o FTIT *PA3
SUPPLEMENT DATED JANUARY 1, 1999
TO THE PROSPECTUS OF
FRANKLIN TEMPLETON INTERNATIONAL TRUST - ADVISOR CLASS
DATED MARCH 1, 1998
The prospectus is amended as follows:
I. As of January 1, 1999, the Smaller Companies Fund offers four classes
of shares: Class A, Class B, Class C and Advisor Class. The Pacific Fund
offers three classes of shares: Class A, Class C and Advisor Class.
Before January 1, 1999, Class A shares were designated Class I and Class
C shares were designated Class II. All references in the prospectus to
Class I shares are replaced with Class A.
II. The following is added under "What Are the Risks of Investing in the
Fund?":
YEAR 2000. When evaluating current and potential portfolio positions,
Year 2000 is one of the factors Advisers considers.
Advisers will rely upon public filings and other statements made by
companies about their Year 2000 readiness. Issuers in countries outside
the U.S., particularly in emerging markets, may not be required to make
the same level of disclosure about Year 2000 readiness as is required in
the U.S. Advisers, of course, cannot audit each company and its major
suppliers to verify their Year 2000 readiness.
If a company in which the Fund is invested is adversely affected by Year
2000 problems, it is likely that the price of its security will also be
adversely affected. A decrease in the value of one or more of the Fund's
portfolio holdings will have a similar impact on the price of the Fund's
shares. Please see "Year 2000 Problem" under "Who Manages the Fund?" for
more information.
EURO RISK. On January 1, 1999, the European Monetary Union (EMU) plans
to introduce a new single currency, the euro, which will replace the
national currency for participating member countries. If the Fund holds
investments in countries with currencies replaced by the euro, the
investment process, including trading, foreign exchange, payments,
settlements, cash accounts, custody and accounting will be impacted.
The process to establish the euro may result in market volatility. It is
not possible to predict the impact of the euro on the business or
financial condition of European issuers or on the Fund. The transition
and the elimination of currency risk among EMU countries may change the
economic environment and behavior of investors, particularly in European
markets. To the extent the Fund holds non-U.S. dollar (euro or other)
denominated securities, it will still be exposed to currency risk due to
fluctuations in those currencies versus the U.S. dollar.
Resources has created an interdepartmental team to handle all
euro-related changes to enable the Franklin Templeton Funds to process
transactions accurately and completely with minimal disruption to
business activities. While there can be no assurance that the Fund will
not be adversely affected, Advisers and its affiliated service providers
are taking steps that they believe are reasonably designed to address
the euro issue.
III. In the section "Who Manages the Fund?",
(a) the section "Management Team" is revised to add Juan J. Benito to
the Smaller Companies Fund management team, effective July 1997, and to
add the following:
Juan J. Benito
Portfolio Manager of Investment Counsel
Mr. Benito is currently a portfolio manager and research analyst with
Investment Counsel. He holds an MBA from the Harvard Business School and
a BS/MS in engineering from the Polytechnical University of Valencia,
Spain. Before joining the Templeton organization in 1996, Mr. Benito was
a management consultant and case team leader with Monitor Company, a
leading global strategy consulting firm in Cambridge, Massachusetts
(1994-1996). His previous experience includes being an internal planning
consultant with Duke Power (1993-1994), a business development
consultant with IBM Consulting Group (1992), and a regional manager with
Iberdrola, a large power utility company in Spain (1987-1991). Mr.
Benito's research responsibilities include coverage of European small
cap companies.
(b) and the following is added after the "Administrative Services"
section:
YEAR 2000 PROBLEM. The Fund's business operations depend on a worldwide
network of computer systems that contain date fields, including
securities trading systems, securities transfer agent operations and
stock market links. Many of the systems currently use a two digit date
field to represent the date, and unless these systems are changed or
modified, they may not be able to distinguish the Year 1900 from the
Year 2000 (commonly referred to as the Year 2000 problem). In addition,
the fact that the Year 2000 is a non-standard leap year may create
difficulties for some systems.
When the Year 2000 arrives, the Fund's operations could be adversely
affected if the computer systems used by Advisers, its service providers
and other third parties it does business with are not Year 2000 ready.
For example, the Fund's portfolio and operational areas could be
impacted, including securities trade processing, interest and dividend
payments, securities pricing, shareholder account services, reporting,
custody functions and others. The Fund could experience difficulties in
effecting transactions if any of its foreign subcustodians, or if
foreign broker-dealers or foreign markets are not ready for Year 2000.
Advisers and its affiliated service providers are making a concerted
effort to take steps they believe are reasonably designed to address
their Year 2000 problems. Of course, the Fund's ability to reduce the
effects of the Year 2000 problem is also very much dependent upon the
efforts of third parties over which the Fund and Advisers may have no
control.
IV. Under "How Is the Trust Organized?", the first paragraph is replaced
with the following:
Each Fund is a diversified series of the Trust, an open-end management
investment company, commonly called a mutual fund. It was organized as a
Delaware business trust on March 22, 1991, and is registered with the
SEC. The Smaller Companies Fund offers four classes of shares: Templeton
Foreign Smaller Companies Fund - Class A, Templeton Foreign Smaller
Companies Fund - Class B, Templeton Foreign Smaller Companies Fund -
Class C and Templeton Foreign Smaller Companies Fund - Advisor Class.
The Pacific Fund offers three classes of shares: Templeton Pacific
Growth Fund - Class A, Templeton Pacific Growth Fund - Class C and
Templeton Pacific Growth Fund - Advisor Class. Additional series and
classes of shares may be offered in the future.
V. In step 2 under "How Do I Buy Shares? - Opening Your Account," the
minimum investment to add to your account is changed from $25 to $50.
VI. The section "How Do I Buy Shares in Connection with Retirement
Plans?", found under "How Do I Buy Shares?", is replaced with the
following:
HOW DO I BUY SHARES IN CONNECTION WITH RETIREMENT PLANS?
Your individual or employer-sponsored retirement plan may invest in the
Fund. Plan documents are required for all retirement plans. Trust
Company can provide the plan documents for you and serve as custodian or
trustee.
Trust Company can provide you with brochures containing important
information about its plans. These plans require separate applications
and their policies and procedures may be different than those described
in this prospectus. For more information, including a free retirement
plan brochure or application, please call Retirement Plan Services.
Please consult your legal, tax or retirement plan specialist before
choosing a retirement plan. Your investment representative or advisor
can help you make investment decisions within your plan.
VII. In the section "Exchange Restrictions," found under "May I
Exchange Shares for Shares of Another Fund?",
(a) the second item is replaced with the following:
Generally exchanges may only be made between identically registered
accounts, unless you send written instructions with a signature guarantee.
You may, however, exchange shares from a Fund account requiring two or
more signatures into an identically registered money fund account
requiring only one signature for all transactions. PLEASE NOTIFY US IN
WRITING IF YOU DO NOT WANT THIS OPTION TO BE AVAILABLE ON YOUR ACCOUNT.
Additional procedures may apply. Please see "Transaction Procedures and
Special Requirements."
(b) and the following new item is added:
You must meet the applicable minimum investment amount of the fund your
are exchanging into, or exchange 100% of your Fund shares.
VIII.In the "By Phone" section of the chart under "How Do I Sell
Shares?",
(a) the first bulleted item is replaced with the following:
If the request is $100,000 or less. Institutional accounts may exceed
$100,000 by completing a separate agreement. Call Institutional Services
to receive a copy.
(b) and the third bulleted item is deleted.
IX. Distribution option 3 in the section "What Distributions Might I
Receive From the Fund? - Distribution Options" is replaced with the
following:
3. RECEIVE DISTRIBUTIONS IN CASH - You may receive dividends, or both
dividend and capital gain distributions in cash. If you have the money
sent to another person or to a checking or savings account, you may need
a signature guarantee. If you send the money to a checking or savings
account, please see "Electronic Fund Transfers" under "Services to Help
You Manage Your Account."
X. Under "Transaction Procedures and Special Requirements,"
(a) the section "Joint Accounts" is replaced with the following:
JOINT ACCOUNTS. For accounts with more than one registered owner, the
Fund accepts written instructions signed by only one owner for
transactions and account changes that could otherwise be made by phone.
For all other transactions and changes, all registered owners must sign
the instructions.
Please keep in mind that if you have previously told us that you do not
want telephone exchange or redemption privileges on your account, then
we can only accept written instructions to exchange or redeem shares if
they are signed by all registered owners on the account.
(b) the reference to $50,000 in the section "Signature Guarantees" is
replaced with $100,000.
(c) the section "Trust Company Retirement Plan Accounts," found under
"Telephone Transactions," is deleted.
(d) and the section "Keeping Your Account Open" is replaced with the
following:
KEEPING YOUR ACCOUNT OPEN
Due to the relatively high cost of maintaining a small account, we may
close your account if the value of your shares is less than $250, or
less than $50 for employee accounts. We will only do this if the value
of your account fell below this amount because you voluntarily sold your
shares and your account has been inactive (except for the reinvestment
of distributions) for at least six months. Before we close your account,
we will notify you and give you 30 days to increase the value of your
account to $1,000, or $100 for employee accounts. These minimums do not
apply to IRAs, accounts managed by the Franklin Templeton Group, the
Franklin Templeton Profit Sharing 401(k) Plan, the series of Franklin
Templeton Fund Allocator Series, or certain defined contribution plans
that qualify to buy shares with no minimum initial investment
requirement.
XI. In the section "Services to Help You Manage Your Account":
(a) the second sentence in the section "Automatic Investment Plan" is
replaced with the following:
Under the plan, you can have money transferred automatically from your
checking or savings account to the Fund each month to buy additional
shares.
(b) the second paragraph under "Systematic Withdrawal Plan" is replaced
with the following:
If you would like to establish a systematic withdrawal plan, please
complete the systematic withdrawal plan section of the account
application included with this prospectus and indicate how you would
like to receive your payments. You may choose to direct your payments to
buy the same class of shares of another Franklin Templeton Fund or have
the money sent directly to you, to another person, or to a checking or
savings account. If you choose to have the money sent to a checking or
savings account, please see "Electronic Fund Transfers" below. Once your
plan is established, any distributions paid by the Fund will be
automatically reinvested in your account.
(c) and the following new section is added after the section "Systematic
Withdrawal Plan":
ELECTRONIC FUND TRANSFERS
You may choose to have dividend and capital gain distributions or
payments under a systematic withdrawal plan sent directly to a checking
or savings account. If the account is with a bank that is a member of
the Automated Clearing House, the payments may be made automatically by
electronic funds transfer. If you choose this option, please allow at
least fifteen days for initial processing. We will send any payments
made during that time to the address of record on your account.
XII In the "Useful Terms and Definitions" section, the definition of
"Class I, Class II and Advisor Class" is replaced with the following:
CLASS A, CLASS B, CLASS C AND ADVISOR CLASS - The Smaller Companies Fund
offers four classes of shares, designated "Class A," "Class B," "Class
C" and "Advisor Class." The Pacific Fund offers three classes of shares,
designated "Class A," "Class C" and "Advisor Class." The classes have
proportionate interests in the Fund's portfolio. They differ, however,
primarily in their sales charge and expense structures.
Please keep this supplement for future reference.
FTIT *SAA
SUPPLEMENT DATED JANUARY 1, 1999
TO THE STATEMENT OF ADDITIONAL INFORMATION OF
FRANKLIN TEMPLETON INTERNATIONAL TRUST - ADVISOR CLASS
dated March 1, 1998
The Statement of Additional Information is amended as follows:
I. As of January 1, 1999, the Smaller Companies Fund offers four classes
of shares: Class A, Class B, Class C and Advisor Class. The Pacific Fund
offer three classes of shares: Class A, Class C and Advisor Class.
Before January 1, 1999, Class A shares were designated Class I and Class
C shares were designated Class II. All references in the Statement of
Additional Information to Class I shares are replaced with Class A.
II. The first sentence in the section "Additional Information on
Exchanging Shares," found under "How Do I Buy, Sell and Exchange
Shares?", is replaced with the following:
If you request the exchange of the total value of your account, declared
but unpaid income dividends and capital gain distributions will be
reinvested in the Fund and exchanged into the new fund at Net Asset
Value when paid.
III. Under "Miscellaneous Information," the following is added:
The Information Services & Technology division of Resources established
a Year 2000 Project Team in 1996. This team has already begun making
necessary software changes to help the computer systems that service the
Fund and its shareholders to be Year 2000 compliant. After completing
these modifications, comprehensive tests are conducted in one of
Resources' U.S. test labs to verify their effectiveness. Resources
continues to seek reasonable assurances from all major hardware,
software or data-services suppliers that they will be Year 2000
compliant on a timely basis. Resources is also beginning to develop a
contingency plan, including identification of those mission critical
systems for which it is practical to develop a contingency plan.
However, in an operation as complex and geographically distributed as
Resources' business, the alternatives to use of normal systems,
especially mission critical systems, or supplies of electricity or long
distance voice and data lines are limited.
IV. In the "Useful Terms and Definitions" section, the definition of
"Class I, Class II and Advisor Class" is replaced with the following:
Class A, Class B, Class C and Advisor Class - The Smaller Companies Fund
offers four classes of shares, designated "Class A," "Class B," "Class
C" and "Advisor Class." The Pacific Fund offers three classes of shares,
designated "Class A," "Class C" and "Advisor Class." The classes have
proportionate interests in the Fund's portfolio. They differ, however,
primarily in their sales charge and expense structures.
Please keep this supplement for future reference.
