount of contingent deferred sales charge
paid directly or indirectly by the holders of such shares (all of such
classes of shares "Class B Shares"), or
(iii) on a basis, determined by the Board of Trustees, including
a majority of the Qualified Trustees (as hereinafter defined), acting
in good faith, so long as from and after the effective date of such
modification or termination: (x) neither (1) the Fund, (2) any
Affected Fund nor (3) the investment advisor or any other sponsor
entity (or their affiliates) of the Trust or any Affected Fund pay,
directly or indirectly, a fee, a trailer fee, or expense reimbursement
to any person for the provision of personal and account maintenance
services (as such terms are used in the Conduct Rules of the NASD) to
the holder of Class B Shares of the Fund or any Affected Fund (but the
forgoing shall not prevent payments for transfer agency or
subaccounting services), and (y) the termination or modification of
the Distribution Fee applies with equal effect to both Pre-Amendment
Class B Shares and Post-Amendment Class B Shares (as defined in
Section 7) outstanding from time to time of the Fund and all Affected
Funds.
(c) Distribution services and expenses for which an Underwriter may be
compensated pursuant to this Class B Plan include, without limitation:
compensation to and expenses (including allocable overhead, travel and telephone
expenses) of (i) Dealers, brokers and other dealers who are members of the NASD
or their officers, sales representatives and employees, (ii) the Underwriter and
any of its affiliates and any of their respective officers, sales
representatives and employees, (iii) banks and their officers, sales
representatives and employees, who engage in or support distribution of the
Fund's Class B Shares; printing of reports and prospectuses for other than
existing shareholders; and preparation, printing and distribution of sales
literature and advertising materials.
(d) The Underwriter shall be deemed to have performed all services required
to be performed in order to be entitled to receive its Allocable Portion of the
Distribution Fee, if any, payable with respect to Class B Shares sold through
such Underwriter upon the settlement date of the sale of such Class B Share or
in the case of Class B Shares issued through one or a series of exchanges of
shares of another investment company for which the Underwriter acts as principal
underwriter or issued as a dividend or distribution upon Class B Shares, on the
settlement date of the first sale on a commission basis of a Class B Share from
which such Class B share was derived. The Fund's obligation to pay an
Underwriter its Allocable Portion of the Distribution Fees payable in respect of
the Class B Shares shall be absolute and unconditional and shall not be subject
to dispute, offset, counterclaim or any defense whatsoever, at law or equity,
including, without limitation, any of the foregoing based on the insolvency or
bankruptcy of such Underwriter. The foregoing provisions of this Section 1(d)
shall not limit the rights of the Fund to modify or terminate payments under
this Class B Plan as provided in Section 1(b) with respect to Pre-Amendment
Class B Shares or Section 7 with respect to Post-Amendment Class B Shares.
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(e) The amount of compensation paid during any one (1) year for personal
and account maintenance services and expenses shall be 0.25% of the Fund's
average daily net assets attributable to Class B Shares for such year. As
partial consideration for personal services and/or account maintenance services
provided by the Underwriter to the Class B Shares, the Underwriter shall be
entitled to be paid any fees payable under this clause (e) with respect to Class
B Shares for which no dealer of record exists, where less than all consideration
has been paid to a dealer of record or where qualification standards have not
been met. (f) Personal and account maintenance services for which the
Underwriter or any of its affiliates, banks or Dealers may be compensated
pursuant to this Class B Plan include, without limitation: payments made to or
on account of the Underwriter or any of its affiliates, banks, other brokers and
dealers who are members of the NASD, or their officers, sales representatives
and employees, who respond to inquiries of, and furnish assistance to,
shareholders regarding their ownership of Class B Shares or their accounts or
who provide similar services not otherwise provided by or on behalf of the Fund.
(g) The Underwriter may impose certain deferred sales charges in connection
with the repurchase of Class B Shares by the Fund and the Underwriter may retain
(or receive from the Fund as the case may be) all such deferred sales charges.
(h) The Trust has agreed in the Underwriting Agreement to certain
restrictions on the Fund's ability to modify or waive certain terms of the
Fund's Class B Shares or the contingent deferred sales charge with respect to
Pre-Amendment Class B Shares.
(i) Appropriate adjustments to payments made pursuant to clauses (b) and
(d) of this paragraph 1 shall be made whenever necessary to ensure that no
payment is made by the Trust in excess of the applicable maximum cap imposed on
asset based, front-end and deferred sales charges by Section 2830(d) of the
Conduct Rules of the NASD.
2. The Fund understands that agreements between the Underwriter and Dealers
may provide for payment of fees to Dealers in connection with the sale of Class
B Shares and the provision of services to shareholders of the Fund. Nothing in
this Class B Plan shall be construed as requiring the Trust to make any payment
to any Dealer or to have any obligations to any Dealer in connection with
services as a dealer of the Class B Shares. The Underwriter shall agree and
undertake that any agreement entered into between the Underwriter and any Dealer
shall provide that such Dealer shall look solely to the Underwriter for
compensation for its services thereunder and that in no event shall such Dealer
seek any payment from the Fund.
3. Notwithstanding anything to the contrary in this Class B Plan or any
Underwriting Agreement, the Underwriter may assign, sell or pledge
(collectively, "Transfer") its rights to its Allocable Portion of any
Distribution Fees under this Class B Plan. Upon receipt of notice of such
Transfer, the Trust shall pay to the assignee, purchaser or pledgee
(collectively with their subsequent transferees, "Transferees"), as third party
beneficiaries, such portion of the Distribution Fees payable to the Underwriter
as provided in written instructions (the "Allocation Instructions") from the
Underwriter and said Transferee to the Trust. In the absence of Allocation
Instructions, the Trust shall have no obligations to a Transferee.
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4. Nothing herein contained shall be deemed to require the Trust to take
any action contrary to its Agreement and Declaration of Trust, as it may be
amended or restated from time to time, or By-Laws or any applicable statutory or
regulatory requirement to which it is subject or by which it is bound, or to
relieve or deprive the Trust's Board of Trustees of the responsibility for and
control of the conduct of the affairs of the Trust; it being understood that
actions taken pursuant to Section 1(b) shall not be considered such an action
described above.
5. This Class B Plan shall become effective upon approval by a vote of the
Board of Trustees, including a majority of the Trustees who are not "interested
persons" of the Trust and who have no direct or indirect financial interest in
the operation of the Class B Plan or in any agreements related to the Class B
Plan (the "Qualified Trustees"), such votes to be cast in person at a meeting
called for the purpose of voting on this Class B Plan.
6. All of the terms of this Class B Plan are intended to apply in respect
of all Pre-Amendment Class B Shares and to the Distribution Fees payable in
respect of any thereof. This Class B Plan will remain in effect indefinitely,
provided that such continuance is "specifically approved at least annually" by a
vote of both a majority of the Trustees of the Trust and a majority of the
Qualified Trustees. If such annual approval is not obtained, this Class B Plan
shall expire on the annual anniversary of the adoption of this Class B Plan
following the last such approval.
7. Subject to the limitation set forth in Section 1(b) with respect to
Pre-Amendment Class B shares, this Class B Plan may be amended at any time by
the Board of Trustees with respect to Class B Shares (and the assets
attributable to such Class B Shares) which are not Pre-Amendment Class B Shares
("Post-Amendment Class B Shares"); provided that this Class B Plan may not be
amended to increase materially the limitations on the annual percentage of
average net assets which may be expended hereunder without the approval of
holders of a "majority of the outstanding voting securities" of Class B of the
Fund and may not be materially amended in any case without a vote of a majority
of both the Trustees and the Qualified Trustees. This Class B Plan may be
terminated at any time, subject to Section 1(b), by a vote of a majority of the
Qualified Trustees or by a vote of the holders of a "majority of the outstanding
voting securities" of Class B of the Fund.
8. The Trust and the Underwriter shall provide to the Trust's Board of
Trustees, and the Board of Trustees shall review, at least quarterly, a written
report of the amounts expended under this Class B Plan and the purposes for
which such expenditures were made.
9. While this Class B Plan is in effect, the selection and nomination of
Qualified Trustees shall be committed to the discretion of the Trustees who are
not "interested persons" of the Trust.
10. For the purposes of this Class B Plan, the terms "interested persons,"
"majority of the outstanding voting securities" and "specifically approved at
least annually" are used as defined in the 1940 Act.
11. The Trust shall preserve copies of this Class B Plan, and each
agreement related hereto and each report referred to in Paragraph 8 hereof
(collectively, the "Records"), for a
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period of not less than six (6) years from the end of the fiscal year in which
such Records were made and, for a period of two (2) years, each of such Records
shall be kept in an easily accessible place.
12. This Class B Plan shall be construed in accordance with the laws of The
Commonwealth of Massachusetts and the applicable provisions of the 1940 Act.
13. If any provision of this Class B Plan shall be held or made invalid by
a court decision, statute, rule or otherwise, the remainder of the Class B Plan
shall not be affected thereby.
14. Payments under this Class B Plan shall be allocated between PFD and any
successor Underwriter or co-Underwriter (each an Underwriter's "Allocable
Portion") as provided in the Allocation Procedures appended hereto.
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