AS FILED WITH THE SEC ON APRIL 10, 1998
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Pre-Effective Amendment No. 1 X
Post-Effective Amendment No.
(check appropriate box or boxes)
FRANKLIN CUSTODIAN FUNDS, INC.
(Exact Name of Registrant as Specified in Charter)
(650) 312-2000
(Area Code and Telephone Number)
777 Mariners Island Blvd., San Mateo, CA 94404
(Address of Principal Executive Offices --
Number, Street, City, State, Zip Code)
Harmon E. Burns, Esquire
777 Mariners Island Blvd.,
San Mateo, CA 94404
(Name and Address of Agent for Service --
Number, Street, City, State, Zip Code)
Copies to:
Bruce G. Leto, Esquire
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103
Approximate Date of Proposed Public Offering: As soon as
practicable after this Registration Statement becomes effective
under the Securities Act of 1933.
TITLE OF SECURITIES BEING REGISTERED: CLASS I, INCOME SERIES
No filing fee is due because of reliance on Section 24(f) of the
Investment Company Act of 1940. Pursuant to Rule 429(a), this
Registration Statement relates to shares previously registered on
Form N-1A (Securities Act of 1933 File No. 002-11346; Investment
Company Act of 1940 File No. 811-537).
Pursuant to Rule 488 this Registration Statement shall become effective
on April 11, 1998 which shall be thirty days following the initial
filing of this Registration Statement.
FRANKLIN CUSTODIAN FUNDS, INC.
CROSS REFERENCE SHEET
(Pursuant to Rule 481(a) under the
Securities Act of 1933)
N-14 ITEM NO. AND CAPTION LOCATION IN PROSPECTUS
PART A
1. Beginning of Registration Cover Page of Registration Statement;
Statement and Outside Front Cover Front Cover Page of Prospectus
Page of Prospectus
2. Beginning and Outside Back Cover Table of Contents
Page of Prospectus
3. Fee Table, Synopsis Information Summary; Risk Factors
and Risk Factors
4. Information About the Transaction Summary; Reasons for the
Reorganization; Information About the
Reorganization
5. Information About the Registrant Prospectus Cover Page; Summary;
Comparison of Investment Policies and
Risks of Income Series and the Fund;
Information About Custodian Funds
6. Information About the Company Prospectus Cover Page; Comparison of
Being Acquired Investment Policies and Risks of
Income Series and the Fund;
Additional Matters Regarding the
Fund; Other Information Relating to
the Fund
7. Voting Information Prospectus Cover Page; Notice of
Special Meeting of Shareholders;
Solicitation and Revocation of
Proxies and Voting Information;
Principal Shareholders;
Summary-Voting Information
8. Interest of Certain Persons and None
Experts
9. Additional Information Required Not Applicable
for Reoffering by Persons Deemed
to be Underwriters
LOCATION IN STATEMENT OF
PART B ADDITIONAL INFORMATION
10. Cover Page Cover Page of Statement of Additional
Information
11. Table of Contents Not Applicable
12. Additional Information Incorporation of Documents by
about the Registrant Reference in the Statement of
Additional Information
13. Additional Information Incorporation of Documents by
about the Company Being Acquired Reference in the Statement of
Additional Information
14. Financial Statements Incorporation of Documents by
Reference in the Statement of
Additional Information
PART C - OTHER INFORMATION
Part C contains the information required by Items 15-17 under the items set
forth in the Form.
Parts A, B and C of this Registration Statement on Form N-14 (the
"Registration Statement") are incorporated by reference into this
Pre-Effective Amendment No. 1 to the Registration Statement from the initial
filing of the Registration Statement with the SEC via EDGAR on March 12,
1998, except that parts (11) and (12) of Item 16 of Part C of the
Registration Statement are amended as shown below, and the relevant Exhibits
are included with this filing:
(11) An opinion and consent of counsel as to the legality of the
securities being registered, indicating whether they will, when sold,
be legally issued, fully paid and non-assessable.
FILED HEREWITH.
(12) An opinion of counsel letter supporting the tax matters and
consequences to shareholders discussed in the Prospectus/Proxy
Statement.
A FORM OF THE TAX OPINION IS FILED HEREWITH AS AN EXHIBIT TO THE
REGISTRATION STATEMENT AND PURSUANT TO THE UNDERTAKING PREVIOUSLY
MADE IN ITEM 17(3) OF THE REGISTRATION STATEMENT, THE FINAL TAX
OPINION WILL BE FILED AS A POST-EFFECTIVE AMENDMENT TO THE
REGISTRATION STATEMENT.
SIGNATURES
As required by the Securities Act of 1933, this Registration Statement has
been signed on behalf of the Registrant, by the undersigned, thereunto duly
authorized, in the City of San Mateo and the State of California, on the 9th
day of April, 1998.
FRANKLIN CUSTODIAN FUNDS, INC.
(Registrant)
By: CHARLES B. JOHNSON*
Charles B. Johnson
President
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities
and on the dates indicated:
CHARLES B. JOHNSON* Chief Executive Officer and Director
Charles B. Johnson Dated: April 9, 1998
MARTIN L. FLANAGAN* Senior Vice President and Chief
Martin L. Flanagan Financial Officer
Dated: April 9, 1998
DIOMEDES LOO-TAM* Principal Accounting Officer
Diomedes Loo-Tam Dated: April 9, 1998
HARRIS J. ASHTON* Director
Harris J. Ashton Dated: April 9, 1998
S. JOSEPH FORTUNATO* Director
S. Joseph Fortunato Dated: April 9, 1998
EDITH E. HOLIDAY* Director
Edith E. Holiday Dated: April 9, 1998
RUPERT H. JOHNSON, JR.* Director
Rupert H. Johnson, Jr. Dated: April 9, 1998
GORDON S. MACKLIN* Director
Gordon S. Macklin Dated: April 9, 1998
*By: LARRY L. GREENE
Larry L. Greene, Attorney-in-Fact
(Pursuant to Powers of Attorney previously filed)
EXHIBIT INDEX
EXHIBIT NO. DOCUMENT
(11) Opinion and consent of counsel as to the legality of the
securities being registered, indicating whether they
will, when sold, be legally issued, fully paid and
non-assessable.
(12) An opinion of counsel letter supporting the tax matters and
consequences to shareholders discussed in the
Prospectus/Proxy Statement
Exhibit 11
Law Offices
STRADLEY, RONON, STEVENS & YOUNG, LLP
2600 One Commerce Square
Philadelphia, Pennsylvania 19103-7098
(215) 564-8000
Direct Dial: (215) 564-8024
April 9, 1998
Franklin Custodian Funds
777 Mariners Blvd.
San Mateo, CA 94404
Re: LEGAL OPINION-SECURITIES ACT OF 1933
Ladies and Gentlemen:
We have examined the Articles of Incorporation, as amended (the
"Articles"), of Franklin Custodian Funds, Inc. (the "Fund"), a series
corporation organized under Maryland law, the By-Laws of the Fund, the
resolutions adopted by the Fund's Board of Directors organizing the business
of the Fund, and its proposed form of Share Certificates (if any), all as
amended to date, and the various pertinent corporate proceedings we deem
material. We have also examined the Notification of Registration and the
Registration Statements filed under the Investment Company Act of 1940 (the
"Investment Company Act") and the Securities Act of 1933 (the "Securities
Act"), all as amended to date, as well as other items we deem material to
this opinion.
The Fund is authorized by the Articles to issue nineteen billion
(19,000,000,000) shares of common stock at a par value of $.01. The Fund
issues shares of the U.S. Government Series, the Income Series, the Growth
Series, the DynaTech Series, and the Utilities Series. The Articles also
empower the Board to designate any additional series or classes and allocate
shares to such series or classes.
The Fund has filed with the U.S. Securities and Exchange Commission, a
registration statement on Form N-14 under the Securities Act, covering shares
of the Fund to be issued to Franklin Principal Maturity Trust, a registered
closed-end investment company, in exchange for substantially all of the
assets and liabilities of Franklin Principal Maturity Trust pursuant to an
Agreement and Plan of Reorganization to be approved by shareholders of
Franklin Principal Maturity Trust.
The Fund has also filed with the U.S. Securities and Exchange Commission, a
registration statement on Form N-1A under the Securities Act, which
registration statement is deemed to register an indefinite number of shares
of the Fund pursuant to the provisions of Rule 24f-2 under the Investment
Company Act. You have further advised us that the Fund has filed, and each
year hereafter will timely file, a Notice pursuant to Rule 24f-2 perfecting
the registration of the shares sold by the Fund during each fiscal year
during which such registration of an indefinite number of shares remains in
effect.
You have also informed us that the shares of the Fund have been, and will
continue to be, sold in accordance with the Fund's usual method of
distributing its registered shares, under which prospectuses are made
available for delivery to offerees and purchasers of such shares in
accordance with Section 5(b) of the Securities Act.
Based upon the foregoing information and examination, so long as the Fund
remains a valid and subsisting entity under the laws of its state of
organization, and the registration of an indefinite number of shares of the
Fund remains effective, the authorized shares of the Fund when issued for the
consideration set by the Board of Directors pursuant to the Articles, and
subject to compliance with Rule 24f-2, will, when sold, be legally issued,
fully-paid, and non-assessable shares, and the holders of such shares will
have all the rights provided for with respect to such holding by the Articles
and the laws of the State of Maryland.
We hereby consent to the use of this opinion, in lieu of any other, as an
exhibit to any Registration Statement of the Fund, along with any amendments
thereto, covering the registration of the shares of the Fund under the
Securities Act and the applications, registration statements or notice
filings, and amendments thereto, filed in accordance with the securities laws
of the several states in which shares of the Fund are offered, and we further
consent to reference in any registration statement of the Fund to the fact
that this opinion concerning the legality of the issue has been rendered by
us.
Very truly yours,
STRADLEY, RONON, STEVENS & YOUNG, LLP
BY: /S/ MARK H. PLAFKER
Mark H. Plafker
Exhibit 12
DRAFT
March 18, 1998
Board of Trustees
Franklin Principal Maturity Trust
777 Mariners Island Blvd.
San Mateo, CA 94404
Board of Directors
Franklin Custodian Funds, Inc. - Income Series
777 Mariners Island Blvd.
San Mateo, CA 94404
Re: AGREEMENT AND PLAN OF REORGANIZATION, DATED AS OF THE____TH
DAY OF______, 1998, BY AND BETWEEN FRANKLIN PRINCIPAL MATURITY
TRUST ("ACQUIRED FUND") AND FRANKLIN CUSTODIAN FUNDS, INC.
("CUSTODIAN FUNDS") ON BEHALF OF THE INCOME SERIES ("ACQUIRING
FUND")
Ladies and Gentlemen:
You have requested our opinion as to certain federal income tax
consequences of the reorganization of Acquired Fund whereby, Acquired Fund
will transfer substantially all of its property, assets, and goodwill to
Acquiring Fund in exchange solely for Class I Shares of Acquiring Fund (the
"Acquiring Fund Shares"), followed by the distribution by Acquired Fund of
Acquiring Fund Shares to the shareholders of Acquired Fund, the cancellation
of all of the outstanding Shares of beneficial interest of Acquired Fund (the
"Acquired Fund Shares") and the liquidation of Acquired Fund (the
"Reorganization"). Franklin Advisers, Inc. ("Advisers") is the investment
adviser for both the Acquiring Fund and the Acquired Fund.
In rendering our opinion, we have reviewed and relied upon (a) the
Agreement and Plan of Reorganization, dated as of the th day of
, 1998, by and between Custodian Funds and the Acquired Fund ("Agreement"),
(b) the proxy materials provided to stockholders of Acquired Fund in
connection with the Special Meeting of Stockholders of Acquired Fund held
on__________________, 1998, (c) certain representations concerning the
Reorganization made to us by Custodian Funds and the Acquired Fund in a
letter dated_________________, 1998 (the "Representation Letter"), (d) all
other documents, financial and other reports and corporate minutes which we
deemed relevant or appropriate, and (e) such statutes, regulations, rulings
and decisions as we deemed material to the rendition of this opinion. All
terms used herein, unless otherwise defined, are used as defined in the
Agreement.
For purposes of this opinion, we have assumed that Acquired Fund on the
effective date of the Reorganization satisfies, and following the
Reorganization, Acquiring Fund will continue to satisfy, the requirements of
subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"),
for qualification as a regulated investment company.
Under regulations to be prescribed by the Secretary of Treasury under
Section 1276(d) of the Code, certain transfers of market discount bonds will
be excepted from the requirement that accrued market discount be recognized
on disposition of a market discount bond under Section 1276(a) of the Code.
Such regulations are to provide, in part, that accrued market discount will
not be included in income if no gain is recognized under Section 361(a) of
the Code where a bond is transferred in an exchange qualifying as a tax-free
reorganization. As of the date hereof, the Secretary has not issued any
regulations under Section 1276 of the Code.
Based on the foregoing and provided the Reorganization is carried out in
accordance with the applicable laws of the State of Maryland, the Agreement
and the Representation Letter, it is our opinion that:
1. The Reorganization will constitute a tax-free reorganization within the
meaning of Section 368(a)(1)(C) of the Code, and Acquired Fund and Acquiring
Fund will each be a party to the reorganization within the meaning of Section
368(b) of the Code.
2. No gain or loss will be recognized by Acquired Fund upon the transfer
of all of its assets to Acquiring Fund in exchange solely for Acquiring Fund
Shares pursuant to Section 361(a) and Section 357(a) of the Code. We express
no opinion as to whether any accrued market discount will be required to be
recognized as ordinary income pursuant to Section 1276 of the Code.
3. No gain or loss will be recognized by Acquiring Fund upon the receipt
by it of all of the assets of Acquired Fund in exchange solely for Acquiring
Fund Shares pursuant to Section 1032(a) of the Code.
4. The basis of the assets of Acquired Fund received by Acquiring Fund
will be the same as the basis of such assets to Acquired Fund immediately
prior to the exchange pursuant to Section 362(b) of the Code.
5. The holding period of the assets of Acquired Fund received by Acquiring
Fund will include the period during which such assets were held by Acquired
Fund pursuant to Section 1223(2) of the Code.
6. No gain or loss will be recognized by the stockholders of Acquired Fund
upon the exchange of their Acquired Fund Shares for Acquiring Fund Shares
(including fractional shares to which they may be entitled), pursuant to
Section 354(a) of the Code.
7. The basis of the Acquiring Fund Shares received by the stockholders of
Acquired Fund (including fractional shares to which they may be entitled)
will be the same as the basis of the Acquired Fund Shares exchanged therefor
pursuant to Section 358(a)(1) of the Code.
8. The holding period of the Acquiring Fund Shares received by the
stockholders of Acquired Fund (including fractional shares to which they may
be entitled) will include the holding period of the Acquired Fund Shares
surrendered in exchange therefor, provided that the Acquired Fund Shares were
held as a capital asset on the effective date of the Reorganization, pursuant
to Section 1223(1) of the Code.
9. Acquiring Fund will succeed to and take into account as of the date of
the proposed transfer (as defined in Section 1.381(b)-1(b) of the Income Tax
Regulations) the items of Acquired Fund described in Section 381(c) of the
Code, subject to the conditions and limitations specified in Sections 381(b)
and (c), 382, 383 and 384 of the Code.
Our opinion is based upon the Code, the applicable Treasury Regulations
promulgated thereunder, the present position of the Internal Revenue Service
as set forth in published revenue rulings and revenue procedures, present
administrative positions of the Internal Revenue Service, and existing
judicial decisions, all of which are subject to change either prospectively
or retroactively. We do not undertake to make any continuing analysis of the
facts or relevant law following the date of this letter.
Our opinion is conditioned upon the performance by Acquiring Fund and
Acquired Fund of their undertakings in the Agreement and the Representation
Letter.
This opinion is being rendered to Acquiring Fund and Acquired Fund and may
be relied upon only by such funds and the stockholders of each.
Very truly yours,
STRADLEY, RONON, STEVENS & YOUNG, LLP
By:___________________________________
William P. Zimmerman, a Partner
