ICI MUTUAL INSURANCE COMPANY
P.O. Box 730
Burlington, Vermont 05402-0730
INVESTMENT COMPANY BLANKET BOND
ICI MUTUAL INSURANCE COMPANY
P.O. Box 730
Burlington, Vermont 05402-0730
DECLARATIONS
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ITEM 1. Name of Insured (the "Insured") Bond Number
87170108B
FRANKLIN RESOURCES, INC.
Principal Address: One Franklin Parkway
San Mateo, CA 94403-1906
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ITEM 2. Bond Period: from 12:01 a.m. on JUNE 30, 2008, to 12:01 JUNE 30, 2009,
or the earlier effective date of the termination of this Bond,
standard time at the Principal Address as to each of said dates.
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Item 3. Limit of Liability--
Subject to Sections 9, 10, and 12 hereof:
LIMIT OF DEDUCTIBLE
LIABILITY AMOUNT
Insuring Agreement A- FIDELITY $220,000,000 $250,000
Insuring Agreement B- AUDIT EXPENSE $50,000 $10,000
Insuring Agreement C- ON PREMISES $220,000,000 $250,000
Insuring Agreement D- IN TRANSIT $220,000,000 $250,000
Insuring Agreement E- FORGERY OR
ALTERATION $220,000,000 $250,000
Insuring Agreement F- SECURITIES $220,000,000 $250,000
Insuring Agreement G- COUNTERFEIT
CURRENCY $220,000,000 $250,000
Insuring Agreement H- UNCOLLECTIBLE ITEMS
OF DEPOSIT $25,000 $5,000
Insuring Agreement I- PHONE/ELECTRONIC
TRANSACTIONS $220,000,000 $250,000
If "Not Covered" is inserted opposite any Insuring Agreement above,
such Insuring Agreement and any reference thereto shall be deemed to
be deleted from this Bond.
OPTIONAL INSURING AGREEMENTS ADDED BY RIDER:
Insuring Agreement J- COMPUTER SECURITY $220,000,000 $250,000
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ITEM 4. Offices or Premises Covered--All the Insured's offices or other
premises in existence at the time this Bond becomes effective are
covered under this Bond, except the offices or other premises excluded
by Rider. Offices or other premises acquired or established after the
effective date of this Bond are covered subject to the terms of General
Agreement A.
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ITEM 5. The liability of ICI Mutual Insurance Company (the "Underwriter")
is subject to the terms of the following Riders attached hereto:
Riders:
1-2-3-4-5-6-7-8-9-10-11-12-13-14-15-16-17-18-19-20-21-22-23-24-25
and of all Riders applicable to this Bond issued during the Bond Period.
=
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By: /s/ CATHERINE DALTON
Authorized Representative
INVESTMENT COMPANY BLANKET BOND
ICI Mutual Insurance Company (the "Underwriter"), in consideration of an
agreed premium, and in reliance upon the Application and all other
information furnished to the Underwriter by the Insured, and subject to and
in accordance with the Declarations, General Agreements, Provisions,
Conditions and Limitations and other terms of this bond (including all riders
hereto) ("Bond"), to the extent of the Limit of Liability and subject to the
Deductible Amount, agrees to indemnify the Insured for the loss, as described
in the Insuring Agreements, sustained by the Insured at any time but
discovered during the Bond Period.
INSURING AGREEMENTS
A. FIDELITY
Loss (including loss of Property) caused by any Dishonest or Fraudulent Act
or Theft committed by an Employee anywhere, alone or in collusion with
other persons (whether or not Employees), during the time such Employee has
the status of an Employee as defined herein, and even if such loss is not
discovered until after he or she ceases to be an Employee, EXCLUDING loss
covered under Insuring Agreement B.
B. AUDIT EXPENSE
Expense incurred by the Insured for that part of audits or examinations
required by any governmental regulatory authority or Self Regulatory
Organization to be conducted by such authority or Organization or by an
independent accountant or other person, by reason of the discovery of loss
sustained by the Insured and covered by this Bond.
C. ON PREMISES
Loss of Property (including damage thereto or destruction thereof) located
or reasonably believed by the Insured to be located within the Insured's
offices or premises, caused by Theft or by any Dishonest or Fraudulent Act
or through Mysterious Disappearance, EXCLUDING loss covered under Insuring
Agreement A.
D. IN TRANSIT
Loss of Property (including damage thereto or destruction thereof) while
the Property is in transit in the custody of any person authorized by an
Insured to act as a messenger, except while in the mail or with a carrier
for hire (other than a Security Company), EXCLUDING loss covered under
Insuring Agreement A. Property is "in transit" beginning immediately upon
receipt of such Property by the transporting person and ending immediately
upon delivery at the specified destination.
E. FORGERY OR ALTERATION
Loss caused by the Forgery or Alteration of or on (1) any bills of
exchange, checks, drafts, or other written orders or directions to pay
certain sums in money, acceptances, certificates of deposit, due bills,
money orders, or letters of credit; or (2) other written instructions,
requests or applications to the Insured, authorizing or acknowledging the
transfer, payment, redemption, delivery or receipt of Property, or giving
notice of any bank account, which instructions or requests or applications
purport to have been signed or endorsed by (a) any customer of the Insured,
or (b) any shareholder of or subscriber to shares issued by any Investment
Company, or (c) any financial or banking institution or stockbroker; or (3)
withdrawal orders or receipts for the withdrawal of Property, or receipts
or certificates of deposit for Property and bearing the name of the Insured
as issuer or of another Investment Company for which the Insured acts as
agent.
This Insuring Agreement E does not cover loss caused by Forgery or
Alteration of Securities or loss covered under Insuring Agreement A.
F. SECURITIES
Loss resulting from the Insured, in good faith, in the ordinary course of
business, and in any capacity whatsoever, whether for its own account or
for the account of others, having acquired, accepted or received, or sold
or delivered, or given any value, extended any credit or assumed any
liability on the faith of any Securities, where such loss results from the
fact that such Securities (1) were Counterfeit, or (2) were lost or stolen,
or (3) contain a Forgery or Alteration, and notwithstanding whether or not
the act of the Insured causing such loss violated the constitution,
by-laws, rules or regulations of any Self Regulatory Organization, whether
or not the Insured was a member thereof, EXCLUDING loss covered under
Insuring Agreement A.
G. COUNTERFEIT CURRENCY
Loss caused by the Insured in good faith having received or accepted (1)
any money orders which prove to be Counterfeit or to contain an Alteration
or (2) paper currencies or coin of the United States of America or Canada
which prove to be Counterfeit.
This Insuring Agreement G does not cover loss covered under Insuring
Agreement A.
H. UNCOLLECTIBLE ITEMS OF DEPOSIT
Loss resulting from the payment of dividends, issuance of Fund shares or
redemptions or exchanges permitted from an account with the Fund as a
consequence of
(1) uncollectible Items of Deposit of a Fund's customer, shareholder or
subscriber credited by the Insured or its agent to such person's Fund
account, or
(2) any Item of Deposit processed through an automated clearing house
which is reversed by a Fund's customer, shareholder or subscriber and
is deemed uncollectible by the Insured;
PROVIDED, that (a) Items of Deposit shall not be deemed uncollectible until
the Insured's collection procedures have failed, (b) exchanges of shares
between Funds with exchange privileges shall be covered hereunder only if
all such Funds are insured by the Underwriter for uncollectible Items of
Deposit, and (c) the Insured Fund shall have implemented and maintained a
policy to hold Items of Deposit for the minimum number of days stated in
its Application (as amended from time to time) before paying any dividend
or permitting any withdrawal with respect to such Items of Deposit (other
than exchanges between Funds). Regardless of the number of transactions
between Funds in an exchange program, the minimum number of days an Item of
Deposit must be held shall begin from the date the Item of Deposit was
first credited to any Insured Fund.
This Insuring Agreement H does not cover loss covered under Insuring
Agreement A.
I. PHONE/ELECTRONIC TRANSACTIONS
Loss caused by a Phone/Electronic Transaction, where the request for such
Phone/Electronic Transaction:
(1) is transmitted to the Insured or its agents by voice over the telephone
or by Electronic Transmission; and
(2) is made by an individual purporting to be a Fund shareholder or
subscriber or an authorized agent of a Fund shareholder or subscriber;
and
(3) is unauthorized or fraudulent and is made with the manifest intent to
deceive;
PROVIDED, that the entity receiving such request generally maintains and
follows during the Bond Period all Phone/Electronic Transaction Security
Procedures with respect to all Phone/Electronic Transactions; and
EXCLUDING loss resulting from:
(1) the failure to pay for shares attempted to be purchased; or
(2) any redemption of Investment Company shares which had been improperly
credited to a shareholder's account where such shareholder (a) did not
cause, directly or indirectly, such shares to be credited to such
account, and (b) directly or indirectly received any proceeds or other
benefit from such redemption; or
(3) any redemption of shares issued by an Investment Company where the
proceeds of such redemption were requested to be paid or made payable
to other than (a) the Shareholder of Record, or (b) any other person
or bank account designated to receive redemption proceeds (i) in the
initial account application, or (ii) in writing (not to include
Electronic Transmission) accompanied by a signature guarantee; or
(4) any redemption of shares issued by an Investment Company where the
proceeds of such redemption were requested to be sent to other than
any address for such account which was designated (a) in the initial
account application, or (b) in writing (not to include Electronic
Transmission), where such writing is received at least one (1) day
prior to such redemption request, or (c) by voice over the telephone
or by Electronic Transmission at least fifteen (15) days prior to such
redemption; or
(5) the intentional failure to adhere to one or more Phone/Electronic
Transaction Security Procedures; or
(6) a Phone/Electronic Transaction request transmitted by electronic mail
or transmitted by any method not subject to the Phone/Electronic
Transaction Security Procedures; or
(7) the failure or circumvention of any physical or electronic protection
device, including any firewall, that imposes restrictions on the flow of
electronic traffic in or out of any Computer System.
This Insuring Agreement I does not cover loss covered under Insuring
Agreement A, "Fidelity" or Insuring Agreement J, "Computer Security".
GENERAL AGREEMENTS
A. ADDITIONAL OFFICES OR EMPLOYEES--CONSOLIDATION OR MERGER--NOTICE
1. Except as provided in paragraph 2 below, this Bond shall apply to any
additional office(s) established by the Insured during the Bond Period
and to all Employees during the Bond Period, without the need to give
notice thereof or pay additional premiums to the Underwriter for the
Bond Period.
2. If during the Bond Period an Insured Investment Company shall merge or
consolidate with an institution in which such Insured is the surviving
entity, or purchase substantially all the assets or capital stock of
another institution, or acquire or create a separate investment
portfolio, and shall within sixty (60) days notify the Underwriter
thereof, then this Bond shall automatically apply to the Property and
Employees resulting from such merger, consolidation, acquisition or
creation from the date thereof; provided, that the Underwriter may make
such coverage contingent upon the payment of an additional premium.
B. WARRANTY
No statement made by or on behalf of the Insured, whether contained in the
Application or otherwise, shall be deemed to be an absolute warranty, but
only a warranty that such statement is true to the best of the knowledge of
the person responsible for such statement.
C. COURT COSTS AND ATTORNEYS' FEES
The Underwriter will indemnify the Insured against court costs and
reasonable attorneys' fees incurred and paid by the Insured in defense of
any legal proceeding brought against the Insured claiming that the Insured
is liable for any loss, claim or damage which, if established against the
Insured, would constitute a loss sustained by the Insured covered under the
terms of this Bond; provided, however, that with respect to Insuring
Agreement A this indemnity shall apply only in the event that
1. an Employee admits to having committed or is adjudicated to have
committed a Dishonest or Fraudulent Act or Theft which caused the loss;
or
2. in the absence of such an admission or adjudication, an arbitrator or
arbitrators acceptable to the Insured and the Underwriter concludes,
after a review of an agreed statement of facts, that an Employee has
committed a Dishonest or Fraudulent Act or Theft which caused the loss.
The Insured shall promptly give notice to the Underwriter of any such legal
proceeding and upon request shall furnish the Underwriter with copies of
all pleadings and other papers therein. At the Underwriter's election the
Insured shall permit the Underwriter to conduct the defense of such legal
proceeding in the Insured's name, through attorneys of the Underwriter's
selection. In such event, the Insured shall give all reasonable
information and assistance which the Underwriter shall deem necessary to
the proper defense of such legal proceeding.
If the amount of the Insured's liability or alleged liability in any such
legal proceeding is greater than the amount which the Insured would be
entitled to recover under this Bond (other than pursuant to this General
Agreement C), or if a Deductible Amount is applicable, or both, the
indemnity liability of the Underwriter under this General Agreement C is
limited to the proportion of court costs and attorneys' fees incurred and
paid by the Insured or by the Underwriter that the amount which the Insured
would be entitled to recover under this Bond (other than pursuant to this
General Agreement C) bears to the sum of such amount plus the amount which
the Insured is not entitled to recover. Such indemnity shall be in
addition to the Limit of Liability for the applicable Insuring Agreement.
THIS BOND, INCLUDING THE FOREGOING INSURING AGREEMENTS
AND GENERAL AGREEMENTS, IS SUBJECT TO THE FOLLOWING
PROVISIONS, CONDITIONS AND LIMITATIONS:
SECTION 1. DEFINITIONS
The following terms used in this Bond shall have the meanings stated in this
Section:
A. "ALTERATION" means the marking, changing or altering in a material way
of the terms, meaning or legal effect of a document with the intent to
deceive.
B. "APPLICATION" means the Insured's application (and any attachments and
materials submitted in connection therewith) furnished to the
Underwriter for this Bond.
C. "COMPUTER SYSTEM" means (1) computers with related peripheral
components, including storage components, (2) systems and applications
software, (3) terminal devices, (4) related communications networks or
customer communication systems, and (5) related electronic funds
transfer systems; by which data or monies are electronically collected,
transmitted, processed, stored or retrieved.
D. "COUNTERFEIT" means, with respect to any item, one which is false but
is intended to deceive and to be taken for the original authentic item.
E. "DEDUCTIBLE AMOUNT" means, with respect to any Insuring Agreement, the
amount set forth under the heading "Deductible Amount" in Item 3 of the
Declarations or in any Rider for such Insuring Agreement, applicable to
each Single Loss covered by such Insuring Agreement.
F. "DEPOSITORY" means any "securities depository" (other than any foreign
securities depository) in which an Investment Company may deposit its
Securities in accordance with Rule 17f-4 under the Investment Company
Act of 1940.
G. "DISHONEST OR FRAUDULENT ACT" means any dishonest or fraudulent act,
including "larceny and embezzlement" as defined in Section 37 of the
Investment Company Act of 1940, committed with the conscious manifest
intent (1) to cause the Insured to sustain a loss and (2) to obtain
financial benefit for the perpetrator or any other person (other than
salaries, commissions, fees, bonuses, awards, profit sharing, pensions
or other employee benefits). A Dishonest or Fraudulent Act does not mean
or include a reckless act, a negligent act, or a grossly negligent act.
H. "ELECTRONIC TRANSMISSION" means any transmission effected by electronic
means, including but not limited to a transmission effected by telephone
tones, Telefacsimile, wireless device, or over the Internet.
I. "EMPLOYEE" means:
(1) each officer, director, trustee, partner or employee of the
Insured, and
(2) each officer, director, trustee, partner or employee of any
predecessor of the Insured whose principal assets are acquired
by the Insured by consolidation or merger with, or purchase of
assets or capital stock of, such predecessor, and
(3) each attorney performing legal services for the Insured and each
employee of such attorney or of the law firm of such attorney while
performing services for the Insured, and
(4) each student who is an authorized intern of the Insured, while in
any of the Insured's offices, and
(5) each officer, director, trustee, partner or employee of
(a) an investment adviser,
(b) an underwriter (distributor),
(c) a transfer agent or shareholder accounting recordkeeper, or
(d) an administrator authorized by written agreement to keep financial
and/or other required records,
for an Investment Company named as an Insured, but only while (i) such
officer, partner or employee is performing acts coming within the
scope of the usual duties of an officer or employee of an Insured, or
(ii) such officer, director, trustee, partner or employee is acting as
a member of any committee duly elected or appointed to examine or
audit or have custody of or access to the Property of the Insured, or
(iii) such director or trustee (or anyone acting in a similar
capacity) is acting outside the scope of the usual duties of a
director or trustee; provided, that the term "Employee" shall not
include any officer, director, trustee, partner or employee of a
transfer agent, shareholder accounting recordkeeper or administrator
(x) which is not an "affiliated person" (as defined in Section 2(a) of
the Investment Company Act of 1940) of an Investment Company named as
Insured or of the adviser or underwriter of such Investment Company,
or (y) which is a "Bank" (as defined in Section 2(a) of the Investment
Company Act of 1940), and
(6) each individual assigned, by contract or by any agency furnishing
temporary personnel, in either case on a contingent or part-time
basis, to perform the usual duties of an employee in any office of the
Insured, and
(7) each individual assigned to perform the usual duties of an employee or
officer of any entity authorized by written agreement with the Insured
to perform services as electronic data processor of checks or other
accounting records of the Insured, but excluding a processor which
acts as transfer agent or in any other agency capacity for the Insured
in issuing checks, drafts or securities, unless included under
subsection (5) hereof, and
(8) each officer, partner or employee of
(a) any Depository or Exchange,
(b) any nominee in whose name is registered any Security included in
the systems for the central handling of securities established and
maintained by any Depository, and
(c) any recognized service company which provides clerks or other
personnel to any Depository or Exchange on a contract basis, while
while such officer, partner or employee is performing services for
any Depository in the operation of systems for the central handling
ofsecurities, and
(9) in the case of an Insured which is an "employee benefit plan" (as
defined in Section 3 of the Employee Retirement Income Security Act of
1974 ("ERISA")) for officers, directors or employees of another
Insured ("In-House Plan"), any "fiduciary" or other "plan official"
(within the meaning of Section 412 of ERISA) of such In-House Plan,
provided that such fiduciary or other plan official is a director,
partner, officer, trustee or employee of an Insured (other than an
In-House Plan).
Each employer of temporary personnel and each entity referred to in
subsections (6) and (7) and their respective partners, officers and
employees shall collectively be deemed to be one person for all the
purposes of this Bond.
Brokers, agents, independent contractors, or representatives of the same
general character shall not be considered Employees, except as provided in
subsections (3), (6), and (7).
J. "EXCHANGE" means any national securities exchange registered under the
Securities Exchange Act of 1934.
K. "FORGERY" means the physical signing on a document of the name of
another person (whether real or fictitious) with the intent to deceive.
A Forgery may be by means of mechanically reproduced facsimile
signatures as well as handwritten signatures. Forgery does not include
the signing of an individual's own name, regardless of such individual's
authority, capacity or purpose.
L. "ITEMS OF DEPOSIT" means one or more checks or drafts.
M. "INVESTMENT COMPANY" or "FUND" means an investment company registered
under the Investment Company Act of 1940.
N. "LIMIT OF LIABILITY" means, with respect to any Insuring Agreement, the
limit of liability of the Underwriter for any Single Loss covered by
such Insuring Agreement as set forth under the heading "Limit of
Liability" in Item 3 of the Declarations or in any Rider for such
Insuring Agreement.
O. "MYSTERIOUS DISAPPEARANCE" means any disappearance of Property which,
after a reasonable investigation has been conducted, cannot be explained.
P. "NON-FUND" means any corporation, business trust, partnership, trust or
other entity which is not an Investment Company.
Q. "PHONE/ELECTRONIC TRANSACTION SECURITY PROCEDURES" means security
procedures for Phone/Electronic Transactions as provided in writing to
the Underwriter.
R. "PHONE/ELECTRONIC TRANSACTION" means any (1) redemption of shares issued
by an Investment Company, (2) election concerning dividend options
available to Fund shareholders, (3) exchange of shares in a registered
account of one Fund into shares in an identically registered account of
another Fund in the same complex pursuant to exchange privileges of the
two Funds, or (4) purchase of shares issued by an Investment Company,
which redemption, election, exchange or purchase is requested by voice
over the telephone or through an Electronic Transmission.
S. "PROPERTY" means the following tangible items: money, postage and
revenue stamps, precious metals, Securities, bills of exchange,
acceptances, checks, drafts, or other written orders or directions to
pay sums certain in money, certificates of deposit, due bills, money
orders, letters of credit, financial futures contracts, conditional
sales contracts, abstracts of title, insurance policies, deeds,
mortgages, and assignments of any of the foregoing, and other valuable
papers, including books of account and other records used by the Insured
in the conduct of its business, and all other instruments similar to or
in the nature of the foregoing (but excluding all data processing
records), in which the Insured has an interest or in which the Insured
acquired or should have acquired an interest by reason of a
predecessor's declared financial condition at the time of the Insured's
consolidation or merger with, or purchase of the principal assets of,
such predecessor or which are held by the Insured for any purpose or in
any capacity.
T. "SECURITIES" means original negotiable or non-negotiable agreements or
instruments which represent an equitable or legal interest, ownership or
debt (including stock certificates, bonds, promissory notes, and
assignments thereof), which are in the ordinary course of business and
transferable by physical delivery with appropriate endorsement or
assignment. "Securities" does not include bills of exchange,
acceptances, certificates of deposit, checks, drafts, or other written
orders or directions to pay sums certain in money, due bills, money
orders, or letters of credit.
U. "SECURITY COMPANY" means an entity which provides or purports to provide
the transport of Property by secure means, including, without
limitation, by use of armored vehicles or guards.
V. "SELF REGULATORY ORGANIZATION" means any association of investment
advisers or securities dealers registered under the federal securities
laws, or any Exchange.
W. "SHAREHOLDER OF RECORD" means the record owner of shares issued by an
Investment Company or, in the case of joint ownership of such shares,
all record owners, as designated (1) in the initial account application,
or (2) in writing accompanied by a signature guarantee, or (3) pursuant
to procedures as set forth in the Application.
X. "SINGLE LOSS" means:
(1) all loss resulting from any one actual or attempted Theft committed
by one person, or
(2) all loss caused by any one act (other than a Theft or a Dishonest
or Fraudulent Act) committed by one person, or
(3) all loss caused by Dishonest or Fraudulent Acts committed by one
person, or
(4) all expenses incurred with respect to any one audit or examination,
or
(5) all loss caused by any one occurrence or event other than those
specified in subsections (1) through (4) above.
All acts or omissions of one or more persons which directly or indirectly
aid or, by failure to report or otherwise, permit the continuation of an
act referred to in subsections (1) through (3) above of any other person
shall be deemed to be the acts of such other person for purposes of this
subsection.
All acts or occurrences or events which have as a common nexus any fact,
circumstance, situation, transaction or series of facts, circumstances,
situations, or transactions shall be deemed to be one act, one
occurrence, or one event.
Y. "TELEFACSIMILE" means a system of transmitting and reproducing fixed
graphic material (as, for example, printing) by means of signals
transmitted over telephone lines or over the Internet.
Z. "THEFT" means robbery, burglary or hold-up, occurring with or without
violence or the threat of violence.
SECTION 2. EXCLUSIONS
THIS BOND DOES NOT COVER:
A. Loss resulting from (1) riot or civil commotion outside the United
States of America and Canada, or (2) war, revolution, insurrection,
action by armed forces, or usurped power, wherever occurring; except if
such loss occurs in transit, is otherwise covered under Insuring
Agreement D, and when such transit was initiated, the Insured or any
person initiating such transit on the Insured's behalf had no knowledge
of such riot, civil commotion, war, revolution, insurrection, action by
armed forces, or usurped power.
B. Loss in time of peace or war resulting from nuclear fission or fusion or
radioactivity, or biological or chemical agents or hazards, or fire,
smoke, or explosion, or the effects of any of the foregoing.
C. Loss resulting from any Dishonest or Fraudulent Act committed by any
person while acting in the capacity of a member of the Board of
Directors or any equivalent body of the Insured or of any other entity.
D. Loss resulting from any nonpayment or other default of any loan or
similar transaction made by the Insured or any of its partners,
directors, officers or employees, whether or not authorized and whether
procured in good faith or through a Dishonest or Fraudulent Act, unless
such loss is otherwise covered under Insuring Agreement A, E or F.
E. Loss resulting from any violation by the Insured or by any Employee of
any law, or any rule or regulation pursuant thereto or adopted by a Self
Regulatory Organization, regulating the issuance, purchase or sale of
securities, securities transactions upon security exchanges or over the
counter markets, Investment Companies, or investment advisers, unless
such loss, in the absence of such law, rule or regulation, would be
covered under Insuring Agreement A, E or F.
F. Loss of Property while in the custody of any Security Company, unless
such loss is covered under this Bond and is in excess of the amount
recovered or received by the Insured under (1) the Insured's contract
with such Security Company, and (2) insurance or indemnity of any kind
carried by such Security Company for the benefit of, or otherwise
available to, users of its service, in which case this Bond shall cover
only such excess, subject to the applicable Limit of Liability and
Deductible Amount.
G. Potential income, including but not limited to interest and dividends,
not realized by the Insured because of a loss covered under this Bond,
except when covered under Insuring Agreement H.
H. Loss in the form of (1) damages of any type for which the Insured is
legally liable, except direct compensatory damages, or (2) taxes, fines,
or penalties, including without limitation two-thirds of treble damage
awards pursuant to judgments under any statute or regulation.
I. Loss resulting from the surrender of Property away from an office of the
Insured as a result of a threat
(1) to do bodily harm to any person, except loss of Property in transit
in the custody of any person acting as messenger as a result of a
threat to do bodily harm to such person, if the Insured had no
knowledge of such threat at the time such transit was initiated, or
(2) to do damage to the premises or Property of the Insured, unless
such loss is otherwise covered under Insuring Agreement A.
J. All costs, fees and other expenses incurred by the Insured in
establishing the existence of or amount of loss covered under this Bond,
except to the extent certain audit expenses are covered under Insuring
Agreement B.
K. Loss resulting from payments made to or withdrawals from any account,
involving funds erroneously credited to such account, unless such loss
is otherwise covered under Insuring Agreement A.
L. Loss resulting from uncollectible Items of Deposit which are drawn upon
a financial institution outside the United States of America, its
territories and possessions, or Canada.
M. Loss resulting from the Dishonest or Fraudulent Acts, Theft, or other
acts or omissions of an Employee primarily engaged in the sale of shares
issued by an Investment Company to persons other than (1) a person
registered as a broker under the Securities Exchange Act of 1934 or (2)
an "accredited investor" as defined in Rule 501(a) of Regulation D under
the Securities Act of 1933, which is not an individual.
N. Loss resulting from the use of credit, debit, charge, access,
convenience, identification, cash management or other cards, whether
such cards were issued or purport to have been issued by the Insured or
by anyone else, unless such loss is otherwise covered under Insuring
Agreement A.
O. Loss resulting from any purchase, redemption or exchange of securities
issued by an Investment Company or other Insured, or any other
instruction, request, acknowledgement, notice or transaction involving
securities issued by an Investment Company or other Insured or the
dividends in respect thereof, when any of the foregoing is requested,
authorized or directed or purported to be requested, authorized or
directed by voice over the telephone or by Electronic Transmission,
unless such loss is otherwise covered under Insuring Agreement A or
Insuring Agreement I.
P. Loss resulting from any Dishonest or Fraudulent Act or Theft committed
by an Employee as defined in Section 1.I(2), unless such loss (1) could
not have been reasonably discovered by the due diligence of the Insured
at or prior to the time of acquisition by the Insured of the assets
acquired from a predecessor, and (2) arose out of a lawsuit or valid
claim brought against the Insured by a person unaffiliated with the
Insured or with any person affiliated with the Insured.
Q. Loss resulting from the unauthorized entry of data into, or the deletion
or destruction of data in, or the change of data elements or programs
within, any Computer System, unless such loss is otherwise covered under
Insuring Agreement A.
SECTION 3. ASSIGNMENT OF RIGHTS
Upon payment to the Insured hereunder for any loss, the Underwriter shall
be subrogated to the extent of such payment to all of the Insured's rights
and claims in connection with such loss; provided, however, that the
Underwriter shall not be subrogated to any such rights or claims one named
Insured under this Bond may have against another named Insured under this
Bond. At the request of the Underwriter, the Insured shall execute all
assignments or other documents and take such action as the Underwriter may
deem necessary or desirable to secure and perfect such rights and claims,
including the execution of documents necessary to enable the Underwriter to
bring suit in the name of the Insured.
Assignment of any rights or claims under this Bond shall not bind the
Underwriter without the Underwriter's written consent.
SECTION 4. LOSS--NOTICE--PROOF--LEGAL PROCEEDINGS
This Bond is for the use and benefit only of the Insured and the
Underwriter shall not be liable hereunder for loss sustained by anyone
other than the Insured, except that if the Insured includes such other loss
in the Insured's proof of loss, the Underwriter shall consider its
liability therefor. As soon as practicable and not more than sixty (60)
days after discovery of any loss covered hereunder, the Insured shall give
the Underwriter written notice thereof and, as soon as practicable and
within one year after such discovery, shall also furnish to the Underwriter
affirmative proof of loss with full particulars. The Underwriter may
extend the sixty day notice period or the one year proof of loss period if
the Insured requests an extension and shows good cause therefor.
See also General Agreement C (Court Costs and Attorneys' Fees).
The Underwriter shall not be liable hereunder for loss of Securities unless
each of the Securities is identified in such proof of loss by a certificate
or bond number or by such identification means as the Underwriter may
require. The Underwriter shall have a reasonable period after receipt of a
proper affirmative proof of loss within which to investigate the claim, but
where the loss is of Securities and is clear and undisputed, settlement
shall be made within forty-eight (48) hours even if the loss involves
Securities of which duplicates may be obtained.
The Insured shall not bring legal proceedings against the Underwriter to
recover any loss hereunder prior to sixty (60) days after filing such proof
of loss or subsequent to twenty-four (24) months after the discovery of
such loss or, in the case of a legal proceeding to recover hereunder on
account of any judgment against the Insured in or settlement of any suit
mentioned in General Agreement C or to recover court costs or attorneys'
fees paid in any such suit, twenty-four (24) months after the date of the
final judgment in or settlement of such suit. If any limitation in this
Bond is prohibited by any applicable law, such limitation shall be deemed
to be amended to be equal to the minimum period of limitation permitted by
such law.
Notice hereunder shall be given to Manager, Professional Liability Claims,
ICI Mutual Insurance Company, P.O. Box 730, Burlington, Vermont 05402-0730.
SECTION 5. DISCOVERY
For all purposes under this Bond, a loss is discovered, and discovery of a
loss occurs, when the Insured
(1) becomes aware of facts, or
(2) receives notice of an actual or potential claim by a third party which
alleges that the Insured is liable under circumstances,
which would cause a reasonable person to assume that loss covered by this
Bond has been or is likely to be incurred even though the exact amount or
details of loss may not be known.
SECTION 6. VALUATION OF PROPERTY
For the purpose of determining the amount of any loss hereunder, the value
of any Property shall be the market value of such Property at the close of
business on the first business day before the discovery of such loss;
except that
(1) the value of any Property replaced by the Insured prior to the payment
of a claim therefor shall be the actual market value of such Property at
the time of replacement, but not in excess of the market value of such
Property on the first business day before the discovery of the loss of
such Property;
(2) the value of Securities which must be produced to exercise
subscription, conversion, redemption or deposit privileges shall be the
market value of such privileges immediately preceding the expiration
thereof if the loss of such Securities is not discovered until after
such expiration, but if there is no quoted or other ascertainable
market price for such Property or privileges referred to in clauses (1)
and (2), their value shall be fixed by agreement between the parties or
by arbitration before an arbitrator or arbitrators acceptable to the
parties; and
(3) the value of books of accounts or other records used by the Insured in
the conduct of its business shall be limited to the actual cost of blank
books, blank pages or other materials if the books or records are
reproduced plus the cost of labor for the transcription or copying of
data furnished by the Insured for reproduction.
SECTION 7. LOST SECURITIES
The maximum liability of the Underwriter hereunder for lost Securities
shall be the payment for, or replacement of, such Securities having an
aggregate value not to exceed the applicable Limit of Liability. If the
Underwriter shall make payment to the Insured for any loss of securities,
the Insured shall assign to the Underwriter all of the Insured's right,
title and interest in and to such Securities. In lieu of such payment, the
Underwriter may, at its option, replace such lost Securities, and in such
case the Insured shall cooperate to effect such replacement. To effect the
replacement of lost Securities, the Underwriter may issue or arrange for
the issuance of a lost instrument bond. If the value of such Securities
does not exceed the applicable Deductible Amount (at the time of the
discovery of the loss), the Insured will pay the usual premium charged for
the lost instrument bond and will indemnify the issuer of such bond against
all loss and expense that it may sustain because of the issuance of such
bond.
If the value of such Securities exceeds the applicable Deductible Amount
(at the time of discovery of the loss), the Insured will pay a proportion
of the usual premium charged for the lost instrument bond, equal to the
percentage that the applicable Deductible Amount bears to the value of such
Securities upon discovery of the loss, and will indemnify the issuer of
such bond against all loss and expense that
is not recovered from the Underwriter under the terms and conditions of
this Bond, subject to the applicable Limit of Liability.
SECTION 8. SALVAGE
If any recovery is made, whether by the Insured or the Underwriter, on
account of any loss within the applicable Limit of Liability hereunder, the
Underwriter shall be entitled to the full amount of such recovery to
reimburse the Underwriter for all amounts paid hereunder with respect to
such loss. If any recovery is made, whether by the Insured or the
Underwriter, on account of any loss in excess of the applicable Limit of
Liability hereunder plus the Deductible Amount applicable to such loss from
any source other than suretyship, insurance, reinsurance, security or
indemnity taken by or for the benefit of the Underwriter, the amount of
such recovery, net of the actual costs and expenses of recovery, shall be
applied to reimburse the Insured in full for the portion of such loss in
excess of such Limit of Liability, and the remainder, if any, shall be paid
first to reimburse the Underwriter for all amounts paid hereunder with
respect to such loss and then to the Insured to the extent of the portion
of such loss within the Deductible Amount. The Insured shall execute all
documents which the Underwriter deems necessary or desirable to secure to
the Underwriter the rights provided for herein.
SECTION 9. NON-REDUCTION AND NON-ACCUMULATION OF LIABILITY AND TOTAL LIABILITY
Prior to its termination, this Bond shall continue in force up to the Limit
of Liability for each Insuring Agreement for each Single Loss,
notwithstanding any previous loss (other than such Single Loss) for which
the Underwriter may have paid or be liable to pay hereunder; PROVIDED,
however, that regardless of the number of years this Bond shall continue in
force and the number of premiums which shall be payable or paid, the
liability of the Underwriter under this Bond with respect to any Single
Loss shall be limited to the applicable Limit of Liability irrespective of
the total amount of such Single Loss and shall not be cumulative in amounts
from year to year or from period to period.
SECTION 10. MAXIMUM LIABILITY OF UNDERWRITER; OTHER BONDS OR POLICIES
The maximum liability of the Underwriter for any Single Loss covered by any
Insuring Agreement under this Bond shall be the Limit of Liability
applicable to such Insuring Agreement, subject to the applicable Deductible
Amount and the other provisions of this Bond. Recovery for any Single Loss
may not be made under more than one Insuring Agreement. If any Single Loss
covered under this Bond is recoverable or recovered in whole or in part
because of an unexpired discovery period under any other bonds or policies
issued by the Underwriter to the Insured or to any predecessor in interest
of the Insured, the maximum liability of the Underwriter shall be the
greater of either (1) the applicable Limit of Liability under this Bond, or
(2) the maximum liability of the Underwriter under such other bonds or
policies.
SECTION 11. OTHER INSURANCE
Notwithstanding anything to the contrary herein, if any loss covered by
this Bond shall also be covered by other insurance or suretyship for the
benefit of the Insured, the Underwriter shall be liable hereunder only for
the portion of such loss in excess of the amount recoverable under such
other insurance or suretyship, but not exceeding the applicable Limit of
Liability of this Bond.
SECTION 12. DEDUCTIBLE AMOUNT
The Underwriter shall not be liable under any Insuring Agreement unless the
amount of the loss covered thereunder, after deducting the net amount of
all reimbursement and/or recovery received by the Insured with respect to
such loss (other than from any other bond, suretyship or insurance policy
or as an advance by the Underwriter hereunder) shall exceed the applicable
Deductible Amount; in such case the Underwriter shall be liable only for
such excess, subject to the applicable Limit of Liability and the other
terms of this Bond.
No Deductible Amount shall apply to any loss covered under Insuring
Agreement A sustained by any Investment Company named as an Insured.
SECTION 13. TERMINATION
The Underwriter may terminate this Bond as to any Insured or all Insureds
only by written notice to such Insured or Insureds and, if this Bond is
terminated as to any Investment Company, to each such Investment Company
terminated thereby and to the Securities and Exchange Commission,
Washington, D.C., in all cases not less than sixty (60) days prior to the
effective date of termination specified in such notice.
The Insured may terminate this Bond only by written notice to the
Underwriter not less than sixty (60) days prior to the effective date of
the termination specified in such notice. Notwithstanding the foregoing,
when the Insured terminates this Bond as to any Investment Company, the
effective date of termination shall be not less than sixty (60) days from
the date the Underwriter provides written notice of the termination to each
such Investment Company terminated thereby and to the Securities and
Exchange Commission, Washington, D.C.
This Bond will terminate as to any Insured that is a Non-Fund immediately
and without notice upon (1) the takeover of such Insured's business by any
State or Federal official or agency, or by any receiver or liquidator, or
(2) the filing of a petition under any State or Federal statute relative to
bankruptcy or reorganization of the Insured, or assignment for the benefit
of creditors of the Insured.
Premiums are earned until the effective date of termination. The
Underwriter shall refund the unearned premium computed at short rates in
accordance with the Underwriter's standard short rate cancellation tables
if this Bond is terminated by the Insured or pro rata if this Bond is
terminated by the Underwriter.
Upon the detection by any Insured that an Employee has committed any
Dishonest or Fraudulent Act(s) or Theft, the Insured shall immediately
remove such Employee from a position that may enable such Employee to cause
the Insured to suffer a loss by any subsequent Dishonest or Fraudulent
Act(s) or Theft. The Insured, within two (2) business days of such
detection, shall notify the Underwriter with full and complete particulars
of the detected Dishonest or Fraudulent Act(s) or Theft.
For purposes of this section, detection occurs when any partner, officer,
or supervisory employee of any Insured, who is not in collusion with such
Employee, becomes aware that the Employee has committed any Dishonest or
Fraudulent Act(s) or Theft.
This Bond shall terminate as to any Employee by written notice from the
Underwriter to each Insured and, if such Employee is an Employee of an
Insured Investment Company, to the Securities and Exchange Commission, in
all cases not less than sixty (60) days prior to the effective date of
termination specified in such notice.
SECTION 14. RIGHTS AFTER TERMINATION
At any time prior to the effective date of termination of this Bond as to
any Insured, such Insured may, by written notice to the Underwriter, elect
to purchase the right under this Bond to an additional period of twelve
(12) months within which to discover loss sustained by such Insured prior
to the effective date of such termination and shall pay an additional
premium therefor as the Underwriter may require.
Such additional discovery period shall terminate immediately and without
notice upon the takeover of such Insured's business by any State or Federal
official or agency, or by any receiver or liquidator. Promptly after such
termination the Underwriter shall refund to the Insured any unearned
premium.
The right to purchase such additional discovery period may not be exercised
by any State or Federal official or agency, or by any receiver or
liquidator, acting or appointed to take over the Insured's business.
SECTION 15. CENTRAL HANDLING OF SECURITIES
The Underwriter shall not be liable for loss in connection with the central
handling of securities within the systems established and maintained by any
Depository ("Systems"), unless the amount of such loss exceeds the amount
recoverable or recovered under any bond or policy or participants' fund
insuring the Depository against such loss (the "Depository's Recovery"); in
such case the Underwriter shall be liable hereunder only for the Insured's
share of such excess loss, subject to the applicable Limit of Liability,
the Deductible Amount and the other terms of this Bond.
For determining the Insured's share of such excess loss, (1) the Insured
shall be deemed to have an interest in any certificate representing any
security included within the Systems equivalent to the interest the Insured
then has in all certificates representing the same security included within
the Systems; (2) the Depository shall have reasonably and fairly
apportioned the Depository's Recovery among all those having an interest as
recorded by appropriate entries in the books and records of the Depository
in Property involved in such loss, so that each such interest shall share
in the Depository's Recovery in the ratio that the value of each such
interest bears to the total value of all such interests; and (3) the
Insured's share of such excess loss shall be the amount of the Insured's
interest in such Property in excess of the amount(s) so apportioned to the
Insured by the Depository.
This Bond does not afford coverage in favor of any Depository or Exchange
or any nominee in whose name is registered any security included within the
Systems.
SECTION 16. ADDITIONAL COMPANIES INCLUDED AS INSURED
If more than one entity is named as the Insured:
A. the total liability of the Underwriter hereunder for each Single Loss
shall not exceed the Limit of Liability which would be applicable if
there were only one named Insured, regardless of the number of Insured
entities which sustain loss as a result of such Single Loss,
B. the Insured first named in Item 1 of the Declarations shall be deemed
authorized to make, adjust, and settle, and receive and enforce payment
of, all claims hereunder as the agent of each other Insured for such
purposes and for the giving or receiving of any notice required or
permitted to be given hereunder; provided, that the Underwriter shall
promptly furnish each named Insured Investment Company with (1) a copy
of this Bond and any amendments thereto, (2) a copy of each formal
filing of a claim hereunder by any other Insured, and (3) notification
of the terms of the settlement of each such claim prior to the execution
of such settlement,
C. the Underwriter shall not be responsible or have any liability for the
proper application by the Insured first named in Item 1 of the
Declarations of any payment made hereunder to the first named Insured,
D. for the purposes of Sections 4 and 13, knowledge possessed or discovery
made by any partner, officer or supervisory Employee of any Insured
shall constitute knowledge or discovery by every named Insured,
E. if the first named Insured ceases for any reason to be covered under
this Bond, then the Insured next named shall thereafter be considered as
the first named Insured for the purposes of this Bond, and
F. each named Insured shall constitute "the Insured" for all purposes of
this Bond.
SECTION 17. NOTICE AND CHANGE OF CONTROL
Within thirty (30) days after learning that there has been a change in
control of an Insured by transfer of its outstanding voting securities the
Insured shall give written notice to the Underwriter of:
A. the names of the transferors and transferees (or the names of the
beneficial owners if the voting securities are registered in another
name), and
B. the total number of voting securities owned by the transferors and the
transferees (or the beneficial owners), both immediately before and
after the transfer, and
C. the total number of outstanding voting securities.
As used in this Section, "control" means the power to exercise a
controlling influence over the management or policies of the Insured.
SECTION 18. CHANGE OR MODIFICATION
This Bond may only be modified by written Rider forming a part hereof over
the signature of the Underwriter's authorized representative. Any Rider
which modifies the coverage provided by Insuring Agreement A, Fidelity, in
a manner which adversely affects the rights of an Insured Investment
Company shall not become effective until at least sixty (60) days after the
Underwriter has given written notice thereof to the Securities and Exchange
Commission, Washington, D.C., and to each Insured Investment Company
affected thereby.
IN WITNESS WHEREOF, the Underwriter has caused this Bond to be executed on
the Declarations Page.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 1
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED
REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that the following entities shall be deemed to be
Insureds named in Item 1 of the Declarations: (1) any subsidiary more than
55% owned (directly or indirectly) by Franklin Resources, Inc., and (2) any
Investment Company advised, distributed, or administered by Franklin
Resources, Inc. or any of its wholly-owned subsidiaries (individually and/or
collectively referred to as "Franklin"), whether such Investment Company is
considered active, inactive, or dissolved, PROVIDED, IN EACH CASE, that
Franklin has responsibility for placing fidelity bond insurance coverage for
such subsidiary or Investment Company.
It is further understood and agreed that the term "Investment Company," as
used in this rider, shall include any investment company, whether or not
registered under the Investment Company Act of 1940, except that
non-registered investment companies shall not be insured under Insuring
Agreement A, "Fidelity," with respect to $190 million part of the Limit of
Liability set forth in Item 3 of this Bond.
It is further understood and agreed that notwithstanding anything to the
contrary above, none of the following shall be deemed to be, or be otherwise
included as, Insureds for purposes of Item 1 of the Declarations or otherwise
under this Bond: any real estate investment trust, property management
subsidiary, or banking subsidiary (including, without limitation, Franklin
Templeton Bank & Trust, F.S.B., Franklin Bank and Franklin Capital
Corporation).
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 2
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that this Bond does not cover loss resulting from or in
connection with any business, activities, or acts or omissions of (including
services rendered by) any Insured which is NOT an Insured Fund ("Non-Fund")
or any Employee of a Non-Fund, EXCEPT loss, otherwise covered by the terms of
this Bond, resulting from or in connection with professional services within
the scope of the Non-Fund's general business activities rendered by the
Non-Fund to any client of the Non-Fund.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 3
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that this Bond (other than Insuring Agreements C and D)
does not cover loss resulting from or in connection with any business,
activities, acts or omissions of any Insured or any Employee of any Insured
where such loss is based upon, arises out of or in any way involves the
provision of services to any Plan, EXCEPT loss, otherwise covered by the
terms of this Bond, resulting from, or in connection with the business of:
(a) the provision of Investment Advisory Services by an Insured to any
In-House Plan; or
(b) the provision of Administrative Services by an Insured to any In-House
Plan;
(c) the provision of Investment Advisory Services by an Insured ("Adviser")
to any Third Party Plan that is a client of the Adviser; or
(d) the provision of Administrative Services by an Insured to any Third
Party Plan that is a client of the Insured.
It is further understood and agreed that Insuring Agreements C and D only
cover loss of Property which an Insured uses or holds, or in which the Insured
has an interest, in each case in connection with (a), (b), (c) or (d) above.
It is further understood and agreed that notwithstanding the foregoing, this
Bond (other than Insuring Agreements C and D) does not cover loss resulting
from or in connection with, and Insuring Agreements C and D do not cover loss
of Property which an Insured uses or holds, or in which it has an interest, in
each case in connection with:
(1) the discretionary voting by or on behalf of any Plan of Designated
Securities owned or held by such Plan, UNLESS, in the case of a vote by
or on behalf of the Plan, such vote was pursuant to the direction of a
majority of trustees of such Plan who were not then Interested Trustees;
(2) custodial services for the safekeeping and custody of securities or
other property;
(3) liability of an Insured arising from its status as the employer of
employees covered by a Plan (including liability arising from the
Insured's failure to collect contributions or to pay benefits); or
(4) in the case of an Insured acting or purporting to act as a trustee or
"directed trustee" for any Third Party Plan, any liability of the
Insured arising from its actual or alleged status as a fiduciary (within
the meaning of the Employee Retirement Security Act of 1974, as amended
("ERISA")) to any such Third Party Plan or its actual or alleged
violation of Section 502(a)(3) of ERISA, except that this subpart (4)
shall not preclude indemnification for associated court costs and
attorneys' fees for which coverage is otherwise available under General
Agreement C of this Bond.
It is further understood and agreed that for purposes of this rider:
(1) "Administrative Services" shall mean administrative services, including,
without limitation, voting securities which are Plan assets, causing
Plan assets to be invested as directed in accordance with the Plan, and
maintaining records and preparing reports with respect to Plan
contributions, participant accounts and investments.
(2) "Affiliated Entity" means any entity controlling, controlled by, or
under common control with an Insured.
(3) "Designated Securities" means securities issued by an Insured, or by any
Affiliated Entity, or by any Fund to which such Insured or any
Affiliated Entity provides any services.
(4) "Interested Trustee" means any trustee of a Plan who is also (a) an
officer, director, trustee, partner or employee of, or who owns,
controls, or holds power to vote 5% or more of the outstanding voting
securities of, (i) any Insured (other than such Plan), or (ii) any
Affiliated Entity, or (iii) any Fund to which such Insured or any
Affiliated Entity provides any services, or (b) an Insured or an
Affiliated Entity.
(5) "Investment Advisory Services" means (a) advice with respect to the
desirability of investing in, purchasing or selling securities or other
property, including the power to determine what securities or other
property shall be purchased or sold, but NOT including furnishing ONLY
statistical and other factual information (such as economic factors and
trends); and (b) the provision of financial, economic or investment
management services, but only if ancillary and related to the advice
referred to in clause (a) above.
(6) "Plan" means any retirement or employee benefit plan, including any
trust relating thereto.
(7) "In-House Plan" means any Plan for employees of an Insured, or for any
Affiliated Entity, but always excluding employee stock ownership plans,
stock bonus plans, and any trusts relating thereto
(8) "Third Party Plan" means any Plan for employees of an entity that is
neither an Insured nor an Affiliated Entity.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 4
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that notwithstanding anything to the contrary in this
Bond, this Bond shall not cover loss resulting from or in connection with the
discretionary voting by any Insured of securities owned or held by any client
of such Insured, where such securities are issued by (1) such Insured, or (2)
any entity controlling, controlled by, or under common control with such
Insured, ("Affiliated Entity"), or (3) any Fund to which such Insured or any
Affiliated Entity provides any services.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 5
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that notwithstanding Section 2.Q of this Bond, this
Bond is amended by adding an additional Insuring Agreement J as follows:
J. COMPUTER SECURITY
Loss (including loss of Property) resulting directly from Computer Fraud;
PROVIDED, that the Insured has adopted in writing and generally maintains and
follows during the Bond Period all Computer Security Procedures. The
isolated failure of the Insured to maintain and follow a particular Computer
Security Procedure in a particular instance will not preclude coverage under
this Insuring Agreement, subject to the specific exclusions herein and in the
Bond.
1. DEFINITIONS. The following terms used in this Insuring Agreement shall
have the following meanings:
a. "Authorized User" means any person or entity designated by the
Insured (through contract, assignment of User Identification, or
otherwise) as authorized to use a Covered Computer System, or any part
thereof. An individual who invests in an Insured Fund shall not be
considered to be an Authorized User solely by virtue of being an
investor.
b. "Computer Fraud" means the unauthorized entry of data into, or the
deletion or destruction of data in, or change of data elements or
programs within, a Covered Computer System which:
(1) is committed by any Unauthorized Third Party anywhere, alone or
in collusion with other Unauthorized Third Parties; AND
(2) is committed with the conscious manifest intent (a) to cause the
Insured to sustain a loss, AND (b) to obtain financial benefit
for the perpetrator or any other person; AND
(3) causes (x) Property to be transferred, paid or delivered; OR (y)
an account of the Insured, or of its customer, to be added,
deleted, debited or credited; OR (z) an unauthorized or
fictitious account to be debited or credited.
c."Computer Security Procedures" means procedures for prevention of
unauthorized computer access and use and administration of computer
access and use as provided in writing to the Underwriter.
d."Covered Computer System" means any Computer System as to which the
Insured has possession, custody and control.
e."Unauthorized Third Party" means any person or entity that, at the
time of the Computer Fraud, is not an Authorized User.
f."User Identification" means any unique user name (I.E., a series of
characters) that is assigned to a person or entity by the Insured.
2. EXCLUSIONS. It is further understood and agreed that this Insuring
Agreement J shall not cover:
a. Any loss covered under Insuring Agreement A, "Fidelity," of this Bond;
AND
b. Any loss resulting directly or indirectly from Theft or misappropriation
of confidential or proprietary information, material or data
(including but not limited to trade secrets, computer programs or
customer information); AND
c. Any loss resulting from the intentional failure to adhere to one or
more Computer Security Procedures; AND
d. Any loss resulting from a Computer Fraud committed by or in collusion
with:
(1) any Authorized User (whether a natural person or an entity);
OR
(2) in the case of any Authorized User which is an entity, (a)
any director, officer, partner, employee or agent of such
Authorized User, or (b) any entity which controls, is
controlled by, or is under common control with such
Authorized User ("Related Entity"), or (c) any director,
officer, partner, employee or agent of such Related Entity; OR
(3) in the case of any Authorized User who is a natural person,
(a) any entity for which such Authorized User is a director,
officer, partner, employee or agent ("Employer Entity"), or
(b) any director, officer, partner, employee or agent of such
Employer Entity, or (c) any entity which controls, is
controlled by, or is under common control with such Employer
Entity ("Employer-Related Entity"), or (d) any director,
officer, partner, employee or agent of such Employer-Related
Entity;
AND
e. Any loss resulting from physical damage to or destruction of any
Covered Computer System, or any part thereof, or any data, data
elements or media associated therewith; AND
f. Any loss resulting from Computer Fraud committed by means of wireless
access to any Covered Computer System, or any part thereof, or any
data, data elements or media associated therewith; AND
g. Any loss not directly and proximately caused by Computer Fraud
(including, without limitation, disruption of business and extra
expense); AND
h. Payments made to any person(s) who has threatened to deny or has
denied authorized access to a Covered Computer System or otherwise has
threatened to disrupt the business of the Insured.
For purposes of this Insuring Agreement, "Single Loss," as defined in Section
1.X of this Bond, shall also include all loss caused by Computer Fraud(s)
committed by one person, or in which one person is implicated, whether or not
that person is specifically identified. A series of losses involving
unidentified individuals, but arising from the same method of operation, may
be deemed by the Underwriter to involve the same individual and in that event
shall be treated as a Single Loss.
It is further understood and agreed that nothing in this Rider shall affect
the exclusion set forth in Section 2.0 of this Bond.
Coverage under this Insuring Agreement shall terminate upon termination of
this Bond. Coverage under this Insuring Agreement may also be terminated
without terminating this Bond as an entirety:
(a) by written notice from the Underwriter not less than sixty (60) days
prior to the effective date of termination specified in such notice;
or
(b) immediately by written notice from the Insured to the Underwriter.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 6
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that the exclusion set forth at Section 2.M of this
Bond shall not apply with respect to loss resulting from the Dishonest or
Fraudulent Acts, Theft, or other acts or omissions of an Employee in
connection with offers or sales of securities issued by an Insured Fund if
such Employee (a) is an employee of that Fund or of its investment adviser,
principal underwriter, or affiliated transfer agent, and (b) who is
communicating with purchasers of such securities only in person in an office
of an Insured or by telephone or in writing, and (c) does not receive
commissions on such sales; PROVIDED, that such Dishonest or Fraudulent Acts,
Theft, or other acts or omissions do not involve, and such loss does not
arise from, a statement or representation which is NOT (1) contained in a
currently effective prospectus regarding such securities, which has been
filed with the Securities and Exchange Commission, or (2) made as part of a
scripted response to a question regarding that Fund or such securities, if
the script has been filed with, and not objected to by, the National
Association of Securities Dealers, Inc., and if the entire scripted response
has been read to the caller, and if any response concerning the performance
of such securities is not outdated.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 7
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that this Bond does not cover any loss resulting from
or in connection with the acceptance of any Third Party Check, unless
(1) such Third Party Check is used to open or increase an account which
is registered in the name of one or more of the payees on such Third
Party Check, and
(2) reasonable efforts are made by the Insured, or by the entity
receiving Third Party Checks on behalf of the Insured, to verify all
endorsements on all Third Party Checks made payable in amounts
greater than $100,000 (provided, however, that the isolated failure
to make such efforts in a particular instance will not preclude
coverage, subject to the exclusions herein and in the Bond),
and then only to the extent such loss is otherwise covered under this Bond.
For purposes of this Rider, "Third Party Check" means a check made payable to
one or more parties and offered as payment to one or more other parties.
It is further understood and agreed that notwithstanding anything to the
contrary above or elsewhere in the Bond, this Bond does not cover any loss
resulting from or in connection with the acceptance of a Third Party Check
where:
(1) any payee on such Third Party Check reasonably appears to be a
corporation or other entity; or
(2) such Third Party Check is made payable in an amount greater than
$100,000 and does not include the purported endorsements of all
payees on such Third Party Check.
It is further understood and agreed that this Rider shall not apply with
respect to any coverage that may be available under Insuring Agreement A,
"Fidelity."
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 8
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that no termination or cancellation of this Bond as an
entirety, whether by or at the request of the Insured or Underwriter, shall
take effect prior to the expiration of thirty (30) days after written notice
of such termination or cancellation of such Bond as an entirety has been
filed with the Arkansas Securities Commissioner, Arkansas Securities
Division, Heritage West Building, 3rd Floor, 201 East Markham, Little Rock,
Arkansas 72201.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 9
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that notwithstanding anything to the contrary in this
Bond (including Insuring Agreement I), this Bond does not cover loss caused
by a Phone/Electronic Transaction requested:
o by wireless device transmissions over the Internet (including any
connected or associated intranet or extranet),
except insofar as such loss is covered under Insuring Agreement A "Fidelity"
of this Bond.
It is further understood and agreed that, for the purposes of this Rider, a
transmission of a Phone/Electronic Transaction request over the Internet
shall not be deemed to be a "wireless device transmission" solely by virtue
of an individual retail shareholder's use of a personal wireless device
(e.g., a PDA, Blackberry, cell phone, or wireless access point on such
shareholder's home network) to effect transmission of such request to the
shareholder's Internet service provider.
Except as above stated, nothing herein shall be held to alter, waive, or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 10
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
FINRA BOND RIDER
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that with respect to Templeton Franklin Investment
Services, Inc. ONLY, this Bond is amended as follows:
1. For purposes of Insuring Agreement C ("On Premises"), Sections 2
("Exclusions"), and Section 6 ("Valuation of Property"), "Property" shall
be deemed to include furnishings, fixtures, supplies, and equipment located
within the office of and owned by the Insured; and
2. For purposes of Insuring Agreement C ("On Premises"), "Mysterious
Disappearances" shall be deemed to include "misplacement."
3. The last sentence of Section 1.I ("Definitions - `Employee") and Section
2.M are deleted; and
4. The following statement is added to the Bond: "The Underwriter will use
its best efforts to promptly notify the Financial Industry Regulatory
Authority, Inc. in the event the Bond is cancelled, terminated or
substantially modified. Failure to make such notification shall not impair
or delay the effectiveness of any such cancellation, termination or
substantial modification."; and
5. The first sentence of the second paragraph of Section 13 ("Termination") is
amended to read as follows: "The Insured may terminate this Bond only by
written notice to the Underwriter prior to the effective date of the
termination, with such effective date specified in the notice;" and
6. With respect to the following Insuring Agreements, Item 3 of the
Declarations is modified to read as follows:
Deductible
Amount
Insuring Agreement A - Fidelity $5,000
Insuring Agreement B - Audit Expense $5,000
Insuring Agreement C - On Premises $5,000
Insuring Agreement D - In Transit $5,000
Insuring Agreement E - Forgery or
Alteration $5,000
Insuring Agreement F - Securities $5,000
Insuring Agreement G - Counterfeit
Currency $5,000
It is further understood and agreed, the Underwriter will use its best
efforts to notify the Financial Industry Regulatory Authority, Inc. within 30
days in the event the Bond is substantially modified, terminated or
canceled.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 11
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
FINRA BOND RIDER
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that with respect to Franklin Templeton Distributors,
Inc. ONLY, this Bond is amended as follows:
1. For purposes of Insuring Agreement C ("On Premises"), Sections 2
("Exclusions"), and Section 6 ("Valuation of Property"), "Property" shall
be deemed to include furnishings, fixtures, supplies, and equipment
located within the office of and owned by the Insured; and
2. For purposes of Insuring Agreement C ("On Premises"), "Mysterious
Disappearances" shall be deemed to include "misplacement."
3. The last sentence of Section 1.I ("Definitions - `Employee") and Section
2.M are deleted; and
4. The following statement is added to the Bond: "The Underwriter will use
its best efforts to promptly notify the Financial Industry Regulatory
Authority, Inc. in the event the Bond is cancelled, terminated or
substantially modified. Failure to make such notification shall not impair
or delay the effectiveness of any such cancellation, termination or
substantial modification."; and
5. The first sentence of the second paragraph of Section 13 ("Termination") is
amended to read as follows: "The Insured may terminate this Bond only by
written notice to the Underwriter prior to the effective date of the
termination, with such effective date specified in the notice;" and
6. With respect to the following Insuring Agreements, Item 3 of the
Declarations is modified to read as follows:
Deductible
Amount
Insuring Agreement A - Fidelity $100,000
Insuring Agreement B - Audit Expense $100,000
Insuring Agreement C - On Premises $100,000
Insuring Agreement D - In Transit $100,000
Insuring Agreement E - Forgery or
Alteration $100,000
Insuring Agreement F - Securities $100,000
Insuring Agreement G - Counterfeit
Currency $100,000
It is further understood and agreed, the Underwriter will use its best
efforts to notify the Financial Industry Regulatory Authority, Inc. within 30
days in the event the Bond is substantially modified, terminated or
canceled.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 12
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that the definition of "Employee" in Section 1.I(6) of
this Bond shall be amended to include any individual assigned, on a
contingent or part-time basis, to perform the usual duties of an employee in
any office of the Insured, PROVIDED that in the case of an individual
assigned other than by an agency furnishing temporary personnel, such
individual has passed a Successful Background Check conducted by or on behalf
of the Insured.
It is further understood and agreed that for purposes of this rider, a
"Successful Background Check" shall mean a background check (including contact
with the individual's previous employers and personal references and
utilization of a private investigation agency), which results in a
determination by the Insured that the individual has satisfied the security
criteria established by the Insured for hiring employees on a permanent
basis.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 13
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that:
1. At the written request of the named Insured, any payment in satisfaction of
loss covered by said bond involving money or other Property in which the
Pennsylvania Public School Employees' Retirement System has an interest
shall be paid by an instrument issued to that organization and the named
Insured as joint loss payees, subject to the following conditions and
limitation:
A. The attached bond is for the sole use and benefit of the named Insured
as expressed herein. The organization named above shall not be
considered as an Insured under the bond, nor shall it otherwise have
any rights or benefits under said bond.
B. Notwithstanding any payment made under the terms of this rider or the
execution of more than one of such similar rider, the amount paid for
any one loss occurrence or otherwise in accordance with the terms of
this bond shall not exceed the limits of liability as set forth in the
Declarations Page.
C. Nothing herein is intended to alter the terms, conditions and
limitations of the bond.
2. Should this bond be canceled, reduced, non-renewed or restrictively
modified by the Underwriter, the Underwriter will endeavor to give thirty
(30) days advance notice to the organization named above, but failure to do
so shall not impair or delay the effectiveness of any such cancellation,
reduction, non-renewal, or restrictive modification, nor shall the
Underwriter be held liable in any way.
3. Should this bond be canceled or reduced at the request of the Insured, the
Underwriter will endeavor to notify the organization named above of such
cancellation or reduction, within 10 business days after receipt of such
request, but failure to do so shall not impair or delay the effectiveness
of such cancellation or reduction, nor shall the Underwriter be held liable
in any way.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 14
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that the sixth paragraph of Section 13 of this Bond is
amended to read as follows:
"For purposes of this section, detection occurs when any professional
employee of the Legal, Compliance or Risk Management Departments of the
Insured, who is not in collusion with such Employee, becomes aware that the
Employee has committed any Dishonest or Fraudulent Act(s) or Theft."
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 15
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that Section 2.H of this Bond is amended to read as
follows:
"H. Loss in the form of (1) damages of any type for which the Insured is
legally liable, except direct compensatory damages or punitive damages, or
(2) taxes, fines, or penalties, including without limitation two-thirds of
treble damage awards pursuant to judgments under any statute or regulation."
Nothing herein contained shall be held to vary, alter, waive or extend any of
the terms, conditions, provisions, agreements or limitations of this Bond
other than as above stated.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 16
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that:
1. This Bond shall not be subject to cancellation except after notice in
writing shall have been not less than thirty (30) days prior to the
effective date thereof by certified mail, return receipt requested,
addressed to the City Attorney at:
City Attorney
City of Los Angeles
c/o City Employees' Retirement System
360 East Second Street, 8th Floor
Los Angeles, CA 90012-4207
2. This Company agrees to waive all rights of subrogation against the City
of Los Angeles, its departments, officers, agents, and employees.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 17
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
FINRA BOND RIDER
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that with respect to Franklin Templeton Financial
Services Corp. ONLY, this Bond is amended as follows:
1. For purposes of Insuring Agreement C ("On Premises"), Sections 2
("Exclusions"), and Section 6 ("Valuation of Property"), "Property" shall
be deemed to include furnishings, fixtures, supplies, and equipment
located within the office of and owned by the Insured; and
2. For purposes of Insuring Agreement C ("On Premises"), "Mysterious
Disappearances" shall be deemed to include "misplacement."
3. The last sentence of Section 1.I ("Definitions - `Employee") and Section
2.M are deleted; and
4. The following statement is added to the Bond: "The Underwriter will use
its best efforts to promptly notify the Financial Industry Regulatory
Authority, Inc. in the event the Bond is cancelled, terminated or
substantially modified. Failure to make such notification shall not impair
or delay the effectiveness of any such cancellation, termination or
substantial modification."; and
5. The first sentence of the second paragraph of Section 13 ("Termination") is
amended to read as follows: "The Insured may terminate this Bond only by
written notice to the Underwriter prior to the effective date of the
termination, with such effective date specified in the notice;" and
6. With respect to the following Insuring Agreements, Item 3 of the
Declarations is modified to read as follows:
Limit of Deductible
Liability Amount
Insuring Agreement A - Fidelity $150,000 $5,000
Insuring Agreement B - Audit Expense $25,000 $5,000
Insuring Agreement C - On Premises $150,000 $5,000
Insuring Agreement D - In Transit $150,000 $5,000
Insuring Agreement E - Forgery or
Alteration $150,000 $5,000
Insuring Agreement F - Securities $150,000 $5,000
Insuring Agreement G - Counterfeit
Currency $150,000 $5,000
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 18
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that notwithstanding anything to the contrary in Rider
No. 1 to this Bond, the FTCI Insureds shall be deemed to be Insureds named in
Item 1 of the Declarations.
It is further understood and agreed that with respect to the FTCI Insureds
only, this Bond is modified as follows:
1. INSURING AGREEMENT A, FIDELITY: With regards to any loss to a FTCI
Insured under Insuring Agreement A, Fidelity, arising from Loans and/or
Trading, the Dishonest or Fraudulent Act or Theft required under
Insuring Agreement A must be committed with the intent to obtain, and
must result in, a financial benefit (other than salaries, commissions,
fees, bonuses, awards, profit sharing, pensions or other employee
benefits) for (a) the Employee, or (b) person(s) with whom the Employee
is in collusion if the Employee intended to participate in such
financial benefit.
2. INSURING AGREEMENT D, IN TRANSIT: Employees of Xerox Corporation
authorized by a FTCI Insured to act as a messengers shall be deemed to
be a "Security Company" for purposes of Insuring Agreement D, In
Transit, PROVIDED that such employees have passed the same background
check and security clearance as is customarily required by the FTCI
Insured of its own employees.
3. INSURING AGREEMENT I, PHONE/ELECTRONIC TRANSACTIONS: "Phone/Electronic
Transaction" shall be deemed to include any transfer of funds by a FTCI
Insured from an account of a Client of a FTCI Insured to another
account(s), where such transfer is requested by voice over the telephone
or through a Telefacsimile System by a person purporting to be a Client
of the FTCI Insured or an authorized representative of the Client,
provided that the FTCI Insured receiving such request generally
maintains and follows during the Bond Period those recording and
verification procedures in place as of March 2001 and described to the
Underwriter as of such date.
4. DEFINITIONS, SECTION 1.S: With respect to the FTCI Insureds,
notwithstanding anything to the contrary in the definition of "Property"
set forth in Section 1.S of the Bond, "Property" as defined in Section
1.S shall be deemed to include jewelry, gems, tangible items of personal
property, and electronic data stored on media for use by computer
programs.
5. SECTION 2. EXCLUSIONS: With respect to FTCI Insureds, the following
additional exclusions are added to Section 2, Exclusions:
(1) Loss resulting directly or indirectly from Trading, with or without
the knowledge of the FTCI Insured, whether or not represented by an
indebtedness or balance shown to be due to FTCI Insured on any
customer's account, actual or fictitious, and notwithstanding any
act or omission on the part of any Employee in connection with any
account relating to such Trading, indebtedness, or balance, except
when covered under Insuring Agreements A, E or F;
(2) Loss of Property contained in customers' safe deposit boxes, except
when the FTCI Insured is legally liable therefor or the loss is
covered under Insuring Agreement A;
(3) (a) Loss through cashing or paying Forged or Altered travelers' checks
or travelers' checks bearing forged endorsements, except when covered
under Insuring Agreement A, and (b) loss of unsold travelers' checks
or unsold money orders placed in the custody of the FTCI Insured with
authority to sell, unless the Insured is legally liable for such loss
and such checks or money orders are later paid or honored by the
drawer thereof, except when covered under Insuring Agreement A;
(4) Loss in the form of a shortage in any teller's cash due to error,
regardless of the amount of such shortage (and any shortage in any
teller's cash which is not in excess of the normal shortage in the
tellers' cash in the office where such shortage shall occur shall be
presumed to be due to error);
(5) Loss involving automated mechanical devices which, on behalf of the
FTCI Insured, disburse money, accept deposits, cash checks, drafts or
similar written instruments or make credit card loans unless (a) such
automated mechanical devices are situated within an office of a FTCI
Insured which is permanently staffed by an Employee whose duties are
those usually assigned to a teller, even though public access to such
devices is from outside the confines of such office, or (b) such
automated mechanical devices are not situated within an office covered
above, but in no event shall the Underwriter be liable under this Bond
for loss (including loss of Property):
(i) as a result of damage to such automated mechanical devices
situated within any office referred to in (a) above resulting
from vandalism or malicious mischief perpetrated from outside
such office; or
(ii) as a result of damage to such automated mechanical devices
situated on any premises referred to in (b) above resulting from
vandalism or malicious mischief, or
(iii) as a result of damage to the interior of that portion of a
building on any premises referred to in (b) above to which the
public has access resulting from vandalism or malicious mischief;
or
(iv) as a result of failure of such automated mechanical devices to
function properly; or
(v) through misplacement or mysterious unexplainable disappearance
while such Property is located within any such automated
mechanical devices, or
(vi) to any customer of a FTCI Insured or to any representative of
such customer while such person is on any premises referred to in
(b) above, or
(vii) as a result of the use of credit, debit, charge, access,
convenience, identification or other cards in gaining access to
such automated mechanical devices whether such cards were issued,
or purport to have been issued, by the FTCI Insured or by anyone
other than the FTCI Insured,
except when such loss is covered under Insuring Agreement A.
(6) Loss resulting directly or indirectly from the failure of a
financial or depository institution, or its receiver or liquidator,
to pay or deliver, on demand of the FTCI Insured, funds or Property
of the FTCI Insured held by it in any capacity, except when covered
under Insuring Agreements A or C;
(7) Loss resulting from or involving, directly or indirectly, any
actual or alleged seepage, pollution or contamination of any kind;
(8) Loss resulting from or involving, directly or indirectly, any
actual or alleged hazardous properties (including, but not limited
to, radiation, toxic or explosive properties) of nuclear material,
including but not limited to, the actual, alleged, threatened or
potential ionizing radiations or contamination by radioactivity
from nuclear fuel, nuclear waste or combustion of nuclear fuel, or
the radioactive, toxic, explosive or hazardous properties of any
explosive nuclear assembly or nuclear or nuclear component thereof.
It is further understood and agreed that as used in this Rider:
1. "Client" means any corporation, partnership, proprietor, trust or
individual having an account with a FTCI Insured and which has a
written agreement with the FTCI Insured for transfers of funds through
requests made by voice over the telephone or by Telefacsimile System.
2. "FTCI Insureds" shall mean Fiduciary Trust Company International
("FTCI"), and each of its direct and indirect wholly-owned
subsidiaries, including pension, profit-sharing or other benefit plans
established for employees of FTCI and such subsidiaries.
3. "Loans" shall mean all extensions of credit by a FTCI Insured(s)
and all transactions creating a creditor or lessor relationship in
favor of the FTCI Insured(s) and all transactions by which the FTCI
Insured(s) assumes an existing creditor or lessor relationship.
4. "Trading" means trading or other dealings in securities, commodities,
futures, options, foreign or federal funds, currencies, foreign
exchange and the like.
Except as above stated, nothing herein shall be held to alter, waiver or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 19
-------------------------------------------------------------------------------
INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that the references in Section 13, Termination, to "not
less than sixty (60) days" shall be modified to read "not less than ninety
(90) days."
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 20
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration for the premium charged for this Bond, it is hereby
understood and agreed that notwithstanding anything to the contrary in this
Bond (including Insuring Agreement I), this Bond does not cover any loss
resulting from any On-Line Redemption(s) or On-Line Purchase(s) involving an
aggregate amount in excess of $250,000 per shareholder account per day.
It is further understood and agreed that, notwithstanding the Limit of
Liability set forth herein or any other provision of this Bond, the Limit of
Liability with respect to any Single Loss caused by an On-Line Transaction
shall be Ten Million Dollars ($10,000,000) and the On-Line Deductible with
respect to Insuring Agreement I is Fifty Thousand Dollars ($50,000).
It is further understood and agreed that notwithstanding Section 8,
Non-Reduction and Non-Accumulation of Liability and Total Liability, or any
other provision of this Bond, the Aggregate Limit of Liability of the
Underwriter under this Bond with respect to any and all loss or losses caused
by On-Line Transactions shall be an aggregate of Ten Million Dollars
($10,000,000) for the Bond Period, irrespective of the total amount of such
loss or losses.
For purposes of this Rider, the following terms shall have the following
meanings:
"On-Line Purchase" means any purchase of shares issued by an Investment
Company, which purchase is requested by computer-to-computer transmissions
over the Internet (including any connected or associated intranet or
extranet) or utilizing modem or similar connections.
"On-Line Redemption" means any redemption of shares issued by an Investment
Company, which redemption is requested by computer-to computer transmissions
over the Internet (including any connected or associated intranet or
extranet) or utilizing modem or similar connections.
"On-Line Transaction" means any Phone/Electronic Transaction requested by
computer-to-computer transmissions over the Internet (including any connected
or associated intranet or extranet) or utilizing modem or similar
connections.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 21
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
Most property and casualty insurers, including ICI Mutual Insurance Company
("ICI Mutual"), are subject to the requirements of the Terrorism Risk
Insurance Act of 2002 (the "Act"). The Act establishes a Federal insurance
backstop under which ICI Mutual and these other insurers will be partially
reimbursed for future "INSURED LOSSES" resulting from certified "ACTS OF
TERRORISM." (Each of these BOLDED TERMS is defined by the Act.) The Act
also places certain disclosure and other obligations on ICI Mutual and these
other insurers.
Pursuant to the Act, any future losses to ICI Mutual caused by certified
"ACTS OF TERRORISM" will be partially reimbursed by the United States
government under a formula established by the Act. Under this formula, the
United States government will reimburse ICI Mutual for 90% of ICI Mutual's
"INSURED LOSSES" in excess of a statutorily established deductible until total
insured losses of all participating insurers reach $100 billion. If total
"insured losses" of all property and casualty insurers reach $100 billion
during any applicable period, the Act provides that the insurers will not be
liable under their policies for their portions of such losses that exceed
such amount. Amounts otherwise payable under this bond may be reduced as a
result.
This bond has no express exclusion for "ACTS OF TERRORISM." However,
coverage under this bond remains subject to all applicable terms, conditions
and limitations of the bond (including exclusions) that are permissible
under the Act. The portion of the premium that is attributable to any
coverage potentially available under the bond for "ACTS OF TERRORISM" is one
percent (1%).
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 22
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
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EFFECTIVE DATE BOND PERIOD AUTHORIZED
REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond it hereby understood
and agreed that notwithstanding anything to the contrary in Rider No. 1, no
Hedge Fund shall be deemed to be, or otherwise included as, an Insured for
purposes of Item 1 of the Declarations or otherwise under this Bond.
It is further understood and agreed that for purposes of this rider, a Hedge
Fund shall mean an investment company that is not registered under the
Investment Company Act of 1940 ("1940 Act") that may use various high-risk
strategies generally unavailable to investment companies registered under the
1940 Act, such as unlimited short positions, significant leverage, and
concentrated positions in securities of issuers.
For purposes of this rider the following shall not be considered to be Hedge
Funds:
Algebra Capital
Templeton Global Long-Short Fund PLC
Mutual Recovery Fund, LTD
Templeton Global Long-Short Fund LTD
Franklin US Long-Short Fund PLC
At any time during the Bond period the Insured may submit to the Underwriter
underwriting information for any newly created Hedge Fund. Within 30 days
of receipt of all underwriting information, the Underwriter will notify the
Insured whether or not the newly created Hedge Fund will be exempt from the
above exclusion.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 23
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that notwithstanding anything to the contrary in Rider
1, Item 1 of the Declarations, Name of Insured, shall include the following
(each, herein referred to as a "Joint Venture"):
Algebra Capital
Templeton Capital Advisors, Ltd.
Franklin Templeton Sealand Fund Management Company
Franklin/Templeton Securities Investment (Sino Am) Inc.
Franklin Templeton First Taiwan Securities Investment Trust Enterprise
Lightning Asset Finance Ltd.
Lightning Finance Company Limited
China Life Franklin Asset Management Co., Limited
JJF Equity Fund Management Co., Ltd.
Vietcombank Fund Management
It is further understood and agreed that notwithstanding anything to the
contrary in this Bond (including, without limitation, Section 10): (1) the
maximum liability of the Underwriter for any Single Loss sustained by any
Joint Venture shall be limited to that percentage of such Single Loss as is
equal to Franklin Resources, Inc.'s ownership percentage of such Joint
Venture ("Proportionate Loss"), and (2) the Proportionate Loss shall be
subject to the full applicable Deductible Amount set forth in Item 3 of the
Declarations.
It is further understood and agreed that notwithstanding anything to the
contrary above or elsewhere in this Bond (including, without limitation, Item
3 of the Declarations, Section 9, or Section 10), the maximum aggregate
liability of the Underwriter under this Bond with respect to any and all
losses sustained by any and all Joint Ventures shall be Twenty Million
Dollars ($20,000,000).
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 24
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that:
1. At the written request of the named Insured, any payment in satisfaction of
loss covered by said bond involving money or other Property in which the
Pennsylvania State Employees' Retirement System has an interest shall be
paid by an instrument issued to that organization and the named Insured as
joint loss payees, subject to the following conditions and limitation:
A. The attached bond is for the sole use and benefit of the named Insured
as expressed herein. The organization named above shall not be
considered as an Insured under the bond, nor shall it otherwise have
any rights or benefits under said bond.
B. Notwithstanding any payment made under the terms of this rider or the
execution of more than one of such similar rider, the amount paid for
any one loss occurrence or otherwise in accordance with the terms of
this bond shall not exceed the limits of liability as set forth in the
Declarations Page.
C. Nothing herein is intended to alter the terms, conditions and
limitations of the bond.
2. Should this bond be canceled, reduced, non-renewed or restrictively
modified by the Underwriter, the Underwriter will endeavor to give thirty
(30) days advance notice to the organization named above, but failure to do
so shall not impair or delay the effectiveness of any such cancellation,
reduction, non-renewal, or restrictive modification, nor shall the
Underwriter be held liable in any way.
3. Should this bond be canceled or reduced at the request of the Insured, the
Underwriter will endeavor to notify the organization named above of such
cancellation or reduction, within 10 business days after receipt of such
request, but failure to do so shall not impair or delay the effectiveness
of such cancellation or reduction, nor shall the Underwriter be held liable
in any way.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
ICI MUTUAL INSURANCE COMPANY
INVESTMENT COMPANY BLANKET BOND
RIDER NO. 25
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INSURED BOND NUMBER
FRANKLIN RESOURCES, INC. 87170108B
-------------------------------------------------------------------------------
EFFECTIVE DATE BOND PERIOD AUTHORIZED REPRESENTATIVE
JUNE 30, 2008 JUNE 30, 2008 TO JUNE 30, 2009 /s/ CATHERINE DALTON
===============================================================================
In consideration of the premium charged for this Bond, it is hereby
understood and agreed that:
1. In the event that a loss is covered under more than one bond
issued to Franklin Resources, Inc. or any affiliates thereof
issued by ICI Mutual Insurance Company, the total liability of
ICI Mutual Insurance Company under all implicated bonds in
combination shall not exceed the applicable Limit of Liability of
the largest of the implicated bonds. In no event shall the
applicable Limits of Liability of each of the implicated bonds be
added together or otherwise combined to determine the total
liability of ICI Mutual Insurance Company.
Except as above stated, nothing herein shall be held to alter, waive or
extend any of the terms of this Bond.
CERTIFICATE OF SECRETARY
Franklin California Tax-Free Income Fund
Franklin California Tax-Free Trust
Franklin Capital Growth Fund
Franklin Custodian Funds
Franklin Federal Tax-Free Income Fund
Franklin Floating Rate Master Trust
Franklin Global Trust
Franklin Gold and Precious Metals Fund
Franklin High Income Trust
Franklin Investors Securities Trust
Franklin Managed Trust
Franklin Money Fund
Franklin Municipal Securities Trust
Franklin Mutual Recovery Fund
Franklin Mutual Series Funds
Franklin New York Tax-Free Income Fund
Franklin New York Tax-Free Trust
Franklin Real Estate Securities Trust
Franklin Strategic Mortgage Portfolio
Franklin Strategic Series
Franklin Tax-Exempt Money Fund
Franklin Tax-Free Trust
Franklin Templeton Fund Allocator Series
Franklin Templeton Global Trust
Franklin Templeton International Trust
Franklin Templeton Limited Duration Income Trust
Franklin Templeton Money Fund Trust
Franklin Templeton Variable Insurance Products Trust
Franklin Universal Trust
Franklin Value Investors Trust
Institutional Fiduciary Trust
The Money Market Portfolios
I, Karen S. Skidmore, Vice President and Secretary or Assistant Secretary of
the above referenced investment companies (each, together with its respective
series, a "Fund" or "Funds") hereby certify that the following is a true and
correct copy of resolutions duly adopted by the Board of Trustees of each
Fund, including a majority of the Trustees who are not "interested persons"
of the Funds, as such term is defined in the Investment Company Act of 1940,
at a Joint Meeting of Directors/Trustees of the Funds held on May 20, 2008,
and further certify that said resolutions are in full force and effect in all
respects, subject in some cases to final approval by the Board of
Directors/Trustees of the minutes of such meetings:
RESOLVED, that after consideration of the value of the aggregate
assets of the Funds to which any covered person may have access,
the type and terms of the arrangements made for the custody and
safekeeping of such assets, and the nature of the securities in the
Funds' portfolios, among other factors, the existing fidelity bond
joint coverage for the Franklin Templeton Group of Funds and
Franklin Templeton non-SEC registered funds in the amount of
$220,000,000 obtained with the ICI Mutual Insurance Company under
arrangements providing for a specifically allocated priority layer
of $190,000,000 coverage for the Funds and other members of the SEC
registered Franklin Templeton Group of Funds be continued, subject
to ongoing review; and
FURTHER RESOLVED, in accordance with the provisions of subparagraph
(e) of Rule 17g-1 under the Investment Company Act of 1940, and
after consideration of the number of other parties named as
insureds, the nature of the business activities of such other
parties, the amount of the joint insured bond, the amount of the
premium for such bond, the ratable allocation of the premium among
all parties named as insureds, and the extent to which the share of
the premium allocated to each Fund is less than the premium such
Fund would have had to pay if it had provided and maintained a
single insured bond, among other factors, the portion of the
premium for said Bond to be paid by each Fund, be and it hereby is
approved as to amount and shall be the portion of the allocable
premiums paid by all covered investment companies constituting the
Franklin Templeton Group of Funds equal to the percentage that the
Fund's assets represent in respect to assets of all of such covered
investment companies in the aggregate; and
FURTHER RESOLVED, that the existing Amended and Restated Allocation
Agreement between the Funds and the other covered persons under the
bond relating to the sharing of premiums and division of insurance
proceeds in the event of a joint fidelity loss, as required by
subparagraph (f) of Rule 17g-1, and reflecting the provisions of
said Bond, is hereby approved and continued; and
FURTHER RESOLVED, that the Secretary or any Assistant Secretary of
the Funds be, and he or she hereby is, authorized, empowered and
directed to make such filings with the U.S. Securities and Exchange
Commission as may be required from time to time pursuant to Rules
under the Investment Company Act of 1940.
/s/ KAREN L. SKIDMORE
Karen L. Skidmore
Vice President and Secretary or
Assistant Secretary
Dated: JULY 30, 2008
CERTIFICATE OF ASSISTANT SECRETARY OF
TEMPLETON GROWTH FUND, INC. ("TGF")
TEMPLETON FUNDS ("TF")
Templeton World Fund ("TWF")
Templeton Foreign Fund ("TFF")
TEMPLETON GLOBAL SMALLER COMPANIES FUND ("TGSCF")
TEMPLETON INCOME TRUST ("TIT")
Templeton Global Bond Fund ("TGBF")
Templeton International Bond Fund ("TIBF")
TEMPLETON DEVELOPING MARKETS TRUST ("TDMT")
TEMPLETON GLOBAL OPPORTUNITIES TRUST ("TGOT")
TEMPLETON INSTITUTIONAL FUNDS ("TIF")
Foreign Equity Series ("FES")
Emerging Markets Series ("EMS")
Foreign Smaller Companies Series ("FSCS")
Global Equity Series ("GES")
TEMPLETON GLOBAL INVESTMENT TRUST ("TGIT")
Templeton BRIC Fund ("TBRICF")
Templeton Income Fund ("TINC")
Templeton Emerging Markets Small Cap Fund ("TEMSCF")
TEMPLETON CHINA WORLD FUND ("TCWF")
TEMPLETON EMERGING MARKETS FUND ("TEMF")
TEMPLETON GLOBAL INCOME FUND ("TGIF")
TEMPLETON EMERGING MARKETS INCOME FUND ("TEMIF")
TEMPLETON DRAGON FUND, INC. ("TDF")
TEMPLETON RUSSIA AND EAST EUROPEAN FUND, INC. ("TRF")
I, Lori A. Weber, Assistant Secretary of the above referenced investment
companies (each, together with its respective series, a "Fund"), hereby
certify that the following is a true and correct copy of resolutions duly
adopted by the Board of Directors/Trustees of each Fund, including a majority
of the Directors/Trustees who are not "interested persons" of the Fund, as
such term is defined in the Investment Company Act of 1940 (the "1940 Act"),
at the regular meetings of Directors/Trustees of each Fund held on May 20,
2008, and further certify that said resolutions are in full force and effect
in all respects, subject to final approval by the Board of Directors/Trustees
of the minutes of such meetings:
RESOLVED, that after consideration of the value of the
aggregate assets of the Funds to which any covered person
may have access, the type and terms of the arrangements
made for the custody and safekeeping of such assets and
the nature of the securities in the Funds' portfolios,
among other factors, the existing fidelity bond joint
coverage for the Franklin Templeton Group of Funds and
Franklin Templeton non-U.S. Securities and Exchange
Commission ("SEC") registered funds in the amount of
$220,000,000 obtained with the ICI Mutual Insurance
Company under arrangements providing for a specifically
allocated priority layer of $190,000,000 coverage for the
Funds and other members of the SEC registered Franklin
Templeton Group of Funds be continued, subject to ongoing
review; and it was further
RESOLVED, in accordance with the provisions of
subparagraph (e) of Rule 17g-1 under the 1940 Act, and
after consideration of the number of other parties named
as insureds, the nature of the business activities of
such other parties, the amount of the joint insured bond,
the amount of the premium for such bond, the ratable
allocation of the premium among all parties named as
insureds and the extent to which the share of the premium
allocated to each Fund is less than the premium such Fund
would have had to pay if it had provided and maintained a
single insured bond, among other factors, the portion of
the premium for said bond to be paid by each Fund be, and
it hereby is, approved as to amount and shall be the
portion of the allocable premiums paid by all covered
investment companies constituting the Franklin Templeton
Group of Funds equal to the percentage that the Fund's
assets represent in respect to the assets of all of such
covered investment companies in the aggregate; and it was
further
RESOLVED, that the existing Amended and Restated
Allocation Agreement between the Funds and the other
covered persons under the bond relating to the sharing of
premiums and division of insurance proceeds in the event
of a joint fidelity loss, as required by subparagraph (f)
of Rule 17g-1, and reflecting the provisions of said
Bond, is hereby approved and continued; and it was further
RESOLVED, that the Secretary or any Assistant Secretary
of the Funds be, and he or she hereby is, authorized,
empowered and directed to make such filings with the SEC
as may be required from time to time pursuant to Rules
under the 1940 Act.
And it was further
RESOLVED, that the participation by the Funds in the
combined ICI Mutual Directors and Officers/Errors and
Omissions Liability Insurance Policy in conjunction with
other members of the Franklin Templeton Group of Funds,
Franklin Resources and affiliates and specified Franklin
Templeton non-SEC registered funds, is in the best
interests of the Funds; and it was further
RESOLVED, that existing combined ICI Mutual Directors and
Officers/Errors and Omissions Liability Insurance
coverage for the Funds and other members of the Franklin
Templeton Group of Funds, Franklin Resources and
affiliates and Franklin Templeton non-SEC funds be
maintained at the current level of $100,000,000; and it
was further
RESOLVED, that the current layer of $50,000,000 coverage
available solely for the benefit of the Independent
Directors/Trustees of the funds within the Franklin
Templeton Group of Funds as well as the current
additional $10,000,000 layer for the benefit of
Independent Directors/Trustees of both SEC registered
funds and Franklin Templeton non-SEC funds under the
Independent Directors Safety Net Insurance Program
provided under the combined ICI Mutual Directors and
Officers/Errors and Omissions Liability Insurance, in
addition to the current $100,000,000 aggregate coverage
to be continued; and it was further
RESOLVED, that the proposed allocation to the Funds of
the premium for such policy as presented to the meetings
be, and it hereby is, approved as being fair and
reasonable, based upon each Fund's proportionate share of
the sum of the premiums that would have been paid if such
insurance coverage were purchased separately by the
insured parties, and in compliance with the provisions of
Rule 17d-1(d)(7) under the 1940 Act.
/s/ LORI A. WEBER
Lori A. Weber
Assistant Secretary
DATED: July 18, 2008
FRANKLIN TEMPLETON SEC REGISTERED FUNDS IN THE USA
PREMIUM ALLOCATION BASED ON JUNE 30, 2008 NET ASSET VALUES
BOND PERIOD OF JUNE 30, 2008 TO JUNE 30, 2009
------------------------------------------------------------------------------------------------------------------------------
ADVISOR FUND TIS NAME OF FUND BOND
PREMIUM
NAV ALLOCATION
------------------------------------------------------------------------------------------------------------------------------
Franklin Advisors, Inc. 21 4021 Franklin Floating Rate Master Series $ 464,263,262 $ 1,083
Franklin Advisors, Inc. 132 4301 Franklin Gold & Precious Metals Fund 2,039,465,007 4,759
Franklin Advisors, Inc. 134 4303 Franklin Capital Growth Fund 1,335,840,171 3,117
FRANKLIN HIGH INCOME TRUST (1)
Franklin Advisors, Inc. 105 4305 Franklin High Income Fund 2,490,963,838 5,813
FRANKLIN CUSTODIAN FUNDS (5)
Franklin Investment
Advisory Services 106 4306 Franklin Growth Fund 2,575,300,763 6,010
Franklin Advisors, Inc. 107 4307 Franklin Utilities Fund 2,724,790,629 6,359
Franklin Advisors, Inc. 108 4308 Franklin DynaTech Fund 549,025,511 1,281
Franklin Advisors, Inc. 109 4309 Franklin Income Fund 56,934,459,838 132,864
Franklin Advisors, Inc. 110 4110 Franklin US Government Sec. Fund 6,692,380,342 15,618
Franklin Advisors, Inc. 112 4312 Franklin California Tax-Free Income Fund 14,348,090,980 33,483
Franklin Advisors, Inc. 115 4315 Franklin New York Tax-Free Income Fund 5,373,667,156 12,540
Franklin Advisors, Inc. 116 4316 Franklin Federal Tax-Free Income Fund 8,061,402,894 18,812
FRANKLIN TAX-FREE TRUST (24)
Franklin Advisors, Inc. 118 4318 Franklin Massachusetts Insured Tax-Free 47,822,160 1,278
Income Fund
Franklin Advisors, Inc. 119 4319 Franklin Michigan Insured Tax-Free Income 1,580,226,867 3,688
Fund
Franklin Advisors, Inc. 120 4320 Franklin Minnesota Insured Tax-Free Income 676,005,410 1,578
Fund
Franklin Advisors, Inc. 121 4321 Franklin Insured Tax-Free Income Fund 2,279,966,403 5,321
Franklin Advisors, Inc. 122 4322 Franklin Ohio Insured Tax-Free Income Fund 1,356,043,139 3,165
Franklin Advisors, Inc. 123 4323 Franklin Double Tax-Free Income Fund 583,999,362 1,363
Franklin Advisors, Inc. 126 4726 Franklin Arizona Tax-Free Income Fund 1,075,323,671 2,509
Franklin Advisors, Inc. 127 4327 Franklin Colorado Tax-Free Income Fund 546,064,666 1,274
Franklin Advisors, Inc. 128 4328 Franklin Georgia Tax-Free Income Fund 344,886,503 805
Franklin Advisors, Inc. 129 4329 Franklin Pennsylvania Tax-Free Income Fund 989,828,891 2,310
Franklin Advisors, Inc. 130 4330 Franklin High Yield Tax-Free Income Fund 6,074,263,407 14,175
Franklin Advisors, Inc. 154 4354 Franklin Federal Limited Term Tax-Free Income 62,871,465 147
Franklin Advisors, Inc. 160 4360 Franklin Missouri Tax-Free Income Fund 761,146,126 1,776
Franklin Advisors, Inc. 161 4361 Franklin Oregon Tax-Free Income Fund 894,393,044 2,087
Franklin Advisors, Inc. 163 4363 Franklin Virginia Tax-Free Income Fund 598,527,923 1,397
Franklin Advisors, Inc. 164 4364 Franklin Alabama Tax-Free Income Fund 288,001,482 672
Franklin Advisors, Inc. 165 4365 Franklin Florida Tax-Free Income Fund 1,476,623,577 3,446
Franklin Advisors, Inc. 166 4366 Franklin Connecticut Tax-Free Income Fund 416,631,593 972
Franklin Advisors, Inc. 168 4368 Franklin Louisiana Tax-Free Income Fund 301,066,984 703
Franklin Advisors, Inc. 169 4369 Franklin Maryland Tax-Free Income Fund 550,272,302 1,284
Franklin Advisors, Inc. 170 4370 Franklin North Carolina Tax-Free Income Fund 895,031,242 2,089
Franklin Advisors, Inc. 171 4371 Franklin New Jersey Tax-Free Income Fund 1,431,888,151 3,342
Franklin Advisors, Inc. 172 4172 Franklin Kentucky Tax-Free Income Fund 161,249,746 376
Franklin Advisors, Inc. 174 4174 Franklin Federal Intermediate-Term Tax-Free 814,913,667 1,902
Income Fund
FRANKLIN CALIFORNIA TAX-FREE TRUST (4)
Franklin Advisors, Inc. 124 4324 Franklin Calif. Insured Tax-Free Income Fund 2,088,969,834 4,875
Franklin Advisors, Inc. 125 4325 Franklin Calif. Tax-Exempt Money Fund 713,105,100 1,664
Franklin Advisors, Inc. 152 4152 Franklin Calif. Intermediate-Term Tax-Free 555,016,175 1,295
Income Fund
Franklin Advisors, Inc. 155 4155 Franklin Calif. Limited Term Tax-Free Income 24,972,548 58
Fund
FRANKLIN NEW YORK TAX-FREE TRUST (4)
Franklin Advisors, Inc. 131 4331 Franklin New York Tax -Exempt Money Fund 72,292,200 169
Franklin Advisors, Inc. 153 4153 Franklin New York Intermediate-Term Tax-Free 35,084,402 782
Income Fund
Franklin Advisors, Inc. 156 4156 Franklin New York Limited Tax-Free Income Fund 23,717,644 55
Franklin Advisors, Inc. 181 4181 Franklin New York Insured Tax-Free Income Fund 571,449,808 1,334
FRANKLIN GLOBAL TRUST (9)
Fiduciary International Inc. 64 5567 Fiduciary Large Capitalization Growth and 78,402,864 183
Income Fund
Fiduciary International Inc. 66 5566 Fiduciary Small Capitalization Equity Fund 24,208,638 56
Fiduciary International Inc. 67 4469 Franklin Templeton High Income Fund 5,844,394 14
Franklin Templeton Institutiona Franklin International Growth Fund
429 12517 4,649,146 11
Fiduciary International Inc. 664 4470 Franklin Templeton Core Plus Fixed Income Fund 104,749,538 244
Fiduciary International Inc. 667 4471 Franklin Templeton Core Fixed Income Fund 17,484,747 41
Franklin Advisors, Inc. 681 4643 Franklin Internation Small Cap Growth Fund 24,364,988 57
Franklin Templeton Institutiona 495 4496 Franklin Global Real Estate Fund 100,276,120 234
Franklin Templeton Investment
Management Limited 699 4493 Franklin Templeton Emerging Mrkt Debt Opp Fd 80,003,735 187
FRANKLIN INVESTORS SECURITIES TRUST (9)
Franklin Advisors, Inc. 136 4336 Franklin Limited Maturity U.S. Govt Sec. Fund 244,239,921 570
Franklin Advisors, Inc. 137 4337 Franklin Convertible Securities Fund 859,614,569 2,006
Franklin Advisors, Inc. 138 4338 Franklin Adjustable U.S. Government Secs Fund 460,984,777 1,076
Franklin Advisors, Inc. 139 4339 Franklin Equity Income Fund 810,675,762 1,892
Franklin Advisors, Inc. 401 4991 Franklin Low Duration Total Return Fund 27,070,523 63
Franklin Advisors, Inc. 423 4990 Franklin Real Return Fund 243,302,133 568
Franklin Advisors, Inc. 424 4586 Franklin Balanced Fund 60,675,996 142
Franklin Advisors, Inc. 460 4460 Franklin Total Return Fund 1,399,533,526 3,266
Franklin Advisors, Inc. 489 4489 Franklin Floating Rate Daily Access Fund 1,484,208,419 3,464
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS
TRUST (23)
Franklin Advisors, Inc. 714 4834 Franklin Zero-Coupon Fund - 2010 119,551,984 279
Templeton Investment Council,
LLC 715 155 Templeton Global Asset Allocation Fund 123,702,221 289
Templeton Asset Management Ltd. 717 381 Templeton Developing Markets Securities Fund 1,370,831,295 3,384
Templeton Investment Council,
LLC 719 523 Templeton Foreign Securities Fund 3,522,906,530 8,221
Franklin Advisors, Inc. 721 4843 Franklin Large Cap Growth Securities Fund 607,558,696 1,418
Franklin Advisors, Inc. 723 4842 Franklin Smal-Mid Cap Growth Sec. Fund 1,163,615,136 2,715
Franklin Advisory Services LLC 728 4411 Franklin Large Cap Value Securities Fund 39,548,172 92
Franklin Advisors, Inc. 729 4410 Franklin Flex Cap Growth Securities Fund 264,505,233 617
Templeton Global Advisors
Limited 739 4840 Templeton Growth Securities Fund 2,952,869,483 7,290
Franklin Advisors, Inc. 741 4827 Templeton Global Income Securities Fund 1,096,180,256 2,558
Franklin Mutual Advisers, LLC. 743 4846 Mutual Shares Securities Fund 5,198,490,035 12,131
Franklin Advisors, Inc. 745 4821 Franklin Money Market Fund 36,870,874 86
Franklin Mutual Advisers, LLC. 753 4845 Mutual Discovery Securities Fund 1,735,938,908 4,051
Franklin Advisors, Inc. 755 4825 Franklin Global Communications Securities Fund 224,176,351 523
Franklin Advisors, Inc. 767 4822 Franklin Growth & Income Securities Fund 489,453,820 1,142
Franklin Advisors, Inc. 769 4829 Franklin Income Securities Fund 7,700,621,124 17,970
Franklin Advisors, Inc. 771 4824 Franklin Global Real Estate Fund 693,911,589 1,619
Franklin Advisory Services LLC 773 4836 Franklin Rising Dividends Securities Fund 1,993,492,375 4,652
Franklin Advisory Services LLC 775 4848 Franklin Small Cap Value Securities Fund 1,147,119,353 2,677
Franklin Advisors, Inc. 777 4826 Franklin High Income Securities Fund 189,263,668 442
Franklin Advisors, Inc. 779 4884 Franklin Strategic Income Securities Fund 1,160,511,873 2,708
Franklin Advisors, Inc. 781 4830 Franklin U.S. Gov't Fund 547,516,713 1,278
Franklin Advisors, Inc. 783 11536 Franklin Templeton VIP Founding Funds
Allocation Fund 391,930,023 915
FRANKLIN MUNICIPAL SECURITIES TRUST (2)
Franklin Advisors, Inc. 175 4175 Franklin CA High Yield Municipal Fund 1,553,768,397 3,626
Franklin Advisors, Inc. 420 4220 Franklin TN Municipal Bond Fund 199,728,817 466
FRANKLIN MANAGED TRUST (1)
Franklin Advisory Services LLC 158 4358 Franklin Rising Dividends Fund 2,221,963,643 5,185
FRANKLIN TEMPLETON LIMITED DURATION INCOME
TRUST (1)
Franklin Advisors, Inc. 3637 4472 Franklin Templeton Limited Duration Income 346,521,005 809
Trust
FRANKLIN TEMPLETON INTERNATIONAL TRUST (3)
Franklin Advisors, Inc. 141 12054 Franklin India Growth Fund 48,687,746 114
Franklin Templeton Investments
Corp. 191 4191 Templeton Foreign Smaller Companies Fund 344,968,294 852
Franklin Advisors, Inc. 467 2800 Templeton Global Long - Short Fund 244,013,204 569
FRANKLIN STRATEGIC SERIES (11)
Franklin Advisors, Inc. 180 4180 Franklin Flex Cap Growth Fund 2,811,242,855 6,560
Franklin Advisors, Inc. 194 4194 Franklin Strategic Income Fund 3,235,343,824 7,550
Franklin Advisors, Inc. 197 4197 Franklin Global Communications Fund 102,637,256 240
Franklin Advisors, Inc. 198 4198 Franklin Small-Mid Cap Growth Fund 5,483,913,708 12,797
Franklin Advisors, Inc. 199 4199 Franklin Global Healthcare Fund 137,247,365 320
Franklin Advisors, Inc. 402 4402 Franklin Biotechnology Discovery Fund 333,618,975 779
Franklin Advisors, Inc. 403 4403 Franklin Natural Resources Fund 1,090,243,069 2,544
Franklin Focused Core Equity Fund
Franklin Advisors, Inc. 443 12053 4,858,747 11
Franklin Advisors, Inc. 462 4462 Franklin Growth Opportunities Fund 308,768,018 721
Franklin Advisors, Inc. 463 4463 Franklin Technology Fund 56,879,169 133
Franklin Advisors, Inc. 465 4465 Franklin Small Cap Growth Fund II 579,166,977 1,352
FRANKLIN VALUE INVESTORS TRUST (6)
Franklin Advisory Services LLC 150 4150 Franklin Balance Sheet Investment Fund 3,560,070,726 8,308
Franklin Advisory Services LLC 189 4189 Franklin MicroCap Value Fund 378,147,608 882
Franklin Advisory Services LLC 422 4297 Franklin MidCapValue Fund 76,581,471 179
Franklin Advisory Services LLC 448 11579 Franklin All Cap Value Fund 12,860,269 30
Franklin Advisory Services LLC 480 4480 Franklin Large Cap Value Fund 175,687,819 410
Franklin Advisory Services LLC 482 4282 Franklin Small Cap Value Fund 1,202,756,767 2,807
Franklin Advisors, Inc. 2 4002 Franklin Universal Trust 182,995,544 427
Franklin Advisors, Inc. 111 4311 Franklin Money Fund 2,489,448,004 5,809
Franklin Advisors, Inc. 114 4314 Franklin Tax-Exempt Money Fund 167,779,027 392
Franklin Advisors, Inc. 157 4157 Franklin Strategic Mortgage Portfolio 191,326,605 446
Franklin Advisors, Inc. 192 4192 Franklin Real Estate Securities Trust 407,638,442 951
FRANKLIN TEMPLETON MONEY FUND TRUST (1)
Franklin Advisors, Inc. 311 4511 Franklin Templeton Money Fund 292,348,784 682
INSTITUTIONAL FIDUCIARY TRUST (2)
Franklin Advisors, Inc. 140 4340 Money Market Portfolio 4,078,167,317 9,517
Franklin Advisors, Inc. 149 4149 Franklin Cash Reserves Fund 150,098,847 350
Franklin Templeton Fund Allocator Series
(10)(FTFAS)
Franklin Advisors, Inc. 185 723 Franklin Templeton Perspectives Allocation Fund 276,687,640 646
Franklin Advisors, Inc. 427 4389 FTFAS-Franklin Templeton 2015 Retirement Target 16,757,642 39
Fund
Franklin Advisors, Inc. 445 4390 FTFAS-Franklin Templeton 2025 Retirement Target 13,728,131 32
Fund
Franklin Advisors, Inc. 446 4391 FTFAS-Franklin Templeton 2035 Retirement Target 7,742,898 18
Fund
Franklin Advisors, Inc. 451 4392 FTFAS-Franklin Templeton 2045 Retirement Target 4,563,295 11
Fund
Franklin Advisors, Inc. 470 4467 Franklin Templeton Corefolio Allocation Fund 633,744,096 1,479
Franklin Advisors, Inc. 481 4468 Franklin Templeton Founding Funds Allocation 13,363,886,554 31,186
Fund
Franklin Advisors, Inc. 484 4484 Franklin Templeton Conservative Target Fund 457,240,665 1,067
Franklin Advisors, Inc. 485 4485 Franklin Templeton Moderate Target Fund 728,491,483 1,700
486 4486 Franklin Templeton Growth Target Fund 544,837,522 1,271
THE MONEY MARKET PORFOLIOS (1) (TMMP)
Franklin Advisors, Inc. 184 4184 Money Market Portfolio 7,013,568,325 16,367
FRANKLIN TEMPLETON GLOBAL TRUST (1)
Franklin Advisors, Inc. 412 4212 Franklin Templeton Hard Currency Fund 691,359,987 1,613
Franklin Mutual Advisers, LLC. 471 4447 Franklin Mutual Recovery Fund 375,985,938 877
Templeton Global Advisors
Limited 101 105 Templeton Growth Fund, Inc. 28,919,932,032 71,396
Franklin Templeton
Investments Corp. 103 30 Templeton Global Smaller Companies Fund 1,190,628,834 2,939
TEMPLETON FUNDS (2)
Templeton Global Advisors
Limited 102 31 Templeton World Fund 8,163,722,626 20,154
Templeton Global Advisors
Limited 104 37 Templeton Foreign Fund 10,003,707,914 24,697
Templeton Investment
Counsel, LLC
415 201 Templeton Global Opportunities Trust 1,081,859,485 2,525
TEMPLETON INCOME TRUST (2)
Franklin Advisors, Inc. 406 97 Templeton Global Bond Fund 10,625,609,804 24,796
Franklin Advisors, Inc. 447 12052 Templeton International Bond Fund 15,128,388 35
TEMPLETON GLOBAL INVESTMENT TRUST (3)
Templeton BRIC Fund
Templeton Asset Management Ltd. 405 4494 941,134,567 2,323
Templeton Income Fund
Templeton Global Advisors Limited 425 4290 1,013,237,383 2,501
Templeton Emerging Markets Small Cap Fund
Templeton Asset Management Ltd. 426 4398 96,106,002 237
Templeton Investment Counsel, LLC TEMPLETON INSTITUTIONAL FUNDS (4)
Templeton Investment Council, LLC 442 12332 Global Equity Series 118,286,005 276
Templeton Investment Council, LLC 454 243 Foreign Equity Series 7,448,793,181 17,383
Templeton Asset Management Ltd. 456 540 Emerging Markets Series Fund 2,600,292,992 6,419
Franklin Advisors, Inc. 458 4562 Foreign Smaller Companies Series 122,533,933 286
Franklin Advisors, Inc. 946 146 Templeton Global Income Fund 1,146,189,931 2,675
Franklin Advisors, Inc. 555 555 Templeton Emerging Markets Income Fund 670,023,676 1,564
Templeton Asset Management Ltd. 581 581 Templeton Dragon Fund, Inc. 1,088,812,969 2,688
Templeton Asset Management Ltd. 911 111 Templeton Emerging Markets Fund 392,295,556 968
Templeton Asset Management Ltd. 711 505 Templeton Developing Markets Trust 4,354,422,366 10,750
Templeton Asset Management Ltd. 188 4473 Templeton China World Fund 938,407,568 2,317
Templeton Asset Management Ltd. 337 337 Templeton Russia & East European Fund, Inc. 341,971,870 844
Franklin Mutual Advisers, LLC. FRANKLIN MUTUAL SERIES FUND (6)
Franklin Mutual Advisers, LLC. 474 435 Mutual Shares Fund 20,891,236,271 48,753
Franklin Mutual Advisers, LLC. 475 434 Mutual Qualified Fund 5,586,257,932 13,036
Franklin Mutual Advisers, LLC. 476 431 Mutual Beacon Fund 6,304,876,500 14,713
Franklin Mutual Advisers, LLC. 477 432 Mutual Discovery Fund 15,621,926,779 36,456
Franklin Mutual Advisers, LLC. 478 433 Mutual European Fund 2,506,220,594 5,849
479 666 Mutual Financial Services Fund 667,335,651 1,557
-----------------------------------------
TOTAL: $ 360,931,184,669 $ 851,025
=========================================
FRANKLIN TEMPLETON SEC REGISTERED FUNDS IN THE USA
FIDELITY BOND LIMIT SCHEDULE
BASED ON 6/30/2008 NET ASSET VALUES
Minimum Bond
Amount Req'd
by Rule 17g-1
ADVISOR FUND TIS NAME OF FUND NAV (Per Series)
---------------------------------------------------------------------------------------------------------------------------------
Franklin Advisors, Inc. 21 4021 Franklin Floating Rate Master Series $ 464,263,262 $750,000
Franklin Advisors, Inc. 132 4301 Franklin Gold & Precious Metals Fund 2,039,465,007 1,700,000
Franklin Advisors, Inc. 134 4303 Franklin Capital Growth Fund 1,335,840,171 1,250,000
FRANKLIN HIGH INCOME TRUST (1)
Franklin Advisors, Inc. 105 4305 Franklin High Income Fund 2,490,963,838 1,700,000
FRANKLIN CUSTODIAN FUNDS (5)
Franklin Investment
Advisory Services 106 4306 Franklin Growth Fund 2,575,300,763 1,900,000
Franklin Advisors, Inc. 107 4307 Franklin Utilities Fund 2,724,790,629 1,900,000
Franklin Advisors, Inc. 108 4308 Franklin DynaTech Fund 549,025,511 900,000
Franklin Advisors, Inc. 109 4309 Franklin Income Fund 56,934,459,838 2,500,000
Franklin Advisors, Inc. 110 4110 Franklin US Government Sec. Fund 6,692,380,342 2,500,000
Franklin Advisors, Inc. 112 4312 Franklin California Tax-Free Income Fund 14,348,090,980 2,500,000
Franklin Advisors, Inc. 115 4315 Franklin New York Tax-Free Income Fund 5,373,667,156 2,500,000
Franklin Advisors, Inc. 116 4316 Franklin Federal Tax-Free Income Fund 8,061,402,894 2,500,000
FRANKLIN TAX-FREE TRUST (24)
Franklin Advisors, Inc. 118 4318 Franklin Massachusetts Insured Tax-Free
Income Fund 547,822,160 900,000
Franklin Advisors, Inc. 119 4319 Franklin Michigan Insured Tax-Free
Income Fund 1,580,226,867 1,500,000
Franklin Advisors, Inc. 120 4320 Franklin Minnesota Insured Tax-Free
Income Fund 676,005,410 900,000
Franklin Advisors, Inc. 121 4321 Franklin Insured Tax-Free Income Fund 2,279,966,403 1,700,000
Franklin Advisors, Inc. 122 4322 Franklin Ohio Insured Tax-Free Income
Fund 1,356,043,139 1,250,000
Franklin Advisors, Inc. 123 4323 Franklin Double Tax-Free Income Fund 583,999,362 900,000
Franklin Advisors, Inc. 126 4726 Franklin Arizona Tax-Free Income Fund 1,075,323,671 1,250,000
Franklin Advisors, Inc. 127 4327 Franklin Colorado Tax-Free Income Fund 546,064,666 900,000
Franklin Advisors, Inc. 128 4328 Franklin Georgia Tax-Free Income Fund 344,886,503 750,000
Franklin Advisors, Inc. 129 4329 Franklin Pennsylvania Tax-Free Income Fund 989,828,891 1,000,000
Franklin Advisors, Inc. 130 4330 Franklin High Yield Tax-Free Income Fund 6,074,263,407 2,500,000
Franklin Advisors, Inc. 154 4354 Franklin Federal Limited Term Tax-Free
Income 62,871,465 400,000
Franklin Advisors, Inc. 160 4360 Franklin Missouri Tax-Free Income Fund 761,146,126 1,000,000
Franklin Advisors, Inc. 161 4361 Franklin Oregon Tax-Free Income Fund 894,393,044 1,000,000
Franklin Advisors, Inc. 163 4363 Franklin Virginia Tax-Free Income Fund 598,527,923 900,000
Franklin Advisors, Inc. 164 4364 Franklin Alabama Tax-Free Income Fund 288,001,482 750,000
Franklin Advisors, Inc. 165 4365 Franklin Florida Tax-Free Income Fund 1,476,623,577 1,250,000
Franklin Advisors, Inc. 166 4366 Franklin Connecticut Tax-Free Income Fund 416,631,593 750,000
Franklin Advisors, Inc. 168 4368 Franklin Louisiana Tax-Free Income Fund 301,066,984 750,000
Franklin Advisors, Inc. 169 4369 Franklin Maryland Tax-Free Income Fund 550,272,302 900,000
Franklin Advisors, Inc. 170 4370 Franklin North Carolina Tax-Free Income Fund 895,031,242 1,000,000
Franklin Advisors, Inc. 171 4371 Franklin New Jersey Tax-Free Income Fund 1,431,888,151 1,250,000
Franklin Advisors, Inc. 172 4172 Franklin Kentucky Tax-Free Income Fund 161,249,746 600,000
Franklin Advisors, Inc. 174 4174 Franklin Federal Intermediate-Term Tax-Free
Income Fund 814,913,667 1,000,000
FRANKLIN CALIFORNIA TAX-FREE TRUST (4)
Franklin Advisors, Inc. 124 4324 Franklin Calif. Insured Tax-Free Income Fund 2,088,969,834 1,700,000
Franklin Advisors, Inc. 125 4325 Franklin Calif. Tax-Exempt Money Fund 713,105,100 900,000
Franklin Advisors, Inc. 152 4152 Franklin Calif. Intermediate-Term Tax-Free
Income Fund 555,016,175 900,000
Franklin Advisors, Inc. 155 4155 Franklin Calif. Limited Term Tax-Free
Income Fund 24,972,548 250,000
FRANKLIN NEW YORK TAX-FREE TRUST (4)
Franklin Advisors, Inc. 131 4331 Franklin New York Tax -Exempt Money Fund 72,292,200 400,000
Franklin Advisors, Inc. 153 4153 Franklin New York Intermediate-Term
Tax-Free Income Fund 335,084,402 750,000
Franklin Advisors, Inc. 156 4156 Franklin New York Limited Tax-Free
Income Fund 23,717,644 250,000
Franklin Advisors, Inc. 181 4181 Franklin New York Insured Tax-Free
Income Fund 571,449,808 900,000
FRANKLIN GLOBAL TRUST (9)
Fiduciary International Inc. 64 5567 Fiduciary Large Capitalization Growth and
Income Fund 78,402,864 450,000
Fiduciary International Inc. 66 5566 Fiduciary Small Capitalization Equity Fund 24,208,638 250,000
Fiduciary International Inc. 67 4469 Franklin Templeton High Income Fund 5,844,394 150,000
Franklin Templeton Institutional,
LLC 429 12517 Franklin International Growth Fund 4,649,146 125,000
Fiduciary International Inc. 664 4470 Franklin Templeton Core Plus Fixed Income Fun 104,749,538 525,000
Fiduciary International Inc. 667 4471 Franklin Templeton Core Fixed Income Fund 17,484,747 225,000
Franklin Advisors, Inc. 681 4643 Franklin Internation Small Cap Growth Fund 24,364,988 250,000
Franklin Templeton Institutional
LLC 495 4496 Franklin Global Real Estate Fund 100,276,120 525,000
Franklin Templeton Investment
Management Limited 699 4493 Franklin Templeton Emerging Mrkt Debt Opp Fd 80,003,735 450,000
FRANKLIN INVESTORS SECURITIES TRUST (9)
Franklin Advisors, Inc. 136 4336 Franklin Limited Maturity U.S. Govt Sec. Fund 244,239,921 600,000
Franklin Advisors, Inc. 137 4337 Franklin Convertible Securities Fund 859,614,569 1,000,000
Franklin Advisors, Inc. 138 4338 Franklin Adjustable U.S. Government Secs Fund 460,984,777 750,000
Franklin Advisors, Inc. 139 4339 Franklin Equity Income Fund 810,675,762 1,000,000
Franklin Advisors, Inc. 401 4991 Franklin Low Duration Total Return Fund 27,070,523 300,000
Franklin Advisors, Inc. 423 4990 Franklin Real Return Fund 243,302,133 600,000
Franklin Advisors, Inc. 424 4586 Franklin Balanced Fund 60,675,996 400,000
Franklin Advisors, Inc. 460 4460 Franklin Total Return Fund 1,399,533,526 1,250,000
Franklin Advisors, Inc. 489 4489 Franklin Floating Rate Daily Access Fund 1,484,208,419 1,250,000
FRANKLIN TEMPLETON VARIABLE INSURANCE
PRODUCTS TRUST (23)
Franklin Advisors, Inc. 714 4834 Franklin Zero-Coupon Fund - 2010 119,551,984 525,000
Templeton Investment Council,
LLC 715 155 Templeton Global Asset Allocation Fund 123,702,221 525,000
Templeton Asset Management Ltd. 717 381 Templeton Developing Markets Securities Fund 1,370,831,295 1,250,000
Templeton Investment Council,
LLC 719 523 Templeton Foreign Securities Fund 3,522,906,530 2,300,000
Franklin Advisors, Inc. 721 4843 Franklin Large Cap Growth Securities Fund 607,558,696 900,000
Franklin Advisors, Inc. 723 4842 Franklin Smal-Mid Cap Growth Sec. Fund 1,163,615,136 125,000
Franklin Advisory Services LLC 728 4411 Franklin Large Cap Value Securities Fund 39,548,172 350,000
Franklin Advisors, Inc. 729 4410 Franklin Flex Cap Growth Securities Fund 264,505,233 750,000
Templeton Global Advisors Limited 739 4840 Templeton Growth Securities Fund 2,952,869,483 1,900,000
Franklin Advisors, Inc. 741 4827 Templeton Global Income Securities Fund 1,096,180,256 1,250,000
Franklin Mutual Advisers, LLC. 743 4846 Mutual Shares Securities Fund 5,198,490,035 2,500,000
Franklin Advisors, Inc. 745 4821 Franklin Money Market Fund 36,870,874 350,000
Franklin Mutual Advisers, LLC. 753 4845 Mutual Discovery Securities Fund 1,735,938,908 1,500,000
Franklin Advisors, Inc. 755 4825 Franklin Global Communications Securities Fun 224,176,351 600,000
Franklin Advisors, Inc. 767 4822 Franklin Growth & Income Securities Fund 489,453,820 750,000
Franklin Advisors, Inc. 769 4829 Franklin Income Securities Fund 7,700,621,124 2,500,000
Franklin Advisors, Inc. 771 4824 Franklin Global Real Estate Fund 693,911,589 900,000
Franklin Advisory Services
LLC 773 4836 Franklin Rising Dividends Securities Fund 1,993,492,375 1,500,000
Franklin Advisory Services
LLC 775 4848 Franklin Small Cap Value Securities Fund 1,147,119,353 1,250,000
Franklin Advisors, Inc. 777 4826 Franklin High Income Securities Fund 189,263,668 600,000
Franklin Advisors, Inc. 779 4884 Franklin Strategic Income Securities Fund 1,160,511,873 1,250,000
Franklin Advisors, Inc. 781 4830 Franklin U.S. Gov't Fund 547,516,713 900,000
Franklin Advisors, Inc. 783 11536 Franklin Templeton VIP Founding Funds
Allocation Fund 391,930,023 750,000
FRANKLIN MUNICIPAL SECURITIES TRUST (2)
Franklin Advisors, Inc. 175 4175 Franklin CA High Yield Municipal Fund 1,553,768,397 1,500,000
Franklin Advisors, Inc. 420 4220 Franklin TN Municipal Bond Fund 199,728,817 600,000
FRANKLIN MANAGED TRUST (1)
Franklin Advisory Services LLC 158 4358 Franklin Rising Dividends Fund 2,221,963,643 1,700,000
FRANKLIN TEMPLETON LIMITED DURATION
INCOME TRUST (1)
Franklin Advisors, Inc. 3637 4472 Franklin Templeton Limited Duration Income
Trust 346,521,005 750,000
FRANKLIN TEMPLETON INTERNATIONAL TRUST (3)
Franklin Advisors, Inc. 141 12054 Franklin India Growth Fund 48,687,746 350,000
Franklin Templeton Investments Co 191 4191 Templeton Foreign Smaller Companies Fund 344,968,294 750,000
Franklin Advisors, Inc. 467 2800 Templeton Global Long - Short Fund 244,013,204 600,000
FRANKLIN STRATEGIC SERIES (11)
Franklin Advisors, Inc. 180 4180 Franklin Flex Cap Growth Fund 2,811,242,855 1,900,000
Franklin Advisors, Inc. 194 4194 Franklin Strategic Income Fund 3,235,343,824 2,100,000
Franklin Advisors, Inc. 197 4197 Franklin Global Communications Fund 102,637,256 525,000
Franklin Advisors, Inc. 198 4198 Franklin Small-Mid Cap Growth Fund 5,483,913,708 2,500,000
Franklin Advisors, Inc. 199 4199 Franklin Global Healthcare Fund 137,247,365 525,000
Franklin Advisors, Inc. 402 4402 Franklin Biotechnology Discovery Fund 333,618,975 750,000
Franklin Advisors, Inc. 403 4403 Franklin Natural Resources Fund 1,090,243,069 1,250,000
Franklin Advisors, Inc. 443 12053 Franklin Focused Core Equity Fund 4,858,747 125,000
Franklin Advisors, Inc. 462 4462 Franklin Growth Opportunities Fund 308,768,018 750,000
Franklin Advisors, Inc. 463 4463 Franklin Technology Fund 56,879,169 400,000
Franklin Advisors, Inc. 465 4465 Franklin Small Cap Growth Fund II 579,166,977 900,000
FRANKLIN VALUE INVESTORS TRUST (6)
Franklin Advisory Services
LLC 150 4150 Franklin Balance Sheet Investment Fund 3,560,070,726 2,300,000
Franklin Advisory Services
LLC 189 4189 Franklin MicroCap Value Fund 378,147,608 750,000
Franklin Advisory Services
LLC 422 4297 Franklin MidCapValue Fund 76,581,471 450,000
Franklin Advisory Services
LLC 448 11579 Franklin All Cap Value Fund 12,860,269 200,000
Franklin Advisory Services
LLC 480 4480 Franklin Large Cap Value Fund 175,687,819 600,000
Franklin Advisory Services
LLC 482 4282 Franklin Small Cap Value Fund 1,202,756,767 1,250,000
Franklin Advisors, Inc. 2 4002 Franklin Universal Trust 182,995,544 600,000
Franklin Advisors, Inc. 111 4311 Franklin Money Fund 2,489,448,004 1,700,000
Franklin Advisors, Inc. 114 4314 Franklin Tax-Exempt Money Fund 167,779,027 600,000
Franklin Advisors, Inc. 157 4157 Franklin Strategic Mortgage Portfolio 191,326,605 600,000
Franklin Advisors, Inc. 192 4192 Franklin Real Estate Securities Trust 407,638,442 750,000
FRANKLIN TEMPLETON MONEY FUND TRUST (1)
Franklin Advisors, Inc. 311 4511 Franklin Templeton Money Fund 292,348,784 750,000
INSTITUTIONAL FIDUCIARY TRUST (2)
Franklin Advisors, Inc. 140 4340 Money Market Portfolio 4,078,167,317 2,500,000
Franklin Advisors, Inc. 149 4149 Franklin Cash Reserves Fund 150,098,847 600,000
FRANKLIN TEMPLETON FUND ALLOCATOR SERIES
(10) (FTFAS)
Franklin Advisors, Inc. 185 723 Franklin Templeton Perspectives Allocation Fund 276,687,640 750,000
Franklin Advisors, Inc. 427 4389 FTFAS-Franklin Templeton 2015 Retirement
Target Fund 16,757,642 225,000
Franklin Advisors, Inc. 445 4390 FTFAS-Franklin Templeton 2025 Retirement
Target Fund 13,728,131 200,000
Franklin Advisors, Inc. 446 4391 FTFAS-Franklin Templeton 2035 Retirement
Target Fund 7,742,898 175,000
Franklin Advisors, Inc. 451 4392 FTFAS-Franklin Templeton 2045 Retirement
Target Fund 4,563,295 125,000
Franklin Advisors, Inc. 470 4467 Franklin Templeton Corefolio Allocation Fund 633,744,096 900,000
Franklin Advisors, Inc. 481 4468 Franklin Templeton Founding Funds Allocation
Fund 13,363,886,554 2,500,000
Franklin Advisors, Inc. 484 4484 Franklin Templeton Conservative Target Fund 457,240,665 750,000
Franklin Advisors, Inc. 485 4485 Franklin Templeton Moderate Target Fund 728,491,483 900,000
486 4486 Franklin Templeton Growth Target Fund 544,837,522 900,000
THE MONEY MARKET PORFOLIOS (1) (TMMP)
Franklin Advisors, Inc. 184 4184 Money Market Portfolio 7,013,568,325 2,500,000
FRANKLIN TEMPLETON GLOBAL TRUST (1)
Franklin Advisors, Inc. 412 4212 Franklin Templeton Hard Currency Fund 691,359,987 900,000
Franklin Mutual Advisers, LLC. 471 4447 Franklin Mutual Recovery Fund 375,985,938 750,000
Templeton Global Advisors Limited 101 105 Templeton Growth Fund, Inc. 28,919,932,032 2,500,000
Franklin Templeton Investments
Corp. 103 30 Templeton Global Smaller Companies Fund 1,190,628,834 1,500,000
TEMPLETON FUNDS (2)
Templeton Global Advisors Limited 102 31 Templeton World Fund 8,163,722,626 2,500,000
Templeton Global Advisors Limited 104 37 Templeton Foreign Fund 10,003,707,914 2,500,000
Templeton Investment Counsel, LLC 415 201 Templeton Global Opportunities Trust 1,081,859,485 1,250,000
TEMPLETON INCOME TRUST (2)
Franklin Advisors, Inc. 406 97 Templeton Global Bond Fund 10,625,609,804 2,500,000
Franklin Advisors, Inc. 447 12052 Templeton International Bond Fund 15,128,388 225,000
TEMPLETON GLOBAL INVESTMENT TRUST (3)
Templeton Asset Management Ltd. 405 4494 Templeton BRIC Fund 941,134,567 1,000,000
Templeton Global Advisors Limited 425 4290 Templeton Income Fund 1,013,237,383 1,250,000
Templeton Asset Management Ltd. 426 4398 Templeton Emerging Markets Small Cap Fund 96,106,002 450,000
Templeton Investment Counsel, LLC TEMPLETON INSTITUTIONAL FUNDS (4)
Templeton Investment Council, LLC 442 12332 Global Equity Series 118,286,005 525,000
Templeton Investment Council, LLC 454 243 Foreign Equity Series 7,448,793,181 2,500,000
Templeton Asset Management Ltd. 456 540 Emerging Markets Series Fund 2,600,292,992 1,900,000
Franklin Advisors, Inc. 458 4562 Foreign Smaller Companies Series 122,533,933 525,000
Franklin Advisors, Inc. 946 146 Templeton Global Income Fund 1,146,189,931 1,250,000
Franklin Advisors, Inc. 555 555 Templeton Emerging Markets Income Fund 670,023,676 900,000
Templeton Asset Management Ltd. 581 581 Templeton Dragon Fund, Inc. 1,088,812,969 1,250,000
Templeton Asset Management Ltd. 911 111 Templeton Emerging Markets Fund 392,295,556 750,000
Templeton Asset Management Ltd. 711 505 Templeton Developing Markets Trust 4,354,422,366 2,500,000
Templeton Asset Management Ltd. 188 4473 Templeton China World Fund 938,407,568 1,000,000
Templeton Asset Management Ltd. 337 337 Templeton Russia & East European Fund, Inc. 341,971,870 750,000
Franklin Mutual Advisers, LLC. FRANKLIN MUTUAL SERIES FUND (6)
Franklin Mutual Advisers, LLC. 474 435 Mutual Shares Fund 20,891,236,271 2,500,000
Franklin Mutual Advisers, LLC. 475 434 Mutual Qualified Fund 5,586,257,932 2,500,000
Franklin Mutual Advisers, LLC. 476 431 Mutual Beacon Fund 6,304,876,500 2,500,000
Franklin Mutual Advisers, LLC. 477 432 Mutual Discovery Fund 15,621,926,779 2,500,000
Franklin Mutual Advisers, LLC. 478 433 Mutual European Fund 2,506,220,594 1,900,000
479 666 Mutual Financial Services Fund 667,335,651 900,000
--------------------------------
TOTAL: $ 360,931,184,669 $ 174,600,000
================================
AMENDED AND RESTATED ALLOCATION AGREEMENT
This Amended and Restated Allocation Agreement ("Agreement")
is made as of the 12th day of November 2008, by and among
the funds listed on Schedule A of this Agreement (hereafter
collectively referred to as the "Funds") and the non-funds
described on Schedule B of this Agreement (hereafter
collectively referred to as the "Non-Funds"). The Funds
and Non-Funds are hereafter collectively referred to as the
"Insured."
This Agreement is entered into under the following
circumstances:
A. Section 17(g) of the Investment Company Act of 1940
(the "Act") provides that the Securities and Exchange
Commission ("SEC") is authorized to require that the
officers and employees of registered management
investment companies be bonded against larceny and
embezzlement, and the SEC has promulgated rules and
regulations dealing with this subject ("Rule 17g-1");
B. The Funds and the Non-Funds are named as joint insureds
under the terms of certain bonds or policies of
insurance which insure against larceny and embezzlement
of officers and employees (the "Fidelity Bonds");
C. A majority of those members of the Board of
Directors/Trustees of each of the Funds, who are not
"interested persons" as defined by Section 2(a)(19) of
the Act, have given due consideration to all factors
relevant to the form, amount and apportionment of
premiums and recoveries on the Fidelity Bonds and each
such Board of Directors/Trustees of each Fund has
approved the term and amount of the Fidelity Bonds, the
portion of the premiums payable by that party, and the
manner in which recovery of said Fidelity Bonds, if
any, shall be shared by and among the parties hereto as
hereinafter set forth; and
D. The Insureds now desire to enter into the agreement
required by Rule 17g-1(f) to establish the manner in
which payment of premiums and recovery on said Fidelity
Bonds, if any, shall be shared.
NOW, THEREFORE, IT IS HEREBY AGREED by and among the parties
hereto as follows:
1. PAYMENT OF PREMIUMS
The premium shall be allocated between the Insured in
accordance with the requirements of Rule 17g-1(e). The
portion of the premium which is allocated to the Funds shall
be divided among the Funds as follows: each Fund shall pay
that percentage of each premium when due under the Fidelity
Bonds which is derived by a fraction, (i) the denominator of
which is the total assets of all of the Funds combined at
the time any premium is due; and (ii) the numerator of which
is the total assets of each of the Funds individually at the
time any premium is due.
2. ALLOCATION OF RECOVERIES
(a) If more than one of the parties hereto is damaged
in a single loss for which recovery is received
under the Fidelity Bonds, each such party shall
receive that portion of the recovery which
represents the loss sustained by that party,
unless the recovery is inadequate fully to
indemnify each such party sustaining a loss.
(b) If the recovery is inadequate fully to indemnify
each such party hereto sustaining a loss, the
recovery shall be allocated among such parties in
the following order:
(i) Each Insured sustaining a loss shall be allocated
an amount equal to the lesser of its actual loss
or an amount in the proportion that each such
Insured's last payment of premium bears to
the sum of the last such premium payments of
all such Insureds, except that if this
allocation would result in any Fund,
including those Fund(s) created during the
policy term that have paid no premium as
provided for in paragraph 4 of this
Agreement, receiving less than the minimum
amount of recovery under the Fidelity Bonds
which would be required to be maintained by
such party under a single insured fidelity
bond in accordance with the provision of Rule
17g-1(d)(1) (determined as of the time of the
loss) (the "Single Insured Minimum"), then
first from the share allocated to the
non-Funds, sufficient monies shall be
re-allocated to the Funds to bring the share
of each Fund up to the Single Insured Minimum
(determined as of the time of the loss).
The basis of each reallocation from each of
the non-Funds sustaining a loss to Funds
sustaining a loss shall be the proportion
that each such non-Fund's last payment of
premium bears to the sum of the last such
premium payments of all such non-Funds.
To the extent this reallocation from
non-Funds to Funds is still insufficient to
bring the share of each Fund sustaining a
loss up to the Single Insured Minimum
(determined as of the time of the loss), then
second, from the share allocated to Funds
sustaining a loss whose allocation exceeds
the Single Insured Minimum amount for the
Fund, sufficient monies will be reallocated,
to the extent possible, to the other Funds
sustaining a loss to bring the share of each
Fund sustaining a loss up to the Single
Insured Minimum (determined as of the time of
loss).
The basis of such reallocation from Funds
sustaining a loss to other Funds sustaining a
loss shall be the proportion that each such
Fund's last payment of premium bears to the
last such premium payments of all such Funds.
(ii) The remaining portion of the proceeds shall be
allocated to each party sustaining a loss not
fully covered by the allocation under
subparagraph (i) in the proportion that each
such party's last payment of premium bears to
the sum of the last such premium payment of
all such parties. If such allocation would
result in any party sustaining a loss
receiving a portion of the recovery in excess
of the loss actually sustained by such party,
the aggregate of each excess portion shall be
allocated among the other parties whose
losses would not be fully indemnified in the
same proportion that each such party's last
payment of premium bears to the sum of the
last such premium payments of all parties
entitled to receive a share of the excess.
Any allocation in excess of a loss actually
sustained by any such party shall be
reallocated in the same manner.
3. OBLIGATION TO MAINTAIN MINIMUM COVERAGE
Each of the Funds represents and warrants to each of the
other parties hereto that it has determined the amount of
its Single Insured Minimum as of the date hereof and that
such Single Insured Minimum is included in the coverage of
the Fidelity Bonds. Each of the Funds agrees that it will
determine, no less often than at the end of each calendar
quarter, the Single Insured Minimum which would be required
of it if a determination with respect to the adequacy of the
coverage were then currently being made. In the event that
the total amount of the minimum coverages thus determined
exceeds the total amount of coverage of then effective
Fidelity Bonds, management of each of the Funds will be
notified and will determine whether it is necessary or
appropriate to increase the total amount of coverage of the
Fidelity Bonds to an amount not less than the total amount
of such minimums, or to secure such excess coverage for one
or more of the parties hereto, which, when added to the
total coverage of the Fidelity Bonds, will equal an amount
not less than the total amount of such minimums. Each Fund
agrees to pay its fair (taking into account all of the then
existing circumstances) portion of the new or additional
premium; provided that in the event that a Fund elects to
terminate this Agreement (as to itself as a party hereto
pursuant to paragraph 5) and its participation in the
joint-insured Fidelity Bonds on or prior to the effective
date of the new or additional premium, such party shall not
pay any portion of the new or additional premium.
4. NEWLY CREATED FUNDS OR NON-FUNDS
The parties hereto agree that during the policy term any
newly created Fund(s) or non-Fund(s) can be added as joint
Insured on the Fidelity Bonds and can be added as parties to
this Agreement, as then currently amended or restated, in
the case of this Agreement, by attaching a revised Schedule
A and/or Schedule B, as applicable, to this Agreement that
reflects the addition of such newly created Fund(s) or
non-Fund(s); provided that such revised Schedule A and/or
Schedule B is signed by the proper officers of the Insured
that are authorized to execute this Agreement and is dated
with the as of date upon which such addition(s) is
effective. The newly created Fund(s) or non-Fund(s) that
are added as joint Insured on the Fidelity Bonds and to this
Agreement, as then currently amended or restated, will not
be required to pay any premium during the then current
policy term of the Fidelity Bonds, unless, pursuant to
paragraph 3 of this Agreement, an increase in the total
amount of coverage is required. Each of such newly created
Fund(s) or non-Fund(s) that are added as joint Insured
agrees to pay its proportionate share of any new or
additional premium, as outlined in paragraph 3 to this
Agreement, and to be bound by all other terms and conditions
of this Agreement.
5. SUCCESSORS
This Agreement shall apply to the present Fidelity Bond
coverage and any renewal or replacement thereof and shall
continue until terminated as to any party by such party
hereto giving not less than sixty days' notice to the other
parties hereto in writing. This Agreement shall be binding
upon, and inure to the benefit of, the parties hereto and
any successor or successors to a party hereto resulting from
a change in domicile or form of corporate, trust or similar
organization of such party.
6. AUTHORIZATION TO EXECUTE; COUNTERPARTS
The parties hereby agree that the proper officers of the
Insured are authorized to execute this Agreement, and any
amendments thereto, on behalf of the parties to this
Agreement. This Agreement may be executed in two or more
counterparts, all of which taken together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first written above.
THE FUNDS LISTED ON SCHEDULE A OF THIS AGREEMENT, AND
THE NON-FUNDS DESCRIBED ON SCHEDULE B OF THIS AGREEMENT
By: /s/ CRAIG S. TYLE
Name: Craig S. Tyle
SCHEDULE A
FUNDS
Franklin California Tax-Free Income Fund
Franklin California Tax-Free Trust
Franklin Capital Growth Fund
Franklin Custodian Funds
Franklin Federal Tax-Free Income Fund
Franklin Floating Rate Master Trust
Franklin Global Trust
Franklin Gold and Precious Metals Fund
Franklin High Income Trust
Franklin Investors Securities Trust
Franklin Managed Trust
Franklin Money Fund
Franklin Municipal Securities Trust
Franklin Mutual Recovery Fund
Franklin Mutual Series Funds.
Franklin New York Tax-Free Income Fund
Franklin New York Tax-Free Trust
Franklin Real Estate Securities Trust
Franklin Strategic Mortgage Portfolio
Franklin Strategic Series
Franklin Tax-Free Trust
Franklin Tax-Exempt Money Fund
Franklin Templeton Fund Allocator Series
Franklin Templeton Global Trust
Franklin Templeton International Trust
Franklin Templeton Limited Duration Income Trust
Franklin Templeton Money Fund Trust
Franklin Templeton Variable Insurance Products Trust
Franklin Universal Trust
Franklin Value Investors Trust
Institutional Fiduciary Trust
The Money Market Portfolios
Templeton Growth Fund, Inc.
Templeton Funds
Templeton Global Smaller Companies Fund
Templeton Income Trust
Templeton Developing Markets Trust
Templeton Global Opportunities Trust
Templeton Institutional Funds
Templeton Global Investment Trust
Templeton China World Fund
Templeton Emerging Markets Fund
Templeton Global Income Fund
Templeton Emerging Markets Income Fund
Templeton Dragon Fund, Inc.
Templeton Russia and East European Fund, Inc.
SCHEDULE B
NON-FUNDS
Franklin Resources, Inc. and its subsidiaries.