TL417STKP
SUPPLEMENT DATED MAY 1, 1997
TO THE PROSPECTUS OF
Franklin Templeton Japan Fund
dated August 1, 1996
The prospectus is amended as follows:
I. The section "Sales Charge Waivers" under "How Do I Buy Shares? - Sales
Charge Reductions and Waivers" is amended as follows:
A. Category 8 is replaced with:
8. Chilean retirement plans that meet the requirements described under
"Retirement Plans" below. B. Effective June 1, 1997, category 5 is deleted in
its entirety.
II. The following paragraph is added after the list of "Sales Charge Waivers"
under "How Do I Buy Shares?": Retirement Plans. Retirement plans that (i) are
sponsored by an employer with at least 100 employees, or (ii) have plan assets
of $1 million or more, or (iii) agree to invest at least $500,000 in the
Franklin Templeton Funds over a 13 month period may buy shares without a
front-end sales charge. Retirement plans that are not Qualified Retirement
Plans or SEPs, such as 403(b) or 457 plans, must also meet the requirements
described under "Group Purchases" above. For retirement plan accounts opened
on or after May 1, 1997, a Contingent Deferred Sales Charge may apply if the
account is closed within 365 days of the retirement plan account's initial
purchase in the Franklin Templeton Funds. Please see "How Do I Sell Shares? -
Contingent Deferred Sales Charge" for details. Any retirement plan that does
not meet the requirements to buy shares without a front-end sales charge and
that was a shareholder of the Fund on or before February 1, 1995, may buy
shares of the Fund subject to a maximum sales charge of 4% of the Offering
Price, 3.2% of which will be retained by Securities Dealers.
III. The section "How Do I Buy Shares? - Other Payments to Securities Dealers"
is replaced in its entirety with the following:
Other Payments to Securities Dealers
The payments described below may be made to Securities Dealers who initiate
and are responsible for certain purchases made without a sales charge. The
payments are subject to the sole discretion of Distributors, and are paid by
Distributors or one of its affiliates and not by the Fund or its shareholders.
1. Purchases of $1 million or more - up to 1% of the amount invested.
2.Purchases made without a front-end sales charge by certain retirement plans
described under "Sales Charge Reductions and Waivers - Retirement Plans" above
- up to 1% of the amount invested. For retirement plan accounts opened on or
after May 1, 1997, a Contingent Deferred Sales Charge will not apply to the
account if the Securities Dealer chooses to receive a payment of 0.25% or less
or if no payment is made.
3. Purchases by trust companies and bank trust
departments, Eligible Governmental Authorities, and broker-dealers or others
on behalf of clients participating in comprehensive fee programs - up to 0.25%
of the amount invested.
4. Purchases by Chilean retirement plans - up to 1% of the amount invested.
A Securities Dealer may receive only one of these payments for each qualifying
purchase. Securities Dealers who receive payments in connection with investments
described in paragraphs 1 or 4 above or a payment of up to 1% for investments
described in paragraph 2 will be eligible to receive the Rule 12b-1 fee
associated with the purchase starting in the thirteenth calendar month after the
purchase.
FOR BREAKPOINTS THAT MAY APPLY, PLEASE SEE "HOW DO I BUY, SELL AND
EXCHANGE SHARES? - OTHER PAYMENTS TO SECURITIES DEALERS" IN THE SAI.
Distributors and/or its affiliates provide financial support to various
Securities Dealers that sell shares of the Franklin Templeton Group of Funds.
This support is based primarily on the amount of sales of fund shares. The
amount of support may be affected by: total sales; net sales; levels of
redemptions; the proportion of a Securities Dealer's sales and marketing efforts
in the Franklin Templeton Group of Funds; a Securities Dealer's support of, and
participation in, Distributors' marketing programs; a Securities Dealer's
compensation programs for its registered representatives; and the extent of a
Securities Dealer's marketing programs relating to the Franklin Templeton Group
of Funds. Financial support to Securities Dealers may be made by payments from
Distributors' resources, from Distributors' retention of underwriting
concessions and, in the case of funds that have Rule 12b-1 plans, from payments
to Distributors under such plans. In addition, certain Securities Dealers may
receive brokerage commissions generated by fund portfolio transactions in
accordance with the NASD's rules.
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IV. The following paragraph is added under "How Do I Sell Shares?":
Beginning on or about May 1, 1997, you will automatically be able to redeem
shares by telephone without completing a telephone redemption agreement.
Please notify us in writing if you do not want this option to be available on
your account. If you later decide you would like this option, send us written
instructions signed by all account owners, with a signature guarantee.
V. The following is added under "How Do I Sell Shares? - Contingent Deferred
Sales Charge":
Certain retirement plan accounts opened on or after May 1, 1997, and that
qualify to buy shares without a front-end sales charge may also be subject to
a Contingent Deferred Sales Charge if the retirement plan account is closed
within 365 days of the account's initial purchase in the Franklin Templeton
Funds.
VI. The section "Contingent Deferred Sales Charge - Waivers" under "How Do
I Sell Shares?" is replaced in its entirety with the following:
Waivers. We waive the Contingent Deferred Sales Charge for:
o Exchanges
o Account fees
o Sales of shares purchased pursuant to a sales charge waiver
o Sales of shares purchased without a front-end sales charge by certain
retirement plan accounts if (i) the account was opened before May 1, 1997, or
(ii) the Securities Dealer of record received a payment from Distributors of
0.25% or less, or (iii) Distributors did not make any payment in connection
with the purchase, as described under "How Do I Buy Shares? - Other Payments
to Securities Dealers"
o Redemptions by the Fund when an account falls below the minimum equired
account size
o Redemptions following the death of the shareholder or beneficial owner
o Redemptions through a systematic withdrawal plan set up before February 1,
1995
o Redemptions through a systematic withdrawal plan set up on or after
February 1, 1995, at a rate of up to 1% a month of an account's Net Asset
Value. For example, if you maintain an annual balance of $1 million, you ca
redeem up to $120,000 annually through a systematic withdrawal plan free
of charge.
o Distributions from individual retirement plan accounts due to death or
disability or upon periodic distributions based on life expectancy
o Tax-free returns of excess contributions from employee benefit plans
o Redemptions by Trust Company employee benefit plans or employee benefit plans
serviced by ValuSelect
o Participant initiated distributions from employee benefit plans or participant
initiated exchanges among investment choices in employee benefit plans
