o FIST1 P-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE PROSPECTUS OF
FRANKLIN INVESTORS SECURITIES TRUST
(FRANKLIN CONVERTIBLE SECURITIES FUND, FRANKLIN EQUITY INCOME FUND, FRANKLIN
GLOBAL GOVERNMENT INCOME FUND, FRANKLIN SHORT-INTERMEDIATE U.S. GOVERNMENT
SECURITIES FUND)
DATED MARCH 1, 2000
The prospectus is amended as follows:
I. All references to Franklin Templeton Trust Company in this prospectus are
replaced with Franklin Templeton Bank & Trust.
II. The "Management" section on page 22 is replaced with the following:
[Insert graphic of briefcase] MANAGEMENT
Franklin Advisers, Inc. (Advisers), 777 Mariners Island Blvd., San Mateo, CA
94404, is the fund's investment manager. Together, Advisers and its
affiliates manage over $233 billion in assets.
The team responsible for the fund's management is:
FRANK FELICELLI CFA, SENIOR VICE PRESIDENT OF ADVISERS
Mr. Felicelli has been a manager of the fund since 1988. He joined the
Franklin Templeton Group in 1986.
DEREK TANER CFA, PORTFOLIO MANAGER OF ADVISERS
Mr. Taner has been a manager of the Fund since 20[]. He joined the Franklin
Templeton Group in 1991.
HOWARD M. MCELDOWNEY, PORTFOLIO MANAGER OF ADVISERS
Mr. McEldowney has been generally involved with the investment strategy of
the fund's portfolio since the fund's inception and has more than 30 years'
experience in the securities industry.
The fund pays Advisers a fee for managing the fund's assets. For the fiscal
year ended October 31, 1999, the fund paid 0.50% of its average monthly net
assets to the manager for its services.
III. The section "minimum investments" on page 50 is replaced with the
following:
Minimum investments
- ----------------------------------------------------------------------
Initial Additional
- ----------------------------------------------------------------------
Regular accounts $1,000 $50
- ----------------------------------------------------------------------
Automatic investment plans $50 ($25 for an $50 ($25 for an
Education IRA) Education IRA)
- ----------------------------------------------------------------------
UGMA/UTMA accounts $100 $50
- ----------------------------------------------------------------------
Retirement accounts
(other than IRAs, IRA rollovers,
Education IRAs or Roth IRAs) no minimum no minimum
- ----------------------------------------------------------------------
IRAs, IRA rollovers, Education
IRAs or Roth IRAs $250 $50
- ----------------------------------------------------------------------
Broker-dealer sponsored wrap
account programs $250 $50
- ----------------------------------------------------------------------
Full-time employees, officers,
trustees and directors of
Franklin Templeton entities, and
their immediate family members $100 $50
- ----------------------------------------------------------------------
PLEASE NOTE THAT YOU MAY ONLY BUY SHARES OF A FUND ELIGIBLE FOR SALE IN YOUR
STATE OR JURISDICTION.
IV. The section "Account Application" on page 51 is replaced with the
following:
ACCOUNT APPLICATION If you are opening a new account, please complete and
sign the enclosed account application. Make sure you indicate the share class
you have chosen. If you do not indicate a class, we will place your purchase
in Class A shares. To save time, you can sign up now for services you may
want on your account by completing the appropriate sections of the
application (see "Investor Services" on page 52). For example, if you would
like to link one of your bank accounts to your fund account so that you may
use electronic fund transfers to and from your bank account to buy and sell
shares, please complete the bank information section of the application. We
will keep your bank information on file for future purchases and redemptions.
V. Effective July 3, 2000, the following is added to the section "Buying
shares" on page 51:
[Insert graphic of If you have another Before requesting a
phone] BY PHONE Franklin Templeton telephone purchase,
account with your please make sure we
(Up to $100,000 per bank account have your bank
day) information on file, account information
1-800/632-2301 you may open a new on file. If we do not
account by phone. The have this
accounts must be information, you will
identically need to send written
registered. instructions with
your bank's name and
To make a same day address, a voided
investment, please check or savings
call us by 1:00 p.m. account deposit slip,
Pacific time or the and a signature
close of the New York guarantee if the
Stock Exchange, ownership of the bank
whichever is earlier. and fund accounts
is different.
To make a same day
investment, please
call us by 1:00 p.m.
Pacific time or the
close of the New York
Stock Exchange,
whichever is earlier.
VI. The section "Automatic Investment Plan" on page 52 is replaced with the
following:
AUTOMATIC INVESTMENT PLAN This plan offers a convenient way for you to invest
in the fund by automatically transferring money from your checking or savings
account each month to buy shares. To sign up, complete the appropriate
section of your account application and mail it to Investor Services. If you
are opening a new account, please include the minimum initial investment of
$50 ($25 for an Education IRA) with your application.
VII. The section "Telephone Privileges" on page 53 is replaced with the
following:
TELEPHONE PRIVILEGES You will automatically receive telephone privileges when
you open your account, allowing you and your investment representative to
buy, sell or exchange your shares and make certain other changes to your
account by phone.
For accounts with more than one registered owner, telephone privileges also
allow the fund to accept written instructions signed by only one owner for
transactions and account changes that could otherwise be made by phone. For
all other transactions and changes, all registered owners must sign the
instructions. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one
signature for all transactions. This type of telephone exchange is available
as long as you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone purchase, exchange or redemption privileges
on your account application.
VIII. The following paragraph is added to the section "Dealer compensation"
on page 59:
MARKET TIMERS. Please note that for Class A NAV purchases by market timers,
including purchases of $1 million or more, dealers are not eligible to
receive the dealer commission. Dealers, however, may be eligible to receive
the 12b-1 fee from the date of purchase. If a dealer commission is paid on a
Class A NAV purchase that we later determine was made by a market timer, all
commissions paid in connection with that purchase during the last twelve
months must
be returned.
Please keep this supplement for future reference.
o FIST1 PA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE PROSPECTUS OF
FRANKLIN INVESTORS SECURITIES TRUST
(FRANKLIN GLOBAL GOVERNMENT INCOME FUND AND
FRANKLIN SHORT-INTERMEDIATE U.S. GOVERNMENT SECURITIES FUND - ADVISOR CLASS)
DATED MARCH 1, 2000
The prospectus is amended as follows:
I. All references to Franklin Templeton Trust Company in this prospectus are
replaced with Franklin Templeton Bank & Trust.
II. The section "Account Application" on page 24 is replaced with the
following:
ACCOUNT APPLICATION If you are opening a new account, please complete and
sign the enclosed account application. To save time, you can sign up now for
services you may want on your account by completing the appropriate sections
of the application (see "Investor Services" on page 25). For example, if you
would like to link one of your bank accounts to your fund account so that you
may use electronic fund transfers to and from your bank account to buy and
sell shares, please complete the bank information section of the application.
We will keep your bank information on file for future purchases and
redemptions.
III. Effective July 3, 2000, the following is added to the section "Buying
shares" on page 24:
[Insert graphic of If you have another Before requesting a
phone] BY PHONE Franklin Templeton telephone purchase,
(Up to $100,000 per account with your please make sure we
day) 1-800/632-2301 bank account have your bank
information on file, account information
you may open a new on file. If we do not
account by phone. The have this
accounts must be information, you will
identically need to send written
registered. instructions with
your bank's name and
To make a same day address, a voided
investment, please check or savings
call us by 1:00 p.m. account deposit slip,
Pacific time or the and a signature
close of the New York guarantee if the
Stock Exchange, ownership of the bank
whichever is earlier. and fund accounts is
different.
To make a same day
investment, please
call us by 1:00 p.m.
Pacific time or the
close of the New York
Stock Exchange,
whichever is earlier.
IV. The section "Automatic Investment Plan" on page 25 is replaced with the
following:
AUTOMATIC INVESTMENT PLAN This plan offers a convenient way for you to invest
in the fund by automatically transferring money from your checking or savings
account each month to buy shares. To sign up, complete the appropriate
section of your account application and mail it to Investor Services. If you
are opening a new account, please include your minimum initial investment
with your application.
V. The following section is added to "Investor Services" on page 25:
AUTOMATIC PAYROLL DEDUCTION You may invest in the fund automatically by
transferring money from your paycheck to the fund by electronic funds
transfer. If you are interested, indicate on your application that you would
like to receive an Automatic Payroll Deduction Program kit.
VI. The section "Telephone Privileges" on page 25 is replaced with the
following:
TELEPHONE PRIVILEGES You will automatically receive telephone privileges when
you open your account, allowing you and your investment representative to
buy, sell or exchange your shares and make certain other changes to your
account by phone.
For accounts with more than one registered owner, telephone privileges also
allow the fund to accept written instructions signed by only one owner for
transactions and account changes that could otherwise be made by phone. For
all other transactions and changes, all registered owners must sign the
instructions. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one
signature for all transactions. This type of telephone exchange is available
as long as you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone purchase, exchange or redemption privileges
on your account application.
Please keep this supplement for future reference.
o FIST2 P-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE PROSPECTUS OF
FRANKLIN INVESTOR SECURITIES TRUST
(FRANKLIN ADJUSTABLE U.S. GOVERNMENT SECURITIES AND FRANKLIN BOND FUNDS)
DATED MARCH 1, 2000
I. All references to Franklin Templeton Trust Company in this prospectus are
replaced with Franklin Templeton Bank & Trust.
II. The section "Minimum investments" on page 25 is replaced with the
following:
MINIMUM INVESTMENTS
- ----------------------------------------------------------------------
INITIAL ADDITIONAL
- ----------------------------------------------------------------------
Regular accounts $1,000 $50
- ----------------------------------------------------------------------
Automatic investment plans $50 ($25 for an $50 ($25 for an
Education IRA) Education IRA)
- ----------------------------------------------------------------------
UGMA/UTMA accounts $100 $50
- ----------------------------------------------------------------------
Retirement accounts
(other than IRAs, IRA
rollovers, Education IRAs or
Roth IRAs) no minimum no minimum
- ----------------------------------------------------------------------
IRAs, IRA rollovers, Education
IRAs or Roth IRAs $250 $50
- ----------------------------------------------------------------------
Broker-dealer sponsored wrap
account programs $250 $50
- ----------------------------------------------------------------------
Full-time employees, officers,
trustees and directors of
Franklin Templeton entities,
and their immediate family
members $100 $50
- ----------------------------------------------------------------------
Please note that you may only buy shares of a fund eligible for sale in your
state or jurisdiction.
III. The section "Account Application" on page 26 is replaced with the
following:
ACCOUNT APPLICATION If you are opening a new account, please complete and
sign the enclosed account application. To save time, you can sign up now for
services you may want on your account by completing the appropriate sections
of the application (see "Investor Services" on page 27). For example, if you
would like to link one of your bank accounts to your fund account so that you
may use electronic fund transfers to and from your bank account to buy and
sell shares, please complete the bank information section of the application.
We will keep your bank information on file for future purchases and
redemptions.
IV. Effective July 3, 2000, the following is added to the section "Buying
shares" on page 26:
[Insert graphic of If you have another Before requesting a
phone] By Phone Franklin Templeton telephone purchase,
(Up to $100,000 per account with your please make sure we
day) bank account have your bank
1-800/632-2301 information on file, account information
you may open a new on file. If we do not
account by phone. The have this
accounts must be information, you will
identically need to send written
registered. instructions with
your bank's name and
To make a same day address, a voided
investment, please check or savings
call us by 1:00 p.m. account deposit slip,
Pacific time or the and a signature
close of the New York guarantee if the
Stock Exchange, ownership of the bank
whichever is earlier. and fund accounts is
different.
To make a same day
investment, please
call us by 1:00 p.m.
Pacific time or the
close of the New York
Stock Exchange,
whichever is earlier.
V. The section "Automatic Investment Plan" on page 27 is replaced with the
following:
AUTOMATIC INVESTMENT PLAN This plan offers a convenient way for you to invest
in the fund by automatically transferring money from your checking or savings
account each month to buy shares. To sign up, complete the appropriate
section of your account application and mail it to Investor Services. If you
are opening a new account, please include the minimum initial investment of
$50 ($25 for an Education IRA) with your application.
VI. The section "Telephone Privileges" on page 28 is replaced with the
following:
TELEPHONE PRIVILEGES You will automatically receive telephone privileges when
you open your account, allowing you and your investment representative to
buy, sell or exchange your shares and make certain other changes to your
account by phone.
For accounts with more than one registered owner, telephone privileges also
allow the fund to accept written instructions signed by only one owner for
transactions and account changes that could otherwise be made by phone. For
all other transactions and changes, all registered owners must sign the
instructions. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one
signature for all transactions. This type of telephone exchange is available
as long as you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone purchase, exchange or redemption privileges
on your account application.
VII. The following paragraph is added to the section "Dealer compensation" on
page 34:
Market timers. Please note that for NAV purchases by market timers, including
purchases of $1 million or more, dealers are not eligible to receive the
dealer commission. Dealers, however, may be eligible to receive the 12b-1 fee
from the date of purchase. If a dealer commission is paid on a NAV purchase
that we later determine was made by a market timer, all commissions paid in
connection with that purchase during the last twelve months must be returned.
Please keep this supplement for future reference.
o FIST2 PA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE PROSPECTUS OF
FRANKLIN BOND FUND - ADVISOR CLASS
DATED MARCH 1, 2000
The prospectus is amended as follows:
I. Under the "Principal investment strategies" discussion on page 2, the
fifth paragraph of that section is replaced with the following:
Asset backed-securities are securities backed by loans, leases and other
receivables.
II. All references to Franklin Templeton Trust Company in this prospectus are
replaced with Franklin Templeton Bank & Trust.
III. The section "Account Application" on page 14 is replaced with the
following:
ACCOUNT APPLICATION If you are opening a new account, please complete and
sign the enclosed account application. To save time, you can sign up now for
services you may want on your account by completing the appropriate sections
of the application (see "Investor Services" on page 15). For example, if you
would like to link one of your bank accounts to your fund account so that you
may use electronic fund transfers to and from your bank account to buy and
sell shares, please complete the bank information section of the application.
We will keep your bank information on file for future purchases and
redemptions.
IV. Effective July 3, 2000, the following is added to the section "Buying
shares" on page 14:
[Insert graphic of If you have another Before requesting a
phone] By Phone Franklin Templeton telephone purchase,
account with your please make sure we
(Up to $100,000 per bank account have your bank
day) information on file, account information
1-800/632-2301 you may open a new on file. If we do not
account by phone. The have this
accounts must be information, you will
identically need to send written
registered. instructions with
your bank's name and
To make a same day address, a voided
investment, please check or savings
call us by 1:00 p.m. account deposit slip,
Pacific time or the and a signature
close of the New York guarantee if the
Stock Exchange, ownership of the bank
whichever is earlier. and fund accounts is
different.
To make a same day
investment, please
call us by 1:00 p.m.
Pacific time or the
close of the New York
Stock Exchange,
whichever is earlier.
V. The section "Automatic Investment Plan" on page 15 is replaced with the
following:
AUTOMATIC INVESTMENT PLAN This plan offers a convenient way for you to invest
in the fund by automatically transferring money from your checking or savings
account each month to buy shares. To sign up, complete the appropriate
section of your account application and mail it to Investor Services. If you
are opening a new account, please include your minimum initial investment
with your application.
VI. The following section is added to "Investor Services" on page 15:
AUTOMATIC PAYROLL DEDUCTION You may invest in the fund automatically by
transferring money from your paycheck to the fund by electronic funds
transfer. If you are interested, indicate on your application that you would
like to receive an Automatic Payroll Deduction Program kit.
VII. The section "Telephone Privileges" on page 15 is replaced with the
following:
TELEPHONE PRIVILEGES You will automatically receive telephone privileges when
you open your account, allowing you and your investment representative to
buy, sell or exchange your shares and make certain other changes to your
account by phone.
For accounts with more than one registered owner, telephone privileges also
allow the fund to accept written instructions signed by only one owner for
transactions and account changes that could otherwise be made by phone. For
all other transactions and changes, all registered owners must sign the
instructions. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one
signature for all transactions. This type of telephone exchange is available
as long as you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone purchase, exchange or redemption privileges
on your account application.
Please keep this supplement for future reference.
o FIST1 SA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE STATEMENT OF ADDITIONAL INFORMATION OF
FRANKLIN INVESTORS SECURITIES TRUST
(FRANKLIN CONVERTIBLE SECURITIES, EQUITY INCOME, GLOBAL GOVERNMENT INCOME,
SHORT-INTERMEDIATE U.S. GOVERNMENT SECURITIES FUNDS)
DATED MARCH 1, 2000
The Statement of Additional Information (SAI) is amended as follows:
I. All references to Franklin Templeton Trust Company in this SAI are
replaced with Franklin Templeton Bank & Trust.
II. The first waiver category in the section "Waivers for certain investors"
on page 33 is revised to read:
o Trust companies and bank trust departments investing 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 may accept orders for these accounts by telephone
or other means of electronic data transfer directly from the bank or trust
company, with payment by federal funds received by the close of business on
the next business day following the order.
III. The eighth waiver category in the section "CDSC waivers" on page 35 is
revised to read:
o Redemptions by an employee benefit plan: (i) that is a customer of Franklin
Templeton Defined Contribution Services; and/or (ii) whose assets are held by
Franklin Templeton Bank & Trust as trustee or custodian (not applicable to
Class B)
IV. The section "Systematic withdrawal plan" on page 36 is replaced with the
following:
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. There are no service charges
for establishing or maintaining a systematic withdrawal plan.
Each month in which a payment is scheduled, we will redeem an equivalent
amount of shares in your account on the day of the month you have indicated
on your account application or, if no day is indicated, on the 20th day of
the month. If that day falls on a weekend or holiday, we will process the
redemption on the next business day. For plans set up before June 1, 2000, we
will continue to process redemptions on the 25th day of the month (or the
next business day) unless you instruct us to change the processing date.
Available processing dates currently are the 1st, 5th, 10th, 15th, 20th and
25th days of the month. 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 also
may be subject to a CDSC.
Redeeming shares through a systematic withdrawal plan may reduce or exhaust
the shares in your account if payments exceed distributions received from the
fund. This is especially likely to occur if there is a market decline. If a
withdrawal amount exceeds the value of your account, your account will be
closed and the remaining balance in your account will be sent to you. Because
the amount withdrawn under the plan may be more than your actual yield or
income, part of the payment may be a return of your investment.
To discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment, we must receive instructions
from you at least three business days before a scheduled payment. The fund
may discontinue a systematic withdrawal plan by notifying you in writing and
will discontinue a systematic withdrawal plan automatically if all shares in
your account are withdrawn or if the fund receives notification of the
shareholder's death or incapacity.
V. The following paragraph is added to the section "General information" on
page 37:
There are special procedures for banks and other institutions that wish to
open multiple accounts. An institution may open a single master account by
filing one application form with the fund, signed by personnel authorized to
act for the institution. Individual sub-accounts may be opened when the
master account is opened by listing them on the application, or by providing
instructions to the fund at a later date. These sub-accounts may be
registered either by name or number. The fund's investment minimums apply to
each sub-account. The fund will send confirmation and account statements for
the sub-accounts to the institution.
Please keep this supplement for future reference.
o FIST1 SAA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE STATEMENT OF ADDITIONAL INFORMATION OF
FRANKLIN INVESTORS SECURITIES TRUST - ADVISOR CLASS
(FRANKLIN GLOBAL GOVERNMENT INCOME FUND AND
FRANKLIN SHORT-INTERMEDIATE U.S. GOVERNMENT SECURITIES FUND)
DATED MARCH 1, 2000
The Statement of Additional Information (SAI) is amended as follows:
I. All references to Franklin Templeton Trust Company in this prospectus are
replaced with Franklin Templeton Bank & Trust.
II. The section "Systematic withdrawal plan" on page 26 is replaced with the
following:
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. There are no service charges
for establishing or maintaining a systematic withdrawal plan.
Each month in which a payment is scheduled, we will redeem an equivalent
amount of shares in your account on the day of the month you have indicated
on your account application or, if no day is indicated, on the 20th day of
the month. If that day falls on a weekend or holiday, we will process the
redemption on the next business day. For plans set up before June 1, 2000, we
will continue to process redemptions on the 25th day of the month (or the
next business day) unless you instruct us to change the processing date.
Available processing dates currently are the 1st, 5th, 10th, 15th, 20th and
25th days of the month. When you sell your shares under a systematic
withdrawal plan, it is a taxable transaction.
Redeeming shares through a systematic withdrawal plan may reduce or exhaust
the shares in your account if payments exceed distributions received from the
fund. This is especially likely to occur if there is a market decline. If a
withdrawal amount exceeds the value of your account, your account will be
closed and the remaining balance in your account will be sent to you. Because
the amount withdrawn under the plan may be more than your actual yield or
income, part of the payment may be a return of your investment.
To discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment, we must receive instructions
from you at least three business days before a scheduled payment. The fund
may discontinue a systematic withdrawal plan by notifying you in writing and
will discontinue a systematic withdrawal plan automatically if all shares in
your account are withdrawn or if the fund receives notification of the
shareholder's death or incapacity.
III. The following paragraph is added to the section "General information" on
page 27:
There are special procedures for banks and other institutions that wish to
open multiple accounts. An institution may open a single master account by
filing one application form with the fund, signed by personnel authorized to
act for the institution. Individual sub-accounts may be opened when the
master account is opened by listing them on the application, or by providing
instructions to the fund at a later date. These sub-accounts may be
registered either by name or number. The fund's investment minimums apply to
each sub-account. The fund will send confirmation and account statements for
the sub-accounts to the institution.
Please keep this supplement for future reference.
o FIST2 SA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE STATEMENT OF ADDITIONAL INFORMATION OF
FRANKLIN INVESTORS SECURITIES TRUST
(FRANKLIN ADJUSTABLE U.S. GOVERNMENT SECURITIES FUND AND FRANKLIN BOND FUND)
DATED MARCH 1, 2000
The Statement of Additional Information (SAI) is amended as follows:
I. All references to Franklin Templeton Trust Company in this SAI are
replaced with Franklin Templeton Bank & Trust.
II. The first waiver category in the section "Waivers for certain investors"
on page 31 is revised to read:
o Trust companies and bank trust departments investing 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 may accept orders for these accounts by telephone
or other means of electronic data transfer directly from the bank or trust
company, with payment by federal funds received by the close of business on
the next business day following the order.
III. The eighth waiver category in the "CDSC waivers" on page 33 is revised
to read:
o Redemptions by an employee benefit plan: (i) that is a customer of Franklin
Templeton Defined Contribution Services; and/or (ii) whose assets are held by
Franklin Templeton Bank & Trust as trustee or custodian
IV. The section "Systematic withdrawal plan" on page 33 is replaced with the
following:
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. There are no service charges
for establishing or maintaining a systematic withdrawal plan.
Each month in which a payment is scheduled, we will redeem an equivalent
amount of shares in your account on the day of the month you have indicated
on your account application or, if no day is indicated, on the 20th day of
the month. If that day falls on a weekend or holiday, we will process the
redemption on the next business day. For plans set up before June 1, 2000, we
will continue to process redemptions on the 25th day of the month (or the
next business day) unless you instruct us to change the processing date.
Available processing dates currently are the 1st, 5th, 10th, 15th, 20th and
25th days of the month. 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 also
may be subject to a CDSC.
Redeeming shares through a systematic withdrawal plan may reduce or exhaust
the shares in your account if payments exceed distributions received from the
fund. This is especially likely to occur if there is a market decline. If a
withdrawal amount exceeds the value of your account, your account will be
closed and the remaining balance in your account will be sent to you. Because
the amount withdrawn under the plan may be more than your actual yield or
income, part of the payment may be a return of your investment.
To discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment, we must receive instructions
from you at least three business days before a scheduled payment. The fund
may discontinue a systematic withdrawal plan by notifying you in writing and
will discontinue a systematic withdrawal plan automatically if all shares in
your account are withdrawn or if the fund receives notification of the
shareholder's death or incapacity.
V. The following paragraph is added to the section "General information" on
page 34:
There are special procedures for banks and other institutions that wish to
open multiple accounts. An institution may open a single master account by
filing one application form with the fund, signed by personnel authorized to
act for the institution. Individual sub-accounts may be opened when the
master account is opened by listing them on the application, or by providing
instructions to the fund at a later date. These sub-accounts may be
registered either by name or number. The fund's investment minimums apply to
each sub-account. The fund will send confirmation and account statements for
the sub-accounts to the institution.
Please keep this supplement for future reference.
o FIST2 SAA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE STATEMENT OF ADDITIONAL INFORMATION OF
FRANKLIN BOND FUND - ADVISOR CLASS
DATED MARCH 1, 2000
The Statement of Additional Information (SAI) is amended as follows:
I. The section "Systematic withdrawal plan" on page 25 is replaced with the
following:
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. There are no service charges
for establishing or maintaining a systematic withdrawal plan.
Each month in which a payment is scheduled, we will redeem an equivalent
amount of shares in your account on the day of the month you have indicated
on your account application or, if no day is indicated, on the 20th day of
the month. If that day falls on a weekend or holiday, we will process the
redemption on the next business day. For plans set up before June 1, 2000, we
will continue to process redemptions on the 25th day of the month (or the
next business day) unless you instruct us to change the processing date.
Available processing dates currently are the 1st, 5th, 10th, 15th, 20th and
25th days of the month. When you sell your shares under a systematic
withdrawal plan, it is a taxable transaction.
Redeeming shares through a systematic withdrawal plan may reduce or exhaust
the shares in your account if payments exceed distributions received from the
fund. This is especially likely to occur if there is a market decline. If a
withdrawal amount exceeds the value of your account, your account will be
closed and the remaining balance in your account will be sent to you. Because
the amount withdrawn under the plan may be more than your actual yield or
income, part of the payment may be a return of your investment.
To discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment, we must receive instructions
from you at least three business days before a scheduled payment. The fund
may discontinue a systematic withdrawal plan by notifying you in writing and
will discontinue a systematic withdrawal plan automatically if all shares in
your account are withdrawn or if the fund receives notification of the
shareholder's death or incapacity.
II. The following paragraph is added to the section "General information" on
page 26:
There are special procedures for banks and other institutions that wish to
open multiple accounts. An institution may open a single master account by
filing one application form with the fund, signed by personnel authorized to
act for the institution. Individual sub-accounts may be opened when the
master account is opened by listing them on the application, or by providing
instructions to the fund at a later date. These sub-accounts may be
registered either by name or number. The fund's investment minimums apply to
each sub-account. The fund will send confirmation and account statements for
the sub-accounts to the institution.
Please keep this supplement for future reference.
