SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No.)
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section.240-14a-11(c) or Section.240-
14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
Franklin Multi-Income Trust
(Name of Registrant as Specified In Its Charter)
Franklin Multi-Income Trust
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary material.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
[LOGO](R)
FRANKLIN(R)TEMPLETON(R)
FRANKLIN MULTI-INCOME TRUST
IMPORTANT SHAREHOLDER INFORMATION
These materials are for the annual shareholders' meeting scheduled for
October 7, 1999 at 3:00 p.m. Pacific time. They discuss the proposals to be
voted on at the meeting, and contain your proxy statement and proxy card. A
proxy card is, in essence, a ballot. When you vote your proxy, it tells us
how you wish to vote on important issues relating to your Fund. If you
complete and sign the proxy, we'll vote it exactly as you tell us. If you
simply sign the proxy, we'll vote it in accordance with the Trustees'
recommendations on pages 1 and 2 of the proxy statement.
WE URGE YOU TO SPEND A FEW MINUTES REVIEWING THE PROPOSALS IN THE PROXY
STATEMENT. THEN, FILL OUT THE PROXY CARD AND RETURN IT TO US SO THAT WE KNOW
HOW YOU WOULD LIKE TO VOTE. WHEN SHAREHOLDERS RETURN THEIR PROXIES PROMPTLY,
THE FUND MAY BE ABLE TO SAVE MONEY BY NOT HAVING TO CONDUCT ADDITIONAL
MAILINGS.
WE WELCOME YOUR COMMENTS. IF YOU HAVE ANY QUESTIONS, CALL FUND INFORMATION AT
1-800/DIAL BEN(R) (1-800/342-5236).
TELEPHONE AND INTERNET VOTING
FOR YOUR CONVENIENCE, YOU MAY BE ABLE TO VOTE BY TELEPHONE OR THROUGH THE
INTERNET, 24 HOURS A DAY. IF YOUR ACCOUNT IS ELIGIBLE, A CONTROL NUMBER AND
SEPARATE INSTRUCTIONS ARE ENCLOSED.
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A LETTER FROM THE CHAIRMAN
Dear Fellow Shareholders:
I am writing to request that you consider five matters that relate to the
Franklin Multi-Income Trust (the "Fund"). The Board of Trustees (the "Board")
of the Fund asks that you cast your vote in favor of:
1. Electing three Trustees;
2. Ratifying the appointment by the Trustees of PricewaterhouseCoopers LLP
as the independent auditors for the Fund for its current fiscal year;
3. Eliminating the Fund's fundamental investment restriction regarding
investment in other investment companies;
4. Amending the Fund's fundamental investment restriction regarding
lending; and
5. Granting proxyholders the authority to vote upon any other business that
may properly come before the annual meeting or any adjournments.
Each year, in accordance with legal requirements, the Fund, in connection
with or as part of its annual meeting, submits the election of Trustees and
the approval of the Fund's auditor to a shareholder vote. As in past years,
we urge you to confirm the Board's recommendations by electing the nominated
Trustees and ratifying the selection of the auditor.
We have also proposed amending or eliminating two of the Fund's fundamental
investment restrictions. We believe that the recommended changes will provide
additional investment opportunities to the Fund, as further described in the
attached proxy statement. We urge you to approve these proposals which are
designed to benefit all shareholders by providing the Fund with greater
flexibility in pursuing its investment objectives.
The proxy statement includes a question-and-answer format designed to provide
you with a simpler and more concise explanation of certain issues. Although
much of the information in the proxy statement is technical and required by
the various regulations that govern the Fund, we hope that this format will
be helpful to you.
Each shareholder's vote is important to the Fund. On behalf of the Trustees,
thank you in advance for considering these issues and for promptly returning
your proxy card.
Sincerely,
/s/ Charles B. Johnson
CHARLES B. JOHNSON
CHAIRMAN OF THE BOARD
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FRANKLIN MULTI-INCOME TRUST
NOTICE OF 1999 ANNUAL SHAREHOLDERS' MEETING
The Annual Shareholders' Meeting ("Meeting") of Franklin Multi-Income Trust
(the "Fund") will be held at the Fund's office, at 777 Mariners Island Blvd.,
San Mateo, California 94404 on October 7, 1999 at 3:00 p.m. Pacific time.
During the Meeting, shareholders of the Fund will vote on five proposals:
1. The election of three Trustees of the Fund;
2. To ratify the selection of PricewaterhouseCoopers LLP as independent
auditors for the Fund's fiscal year ending March 31, 2000;
3. To eliminate the Fund's fundamental investment restriction regarding
investment in other investment companies;
4. To amend the Fund's fundamental investment restriction regarding
lending; and
5. To grant the proxyholders the authority to vote upon any other business
that may properly come before the Meeting or any adjournments thereof.
The Board of Trustees has fixed August 17, 1999 as the record date for
determination of shareholders entitled to vote at the Meeting.
By Order of the Board of Trustees,
Deborah R. Gatzek
SECRETARY
San Mateo, California
Dated: September 1, 1999
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PLEASE SIGN AND PROMPTLY RETURN YOUR PROXY CARD IN THE SELF-ADDRESSED
ENVELOPE REGARDLESS OF THE NUMBER OF SHARES YOU OWN.
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FRANKLIN MULTI-INCOME TRUST
PROXY STATEMENT
o INFORMATION ABOUT VOTING
WHO IS ASKING FOR MY VOTE?
The Trustees of Franklin Multi-Income Trust (the "Fund") in connection with
the Annual Shareholders' Meeting to be held October 7, 1999 (the "Meeting"),
have asked that you vote on several matters.
WHO IS ELIGIBLE TO VOTE?
Shareholders of record at the close of business on August 17, 1999 are
entitled to be present and to vote at the Meeting or any adjourned meeting.
Each share of record is entitled to one vote on each matter presented at the
Meeting. The Notice of Meeting, the proxy card, and the proxy statement were
mailed to shareholders of record on or about September 1, 1999.
ON WHAT ISSUES AM I BEING ASKED TO VOTE?
You are being asked to vote on five proposals:
1. To elect three nominees to the position of Trustee;
2. To ratify the selection of PricewaterhouseCoopers LLP as independent
auditors of the Fund for the fiscal year ending March 31, 2000;
3. To eliminate the Fund's fundamental investment restriction regarding
investment in other investment companies;
4. To amend the Fund's fundamental investment restriction regarding
lending; and
5. To grant the proxyholders the authority to vote upon any other business
that may properly come before the Meeting or any adjournment thereof.
HOW DO THE FUND'S TRUSTEES RECOMMEND THAT I VOTE?
The Trustees unanimously recommend that you vote:
1. FOR the election of all nominees as Trustees;
2. FOR the ratification of the selection of PricewaterhouseCoopers LLP as
independent auditors for the Fund's fiscal year ending March 31, 2000;
3. FOR the elimination of the Fund's fundamental investment restriction
regarding investment in other investment companies;
4. FOR the amendment to the Fund's fundamental investment restriction
regarding lending; and
5. FOR the proxyholders to have discretion to vote on any other business as
may properly come before the Meeting or any adjournment thereof.
HOW DO I ENSURE THAT MY VOTE IS ACCURATELY RECORDED?
You may attend the Meeting and vote in person or you may complete and return
the proxy card. If you are eligible to vote by telephone or through the
internet, a control number and separate instructions are enclosed.
Proxy cards that are properly signed, dated and received at or prior to the
Meeting will be voted as specified. If you specify a vote for any of the
Proposals 1 through 4, your proxy will be voted as you indicated. If you
simply sign and date the proxy card, but don't specify a vote for any of the
Proposals 1 through 4, your shares will be voted IN FAVOR of the nominees for
Trustee (Proposal 1), IN FAVOR of ratifying the selection of
PricewaterhouseCoopers LLP as independent auditors (Proposal 2), IN FAVOR of
eliminating the Fund's fundamental investment restriction regarding
investment in other investment companies (Proposal 3), IN FAVOR of amending
the Fund's fundamental investment restriction regarding lending (Proposal 4),
and/or IN ACCORDANCE with the discretion of the persons named in the proxy
card as to any other matters that properly may come before the Meeting
(Proposal 5).
CAN I REVOKE MY PROXY?
You may revoke your proxy at any time before it is voted by forwarding a
revocation or later-dated proxy card to the Fund that is received at or prior
to the Meeting, or attending the Meeting and voting in person.
o THE PROPOSALS:
PROPOSAL 1: ELECTION OF TRUSTEES
WHO ARE THE NOMINEES AND TRUSTEES?
The Board is divided into three classes, each class having a term of three
years. Each year the term of office of one class expires. This year, the
terms of three Trustees are expiring. Frank H. Abbott, III, Harris J. Ashton,
and Gordon S. Macklin have been nominated for three-year terms, set to expire
at the 2002 Annual Shareholders' Meeting. These terms continue, however,
until successors are duly elected and qualified. The nominees are currently
members of the Board. In addition, all of the current nominees and Trustees
are also directors or trustees of other investment companies in the Franklin
Group of Funds(R) and/or the Templeton Group of Funds (collectively, the
"Franklin Templeton Group of Funds").
Certain Trustees of the Fund hold director and/or officer positions with
Franklin Resources, Inc. ("Resources") and its affiliates. Resources is a
publicly owned holding company. The principal shareholders are Charles B.
Johnson and Rupert H. Johnson, Jr., who own approximately 19% and 15%,
respectively, of Resources' outstanding shares. Resources is primarily
engaged, through its various subsidiaries, in providing investment
management, share distribution, transfer agent and administrative services to
a family of investment companies. Resources is a New York Stock Exchange,
Inc. ("NYSE") listed holding company (NYSE: BEN). Charles E. Johnson, Vice
President of the Fund, and Gregory E. Johnson, Vice President of the Fund,
are the sons and nephews, respectively, of brothers Charles B. Johnson,
Chairman of the Board and Trustee of the Fund, and Rupert H. Johnson, Jr.,
Vice President and Trustee of the Fund.
Each nominee is currently eligible and has consented to serve if elected. If
any of the nominees should become unavailable, the persons named in the proxy
will vote in their discretion for another person or other persons who may be
nominated as Trustees.
Listed below, for each nominee and current Trustee, is a brief description of
his recent professional experience, and his ownership of shares of the Fund,
and shares of all funds in the Franklin Templeton Group of Funds.
SHARES BENEFICIALLY
FUND SHARES OWNED IN THE
BENEFICIALLY OWNED FRANKLIN TEMPLETON
AND % OF TOTAL GROUP OF FUNDS
NAME AND PRINCIPAL OCCUPATION OUTSTANDING ON (INCLUDING THE FUND)
DURING PAST FIVE YEARS AND AGE JUNE 30, 1999 AS OF JUNE 30, 1999
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NOMINEES TO SERVE UNTIL THE 2002 ANNUAL SHAREHOLDERS' MEETING
Frank H. Abbott, III 521** 583,368
TRUSTEE SINCE 1989
President and Director, Abbott Corporation (an investment company); director
or trustee, as the case may be, of 27 of the investment companies in the
Franklin Templeton Group of Funds; and FORMERLY, Director, MotherLode Gold
Mines Consolidated (gold mining) (until 1996) and Vacu-Dry Co. (food
processing) (until 1996). Age 78.
SHARES BENEFICIALLY
FUND SHARES OWNED IN THE
BENEFICIALLY OWNED FRANKLIN TEMPLETON
AND % OF TOTAL GROUP OF FUNDS
NAME AND PRINCIPAL OCCUPATION OUTSTANDING ON (INCLUDING THE FUND)
DURING PAST FIVE YEARS AND AGE JUNE 30, 1999 AS OF JUNE 30, 1999
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NOMINEES TO SERVE UNTIL THE 2002 ANNUAL SHAREHOLDERS' MEETING (CONT.)
Harris J. Ashton 500** 1,615,494
TRUSTEE SINCE 1989
Director, RBC Holdings, Inc. (bank holding company) and Bar-S Foods (meat
packing company); director or trustee, as the case may be, of 48 of the
investment companies in the Franklin Templeton Group of Funds; and FORMERLY,
President, Chief Executive Officer and Chairman of the Board, General Host
Corporation (nursery and craft centers) (until 1998). Age 67.
Gordon S. Macklin 1,800** 246,141
TRUSTEE SINCE 1992
Director, Fund American Enterprises Holdings, Inc. (holding company), Martek
Biosciences Corporation, MCI WorldCom (information services), MedImmune, Inc.
(biotechnology), Spacehab, Inc. (aerospace services) and Real 3D (software);
director or trustee, as the case may be, of 48 of the investment companies in
the Franklin Templeton Group of Funds; and FORMERLY, Chairman, White River
Corporation (financial services) and Hambrecht and Quist Group (investment
banking), and President, National Association of Securities Dealers, Inc. Age
71.
TRUSTEES SERVING UNTIL 2001 ANNUAL SHAREHOLDERS' MEETING
*Edward B. Jamieson None 19,724
PRESIDENT AND TRUSTEE SINCE 1993
Executive Vice President and Portfolio Manager, Franklin Advisers, Inc.; and
officer and trustee, as the case may be, of four of the investment companies in
the Franklin Templeton Group of Funds. Age 51.
SHARES BENEFICIALLY
FUND SHARES OWNED IN THE
BENEFICIALLY OWNED FRANKLIN TEMPLETON
AND % OF TOTAL GROUP OF FUNDS
NAME AND PRINCIPAL OCCUPATION OUTSTANDING ON (INCLUDING THE FUND)
DURING PAST FIVE YEARS AND AGE JUNE 30, 1999 AS OF JUNE 30, 1999
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TRUSTEES SERVING UNTIL 2001 ANNUAL SHAREHOLDERS' MEETING (CONT.)
*Charles B. Johnson 4,130** 2,203,689
CHAIRMAN OF THE BOARD SINCE 1993 AND TRUSTEE SINCE 1989
President, Chief Executive Officer and Director, Franklin Resources, Inc.;
Chairman of the Board and Director, Franklin Advisers, Inc., Franklin Investment
Advisory Services, Inc. and Franklin Templeton Distributors, Inc.; Director,
Franklin/Templeton Investor Services, Inc. and Franklin Templeton Services,
Inc.; officer and/or director or trustee, as the case may be, of most of the
other subsidiaries of Franklin Resources, Inc. and of 49 of the investment
companies in the Franklin Templeton Group of Funds. Age 66.
*Rupert H. Johnson, Jr. 1,000** 16,297,751
SENIOR VICE PRESIDENT SINCE 1992 AND TRUSTEE SINCE 1989
Executive Vice President and Director, Franklin Resources, Inc. and Franklin
Templeton Distributors, Inc.; President and Director, Franklin Advisers, Inc.
and Franklin Investment Advisory Services, Inc.; Senior Vice President, Franklin
Advisory Services, LLC; Director, Franklin/Templeton Investor Services, Inc.;
and officer and/or director or trustee, as the case may be, of most of the other
subsidiaries of Franklin Resources, Inc. and of 52 of the investment companies
in the Franklin Templeton Group of Funds. Age 59.
TRUSTEES SERVING UNTIL 2000 ANNUAL SHAREHOLDERS' MEETING
S. Joseph Fortunato 100** 472,398
TRUSTEE SINCE 1989
Member of the law firm of Pitney, Hardin, Kipp & Szuch; and director or trustee,
as the case may be, of 50 of the investment companies in the Franklin Templeton
Group of Funds. Age 67.
SHARES BENEFICIALLY
FUND SHARES OWNED IN THE
BENEFICIALLY OWNED FRANKLIN TEMPLETON
AND % OF TOTAL GROUP OF FUNDS
NAME AND PRINCIPAL OCCUPATION OUTSTANDING ON (INCLUDING THE FUND)
DURING PAST FIVE YEARS AND AGE JUNE 30, 1999 AS OF JUNE 30, 1999
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TRUSTEES SERVING UNTIL 2000 ANNUAL SHAREHOLDERS' MEETING (CONT.)
Frank W.T. LaHaye 1,000** 748,366
TRUSTEE SINCE 1989
General Partner, Miller & LaHaye, which is the General Partner of Peregrine
Ventures II (venture capital firm); director or trustee, as the case may be,
of 27 of the investment companies in the Franklin Templeton Group of Funds;
and FORMERLY, Director, Fischer Imaging Corporation (medical imaging
systems), Digital Transmission Systems, Inc. (wireless communications) and
Quarterdeck Corporation (software firm), and General Partner, Peregrine
Associates, which was the General Partner of Peregrine Ventures (venture
capital firm). Age 70.
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*Edward B. Jamieson, Charles B. Johnson and Rupert H. Johnson, Jr. are
"interested persons" of the Fund as defined in the Investment Company Act of
1940, as amended, (the "1940 Act"). The 1940 Act limits the percentage of
interested persons that can comprise a fund's board of trustees. Mr. Edward
B. Jamieson is an interested person due to his employment affiliation with
Resources. Mr. Charles B. Johnson and Mr. Rupert H. Johnson, Jr. are
interested persons due to their ownership interest in Resources. The
remaining Trustees of the Fund are not interested persons of the Fund (the
"Independent Trustees").
**Less than 1% of the outstanding shares of the Fund.
HOW OFTEN DO THE TRUSTEES MEET AND WHAT ARE THEY PAID?
The role of the Trustees is to provide general oversight of the Fund's
business, and to ensure that the Fund is operated for the benefit of
shareholders. The Trustees anticipate meeting at least 11 times during the
current fiscal year to review the operations of the Fund and Fund's
investment performance. The Trustees also oversee the services furnished to
the Fund by Franklin Advisers, Inc., (the Fund's "Investment Manager"), and
various other service providers. The Fund pays the Independent Trustees $60
per month plus $40 per meeting attended. Board members who serve on the Audit
Committee of the Fund and other funds in the Franklin Templeton Group of
Funds receive a flat fee of $2,000 per committee meeting attended, a portion
of which is allocated to the Fund. Members of a committee are not compensated
for any committee meeting held on the day of a board meeting.
During the fiscal year ended March 31, 1999 there were 11 meetings of the
Board and two meetings of the Audit Committee. Each of the Trustees attended
at least 75% of the total number of meetings of the Board. There was 100%
attendance at the meetings of the Audit Committee.
Certain Trustees and Officers of the Fund are shareholders of Resources and
may be deemed to receive indirect remuneration due to their participation in
the management fees and other fees received from the Franklin Templeton Group
of Funds by the Investment Manager and its affiliates. The Investment Manager
or its affiliates pay the salaries and expenses of the Officers. No pension
or retirement benefits are accrued as part of Fund expenses.
NUMBER OF
BOARDS WITHIN THE
FRANKLIN TEMPLETON TOTAL FEES
AGGREGATE GROUP OF FUNDS ON RECEIVED FROM THE
COMPENSATION WHICH TRUSTEE FRANKLIN TEMPLETON
NAME OF TRUSTEE FROM THE FUND* SERVES** GROUP OF FUNDS***
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Frank H. Abbott, III $1,001 27 $159,051
Harris J. Ashton 1,061 48 361,157
S. Joseph Fortunato 1,010 50 367,835
Frank W.T. LaHaye 1,081 27 163,753
Gordon S. Macklin 1,061 48 361,157
*For the fiscal year ended March 31, 1999. During the period from April 1,
1998 through May 31, 1998, fees at the rate of $100 per month plus $50 per
meeting attended were in effect.
**We base the number of boards on the number of registered investment
companies in the Franklin Templeton Group of Funds. This number does not
include the total number of series or funds within each investment company
for which the Board members are responsible. The Franklin Templeton Group of
Funds currently includes 54 registered investment companies, with
approximately 161 U.S. based funds or series.
***For the calendar year ended December 31, 1998.
The table above indicates the total fees paid to the Independent Trustees by
the Fund individually, and by all of the funds in the Franklin Templeton
Group of Funds. These Independent Trustees also serve as directors or
trustees of other investment companies in the Franklin Templeton Group of
Funds, many of which hold meetings at different dates and times. The Trustees
believe that having the same individuals serving on the boards of many of the
funds in the Franklin Templeton Group of Funds enhances the ability of each
fund to obtain, at a relatively modest cost to each separate fund, the
services of high caliber, experienced and knowledgeable Trustees who can more
effectively oversee the management of the funds.
Directors and trustees historically have followed a policy of having
substantial investments in one or more of the funds in the Franklin Templeton
Group of Funds, as is consistent with their individual financial goals. In
February 1998, this policy was formalized through adoption of a requirement
that each director or trustee invest one-third of fees received for serving
as a director or trustee of a Templeton fund in shares of one or more
Templeton funds, and one-third of fees received for serving as a director or
trustee of a Franklin fund in shares of one or more Franklin funds, until the
value of such investments equals or exceeds five times the annual fees paid
such director or trustee. Investments in the name of family members or
entities controlled by a director or trustee constitute fund holdings of such
director or trustee for purposes of this policy, and a three year phase-in
period applies to such investment requirements for newly elected directors or
trustees. In implementing such policy, a director or trustee's fund holdings
existing on February 27, 1998, are valued as of such date with subsequent
investments valued at cost.
WHO ARE THE EXECUTIVE OFFICERS OF THE FUND?
Officers of the Fund are appointed by the Trustees and serve at the pleasure
of the Board. Listed below, for each Executive Officer, is a brief
description of his or her recent professional experience:
NAME AND OFFICES WITH THE FUND PRINCIPAL OCCUPATION DURING PAST FIVE YEARS AND
AGE
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Harmon E. Burns
VICE PRESIDENT SINCE 1989
Executive Vice President and Director, Franklin Resources, Inc., Franklin
Templeton Distributors, Inc. and Franklin Templeton Services, Inc.; Executive
Vice President, Franklin Advisers, Inc.; Director, Franklin Investment
Advisory Services, Inc. and Franklin/Templeton Investor Services, Inc.; and
officer and/or director or trustee, as the case may be, of most of the other
subsidiaries of Franklin Resources, Inc. and of 52 of the investment
companies in the Franklin Templeton Group of Funds. Age 54.
Martin L. Flanagan
VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER SINCE 1995
Senior Vice President and Chief Financial Officer, Franklin Resources, Inc.,
Franklin/Templeton Investor Services, Inc. and Franklin Mutual Advisers, LLC;
Executive Vice President, Chief Financial Officer and Director, Templeton
Worldwide, Inc.; Executive Vice President, Chief Operating Officer and
Director, Templeton Investment Counsel, Inc.; Executive Vice President and
Chief Financial Officer, Franklin Advisers, Inc.; Chief Financial Officer,
Franklin Advisory Services, LLC and Franklin Investment Advisory Services,
Inc.; President and Director, Franklin Templeton Services, Inc.; officer
and/or director of some of the other subsidiaries of Franklin Resources,
Inc.; and officer and/or director or trustee, as the case may be, of 52 of
the investment companies in the Franklin Templeton Group of Funds. Age 39.
NAME AND OFFICES WITH THE FUND PRINCIPAL OCCUPATION DURING PAST FIVE YEARS AND
AGE
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Deborah R. Gatzek
VICE PRESIDENT SINCE 1992 AND
SECRETARY SINCE 1989
Senior Vice President and General Counsel, Franklin Resources, Inc.; Senior
Vice President, Franklin Templeton Services, Inc. and Franklin Templeton
Distributors, Inc.; Executive Vice President, Franklin Advisers, Inc.; Vice
President, Franklin Advisory Services, LLC and Franklin Mutual Advisers, LLC;
Vice President, Chief Legal Officer and Chief Operating Officer, Franklin
Investment Advisory Services, Inc.; and officer of 53 of the investment
companies in the Franklin Templeton Group of Funds. Age 50.
Edward B. Jamieson
PRESIDENT SINCE 1992
See Proposal 1, "Election of Trustees."
Charles B. Johnson
CHAIRMAN OF THE BOARD SINCE 1993
See Proposal 1, "Election of Trustees."
Charles E. Johnson
VICE PRESIDENT SINCE 1989
Senior Vice President and Director, Franklin Resources, Inc.; Senior Vice
President, Franklin Templeton Distributors, Inc.; President and Director,
Templeton Worldwide, Inc.; Chairman and Director, Templeton Investment
Counsel, Inc.; Vice President, Franklin Advisers, Inc.; officer and/or
director of some of the other subsidiaries of Franklin Resources, Inc.; and
officer and/or director or trustee, as the case may be, of 33 of the
investment companies in the Franklin Templeton Group of Funds. Age 43.
Gregory E. Johnson
VICE PRESIDENT SINCE 1989
President, Franklin Templeton Distributors, Inc.; and Vice President,
Franklin Resources, Inc. and Franklin Advisers, Inc. Age 38.
Rupert H. Johnson, Jr.
SENIOR VICE PRESIDENT SINCE 1992
See Proposal 1, "Election of Trustees."
Diomedes Loo-Tam
TREASURER AND PRINCIPAL ACCOUNTING OFFICER SINCE 1995
Senior Vice President, Franklin Templeton Services, Inc.; and officer of 32
of the investment companies in the Franklin Templeton Group of Funds. Age 60.
Edward V. McVey
VICE PRESIDENT SINCE 1989
Senior Vice President and National Sales Manager, Franklin Templeton
Distributors, Inc.; and officer of 28 of the investment companies in the
Franklin Templeton Group of Funds. Age 62.
R. Martin Wiskemann
VICE PRESIDENT SINCE 1989
Senior Vice President, Portfolio Manager and Director, Franklin Advisers,
Inc.; Senior Vice President, Franklin Management, Inc.; Vice President and
Director, ILA Financial Services, Inc.; and officer and/or director or
trustee, as the case may be, of 15 of the investment companies in the
Franklin Templeton Group of Funds. Age 72.
THE BOARD OF TRUSTEES OF THE FUND UNANIMOUSLY RECOMMENDS
THAT YOU APPROVE PROPOSAL 1
PROPOSAL 2: TO RATIFY THE SELECTION OF INDEPENDENT AUDITORS
HOW ARE INDEPENDENT AUDITORS SELECTED?
The Board of Trustees has a standing Audit Committee consisting of Messrs.
Abbott and LaHaye, both of whom are Independent Trustees. The Audit Committee
reviews audit procedures and results and considers any matters arising from
an audit to be brought to the attention of the Trustees as a whole with
respect to the accounting of the Fund, its internal accounting controls, its
operational procedures and submits a recommendation to the full Board of
Trustees as to the selection of independent auditors.
WHICH INDEPENDENT AUDITORS DID THE BOARD SELECT?
For the fiscal year ending March 31, 2000, the Board, including all of the
Independent Trustees, selected as auditors the firm of PricewaterhouseCoopers
LLP, 333 Market Street, San Francisco, CA 94105. Coopers & Lybrand L.L.P.
served as the independent auditors for the Fund since its inception in 1989
until 1998. PricewaterhouseCoopers LLP is the successor entity to a 1998
combination of Coopers & Lybrand L.L.P. with Price Waterhouse LLP. The
auditors give an opinion on the financial statements in the Fund's Annual
Report to Shareholders. PricewaterhouseCoopers LLP has advised the Fund that
neither the firm nor any of its members have any material direct or indirect
financial interest in the Fund.
Representatives of PricewaterhouseCoopers LLP are not expected to be present
at the Meeting.
THE BOARD OF TRUSTEES OF THE FUND UNANIMOUSLY RECOMMENDS
THAT YOU APPROVE PROPOSAL 2
PROPOSAL 3: TO ELIMINATE THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION
REGARDING INVESTMENT IN OTHER INVESTMENT COMPANIES
WHAT IS THE CURRENT RESTRICTION AND WHY IS THE BOARD RECOMMENDING THAT THE
RESTRICTION BE ELIMINATED?
The Fund is subject to certain investment restrictions which govern the
Fund's investment activities. Under the 1940 Act, certain investment
restrictions that are designated as fundamental, either because they are
required to be so under the 1940 Act, or a Fund elects to treat them as such,
can only be changed by a shareholder vote.
Currently, investment restriction number 8, which is fundamental, states that
the Fund may not:
Acquire securities of other investment companies in an amount exceeding
the limitations set forth in the 1940 Act and the rules thereunder,
except as part of a merger, consolidation or other plan of
reorganization.
After the Fund was formed in 1989, legal and regulatory requirements
applicable to investment companies changed. For example, certain restrictions
deriving from state laws and regulations are no longer relevant as the
National Securities Markets Improvement Act of 1996 ("NSMIA") eliminated the
states' ability to substantively regulate investment companies. As a result
of NSMIA, the Fund's current restriction on investing in other investment
companies, which was included because of a state law requiring a stated
policy in this regard, is no longer legally required.
The Board has determined that eliminating this restriction: (1) is consistent
with the federal securities laws; (2) will permit the Fund to take advantage
of investments in affiliated money market funds under an SEC order, as
described below; and (3) will conform the Fund's restrictions with
standardized investment restrictions adopted by other Franklin and Templeton
funds. By both standardizing and reducing the total number of investment
restrictions that can be changed only by a shareholder vote, the Board
believes that the Fund will be able to minimize the costs and delays
associated with holding future shareholder meetings to revise fundamental
policies that become outdated or inappropriate. In light of the above
considerations, the Board has determined that eliminating this investment
restriction is in the best interests of the Fund's shareholders.
WHAT EFFECT WILL ELIMINATING THIS RESTRICTION HAVE ON THE FUND?
The current investment restriction incorporates into it the current state of
the federal securities law requirements relating to an investment by an
investment company in shares of other investment companies. Thus, as a
general matter, elimination of restriction number 8 should not have an impact
on the day to day management of the Fund, as the 1940 Act restrictions will
still apply to the Fund. With respect to cash management, however, the
Franklin Templeton Group of Funds, including the Fund, has obtained an
exemptive order from the SEC (the "Cash Sweep Order") to permit the funds to
invest their uninvested cash in one or more Franklin or Templeton money
market funds. Eliminating the Fund's current restriction on investing in
other investment companies will permit the Fund to take advantage of the
investment opportunities presented by the Cash Sweep Order, since the Cash
Sweep Order contemplates relief from the 1940 Act restrictions relating to
the permissible percentage of investments in other investment companies.
Absent the elimination of the Fund's restriction number 8, that restriction
would prohibit the Fund from taking full advantage of the relief granted in
the Cash Sweep Order.
The Cash Sweep Order permits the Fund to invest a higher percentage of its
assets in affiliated Franklin or Templeton money market funds than would
normally be allowed under the 1940 Act, subject to certain conditions imposed
by the SEC staff. At the end of each day, the Fund typically has cash
available for investment, but often may not have enough cash to permit it to
make meaningful investments directly in high quality and higher yielding
money market instruments. By investing its uninvested cash in shares of the
Franklin or Templeton money market funds, the Fund would be able to invest
its assets in a fund which invests in higher yielding instruments than may
otherwise be available to the Fund for direct short-term investments of
uninvested cash balances. The Fund will only invest in affiliated money
market funds to the extent permitted by the parameters of the Cash Sweep
Order.
WHAT ARE THE RISKS, IF ANY, IN ELIMINATING THIS INVESTMENT RESTRICTION?
The Board does not anticipate that eliminating this restriction will result
in any additional risk to the Fund. Although the Fund's current restriction,
as drafted, is no longer legally required, the Fund's ability to invest in
other investment companies will continue to be subject to the limitations of
the 1940 Act or any exemptive orders, like the Cash Sweep Order, granted
under the 1940 Act with their accompanying conditions as imposed by the SEC
staff.
In addition, the Fund's purchases and redemptions of money market fund shares
would not be subject to a sales load, redemption fee, or distribution fee
adopted in accordance with Rule 12b-1.
THE BOARD OF TRUSTEES OF THE FUND UNANIMOUSLY RECOMMENDS THAT YOU APPROVE
PROPOSAL 3
PROPOSAL 4: TO AMEND THE FUND'S FUNDAMENTAL INVESTMENT RESTRICTION REGARDING
LENDING
WHAT IS THE CURRENT RESTRICTION AND WHY IS THE BOARD RECOMMENDING THAT THE
RESTRICTION BE AMENDED?
The Board is recommending that shareholders approve a change to the Fund's
fundamental investment restriction regarding lending. The Board has
determined that amending this restriction: (1) is consistent with the federal
securities laws; (2) will permit the Fund to take advantage of additional
lending opportunities under a proposed SEC exemptive order; and (3) will
conform the Fund's restrictions with standardized investment restrictions
adopted by other Franklin and Templeton funds.
Currently, investment restriction 5, which is fundamental, states that the
Fund may not:
Make loans to other persons except (i) through the lending of its
portfolio securities, (ii) through the purchase of debt securities, loan
participations and/or engaging in direct corporate loans in accordance
with its investment objectives and policies, and (iii) to the extent the
entry into a repurchase agreement is deemed to be a loan.
The Board believes that the proposed amendment to the Fund's lending
restriction is in the best interests of the Fund's shareholders and should be
modified because the proposed lending restriction will provide the Fund with
greater investment management flexibility than the current lending
restriction. The new lending restriction will grant the Fund additional
authority to loan cash to affiliated investment companies, pursuant to the
terms of a proposed SEC order, as described below.
WHAT EFFECT WILL THIS AMENDMENT HAVE ON THE FUND'S INVESTMENT POLICIES?
As a general matter, amending this restriction should not have an impact on
the day to day management of the Fund, as the 1940 Act restrictions on
lending will still apply to the Fund, and the proposed modification merely
carves out certain limited situations from the existing prohibition. This
carve-out would permit the Fund to take advantage of certain regulatory
relief available to the Fund from time to time. For example, the Franklin
Templeton Group of Funds, including the Fund, has requested an exemptive
order from the SEC (the "Lending Order") that will permit the Fund to lend
cash to other Franklin and Templeton funds. If the Lending Order is approved,
the new restriction will permit the Fund, under certain conditions, to lend
cash to other Franklin or Templeton funds at rates higher than those which
the Fund would receive if the Fund loaned cash to banks through short-term
lendings such as repurchase agreements. The ability to lend cash to
affiliated investment companies would provide additional investment
opportunities to the Fund.
In addition, the standardization of the current lending restriction is
expected to enable all Franklin and Templeton funds to operate more
efficiently, and to more easily monitor compliance with investment
restrictions. If the proposed lending restriction is not approved, the Fund
would be prohibited from taking advantage of either the Lending Order, or
other future exemptive orders granted under the 1940 Act.
WHAT ARE THE RISKS, IF ANY, IN AMENDING THIS INVESTMENT RESTRICTION?
The Board does not anticipate that the Fund will incur any additional risk as
a result of amending the Fund's lending restriction. The adoption of the
restriction as modified would not affect the Fund's current lending
limitations, but it would permit the Fund to lend cash to affiliated
investment companies in accordance with the Lending Order. Although any loan
involves certain risk that the borrower may not repay the loan, management of
the Fund believes that increased lending flexibility will not materially
increase the risk to which the Fund is currently subject. Further, any order
granted would be subject to certain conditions imposed by the SEC staff.
WHAT IS THE PROPOSED AMENDMENT TO THE FUND'S INVESTMENT RESTRICTION?
If approved by the shareholders, restriction number 5 will be amended to
state that the Fund may not:
Make loans to other persons except (a) through the lending of its
portfolio securities, (b) through the purchase of debt securities, loan
participations and/or engaging in direct corporate loans in accordance
with its investment objectives and policies, and (c) to the extent the
entry into a repurchase agreement is deemed to be a loan. The fund may
also make loans to affiliated investment companies to the extent
permitted by the 1940 Act or any exemptions therefrom which may be
granted by the U.S. Securities and Exchange Commission. (new language in
italics).
THE BOARD OF TRUSTEES OF THE FUND UNANIMOUSLY RECOMMENDS THAT YOU APPROVE
PROPOSAL 4
PROPOSAL 5: OTHER BUSINESS
The Trustees do not intend to bring any matters before the Meeting other than
Proposals 1, 2, 3 and 4 and are not aware of any other matters to be brought
before the Meeting by others. If any other matters do properly come before
the Meeting, the persons named in the enclosed proxy will use their best
judgment in voting on such matters.
o INFORMATION ABOUT THE FUND
THE INVESTMENT MANAGER. Franklin Advisers, Inc. ("Advisers"), 777 Mariners
Island Blvd., San Mateo, California 94404 serves as the Fund's investment
manager. Advisers is a wholly owned subsidiary of Resources, a publicly owned
holding company.
THE FUND ADMINISTRATOR. Under an agreement with Advisers, Franklin Templeton
Services, Inc. ("FT Services"), whose principal address is also 777 Mariners
Island Blvd., San Mateo, CA 94404, provides certain administrative services
and facilities for the Fund. FT Services is a wholly owned subsidiary of
Resources.
THE TRANSFER AGENT. The transfer agent, registrar and dividend disbursement
agent for the Fund is The First Data Investor Services Group, P.O. Box 8030,
Boston, MA 02266-8030.
THE CUSTODIAN. The Bank of New York, Mutual Funds Division, 90 Washington
Street, New York, NY 10286, acts as custodian of the Fund's securities and
other assets.
REPORTS TO SHAREHOLDERS AND FINANCIAL STATEMENTS. The Fund's last audited
financial statements and annual report, dated March 31, 1999, are available
free of charge. To obtain a copy, please call 1-800/DIAL BEN(R) or forward a
written request to Franklin/Templeton Investor Services, Inc., 777 Mariners
Island Blvd, P.O. Box 7777, San Mateo, CA 94403-7777.
PRINCIPAL SHAREHOLDERS. As of August 17, 1999, the Fund had 5,857,600 shares
outstanding and total net assets of $238,580,933. The Fund's shares are
listed on the NYSE (symbol: FMI ). From time to time, the number of shares
held in "street name" accounts of various securities dealers for the benefit
of their clients may exceed 5% of the total shares outstanding. To the
knowledge of the Fund's management, as of August 17, 1999, there were no
other entities holding beneficially or of record more than 5% of the Fund's
outstanding shares.
In addition, to the knowledge of the Fund's management, as of June 30, 1999,
no Trustee of the Fund owned 1% or more of the outstanding shares of the
Fund, and the Officers and Trustees of the Fund owned, as a group, less than
1% of the outstanding shares of the Fund.
o FURTHER INFORMATION ABOUT VOTING AND THE MEETING
SOLICITATION OF PROXIES. The cost of soliciting these proxies will be borne
by the Fund. The Fund reimburses brokerage firms and others for their
expenses in forwarding proxy material to the beneficial owners and soliciting
them to execute proxies. The Fund has engaged Shareholder Communications
Corporation to solicit proxies from brokers, banks, other institutional
holders and individual shareholders for an approximate fee, including
out-of-pocket expenses, ranging between $11,868 and $16,466. The Fund expects
that the solicitation will be primarily by mail, but also may include
telephone, telecopy or oral solicitations. The Fund does not reimburse
Trustees and Officers of the Fund, or regular employees and agents of
Advisers involved in the solicitation of proxies. The Fund intends to pay all
costs associated with the solicitation and the Meeting.
In addition to solicitations by mail, some of the Officers and employees of
the Fund, Advisers and its affiliates, without extra compensation, may
conduct additional solicitations by telephone, personal interviews and other
means.
VOTING BY BROKER-DEALERS. The Fund expects that, before the Meeting,
broker-dealer firms holding shares of the Fund in "street name" for their
customers will request voting instructions from their customers and
beneficial owners. If these instructions are not received by the date
specified in the broker-dealer firms' proxy solicitation materials, the Fund
understands that NYSE Rules permit the broker-dealers to vote on the items to
be considered at the Meeting on behalf of their customers and beneficial
owners. Certain broker-dealers may exercise discretion over shares held in
their name for which no instructions are received by voting those shares in
the same proportion as they vote shares for which they received instructions.
QUORUM. Forty percent of the shares entitled to vote, present in person or
represented by proxy, constitutes a quorum at the Meeting. The shares over
which broker-dealers have discretionary voting power, the shares that
represent "broker non-votes" (i.e., shares held by brokers or nominees as to
which: (i) instructions have not been received from the beneficial owners or
persons entitled to vote and (ii) the broker or nominee does not have
discretionary voting power on a particular matter), and the shares whose
proxies reflect an abstention on any item are all counted as shares present
and entitled to vote for purposes of determining whether the required quorum
of shares exists.
REQUIRED VOTE. Provided that a quorum is present, Proposal 1, the election of
Trustees, requires that the three nominees receiving the greatest number of
votes cast at the Meeting will be elected. All voting rights are
non-cumulative, which means that the holders of more than 50% of the shares
voting for the election of Trustees can elect 100% of such Trustees if they
choose to do so, and in such event, the holders of the remaining shares
voting will not be able to elect any Trustees. Proposal 2, ratification of
the selection of independent auditors, requires the affirmative vote of a
majority of the Fund's shares present and voting on the Proposal at the
Meeting. Proposals 3 and 4, changes to investment restrictions, require the
affirmative vote of the lesser of: (i) more than 50% of the outstanding
voting securities of the Fund or (ii) 67% or more of the voting securities of
the Fund present at the meeting, if the holders of more than 50% of the
outstanding voting securities are present or represented by proxy. Proposal
5, for the proxyholders to have discretion to vote on any other business that
may properly come before the meeting requires the affirmative vote of a
majority of the Fund's shares present and voting on the Proposal at the
Meeting. Abstentions and broker non-votes will be treated as votes not cast
and, therefore, will not be counted for purposes of obtaining approval of
each Proposal.
ADJOURNMENT. Whether or not a quorum is present, if sufficient votes in favor
of the Proposals are not received by the date of the Meeting, the persons
named in the enclosed proxy may propose one or more adjournments of the
Meeting for a period or periods of not more than 60 days from the date of the
original Meeting. This will permit further solicitation of proxies, even if a
quorum is present. Any adjournment will require the affirmative vote of a
majority of the votes cast upon the question of adjourning to another date
and time, in person or by proxy, at the session of the Meeting to be
adjourned. The persons named as proxies will vote in their discretion on
questions of adjournment those shares for which proxies have been received
that grant discretionary authority to vote on matters that may properly come
before the Meeting. The costs of any such additional solicitation and of any
adjourned session would be paid by the Fund.
SHAREHOLDER PROPOSALS. The Fund anticipates that its next annual
shareholders' meeting will be held in September, 2000. Shareholder proposals
to be presented at the next annual meeting must be received at the Fund's
offices, 777 Mariners Island Boulevard, San Mateo, CA 94404, no later than
April 2, 2000 in order to be included in the Fund's proxy statement and proxy
card relating to that meeting and presented at that meeting. Submission of a
proposal by a shareholder does not guarantee that the proposal will be
included in the proxy statement. A shareholder who wishes to make a proposal
at the 2000 annual shareholders' meeting without including the proposal in
the Fund's proxy statement should notify the Fund at the Fund's offices, of
such proposal by June 17, 2000. If a shareholder fails to give notice by this
date, then the persons named as proxies in the proxies solicited by the Board
for the 2000 annual shareholders' meeting may exercise discretionary voting
power with respect to any such proposal.
By order of the Board of Trustees,
Deborah R. Gatzek
Secretary
Dated: September 1, 1999
San Mateo, California
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PROXY
FRANKLIN MULTI-INCOME TRUST
ANNUAL SHAREHOLDERS' MEETING - OCTOBER 7, 1999
The undersigned hereby revokes all previous proxies for his shares and appoints
Harmon E. Burns, Rupert, H. Johnson, Jr., Deborah R. Gatzek, and Leiann Nuzum,
and each of them, proxies of the undersigned with full power of substitution to
vote all shares of Franklin Multi-Income Trust (the "Fund"), which the
undersigned is entitled to vote at the Fund's Annual Meeting to be held at 777
Mariners Island Blvd., San Mateo, California 94404 at 3:00 p.m. Pacific time on
the 7th day of October, 1999, including any adjournments thereof, upon the
matters set forth on the reverse side.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES. IT WILL BE VOTED AS
SPECIFIED. IF NO SPECIFICATION IS MADE, THIS PROXY SHALL BE VOTED IN FAVOR OF
PROPOSAL 1 (INCLUDING ALL NOMINEES FOR TRUSTEES), 2, 3, AND 4, AND WITHIN THE
DISCRETION OF THE PROXYHOLDERS AS TO ANY OTHER MATTER PURSUANT TO PROPOSAL 5.
<TABLE>
<CAPTION>
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
X PLEASE MARK
VOTES AS IN
THIS EXAMPLE.
THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE IN FAVOR OF PROPOSALS 1-4.
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
FOR AGAINST ABSTAIN
- ----------------------------------------------------------------------------------------------------
1. Election of three Trustees of 2. To ratify the [ ] [ ] [ ]
the Fund selection of
PricewaterhouseCoopers
NOMINEES: Frank H. Abbott, III, LLP as independent
Harris J. Ashton and auditors for the
Gordon S. Macklin Fund's fiscal year
ending March 31,
2000.
- ----------------------------------------------------------------------------------------------------
[ ] FOR ALL [ ] WITHHOLD [ ]ABSTAIN 3. To eliminate [ ] [ ] [ ]
NOMINEES AUTHORITY the Fund's
TO VOTE FOR fundamental
ALL investment
NOMINEES restriction
LISTED AB0VE regarding
investment in other
investment
companies.
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[ ] FOR ALL MARK [ ] 4. To amend the [ ] [ ] [ ]
NOMINEES HERE FOR Fund's fundamental
EXCEPT AS ADDRESS investment
NOTED CHANGE restriction
ABOVE AND NOTE regarding lending.
BELOW
- ----------------------------------------------------------------------------------------------------
5. To grant [ ] [ ] [ ]
the proxyholders
the authority to
vote upon any other
business that may
properly come
before the Meeting
or any adjournments
thereof.
- ----------------------------------------------------------------------------------------------------
PLEASE SIGN AND PROMPTLY RETURN IN THE
ACCOMPANYING ENVELOPE. NO POSTAGE REQUIRED IF
MAILED IN THE U.S.
- ----------------------------------------------------------------------------------------------------
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME
APPEARS ON THE PROXY. IF SIGNING FOR ESTATES,
TRUSTS, OR CORPORATIONS, TITLE OR CAPACITY
SHOULD BE STATED. IF SHARES ARE HELD JOINTLY,
EACH HOLDER MUST SIGN.
- ----------------------------------------------------------------------------------------------------
Signature: Date: Signature: Date:
</TABLE>
