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:
[x] Preliminary Proxy Statement
[ ] 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 page 1 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
adjournment.
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,
--------------------------
CHARLES B. JOHNSON
CHAIRMAN OF THE BOARD
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[LOGO](R)
FRANKLIN(R)TEMPLETON(R)
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 legally come before the Meeting or any adjournments thereof.
By Order of the Board of Trustees,
Deborah R. Gatzek
SECRETARY
San Mateo, California
Dated: August 27, 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 August
27, 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, 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.
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.
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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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 SINCE 1992 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.
*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.
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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*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.
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 TOTAL FEES
FRANKLIN TEMPLETON RECEIVED FROM
AGGREGATE GROUP OF FUNDS ON THE FRANKLIN
COMPENSATION WHICH TRUSTEE TEMPLETON GROUP
NAME OF TRUSTEE FROM THE FUND* SERVES** 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 162 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:
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NAME AND PRINCIPAL OCCUPATION
OFFICES WITH THE FUND DURING PAST FIVE YEARS AND AGE
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Harmon E. Burns Executive Vice President and
VICE PRESIDENT SINCE 1989 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.
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Martin L. Flanagan Senior Vice President and Chief
VICE PRESIDENT AND CHIEF FINANCIAL Financial Officer, Franklin
OFFICER SINCE 1995 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.
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Deborah R. Gatzek Senior Vice President and General
VICE PRESIDENT SINCE 1992 AND Counsel, Franklin Resources, Inc.;
SECRETARY SINCE 1989 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.
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Edward B. Jamieson See Proposal 1, "Election of
PRESIDENT SINCE 1992 Trustees."
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Charles B. Johnson See Proposal 1, "Election of
CHAIRMAN OF THE BOARD SINCE 1993 Trustees."
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Charles E. Johnson Senior Vice President and
VICE PRESIDENT SINCE 1989 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.
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Gregory E. Johnson President, Franklin Templeton
VICE PRESIDENT SINCE 1989 Distributors, Inc.; and Vice
President, Franklin Resources,
Inc. and Franklin Advisers, Inc.
Age 38.
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Rupert H. Johnson, Jr. See Proposal 1, "Election of
Senior Vice President since 1992 Trustees."
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Diomedes Loo-Tam Senior Vice President, Franklin
TREASURER AND PRINCIPAL ACCOUNTING Templeton Services, Inc.; and
OFFICER SINCE 1995 officer of 32 of the investment
companies in the Franklin
Templeton Group of Funds. Age 60.
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Edward V. McVey Senior Vice President and National
VICE PRESIDENT SINCE 1989 Sales Manager, Franklin Templeton
Distributors, Inc.; and officer of
28 of the investment companies in
the Franklin Templeton Group of
Funds. Age 62.
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R. Martin Wiskemann Senior Vice President, Portfolio
VICE PRESIDENT SINCE 1989 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.
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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
______________ shares outstanding and total net assets of $____________.
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 _________ to
solicit proxies from brokers, banks, other institutional holders and
individual shareholders for an approximate fee, including out-of-pocket
expenses, ranging between $_____ and $______. 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 27, 1999 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 13, 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: August 27, 1999
San Mateo, California
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 PROPOSALS 1 (INCLUDING ALL NOMINEES FOR TRUSTEES) AND 2, 3, AND 4, AND
WITHIN THE DISCRETION OF THE PROXYHOLDERS AS TO ANY OTHER MATTER PURSUANT TO
PROPOSAL 5.
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
X PLEASE MARK
VOTES AS IN
THIS EXAMPLE.
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THE BOARD UNANIMOUSLY RECOMMENDS THAT
YOU VOTE IN FAVOR OF PROPOSALS 1-4.
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FOR AGAINST ABSTAIN
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1. Election of Trustees. 2. To ratify [ ] [ ] [ ]
the selection
Nominees: Frank H. Abbott, III, of
Harris J. Ashton and Gordon S. PricewaterhouseCoopers
Macklin LLP as
independent
auditors for
the Fund's
fiscal year
ending March
31, 2000;
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[ ] FOR [ ] [ ] ABSTAIN 3. To [ ] [ ] [ ]
ALL WITHOLD eliminate the
NOMINEES AUTHORITY Fund's
LISTED TO VOTE fundamental
ABOVE FOR ALL investment
(EXCEPT NOMINEES restriction
AS LISTED regarding
MARKED ABIVE investment in
BELOW) other
investment
companies.
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[ ] For all MARK [ ] 4. To amend [ ] [ ] [ ]
nominees HERE FOR the Fund's
except ADDRESS fundamental
as noted CHANGE investment
above AND NOTE restriction
BELOW regarding
lending.
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5. To grant [ ] [ ] [ ]
the
proxyholders
the authority
to vote upon
any other
business that
may properly
come before
the Meeting or
any
adjournments
thereof.
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PLEASE SIGN AND PROMPTLY RETURN IN THE
ACCOMPANYING ENVELOPE. NO POSTAGE
REQUIRED IF MAILED IN THE U.S.
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Note: Please sign exactly as your name
appears on the proxy. If signing for
estates, trusts, or corporations,
title or capiciy should be stated. If
shares are held jointly, each holder
must sign.
- - --------------------------------------------------------------------------------
Signature: Date: Signature: Date:
