FVF Proxy Stkr
SUPPLEMENT DATED JANUARY 14, 1997
TO THE PROSPECTUS OF
FRANKLIN VALUEMARK FUNDS
DATED NOVEMBER 8, 1996
A. The Prospectus is amended by adding the following to the section entitled
"Precious Metals Fund," under "Fund Investment Objectives and Policies":
PROPOSAL TO CHANGE FUND OBJECTIVE AND CONCENTRATION POLICY. The Board of
Trustees (the "Board") of Franklin Valuemark Funds has approved for shareholder
consideration changes in the investment objective and industry concentration
policy of the Precious Metals Fund ("Fund") to those of a fund which invests
primarily in natural resources industries, changes in two related fundamental
investment policies, as well as election of trustees. The Board also approved a
change in the fund's name to the Natural Resources Securities Fund ("Natural
Resources Fund"), if shareholders approve the objective and concentration
policy change. Like the Fund, the Natural Resources Fund would seek capital
appreciation, with income as a secondary objective but it would invest, under
normal market conditions, at least 65% of its assets in securities of companies
in the natural resources sector, rather than the precious metals industry. The
natural resources sector includes companies in the gold and precious metals
industry, as well as companies in other natural resources industries such as
integrated oil; oil and gas exploration and production; steel and iron ore
production; aluminum production; forest products; farming products; paper
products; chemicals; building materials; energy services and technology;
environmental services; and energy generation and distribution. Companies in
this sector may own, produce, refine, process or market natural resources, or
provide support services for natural resources companies (e.g., develop
technologies or provide services, supplies or equipment directly related to the
production of natural resources).
Shareholders of record as of the close of business on January 21, 1997 are
entitled to vote at the April 4, 1997 shareholder meeting. The proposals would
take effect on May 1, 1997 or, if the shareholder meeting is postponed beyond
that date, on the date of approval by shareholders. Further information about
this and certain other proposals will be set forth in a proxy statement to be
furnished to shareholders within a reasonable time before the meeting date.
B. The second sentence in the sections entitled "Mutual Shares Securities Fund,
Foreign Investments" and "Mutual Discovery Securities Fund, Foreign
Investments," under "Fund Investment Objectives and Policies," is revised to
read as follows:
The Fund presently does not intend to invest more than 5% of its assets in
securities of issuers in developing markets, including Russia.
C. The section entitled "Utility Equity Fund, Foreign Investments," under "Fund
Investment Objectives and Policies," is revised by adding the following
sentence:
As a non-fundamental policy, the Fund will limit its investments in securities
of Russian issuers to 5% of total assets.
