o 115 P-4
SUPPLEMENT DATED SEPTEMBER 1, 2000
TO THE PROSPECTUS OF
FRANKLIN NEW YORK TAX-FREE INCOME FUND
DATED OCTOBER 1, 1999
The prospectus is amended as follows:
I. The management team on page 10 is replaced with the following:
The team responsible for the fund's management is:
SHEILA AMOROSO, SENIOR VICE PRESIDENT OF ADVISERS
Ms. Amoroso has been an analyst or portfolio manager of the fund since
1987. She is the co-Director of Franklin's Municipal Bond Department. She
joined the Franklin Templeton Group in 1986.
JAMES CONN, VICE PRESIDENT OF ADVISERS
Mr. Conn has been an analyst or portfolio manager of the Fund since 1999.
He joined the Franklin Templeton Group in 1996. Previously, he was a
portfolio manager with California Investment Trust.
JOHN POMEROY, VICE PRESIDENT OF ADVISERS
Mr. Pomeroy has been an analyst or portfolio manager of the Fund since
1989. He joined the Franklin Templeton Group in 1986.
II. The section "Sales charge waivers" on page 20 is replaced with the
following:
SALES CHARGE WAIVERS Class A shares may be purchased without an initial sales
charge or CDSC by various individuals, institutions and retirement plans or by
investors who reinvest certain distributions and proceeds within 365 days.
Certain investors also may buy Class C shares without an initial sales charge.
The CDSC for each class may be waived for certain redemptions and
distributions. If you would like information about available sales charge
waivers, call your investment representative or call Shareholder Services at
1-800/632-2301. A list of available sales charge waivers also may be found in
the Statement of Additional Information (SAI).
III. The section "Minimum investments" on page 21 is replaced with the
following:
MINIMUM INVESTMENTS
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INITIAL ADDITIONAL
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Regular accounts $1,000 $50
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Automatic investment plans $50 $50
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UGMA/UTMA accounts $100 $50
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Broker-dealer sponsored wrap account
programs $250 $50
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Full-time employees, officers, trustees
and directors of Franklin Templeton
entities, and their immediate family
members $100 $50
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PLEASE NOTE THAT YOU MAY ONLY BUY SHARES OF A FUND ELIGIBLE
FOR SALE IN YOUR STATE OR JURISDICTION.
IV. The section "Account Application" on page 22 is replaced with the
following:
ACCOUNT APPLICATION If you are opening a new account, please complete and sign
the enclosed account application. Make sure you indicate the share class you
have chosen. If you do not indicate a class, we will place your purchase in
Class A shares. To save time, you can sign up now for services you may want on
your account by completing the appropriate sections of the application (see
"Investor Services" on page 23). For example, if you would like to link one of
your bank accounts to your Fund account so that you may use electronic fund
transfers to and from your bank account to buy and sell shares, please complete
the bank information section of the application. We will keep your bank
information on file for future purchases and redemptions.
V. The following is added to the section "Buying shares" on page 22:
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[Insert graphic of phone] If you have another Before requesting a
BY PHONE Franklin Templeton fund telephone purchase,
account with your bank please make sure we have
(Up to $100,000 per day) account information on your bank account
file, you may open a new information on file. If
1-800/632-2301 account by phone. we do not have this
information, you will
To make a same day need to send written
investment, please call instructions with your
us by 1:00 p.m. Pacific bank's name and address,
time or the close of the a voided check or
New York Stock Exchange, savings account deposit
whichever is earlier. slip, and a signature
guarantee if the bank
and fund accounts do not
have at least one common
owner.
To make a same day
investment, please call
us by 1:00 p.m. Pacific
time or the close of the
New York Stock Exchange,
whichever is earlier.
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VI. The section "Automatic Investment Plan" on page 23 is replaced with the
following:
AUTOMATIC INVESTMENT PLAN This plan offers a convenient way for you to invest
in the Fund by automatically transferring money from your checking or savings
account each month to buy shares. To sign up, complete the appropriate section
of your account application and mail it to Investor Services. If you are
opening a new account, please include the minimum initial investment of $50
with your application.
VII. The section "Telephone Privileges" on page 23 is replaced with the
following:
TELEPHONE PRIVILEGES You will automatically receive telephone privileges when
you open your account, allowing you and your investment representative to buy,
sell or exchange your shares and make certain other changes to your account by
phone.
For accounts with more than one registered owner, telephone privileges also
allow the Fund to accept written instructions signed by only one owner for
transactions and account changes that could otherwise be made by phone. For all
other transactions and changes, all registered owners must sign the
instructions. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one signature
for all transactions. This type of telephone exchange is available as long as
you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone purchase, exchange or redemption privileges
on your account application.
VIII. The last paragraph of the "Exchange Privilege" section on page 24 is
replaced with the following:
Because excessive trading can hurt fund performance, operations and
shareholders, the fund, effective November 1, 2000, reserves the right to
revise or terminate the exchange privilege, limit the amount or number of
exchanges, reject any exchange, or restrict or refuse purchases if (i) the fund
or its manager believes the fund would be harmed or unable to invest
effectively, or (ii) the fund receives or anticipates simultaneous orders that
may significantly affect the fund (please see "Market Timers" on page 29).
VIII. In the Selling Shares table on page 27 the section "By Electronic Funds
Transfer (ACH)" is replaced with the following:
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[Insert graphic of You can call or write to have redemption proceeds sent
three lightning bolts] to a bank account. See the policies above for selling
BY ELECTRONIC FUNDS shares by mail or phone.
TRANSFER (ACH)
Before requesting to have redemption proceeds sent to a
bank account, please make sure we have your bank
account information on file. If we do not have this
information, you will need to send written instructions
with your bank's name and address, a voided check or
savings account deposit slip, and a signature guarantee
if the bank and fund accounts do not have at least one
common owner.
If we receive your request in proper form by 1:00 p.m.
Pacific time, proceeds sent by ACH generally will be
available within two to three business days.
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IX. The section "Statements and Reports" on page 28 is replaced with the
following:
STATEMENTS AND REPORTS You will receive quarterly account statements that show
all your account transactions during the quarter. You also will receive written
notification after each transaction affecting your account (except for
distributions and transactions made through automatic investment or withdrawal
programs, which will be reported on your quarterly statement). You also will
receive the Fund's financial reports every six months. To reduce Fund expenses,
we try to identify related shareholders in a household and send only one copy
of the financial reports. If you need additional copies, please call 1-800/DIAL
BEN.
If there is a dealer or other investment representative of record on your
account, he or she also will receive copies of all notifications and statements
and other information about your account directly from the Fund.
X. The section "Market Timers" on page 29 is replaced with the following:
MARKET TIMERS The fund does not allow investments by Market Timers. You may be
considered a Market Timer if you have (i) requested an exchange out of any of
the Franklin Templeton funds within two weeks of an earlier exchange request
out of any fund, or (ii) exchanged shares out of any of the Franklin Templeton
funds more than twice within a rolling 90 day period, or (iii) otherwise seem
to follow a market timing pattern that may adversely affect the fund. Accounts
under common ownership or control with an account that is covered by (i), (ii),
or (iii) are also subject to these limits.
XI. The first category in the section "Additional Policies" on page 29 is
revised to read:
o The fund may restrict or refuse any order to buy shares, including any
purchase under the exchange privilege.
XII. The section "Dealer Compensation" on page 30 is replaced with the
following:
DEALER COMPENSATION Qualifying dealers who sell Fund shares may receive sales
commissions and other payments. These are paid by Franklin Templeton
Distributors, Inc. from sales charges, distribution and service (12b-1) fees
and its other resources.
CLASS A CLASS B CLASS C
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COMMISSION (%) -- 3.00 2.00
Investment under $100,000 4.00 -- --
$100,000 but under $250,000 3.25 -- --
$250,000 but under $500,000 2.25 -- --
$500,000 but under $1 million 1.85 -- --
$1 million or more up to 0.75/1 -- --
12B-1 FEE TO DEALER 0.10 0.15/2 0.65/3
A dealer commission of up to 1% may be paid on Class C NAV purchases. A dealer
commission of up to 0.25% may be paid on Class A NAV purchases by certain trust
companies and bank trust departments, eligible governmental authorities, and
broker-dealers or others on behalf of clients participating in comprehensive
fee programs.
1. During the first year after purchase, dealers may not be eligible to
receive the 12b-1 fee.
2. Dealers may be eligible to receive up to 0.15% from the date of purchase.
After 8 years, Class B shares convert to Class A shares and dealers may then
receive the 12b-1 fee applicable to Class A.
3. Dealers may be eligible to receive up to 0.15% during the first year after
purchase and may be eligible to receive the full 12b-1 fee starting in the 13th
month.
Please keep this supplement for future reference.