SUPPLEMENT TO THE PROSPECTUS
PROSPECTUS DATED JUNE 27, 1994
(AS PREVIOUSLY SUPPLEMENTED SEPTEMBER 1, 1994,
NOVEMBER 15, 1994 AND DECEMBER 6, 1994)
Templeton Americas Government Securities Fund
* * *
PROSPECTUS DATED JANUARY 1, 1995
Templeton Income Fund
* * *
The text of the footnote to the sales charge table under "HOW TO BUY SHARES OF
THE FUND-OFFERING PRICE" is deleted and replaced with the following text:
*The following commissions will be paid by FTD, from its own resources, to
securities dealers who initiate and are responsible for purchases of $1 million
or more: 0.75% on sales of $1 million but less $2 million, plus 0.60% on sales
of $2 million but less than $3 million, plus 0.50% on sales of $3 million but
less than $50 million, plus 0.25% on sales of $50 million but less than $100
million, plus 0.15% on sales of $100 million or more. Dealer concession
breakpoints are reset every 12 months for purposes of additional purchases.
The following paragraph is added to the section entitled "HOW TO BUY SHARES OF
THE FUND-OFFERING PRICE":
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FTD, or one of its affiliates, may make payments, from its own resources, of
up to 0.75% of the amount purchased to securities dealers who initiate and are
responsible for purchases made at net asset value by non-designated retirement
plans, and up to 1% of the amount purchased to securities dealers who initiate
and are responsible for purchases made at net asset value by certain designated
retirement plans (as defined below) (excluding IRA and IRA rollovers), certain
trust companies and trust departments of banks and certain retirement plans
of organizations with collective retirement plan assets of $10 million or
more). Please refer to the SAI for further information.
The second paragraph of the section entitled "HOW TO BUY SHARES OF THE FUND-
OFFERING PRICE" is deleted and replaced with the following:
No initial sales charge applies on investments of $1 million or more, but a
contingent deferred sales charge of 1% is imposed on certain redemptions of
investments of $1 million or more within 12 months of the calendar month
following such investments ("contingency period"). See "How to Sell Shares of
the Fund - Contingent Deferred Sales Charge."
The following text is added to the fifth paragraph of the section entitled "HOW
TO BUY SHARES OF THE FUND-OFFERING PRICE":
Effective February 1, 1995, securities dealers will be paid distribution fees
beginning in the 13th month after the date of the purchase, for purchases of
$1 million or more of Fund Shares that are subject to a contingent deferred
sales charge.
The second sentence of the section entitled "HOW TO BUY SHARES OF THE FUND-
CUMULATIVE QUANTITY DISCOUNT" is deleted and replaced with the following:
For this purpose, the dollar amount of the sale is added to the higher of (1)
the value (calculated at the applicable Offering Price) or (2) the purchase
price, of the following: (a) Shares of the Fund; (b) Shares of other funds
in the Franklin Templeton Group (except Templeton Capital Accumulator Fund,
Inc., Templeton Variable Annuity Fund, Templeton Variable Products Series Fund,
Franklin Valuemark Funds and Franklin Government Securities Trust); and (c)
other investment products underwritten by FTD or its affiliates (although
certain investments may not have the same schedule of sales charges and/or
may not be subject to reduction in sales charges). Clauses (a), (b) and (c)
above are collectively referred to as "Franklin Templeton Investments".
The cumulative quantity discount applies to Franklin Templeton Investments
owned at the time of purchase by the purchaser, his or her spouse, and their
children under age 21.
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The text of the section entitled "HOW TO BUY SHARES OF THE FUND-LETTER OF
INTENT" is deleted and replaced with the following:
Investors may also reduce sales charges on all investments by means of a Letter
of Intent ("LOI") which expresses the investor's intention to invest a certain
amount within a 13-month period in Shares of the Fund or any other fund in the
Franklin Templeton Group (except Templeton Capital Accumulator Fund, Inc.,
Templeton Variable Annuity Fund, Templeton Variable Products Series Fund,
Franklin Valuemark Funds and Franklin Government Securities Trust). See the
Shareholder Application. Except for certain employee benefit plans, the minimum
initial investment under an LOI is 5% of the total LOI amount. Except for
Shares purchased by certain employee benefit plans, Shares purchased with the
first 5% of such amount will be held in escrow to secure payment of the
higher sales
charge applicable to the Shares actually purchased if the full amount indicated
is not purchased, and such escrowed Shares will be involuntarily redeemed to pay
the additional sales charge, if necessary. A purchase not originally made
pursuant to an LOI may be included under a subsequent LOI executed within 90
days of the purchase. Any redemptions made by Shareholders, other than by
certain employee benefit plans, during the 13-month period will be subtracted
from the amount of the purchases for purposes of determining whether the
terms of the LOI have been completed. For a further description of the
Letter of Intent, see "Purchase, Redemption and Pricing of Shares-Letter of
Intent" in the SAI.
The text of the section entitled "HOW TO BUY SHARES OF THE FUND-NET ASSET VALUE
PURCHASES" is deleted and replaced with the following:
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Shares of the Fund may be purchased without the imposition of either an initial
sales charge ("net asset value") or a contingent deferred sales charge by (1)
officers, trustees, directors, and full-time employees of the Fund, of Franklin
Resources, Inc. and it subsidiaries, or of other fund in the Franklin
Templeton Group, and by their spouses and family members; (2) companies
exchanging shares with or selling assets pursuant to a merger, acquisition or
exchange offer; (3) insurance company separate accounts for pension plan con-
tracts; (4) accounts managed by the subisidiaries of Franklin Resources, Inc.
(including the Franklin Templeton Group); (5) Shareholders of Templeton
Institutional Funds, Inc. reinvesting redemption proceeds from that fund
under an employee benefit plan qualified under Section 401 of the Internal
Revenue Code of 1986, as amended, in shares of the Fund; (6) certain unit
investment trusts and unit holders of such trusts reinvesting their distribu-
tions from the trusts in the Fund; (7) registered securities dealers and
their affiliates, for their investment account only, and (8) registered
personnel and employees of securities dealers, and by their spouses and
family members, in accordance with the internal policies and procedures of
the employing securities dealer.
Shares of the Fund may be purchased at net asset value and without the
imposition of a contingent deferred sales charge by REGISTERED investment
advisers and/or their affiliated broker-dealers, who have entered into a
supplemental agreement with FTD, on behalf of their clients who are
participating in a comprehensive fee program (also known as a wrap fee program).
Shares of the Fund may also be purchased at net asset value and without the
imposition of a contingent deferred sales charge by certain designated
retirement plans, including profit sharing, pension, 401(k) and simplified
employee pension plans ("designated plans"), subject to minimum requirements
with respect to number of employees or amount of purchase, which may be
established by FTD. Currently, those criteria require that the employer
establishing the plan have 200 or more employees or that the amount invested
or to be invested during the subsequent 13-month period in the Fund or in any
of the Franklin Templeton Investments totals at least $1 million. Employee
benefit plans not designated above or qualified under Section 401 of the Code
("non-designated plans") may be afforded the same privilege if they meet the
above requirements as well as the uniform criteria for qualified groups pre-
viously described under "Group Purchases", which enable FTD to realize
economies of scale in its sales efforts and sales related expenses. Please
refer to the SAI for further information.
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Shares of the Fund may be purchased at net asset value and without the
imposition of a contingent deferred sales charge by anyone who has taken a
distribution from an existing retirement plan already invested in the
Franklin Templeton Funds (including former participants of the Franklin
Templeton Profit Sharing 401(k) plan). In order to exercise this privilege,
a written order for the purchase of Shares of the Fund must be received by
Franklin Templeton Trust Company, the Fund, or Franklin Templeton Investor
Services, Inc. (the "Transfer Agent") within 120 days after the plan distrib-
ution. To obtain a free Prospectus for any fund in the Franklin Templeton
Group, please call toll free at 1-800-DIAL BEN (1-800-342-5236).
Shares of the Fund may be purchased at net asset value and without the
imposition of a contingent deferred sales charge by trust companies and bank
trust departments for funds over which they exercise exclusive discretionary
investment authority and which are held in a fiduciary, agency, advisory,
custodial or similar capacity. Such purchases are subject to minimum
requirements with respect to amount of purchase, which may be established by
FTD. Currently, those criteria require that the amount invested or to be
invested during the subsequent 13-month period in the Fund or any of the
Franklin Templeton Investments must total at least $1 million. Orders for
such accounts will be accepted by mail accompanied by a check or by telephone
or other means of electronic data transfer directly from the bank or trust
company, with payment by federal funds received by the close of business on
the next business day following such order.
Shares of the Fund may be purchased at net asset value and without the
imposition of a contingent deferred sales charge by investors who have,
within the past 60 days, redeemed an investment in an unaffiliated mutual
fund which charged the investor a contingent deferred sales charge upon
redemption and which has investment objectives similar to those of the Fund.
Shares of the Fund may also be purchased at net asset value and without the
imposition of a contingent deferred sales charge by any state, county, or city,
or any instrumentality, department, authority or agency thereof which has
determined that the Fund is a legally permissible investment and which is
prohibited by applicable investment laws from paying a sales charge or
commission in connection with the purchase of Shares of any registered
management investment company ("an eligible governmental authority"). SUCH
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INVESTORS SHOULD CONSULT THEIR OWN LEGAL ADVISORS TO DETERMINE WHETHER AND TO
WHAT EXTENT THE SHARES OF THE FUND CONSTITUTE LEGAL INVESTMENTS FOR THEM.
Municipal investors considering investment of proceeds of bond offerings into
the Fund should consult with expert counsel to determine the effect, if any,
of various payments made by the Fund or its investment manager on arbitrage
rebate calculations. If an investment by an eligible governmental authority at
net asset value is made through a securities dealer who has executed a dealer
agreement with FTD, FTD or one of its affiliates may make a payment, out of
its own resources, to such securities dealer in an amount not to exceed 0.25%
of the amount invested. Contact Franklin Templeton Institutional Services for
additional information.
Shares of the Fund may be purchased at net asset value and without the imposi-
tion of a contingent deferred sales charge by trustees or other fiduciaries pur-
chasing securities for certain retirement plans of organizations with collective
retirement plan assets of $10 million or more, without regard to where such
assets are currently invested.
The first paragraph of the section entitled "EXCHANGE PRIVILEGE" is deleted and
replaced with the following:
A Shareholder may exchange Shares into other funds in the Franklin Templeton
Group (except Templeton American Trust, Inc., Templeton Capital Accumulator
Fund, Inc., Templeton Variable Annuity Fund, Templeton Variable Products
Series Fund, Franklin Valuemark Funds and Franklin Government Securities
Trust). A contingent deferred sales charge will not be imposed on exchanges.
If, however, the exchanged Shares were subject to a contingent deferred sales
charge in the original fund purchased, and Shares are subsequently redeemed
within the contingency period, a contingent deferred sales charge will be
imposed. The contingency period will be tolled (or stopped) for the period
such Shares are exchanged into and held in a Franklin or Templeton money
market fund. See also "How to Sell Shares of the Fund - Contingent Deferred
Sales Charge."
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The text of the section entitled "HOW TO SELL SHARES OF THE FUND-REINSTATEMENT
PRIVILEGE" is deleted and replaced with the following:
Shares of the Fund may be purchased at net asset value with the proceeds from
(i) a redemption of Shares of any fund in the Franklin Templeton Group (except
Templeton American Trust, Inc., Templeton Capital Accumulator Fund, Inc.,
Templeton Variable Annuity Fund, Templeton Variable Products Series Fund,
Franklin Valuemark Funds and Franklin Government Securities Trust) which were
purchased with an initial sales charge or assessed a contingent deferred sales
charge on redemption, within 120 days after the date of the redemption; or
(ii) a dividend or distribution paid by any Fund in the Franklin Templeton
Group, within 120 days after the date of the dividend or distribution.
However, if a Shareholder's original investment was in a Fund with a lower
sales charge, or no sales charge, the Shareholder must pay the difference.
While credit will be given for any contingent deferred sales charge paid on
the Shares redeemed, a new contingency period will begin. Shares of the Fund
redeemed in connection with an exchange into another fund (see "Exchange
Privilege") are not considered "redeemed" for this privilege. In order to
exercise this privilege, a written order for the purchase of Shares of the
Fund must be received by the Fund or the Fund's Transfer Agent within 120
days after the redemption. The 120 days, however, do not begin to run on
redemption proceeds placed immediately after redemption in a Franklin Bank
Certificate of Deposit ("CD") until the CD (including any rollover) matures.
The amount of gain or loss resulting from a redemption may be affected by
exercise of the reinstatement privilege if the Shares redeemed were held for
90 days or less, or if a Shareholder reinvests in the same fund within 30 days.
Reinvestment will be at the next calculated net asset value after receipt.
The text of the section entitled "HOW TO SELL SHARES OF THE FUND-CONTINGENT
DEFERRED SALES CHARGE" is deleted and replaced with the following:
<PAGE>
In order to recover commissions paid to securities dealers on qualified
investments of $1 million or more, a contingent deferred sales charge of 1%
applies to redemptions of those investments within the contingency period of 12
months of the calendar month following their purchase. The charge is 1% of the
lesser of the value of the Shares redeemed (exclusive of reinvested dividends
and capital gains distributions) or the total cost of such Shares, and is re-
tained by FTD. In determining if a charge applies, Shares not subject to a
contingent deferred sales charge are deemed to be redeemed first, in the
following order: (i) Shares representing amounts attributable to capital
appreciation of those Shares held less than 12 months; (ii) Shares purchased
with reinvested dividends
and capital gains distributions; and (iii) other Shares held longer than 12
months, followed by any Shares held less than 12 months, on a "first in, first
out" basis.
The contingent deferred sales charge is waived for: exchanges; distributions to
participants in Franklin Templeton Trust Company or Templeton Funds Trust
Company retirement plan accounts due to death, disability or attainment of
age 59 1/2; tax-free returns of excess contributions to employee benefit
plans; distributions from employee benefit plans, including those due to plan
termination or plan transfer; redemptions through a Systematic Withdrawal Plan
established prior to February 1, 1995 and, for Systematic Withdrawal Plans
established thereafter, redemptions of up to 1% monthly of an account's net
asset value (3% quarterly, 6% semiannually or 12% annually); and redemptions
initiated by the Fund due to a Shareholder's account falling below the
minimum specified account size.
Requests for redemptions for a specified dollar amount will result in additional
Shares being redeemed to cover any applicable contingent deferred sales charge
while requests for redemption of a specific number of Shares will result in the
applicable contingent deferred sales charge being deducted from the total dollar
amount redeemed.
February 1, 1995 TLCDS STKR2 2/95
