UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 8, 2004
FRANKLIN RESOURCES, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-9318 13-2670991
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
One Franklin Parkway, San Mateo, California 94403
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (650) 312-3000
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(Former name or former address, if changed since last report): Not Applicable
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (See General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
RESTRICTED STOCK AWARDS
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On November 8, 2004, the Compensation Committee of the Board of Directors (the
"Compensation Committee") of Franklin Resources, Inc. (the "Company") approved
restricted stock awards ("RSA") granting common stock ("Stock") of the Company
under the Company's 2002 Universal Stock Incentive Plan (the "2002 USIP") to
certain of the Company's executive officers. Each of the following executive
officers of the Company received the following number of shares of Stock: Anne
M. Tatlock, Vice Chairman: 6,272 shares; Murray L. Simpson, Executive Vice
President and General Counsel: 3,920 shares; James R. Baio, Senior Vice
President and Chief Financial Officer: 3,607 shares; Jennifer J. Bolt, Senior
Vice President and Chief Information Officer: 3,763 shares; Leslie M. Kratter,
Senior Vice President and Assistant Secretary: 2,979 shares; Penelope S.
Alexander, Vice President, Human Resources - U.S.: 1,380 shares; Holly E.
Gibson, Vice President, Corporate Communications: 784 shares; Barbara J. Green,
Vice President, Deputy General Counsel and Secretary: 1,317 shares; Kenneth A.
Lewis, Vice President and Treasurer: 1,412 shares; Charles R. Sims, Vice
President: 2,352 shares; John M. Lusk, Vice President: 2,352 shares.
The Company has entered into a Restricted Stock Award Agreement (the "RSA
Agreement") with each of the executive officers listed above. Each RSA awarded
to such executive officers of the Company has an effective grant date of
November 8, 2004, and is subject to annual vesting in equal installments over a
three-year period and will vest one-third on September 30, 2005, one-third on
September 29, 2006 and one-third on September 28, 2007, subject to accelerated
vesting or forfeiture under certain events described in the RSA Agreement.
A copy of the 2002 USIP was filed as Exhibit 10.68 to the Company's Report on
Form 10-Q for the quarterly period ended December 31, 2002. A copy of the form
of the RSA Agreement and Notice of Restricted Stock Award ("Notice of Award")
under the 2002 USIP is filed herewith as Exhibit 10.74. Each of the foregoing is
incorporated herein by reference.
The following is a summary of the principal terms of the RSA Agreement and
Notice of Award, which are qualified in their entirety by reference to Exhibit
10.74:
RESTRICTED STOCK AWARD. The Company issues to participants, including the
executive officers (the "Participant") shares of Stock as set forth in the
Notice of Award, subject to the rights of and limitations on Participant as
owner as set forth in the RSA Agreement. All shares of Stock issued are deemed
to be issued to Participant as fully paid and non assessable shares, and
Participant has all rights of a shareholder, including the right to vote, to
receive dividends (including stock dividends), to participate in stock splits or
other recapitalizations, and to exchange such shares in a merger, consolidation
or other reorganization.
TRANSFER RESTRICTION. No Stock issued to Participant may be sold, transferred by
gift, pledged, hypothecated, or otherwise transferred or disposed of by
Participant prior to the date on which it becomes vested. Participant is not
precluded from exchanging the Stock awarded pursuant to a cash or stock tender
offer, merger, reorganization or consolidation. Any securities (including stock
dividends and stock splits) received with respect to shares of Stock which are
not yet vested are subject to the RSA Agreement in the same manner and become
fully vested at the same time as the Stock with respect to which such additional
securities were issued.
VESTING. Participant's interest in the Stock awarded becomes vested and
nonforfeitable in accordance with the Vesting Schedule in the Notice of Award so
long as Participant maintains continuous status as an employee of the Company or
a Subsidiary. If Participant ceases to maintain continuous status as an employee
of the Company or any of its subsidiaries for any reason other than death or
disability, all shares of Stock to the extent not yet vested on the date
Participant ceases to be a full-time employee are forfeited by Participant.
If Participant dies or in the event of termination of Participant's continuous
status as an employee as a result of disability while a full-time employee of
the Company or any of its subsidiaries, Participant's interest in all shares of
Stock awarded become fully vested and nonforfeitable as of the date of death or
termination of employment on account of such disability. Unless changed by the
Board, "disability" means that the Participant ceases to be an employee on
account of permanent and total disability as a result of which the Participant
shall be eligible for payments under the Company's long term disability policy.
STOCK OPTION GRANT
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On November 8, 2004, the Compensation Committee also approved a stock option
grant to purchase 1,506 shares of Stock under the 2002 USIP to Donna S. Ikeda,
Vice President, Human Resources - International. Ms. Ikeda is an executive
officer of the Company.
The Company has entered into a Stock Option Agreement (the "Option Agreement")
with Ms. Ikeda. Each option granted to Ms. Ikeda has an effective grant date of
November 8, 2004, and is subject to annual vesting in equal installments over a
three-year period and will vest one-third on September 30, 2005, one-third on
September 29, 2006 and one-third on September 28, 2007, subject to accelerated
vesting or forfeiture under certain events described in the Option Agreement.
The option may be exercised only until September 30, 2009, the expiration date.
The exercise price of the shares is $55.81 per share.
A copy of the form of the Stock Option Agreement and Notice of Grant are filed
herewith as Exhibit 10.75. Each of the foregoing is incorporated herein by
reference.
The following is a summary of the principal terms of the Option Agreement and
Notice of Stock Option Grant, which are qualified in their entirety by reference
to Exhibit 10.75:
GRANT OF OPTION. The Company grants to the optionees ("Optionee"), including
executive officers, named in a notice of grant (the "Notice of Grant"), an
option (the "Option") to purchase a number of shares (the "Shares"), as set
forth in the Notice of Grant, at the exercise price per share set forth in the
Notice of Grant (the "Exercise Price"), subject to the terms, conditions and
definitions 2002 USIP, adopted by the Company.
EXERCISE OF OPTION.
Right to Exercise. The Option is exercisable during its term in accordance with
the exercise schedule set out in the Notice of Grant and the applicable
provisions of the 2002 USIP and the Option Agreement.
Method of Payment. Payment of the aggregate Exercise Price may be made in cash
or Shares, valued at fair market value on the date of exercise.
TERMINATION OF EMPLOYMENT. In the event of termination of Optionee's continuous
status as an employee, Optionee may, to the extent otherwise so entitled at the
date of such termination (the "Termination Date"), exercise the Option for a
period of ninety (90) days after the Termination Date (but in no event later
than
the expiration date of the Option). To the extent that Optionee was not entitled
to exercise the Option at the Termination Date, or if Optionee does not exercise
the Option within the time specified herein, the Option shall terminate.
DISABILITY OF OPTIONEE. In the event of termination of Optionee's continuous
status as an employee as a result of disability, Optionee may, but only within
six (6) months from the Termination Date (but in no event later than the
expiration date of the Option), exercise the Option in full, even if the right
to exercise shall not have otherwise accrued at the date of such total and
permanent disability. All rights to exercise the Option shall expire and be of
no further force or effect after such six month period. Unless changed by the
Compensation Committee, "disability" means that the Optionee ceases to be an
employee on account of permanent and total disability as a result of which the
Optionee shall be eligible for payments under the Company's long term disability
policy applicable to the Optionee. To the extent that Optionee was not entitled
to exercise the Option at the Termination Date, or if Optionee does not exercise
such Option (to the extent otherwise so entitled) within the time specified
herein, the Option shall terminate.
DEATH OF OPTIONEE. In the event of the death of Optionee, the Option may be
exercised in full at any time within six (6) months following the date of death
(but in no event later than expiration date of the Option), by Optionee's estate
or by a person who acquired the right to exercise the Option by bequest or
inheritance, even if the right to exercise shall not have otherwise accrued at
the date of death. All rights to exercise the Option shall expire and be of no
further force or effect after such six month period.
TERM OF OPTION. The Option may be exercised only until the expiration date set
out in the Notice of Grant, and may be exercised during such term only in
accordance with the 2002 USIP and the terms of the Option Agreement.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits:
EXHIBIT NO. DESCRIPTION
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10.74 Form of Restricted Stock Award Agreement and Notice
of Restricted Stock Award under the Company's 2002
Universal Stock Incentive Plan
10.75 Form of Stock Option Agreement and Notice of Stock
Option Grant under the Company's 2002 Universal
Stock Incentive Plan
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FRANKLIN RESOURCES, INC.
(Registrant)
Date: November 12, 2004 /s/ Barbara J. Green
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Barbara J. Green
Vice President, Deputy General Counsel
and Secretary
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
10.74 Form of Restricted Stock Award Agreement and Notice
of Restricted Stock Award under the Company's 2002
Universal Stock Incentive Plan
10.75 Form of Stock Option Agreement and Notice of Stock
Option Grant under the Company's 2002 Universal
Stock Incentive Plan