CERTIFICATE OF AMENDMENT
OF
AGREEMENT AND DECLARATION OF TRUST
OF
FRANKLIN CUSTODIAN FUNDS
The undersigned Trustees of Franklin Custodian Funds, a
Delaware statutory trust (the "Trust"), constituting a majority
of the Board of Trustees of the Trust (the "Trustees"), do hereby
certify that pursuant to the authority granted to the Trustees in
Article IX, Section 1 of the Agreement and Declaration of Trust
of the Trust made as of October 18, 2006, as amended December 4,
2006, (the "Declaration of Trust"), the Declaration of Trust is
hereby amended as follows:
FIRST. ARTICLE IV, Section 3(a) of the Declaration of
Trust is hereby amended by adding the following language at the
end thereof:
The Trustees shall be subject to the same fiduciary duties
to which the directors of a Delaware corporation would be subject
if the Trust were a Delaware corporation, the Shareholders were
shareholders of such Delaware corporation and the Trustees were
directors of such Delaware corporation, and such modified duties
shall replace any fiduciary duties to which the Trustees would
otherwise be subject. Without limiting the generality of the
foregoing, all actions and omissions of the Trustees shall be
evaluated under the doctrine commonly referred to as the
"business judgment rule," as defined and developed under Delaware
law, to the same extent that the same actions or omissions of
directors of a Delaware corporation in an substantially similar
circumstance would be evaluated under such doctrine.
Notwithstanding the foregoing, the provisions of this Declaration
of Trust and the By-Laws, to the extent that they restrict or
eliminate the duties (including fiduciary duties) and liabilities
relating thereto of a Trustee otherwise applicable under the
foregoing standard or otherwise existing at law or in equity, are
agreed by each Shareholder and the Trust to replace such other
duties and liabilities of such Trustee.
SECOND. ARTICLE VII, Section 4 of the Declaration of
Trust is hereby amended by deleting such provision in its
entirety and replacing it with the following:
Section 4.DERIVATIVE ACTIONS. In addition to the
requirements set forth in Section 3816 of the DSTA, a Shareholder
or Shareholders may bring a derivative action on behalf of the
Trust only if the following conditions are met:
(a) The Shareholder or Shareholders must make a pre-suit
demand upon the Board of Trustees to bring the subject action
unless an effort to cause the Board of Trustees to bring such an
action is not likely to succeed. For purposes of this Section 4,
a demand on the Board of Trustees shall only be deemed not likely
to succeed and therefore excused if a majority of the Board of
Trustees, or a majority of any committee established to consider
the merits of such action, is composed of Trustees who are not
"independent trustees" (as such term is defined in the DSTA).
(b) Unless a demand is not required under paragraph (a) of
this Section 4, Shareholders eligible to bring such derivative
action under the DSTA who hold at least 10% of the outstanding
Shares of the Trust, or 10% of the outstanding Shares of the
Series or Class to which such action relates, shall join in the
request for the Board of Trustees to commence such action; and
(c) Unless a demand is not required under paragraph (a) of
this Section 4, the Board of Trustees must be afforded a
reasonable amount of time to consider such Shareholder request
and to investigate the basis of such claim. The Board of
Trustees shall be entitled to retain counsel or other advisors in
considering the merits of the request and shall require an
undertaking by the Shareholders making such request to reimburse
the Trust for the expense of any such advisors in the event that
the Board of Trustees determine not to bring such action.
For purposes of this Section 4, the Board of Trustees may
designate a committee of one Trustee to consider a Shareholder
demand if necessary to create a committee with a majority of
Trustees who are "independent trustees" (as such term in defined
in the DSTA).
THIRD. ARTICLE X, Section 2 of the Declaration of Trust
is hereby amended by deleting such provision in its entirety and
replacing it with the following:
Section 2.APPLICABLE LAW. This Declaration of Trust is
created under and is to be governed by and construed and
administered according to the laws of the State of Delaware and
the applicable provisions of the 1940 Act and the Code; provided,
that, all matters relating to or in connection with the conduct
of Shareholders' and Trustees' meetings (excluding, however, the
Shareholders' right to vote), including, without limitation,
matters relating to or in connection with record dates, notices
to Shareholders or Trustees, nominations and elections of
Trustees, voting by, and the validity of, Shareholder proxies,
quorum requirements, meeting adjournments, meeting postponements
and inspectors, which are not specifically addressed in this
Declaration of Trust, in the By-Laws or in the DSTA (other than
DSTA Section 3809), or as to which an ambiguity exists, shall be
governed by the Delaware General Corporation Law, and judicial
interpretations thereunder, as if the Trust were a Delaware
corporation, the Shareholders were shareholders of such Delaware
corporation and the Trustees were directors of such Delaware
corporation; provided, further, however, that there shall not be
applicable to the Trust, the Trustees, the Shareholders or any
other Person or to this Declaration of Trust or the By-Laws (a)
the provisions of Sections 3533, 3540 and 3583(a) of Title 12 of
the Delaware Code or (b) any provisions of the laws (statutory or
common) of the State of Delaware (other than the DSTA) pertaining
to trusts which relate to or regulate (i) the filing with any
court or governmental body or agency of trustee accounts or
schedules of trustee fees and charges, (ii) affirmative
requirements to post bonds for trustees, officers, agents or
employees of a trust, (iii) the necessity for obtaining court or
other governmental approval concerning the acquisition, holding
or disposition of real or personal property, (iv) fees or other
sums payable to trustees, officers, agents or employees of a
trust, (v) the allocation of receipts and expenditures to income
or principal, (vi) restrictions or limitations on the permissible
nature, amount or concentration of trust investments or
requirements relating to the titling, storage or other manner of
holding of trust assets, or (vii) the establishment of fiduciary
or other standards or responsibilities or limitations on the
indemnification, acts or powers of trustees or other Persons,
which are inconsistent with the limitations of liabilities or
authorities and powers of the Trustees or officers of the Trust
set forth or referenced in this Declaration of Trust or the
By-Laws. The Trust shall be a Delaware statutory trust pursuant
to the DSTA, and without limiting the provisions hereof, the
Trust may exercise all powers that are ordinarily exercised by
such a statutory trust.
FOURTH. This Certificate of Amendment may be signed in one
or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the undersigned Trustees have duly
executed this Certificate of Amendment this 21st day of October,
2008.
/s/ Harris J. Ashton /s/ Robert F. Carlson
Harris J. Ashton, Trustee Robert F. Carlson, Trustee
/s/ Sam Ginn /s/ Edith E. Holiday
Sam Ginn, Trustee Edith E. Holiday, Trustee
/s/ Charles B. Johnson /s/ Rupert H. Johnson, Jr.
Charles B. Johnson, Trustee Rupert H. Johnson, Jr., Trustee
/s/ Frank W. T. LaHaye /s/ Frank A. Olson
Frank W. T. LaHaye, Trustee Frank A. Olson, Trustee
/s/ Larry D. Thompson /s/ John B. Wilson
Larry D. Thompson, Trustee John B. Wilson, Trustee