FUND ADMINISTRATION AGREEMENT
AGREEMENT dated as of September 16, 1997 between FRANKLIN
FLOATING RATE TRUST, a Delaware business trust (the "Trust"), and FRANKLIN
XXXXXXXXX SERVICES, INC. (the "Administrator").
In consideration of the mutual agreements herein made, the
parties hereby agree as follows:
(1) The Administrator agrees, during the life of this Agreement, to
provide the following services to the Trust:
(a) providing office space, telephone, office equipment and
supplies for the Trust;
(b) providing trading desk facilities for the Trust, unless
these facilities are provided by the Trust's investment adviser;
(c) authorizing expenditures and approving bills for payment on
behalf of the Trust;
(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 Trust's shareholder
servicing agent or other agents of the Trust;
(e) coordinating the daily pricing of the Trust's investment
portfolio, including collecting quotations from pricing services engaged by
the Trust; providing fund accounting services, including preparing and
supervising publication of daily net asset value quotations, periodic
earnings reports and other financial data;
(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 Trust with recordkeeping
requirements under the federal securities laws, including the 1940 Act, and
the rules and regulations thereunder, supervising compliance with
recordkeeping requirements imposed by state laws or regulations, and
maintaining books and records for the Trust (other than those maintained by
the custodian and transfer agent);
(h) preparing and filing of tax reports including the Trust's
income tax returns, and monitoring the Trust's compliance with subchapter M
of the Internal Revenue Code, and other applicable tax laws and regulations;
(i) monitoring the Trust'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 Trust's investment objectives, policies and restrictions; and
the Code of Ethics and other policies adopted by the Trust's Board of
Trustees or ("Board") or by the Adviser and applicable to the Trust;
(j) providing executive, clerical and secretarial personnel
needed to carry out the above responsibilities; and
(k) preparing regulatory reports, including without limitation
NSARs, proxy statements and U.S. and foreign ownership reports.
Nothing in this Agreement shall obligate the Trust to pay any compensation to
the officers of the Trust. 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 Trust
to perform services on behalf of the Trust.
(2) The Trust 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 the Trust 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 0.10%; 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 Trust's expenses, as if such waiver or
limitation were fully set forth herein.
(3) This Agreement shall remain in full force and effect through for
one year after its execution and thereafter from year to year to the extent
continuance is approved annually by the Board of the Trust.
(4) This Agreement may be terminated by the Trust at any time on
sixty (60) days' written notice without payment of penalty, provided that
such termination by the Trust shall be directed or approved by the vote of a
majority of the Board of the Trust in office at the time or by the vote of a
majority of the outstanding voting securities of the Trust (as defined by the
1940 Act); and shall automatically and immediately terminate in the event of
its assignment (as defined by the 1940 Act).
(5) 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 Agreement
to be duly executed by their duly authorized officers.
FRANKLIN FLOATING RATE TRUST
By: /s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Vice President & Secretary
FRANKLIN XXXXXXXXX SERVICES, INC.
By: /s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Executive Vice President
