EX-99.G 6 ex-gvii.txt AMENDED AND RESTATED FOREIGN CUSTODY MANAGER AGREEMENT AGREEMENT made as of May 16, 2001 between Each Investment Company Listed on Schedule 1 attached hereto (each a "Fund") and The Bank of New York ("BNY"). W I T N E S S E T H: WHEREAS, each Fund appointed BNY as a Foreign Custody Manager on the terms and conditions contained in a certain Foreign Custody Agreement made as of July 30, 1998 or May 7, 1998, and effective as of February 27, 1998 (the "Prior Agreement"); WHEREAS, each Fund and BNY desire to amend and restate the Prior Agreement; WHEREAS, BNY desires to continue to serve as a Foreign Custody Manager and perform the duties set forth herein on the terms and conditions contained herein; NOW THEREFORE, in consideration of the mutual promises hereinafter contained in this Agreement, each Fund and BNY hereby agree as follows: ARTICLE I. DEFINITIONS Whenever used in this Agreement, the following words and phrases, unless the context otherwise requires, shall have the following meanings: 1. "BOARD" shall mean the board of directors or board of trustees, as the case may be, of the Fund. 2. "ELIGIBLE FOREIGN CUSTODIAN" shall have the meaning provided in the Rule. 3. "MONITORING SYSTEM" shall mean a system established by BNY to fulfill the Responsibilities (as herein defined) specified in clauses (d) and (e) of Section 1 of Article III of this Agreement. 4. "RESPONSIBILITIES" shall mean the responsibilities delegated to BNY under the Rule (as herein defined) as a Foreign Custody Manager with respect to each Specified Country (as herein defined) and each Eligible Foreign Custodian selected by BNY, as such responsibilities are more fully described in Article III of this Agreement. 5. "RULE" shall mean Rule 17f-5 under the Investment Company Act of 1940, as amended on June 12, 2000. 6. "SPECIFIED COUNTRY" shall mean each country listed on Schedule 2 attached hereto and each country, other than the United States, constituting the primary market for a security with respect to which the Fund has given settlement instructions to BNY as custodian (the "Custodian") under its Custody Agreement with the Fund. ARTICLE II. BNY AS A FOREIGN CUSTODY MANAGER 1. Each Fund on behalf of its Board hereby delegates to BNY with respect to each Specified Country the Responsibilities. 2. BNY accepts the Board's delegation of Responsibilities with respect to each Specified Country and agrees in performing the Responsibilities as a Foreign Custody Manager to exercise reasonable care, prudence and diligence such as a person having responsibility for the safekeeping of the Fund's Foreign Assets (as defined in the Rule) would exercise. 3. BNY shall provide to the Board at such times as the Board deems reasonable and appropriate based on the circumstances of the Fund's foreign custody arrangements written reports notifying the Board of the placement of assets of the Fund with a particular Eligible Foreign Custodian within a Specified Country and of any material change in the arrangements (including the contract governing such arrangements) with respect to Foreign Assets (as defined in the Rule) of the Fund with any such Eligible Foreign Custodian. ARTICLE III. RESPONSIBILITIES 1. Subject to the provisions of this Agreement, BNY shall with respect to each Specified Country select an Eligible Foreign Custodian. In connection therewith, BNY shall: (a) determine that assets of the Fund held by such Eligible Foreign Custodian will be subject to reasonable care, based on the standards applicable to custodians in the relevant market in which such Eligible Foreign Custodian operates, after considering all factors relevant to the safekeeping of such assets, including, without limitation, those contained in paragraph (c)(1) of the Rule; (b) determine that the Fund's foreign custody arrangements with each Eligible Foreign Custodian are governed by a written contract with the Custodian which will provide reasonable care for the Fund's assets based on the standards specified in paragraph (c)(1) of the Rule; (c) determine that each contract with an Eligible Foreign Custodian shall include the provisions specified in paragraph (c)(2)(i)(A) through (F) of the Rule or, alternatively, in lieu of any or all of such (c)(2)(i)(A) through (F) provisions, such other provisions as BNY determines will provide, in their entirety, the same or a greater level of care and protection for the assets of the Fund as such specified provisions; (d) monitor pursuant to the Monitoring System the appropriateness of maintaining the assets of the Fund with a particular Eligible Foreign Custodian pursuant to paragraph (c)(1) of the Rule and the performance of the contract governing such arrangement; and (e) advise the Fund whenever BNY determines under the Monitoring System that an arrangement (including, any material change in the contract governing such arrangement) described in preceding clause (d) no longer meets the requirements of the Rule. 2. For purposes of clause (d) of preceding Section 1 of this Article, BNY's determination of appropriateness shall not include, nor be deemed to include, any evaluation of Country Risks associated with investment in a particular country. For purposes hereof, "Country Risks" shall mean systemic risks of holding assets in a particular country including but not limited to (a) an Eligible Foreign Custodian's use of any depositories that act as or operate a system or a transnational system for the central handling of securities or any equivalent book-entries; (b) such country's financial infrastructure; (c) such country's prevailing custody and settlement practices; (d) nationalization, expropriation or other governmental actions; (e) regulation of the banking or securities industry; (f) currency controls, restrictions, devaluations or fluctuations; and (g) market conditions which affect the orderly execution of securities transactions or affect the value of securities. ARTICLE IV. REPRESENTATIONS 1. Each Fund hereby represents that: (a) this Agreement has been duly authorized, executed and delivered by the Fund, constitutes a valid and legally binding obligation of the Fund enforceable in accordance with its terms, and no statute, regulation, rule, order, judgment or contract binding on the Fund prohibits the Fund's execution or performance of this Agreement; (b) this Agreement has been approved and ratified by the Board at a meeting duly called and at which a quorum was at all times present, and (c) the Board or the Fund's investment advisor has considered the Country Risks associated with investment in each Specified Country and will have considered such risks prior to any settlement instructions being given to the Custodian with respect to such country. 2. BNY hereby represents that: (a) BNY is duly organized and existing under the laws of the State of New York, with full power to carry on its businesses as now conducted, and to enter into this Agreement and to perform its obligations hereunder; (b) this Agreement has been duly authorized, executed and delivered by BNY, constitutes a valid and legally binding obligation of BNY enforceable in accordance with its terms, and no statute, regulation, rule, order, judgment or contract binding on BNY prohibits BNY's execution or performance of this Agreement; and (c) BNY has established the Monitoring System. ARTICLE V. CONCERNING BNY 1. BNY shall not be liable for any costs, expenses, damages, liabilities or claims, including attorneys' and accountants' fees, sustained or incurred by, or asserted against, the Fund except to the extent the same arises out of the failure of BNY to exercise the care, prudence and diligence required by Section 2 of Article II hereof. In no event shall BNY be liable to the Fund, the Board, or any third party for special, indirect or consequential damages, or for lost profits or loss of business, arising in connection with this Agreement. 2. The Fund shall indemnify BNY and hold it harmless from and against any and all costs, expenses, damages, liabilities or claims, including attorneys' and accountants' fees, sustained or incurred by, or asserted against, BNY by reason or as a result of any action or inaction, or arising out of BNY's performance hereunder, provided that the Fund shall not indemnify BNY to the extent any such costs, expenses, damages, liabilities or claims arises out of BNY's failure to exercise the reasonable care, prudence and diligence required by Section 2 of Article II hereof. 3. For its services hereunder, the Fund agrees to pay to BNY such compensation and out-of-pocket expenses as shall be mutually agreed. 4. BNY shall have only such duties as are expressly set forth herein. In no event shall BNY be liable for any Country Risks associated with investments in a particular country. ARTICLE VI. LIMITED LIABILITY OF EACH FUND BNY acknowledges that is has received notice of and accepts the limitations of liability as set forth in each Fund's Agreement and Declaration of Trust, Articles of Incorporation, or Agreement of Limited Partnership. BNY agrees that each Fund's obligation hereunder shall be limited to the assets of the Fund, and that BNY shall not seek satisfaction of any such obligation from the shareholders of the Fund nor from any Board Member, officer, employee, or agent of the Fund. ARTICLE VII. MISCELLANEOUS 1. This Agreement shall be deemed a separate agreement between each Fund and BNY and constitutes the entire agreement between each Fund and BNY as a foreign custody manager, and no provision in the Custody Agreement between a Fund and the Custodian shall affect the duties and obligations of BNY hereunder, nor shall any provision in this Agreement affect the duties or obligations of the Custodian under the Custody Agreement with a Fund. 2. Any notice or other instrument in writing, authorized or required by this Agreement to be given to BNY, shall be sufficiently given if received by it at its offices at 100 Church Street, 10th Floor,, New York, New York 10286, or at such other place as BNY may from time to time designate in writing. 3. Any notice or other instrument in writing, authorized or required by this Agreement to be given to the Fund shall be sufficiently given if received by it at its offices at 777 Mariners' Island Boulevard, San Mateo, California 94404, Attention: Secretary, or at such other place as the Fund may from time to time designate in writing. 4. In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions shall not in any way be affected thereby. This Agreement may not be amended or modified in any manner except by a written agreement executed by both parties. This Agreement shall extend to and shall be binding upon the parties hereto, and their respective successors and assigns; provided however, that this Agreement shall not be assignable by either party without the written consent of the other. 5. This Agreement shall be construed in accordance with the substantive laws of the State of New York, without regard to conflicts of laws principles thereof. The Fund and BNY hereby consent to the jurisdiction of a state or federal court situated in New York City, New York in connection with any dispute arising hereunder. The Fund hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection which it may now or hereafter have to the laying of venue of any such proceeding brought in such a court and any claim that such proceeding brought in such a court has been brought in an inconvenient forum. The Fund and BNY each hereby irrevocably waives any and all rights to trial by jury in any legal proceeding arising out of or relating to this Agreement. 6. The parties hereto agree that in performing hereunder, BNY is acting solely on behalf of the Fund and no contractual or service relationship shall be deemed to be established hereby between BNY and any other person by reason of this Agreement. 7. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but such counterparts shall, together, constitute only one instrument. 8. This Agreement shall terminate simultaneously with the termination of the Custody Agreement between the Fund and the Custodian, and may otherwise be terminated by either party giving to the other party a notice in writing specifying the date of such termination, which shall be not less than thirty (30) days after the date of such notice. IN WITNESS WHEREOF, the Fund and BNY have caused this Agreement to be executed by their respective officers, thereunto duly authorized, as of the date first above written. EACH INVESTMENT COMPANY LISTED ON SCHEDULE 1 HERETO By: /s/ MURRAY L. SIMPSON ---------------------- Title: Vice President THE BANK OF NEW YORK By: /s/ IRA R. ROSNER ------------------- Title: Ira R. Rosner Vice President
AMENDED AND RESTATED FOREIGN CUSTODY MANAGER AGREEMENT SCHEDULE 1 The following is a list of the Investment Companies and their respective Series for which the Custodian shall serve under the Foreign Custody Manager Agreement dated as of May 16, 2001. ----------------------------------------------------------------------------------------------------------------------------------- INVESTMENT COMPANY ORGANIZATION SERIES ---(IF APPLICABLE) ----------------------------------------------------------------------------------------------------------------------------------- Franklin Custodian Funds, Inc. Maryland Corporation DynaTech Series Growth Series Income Series Utilities Series Franklin Floating Rate Master Trust Delaware Business Trust Franklin Floating Rate Master Series Trust Franklin Gold and Precious Metals Fund Delaware Business Trust Franklin Growth and Income Fund Delaware Business Trust Franklin High Income Trust Delaware Business Trust AGE High Income Fund Franklin Investors Securities Trust Massachusetts Business Trust Franklin Convertible Securities Fund Franklin Equity Income Fund Franklin Floating Rate Daily Access Fund Franklin Global Government Income Fund Franklin Total Return Fund Franklin Managed Trust Delaware Business Trust Franklin Rising Dividends Fund Franklin Mutual Series Fund Inc. Maryland Corporation Mutual Beacon Fund Mutual Discovery Fund Mutual European Fund Mutual Financial Services Fund Mutual Qualified Fund Mutual Shares Fund Franklin Real Estate Securities Trust Delaware Business Trust Franklin Real Estate Securities Fund Franklin Strategic Mortgage Portfolio Delaware Business Trust Franklin Strategic Series Delaware Business Trust Franklin Aggressive Growth Fund Franklin Biotechnology Discovery Fund Franklin Blue Chip Fund Franklin Global Communications Fund Franklin Global Health Care Fund Franklin Large Cap Growth Fund Franklin Natural Resources Fund Franklin Small Cap Growth Fund I Franklin Small Cap Growth Fund II Franklin Strategic Income Fund Franklin Technology Fund Franklin U.S. Long-Short Fund Franklin Templeton Fund Allocator Series Franklin Templeton Conservative Target Fund Franklin Templeton Moderate Target Fund Franklin Templeton Growth Target Fund Franklin Templeton International Trust Templeton Pacific Growth Fund Franklin Templeton Variable Insurance Massachusetts Business Fund Franklin Aggressive Growth Securities Fund Products Trust Franklin Global Communications Securities Fund Franklin Global Health Care Securities Fund Franklin Growth and Income Securities Fund Franklin High Income Fund Franklin Income Securities Fund Franklin Large Cap Growth Securities Fund Franklin Money Market Fund Franklin Natural Resources Securities Fund Franklin Real Estate Fund Franklin Rising Dividends Securities Fund Franklin Small Cap Fund Franklin Strategic Income Securities Fund Franklin S&P 500 Index Fund Franklin Technology Securities Fund Franklin U.S. Government Fund Franklin Value Securities Fund Franklin Zero Coupon Fund - 2005 Franklin Zero Coupon Fund - 2010 Mutual Discovery Securities Fund Mutual Shares Securities Fund Templeton Global Income Securities Fund Franklin Value Investors Trust Massachusetts Business Trust Franklin Balance Sheet Investment Fund Franklin Large Cap Value Fund Franklin MicroCap Value Fund Franklin Value Fund CLOSED END FUNDS: Franklin Floating Rate Trust Delaware Business Trust Franklin Multi-Income Trust Massachusetts Business Trust Franklin Universal Trust Massachusetts Business Trust ----------------------------------------------------------------------------------------------------------------------------------- Revised 5/1/01
SCHEDULE 2 WORLDWIDE NETWORK OF SUBCUSTODIANS COUNTRY SUBCUSTODIAN ------- ------------ Argentina Banco Rio de La Plata Australia National Australia Bank Limited Austria Bank Austria AG Bahrain HSBC Bank Middle East Bangladesh Standard Chartered Bank PLC Belgium Banque Bruxelles Lambert Benin Societe Generale de Banques en Cote d'lvoire Bermuda Bank of Bermuda Limited Bolivia Citibank, N.A. Botswana Barclays Bank of Botswana Ltd. Brazil BankBoston, N.A. Bulgaria ING Bank Burkina Faso Societe Generale de Banques en Cote d'lvoire Canada Royal Bank of Canada Chile BankBoston, N.A. China The Standard Chartered Bank Colombia Cititrust Colombia S.A. Costa Rica Banco BCT Croatia Privredna Banka Zabreb d.d. Cyprus Bank of Cyprus Czech Republic Ceskoslovenska Obchodni Banka A.S. Denmark Danske Bank EASDAQ Banque Bruxelles Lambert Ecuador Citibank, N.A. Egypt Citibank, N.A. Estonia Hansabank, Ltd. Euromarket Clearstream Euromarket Euroclear Finland Merita Bank plc France BNP PARIBAS/Credit Agricole Indosuez Germany Dresdner Bank AG Ghana Barclays Bank of Ghana Ltd. Greece BNP PARIBAS Guinea Bissau Societe Generale de Banques en Cote d'lvoire Hong Kong The Hongkong and Shanghai Banking Corp. Limited Hungary Citibank Budapest Rt. Iceland Landsbanki Islands India The Hongkong and Shanghai Banking Corp.Limited/ Deutsche Bank Indonesia The Hongkong and Shanghai Banking Corp. Limited Ireland Allied Irish Banks plc Israel Bank Leumi Le-Israel B.M. Italy Banca Commerciale Italiana/BNP PARIBAS Ivory Coast Societe Generale de Banques en Cote d'lvoire Jamaica CIBC Trust & Merchant Bank Jamaica Ltd. Japan The Bank of Tokyo-Mitsubishi Limited/The Fuji Bank, Limited Jordan HSBC Bank Middle East Kazakhstan ABN/AMRO Kenya Barclays Bank of Kenya Limited Latvia Hansabanka Limited Lebanon HSBC Bank Middle East Lithuania Vilniaus Bankas Luxembourg Banque et Caisse d'Epargne de L'Etat Malaysia HSBC Bank Malaysia Berhad Mali Societe Generale de Banques en Cote d'lvoire Malta HSBC Bank Malta p.l.c. Mauritius Hongkong and Shanghai Banking Corp. Mexico Banco Nacional de Mexico Morocco Banque Commerciale du Maroc Namibia Stanbic Bank Namibia Limited Netherlands Fortis Bank (Nederland) N.V. New Zealand National Nominees Limited Niger Societe Generale de Banques en Cote d'lvoire Nigeria Stanbic Merchant Bank Nigeria Limited Norway Den norske Bank ASA Oman HSBC Bank Middle East Pakistan Standard Chartered Bank Palestinian Autonomous Area HSBC Bank Middle East, Ramallah Panama BankBoston, N.A. Peru Citibank, N.A. Philippines The Hongkong and Shanghai Banking Corp., Limited Poland Bank Handlowy w Warszawie S.A. Portugal Banco Comercial Portugues, S.A. Qatar HSBC Bank Middle East, Doha Romania ING Bank Russia Credit Suisse First Boston AO/ Vneshtorgbanke (Min Fin Bonds only) Senegal Societe Generale de Banques en Cote d'lvoire Singapore United Overseas Bank Limited/Development Bank of Singapore Slovakia Ceskoslovenska Obchodni Banka, A.S. Bratislava Slovenia Bank Austria Creditanstalt d.d. Ljubljana South Africa Standard Bank of South Africa Limited/Societe Generale, Johannesburg Branch South Korea Standard Chartered Bank Spain Banco Bilbao Vizcaya Argentaria SA / Banco Santander Central Hispano Sri Lanka Standard Chartered Bank Swaziland Stanbic Bank Swaziland Limited Sweden Skandinaviska Enskilda Banken Switzerland Credit Suisse First Boston Taiwan The Hongkong and Shanghai Banking Corporation, Limited Thailand Standard Chartered Bank/Bangkok Bank Public Company Ltd. Togo Societe Generale de Banques en Cote d'lvoire Trinidad & Tobago Republic Bank Limited Tunisia Banque Internationale Arabe de Tunisie Turkey Osmanli Bankasi A.S.(Ottoman Bank) Ukraine ING Bank United Kingdom The Bank of New York/The Depository & Clearing Centre (DCC) United States The Bank of New York Uruguay BankBoston, N.A. Venezuela Citibank, N.A. Zambia Barclays Bank of Zambia Limited Zimbabwe Barclays Bank of Zimbabwe Limited