o FTGT *P3
SUPPLEMENT DATED OCTOBER 1, 1998
TO THE PROSPECTUS OF
FRANKLIN TEMPLETON GLOBAL TRUST
dated March 1, 1998
The prospectus is amended as follows:
I. On August 25, 1998, the German Government and High Income Funds liquidated
their assets and distributed the proceeds to shareholders. All references to
these funds in the prospectus are deleted.
II. The section "Expense Summary" is replaced in its entirety with the
following:
EXPENSE SUMMARY
This table is designed to help you understand the costs of investing in the
Fund. It is based on the Fund's historical expenses for the fiscal year
ended October 31, 1997. The Fund's actual expenses may vary.
GLOBAL HARD
CURRENCY CURRENCY
FUND FUND
------------------------
A. SHAREHOLDER TRANSACTION EXPENSES+
Maximum Sales Charge Imposed on Purchases++
(as a percentage of Offering Price) 2.25% 2.25%
Deferred Sales Charge+++ NONE NONE
Exchange Fee (per transaction) None* None*
B. ANNUAL FUND OPERATING EXPENSES
(as a percentage of average net assets)
Management Fees 0.65% 0.65%
Rule 12b-1 Fees** 0.24% 0.21%
Other Expenses 0.21% 0.27%
------------------------
Total Fund Operating Expenses 1.10% 1.13%
========================
C. EXAMPLE
Assume the Fund's annual return is 5%, operating expenses are as
described above, and you sell your shares after the number of years shown.
These are the projected expenses for each $1,000 that you invest in the
Fund.
1 YEAR*** 3 YEARS 5 YEARS 10 YEARS
---------------------------------------------
Global Currency Fund $33 $57 $82 $154
Hard Currency Fund $34 $58 $83 $157
THIS IS JUST AN EXAMPLE. IT DOES NOT REPRESENT PAST OR FUTURE RETURNS.
ACTUAL EXPENSES AND RETURNS MAY BE MORE OR LESS THAN THOSE SHOWN. The Fund
pays its operating expenses. The effects of these expenses are reflected in
its Net Asset Value or dividends and are not directly charged to your
account.
+If your transaction is processed through your Securities Dealer, you may
be charged a fee by your Securities Dealer for this service.
++There is no front-end sales charge if you invest $1 million or more.
+++A Contingent Deferred Sales Charge of 1% may apply to purchases of $1
million or more if you sell the shares within one year. A Contingent
Deferred Sales Charge may also apply to purchases by certain retirement
plans that qualify to buy shares without a front-end sales charge. See "How
Do I Sell Shares? - Contingent Deferred Sales Charge" for details.
*There is a $5.00 fee for exchanges by Market Timers.
**These fees may not exceed 0.45%. The combination of front-end sales
charges and Rule 12b-1 fees could cause long-term shareholders to pay more
than the economic equivalent of the maximum front-end sales charge
permitted under the NASD's rules.
***Assumes a Contingent Deferred Sales Charge will not apply.
III. The following replaces the paragraph under "How Does the Fund Invest its
Assets? - Global Currency Fund":
GLOBAL CURRENCY FUND
The investment objective of the Global Currency Fund is to maximize the
investor's total return through a combination of interest income and
changes in the Fund's Net Asset Value due to changes in currency exchange
rates. The Fund seeks to achieve its objective by investing in
interest-earning money market instruments. Under normal market conditions,
at least 65% of the Fund's total assets will be invested in instruments
denominated in three or more Major Currencies, including the U.S. dollar.
As a non-fundamental policy, the Fund intends, under normal market
conditions, not to invest more than (i) 50% of its total assets in
instruments denominated in one Major Currency, other than the U.S. dollar,
(ii) 5% of its total assets in instruments denominated in one Non-Major
Currency, or (iii) 25% of its total assets in instruments denominated in
Non-Major Currencies. The Fund may, for defensive purposes or temporarily
to preserve capital, invest up to 100% of its net assets in U.S. dollar
denominated instruments.
IV. The first sentence under "How Does the Fund Invest its Assets? - Types of
Securities in which the Fund May Invest - Global Currency Fund" is replaced
with the following:
The Fund uses the most flexible investment strategy and is designed for
investors seeking the greatest degree of active management among the Major
Currencies and Non-Major Currencies.
V. The second step in the section "How Do I Buy Shares? - Opening Your
Account" is replaced with the following:
2. Determine how much you would like to invest. The Fund's minimum
investments are:
o To open a regular, non-retirement account $1,000
o To open an IRA, IRA Rollover, Roth IRA, or Education IRA $ 250*
o To open a custodial account for a minor (an UGMA/UTMA account) $ 100
o To open an account with an automatic investment plan $ 50**
o To add to an account $ 50***
*For all other retirement accounts, there is no minimum investment
requirement.
**$25 for an Education IRA.
***For all retirement accounts except IRAs, IRA Rollovers, Roth IRAs, or
Education IRAs, there is no minimum to add to an account.
For purchases by broker-dealers, registered investment advisors or
certified financial planners who have entered into an agreement with
Distributors for clients participating in comprehensive fee programs, the
minimum initial investment is $250. The minimum initial investment is $100
for officers, trustees, directors and full-time employees of the Franklin
Templeton Funds or the Franklin Templeton Group, and their family members,
consistent with our then-current policies.
We reserve the right to change the amount of these minimums from time to
time or to waive or lower these minimums for certain purchases. We also
reserve the right to refuse any order to buy shares.
VI. The section "Quantity Discounts," found under "How Do I Buy Shares? -
Sales Charge Reductions and Waivers," is replaced in its entirety with the
following:
QUANTITY DISCOUNTS. The sales charge you pay depends on the dollar amount
you invest, as shown in the table below.
TOTAL SALES CHARGE AMOUNT PAID TO
AS A PERCENTAGE OF DEALER AS A
-----------------------------
AMOUNT OF PURCHASE OFFERING NET AMOUNT PERCENTAGE OF
AT OFFERING PRICE PRICE INVESTED OFFERING PRICE
-------------------------------------------------------------------------------
Under $100,000 2.25% 2.30% 2.00%
$100,000 but less than $250,000 1.75% 1.78% 1.50%
$250,000 but less than $500,000 1.25% 1.26% 1.00%
$500,000 but less than $1,000,000 1.00% 1.01% 0.85%
$1,000,000 or more* None None None
*If you invest $1 million or more, a Contingent Deferred Sales Charge may
be imposed on an early redemption. Please see "How Do I Sell Shares? -
Contingent Deferred Sales Charge." Please also see "Other Payments to
Securities Dealers" below for a discussion of payments Distributors may
make out of its own resources to Securities Dealers for certain purchases.
VII. The following new categories 6 and 7 are added to the end of the first
list of sales charge waiver categories in the section "Sales Charge Waivers,"
found under "How Do I Buy Shares? - Sales Charge Reductions and Waivers":
6. Redemption proceeds from a repurchase of shares of Franklin Floating
Rate Trust, if the shares were continuously held for at least 12 months.
If you immediately placed your redemption proceeds in a Franklin Bank CD
or a Franklin Templeton money fund, you may reinvest them as described
above. The proceeds must be reinvested within 365 days from the date the CD
matures, including any rollover, or the date you redeem your money fund
shares.
7. Redemption proceeds from the sale of Class A shares of any of the
Templeton Global Strategy Funds if you are a qualified investor.
If you paid a contingent deferred sales charge when you redeemed your
Class A shares from a Templeton Global Strategy Fund, a Contingent Deferred
Sales Charge will apply to your purchase of Fund shares and a new
Contingency Period will begin. We will, however, credit your Fund account
with additional shares based on the contingent deferred sales charge you
paid and the amount of the redemption proceeds that you reinvest.
If you immediately placed your redemption proceeds in a Franklin
Templeton money fund, you may reinvest them as described above. The
proceeds must be reinvested within 365 days from the date they are redeemed
from the money fund.
VIII. The following new category 12 is added to the end of the second list of
sales charge waiver categories in the section "Sales Charge Waivers," found
under "How Do I Buy Shares? - Sales Charge Reductions and Waivers":
12. Qualified registered investment advisors who buy through a broker-dealer
or service agent who has entered into an agreement with Distributors
IX. The following paragraph is added at the end of the section "How Do I Buy
Shares?":
FOR INVESTORS OUTSIDE THE U.S.
The distribution of this prospectus and the offering of Fund shares may be
limited in many jurisdictions. An investor who wishes to buy shares of the
Fund should determine, or have a broker-dealer determine, the applicable
laws and regulations of the relevant jurisdiction. Investors are
responsible for compliance with tax, currency exchange or other regulations
applicable to redemption and purchase transactions in any jurisdiction to
which they may be subject. Investors should consult appropriate tax and
legal advisors to obtain information on the rules applicable to these
transactions.
X. The first paragraph under "May I Exchange Shares for Shares of Another
Fund? - Will Sales Charges Apply to My Exchange?" is replaced with the
following:
You generally will not pay a front-end sales charge on exchanges. If you
have held your shares less than six months, however, you will pay the
percentage difference between the sales charge you previously paid and the
applicable sales charge of the new fund, if the difference is more than
0.25%. If you have never paid a sales charge on your shares because, for
example, they have always been held in a money fund, you will pay the
Fund's applicable sales charge no matter how long you have held your
shares. These charges may not apply if you qualify to buy shares without a
sales charge.
XI. The following new item is added under "May I Exchange Shares for Shares
of Another Fund? - Exchange Restrictions":
o You must meet the applicable minimum investment amount of the fund you
are exchanging into, or exchange 100% of your Fund shares.
XII. Distribution option 3 in the section "What Distributions Might I Receive
From the Fund? - Distribution Options" is replaced with the following:
3. RECEIVE DISTRIBUTIONS IN CASH - You may receive dividends, or both
dividend and capital gain distributions in cash. If you have the money
sent to another person or to a checking or savings account, you may
need a signature guarantee. If you send the money to a checking or
savings account, please see "Electronic Fund Transfers" under "Services to
Help You Manage Your Account."
XIII. The section "Keeping Your Account Open," found under "Transaction
Procedures and Special Requirements," is replaced in its entirety with the
following:
KEEPING YOUR ACCOUNT OPEN
Due to the relatively high cost of maintaining a small account, we may
close your account if the value of your shares is less than $250, or less
than $50 for employee accounts and custodial accounts for minors. We will
only do this if the value of your account fell below this amount because
you voluntarily sold your shares and your account has been inactive (except
for the reinvestment of distributions) for at least six months. Before we
close your account, we will notify you and give you 30 days to increase the
value of your account to $1,000, or $100 for employee accounts and
custodial accounts for minors. These minimums do not apply to IRAs and
other retirement plan accounts or to accounts managed by the Franklin
Templeton Group.
XIV. The second sentence in the section "Services to Help You Manage Your
Account - Automatic Investment Plan" is replaced with the following:
Under the plan, you can have money transferred automatically from your
checking or savings account to the Fund each month to buy additional shares.
XV. The second paragraph under "Services to Help You Manage Your Account -
Systematic Withdrawal Plan" is replaced with the following:
If you would like to establish a systematic withdrawal plan, please
complete the systematic withdrawal plan section of the shareholder
application included with this prospectus and indicate how you would like
to receive your payments. You may choose to direct your payments to buy the
same class of shares of another Franklin Templeton Fund or have the money
sent directly to you, to another person, or to a checking or savings
account. If you choose to have the money sent to a checking or savings
account, please see "Electronic Fund Transfers" below. Once your plan is
established, any distributions paid by the Fund will be automatically
reinvested in your account.
XVI. The section "Services to Help You Manage Your Account - Electronic Fund
Transfers" is replaced with the following:
ELECTRONIC FUND TRANSFERS
You may choose to have dividend and capital gain distributions or payments
under a systematic withdrawal plan sent directly to a checking or savings
account. If the account is with a bank that is a member of the Automated
Clearing House, the payments may be made automatically by electronic funds
transfer. If you choose this option, please allow at least fifteen days for
initial processing. We will send any payments made during that time to the
address of record on your account.
XVII. Under the section "Services to Help You Manage Your Account -
TeleFACTS(R)," the code number table is replaced with the following:
CODE
FUND NUMBER
--------------------------------
Global Currency Fund 411
Hard Currency Fund 412
XVIII. The following definitions are revised in the "Useful Terms and
Definitions" section:
CONTINGENCY PERIOD - The 12 month period during which a Contingent Deferred
Sales Charge may apply. The holding period begins on the day you buy your
shares. For example, if you buy shares on the 18th of the month, they will
age one month on the 18th day of the next month and each following month.
MAJOR CURRENCIES - As used in this prospectus, Australian dollar, Belgian
franc, British pound sterling, Canadian dollar, Danish krone, Netherlands
guilder, the Euro, European Currency Unit ("ECU"), French franc, German
mark, Greek drachma, Irish punt, Italian lira, Japanese yen, New Zealand
dollar, Norwegian krona, Spanish peseta, Swedish krona, Swiss franc and
U.S. dollar.
NON-MAJOR CURRENCIES - As used in this prospectus, all currencies that are
not identified as Major Currencies.
OFFERING PRICE - The public offering price is based on the Net Asset Value
per share and includes the front-end sales charge. The maximum front-end
sales charge is 2.25%. We calculate the offering price to two decimal
places using standard rounding criteria.
XIX. The following paragraphs are added to the end of the section "What Are
the Risks of Investing in the Fund? - Currency Funds."
EURO. On January 1, 1999, the European Monetary Union (EMU) plans to
introduce a new single currency, the Euro, which will replace the national
currency for participating member countries. If the Fund holds investments
in countries with currencies replaced by the Euro, the investment process,
including trading, foreign exchange, payments, settlements, cash accounts,
custody and accounting will be impacted.
The process to establish the Euro may result in market volatility. It is
not possible to predict the impact of the Euro on the business or financial
condition of European issuers or on the Fund. The transition and the
elimination of currency risk among EMU countries may change the economic
environment and behavior of investors, particularly in European markets. To
the extent the Fund holds non-U.S. dollar (Euro or other) denominated
securities, it will still be exposed to currency risk due to fluctuations
in those currencies versus the U.S. dollar.
Resources has created an interdepartmental team to handle all Euro-related
changes to enable the Franklin Templeton Funds to process transactions
accurately and completely with minimal disruption to business activities.
While there can be no assurance that the Fund will not be adversely
affected, the Managers and its affiliated service providers are taking
steps that they believe are reasonably designed to address the Euro issue.
Please keep this supplement for future reference.
