SUBCONTRACT FOR FUND ADMINISTRATIVE SERVICES
This Subcontract for Fund Administrative Services ("Subcontract")
is made as of July 2, 2007 between FRANKLIN ADVISERS, INC., a California
corporation, hereinafter called the "Investment Manager," and FRANKLIN
XXXXXXXXX SERVICES, LLC (the "Administrator").
In consideration of the mutual agreements herein made, the
Administrator and the Investment Manager understand and agree as follows:
I. Prime Contract.
This Subcontract is made in order to assist the Investment Manager in
fulfilling certain of the Investment Manager's obligations under each
investment management and investment advisory agreement ("Agreement") between
the Investment Manager and each Investment Company listed on Exhibit A,
("Investment Company") for itself or on behalf of each of its series listed on
Exhibit A (each, a "Fund"). This Subcontract is subject to the terms of each
Agreement, which is incorporated herein by reference.
II. Subcontractual Provisions.
(1) The Administrator agrees, during the life of this Agreement, to
provide the following services to each Fund:
(a) providing office space, telephone, office equipment and
supplies for the Fund;
(b) providing trading desk facilities for the Fund, unless these
facilities are provided by the Fund's investment adviser;
(c) authorizing expenditures and approving bills for payment on
behalf of the Fund;
(d) supervising preparation of periodic reports to shareholders,
notices of dividends, capital gains distributions and tax credits; and
attending to routine correspondence and other communications with individual
shareholders when asked to do so by the Fund's shareholder servicing agent or
other agents of the Fund;
(e) coordinating the daily pricing of the Fund's investment
portfolio, including collecting quotations from pricing services engaged by
the Fund; providing fund accounting services, including preparing and
supervising publication of daily net asset value quotations, periodic
earnings reports and other financial data; and coordinating trade settlements;
(f) monitoring relationships with organizations serving the Fund,
including custodians, transfer agents, public accounting firms, law firms,
printers and other third party service providers;
(g) supervising compliance by the Fund with recordkeeping
requirements under the federal securities laws, including the 1940 Act and
the rules and regulations thereunder, and under other applicable state and
federal laws; and maintaining books and records for the Fund (other than
those maintained by the custodian and transfer agent);
(h) preparing and filing of tax reports including the Fund's
income tax returns, and monitoring the Fund's compliance with subchapter M of
the Internal Revenue Code, as amended, and other applicable tax laws and
regulations;
(i) monitoring the Fund's compliance with: 1940 Act and other
federal securities laws, and rules and regulations thereunder; state and
foreign laws and regulations applicable to the operation of investment
companies; the Fund's investment objectives, policies and restrictions; and
the Code of Ethics and other policies adopted by the Investment Company's
Board of Trustees or Directors ("Board") or by the Fund's investment adviser
and applicable to the Fund;
(j) providing executive, clerical and secretarial personnel needed
to carry out the above responsibilities;
(k) preparing and filing regulatory reports, including without
limitation Forms N-1A and NSAR, proxy statements, information statements and
U.S. and foreign ownership reports; and
(l) providing support services incidental to carrying out these
duties.
Nothing in this Agreement shall obligate the Investment Company or any Fund
to pay any compensation to the officers of the Investment Company. Nothing
in this Agreement shall obligate the Administrator to pay for the services of
third parties, including attorneys, auditors, printers, pricing services or
others, engaged directly by the Fund to perform services on behalf of the
Fund.
(2) The Investment Manager agrees to pay to the Administrator as
compensation for such services a monthly fee equal on an annual basis to
0.15% of the first $200 million of the average daily net assets of each Fund
during the month preceding each payment, reduced as follows: on such net
assets in excess of $200 million up to $700 million, a monthly fee equal on
an annual basis to 0.135%; on such net assets in excess of $700 million up to
$1.2 billion, a monthly fee equal on an annual basis to 0.1%; and on such net
assets in excess of $1.2 billion, a monthly fee equal on an annual basis to
0.075%.
From time to time, the Administrator may waive all or a portion of its fees
provided for hereunder and such waiver shall be treated as a reduction in the
purchase price of its services. The Administrator shall be contractually
bound hereunder by the terms of any publicly announced waiver of its fee, or
any limitation of each affected Fund's expenses, as if such waiver or
limitation were fully set forth herein.
(3) This Subcontract shall become effective on the date written above
and shall continue in effect as to each Investment Company and each Fund so
long as (1) the Agreement applicable to the Investment Company or Fund is in
effect and (2) this Subcontract is not terminated. This Subcontract will
terminate as to any Investment Company or Fund immediately upon the
termination of the Agreement applicable to the Investment Company or Fund,
and may in addition be terminated by either party at any time, without the
payment of any penalty, on sixty (60) days' written notice to the other party.
(4) In the absence of willful misfeasance, bad faith or gross
negligence on the part of the Administrator, or of reckless disregard of its
duties and obligations hereunder, the Administrator shall not be subject to
liability for any act or omission in the course of, or connected with,
rendering services hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Subcontract to
be executed by their duly authorized officers.
FRANKLIN ADVISERS, INC.
By: _____________________________
Xxxxxx X. Xxxxxxxx
President & Chief Investment Officer
FRANKLIN XXXXXXXXX SERVICES, LLC
By: _____________________________
Xxxxx X. Xxxxxxx
President
SUBCONTRACT FOR FUND ADMINISTRATIVE SERVICES
BETWEEN
FRANKLIN ADVISERS, INC.
AND
FRANKLIN XXXXXXXXX SERVICES, LLC
EXHIBIT A
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INVESTMENT COMPANY SERIES---(IF APPLICABLE)
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Franklin California Tax-Free
Income Fund
Franklin California Tax-Free Trust Franklin California Insured Tax-Free
Income Fund
Franklin California Tax-Exempt Money Fund
Franklin California Intermediate-Term
Tax-Free Income Fund
Franklin Capital Growth Fund
Franklin Custodian Funds, Inc. Franklin Dynatech Fund
Franklin Income Fund
Franklin Utilities Fund
Franklin U.S. Government Securities Fund
Franklin Federal Tax- Free Income
Fund
Franklin Gold and Precious Metals
Fund
Franklin High Income Trust Franklin High Income Fund
Franklin Investors Securities Franklin Convertible Securities Fund
Trust Franklin Equity Income Fund
Franklin Limited Maturity U.S. Gov.
Securities Fund
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INVESTMENT COMPANY SERIES---(IF APPLICABLE)
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Franklin Municipal Securities Franklin California High Yield Municipal
Trust Fund
Franklin Tennessee Municipal Bond Fund
Franklin New York Tax-Free Trust Franklin New York Tax-Exempt Money Fund
Franklin New York Insured Tax-Free
Income Fund
Franklin New York Intermediate-Term
Tax-Free Income Fund
Franklin New York Tax-Free Income
Fund
Franklin Real Estate Securities Franklin Real Estate Securities Fund
Trust
Franklin Strategic Mortgage
Portfolio
Franklin Strategic Series Franklin Flex Cap Growth Fund
Franklin Global Communications Fund
Franklin Global Health Care Fund
Franklin Natural Resources Fund
Franklin Small-Mid Cap Growth Fund
Franklin Strategic Income Fund
Franklin Tax-Exempt Money Fund
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INVESTMENT COMPANY SERIES---(IF APPLICABLE)
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Franklin Tax-Free Trust Franklin Alabama Tax-Free Income Fund
Franklin Arizona Tax-Free Income Fund
Franklin Colorado Tax-Free Income Fund
Franklin Connecticut Tax-Free Income Fund
Franklin Double Tax-Free Income Fund
Franklin Federal Intermediate-Term
Tax-Free
Income Fund
Franklin Florida Tax-Free Income Fund
Franklin Georgia Tax-Free Income Fund
Franklin High Yield Tax-Free Income Fund
Franklin Insured Tax-Free Income Fund
Franklin Kentucky Tax-Free Income Fund
Franklin Louisiana Tax-Free Income Fund
Franklin Maryland Tax-Free Income Fund
Franklin Massachusetts Insured Tax-Free
Income Fund
Franklin Michigan Insured Tax-Free
Income Fund
Franklin Minnesota Insured Tax-Free
Income Fund
Franklin Missouri Tax-Free Income Fund
Franklin New Jersey Tax-Free Income Fund
Franklin North Carolina Tax-Free Income
Fund
Franklin Ohio Insured Tax-Free Income
Fund
Franklin Oregon Tax-Free Income Fund
Franklin Pennsylvania Tax-Free Income
Fund
Franklin Virginia Tax-Free Income Fund
Franklin Xxxxxxxxx Global Trust Franklin Xxxxxxxxx Hard Currency Fund
Franklin Xxxxxxxxx International Templeton Foreign Smaller Companies Fund
Trust
CLOSED END FUNDS:
Franklin Universal Trust
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