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EXHIBIT 10.61
MASTER MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT dated as of May 31, 2001, between Franklin
Xxxxxxxxx Tax Class Corp. (hereinafter referred to as the "Tax Class Corp."), a
corporation incorporated under the laws of Alberta with its principal office at
Xxxxx 0000, 000 - 0xx Xxxxxx X.X., Xxxxxxx, Xxxxxxx, X0X 0X0, as the issuer of
the classes of shares listed from time to time in Schedule "A" to this agreement
(collectively, the "Classes") and Franklin Xxxxxxxxx Investments Corp. (the
"Manager"), a corporation organized under the laws of Ontario with its place of
business at Xxxxx 0000, 000 - 0xx Xxxxxx X.X., Xxxxxxx, Xxxxxxx, X0X 0X0.
The parties hereby declare that this master agreement may be amended in the
future to add or delete any of the Classes or series of shares and for any other
purpose permitted by the terms of this master agreement.
In consideration of the mutual promises made in this Agreement, the parties
hereby agree as follows:
(1) ADMINISTRATION
Manager agrees, during the life of this Agreement, to be responsible for:
(a) providing office space, telephone, office equipment and supplies in
Alberta for Tax Class Corp.;
(b) within the parameters approved by Tax Class Corp. authorizing
expenditures and approving bills for payment on behalf of Tax Class
Corp.;
(c) supervising preparation of periodic reports to shareholders of each
Class within Tax Class Corp. ("Shareholders"), notices of dividends,
capital gains distributions and tax credits, and attending to routine
correspondence and other communications with individual Shareholders;
(d) daily pricing of each Class within Tax Class Corp.'s investment
portfolio and preparing and supervising publication of the daily net
asset value of shares of each series within each Class ("Shares"),
earnings reports and other financial data;
(e) monitoring relationships with organizations serving Tax Class Corp.,
including custodians, transfer agents, public accounting firms, law
firms, printers and other third party service providers;
(f) supervising compliance by Tax Class Corp. with recordkeeping
requirements under applicable laws, supervising compliance with
recordkeeping requirements imposed by applicable laws, and maintaining
books and records for Tax Class Corp. (other than those maintained by
the custodian and transfer agent);
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(g) preparing and filing of tax reports including Tax Class Corp.'s income
tax returns, and monitoring Tax Class Corp.'s compliance with
applicable tax laws and regulations;
(h) monitoring Tax Class Corp.'s compliance with provincial, federal and
foreign laws and regulations applicable to the operation of investment
funds.; the Classes investment objectives, policies and restrictions;
and the Code of Ethics and other policies adopted by Tax Class Corp.
or by the Classes' Investment Advisor and applicable to Tax Class
Corp.;
(i) providing executive, clerical and secretarial personnel needed to
carry out the above responsibilities;
(j) preparing regulatory reports, including without limitation, proxy
statements and foreign ownership reports; and
(k) acting as an advisor to manage the investment and reinvestment of the
Fund's assets, within the parameters set out in written instructions
received from Tax Class Corp.
(2) DISTRIBUTION OF SHARES
(a) The Manager shall be the principal distributor of the Shares
throughout Canada, and agrees to use its best efforts to bring about
and maintain a broad distribution of the Shares among bona fide
investors, including through registered dealers.
(b) The Shares shall be available for sale on the following basis:
(i) Series A Shares of each Class shall be offered for sale at a
price equal to their net asset value per Series (as defined in
Tax Class Corp.'s articles) plus a sales commission (that is, on
a "front-load basis") provided, however, that such commission
shall not exceed the rate of commission described in the then
current prospectus of the Class. Except as provided in the then
current prospectus of Tax Class Corp., each Class shall also
offer Series A Shares of the Class for sale on a deferred sales
charge basis, that is, without an initial sales commission but
subject to a redemption charge not exceeding the rate of
redemption charge described in the prospectus of the Class in
effect when the Series A Shares were issued. The Manager shall
pay or arrange for payment to dealers, from its own sources or
sources arranged by it and not from any Classes within Tax Class
Corp., a sales commission based on the net asset value of each
Series A Share of the Class they sell on a deferred sales charge
basis. The amount of the sales commission shall be determined by
the Manager from time to time in its sole discretion.
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(ii) Series F Shares of each Class shall be offered for sale at a
price equal to their net asset value per Series (as defined in
Tax Class Corp.'s articles) and are sold on a no-load basis only
without a sales commission or redemption charge.
(iii)Series I Shares of each Class shall be offered for sale at a
price equal to their net asset value per Series (as defined in
Tax Class Corp.'s articles) plus a sales commission (that is, on
a "front-load basis" only), provided, however, that such
commission shall not exceed the rate of commission described in
the then current prospectus of the Class.
(iv) Series O Shares of each Class shall be offered for sale at a
price equal to their net asset value per Series (as defined in
Tax Class Corp.'s articles) and are sold on a no-load basis only
without a sales commission or redemption charge.
Shares of any Class within Tax Class Corp. may also be offered
for sale on any other basis determined by the Tax Class Corp.
(c) The Manager further agrees, during the life of this Agreement, to
compensate registered dealers for ongoing services to their clients
holding front-load, deferred sales charge or other specified Series A,
Series I or Series O Shares of the Classes by making cash payments,
known as "trail commissions", to dealers selling Series A, Series I or
Series O Shares of the Classes. The trail commissions will be paid by
the Manager to registered dealers quarterly (or such other frequency
as may be determined by the Manager) in arrears based on the average
daily net asset value of the Series A, Series I or Series O Shares of
the Classes held by their sales representatives' customers, net of
redemptions. The trail commission or the payment thereof shall be
determined by the Manager and may be changed at any time and from time
to time by the Manager in its sole discretion.
(d) Each Series of Shares of the Classes shall pay all administrative
expenses including the Series' proportionate share of common Class
expenses and the expenses that are only applicable to that particular
Series. Expenses include those (i) incidental to registering and
qualifying, and maintaining the registration and qualification of, the
Shares of the Tax Class Corp. for sale under applicable securities
laws and regulations of the jurisdictions in Canada in which the Tax
Class Corp. desires to distribute such Shares and as the Manager may
reasonably request in connection with its duties to bring about and
maintain a broad distribution of Tax Class Corp.'s Shares among bona
fide investors; and (ii) for preparing, setting up, printing and
distributing financial reports for existing Shareholders.
(e) The Manager shall process redemptions per Series of Shares of the
Classes offered for resale to it at the net asset value per Series of
such Shares, as defined in the Articles of Incorporation of Tax Class
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Corp. Whenever the Tax Class Corp. deems it advisable for the
protection of the Shareholders, Tax Class Corp. may suspend or cancel
such authority.
(f) The Manager will conduct its business in strict accordance with the
applicable requirements of Tax Class Corp.'s Articles of Incorporation
as from time to time amended, and in strict accordance with all
applicable Canadian, provincial and local statutes, rules and
regulations.
(3) TERM
This Agreement shall be effective from the date written above and shall
continue in effect for two years thereafter, unless sooner terminated by Tax
Class Corp. or the Manager by giving sixty (60) days' written notice in advance
to the other. This Agreement shall continue in effect thereafter for one year
periods unless terminated by either party as written above.
(4) FEES
Tax Class Corp. agrees, during the life of this Agreement, to pay to
the Manager monthly as compensation for its services hereunder the fees set
out in a separate side agreement for the Classes within Tax Class Corp.
(5) USE OF SERVICE PROVIDERS
The Manager may, at any time and from time to time, retain, employ or
appoint one or more employees, agents, assistants or advisors of the Manager to
perform such functions and to provide such services in connection with this
Agreement as the Manager determines. The Manager also may, at any time and from
time to time, delegate to one or more sub-distributors responsibility and
authority to perform such functions and to provide such services under this
Agreement as the Manager determines. All expenses incurred in connection with
any such employee, agent, assistant, advisor or sub-distributor shall be for the
sole account of the Manager.
(6) TERMINATION
This Agreement may be terminated by Tax Class Corp. at any time on sixty
(60) days' written notice without payment of penalty, provided that such
termination by Tax Class Corp. shall be directed or approved by the vote of a
majority of the outstanding voting securities of Tax Class Corp.; and shall
automatically and immediately terminate in the event of its assignment by the
Manager, other than to an affiliate of the Manager.
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(7) LIABILITY
In the absence of willful misfeasance, bad faith or gross negligence on the
part of the Manager, or of reckless disregard of its duties and obligations
hereunder, the Manager shall not be subject to liability for any act or omission
in the course of, or connected with, rendering services hereunder.
(8) DUTY OF CARE
The Manager shall in the exercise of the powers, rights, duties and
obligations prescribed or conferred on the Manager by this Agreement, exercise
that degree of care, diligence and skill that a reasonably prudent person would
exercise in comparable circumstances and shall exercise its powers and discharge
its duties hereunder honestly, in good faith and in the best interests of each
Class within Tax Class Corp.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their duly authorized officers as of the date first written above.
FRANKLIN XXXXXXXXX TAX CLASS CORP.
By: /s/ Xxxxx Xxxxx
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By: /s/ Xxx Xxxx
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FRANKLIN XXXXXXXXX INVESTMENTS CORP.
By: /s/ Xxxxx Xxxx
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By: /s/ Xxxxxxx Xxxxx
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SCHEDULE "A"
Templeton Growth Tax Class
Xxxxxxxxx International Stock Tax Class
Xxxxxxxxx Emerging Markets Tax Class
Xxxxxxxxx Global Smaller Companies Tax Class
Templeton Canadian Stock Tax Class
Templeton European Tax Class
Franklin Japan Tax Class
Franklin U.S. Large Cap Growth Tax Class
Franklin U.S. Aggressive Growth Tax Class
Franklin U.S. Small Cap Growth Tax Class
Franklin World Health Sciences and Biotech Tax Class
Franklin World Telecom Tax Class
Franklin Technology Tax Class
Franklin U.S. Money Market Tax Class
Franklin World Growth Tax Class
Xxxxxxx Canadian Equity Tax Class
Xxxxxxx Small Cap Tax Class
Xxxxxxx Multinational Growth Tax Class
Xxxxxxx Bond Tax Class
Xxxxxxx Money Market Tax Class
Mutual Beacon Tax Class
