o 192 P-3
SUPPLEMENT DATED JUNE 1, 2000
TO THE PROSPECTUS OF
FRANKLIN REAL ESTATE SECURITIES FUND
DATED SEPTEMBER 1, 1999
The prospectus is amended as follows:
I. All references to Franklin Templeton Trust Company in this prospectus are
replaced with Franklin Templeton Bank & Trust.
II. The section "Management" on page 12 is replaced with the following:
[Insert graphic of briefcase] MANAGEMENT
Franklin Advisers, Inc. (Advisers), 777 Mariners Island Blvd., San Mateo, CA
94404, is the fund's investment manager. Together, Advisers and its
affiliates manage over $233 billion in assets.
The fund's portfolio managers are:
DOUGLAS BARTON CFA, VICE PRESIDENT OF ADVISERS
Mr. Barton has been a manager of the fund since 1998. He joined the Franklin
Templeton Group in 1988.
SAM KERNER, PORTFOLIO MANAGER OF ADVISERS
Mr. Kerner has been a manager of the Fund since April 2000. He joined the
Franklin Templeton Group in 1996.
III. The section "Sales charge waivers" on page 20 is replaced with the
following:
SALES CHARGE WAIVERS Class A shares may be purchased without an initial sales
charge or CDSC by various individuals, institutions and retirement plans or
by investors who reinvest certain distributions and proceeds within 365 days.
Certain investors also may buy Class C shares without an initial sales
charge. The CDSC for each class may be waived for certain redemptions and
distributions. If you would like information about available sales charge
waivers, call your investment representative or call Shareholder Services at
1-800/632-2301. For information about retirement plans, you may call
Retirement Plan Services at 1-800/527-2020. A list of available sales charge
waivers also may be found in the Statement of Additional Information (SAI).
IV. The section "Minimum investments" on page 20 is replaced with the
following:
MINIMUM INVESTMENTS
- --------------------------------------------------------------------
INITIAL ADDITIONAL
- --------------------------------------------------------------------
Regular accounts $1,000 $50
- --------------------------------------------------------------------
Automatic investment plans $50 ($25 for $50 ($25
an Education for an
IRA) Education
IRA)
- --------------------------------------------------------------------
UGMA/UTMA accounts $100 $50
- --------------------------------------------------------------------
Retirement accounts
- --------------------------------------------------------------------
(other than IRAs, IRA rollovers, no minimum no minimum
Education IRAs or Roth IRAs)
- --------------------------------------------------------------------
IRAs, IRA rollovers, Education IRAs or $250 $50
Roth IRAs
- --------------------------------------------------------------------
Broker-dealer sponsored wrap account $250 $50
programs
- --------------------------------------------------------------------
Full-time employees, officers,
trustees and directors of
- --------------------------------------------------------------------
Franklin Templeton entities, and their $100 $50
immediate family members
- --------------------------------------------------------------------
PLEASE NOTE THAT YOU MAY ONLY BUY SHARES OF A FUND ELIGIBLE FOR SALE IN YOUR
STATE OR JURISDICTION.
V. The section "Account Application" on page 21 is replaced with the
following:
ACCOUNT APPLICATION If you are opening a new account, please complete and
sign the enclosed account application. Make sure you indicate the share class
you have chosen. If you do not indicate a class, we will place your purchase
in Class A shares. To save time, you can sign up now for services you may
want on your account by completing the appropriate sections of the
application (see "Investor Services" on page 22). For example, if you would
like to link one of your bank accounts to your Fund account so that you may
use electronic fund transfers to and from your bank account to buy and sell
shares, please complete the bank information section of the application. We
will keep your bank information on file for future purchases and redemptions.
VI. Effective July 3, 2000, the following is added to the section "Buying
shares" on page 21:
- ----------------------------------------------------------------------
[Insert graphic of If you have another Before requesting a
phone] Franklin Templeton telephone purchase,
account with your please make sure we
BY PHONE bank account have your bank
information on file, account information
(Up to $100,000 per you may open a new on file. If we do not
day) account by phone. The have this
1-800/632-2301 accounts must be information, you will
identically need to send written
registered. instructions with
your bank's name and
To make a same day address, a voided
investment, please check or savings
call us by 1:00 p.m. account deposit slip,
Pacific time or the and a signature
close of the New York guarantee if the
Stock Exchange, ownership of the bank
whichever is earlier. and Fund accounts is
different.
To make a same day
investment, please
call us by 1:00 p.m.
Pacific time or the
close of the New York
Stock Exchange,
whichever is earlier.
- ----------------------------------------------------------------------
VII. The section "Automatic Investment Plan" on page 22 is replaced with the
following:
AUTOMATIC INVESTMENT PLAN This plan offers a convenient way for you to invest
in the Fund by automatically transferring money from your checking or savings
account each month to buy shares. To sign up, complete the appropriate
section of your account application and mail it to Investor Services.
If you are opening a new account, please include the minimum initial
investment of $50 ($25 for an Education IRA) with your application.
VIII. The section "Telephone Privileges" on page 23 is replaced with the
following:
TELEPHONE PRIVILEGES You will automatically receive telephone privileges when
you open your account, allowing you and your investment representative to
buy, sell or exchange your shares and make certain other changes to your
account by phone.
For accounts with more than one registered owner, telephone privileges also
allow the Fund to accept 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. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one
signature for all transactions. This type of telephone exchange is available
as long as you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone purchase, exchange or redemption privileges
on your account application.
IX. In the Selling Shares table on page 26 the section "By Wire" is replaced
with the following:
- ----------------------------------------------------------------------
[Insert graphic of three lightning You can call or write to have
bolts] redemption proceeds sent to a
bank account. See the policies
BY ELECTRONIC FUNDS TRANSFER (ACH) above for selling shares by mail
or phone.
Before requesting to have
redemption proceeds sent to a
bank account, please make sure
we have your bank account
information on file. If we do
not have this information, you
will need to send written
instructions with your bank's
name and address, a voided check
or savings account deposit slip,
and a signature guarantee if the
ownership of the bank and fund
accounts is different.
If we receive your request in
proper form by 1:00 p.m. Pacific
time, proceeds sent by ACH
generally will be available
within two to three business
days.
- ----------------------------------------------------------------------
X. The section "Statements and reports" on page 27 is replaced with the
following:
STATEMENTS AND REPORTS You will receive quarterly account statements that
show all your account transactions during the quarter. You also will receive
written notification after each transaction affecting your account (except
for distributions and transactions made through automatic investment or
withdrawal programs, which will be reported on your quarterly statement). You
also will receive the Fund's financial reports every six months. To reduce
Fund expenses, we try to identify related shareholders in a household and
send only one copy of the financial reports. If you need additional copies,
please call 1-800/DIAL BEN.
If there is a dealer or other investment representative of record on your
account, he or she also will receive copies of all notifications and
statements and other information about your account directly from the Fund.
XI. The section "Dealer compensation" on page 29 is replaced with the
following:
DEALER COMPENSATION Qualifying dealers who sell Fund shares may receive sales
commissions and other payments. These are paid by Franklin Templeton
Distributors, Inc. (Distributors) from sales charges, distribution and
service (12b-1) fees and its other resources.
CLASS A CLASS B CLASS C
- -----------------------------------------------------------------
COMMISSION (%) - 3.00 2.00
Investment under $100,000 4.00 - -
$100,000 but under $250,000 3.25 - -
$250,000 but under $500,000 2.25 - -
$500,000 but under $1 million 1.85 - -
$1 million or more up to 0.75 1 - -
12B-1 FEE TO DEALER 0.15 0.15 2 0.65 3
A dealer commission of up to 1% may be paid on Class A NAV purchases by
certain retirement plans/1 and on Class C NAV purchases. A dealer commission
of up to 0.25% may be paid on Class A NAV purchases by certain trust
companies and bank trust departments, eligible governmental authorities, and
broker-dealers or others on behalf of clients participating in comprehensive
fee programs.
MARKET TIMERS. Please note that for Class A NAV purchases by market timers,
including purchases of $1 million or more, dealers are not eligible to
receive the dealer commission. Dealers, however, may be eligible to receive
the 12b-1 fee from the date of purchase. If a dealer commission is paid on a
Class A NAV purchase that we later determine was made by a market timer, all
commissions paid in connection with that purchase during the last twelve
months must be returned.
1. During the first year after purchase, dealers may not be eligible to
receive the 12b-1 fee.
2. Dealers may be eligible to receive up to 0.15% from the date of purchase.
After 8 years, Class B shares convert to Class A shares and dealers may then
receive the 12b-1 fee applicable to Class A.
3. Dealers may be eligible to receive up to 0.15% during the first year after
purchase and may be eligible to receive the full 12b-1 fee starting in the
13th month.
Please keep this supplement for future reference.
o 192 PA-4
SUPPLEMENT DATED JUNE 1, 2000
TO THE PROSPECTUS OF
FRANKLIN REAL ESTATE SECURITIES FUND - ADVISOR CLASS
DATED SEPTEMBER 1, 1999
The prospectus is amended as follows:
I. All references to Franklin Templeton Trust Company in this prospectus are
replaced with Franklin Templeton Bank & Trust.
II. The section "Year 2000" on page 6 is deleted:
III. The Advisor Class Annual Total Returns chart in the "Performance"
section on page 8 erroneously excluded the dates from the five depicted
performance bars. The chart should include the calendar years of '94 for the
9.60% return, '95 for the 18.04% return, '96 for the 32.50% return, '97 for
the 20.24% return and '98 for the -15.11% return.
IV. The section "Management" on page 10 is replaced with the following:
[Insert graphic of briefcase] MANAGEMENT
Franklin Advisers, Inc. (Advisers), 777 Mariners Island Blvd., San Mateo, CA
94404, is the fund's investment manager. Together, Advisers and its
affiliates manage over $233 billion in assets.
The fund's portfolio managers are:
DOUGLAS BARTON CFA, VICE PRESIDENT OF ADVISERS
Mr. Barton has been a manager of the fund since 1998. He joined the Franklin
Templeton Group in 1988.
SAM KERNER, PORTFOLIO MANAGER OF ADVISERS
Mr. Kerner has been a manager of the Fund since April 2000. He joined the
Franklin Templeton Group in 1996.
The fund pays Advisers a fee for managing the fund's assets. For the fiscal
year ended April 30, 1999, the fund paid 0.51% of its average net assets to
the manager for its services.
V. The section "Account Application" on page 16 is replaced with the
following:
ACCOUNT APPLICATION If you are opening a new account, please complete and
sign the enclosed account application. To save time, you can sign up now for
services you may want on your account by completing the appropriate sections
of the application (see "Investor Services" on page 17). For example, if you
would like to link one of your bank accounts to your fund account so that you
may use electronic fund transfers to and from your bank account to buy and
sell shares, please complete the bank information section of the application.
We will keep your bank information on file for future purchases and
redemptions.
VI. Effective July 3, 2000, the following is added to the section "Buying
shares" on page 16:
- ----------------------------------------------------------------------
[Insert graphic of If you have another Before requesting a
phone] Franklin Templeton telephone purchase,
account with your please make sure we
BY PHONE bank account have your bank
information on file, account information
(Up to $100,000 per you may open a new on file. If we do not
day) account by phone. The have this
1-800/632-2301 accounts must be information, you will
identically need to send written
registered. instructions with
your bank's name and
To make a same day address, a voided
investment, please check or savings
call us by 1:00 p.m. account deposit slip,
Pacific time or the and a signature
close of the New York guarantee
Stock Exchange, if the ownership of
whichever is earlier. the bank and fund
accounts
is different.
To make a same day
investment, please
call us by 1:00 p.m.
Pacific time or the
close of the New York
Stock Exchange,
whichever is earlier.
- ----------------------------------------------------------------------
VII. The section "Automatic Investment Plan" on page 17 is replaced with the
following:
AUTOMATIC INVESTMENT PLAN This plan offers a convenient way for you to invest
in the fund by automatically transferring money from your checking or savings
account each month to buy shares. To sign up, complete the appropriate
section of your account application and mail it to Investor Services. If you
are opening a new account, please include your minimum initial investment
with your application.
VIII. The following section is added to "Investor Services" on page 17:
AUTOMATIC PAYROLL DEDUCTION You may invest in the fund automatically by
transferring money from your paycheck to the fund by electronic funds
transfer. If you are interested, indicate on your application that you would
like to receive an Automatic Payroll Deduction Program kit.
IX. The section "Telephone Privileges" on page 17 is replaced with the
following:
TELEPHONE PRIVILEGES You will automatically receive telephone privileges when
you open your account, allowing you and your investment representative to
buy, sell or exchange your shares and make certain other changes to your
account by phone.
For accounts with more than one registered owner, telephone privileges also
allow the fund to accept 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. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one
signature for all transactions. This type of telephone exchange is available
as long as you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone purchase, exchange or redemption privileges
on your account application.
X. The section "Statements and reports" on page 21 is replaced with the
following:
STATEMENTS AND REPORTS You will receive quarterly account statements that
show all your account transactions during the quarter. You also will receive
written notification after each transaction affecting your account (except
for distributions and transactions made through automatic investment or
withdrawal programs, which will be reported on your quarterly statement). You
also will receive the fund's financial reports every six months. To reduce
fund expenses, we try to identify related shareholders in a household and
send only one copy of the financial reports. If you need additional copies,
please call 1-800/DIAL BEN.
If there is a dealer or other investment representative of record on your
account, he or she also will receive copies of all notifications and
statements and other information about your account directly from the fund.
Please keep this supplement for future reference.
o 192 SA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE STATEMENT OF ADDITIONAL INFORMATION OF
FRANKLIN REAL ESTATE SECURITIES FUND
DATED SEPTEMBER 1, 1999, AS AMENDED JANUARY 1, 2000
The Statement of Additional Information (SAI) is amended as follows:
I. All references to Franklin Templeton Trust Company in this SAI are
replaced with Franklin Templeton Bank & Trust.
II. The first waiver category in the section "Waivers for certain investors"
on page 21 is revised to read:
o Trust companies and bank trust departments investing assets held in a
fiduciary, agency, advisory, custodial or similar capacity and over which the
trust companies and bank trust departments or other plan fiduciaries or
participants, in the case of certain retirement plans, have full or shared
investment discretion. We may accept orders for these accounts by telephone
or other means of electronic data transfer directly from the bank or trust
company, with payment by federal funds received by the close of business on
the next business day following the order.
III. The eighth waiver category in the section "CDSC waivers" on page 23 is
revised to read:
o Redemptions by an employee benefit plan: (i) that is a customer of Franklin
Templeton Defined Contribution Services; and/or (ii) whose assets are held by
Franklin Templeton Bank & Trust as trustee or custodian (not applicable to
Class B)
IV. The section "Systematic withdrawal plan" on page 24 is replaced with the
following:
SYSTEMATIC WITHDRAWAL PLAN Our systematic withdrawal plan allows you to sell
your shares and receive regular payments from your account on a monthly,
quarterly, semiannual or annual basis. The value of your account must be at
least $5,000 and the minimum payment amount for each withdrawal must be at
least $50. For retirement plans subject to mandatory distribution
requirements, the $50 minimum will not apply. There are no service charges
for establishing or maintaining a systematic withdrawal plan.
Each month in which a payment is scheduled, we will redeem an equivalent
amount of shares in your account on
the day of the month you have indicated on your account application or, if no
day is indicated, on the 20th day of
the month. If that day falls on a weekend or holiday, we will process the
redemption on the next business day. For plans set up before June 1, 2000, we
will continue to process redemptions on the 25th day of the month (or the
next business day) unless you instruct us to change the processing date.
Available processing dates currently are the 1st, 5th, 10th, 15th, 20th and
25th days of the month. When you sell your shares under a systematic
withdrawal plan, it is a taxable transaction.
To avoid paying sales charges on money you plan to withdraw within a short
period of time, you may not want to set up a systematic withdrawal plan if
you plan to buy shares on a regular basis. Shares sold under the plan also
may be subject to a CDSC.
Redeeming shares through a systematic withdrawal plan may reduce or exhaust
the shares in your account if payments exceed distributions received from the
fund. This is especially likely to occur if there is a market decline. If a
withdrawal amount exceeds the value of your account, your account will be
closed and the remaining balance in your account will be sent to you. Because
the amount withdrawn under the plan may be more than your actual yield or
income, part of the payment may be a return of your investment.
To discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment, we must receive instructions
from you at least three business days before a scheduled payment. The fund
may discontinue a systematic withdrawal plan by notifying you in writing and
will discontinue a systematic withdrawal plan automatically if all shares in
your account are withdrawn or if the fund receives notification of the
shareholder's death or incapacity.
V. The following paragraph is added to the section "General information" on
page 24:
There are special procedures for banks and other institutions that wish to
open multiple accounts. An institution may open a single master account by
filing one application form with the fund, signed by personnel authorized to
act for the institution. Individual sub-accounts may be opened when the
master account is opened by listing them on the application, or by providing
instructions to the fund at a later date. These sub-accounts may be
registered either by name or number. The fund's investment minimums apply to
each sub-account. The fund will send confirmation and account statements for
the sub-accounts to the institution.
Please keep this supplement for future reference.
o 192 SAA-1
SUPPLEMENT DATED JUNE 1, 2000
TO THE STATEMENT OF ADDITIONAL INFORMATION OF
FRANKLIN REAL ESTATE SECURITIES FUND - ADVISOR CLASS
DATED SEPTEMBER 1, 1999
The Statement of Additional Information (SAI) is amended as follows:
I. The section "Systematic withdrawal plan" on page 20 is replaced with the
following:
SYSTEMATIC WITHDRAWAL PLAN Our systematic withdrawal plan allows you to sell
your shares and receive regular payments from your account on a monthly,
quarterly, semiannual or annual basis. The value of your account must be at
least $5,000 and the minimum payment amount for each withdrawal must be at
least $50. For retirement plans subject to mandatory distribution
requirements, the $50 minimum will not apply. There are no service charges
for establishing or maintaining a systematic withdrawal plan.
Each month in which a payment is scheduled, we will redeem an equivalent
amount of shares in your account on
the day of the month you have indicated on your account application or, if no
day is indicated, on the 20th day of
the month. If that day falls on a weekend or holiday, we will process the
redemption on the next business day. For plans set up before June 1, 2000, we
will continue to process redemptions on the 25th day of the month (or the
next business day) unless you instruct us to change the processing date.
Available processing dates currently are the 1st, 5th, 10th, 15th, 20th and
25th days of the month. When you sell your shares under a systematic
withdrawal plan, it is a taxable transaction.
Redeeming shares through a systematic withdrawal plan may reduce or exhaust
the shares in your account if payments exceed distributions received from the
fund. This is especially likely to occur if there is a market decline. If a
withdrawal amount exceeds the value of your account, your account will be
closed and the remaining balance in your account will be sent to you. Because
the amount withdrawn under the plan may be more than your actual yield or
income, part of the payment may be a return of your investment.
To discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment, we must receive instructions
from you at least three business days before a scheduled payment. The fund
may discontinue a systematic withdrawal plan by notifying you in writing and
will discontinue a systematic withdrawal plan automatically if all shares in
your account are withdrawn or if the fund receives notification of the
shareholder's death or incapacity.
II. The following paragraph is added to the section "General information" on
page 20:
There are special procedures for banks and other institutions that wish to
open multiple accounts. An institution may open a single master account by
filing one application form with the fund, signed by personnel authorized to
act for the institution. Individual sub-accounts may be opened when the
master account is opened by listing them on the application, or by providing
instructions to the fund at a later date. These sub-accounts may be
registered either by name or number. The fund's investment minimums apply to
each sub-account. The fund will send confirmation and account statements for
the sub-accounts to the institution.
Please keep this supplement for future reference.
