SUBADVISORY AGREEMENT
FRANKLIN GLOBAL TRUST
THIS SUBADVISORY AGREEMENT made as of the 29th day of December 2000, by
and between FRANKLIN ADVISERS, INC., a corporation organized and existing
under the laws of the State of California (hereinafter called "FAV"), and
FIDUCIARY INTERNATIONAL, INC., a New York corporation (hereinafter called
"FII").
W I T N E S S E T H
WHEREAS, FAV and FII 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, FAV has been retained to render investment advisory services to
each of the series listed on Schedule A (each a "Fund" and collectively the
"Funds"), of Franklin Global 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, FAV desires to retain FII to render investment advisory,
research and related services to each Fund pursuant to the terms and
provisions of this Agreement, and FII 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. FAV hereby retains FII and FII hereby accepts such engagement, to
furnish certain investment advisory services with respect to the assets of
each 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 FAV, FII will provide a continuous investment program for each
Fund, 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 FAV determine, on no less frequently than an annual basis, to grant
the necessary delegated authority to FII, and subject to paragraph (b) below,
FII will 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 except that orders regarding U.S. domiciled securities and
money market instruments may also be placed on behalf of the Fund by FAV.
(b) In performing these services, FII 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 FAV 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 FAV or the Board, and subject
to the provisions of this Agreement and to any guidelines or limitations
specified from time to time by FAV or by the Board, FII shall report daily
all transactions effected by FII on behalf of the Fund to FAV and to other
entities as reasonably directed by FAV or the Board.
(d) FII 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. FII 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, FII shall comply with
all reasonable instructions of the Fund or FAV in connection therewith. Such
instructions may be given by letter, e-mail, 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 FII.
2. In performing the services described above, FII shall use its best
efforts to obtain for each Fund the most favorable price and execution
available. Subject to prior authorization of appropriate policies and
procedures by the Board, FII 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, FII 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) FII shall, unless otherwise expressly provided and authorized,
have no authority to act for or represent FAV or the Fund in any way, or in
any way be deemed an agent for FAV or the Fund.
(b) It is understood that the services provided by FII are not to
be deemed exclusive. FAV acknowledges that FII 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 a Fund. FAV agrees that FII may give
advice or exercise investment responsibility and take such other action with
respect to such Clients that may differ from advice given or the timing or
nature of action taken with respect to the Fund.
4. FII agrees to use its best efforts in performing the services to be
provided by it pursuant to this Agreement.
5. FAV has furnished or will furnish to FII as soon as available
copies properly certified or authenticated of each of the following documents:
(a) the Trust's Declaration of Trust, as filed with the Secretary
of State of the State of Delaware on September 26, 2000, 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 FII 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 Funds;
(e) each Fund's most recent Prospectus and Statement of Additional
Information; and
(f) the Investment Advisory Agreement between the Fund and FAV.
FAV will furnish FII with copies of all amendments of or supplements to the
foregoing documents.
6. FII will treat confidentially and as proprietary information of
each Fund all records and other information relative to such 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 Trust, which approval shall not be unreasonably withheld and
may not be withheld where FII 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 Trust.
7. (a) FAV shall pay a monthly fee in cash to FII based upon a
percentage of the value of each Fund's net assets, calculated as set forth in
the written schedule of fees annexed hereto as Schedule B and incorporated
herein, as compensation for the services rendered and obligations assumed by
FII, during the preceding month, on the first business day of the month in
each year.
(b) For purposes of calculating such fee, the value of the net
assets of each Fund shall be determined in the same manner as that Fund uses
to compute the value of its net assets in connection with the determination
of the net asset value of its shares, all as set forth more fully in the
Fund's current prospectus and statement of additional information.
(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
each Fund.
9. (a) In the absence of willful misfeasance, bad faith, negligence,
or reckless disregard of its obligations or duties hereunder on the part of
FII, neither FII nor any of its directors, officers, employees or affiliates
shall be subject to liability to FAV or a Fund or to any shareholder of a
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 a Fund.
(b) Notwithstanding paragraph 9(a), to the extent that FAV is
found by a court of competent jurisdiction, or the SEC or any other
regulatory agency, by order that cannot be appealed or with respect to which
no appeal was undertaken, to be liable to a Fund or any shareholder (a
"liability"), for any acts undertaken by FII pursuant to authority delegated
to FII as described in Paragraph 1(a), FII shall indemnify and save FAV and
each of its affiliates, officers, directors and employees (each a "Franklin
Indemnified Party") harmless from, against, for and in respect of all losses,
damages, costs and expenses incurred by a Franklin Indemnified Party with
respect to such liability, together with all legal and other expenses
reasonably incurred by any such Franklin Indemnified Party, in connection
with such liability.
(c) No provision of this Agreement shall be construed to protect
any director or officer of FAV or FII from liability in violation of Sections
17(h) or (i), respectively, of the 1940 Act.
10. During the term of this Agreement, FII 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 a Fund. Each Fund and FAV will be responsible for all of their
respective expenses and liabilities.
11. This Agreement shall be effective as of the date given above, 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 each
Fund, and (ii) with respect to each Fund, 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 with respect to any or all of the
Funds at any time, without payment of any penalty, by the Board or by vote of
a majority of the outstanding voting securities of each respective Fund, upon
sixty (60) days' written notice to FAV and FII and by FAV or FII 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
FAV and the Fund.
14. In compliance with the requirements of Rule 31a-3 under the 1940
Act, FII hereby agrees that all records which it maintains for each Fund are
the property of such Fund and further agrees to surrender promptly to the
Fund, or to any third party at the Fund's direction, copies of any of such
records upon the Fund's request. FII 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 FAV and FII.
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 California of the United States of America.
19. FII acknowledges that it has received notice of and accepts the
limitations of the Trust's liability as set forth in its Agreement and
Declaration of Trust. FII agrees that the Trust's obligations hereunder
shall be limited to the assets of each Fund, and that FII shall not seek
satisfaction of any such obligation from any shareholders of a Fund nor from
any trustee, officer, employee or agent of the Trust.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested by their duly authorized officers.
FRANKLIN ADVISERS, INC.
By: /s/ CHARLES E. JOHNSON
Charles E. Johnson
Title: President
FIDUCIARY INTERNATIONAL, INC.
By: _______________________
Title:______________________
FRANKLIN GLOBAL TRUST, on behalf of each Fund, hereby acknowledges and agrees
to the provisions of paragraphs 9(a) and 10 of this Agreement.
FRANKLIN GLOBAL TRUST on behalf of
each FUND listed in Schedule A hereto
By: /s/ MURRAY L. SIMPSON
Murray L. Simpson
Title: Secretary
SCHEDULE A
SUBADVISORY AGREEMENT
between
FRANKLIN ADVISERS, INC.
and
FIDUCIARY INTERNATIONAL, INC.
FOR THE BENEFIT OF:
Franklin Global Aggressive Growth Fund
Franklin Global Growth Fund
IN WITNESS WHEREOF, the parties hereto have caused this Schedule A to the
Subadvisory Agreement to be executed and effective on the 29th day of
December 2000.
FIDUCIARY INTERNATIONAL, INC.
By: __________________________
Title: ________________________
FRANKLIN ADVISERS, INC.
By: /s/ CHARLES E. JOHNSON
Charles E. Johnson
Title: President
SCHEDULE B
The rate of the subadvisory fee payable by Franklin Advisers, Inc. to
Fiduciary International, Inc. with respect to the listed series of the
Franklin Global Trust shall be calculated daily at the following annual
rates:
FRANKLIN GLOBAL AGGRESSIVE GROWTH FUND
-------------------------------------------------
Rate Assets
-------------------------------------------------
0.600% First $100 million
--------
0.500 Over $100 million up to and including
$250 million
--------
0.450 Over $250 million, up to and including
$500 million
--------
0.400 Over $500 million
-------------------------------------------------
FRANKLIN GLOBAL GROWTH FUND
-------------------------------------------------
Rate Assets
-------------------------------------------------
0.550% First $100 million
--------
0.500 Over $100 million up to and including
$250 million
--------
0.450 Over $250 million, up to and including
$500 million
--------
0.400 Over $500 million
-------------------------------------------------
IN WITNESS WHEREOF, the parties hereto have caused this Schedule B to the
Subadvisory Agreement to be executed and effective on the 29th day of
December 2000.
FIDUCIARY INTERNATIONAL, INC.
By: _______________________
Title: _____________________
FRANKLIN ADVISERS, INC.
By: /s/ CHARLES E. JOHNSON
Charles E. Johnson
Title: President
