TEMPLETON GROWTH FUND INC, 497, 1998-01-02

TEMPLETON GROWTH FUND INC
497, 1998-01-02

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PROSPECTUS & APPLICATION

INVESTMENT STRATEGY: Templeton
GLOBAL GROWTH Growth
Fund, Inc.
---------------------------------------------
JANUARY 1, 1998

FRANKLIN TEMPLETON LOGO

- --------------------------------------------------------------------------------

This prospectus describes Class I and Class II shares of Templeton Growth Fund,
Inc. (the "Fund"). It contains information you should know before investing in
the Fund. Please keep it for future reference.

The Fund currently offers another class of shares with a different sales charge
and expense structure, which affects performance. This class is described in a
separate prospectus. For more information, contact your investment
representative or call 1-800/DIAL BEN.

The Fund has a Statement of Additional Information ("SAI") for its Class I and
Class II shares, dated January 1, 1998, which may be amended from time to time.
It includes more information about the Fund's procedures and policies. It has
been filed with the SEC and is incorporated by reference into this prospectus.
For a free copy or a larger print version of this prospectus, call 1-800/DIAL
BEN.

SHARES OF THE FUND ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY,
ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION,
THE FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY OF THE U.S. GOVERNMENT. SHARES
OF THE FUND INVOLVE INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.

LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SEC OR ANY STATE SECURITIES COMMISSION NOR HAS THE SEC OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<PAGE>

TEMPLETON
GROWTH FUND, INC.
- --------------------------------------------------------------------------------

THIS PROSPECTUS IS NOT AN OFFERING OF THE SECURITIES HEREIN DESCRIBED IN ANY
STATE, JURISDICTION OR COUNTRY IN WHICH THE OFFERING IS NOT AUTHORIZED. NO SALES
REPRESENTATIVE, DEALER, OR OTHER PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR
MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS. FURTHER
INFORMATION MAY BE OBTAINED FROM DISTRIBUTORS.

<PAGE>

<TABLE>
<S> <C>
TABLE OF CONTENTS
ABOUT THE FUND
Expense Summary ..........................2
Financial Highlights .....................4
How Does the Fund Invest Its Assets? .....6
What Are the Risks of Investing in the
Fund? ...................................10
Who Manages the Fund? ...................12
How Does the Fund Measure
Performance? ............................15
How Taxation Affects the Fund and Its
Shareholders ............................15
How Is the Fund Organized? ..............21

TEMPLETON ABOUT YOUR ACCOUNT
GROWTH How Do I Buy Shares? ....................22
FUND, INC.
- ----------------------- May I Exchange Shares for Shares of
January 1, 1998 Another Fund? .....29
When reading this How Do I Sell Shares? ...................33
prospectus, you
will see certain terms What Distributions Might I Receive From
beginning with capital the Fund? .....37
letters. This means the Transaction Procedures and Special
term is explained in Requirements ...........................38
our glossary section. Services to Help You Manage Your
Account ................................43
100 Fountain Parkway What If I Have Questions About My
P.O. Box 33030 Account? ...............................45
St. Petersburg, FL GLOSSARY
33733-8030 Useful Terms and
1-800/DIAL BEN Definitions ............................47
</TABLE>

Templeton Growth Fund, Inc. globe 1

<PAGE>

ABOUT THE FUND

EXPENSE SUMMARY

This table is designed to help you understand the costs of investing in the
Fund. It is based on the historical expenses of each class for the fiscal year
ended August 31, 1997. The Fund's actual expenses may vary.

A. SHAREHOLDER TRANSACTION EXPENSES(+)

<TABLE>
<CAPTION>
CLASS I CLASS II
------- --------
<S> <C> <C> <C>
Maximum Sales Charge
(as a percentage of Offering Price) 5.75% 1.99%
Paid at time of purchase 5.75%(++) 1.00%(+++)
Paid at redemption(++++) None 0.99%
Exchange Fee (per transaction) $5.00* $5.00*
</TABLE>

B. ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)

Management Fees 0.61% 0.61%
Rule 12b-1 Fees 0.24%** 1.00%**
Other Expenses 0.23% 0.23%
------- --------
Total Fund Operating Expenses 1.08% 1.84%
</TABLE>

C. EXAMPLE
Assume the annual return for each class 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.

<TABLE>
<CAPTION>
ONE YEAR THREE YEARS FIVE YEARS TEN YEARS
------------------------------------------------------------------
<S> <C> <C> <C> <C>

Class I $ 68*** $90 $114 $182
Class II $ 38 $67 $109 $224
</TABLE>

For the same Class II investment, you would pay projected expenses of $29 if
you did not sell your shares at the end of the first year. Your projected
expenses for the remaining periods would be the same.

THIS IS JUST AN EXAMPLE. IT DOES NOT REPRESENT PAST OR FUTURE EXPENSES OR
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 the Net Asset Value or dividends of each class 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.

2 globe Templeton Growth Fund, Inc.

<PAGE>

(++)There is no front-end sales charge if you invest $1 million or more in Class
I shares.

(+++)Although Class II has a lower front-end sales charge than Class I, its Rule
12b-1 fees are higher. Over time you may pay more for Class II shares. Please
see "How Do I Buy Shares? - Choosing a Share Class."

(++++)A Contingent Deferred Sales Charge may apply to any Class II purchase if
you sell the shares within 18 months and to Class I 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
Class I shares without a front-end sales charge. The charge is 1% of the value
of the shares sold or the Net Asset Value at the time of purchase, whichever is
less. The number in the table shows the charge as a percentage of Offering
Price. While the percentage is different depending on whether the charge is
shown based on the Net Asset Value or the Offering Price, the dollar amount paid
by you would be the same. See "How Do I Sell Shares? - Contingent Deferred Sales
Charge" for details.

*$5.00 fee is only for Market Timers. We process all other exchanges without a
fee.

**These fees may not exceed 0.25% for Class I and 1.00% for Class II. 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.

Templeton Growth Fund, Inc. globe 3

<PAGE>

FINANCIAL HIGHLIGHTS

This table summarizes the Fund's financial history. The information has been
audited by McGladrey & Pullen, LLP, the Fund's independent auditors. Their audit
report covering each of the most recent five years appears in the financial
statements in the Fund's Annual Report to Shareholders for the fiscal year ended
August 31, 1997. The Annual Report to Shareholders also includes more
information about the Fund's performance. For a free copy, please call Fund
Information.

CLASS I SHARES

Year Ended August 31 1997 1996 1995
- ---------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share Operating Performance
(for a share outstanding throughout the
year)
Net Asset Value, beginning of year $ 18.75 $ 18.96 $ 18.95
-----------
Income from investment operations:
Net investment income .54 .50 .39
Net realized and unrealized gains
(losses) 4.48 1.34 1.20
-----------
Total from investment operations 5.02 1.84 1.59
-----------
Less distributions:
Dividends from net investment income (.49) (.44) (.29)
Distributions from net realized gains (.81) (1.61) (1.29)
-----------
Total distributions (1.30) (2.05) (1.58)
-----------
Net Asset Value, end of year $ 22.47 $ 18.75 $ 18.96
===========
Total return(1) 28.28% 10.85% 9.51%
Ratios/Supplemental Data:
Net assets, end of year (000) $12,129,283 $8,450,737 $6,964,298
Ratios to average net assets:
Expenses 1.08% 1.09% 1.12%
Net investment income 2.81% 2.87% 2.40%
Portfolio turnover rate 41.81% 19.63% 35.21%
Average commission rate paid(2) $ .0007 $ .0146 --
</TABLE>

(1)Total return does not reflect sales commissions.

(2)Relates to purchases and sales of equity securities. Prior to fiscal year end
1996 disclosure of average commission rate was not required.

4 globe Templeton Growth Fund, Inc.

<PAGE>

Templeton Growth Fund, Inc. globe 5

<PAGE>

CLASS II SHARES

Year Ended August 31 1997 1996 1995(1)
- ---------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share Operating Performance
(for a share outstanding throughout the period)
Net Asset Value, beginning of period $ 18.57 $ 18.90 $ 17.48
Income from investment operations:
Net investment income .42 .49 .04
--------
Net realized and unrealized gains 4.39 1.19 1.38
--------
Total from investment operations 4.81 1.68 1.42
--------
Less distributions:
Dividends from net investment income (.39) (.40) --
Distributions from net realized gains (.81) (1.61) --
--------
Total distributions (1.20) (2.01) --
--------
Net Asset Value, end of period $ 22.18 $ 18.57 $ 18.90
========
Total return(2) 27.30% 9.99% 8.12%
Ratios/Supplemental Data:
Net assets, end of period (000) $755,184 $280,087 $42,548
Ratios to average net assets:
Expenses 1.84% 1.87% 1.86%(3)
Net investment income 2.14% 2.25% 1.61%(3)
Portfolio turnover rate 41.81% 19.63% 35.21%
Average commission rate paid(4) $ .0007 $ .0146 --
</TABLE>

(1)For the period from May 1, 1995 (commencement of sales) through August 31,
1995.

(2)Total return does not reflect sales commissions or the Contingent Deferred
Sales Charge and is not annualized.

(3)Annualized.

(4)Relates to purchases and sales of equity securities. Prior to fiscal year end
1996 disclosure of average commission rate was not required.

HOW DOES THE FUND INVEST ITS ASSETS?

WHAT IS THE FUND'S GOAL?

The investment goal of the Fund is long-term capital growth. This goal is
fundamental which means that it may not be changed without shareholder approval.

WHAT KINDS OF SECURITIES DOES THE FUND PURCHASE?

The Fund tries to achieve its investment goal by a flexible policy of investing
in the equity and debt securities of companies and governments of any nation.

6 globe Templeton Growth Fund, Inc.

<PAGE>

EQUITY SECURITIES generally entitle the holder to participate in a company's
general operating results. These include common stock; preferred stock;
convertible securities; warrants or rights. The Fund's primary investments are
in common stock.

In selecting these equity securities, Global Advisors does a company-by-company
analysis, rather than focusing on a specific industry or economic sector. Global
Advisors concentrates primarily on the market price of a company's securities
relative to its view regarding the company's long-term earnings potential. A
company's historical value measures, including price/earnings ratios, profit
margins and liquidation value, will also be considered.

DEBT SECURITIES represent an obligation of the issuer to repay a loan of money
to it, and generally, provide for the payment of interest. These include bonds,
notes and debentures; commercial paper; time deposits; bankers' acceptances; and
structured investments which are described more fully in the SAI.

The Fund may buy both rated and unrated debt securities. Independent rating
organizations rate debt securities based upon their assessment of the financial
soundness of the issuer. Generally, a lower rating indicates higher risk. The
Fund may buy debt securities which are rated Caa by Moody's or CCC by S&P or
better; or unrated debt which it determines to be of comparable quality. At
present, the Fund does not intend to invest more than 5% of its total assets in
non-investment grade securities (rated lower than BBB by S&P or Baa by Moody's).
Please see the SAI for more details on the risks associated with lower-rated
securities.

DEPOSITARY RECEIPTS. The Fund may also invest in American, European and Global
Depositary Receipts. Depositary Receipts are certificates typically issued by a
bank or trust company that give their holders the right to receive securities
issued by a foreign or domestic corporation.

GENERAL. The Fund may invest without percentage limitation in domestic or
foreign securities. The Fund may invest up to 5% of its total assets in
securities issued by any one company or foreign government. The Fund may invest
any amount of its assets in U.S. government securities. The Fund may invest in
any industry although it will not concentrate (invest more than 25% of its total
assets) in any one industry. The Fund may invest up to 15% of its total assets
in foreign securities that are not listed on a recognized U.S. or

Templeton Growth Fund, Inc. globe 7

<PAGE>

foreign securities exchange, including up to 10% of its total assets in
securities with a limited trading market.

Please see the SAI for more details on the types of securities in which the Fund
invests.

WHAT ARE SOME OF THE FUND'S OTHER INVESTMENT STRATEGIES AND PRACTICES?

TEMPORARY INVESTMENTS. When Global Advisors believes that the securities trading
markets or the economy are experiencing excessive volatility or a prolonged
general decline, or other adverse conditions exist, it may invest the Fund's
portfolio in a temporary defensive manner. Under such circumstances, the Fund
may invest up to 100% of its assets in: (1) U.S. government securities; (2) bank
time deposits denominated in the currency of any major nation; (3) commercial
paper rated A-1 by S&P or Prime-1 by Moody's or, if unrated, issued by a company
which, at the date of investment, had an outstanding debt issue rated AAA or AA
by S&P or Aaa or Aa by Moody's; and (4) repurchase agreements with banks and
broker-dealers.

REPURCHASE AGREEMENTS. The Fund will generally have a portion of its assets in
cash or cash equivalents for a variety of reasons including waiting for a
special investment opportunity or taking a defensive position. To earn income on
this portion of its assets, the Fund may enter into repurchase agreements with
certain banks and broker-dealers. Under a repurchase agreement, the Fund agrees
to buy a U.S. government security from one of these issuers and then to sell the
security back to the issuer after a short period of time (generally, less than
seven days) at a higher price. The bank or broker-dealer must transfer to the
Fund's custodian securities with an initial value of at least 102% of the dollar
amount invested by the Fund in each repurchase agreement.

OPTIONS ON SECURITIES INDICES. The Fund may buy and sell options on securities
indices to earn additional income and/or to help protect its portfolio against
market and/or exchange rate movements, although it presently has no intention of
doing so. An option on a securities index is a contract that allows the buyer of
the option the right to receive from the seller cash, in an amount equal to the
difference between the index's closing price and the option's

8 globe Templeton Growth Fund, Inc.

<PAGE>

exercise price. The Fund may only buy options if the total premiums it paid for
such options is 5% or less of its total assets.

STOCK INDEX FUTURES CONTRACTS. Changes in interest rates, securities prices or
foreign currency valuations may affect the value of the Fund's investments. To
reduce its exposure to these factors, the Fund may buy and sell stock index
futures contracts. A stock index futures contract is an agreement to take or
make delivery of an amount of cash based on the difference between the value of
the index at the beginning and end of the contract period. Although, the Fund
may invest up to 20% of its total assets in stock index futures contracts, it
presently has no intentio of entering into these transactions.

SECURITIES LENDING. To generate additional income, the Fund may lend its
portfolio securities to qualified securities dealers or other institutional
investors. Such loans may not exceed 33 1/3% of the value of the Fund's total
assets measured at the time of the most recent loan. For each loan the Fund must
receive in return collateral with a value at least equal to 100% of the current
market value of the loaned securities.

SHORT-TERM TRADING AND PORTFOLIO TURNOVER. The Fund invests for long-term
capital growth and does not intend to emphasize short-term trading profits. It
is anticipated, therefore, that the Fund's annual portfolio turnover rate
generally will be below 50%; although this rate may be higher or lower, in
relation to market conditions. A portfolio turnover rate of less than 50% means
that in a one year period, less than one-half of the Fund's portfolio is
changed.

OTHER POLICIES AND RESTRICTIONS. The Fund has a number of additional investment
restrictions that govern its activities. Some of these restrictions may only be
changed with shareholder approval and some may be changed by the Board alone.
For a list of these restrictions and more information about the Fund's
investment policies, including those described above, and their associated
risks, please see "How Does the Fund Invest Its Assets?" and "Investment
Restrictions" in the SAI.

The policies and restrictions discussed in this prospectus and in
the SAI are applied at the time the Fund makes an investment. The Fund

Templeton Growth Fund, Inc. globe 9

<PAGE>

is generally not required to sell a security because of a change in
circumstances.

WHAT ARE THE RISKS OF INVESTING IN THE FUND?

GENERAL RISK. There is no assurance that the Fund's investment goal will be met.
The Fund will seek to spread investment risk by diversifying its investments but
the possibility of losses remains. Generally, if the securities owned by the
Fund increase in value, the value of the shares of the Fund which you own will
increase. Similarly, if the securities owned by the Fund decrease in value, the
value of your shares will also decline. In this way, you participate in any
change in the value of the securities owned by the Fund.

FOREIGN SECURITIES RISK. The value of foreign (and U.S.) securities is affected
by general economic conditions and individual company and industry earnings
prospects. While foreign securities may offer significant opportunities for
gain, they also involve additional risks that can increase the potential for
losses in the Fund. These risks can be significantly greater for investments in
emerging markets. Investments in Depositary Receipts also involve some or all of
the risks described below.

The political, economic and social structures of some countries in which the
Fund invests may be less stable and more volatile than those in the U.S. The
risks of investing in these countries include the possibility of the imposition
of exchange controls, expropriation, restrictions on removal of currency or
other assets, nationalization of assets, and punitive taxes.

There may be less publicly available information about a foreign company or
government than about a U.S. company or public entity. Certain countries'
financial markets and services are less developed than those in the U.S. or
other major economies. As a result, they may not have uniform accounting,
auditing and financial reporting standards and may have less government
supervision of financial markets. Foreign securities markets may have
substantially lower trading volumes than U.S. markets, resulting in less
liquidity and more volatility than experienced in the U.S. Transaction costs on
foreign securities markets are generally higher than in the U.S. The settlement
practices may be cumbersome and result in delays that may affect portfolio
liquidity. The Fund may have greater difficulty voting proxies, exercising

10 globe Templeton Growth Fund, Inc.

<PAGE>

shareholder rights, pursuing legal remedies and obtaining judgments with respect
to foreign investments in foreign courts than with respect to domestic issuers
in U.S. courts.

Some of the countries in which the Fund may invest such as Russia and certain
Asian and Eastern European countries are considered developing or emerging
markets. Investments in these markets are subject to all of the risks of foreign
investing generally, and have additional and heightened risks due to a lack of
legal, business and social frameworks to support securities markets.

Emerging markets involve additional significant risks, including political and
social uncertainty (for example, regional conflicts and risk of war), currency
exchange rate volatility, pervasiveness of corruption and crime, delays in
settling portfolio transactions and risk of loss arising out of the system of
share registration and custody. The Fund may invest up to 100% of its total
assets in emerging markets, including up to 5% of its total assets in Russian
securities. For more information on the risks associated with emerging markets
securities, please see the SAI.

On July 1, 1997, Hong Kong reverted to the sovereignty of China. As with any
major political transfer of power, this could result in political, social,
economic, market or other developments in Hong Kong, China or other countries
that could affect the value of Fund investments.

MARKET, CURRENCY, AND INTEREST RATE RISK. General market movements in any
country where the Fund has investments are likely to affect the value of the
securities which the Fund owns in that country and the Fund's share price may
also be affected. The Fund's investments may be denominated in foreign
currencies so that changes in foreign currency exchange rates will also affect
the value of what the Fund owns, and thus the price of its shares. To the extent
the Fund invests in debt securities, changes in interest rates in any country
where the Fund is invested will affect the value of the Fund's portfolio and,
consequently, its share price. Rising interest rates, which often occur during
times of inflation or a growing economy, are likely to cause the face value of a
debt security to decrease, having a negative effect on the value of the Fund's
shares. Of course, individual and worldwide stock markets, interest rates and
currency valuations have both increased and decreased, sometimes very
dramatically, in the past. These changes are likely to occur again in the future
at unpredictable times.

Templeton Growth Fund, Inc. globe 11

<PAGE>

CREDIT AND ISSUER RISK. The Fund's investments in debt securities involve credit
risk. This is the risk that the issuer of a debt security will be unable to make
principal and interest payments in a timely manner and the debt security will go
into default. The Fund may invest up to 10% of its total assets in defaulted
debt securities. The purchase of defaulted debt securities involves significant
additional risks, such as the possibility of complete loss of the investment in
the event the issuer does not restructure or reorganize to enable it to resume
paying interest and principal to holders.

DERIVATIVE SECURITIES RISK. Derivative investments are those whose values are
dependent upon the performance of one or more other securities or investments or
indices; in contrast to common stock, for example, whose value is dependent upon
the operations of the issuer. Options on securities indices and stock index
futures contracts are considered derivative investments. To the extent the Fund
enters into these transactions, their success will depend upon Global Advisors'
ability to predict pertinent market movements.

WHO MANAGES THE FUND?

The Board. The Board oversees the management of the Fund and elects its
officers. The officers are responsible for the Fund's day-to-day operations. The
Board also monitors the Fund to ensure no material conflicts exist among the
Fund's classes of shares. While none is expected, the Board will act
appropriately to resolve any material conflict that may arise.

Investment Manager. Global Advisors manages the Fund's assets and makes its
investment decisions. Global Advisors also performs similar services for other
funds. It is wholly owned by Resources, a publicly owned company engaged in the
financial services industry through its subsidiaries. Charles B. Johnson and
Rupert H. Johnson, Jr. are the principal shareholders of Resources. Together,
Global Advisors and its affiliates manage over $223 billion in assets. The
Templeton organization has been investing globally since 1940. Global Advisors
and its affiliates have offices in Argentina, Australia, Bahamas, Canada,
France, Germany, Hong Kong, India, Italy, Japan, Korea, Luxembourg, Poland,
Russia, Singapore, South Africa, Taiwan, United Kingdom, U.S., and Vietnam.
Please see "Investment Management and Other Services"

12 globe Templeton Growth Fund, Inc.

<PAGE>

and "Miscellaneous Information" in the SAI for information on securities
transactions and a summary of the Fund's Code of Ethics.

Portfolio Management. The Fund's lead portfolio manager since 1987 is Mark G.
Holowesko. Mr. Holowesko is president of Global Advisors. He holds a BA in
economics from Holy Cross College and an MBA from Babson College. He is a
Chartered Financial Analyst, Chartered Investment Counselor, and a founding
member of the International Society of Financial Analysts. Prior to joining the
Templeton organization in 1985, Mr. Holowesko worked with RoyWest Trust
Corporation (Bahamas) Limited as an investment analyst. His duties at RoyWest
included managing trust and individual accounts, as well as equity market
research worldwide. Mr. Holowesko is responsible for coordinating equity
research and portfolio management activities worldwide for the Templeton Global
Equity Group and managing several mutual funds.

Richard Sean Farrington and Jeffrey A. Everett have secondary portfolio
management responsibilities for the Fund. Mr. Farrington is a vice president of
Global Advisors. He holds a BA in economics from Harvard University. Mr.
Farrington is a Chartered Financial Analyst. He has served as the president of
the Bahamas Society of Financial Analysts and is currently on the board of the
International Society of Financial Analysts. He joined the Templeton
organization in 1991 and is a research analyst and portfolio manager. Mr.
Farrington's research responsibilities include global coverage of the electrical
equipment industry, as well as international electric utilities. He is also
responsible for country coverage of Hong Kong, China and Taiwan. Mr. Everett is
an executive vice president of Global Advisors. He holds a BS in finance from
Pennsylvania State University and is also a Chartered Financial Analyst. Prior
to joining the Templeton organization in 1989, Mr. Everett was an investment
officer at First Pennsylvania Investment Research, a division of First
Pennsylvania Corporation, where he analyzed equity and convertible securities.
He also coordinated research for Centre Square Investment Group, the pension
management subsidiary of First Pennsylvania Corporation. Mr. Everett is
responsible for managing several offshore accounts at Templeton, as well as
several Templeton funds. His global research responsibilities encompass industry
coverage for real estate and country coverage of Australia and Italy.

Management Fees. During the fiscal year ended August 31, 1997, management fees
totaling 0.61% of the average daily net assets of the Fund were paid to

Templeton Growth Fund, Inc. globe 13

<PAGE>

Global Advisors. Total expenses, including fees paid to Global Advisors, were
1.08% of the average daily net assets of the Fund for Class I and 1.84% for
Class II.

Portfolio Transactions. Global Advisors tries to obtain the best execution on
all transactions. If Global Advisors believes more than one broker or dealer can
provide the best execution, it may consider research and related services and
the sale of Fund shares, as well as shares of other funds in the Franklin
Templeton Group of Funds, when selecting a broker or dealer. Please see "How
Does the Fund Buy Securities for Its Portfolio?" in the SAI for more
information.

Administrative Services. Since October 1, 1996, FT Services has provided certain
administrative services and facilities for the Fund. Prior to that date,
Templeton Global Investors, Inc. provided the same services to the Fund. During
the fiscal year ended August 31, 1997, administration fees totaled 0.08% of the
average daily net assets of the Fund. These fees are included in the amount of
total expenses shown above. Please see "Investment Management and
Other Services" in the SAI for more information.

The Rule 12b-1 Plans

Class I and Class II have separate distribution plans or "Rule 12b-1 Plans"
under which they may pay or reimburse Distributors or others for the expenses of
activities that are primarily intended to sell shares of the class. These
expenses may include, among others, distribution or service fees paid to
Securities Dealers or others who have executed a servicing agreement with the
Fund, Distributors or its affiliates; a prorated portion of Distributors'
overhead expenses; and the expenses of printing prospectuses and reports used
for sales purposes, and preparing and distributing sales literature and
advertisements.

Payments by the Fund under the Class I plan may not exceed 0.25% per year of
Class I's average daily net assets. Expenses not reimbursed in any quarter may
be reimbursed in future quarters or years. This includes expenses not reimbursed
because they exceeded the applicable limit under the plan. As of August 31,
1997, there were no unreimbursed expenses under the Class I plan. During the
first year after certain Class I purchases made without a sales charge,
Distributors may keep the Rule 12b-1 fees associated with the purchase.

Under the Class II plan, the Fund may pay Distributors up to 0.75% per year of
Class II's average daily net assets to pay Distributors or others for providing
distribution and related services and bearing certain Class II expenses. All

14 globe Templeton Growth Fund, Inc.

<PAGE>

distribution expenses over this amount will be borne by those who have incurred
them. During the first year after a purchase of Class II shares, Distributors
may keep this portion of the Rule 12b-1 fees associated with the purchase.

The Fund may also pay a servicing fee of up to 0.25% per year of Class II's
average daily net assets under the Class II plan. This fee may be used to pay
Securities Dealers or others for, among other things, helping to establish and
maintain customer accounts and records, helping with requests to buy and sell
shares, receiving and answering correspondence, monitoring dividend payments
from the Fund on behalf of customers, and similar servicing and account
maintenance activities.

The Rule 12b-1 fees charged to each class are based only on the fees
attributable to that particular class. For more information, please see "The
Fund's Underwriter" in the SAI.

HOW DOES THE FUND MEASURE PERFORMANCE?

From time to time, each class of the Fund advertises its performance. A commonly
used measure of performance is total return. Performance figures are usually
calculated using the maximum sales charges, but certain figures may not include
sales charges.

Total return is the change in value of an investment over a given period. It
assumes any dividends and capital gains are reinvested.

The investment results of each class will vary. Performance figures are always
based on past performance and do not guarantee future results. For a more
detailed description of how the Fund calculates its performance figures, please
see "How Does the Fund Measure Performance?" in the SAI.

HOW TAXATION AFFECTS THE FUND AND ITS SHAREHOLDERS

ON AUGUST 5, 1997, PRESIDENT CLINTON SIGNED INTO LAW THE TAXPAYER RELIEF ACT OF
1997 (THE "1997 ACT"). THIS NEW LAW MAKES SWEEPING CHANGES IN THE CODE. BECAUSE
MANY OF THESE CHANGES ARE COMPLEX, THEY ARE DISCUSSED IN THE SAI.

Templeton Growth Fund, Inc. globe 15

<PAGE>

<TABLE>
<S> <C>
Taxation of the Fund's HOW DOES THE FUND EARN INCOME
Investments. The Fund invests AND GAINS?
your money in the stocks, bonds The Fund earns dividends and
and other securities that are interest (the Fund's "income")
described in the section "How Does on its investments. When the
the Fund Invest Its Assets?" Fund sells a security for a
Special tax rules may apply in price that is higher than it
determining the income and gains paid, it has a gain. When the
the Fund earns on its investments. Fund sells a security for a
These rules may, in turn, affect price that is lower than it
the amount of distributions that paid, it has a loss. If the
the Fund pays to you. These Fund has held the security for
special tax rules are discussed in more than one year, the gain
the SAI. or loss will be a long-term
Taxation of the Fund. As a capital gain or loss. If the
regulated investment company, the Fund has held the security for
Fund generally pays no federal one year or less, the gain or
income tax on the income and gains loss will be a short-term
that it distributes to you. capital gain or loss. The
Fund's gains and losses are
netted together, and, if the
Fund has a net gain (the
Fund's "gains"), that gain
will generally be distributed
to you.
</TABLE>

Foreign Taxes. Foreign governments may impose taxes on the income and gains from
the Fund's investments in foreign stocks and bonds. These taxes will reduce the
amount of the Fund's distributions to you. The Fund may also invest in the
securities of foreign companies that are "passive foreign investment companies"
("PFICs"). These investments in PFICs may cause the Fund to pay income taxes and
interest charges. If possible, the Fund will not invest in PFICs or will adopt
other strategies to avoid these taxes and charges.

16 globe Templeton Growth Fund, Inc.

<PAGE>

TAXATION OF SHAREHOLDERS

<TABLE>
<S> <C>
Distributions. Distributions from WHAT IS A DISTRIBUTION?
the Fund, whether you receive As a shareholder, you will
them in cash or in additional receive your share of the
shares, are generally subject to Fund's income and gains on its
income tax. The Fund will send you investments in stocks, bonds
a statement in January of the and other securities. The
current year showing the ordinary Fund's income and short-term
dividends, capital gain capital gains are paid to you
distributions and non-taxable as ordinary dividends. The
distributions you received from Fund's long-term capital gains
the Fund in the prior year. The are paid to you as capital
amounts on this statement will gain distributions. If the
include distributions declared in Fund pays you an amount in
December of the prior year, and excess of its income and
paid to you in January of the gains, this excess will
current year. These distributions generally be treated as a
are taxable as if you had received non-taxable distribution.
them on December 31 the prior These amounts, taken together,
year. The IRS requires you to are what we call the Fund's
report these amounts on your distributions to you.
income tax return for the prior
year.

</TABLE>

The Fund's statement for the prior year will tell you how much of your capital
gain distribution represents 28% rate gain, or 25% rate gain, if applicable.
The remainder of the capital gain distribution, after subtracting out these
amounts, represents 20% rate gain.

Distributions to Retirement Plans. Fund distributions received by your qualified
retirement plan, such as a Section 401(k) plan or IRA, are generally
tax-deferred; this means that you are not required to report Fund distributions
on your income tax return when paid to your plan, but, rather, when your plan
makes payments to you.

Dividends-Received Deduction. Corporate investors may be entitled to a
dividends-received deduction on a portion of the ordinary dividends received
from the Fund.

Templeton Growth Fund, Inc. globe 17

<PAGE>

<TABLE>
<S> <C>
Redemptions and Exchanges. If you WHAT IS A REDEMPTION?
redeem your shares or if you A redemption is a sale by you
exchange your shares in the Fund to the Fund of some or all of
for shares in another Franklin your shares in the Fund. The
Templeton Fund, you will generally price per share you receive
have a gain or loss that the IRS when you redeem Fund shares
requires you to report on your may be more or less than the
income tax return. If you exchange price at which you purchased
Fund shares held for 90 days or those shares. An exchange of
less and pay no sales charge, or a shares in the Fund for shares
reduced sales charge for the new of another Franklin Templeton
shares, all or a portion of the Fund is treated as a
sales charge you paid on the redemption of Fund shares and
purchase of the shares you then a purchase of shares of
exchanged is not included in their the other Fund. When you
cost for purposes of computing redeem or exchange your
gain or loss on the exchange. If shares, you will generally
you hold your shares for six have a gain or loss, depending
months or less, any loss you have upon whether the basis in your
will be treated as a long-term shares is more or less than
capital loss to the extent of any your cost or other basis in
capital gain distributions the shares. Call Fund
received by you from the Fund. All Information at 1-800-342-5236
or a portion of any loss on the for a free Shareholder Tax
redemption or exchange of Information Handbook if you
your shares will be disallowed need more information in
by the IRS if you purchase calculating the gain or loss
other shares in the Fund within on the redemption or exchange
30 days before or after your of your shares.
redemption or exchange.
</TABLE>

<TABLE>
<S> <C>
Foreign Taxes. If more than 50% of WHAT IS A FOREIGN TAX CREDIT?
the value of the Fund's assets A foreign tax credit is a tax
consists of foreign securities, the credit for the amount of taxes
Fund may elect to pass-through to imposed by a foreign country
you the amount of foreign taxes it on earnings of the Fund. When
paid. If the Fund makes this a foreign company in which the
election, your year-end statement Fund invests pays a dividend
will show more taxable income than to the Fund, the dividend will
was actually distributed to you. generally be subject to a
However, you will be entitled to withholding tax. The taxes
either deduct your share of such withheld in foreign countries
taxes in computing your taxable create credits that you may
use to offset your U.S.
federal income tax.
</TABLE>

18 globe Templeton Growth Fund, Inc.

<PAGE>

income or claim a foreign tax credit for such taxes against your U.S. federal
income tax. Your year-end statement, showing the amount of deduction or credit
available to you, will be distributed to you in January along with other
shareholder information records including your Fund Form 1099-DIV.

The 1997 Act includes a provision that allows you to claim these credits
directly on your income tax return (Form 1040) and eliminates the previous
requirement that you complete a detailed supporting form. To qualify, you must
have $600 or less in joint return foreign taxes ($300 or less on a single
return), all of which are reported to you on IRS Form 1099-DIV. THIS SIMPLIFIED
PROCEDURE APPLIES ONLY FOR CALENDAR YEARS 1998 AND BEYOND, AND IS NOT AVAILABLE
IN 1997.

Non-U.S. Investors. Ordinary dividends generally will be subject to U.S. income
tax withholding. Your home country may also tax ordinary dividends, capital gain
distributions and gains arising from redemptions or exchanges of your Fund
shares. Fund shares held by the estate of a non-U.S. investor may be subject to
U.S. estate tax. You may wish to contact your tax advisor to determine the U.S.
and non-U.S. tax consequences of your investment in the Fund.

State Taxes. Ordinary dividends and capital gain distributions that you receive
from the Fund as well as gains arising from redemptions or exchanges of your
Fund shares will generally be subject to state and local income tax. The holding
of Fund shares may also be subject to state and local intangibles taxes. You may
wish to contact your tax advisor to determine the state and local tax
consequences of your investment in the Fund.

Templeton Growth Fund, Inc. globe 19

<PAGE>

<TABLE>
<S> <C>
Backup Withholding. When you open WHAT IS A BACKUP WITHHOLDING?
an account, IRS regulations Backup withholding occurs when
require that you provide your the Fund is required to
taxpayer identification number withhold and pay over to the
("TIN"), certify that it is IRS 31% of your distributions
correct, and certify that you are and redemption proceeds. You
not subject to backup withholding can avoid backup withholding
under IRS rules. If you fail to by providing the Fund with
provide a correct TIN or the your TIN, and by completing
proper tax certifications, the the tax certifications on your
Fund is required to withhold 31% account application that you
of all the distributions were asked to sign when you
(including ordinary dividends and opened your account. However,
capital gain distributions) and if the IRS instructs the Fund
redemption proceeds paid to you. to begin backup withholding,
The Fund is also required to begin it is required to do so even
backup withholding on your account if you provided the Fund with
if the IRS instructs the Fund to your TIN and these tax
do so. The Fund reserves the right certifications, and backup
not to open your account or, withholding will remain in
alternatively, to redeem place until the Fund is
instructed by the IRS that it
is no longer required.
</TABLE>

your shares at the current net asset value, less any taxes withheld, if you fail
to provide a correct TIN, fail to provide the proper tax certifications, or the
IRS instructs the Fund to begin backup withholding on your account.

THIS TAX DISCUSSION IS FOR GENERAL INFORMATION ONLY. PROSPECTIVE INVESTORS
SHOULD CONSULT THEIR OWN TAX ADVISORS CONCERNING THE FEDERAL, STATE, LOCAL OR
FOREIGN TAX CONSEQUENCES OF AN INVESTMENT IN THE FUND. A MORE COMPLETE
DISCUSSION OF THESE RULES AND RELATED MATTERS IS CONTAINED IN THE SECTION
ENTITLED "ADDITIONAL INFORMATION ABOUT DISTRIBUTIONS AND TAXES" IN THE SAI. THE
TAX TREATMENT OF DISTRIBUTIONS OF ORDINARY DIVIDENDS, CAPITAL GAIN
DISTRIBUTIONS, FOREIGN TAXES PAID, AND INCOME TAXES WITHHELD IS ALSO DISCUSSED
IN A FREE SHAREHOLDER TAX INFORMATION HANDBOOK, AVAILABLE FROM FUND INFORMATION
AT 1-800-342-5236.

20 globe Templeton Growth Fund, Inc.

<PAGE>

HOW IS THE FUND ORGANIZED?

The Fund is a diversified, open-end management investment company, commonly
called a mutual fund. It was organized as a Maryland corporation on November 10,
1986 from its predecessor entity which commenced operations on November 29,
1954, and is registered with the SEC. As of January 1, 1997, the Fund began
offering a new class of shares designated Templeton Growth Fund, Inc. - Advisor
Class. All shares outstanding before the offering of Advisor Class shares have
been designated Templeton Growth Fund, Inc. - Class I and Templeton Growth Fund,
Inc. - Class II. Additional classes of shares may be offered in the future.

Shares of each class represent proportionate interests in the assets of the Fund
and have the same voting and other rights and preferences as any other class of
the Fund for matters that affect the Fund as a whole. For matters that only
affect one class, however, only shareholders of that class may vote. Each class
will vote separately on matters affecting only that class, or expressly required
to be voted on separately by state or federal law.

The Fund has noncumulative voting rights. This gives holders of more than 50% of
the shares voting the ability to elect all of the members of the Board. If this
happens, holders of the remaining shares voting will not be able to elect anyone
to the Board.

The Fund does not intend to hold annual shareholder meetings. It may hold
special meetings, however, for matters requiring shareholder approval. A meeting
may also be called by the Board in its discretion or for the purpose of
considering the removal of a Board member if requested in writing to do so by
shareholders holding at least 10% of the outstanding shares. In certain
circumstances, we are required to help you communicate with other shareholders
about the removal of a Board member.

Templeton Growth Fund, Inc. globe 21

<PAGE>

ABOUT YOUR ACCOUNT

HOW DO I BUY SHARES?

Opening Your Account

To open your account, contact your investment representative or complete and
sign the enclosed shareholder application and return it to the Fund with your
check. PLEASE INDICATE WHICH CLASS OF SHARES YOU WANT TO BUY. IF YOU DO NOT
SPECIFY A CLASS, YOUR PURCHASE WILL BE AUTOMATICALLY INVESTED IN CLASS I SHARES.

<TABLE>
<CAPTION>
MINIMUM
INVESTMENTS*
<S> <C>
- --------------------------------------
To Open Your Account.... $100
To Add to Your
Account............... $ 25
</TABLE>

*We may waive these minimums for retirement plans. We may also refuse any order
to buy shares.

Choosing a Share Class

Each class has its own sales charge and expense structure, allowing you to
choose the class that best meets your situation. The class that may be best for
you depends on a number of factors, including the amount and length of time you
expect to invest. Generally, Class I shares may be more attractive for long-term
investors or investors who qualify to buy Class I shares at a reduced sales
charge. Your financial representative can help you decide.

CLASS I

- - Higher front-end sales charges than Class II shares. There are several ways to
reduce these charges, as described below. There is no front-end sales charge
for purchases of $1 million or more.*

- - Contingent Deferred Sales Charge on purchases of $1 million or more sold
within one year

- - Lower annual expenses than Class II shares

CLASS II

- - Lower front-end sales charges than Class I shares

- - Contingent Deferred Sales Charge on purchases sold within 18 months

- - Higher annual expenses than Class I shares

*If you are investing $1 million or more, it is generally more beneficial for
you to buy Class I shares because there is no front-end sales charge and the
annual expenses are lower. Therefore, ANY PURCHASE OF $1 MILLION OR MORE IS
AUTOMATICALLY INVESTED IN CLASS I SHARES. You may accumulate more than $1
million in Class II shares through purchases over time. If you plan to do this,
however, you should determine if it would be better for you to buy Class I
shares through a Letter of Intent.

22 globe Templeton Growth Fund, Inc.

<PAGE>

Purchase Price of Fund Shares

For Class I shares, the sales charge you pay depends on the dollar amount you
invest, as shown in the table below. The sales charge for Class II shares is 1%
and, unlike Class I, does not vary based on the size of your purchase.

<TABLE>
<CAPTION>
TOTAL SALES CHARGE
AS A PERCENTAGE OF AMOUNT PAID
-------------------- TO DEALER AS A
AMOUNT OF PURCHASE OFFERING NET AMOUNT PERCENTAGE OF
AT OFFERING PRICE PRICE INVESTED OFFERING PRICE
<S> <C> <C> <C>
- --------------------------------------------------------------------------
CLASS I
Under $50,000..................... 5.75% 6.10% 5.00%
$50,000 but less than $100,000.... 4.50% 4.71% 3.75%
$100,000 but less than $250,000... 3.50% 3.63% 2.80%
$250,000 but less than $500,000... 2.50% 2.56% 2.00%
$500,000 but less than
$1,000,000...................... 2.00% 2.04% 1.60%
$1,000,000 or more*............... None None None
CLASS II
Under $1,000,000*................. 1.00% 1.01% 1.00%
</TABLE>

*A Contingent Deferred Sales Charge of 1% may apply to Class I purchases of $1
million or more and any Class II purchase. 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. Purchases of
Class II shares are limited to purchases below $1 million. Please see "Choosing
a Share Class."

Sales Charge Reductions and Waivers

IF YOU QUALIFY TO BUY SHARES UNDER ONE OF THE SALES CHARGE REDUCTION OR WAIVER
CATEGORIES DESCRIBED BELOW, PLEASE INCLUDE A WRITTEN STATEMENT WITH EACH
PURCHASE ORDER EXPLAINING WHICH PRIVILEGE APPLIES. If you don't include this
statement, we cannot guarantee that you will receive the sales charge
reduction or waiver.

Cumulative Quantity Discounts - Class I Only. To determine if you may pay a
reduced sales charge, the amount of your current Class I purchase is added to
the cost or current value, whichever is higher, of your existing shares in the
Franklin Templeton Funds, as well as those of your spouse, children under the
age of 21 and grandchildren under the age of 21. If you are the sole owner of a
company, you may also add any company accounts, including retirement plan
accounts. Companies with one or more retirement plans may add together the total
plan assets invested in the Franklin Templeton Funds to determine the sales
charge that applies.

Templeton Growth Fund, Inc. globe 23

<PAGE>

Letter of Intent - Class I Only. You may buy Class I shares at a reduced sales
charge by completing the Letter of Intent section of the shareholder
application. A Letter of Intent is a commitment by you to invest a specified
dollar amount during a 13 month period. The amount you agree to invest
determines the sales charge you pay on Class I shares.

BY COMPLETING THE LETTER OF INTENT SECTION OF THE SHAREHOLDER APPLICATION, YOU
ACKNOWLEDGE AND AGREE TO THE FOLLOWING:

- - You authorize Distributors to reserve 5% of your total intended purchase in
Class I shares registered in your name until you fulfill your Letter.

- - You give Distributors a security interest in the reserved shares and appoint
Distributors as attorney-in-fact.

- - Distributors may sell any or all of the reserved shares to cover any
additional sales charge if you do not fulfill the terms of the Letter.

- - Although you may exchange your shares, you may not sell reserved shares until
you complete the Letter or pay the higher sales charge.

Your periodic statements will include the reserved shares in the total shares
you own. We will pay or reinvest dividend and capital gain distributions on the
reserved shares as you direct. Our policy of reserving shares does not apply to
certain retirement plans.

If you would like more information about the Letter of Intent privilege, please
see "How Do I Buy, Sell and Exchange Shares? - Letter of Intent" in the SAI or
call Shareholder Services.

Group Purchases - Class I Only. If you are a member of a qualified group, you
may buy Class I shares at a reduced sales charge that applies to the group as a
whole. The sales charge is based on the combined dollar value of the group
members' existing investments, plus the amount of the current purchase.

A qualified group is one that:

- - Was formed at least six months ago,

- - Has a purpose other than buying Fund shares at a discount,

- - Has more than 10 members,

- - Can arrange for meetings between our representatives and group members,

24 globe Templeton Growth Fund, Inc.

<PAGE>

- - Agrees to include Franklin Templeton Fund sales and other materials in
publications and mailings to its members at reduced or no cost to
Distributors,

- - Agrees to arrange for payroll deduction or other bulk transmission of
investments to the Fund, and

- - Meets other uniform criteria that allow Distributors to achieve cost savings
in distributing shares.

Sales Charge Waivers. If one of the following sales charge waivers applies to
you or your purchase of Fund shares, you may buy shares of the Fund without a
front-end sales charge or a Contingent Deferred Sales Charge. All of the sales
charge waivers listed below apply to purchases of Class I shares only, except
for items 1 and 2 which also apply to Class II purchases.

Certain distributions, payments or redemption proceeds that you receive may be
used to buy shares of the Fund without a sales charge if you reinvest them
within 365 days of their payment or redemption date. They include:

1. Dividend and capital gain distributions from any Franklin Templeton Fund.
The distributions generally must be reinvested in the same class of shares.
Certain exceptions apply, however, to Class II shareholders who chose to
reinvest their distributions in Class I shares of the Fund before November
17, 1997, and to Advisor Class or Class Z shareholders of a Franklin
Templeton Fund who may reinvest their distributions in Class I shares of the
Fund.

2. Redemption proceeds from the sale of shares of any Franklin Templeton Fund
if you originally paid a sales charge on the shares and you reinvest the
money in the same class of shares. This waiver does not apply to exchanges.

If you paid a Contingent Deferred Sales Charge when you redeemed your shares
from a Franklin Templeton 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
redemption proceeds that you reinvest.

If you immediately placed your redemption proceeds in a Franklin Bank CD,
you may reinvest them as described above. The proceeds must be

Templeton Growth Fund, Inc. globe 25

<PAGE>

reinvested within 365 days from the date the CD matures, including any rollover.

3. Dividend or capital gain distributions from a real estate investment trust
(REIT) sponsored or advised by Franklin Properties, Inc.

4. Annuity payments received under either an annuity option or from death
benefit proceeds, only if the annuity contract offers as an investment
option the Franklin Valuemark Funds, the Templeton Variable Annuity Fund, or
the Templeton Variable Products Series Fund. You should contact your tax
advisor for information on any tax consequences that may apply.

5. Distributions from an existing retirement plan invested in the Franklin
Templeton Funds.

6. 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.

Various individuals and institutions also may buy Class I shares without a
front-end sales charge or Contingent Deferred Sales Charge, including:

1. Trust companies and bank trust departments agreeing to invest in Franklin
Templeton Funds over a 13 month period at least $1 million of assets held in
a fiduciary, agency, advisory, custodial or similar capacity and over which
the trust companies and bank trust departments or other plan fiduciaries or
participants, in the case of certain retirement plans, have full or shared
investment discretion. We will accept orders for these accounts by mail
accompanied by a check or by telephone or other means of electronic data
transfer directly from the bank or trust company,

26 globe Templeton Growth Fund, Inc.

<PAGE>

with payment by federal funds received by the close of business on the next
business day following the order.

2. An Eligible Governmental Authority. Please consult your legal and investment
advisors to determine if an investment in the Fund is permissible and
suitable for you and the effect, if any, of payments by the Fund on
arbitrage rebate calculations.

3. Broker-dealers, registered investment advisors or certified financial
planners who have entered into an agreement with Distributors for clients
participating in comprehensive fee programs

4. Registered Securities Dealers and their affiliates, for their investment
accounts only

5. Current employees of Securities Dealers and their affiliates and their
family members, as allowed by the internal policies of their employer

6. 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

7. Investment companies exchanging shares or selling assets pursuant to a
merger, acquisition or exchange offer

8. Accounts managed by the Franklin Templeton Group

9. Certain unit investment trusts and their holders reinvesting distributions
from the trusts

10. Group annuity separate accounts offered to retirement plans

11. Chilean retirement plans that meet the requirements described under
"Retirement Plans" below

12. German insurance companies that publicly offer variable annuities or unit
linked life policies in Germany and that have entered into an agreement with
Templeton Global Strategic Services (Deutschland) GmbH

Retirement Plans. Retirement plans that (i) are sponsored by an employer with at
least 100 employees, or (ii) have plan assets of $1 million or more, or (iii)
agree to invest at least $500,000 in the Franklin Templeton Funds over a 13
month period may buy Class I shares without a front-end sales charge. Retirement
plans that are not Qualified Retirement Plans or SEPs, such as 403(b) or 457
plans, must also meet the requirements described under

Templeton Growth Fund, Inc. globe 27

<PAGE>

"Group Purchases - Class I Only" above to be able to buy Class I shares without
a front-end sales charge. For retirement plan accounts opened on or after May 1,
1997, a Contingent Deferred Sales Charge may apply if the account is closed
within 365 days of the retirement plan account's initial purchase in the
Franklin Templeton Funds. Please see "How Do I Sell Shares? - Contingent
Deferred Sales Charge" for details.

Any retirement plan that does not meet the requirements to buy Class I shares
without a front-end sales charge and that was a shareholder of the Fund on or
before February 1, 1995, may buy shares of the Fund subject to a maximum sales
charge of 4% of the Offering Price, 3.2% of which will be retained by Securities
Dealers.

How Do I Buy Shares in Connection with Retirement Plans?

Your individual or employer-sponsored retirement plan may invest in the Fund.
Plan documents are required for all retirement plans. Trust Company can provide
the plan documents for you and serve as custodian or trustee.

Trust Company can provide you with brochures containing important information
about its plans. To establish a Trust Company retirement plan, you will need an
application other than the one included in this prospectus. For a retirement
plan brochure or application, call Retirement Plan Services.

Please consult your legal, tax or retirement plan specialist before choosing a
retirement plan. Your investment representative or advisor can help you make
investment decisions within your plan.

Other Payments to Securities Dealers

The payments described below may be made to Securities Dealers who initiate and
are responsible for Class II purchases and certain Class I purchases made
without a sales charge. The payments are subject to the sole discretion of
Distributors, and are paid by Distributors or one of its affiliates and not by
the Fund or its shareholders.

1. Class II purchases - up to 1% of the purchase price.

2. Class I purchases of $1 million or more - up to 1% of the amount invested.

28 globe Templeton Growth Fund, Inc.

<PAGE>

3. Class I purchases made without a front-end sales charge by certain retirement
plans described under "Sales Charge Reductions and Waivers - Retirement
Plans" above - up to 1% of the amount invested.

4. Class I purchases by trust companies and bank trust departments, Eligible
Governmental Authorities, and broker-dealers or others on behalf of clients
participating in comprehensive fee programs - up to 0.25% of the amount
invested.

5. Class I purchases by Chilean retirement plans - up to 1% of the amount
invested.

A Securities Dealer may receive only one of these payments for each qualifying
purchase. Securities Dealers who receive payments in connection with investments
described in paragraphs 1, 2 or 5 above or a payment of up to 1% for investments
described in paragraph 3 will be eligible to receive the Rule 12b-1 fee
associated with the purchase starting in the thirteenth calendar month after the
purchase.

FOR BREAKPOINTS THAT MAY APPLY AND INFORMATION ON ADDITIONAL COMPENSATION
PAYABLE TO SECURITIES DEALERS IN CONNECTION WITH THE SALE OF FUND SHARES, PLEASE
SEE "HOW DO I BUY, SELL AND EXCHANGE SHARES? - OTHER PAYMENTS TO SECURITIES
DEALERS" IN THE SAI.

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.

MAY I EXCHANGE SHARES FOR SHARES OF ANOTHER FUND?

We offer a wide variety of funds. If you would like, you can move your
investment from your Fund account to an existing or new account in another
Franklin Templeton Fund (an "exchange"). Because it is technically a sale and a
purchase of shares, an exchange is a taxable transaction.

Templeton Growth Fund, Inc. globe 29

<PAGE>

If you own Class I shares, you may exchange into any of our money funds except
Franklin Templeton Money Fund II ("Money Fund II"). Money Fund II is the only
money fund exchange option available to Class II shareholders. Unlike our other
money funds, shares of Money Fund II may not be purchased directly and no drafts
(checks) may be written on Money Fund II accounts.

Before making an exchange, please read the prospectus of the fund you are
interested in. This will help you learn about the fund, its investment objective
and policies, and its rules and requirements for exchanges. For example, some
Franklin Templeton Funds do not accept exchanges and others may have different
investment minimums. Some Franklin Templeton Funds do not offer Class II shares.

<TABLE>
<CAPTION>
METHOD STEPS TO FOLLOW
- -------------------------------------------------------------------
<S> <C>
BY MAIL 1. Send us signed written instructions
2. Include any outstanding share certificates
for the shares you want to exchange
- -------------------------------------------------------------------

BY PHONE Call Shareholder Services or TeleFACTS(R)
] If you do not want the ability to exchange
by phone to apply to your account, please let
us know.
- -------------------------------------------------------------------
THROUGH YOUR DEALER Call your investment representative
- -------------------------------------------------------------------
</TABLE>

Please refer to "Transaction Procedures and Special Requirements" for other
important information on how to exchange shares.

Will Sales Charges Apply to My Exchange?

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 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.

We will not impose a Contingent Deferred Sales Charge when you exchange shares.
Any shares subject to a Contingent Deferred Sales Charge at the time

30 globe Templeton Growth Fund, Inc.

<PAGE>

of exchange, however, will remain so in the new fund. See the discussion on
Contingent Deferred Sales Charges below and under "How Do I Sell Shares?"

Contingent Deferred Sales Charge - Class I. For accounts with Class I shares
subject to a Contingent Deferred Sales Charge, shares are exchanged into the new
fund in the order they were purchased. If you exchange Class I shares into one
of our money funds, the time your shares are held in that fund will not count
towards the completion of any Contingency Period.

Contingent Deferred Sales Charge - Class II. For accounts with Class II shares
subject to a Contingent Deferred Sales Charge, shares are exchanged into the new
fund proportionately based on the amount of shares subject to a Contingent
Deferred Sales Charge and the length of time the shares have been held. For
example, suppose you own $1,000 in shares that have never been subject to a
Contingent Deferred Sales Charge, such as shares from the reinvestment of
dividends and capital gains ("free shares"), $2,000 in shares that are no longer
subject to a Contingent Deferred Sales Charge because you have held them for
longer than 18 months ("matured shares"), and $3,000 in shares that are still
subject to a Contingent Deferred Sales Charge ("CDSC liable shares"). If you
exchange $3,000 into a new fund, $500 will be exchanged from free shares, $1,000
from matured shares, and $1,500 from CDSC liable shares.

Likewise, CDSC liable shares purchased at different times will be exchanged into
a new fund proportionately. For example, assume you purchased $1,000 in shares 3
months ago, 6 months ago, and 9 months ago. If you exchange $1,500 into a new
fund, $500 will be exchanged from shares purchased at each of these three
different times.

While Class II shares are exchanged proportionately, they are redeemed in the
order purchased. In some cases, this means exchanged shares may be CDSC liable
even though they would not be subject to a Contingent Deferred Sales Charge if
they were sold. The tax consequences of a sale or exchange are determined by the
Code and not by the method used by the Fund to transfer shares.

If you exchange your Class II shares for shares of Money Fund II, the time your
shares are held in that fund will count towards the completion of any
Contingency Period.

Exchange Restrictions

Please be aware that the following restrictions apply to exchanges:

- - You may only exchange shares within the SAME CLASS, except as noted below.

- - The accounts must be identically registered. You may, however, exchange shares
from a Fund account requiring two or more signatures into an identically
registered money fund account requiring only one signature for all
transactions. Please notify us in writing if you do not want this option to be
available on your account. Additional procedures may apply. Please see
"Transaction Procedures and Special Requirements."

- - Trust Company IRA or 403(b) retirement plan accounts may exchange shares as
described above. Restrictions may apply to other types of retirement plans.
Please contact Retirement Plan Services for information on exchanges within
these plans.

- - The fund you are exchanging into must be eligible for sale in your state.

- - We may modify or discontinue our exchange policy if we give you 60 days'
written notice.

- - Your exchange may be restricted or refused if you have: (i) requested an
exchange out of the Fund within two weeks of an earlier exchange request, (ii)
exchanged shares out of the Fund more than twice in a calendar quarter, or
(iii) exchanged shares equal to at least $5 million, or more than 1% of the
Fund's net assets. Shares under common ownership or control

Templeton Growth Fund, Inc. globe 31
<PAGE>

are combined for these limits. If you have exchanged shares as described in
this paragraph, you will be considered a Market Timer. Each exchange by a
Market Timer, if accepted, will be charged $5.00. Some of our funds do not
allow investments by Market Timers.

Because excessive trading can hurt Fund performance, operations and
shareholders, we may refuse any exchange purchase if (i) we believe 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.

Limited Exchanges Between Different Classes of Shares

The Fund offers a class of shares designated "Advisor Class," which is described
in a separate prospectus. If you do not qualify to buy Advisor Class shares of
the Fund, but you own Advisor Class shares of another Franklin Templeton Fund,
you may exchange those Advisor Class shares for Class I shares of the Fund at
Net Asset Value. If you do so and you later decide you would like to exchange
into a fund that offers an Advisor Class, you may exchange your Class I shares
for Advisor Class shares of that fund. Certain shareholders of Class Z shares of
Franklin Mutual Series Fund Inc. may also exchange their Class Z shares for
Class I shares of the Fund at Net Asset Value.

32 globe Templeton Growth Fund, Inc.

<PAGE>

HOW DO I SELL SHARES?

You may sell (redeem) your shares at any time.

<TABLE>
<CAPTION>
METHOD STEPS TO FOLLOW
- -------------------------------------------------------------------
<S> <C>
BY MAIL 1. Send us signed written instructions. If
you would like your redemption proceeds wired
to a bank account, your instructions
should include:
- The name, address and telephone number of
the bank where you want the proceeds sent
- Your bank account number
- The Federal Reserve ABA routing number
- If you are using a savings and loan or
credit union, the name of the corresponding
bank and the account number
2. Include any outstanding share certificates
for the shares you are selling
3. Provide a signature guarantee if required
4. Corporate, partnership and trust accounts
may need to send additional documents.
Accounts under court jurisdiction may have
other requirements.
- -------------------------------------------------------------------
</TABLE>

Templeton Growth Fund, Inc. globe 33

<PAGE>

<TABLE>
<CAPTION>
METHOD STEPS TO FOLLOW
- -------------------------------------------------------------------
<S> <C>
BY PHONE Call Shareholder Services. If you would like
your redemption proceeds wired to a bank
account, other than an escrow account, you
must first sign up for the wire feature. To
sign up, send us written instructions, with a
signature guarantee. To avoid any delay in
processing, the instructions should include
the items listed in "By Mail" above.
Telephone requests will be accepted:
- If the request is $50,000 or less.
Institutional accounts may exceed $50,000 by
completing a separate agreement. Call
Institutional Services to receive a copy.
- If there are no share certificates issued
for the shares you want to sell or you have
already returned them to the Fund
- Unless you are selling shares in a Trust
Company retirement plan account
- Unless the address on your account was
changed by phone within the last 15 days

] If you do not want the ability to redeem by
phone to apply to your account, please let us
know.
- -------------------------------------------------------------------
THROUGH YOUR DEALER Call your investment representative
- -------------------------------------------------------------------
</TABLE>

We will send your redemption check within seven days after we receive your
request in proper form. If you would like the check sent to an address other
than the address of record or made payable to someone other than the registered
owners on the account, send us written instructions signed by all account
owners, with a signature guarantee. We are not able to receive or pay out cash
in the form of currency.

The wiring of redemption proceeds is a special service that we make available
whenever possible for redemption requests of $1,000 or more. If we receive your
request in proper form before 4:00 p.m. Eastern time, your wire payment will be
sent the next business day. For requests received in proper form after 4:00 p.m.
Eastern time, the payment will be sent the second business day. By offering this
service to you, the Fund is not bound to meet any redemption request in less
than the seven day period prescribed by law. Neither the Fund nor its agents
shall be liable to you or any other person if,

34 globe Templeton Growth Fund, Inc.

<PAGE>

for any reason, a redemption request by wire is not processed as described in
this section.

If you sell shares you recently purchased with a check or draft, we may delay
sending you the proceeds for up to 15 days or more to allow the check or draft
to clear. A certified or cashier's check may clear in less time.

Under unusual circumstances, we may suspend redemptions or postpone payment for
more than seven days as permitted by federal securities law.

Please refer to "Transaction Procedures and Special Requirements" for other
important information on how to sell shares.

Trust Company Retirement Plan Accounts

To comply with IRS regulations, you need to complete additional forms before
selling shares in a Trust Company retirement plan account. Tax penalties
generally apply to any distribution from these plans to a participant under age
59 1/2, unless the distribution meets an exception stated in the Code. To obtain
the necessary forms, please call Retirement Plan Services.

Contingent Deferred Sales Charge

For Class I purchases, if you did not pay a front-end sales charge because you
invested $1 million or more or agreed to invest $1 million or more under a
Letter of Intent, a Contingent Deferred Sales Charge may apply if you sell all
or a part of your investment within the Contingency Period. Once you have
invested $1 million or more, any additional Class I investments you make without
a sales charge may also be subject to a Contingent Deferred Sales Charge if they
are sold within the Contingency Period. For any Class II purchase, a Contingent
Deferred Sales Charge may apply if you sell the shares within the Contingency
Period. The charge is 1% of the value of the shares sold or the Net Asset Value
at the time of purchase, whichever is less.

Certain retirement plan accounts opened on or after May 1, 1997, and that
qualify to buy Class I shares without a front-end sales charge may also be
subject to a Contingent Deferred Sales Charge if the retirement plan account is
closed within 365 days of the account's initial purchase in the Franklin
Templeton Funds.

We will first redeem any shares in your account that are not subject to the
charge. If there are not enough of these to meet your request, we will redeem
shares subject to the charge in the order they were purchased.

Templeton Growth Fund, Inc. globe 35

<PAGE>

Unless otherwise specified, when you request to sell a stated DOLLAR AMOUNT, we
will redeem additional shares to cover any Contingent Deferred Sales Charge. For
requests to sell a stated NUMBER OF SHARES, we will deduct the amount of the
Contingent Deferred Sales Charge, if any, from the sale proceeds.

Waivers. We waive the Contingent Deferred Sales Charge for:

- - Account fees

- - Sales of shares purchased without a front-end sales charge by certain
retirement plan accounts if (i) the account was opened before May 1, 1997, or
(ii) the Securities Dealer of record received a payment from Distributors of
0.25% or less, or (iii) Distributors did not make any payment in connection
with the purchase, or (iv) the Securities Dealer of record has entered into a
supplemental agreement with Distributors

- - Redemptions by the Fund when an account falls below the minimum required
account size

- - Redemptions following the death of the shareholder or beneficial owner

- - Redemptions through a systematic withdrawal plan set up before
February 1, 1995

- - Redemptions through a systematic withdrawal plan set up on or after February
1, 1995, at a rate of up to 1% a month of an account's Net Asset Value. For
example, if you maintain an annual balance of $1 million in Class I shares,
you can redeem up to $120,000 annually through a systematic withdrawal plan
free of charge. Likewise, if you maintain an annual balance of $10,000 in
Class II shares, $1,200 may be redeemed annually free of charge.

- - Distributions from individual retirement plan accounts due to death or
disability or upon periodic distributions based on life expectancy

- - Tax-free returns of excess contributions from employee benefit plans

- - Redemptions by Trust Company employee benefit plans or employee benefit plans
serviced by ValuSelect(R)

- - Participant initiated distributions from employee benefit plans or participant
initiated exchanges among investment choices in employee benefit plans

36 globe Templeton Growth Fund, Inc.

<PAGE>

WHAT DISTRIBUTIONS MIGHT I RECEIVE FROM THE FUND?

The Fund intends to pay a dividend at least annually representing substantially
all of its net investment income and any net realized capital gains.

Dividends and capital gains are calculated and distributed the same way for each
class. The amount of any income dividends per share will differ, however,
generally due to the difference in the Rule 12b-1 fees of Class I and Class II.

Dividend payments are not guaranteed, are subject to the Board's discretion and
may vary with each payment. THE FUND DOES NOT PAY "INTEREST" OR GUARANTEE ANY
FIXED RATE OF RETURN ON AN INVESTMENT IN ITS SHARES.

If you buy shares shortly before the record date, please keep in mind that any
distribution will lower the value of the Fund's shares by the amount of the
distribution and you will then receive a portion of the price you paid back in
the form of a taxable distribution.

Distribution Options

You may receive your distributions from the Fund in any of these ways:

1. Buy additional shares of the Fund - You may buy additional shares of the Fund
(without a sales charge or imposition of a Contingent Deferred Sales Charge) by
reinvesting capital gain distributions, dividend distributions, or both. This is
a convenient way to accumulate additional shares and maintain or increase your
earnings base.

2. Buy shares of other Franklin Templeton Funds - You may direct your
distributions to buy shares of another Franklin Templeton Fund (without a sales
charge or imposition of a Contingent Deferred Sales Charge). Many shareholders
find this a convenient way to diversify their investments.

3. Receive distributions in cash - You may receive capital gain distributions,
dividend distributions, or both in cash. If you have the money sent to another
person or to a checking account, you may need a signature guarantee.

Distributions may be reinvested only in the same class of shares, except as
follows: (i) Class II shareholders who chose to reinvest their distributions in
Class I shares of the Fund or another Franklin Templeton Fund before November
17, 1997, may continue to do so; and (ii) Class II shareholders

Templeton Growth Fund, Inc. globe 37

<PAGE>

may reinvest their distributions in shares of any Franklin Templeton money fund.

TO SELECT ONE OF THESE OPTIONS, PLEASE COMPLETE SECTIONS 6 AND 7 OF THE
SHAREHOLDER APPLICATION INCLUDED WITH THIS PROSPECTUS OR TELL YOUR INVESTMENT
REPRESENTATIVE WHICH OPTION YOU PREFER. IF YOU DO NOT SELECT AN OPTION, WE WILL
AUTOMATICALLY REINVEST DIVIDEND AND CAPITAL GAIN DISTRIBUTIONS IN THE SAME CLASS
OF THE FUND. You may change your distribution option at any time by notifying us
by mail or phone. Please allow at least seven days before the record date for us
to process the new option. For Trust Company retirement plans, special forms are
required to receive distributions in cash.

TRANSACTION PROCEDURES AND SPECIAL REQUIREMENTS

Share Price

When you buy shares, you pay the Offering Price. This is the Net Asset Value per
share of the class you wish to purchase, plus any applicable sales charges. When
you sell shares, you receive the Net Asset Value per share minus any applicable
Contingent Deferred Sales Charges.

The Net Asset Value we use when you buy or sell shares is the one next
calculated after we receive your transaction request in proper form. If you buy
or sell shares through your Securities Dealer, however, we will use the Net
Asset Value next calculated after your Securities Dealer receives your request,
which is promptly transmitted to the Fund. Your redemption proceeds will not
earn interest between the time we receive the order from your dealer and the
time we receive any required documents.

How and When Shares are Priced

The Fund is open for business each day the NYSE is open. We determine the Net
Asset Value per share of each class as of the scheduled close of the NYSE,
generally 4:00 p.m. Eastern time. You can find the prior day's closing Net Asset
Value and Offering Price for each class in many newspapers.

The Net Asset Value of all outstanding shares of each class is calculated on a
pro rata basis. It is based on each class' proportionate participation in the
Fund, determined by the value of the shares of each class. Each class, however,
bears the Rule 12b-1 fees payable under its Rule 12b-1 plan. To calculate Net
Asset Value per share of each class, the assets of each class are

38 globe Templeton Growth Fund, Inc.

<PAGE>

valued and totaled, liabilities are subtracted, and the balance, called net
assets, is divided by the number of shares of the class outstanding. The Fund's
assets are valued as described under "How Are Fund Shares Valued?" in the SAI.

Proper Form

An order to buy shares is in proper form when we receive your signed shareholder
application and check. Written requests to sell or exchange shares are in proper
form when we receive signed written instructions, with a signature guarantee if
necessary. We must also receive any outstanding share certificates for those
shares.

Written Instructions

Written instructions must be signed by all registered owners. To avoid any delay
in processing your transaction, they should include:

- - Your name,

- - The Fund's name,

- - The class of shares,

- - A description of the request,

- - For exchanges, the name of the fund you are exchanging into,

- - Your account number,

- - The dollar amount or number of shares, and

- - A telephone number where we may reach you during the day, or in the evening if
preferred.

Joint Accounts. For accounts with more than one registered owner, we accept
written instructions signed by only one owner for certain types of transactions
or account changes. These include transactions or account changes that you could
also make by phone, such as certain redemptions of $50,000 or less, exchanges
between identically registered accounts, and changes to the address of record.
For most other types of transactions or changes, written instructions must be
signed by all registered owners.

Please keep in mind that if you have previously told us that you do not want
telephone exchange or redemption privileges on your account, then we can

Templeton Growth Fund, Inc. globe 39

<PAGE>

only accept written instructions to exchange or redeem shares if they are signed
by all registered owners on the account.

Signature Guarantees

For our mutual protection, we require a signature guarantee in the following
situations:

1) You wish to sell over $50,000 worth of shares,

2) You want the proceeds to be paid to someone other than the registered owners,

3) The proceeds are not being sent to the address of record, preauthorized bank
account, or preauthorized brokerage firm account,

4) We receive instructions from an agent, not the registered owners,

5) We believe a signature guarantee would protect us against potential claims
based on the instructions received.

A signature guarantee verifies the authenticity of your signature. You should be
able to obtain a signature guarantee from a bank, broker, credit union, savings
association, clearing agency, or securities exchange or association. A NOTARIZED
SIGNATURE IS NOT SUFFICIENT.

Share Certificates

We will credit your shares to your Fund account. We do not issue share
certificates unless you specifically request them. This eliminates the costly
problem of replacing lost, stolen or destroyed certificates. If a certificate is
lost, stolen or destroyed, you may have to pay an insurance premium of up to 2%
of the value of the certificate to replace it.

Any outstanding share certificates must be returned to the Fund if you want to
sell or exchange those shares or if you would like to start a systematic
withdrawal plan. The certificates should be properly endorsed. You can do this
either by signing the back of the certificate or by completing a share
assignment form. For your protection, you may prefer to complete a share
assignment form and to send the certificate and assignment form in separate
envelopes.

40 globe Templeton Growth Fund, Inc.

<PAGE>

Telephone Transactions

You may initiate many transactions and changes to your account by phone. Please
refer to the sections of this prospectus that discuss the transaction you would
like to make or call Shareholder Services.

When you call, we will request personal or other identifying information to
confirm that instructions are genuine. We may also record calls. If our lines
are busy or you are otherwise unable to reach us by phone, you may wish to ask
your investment representative for assistance or send us written instructions,
as described elsewhere in this prospectus.

For your protection, we may delay a transaction or not implement one if we are
not reasonably satisfied that the instructions are genuine. If this occurs, we
will not be liable for any loss. We also will not be liable for any loss if we
follow instructions by phone that we reasonably believe are genuine or if you
are unable to execute a transaction by phone.

Trust Company Retirement Plan Accounts. We cannot accept instructions to sell
shares or change distribution options on Trust Company retirement plans by
phone. While you may exchange shares of Trust Company IRA and 403(b) retirement
accounts by phone, certain restrictions may be imposed on other retirement
plans.

To obtain any required forms or more information about distribution or transfer
procedures, please call Retirement Plan Services.

Account Registrations and Required Documents

When you open an account, we need you to tell us how you want your shares
registered. How you register your account will affect your ownership rights and
ability to make certain transactions. If you have questions about how to
register your account, you should consult your investment representative or
legal advisor. Please keep the following information in mind when registering
your account.

Joint Ownership. If you open an account with two or more owners, we register the
account as "joint tenants with rights of survivorship" unless you tell us
otherwise. An account registered as "joint tenants with rights of survivorship"
is shown as "Jt Ten" on your account statement. For any account with two or more
owners, we cannot accept instructions to change owners on the account unless all
owners agree in writing, even if the law in your state says

Templeton Growth Fund, Inc. globe 41

<PAGE>

otherwise. If you would like another person or owner to sign for you, please
send us a current power of attorney.

Gifts and Transfers to Minors. You may set up a custodial account for a minor
under your state's Uniform Gifts/Transfers to Minors Act. Other than this form
of registration, a minor may not be named as an account owner.

Trusts. You should register your account as a trust only if you have a valid
written trust document. This avoids future disputes or possible court action
over who owns the account.

Required Documents. For corporate, partnership and trust accounts, please send
us the following documents when you open your account. This will help avoid
delays in processing your transactions while we verify who may sign on the
account.

<TABLE>
<CAPTION>
TYPE OF ACCOUNT DOCUMENTS REQUIRED
- ------------------------------------------------------------------
<S> <C>
CORPORATION Corporate Resolution
- ------------------------------------------------------------------
PARTNERSHIP 1. The pages from the partnership agreement
that identify the general partners, or
2. A certification for a partnership
agreement
- ------------------------------------------------------------------
TRUST 1. The pages from the trust document that
identify the trustees, or
2. A certification for trust
- ------------------------------------------------------------------
</TABLE>

Street or Nominee Accounts. If you have Fund shares held in a "street" or
"nominee" name account with your Securities Dealer, you may transfer the shares
to the street or nominee name account of another Securities Dealer. Both dealers
must have an agreement with Distributors or we cannot process the transfer.
Contact your Securities Dealer to initiate the transfer. We will process the
transfer after we receive authorization in proper form from your delivering
Securities Dealer. Accounts may be transferred electronically through the NSCC.
For accounts registered in street or nominee name, we may take instructions
directly from the Securities Dealer or your nominee.

Important Information If You Have an Investment Representative

If there is a Securities Dealer or other representative of record on your
account, we are authorized: (1) to provide confirmations, account statements and
other information about your account directly to your dealer and/or

42 globe Templeton Growth Fund, Inc.

<PAGE>

representative; and (2) to accept telephone and electronic instructions directly
from your dealer or representative, including instructions to exchange or redeem
your shares. Electronic instructions may be processed through established
electronic trading systems and programs used by the Fund. Telephone instructions
directly from your representative will be accepted unless you have told us that
you do not want telephone privileges to apply to your account.

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 $50. 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 $100.

SERVICES TO HELP YOU MANAGE YOUR ACCOUNT

Automatic Investment Plan

Our automatic investment plan offers a convenient way to invest in the Fund.
Under the plan, you can have money transferred automatically from your checking
account to the Fund each month to buy additional shares. If you are interested
in this program, please refer to the shareholder application included with this
prospectus or contact your investment representative. The market value of the
Fund's shares may fluctuate and a systematic investment plan such as this will
not assure a profit or protect against a loss. You may discontinue the program
at any time by notifying Investor Services by mail or phone.

Systematic Withdrawal Plan

Our systematic withdrawal plan allows you to sell your shares and receive
regular payments from your account on a monthly, quarterly, semiannual or annual
basis. The value of your account must be at least $5,000 and the minimum payment
amount for each withdrawal must be at least $50. For retirement plans subject to
mandatory distribution requirements, the $50 minimum will not apply.

Templeton Growth Fund, Inc. globe 43

<PAGE>

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 account. Once your plan is established, any
distributions paid by the Fund will be automatically reinvested in your account.

You will generally receive your payment by the end of the month in which a
payment is scheduled. When you sell your shares under a systematic withdrawal
plan, it is a taxable transaction.

To avoid paying sales charges on money you plan to withdraw within a short
period of time, you may not want to set up a systematic withdrawal plan if you
plan to buy shares on a regular basis. Shares sold under the plan may also be
subject to a Contingent Deferred Sales Charge. Please see "Contingent Deferred
Sales Charge" under "How Do I Sell Shares?"

You may discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment by notifying us in writing at
least seven business days before the end of the month preceding a scheduled
payment. Please see "How Do I Buy, Sell and Exchange Shares? - Systematic
Withdrawal Plan" in the SAI for more information.

TeleFACTS(R)

From a touch-tone phone, you may call our TeleFACTS(R) system (day or night) at
1-800/247-1753 to:

- - obtain information about your account;

- - obtain price and performance information about any Franklin Templeton Fund;

- - exchange shares between identically registered Franklin accounts; and

- - request duplicate statements and deposit slips for Franklin accounts.

You will need the code number for each class to use TeleFACTS(R). The code
number is 101 for Class I and 201 for Class II.

44 globe Templeton Growth Fund, Inc.

<PAGE>

Statements and Reports to Shareholders

We will send you the following statements and reports on a regular basis:

- - Confirmation and account statements reflecting transactions in your account,
including additional purchases and dividend reinvestments. PLEASE VERIFY THE
ACCURACY OF YOUR STATEMENTS WHEN YOU RECEIVE THEM.

- - Financial reports of the Fund will be sent every six months. To reduce Fund
expenses, we attempt to identify related shareholders within a household and
send only one copy of a report. Call Fund Information if you would like an
additional free copy of the Fund's financial reports.

Institutional Accounts

Additional methods of buying, selling or exchanging shares of the Fund may be
available to institutional accounts. Institutional investors may also be
required to complete an institutional account application. For more information,
call Institutional Services.

Availability of These Services

The services above are available to most shareholders. If, however, your shares
are held by a financial institution, in a street name account, or networked
through the NSCC, the Fund may not be able to offer these services directly to
you. Please contact your investment representative.

WHAT IF I HAVE QUESTIONS ABOUT MY ACCOUNT?

If you have any questions about your account, you may write to Investor Services
at 100 Fountain Parkway, P.O. Box 33030, St. Petersburg, Florida 33733-8030. The
Fund and Distributors are also located at this address.

Templeton Growth Fund, Inc. globe 45

<PAGE>

Global Advisors is located in Lyford Cay, Nassau, Bahamas. You may also contact
us by phone at one of the numbers listed below.

<TABLE>
<CAPTION>
HOURS OF OPERATION (EASTERN
TIME)
DEPARTMENT NAME TELEPHONE NO. (MONDAY THROUGH FRIDAY)
- --------------------------------------------------------------------
<S> <C> <C>
Shareholder Services 1-800/632-2301 8:30 a.m. to 8:00 p.m.
Dealer Services 1-800/524-4040 8:30 a.m. to 8:00 p.m.
Fund Information 1-800/DIAL BEN 8:30 a.m. to 11:00 p.m.
9:30 a.m. to 5:30 p.m.
(1-800/342-5236) (Saturday)
Retirement Plan
Services 1-800/527-2020 8:30 a.m. to 8:00 p.m.
Institutional Services 1-800/321-8563 9:00 a.m. to 8:00 p.m.
TDD (hearing impaired) 1-800/851-0637 8:30 a.m. to 8:00 p.m.
</TABLE>

Your phone call may be monitored or recorded to ensure we provide you with high
quality service. You will hear a regular beeping tone if your call is being
recorded.

46 globe Templeton Growth Fund, Inc.

<PAGE>

GLOSSARY

USEFUL TERMS AND DEFINITIONS

Board - The Board of Directors of the Fund

CD - Certificate of deposit

Class I, Class II and Advisor Class - The Fund offers three classes of shares,
designated "Class I," "Class II," and "Advisor Class." The three classes have
proportionate interests in the Fund's portfolio. They differ, however, primarily
in their sales charge and expense structures.

Code - Internal Revenue Code of 1986, as amended

Contingency Period - For Class I shares, the 12 month period during which a
Contingent Deferred Sales Charge may apply. For Class II shares, the contingency
period is 18 months. Regardless of when during the month you purchased shares,
they will age one month on the last day of that month and each following month.

Contingent Deferred Sales Charge (CDSC) - A sales charge of 1% that may apply if
you sell your shares within the Contingency Period.

Depositary Receipts - are certificates that give their holders the right to
receive securities (a) of a foreign issuer deposited in a U.S. bank or trust
company (American Depositary Receipts, "ADRs"); or (b) of a foreign or U.S.
issuer deposited in a foreign bank or trust company (Global Depositary Receipts,
"GDRs" or European Depositary Receipts, "EDRs").

Distributors - Franklin/Templeton Distributors, Inc., the Fund's principal
underwriter. The SAI lists the officers and Board members who are affiliated
with Distributors. See "Officers and Directors."

Eligible Governmental Authority - Any state or local government or any
instrumentality, department, authority or agency thereof that has determined the
Fund is a legally permissible investment and that can only buy shares of the
Fund without paying sales charges.

Franklin Templeton Funds - The U.S. registered mutual funds in the Franklin
Group of Funds(R) and the Templeton Group of Funds except Franklin Valuemark
Funds, Templeton Capital Accumulator Fund, Inc., Templeton Variable Annuity
Fund, and Templeton Variable Products Series Fund.

Templeton Growth Fund, Inc. globe 47

<PAGE>

Franklin Templeton Group - Franklin Resources, Inc., a publicly owned holding
company, and its various subsidiaries

Franklin Templeton Group of Funds - All U.S. registered investment companies in
the Franklin Group of Funds(R) and the Templeton Group of Funds

FT Services - Franklin Templeton Services, Inc., the Fund's administrator

Global Advisors - Templeton Global Advisors Limited, the Fund's investment
manager

Investor Services - Franklin/Templeton Investor Services, Inc., the Fund's
shareholder servicing and transfer agent

IRS - Internal Revenue Service

Letter - Letter of Intent

Market Timers - Market Timers generally include market timing or asset
allocation services, accounts administered so as to buy, sell or exchange shares
based on predetermined market indicators, or any person or group whose
transactions seem to follow a timing pattern or whose transactions include
frequent or large exchanges.

Moody's - Moody's Investors Service, Inc.

NASD - National Association of Securities Dealers, Inc.

Net Asset Value (NAV) - The value of a mutual fund is determined by deducting
the fund's liabilities from the total assets of the portfolio. The net asset
value per share is determined by dividing the net asset value of the fund by the
number of shares outstanding.

NSCC - National Securities Clearing Corporation

NYSE - New York Stock Exchange

Offering Price - The public offering price is based on the Net Asset Value per
share of the class and includes the front-end sales charge. The maximum
front-end sales charge is 5.75% for Class I and 1% for Class II.

Qualified Retirement Plans - An employer sponsored pension or profit-sharing
plan that qualifies under section 401 of the Code. Examples include 401(k),
money purchase pension, profit sharing and defined benefit plans.

Resources - Franklin Resources, Inc.

48 globe Templeton Growth Fund, Inc.

<PAGE>

SAI - Statement of Additional Information

S&P - Standard & Poor's Corporation

SEC - U.S. Securities and Exchange Commission

Securities Dealer - A financial institution that, either directly or through
affiliates, has an agreement with Distributors to handle customer orders and
accounts with the Fund. This reference is for convenience only and does not
indicate a legal conclusion of capacity.

SEP - An employer sponsored simplified employee pension plan established under
section 408(k) of the Code

TeleFACTS(R) - Franklin Templeton's automated customer servicing system

Trust Company - Franklin Templeton Trust Company. Trust Company is an affiliate
of Distributors and both are wholly owned subsidiaries of Resources.

U.S. - United States

We/Our/Us - Unless the context indicates a different meaning, these terms refer
to the Fund and/or Investor Services, Distributors, or other wholly owned
subsidiaries of Resources.

Templeton Growth Fund, Inc. globe 49

<PAGE>

FRANKLIN TEMPLETON GROUP OF FUNDS

LITERATURE REQUEST E CALL 1-800/DIAL BEN (1-800/342-5236) today for a free
descriptive brochure and prospectus on any of the funds listed below. The
prospectus contains more complete information, including fees, charges and
expenses, and should be read carefully before investing or sending money.

GLOBAL GROWTH

Franklin Global Health Care Fund
Franklin Templeton Japan Fund
Templeton Developing Markets Trust
Templeton Foreign Fund
Templeton Foreign Smaller
Companies Fund
Templeton Global
Infrastructure Fund
Templeton Global
Opportunities Trust
Templeton Global Real Estate Fund
Templeton Global Smaller
Companies Fund
Templeton Greater European Fund
Templeton Growth Fund
Templeton Latin America Fund
Templeton Pacific Growth Fund
Templeton World Fund

GLOBAL GROWTH AND INCOME

Franklin Global Utilities Fund
Franklin Templeton German
Government Bond Fund
Franklin Templeton
Global Currency Fund
Mutual European Fund
Templeton Global Bond Fund
Templeton Growth and Income
Fund

GLOBAL INCOME

Franklin Global Government
Income Fund
Franklin Templeton Hard
Currency Fund
Franklin Templeton High
Income Currency Fund
Templeton Americas
Government Securities Fund

GROWTH

Franklin Biotechnology
Discovery Fund
Franklin Blue Chip Fund
Franklin California Growth Fund
Franklin DynaTech Fund
Franklin Equity Fund
Franklin Gold Fund
Franklin Growth Fund
Franklin MidCap Growth Fund
Franklin Small Cap Growth Fund
Mutual Discovery Fund

GROWTH AND INCOME

Franklin Asset Allocation Fund
Franklin Balance Sheet
Investment Fund
Franklin Convertible Securities Fund
Franklin Equity Income Fund
Franklin Income Fund
Franklin MicroCap Value Fund
Franklin Natural Resources Fund
Franklin Real Estate Securities Fund
Franklin Rising Dividends Fund
Franklin Strategic Income Fund
Franklin Utilities Fund
Franklin Value Fund
Mutual Beacon Fund
Mutual Financial Services Fund
Mutual Qualified Fund
Mutual Shares Fund
Templeton American Trust, Inc.

FUND ALLOCATOR SERIES
Franklin Templeton
Conservative Target Fund
Franklin Templeton
Moderate Target Fund
Franklin Templeton
Growth Target Fund

INCOME

Franklin Adjustable Rate
Securities Fund
Franklin Adjustable U.S.
Government Securities Fund
Franklin's AGE High Income Fund
Franklin Investment
Grade Income Fund
Franklin Short-Intermediate U.S.
Government Securities Fund
Franklin U.S. Government
Securities Fund
Franklin Money Fund
Franklin Federal Money Fund
FOR CORPORATIONS
Franklin Corporate Qualified
Dividend Fund

FRANKLIN FUNDS SEEKING
TAX-FREE INCOME

Federal Intermediate-Term
Tax-Free Income Fund
Federal Tax-Free Income Fund
High Yield Tax-Free Income Fund
Insured Tax-Free Income Fund
Puerto Rico Tax-Free Income Fund
Tax-Exempt Money Fund

FRANKLIN STATE-SPECIFIC FUNDS
SEEKING TAX-FREE INCOME

Alabama
Arizona*
Arkansas**
California*
Colorado
Connecticut
Florida*
Georgia
Hawaii**
Indiana
Kentucky
Louisiana
Maryland
Massachusetts***
Michigan*
Minnesota***
Missouri
New Jersey
New York*
North Carolina
Ohio***
Oregon
Pennsylvania
Tennessee**
Texas
Virginia
Washington**

VARIABLE ANNUITIES+

Franklin Valuemark(R)
Franklin Templeton
Valuemark Income Plus
(an immediate annuity)

*Two or more fund options available: long-term portfolio, intermediate-term
portfolio, a portfolio of insured municipal securities, and/or a high yield
portfolio (CA) and a money market portfolio (CA and NY).
**The fund may invest up to 100% of its assets in bonds that pay interest
subject to the federal alternative minimum tax.
***Portfolio of insured municipal securities.
+Franklin Valuemark and Franklin Templeton Valuemark Income Plus are issued by
Allianz Life Insurance Company of North America or by its wholly owned
subsidiary, Preferred Life Insurance Company of New York, and distributed by
NALAC Financial Plans, LLC.

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<S> <C>
TEMPLETON ----------------
GROWTH FUND, INC. BULK RATE
P.O. Box 33031 U.S. POSTAGE
St. Petersburg, FL 33733-8031 PAID
- ----------------------------- SACRAMENTO, CA
PERMIT NO. 333
----------------
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