FORM OF
SUBADVISORY AGREEMENT
TEMPLETON GLOBAL INVESTMENT TRUST
(on behalf of
Franklin Xxxxxxxxx Non-U.S. Dynamic Core Equity Fund)
THIS SUBADVISORY AGREEMENT made as of the 25th day of February, 2003 by
and between FRANKLIN XXXXXXXXX ASSET STRATEGIES, LLC, a Delaware limited
liability company (hereinafter called "FTAS") and XXXXXXXXX INVESTMENT COUNSEL,
LLC, a Delaware limited liability company (hereinafter called "TIC, LLC").
W I T N E S S E T H
WHEREAS, FTAS and TIC, LLC are each registered as an investment adviser
under the Investment Advisers Act of 1940 (the "Advisers Act"), and engaged in
the business of supplying investment advice, and investment management services,
as an independent contractor; and
WHEREAS, FTAS has been retained to render investment advisory services
to the Franklin Xxxxxxxxx Non-U.S. Dynamic Core Equity Fund (the "Fund"), a
series of Templeton Global Investment Trust (the "Trust"), an investment
management company registered with the U.S. Securities and Exchange Commission
(the "SEC") pursuant to the Investment Company Act of 1940 (the "1940 Act"); and
WHEREAS, FTAS desires to retain TIC, LLC to render investment advisory,
research and related services to the Fund pursuant to the terms and provisions
of this Agreement, and TIC, LLC is interested in furnishing said services.
NOW, THEREFORE, in consideration of the covenants and the mutual
promises hereinafter set forth, the parties hereto, intending to be legally
bound hereby, mutually agree as follows:
1. FTAS hereby retains TIC, LLC and TIC, LLC hereby accepts such
engagement, to furnish certain investment advisory services with respect to the
assets of the Fund, as more fully set forth herein.
(a) Subject to the overall policies, control, direction
and review of the Trust's Board of Trustees (the "Board") and to the
instructions and supervision of FTAS, TIC, LLC will provide a continuous
investment program for the Fund with respect to that portion of the Fund's
assets designated by FTAS, including allocation of the Fund's assets among the
various securities markets of the world and, investment research and advice with
respect to securities and investments and cash equivalents in the Fund. So long
as the Board and FTAS determine, on no less frequently than an annual basis, to
grant the necessary delegated authority to TIC, LLC, and subject to paragraph
(b) below, TIC, LLC will, with respect to the portion of the Fund's assets over
which it has been given responsibility, determine what securities and other
investments will be purchased, retained or sold by the Fund, and will place all
purchase and sale orders on behalf of the Fund.
(b) In performing these services, TIC, LLC shall adhere to
the Fund's investment objectives, policies and restrictions as contained in
its Prospectus and Statement of Additional Information, and in the Trust's
Declaration of Trust, and to the investment guidelines most recently established
by FTAS and shall comply with the provisions of the 1940 Act and the rules and
regulations of the SEC thereunder in all material respects and with the
provisions of the United States Internal Revenue Code of 1986, as amended, which
are applicable to regulated investment companies.
(c) Unless otherwise instructed by FTAS or the Board, and
subject to the provisions of this Agreement and to any guidelines or limitations
specified from time to time by FTAS or by the Board, TIC, LLC shall report daily
all transactions effected by TIC, LLC on behalf of the Fund to FTAS and to other
entities as reasonably directed by FTAS or the Board.
(d) TIC, LLC shall provide the Board at least quarterly, in
advance of the regular meetings of the Board, a report of its activities
hereunder on behalf of the Fund and its proposed strategy for the next quarter,
all in such form and detail as requested by the Board. TIC, LLC shall also make
an investment officer available to attend such meetings of the Board as the
Board may reasonably request.
(e) In carrying out its duties hereunder, TIC, LLC shall
comply with all reasonable instructions of the Fund or FTAS in connection
therewith. Such instructions may be given by letter, telex, telefax or telephone
confirmed by telex, by the Board or by any other person authorized by a
resolution of the Board, provided a certified copy of such resolution has been
supplied to TIC, LLC.
2. In performing the services described above, TIC, LLC shall use
its best efforts to obtain for the Fund the most favorable price and
execution available. Subject to prior authorization of appropriate policies and
procedures by the Board, TIC, LLC may, to the extent authorized by law and in
accordance with the terms of the Fund's Prospectus and Statement of Additional
Information, cause the Fund to pay a broker who provides brokerage and research
services an amount of commission for effecting a portfolio investment
transaction in excess of the amount of commission another broker would have
charged for effecting that transaction, in recognition of the brokerage and
research services provided by the broker. To the extent authorized by applicable
law, TIC, LLC shall not be deemed to have acted unlawfully or to have breached
any duty created by this Agreement or otherwise solely by reason of such action.
3. (a) TIC, LLC shall, unless otherwise expressly provided and
authorized, have no authority to act for or represent FTAS or the Fund in any
way, or in any way be deemed an agent for FTAS or the Fund.
(b) It is understood that the services provided by TIC, LLC
are not to be deemed exclusive. FTAS acknowledges that TIC, LLC may have
investment responsibilities, or render investment advice to, or perform other
investment advisory services, for individuals or entities, including other
investment companies registered pursuant to the 1940 Act, ("Clients") which may
invest in the same type of securities as the Fund. FTAS agrees that TIC, LLC may
give advice or exercise investment responsibility and take such other action
with respect to such Clients which may differ from advice given or the timing or
nature of action taken with respect to the Fund.
4. TIC, LLC agrees to use its best efforts in performing the services
to be provided by it pursuant to this Agreement.
5. FTAS has furnished or will furnish to TIC, LLC as soon as
available copies properly certified or authenticated of each of the following
documents:
(a) the Trust's Trust Instrument dated December 21, 1993,
and any other organizational documents and all amendments thereto or
restatements thereof;
(b) resolutions of the Trust's Board of Trustees
authorizing the appointment of TIC, LLC and approving this Agreement;
(c) the Trust's original Notification of Registration on
Form N-8A under the 1940 Act as filed with the SEC and all amendments thereto;
(d) the Trust's current Registration Statement on Form N-1A
under the Securities Act of 1933, as amended and under the 1940 Act as filed
with the SEC, and all amendments thereto, as it relates to the Fund;
(e) the Fund's most recent Prospectus and Statement of
Additional Information; and
(f) the Investment Advisory Agreement between the Fund
and FTAS.
FTAS will furnish TIC, LLC with copies of all amendments of or supplements to
the foregoing documents.
6. TIC, LLC will treat confidentially and as proprietary
information of the Fund all records and other information relative to the Fund
and prior, present or potential shareholders, and will not use such records and
information for any purpose other than performance of its responsibilities and
duties hereunder, except after prior notification to and approval in writing by
the Fund, which approval shall not be unreasonably withheld and may not be
withheld where TIC, LLC may be exposed to civil or criminal contempt proceedings
for failure to comply when requested to divulge such information by duly
constituted authorities, or when so requested by the Fund.
7. (a) FTAS shall pay a monthly fee in cash to TIC, LLC of one-half
(1/2)of the investment advisory fee paid to FTAS by the Fund, which fee shall
be payable on the first business day of each month in each year as compensation
for the services rendered and obligations assumed by TIC, LLC during the
preceding month. The advisory fee under this Agreement shall be payable on the
first business day of the first month following the effective date of this
Agreement, and shall be reduced by the amount of any advance payments made by
FTAS relating to the previous month.
(b) FTAS and TIC, LLC shall share equally in any voluntary
reduction or waiver by FTAS of the management fee due FTAS under the Investment
Advisory Agreement between FTAS and the Fund.
(c) If this Agreement is terminated prior to the end of any
month, the monthly fee shall be prorated for the portion of any month in which
this Agreement is in effect which is not a complete month according to the
proportion which the number of calendar days in the month during which the
Agreement is in effect bears to the total number of calendar days in the month,
and shall be payable within 10 days after the date of termination.
8. Nothing herein contained shall be deemed to relieve or deprive
the Board of its responsibility for and control of the conduct of the affairs
of the Fund.
9. (a) In the absence of willful misfeasance, bad faith, gross
negligence, or reckless disregard of its obligations or duties hereunder on the
part of TIC, LLC, neither TIC, LLC nor any of its directors, officers, employees
or affiliates shall be subject to liability to FTAS or the Fund or to any
shareholder of the Fund for any error of judgment or mistake of law or any other
act or omission in the course of, or connected with, rendering services
hereunder or for any losses that may be sustained in the purchase, holding or
sale of any security by the Fund.
(b) Notwithstanding paragraph 9(a), to the extent that FTAS
is found by a court of competent jurisdiction, or the SEC or any other
regulatory agency to be liable to the Fund or any shareholder (a "liability"),
for any acts undertaken by TIC, LLC pursuant to authority delegated as described
in Paragraph 1(a), TIC, LLC shall indemnify and save FTAS and each of its
affiliates, officers, directors and employees (each an "Indemnified Party")
harmless from, against, for and in respect of all losses, damages, costs and
expenses incurred by an Indemnified Party with respect to such liability,
together with all legal and other expenses reasonably incurred by any such
Indemnified Party, in connection with such liability.
(c) No provision of this Agreement shall be construed to
protect any director or officer of FTAS or TIC, LLC, from liability in
violation of Sections 17(h) or (i), respectively, of the 0000 Xxx.
10. During the term of this Agreement, TIC, LLC will pay all
expenses incurred by it in connection with its activities under this Agreement
other than the cost of securities (including brokerage commissions, if any)
purchased for the Fund. The Fund and FTAS will be responsible for all of their
respective expenses and liabilities.
11. This Agreement shall be effective as of the date given avove,
and shall continue in effect for two years. It is renewable annually thereafter
for successive periods not to exceed one year each (i) by a vote of the Board
or by the vote of a majority of the outstanding voting securities of
the Fund, and (ii) by the vote of a majority of the Trustees of the Trust who
are not parties to this Agreement or interested persons thereof, cast in person
at a meeting called for the purpose of voting on such approval.
12. This Agreement may be terminated at any time, without payment of
any penalty, by the Board or by vote of a majority of the outstanding voting
securities of the Fund, upon sixty (60) days' written notice to FTAS and
TIC, LLC, and by FTAS or TIC, LLC upon sixty (60) days' written notice to the
other party.
13. This Agreement shall terminate automatically in the event of any
transfer or assignment thereof, as defined in the 1940 Act, and in the event
of any act or event that terminates the Investment Advisory Agreement between
FTAS and the Fund.
14. In compliance with the requirements of Rule 31a-3 under the 1940
Act, TIC, LLC hereby agrees that all records which it maintains for the Fund
are the property of the Fund and further agrees to surrender promptly to the
Fund, or to any third party at the Fund's direction, any of such records upon
the Fund's request. TIC, LLC further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act.
15. This Agreement may not be materially amended, transferred,
assigned, sold or in any manner hypothecated or pledged without the affirmative
vote or written consent of the holders of a majority of the outstanding voting
securities of the Fund and may not be amended without the written consent of
FTAS and TIC, LLC.
16. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule, or otherwise, the remainder of this
Agreement shall not be affected thereby.
17. The terms "majority of the outstanding voting securities" of
the Fund and "interested persons" shall have the meanings as set forth in the
1940 Act.
18. This Agreement shall be interpreted in accordance with and
governed by the laws of the State of Florida of the United States of America.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested by their duly authorized officers.
FRANKLIN XXXXXXXXX ASSET STRATEGIES, LLC
By: ______________________________
Xxxxx X. Xxxxxxx
Title: Vice President
XXXXXXXXX INVESTMENT COUNSEL, LLC
By: ______________________________
Xxxxxxx X. XxXxxxx
Title: Executive Vice President
Franklin Xxxxxxxxx Non-U.S. Dynamic Core Equity Fund hereby acknowledges and
agrees to the provisions of paragraphs 9(a) and 10 of this Agreement.
Templeton Global Investment Trust, on behalf of
Franklin Xxxxxxxxx Non-U.S. Dynamic Core Equity Fund
By:______________________________
Xxxxx X. Xxxx
Title: Vice President and Assistant Secretary
