FORM
FUND ADMINISTRATION AGREEMENT
AGREEMENT dated as of _____________ between FRANKLIN
FLOATING RATE MASTER TRUST (the "Investment Company"), an investment
company registered under the Investment Company Act of 1940 ("1940
Act"), on behalf of FRANKLIN FLOATING RATE MASTER SERIES (the "Fund"),
and Franklin Xxxxxxxxx Services, Inc. ("Administrator").
In consideration of the mutual agreements herein made, the
parties hereby agree as follows:
(1) The Administrator agrees, during the life of this
Agreement, to provide the following services to the Fund:
(a) providing office space, telephone, office equipment
and supplies for the Fund;
(b) providing trading desk facilities for the Fund, unless
these facilities are provided by the Fund's investment adviser;
(c) authorizing expenditures and approving bills for
payment on behalf of the Fund;
(d) supervising preparation of periodic reports to Fund
shareholders, notices of dividends, capital gains distributions and
tax credits; and attending to routine correspondence and other
communications with individual Fund shareholders when asked to do so
by the Fund's shareholder servicing agent or other agents of the Fund;
(e) coordinating the daily pricing of the Fund's
investment portfolio, including collecting quotations from pricing
services engaged by the Fund; providing fund accounting services,
including preparing and supervising publication of daily net asset
value quotations, periodic earnings reports and other financial data;
(f) monitoring relationships with organizations serving
the Fund, including custodians, transfer agents, public accounting
firms, law firms, printers and other third party service providers;
(g) supervising compliance by the Fund with recordkeeping
requirements under the federal securities laws, including the 1940
Act, and the rules and regulations thereunder, supervising compliance
with recordkeeping requirements imposed by state laws or regulations,
and maintaining books and records for the Fund (other than those
maintained by the custodian and transfer agent);
(h) preparing and filing of tax reports including the
Fund's income tax returns, and monitoring the Fund's compliance with
subchapter M of the Internal Revenue Code, and other applicable tax
laws and regulations;
(i) monitoring the Fund's compliance with: 1940 Act and
other federal securities laws, and rules and regulations thereunder;
state and foreign laws and regulations applicable to the operation of
investment companies; the Fund's investment objectives, policies and
restrictions; and the Code of Ethics and other policies adopted by
the Investment Company's Board of Trustees ("Board") or by the
Adviser and applicable to the Fund;
(j) providing executive, clerical and secretarial
personnel needed to carry out the above responsibilities; and
(k) preparing regulatory reports, including without
limitation, NSARs, proxy statements, and U.S. and foreign ownership
reports.
Nothing in this Agreement shall obligate the Investment Company or
the Fund to pay any compensation to the officers of the Investment
Company. Nothing in this Agreement shall obligate the Administrator
to pay for the services of third parties, including attorneys,
auditors, printers, pricing services or others, engaged directly by
the Fund to perform services on behalf of the Fund.
(2) The Fund agrees to pay to the Administrator as compensation
for such services a monthly fee equal on an annual basis to 0.15% of the fund's
average daily net assets up to $200 million, 0.135% of average daily net assets
over $200 million up to $700 million, 0.10% of average daily net assets over
$700 million up to $1.2 billion, and 0.075% of average daily net assets over
$1.2 billion.
From time to time, the Administrator may waive all or a portion of
its fees provided for hereunder and such waiver shall be treated as a
reduction in the purchase price of its services. The Administrator
shall be contractually bound hereunder by the terms of any publicly
announced waiver of its fee, or any limitation of the affected Fund's
expenses, as if such waiver or limitation were fully set forth herein.
(3) This Agreement shall remain in full force and effect
through for one year after its execution and thereafter from year to
year to the extent continuance is approved annually by the Board of
the Investment Company.
(4) This Agreement may be terminated by the Investment Company
at any time on sixty (60) days' written notice without payment of
penalty, provided that such termination by the Investment Company
shall be directed or approved by the vote of a majority of the Board
of the Investment Company in office at the time or by the vote of a
majority of the outstanding voting securities of the Investment
Company (as defined by the 1940 Act); and shall automatically and
immediately terminate in the event of its assignment (as defined by
the 1940 Act).
(5) In the absence of willful misfeasance, bad faith or gross
negligence on the part of the Administrator, or of reckless disregard
of its duties and obligations hereunder, the Administrator shall not
be subject to liability for any act or omission in the course of, or
connected with, rendering services hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers.
FRANKLIN FLOATING RATE MASTER TRUST on behalf of
FRANKLIN FLOATING RATE MASTER SERIES
By:
Title: ________________________
FRANKLIN XXXXXXXXX SERVICES, INC.
By: ___________________________
Title: ________________________
