File No. 33-73244
As filed with the Securities and Exchange Commission on February 17, 1995
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
___
Pre-Effective Amendment No. / /
____
Post-Effective Amendment No. 4 / X /
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 / X /
Amendment No. 6 / X /
TEMPLETON GLOBAL INVESTMENT TRUST
(Exact Name of Registrant as Specified in Charter)
700 Central Avenue, P.O. Box 33030, St. Petersburg, Florida 33701-8030
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area
Code: (813) 823-8712
Jeffrey L. Steele, Esq. Thomas M. Mistele, Esq.
Dechert Price & Rhoads Templeton Global Investors, Inc.
1500 K Street, N.W. 500 East Broward Blvd.
Washington, D.C. 20005 Fort Lauderdale, FL 33394
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check
appropriate box)
immediately upon filing pursuant to paragraph (b)
on (date) pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a)
X 75 days after filing pursuant to paragraph (a)(2)
on (date) pursuant to paragraph (a) of Rule 485
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CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933
Registrant has elected to register an indefinite number of
shares of beneficial interest, $0.01 par value per share,
pursuant to Rule 24f-2 under the Investment Company Act of 1940.
Registrant filed the Notice required by Rule 24f-2 with respect
to its fiscal year ended March 31, 1994 on May 24, 1994.
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TEMPLETON GLOBAL INVESTMENT TRUST
CROSS-REFERENCE SHEET
Part A - Templeton Global Rising Dividends Fund
This Post-Effective Amendment No. 4 to the Registration Statement
(File No. 33-73244) on Form N-1A for Templeton Global Investment
Trust incorporates by reference the prospectus for Templeton
Global Rising Dividends Fund, which was contained in Templeton
Global Investment Trust's Post-Effective Amendment No. 2, which
was filed on September 14, 1994.
Part A - Templeton Global Infrastructure Fund
This Post-Effective Amendment No. 4 to the Registration Statement
(File No. 33-73244) on Form N-1A for Templeton Global Investment
Trust incorporates by reference the prospectus for Templeton
Global Infrastructure Fund, which was contained in Templeton
Global Investment Trust's Post-Effective Amendment No. 2, which
was filed on September 14, 1994.
Part A - Templeton Americas Government Securities Fund
This Post-Effective Amendment No. 4 to the Registration Statement
(File No. 33-73244) on Form N-1A for Templeton Global Investment
Trust incorporates by reference the prospectus for Templeton
Americas Government Securities Fund, which was contained in
Templeton Global Investment Trust's Post-Effective Amendment No.
3, which was filed on December 2, 1994.
Part A - Templeton Greater European Fund
Item No. Caption
1 Cover Page
2 Expense Table
3 Not Applicable
4 General Description;
Investment Techniques
5 Management of the Fund
5A Not Applicable
6 General Information
7 How to Buy Shares of the Fund
8 How to Sell Shares of the Fund
9 Not Applicable
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Part B
10 Cover Page
11 Table of Contents
12 General Information and History
13 Investment Objectives and
Policies
14 Management of the Trust
15 Principal Shareholders
16 Investment Management and Other
Services
17 Brokerage Allocation
18 Description of Shares; Part A
19 Purchase, Redemption and Pricing
of Shares
20 Tax Status
21 Principal Underwriter
22 Yield and Performance
Information
23 Financial Statements
Part A - Templeton Latin America Fund
Item No. Caption
1 Cover Page
2 Expense Table
3 Not Applicable
4 General Description; Investment
Techniques
5 Management of the Fund
5A Not Applicable
6 General Information
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7 How to Buy Shares of the Fund
8 How to Sell Shares of the Fund
9 Not Applicable
Part B
10 Cover Page
11 Table of Contents
12 General Information and History
13 Investment Objectives and
Policies
14 Management of the Trust
15 Principal Shareholders
16 Investment Management and Other
Services
17 Brokerage Allocation
18 Description of Shares; Part A
19 Purchase, Redemption and Pricing
of Shares
20 Tax Status
21 Principal Underwriter
22 Yield and Performance
Information
23 Financial Statements
<PAGE>
Part A
Prospectus
Templeton Global Rising Dividends Fund
Incorporated by Reference
<PAGE>
Part A
Prospectus
<PAGE>
Templeton Global Infrastructure Fund
Incorporated by Reference
<PAGE>
Part A
Prospectus
Templeton Americas Government Securities Fund
Incorporated by Reference
<PAGE>
TEMPLETON REGION FUNDS
700 Central Avenue
St. Petersburg, Florida 33701-3628
(813) 823-8712
PROSPECTUS
May __, 1995
INVESTMENT OBJECTIVES AND POLICIES
The Templeton Region Funds are the Templeton Greater
European Fund ("Greater European Fund") and the Templeton Latin
America Fund ("Latin America Fund")(each a "Fund" and
collectively the "Funds"), which are separate series of Templeton
Global Investment Trust (the "Trust"), an open-end management
investment company.
Greater European Fund seeks to achieve long-term capital
appreciation by investing primarily in equity securities of
companies in Greater Europe (Western, Central and Eastern Europe
and Russia).
Latin America Fund seeks to achieve long-term capital
appreciation by investing primarily in equity securities and debt
obligations of issuers in Latin American countries.
Investments in foreign securities involves certain
considerations which are not normally involved in investment in
securities of U.S. companies, and an investment in the Funds may
be considered speculative. Each Fund may borrow money for
investment purposes, and may invest up to 15% of its assets in
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illiquid securities, including up to 10% of its assets in
restricted securities, which may involve greater risk and
increased Fund expenses. See "Risk Factors." Investors should
carefully consider these risks before investing.
PURCHASE OF SHARES
Please complete and return the Shareholder Application. If
you need assistance in completing this form, please call our
Account Services Department. Each Fund offers two classes of
Shares to its investors. This structure allows investors to
consider, among other features, the impact of sales charges and
distribution fees ("Rule 12b-1 fees") on their investments in the
Funds. Shareholders should take the differences between the two
classes into account when determining which class of Shares best
meets their investment objective. The minimum initial investment
is $100 ($25 minimum for subsequent investments).
PROSPECTUS INFORMATION
This Prospectus sets forth concisely information about the
Funds that a prospective investor ought to know before investing.
Investors are advised to read and retain this Prospectus for
future reference. A Statement of Additional Information ("SAI")
dated May __, 1995, has been filed with the Securities and
Exchange Commission and is incorporated in its entirety by
reference in and made a part of this Prospectus. The SAI is
available without charge upon request to Franklin Templeton
<PAGE>
Distributors, Inc., 700 Central Avenue, St. Petersburg, Florida
33701-3628 or by calling the Account Services Department.
ACCOUNT SERVICES DEPARTMENT - 1-800-354-9191 or 813-823-8712
TEMPLETON "STAR" SERVICE (24 hours, seven days a week access to
current prices, shareholder account balances/values, last
transaction and duplicate account statements) - 1-800-654-0123
<PAGE>
TABLE OF CONTENTS
Page
EXPENSE TABLE . . . . . . 2
GENERAL DESCRIPTION . . . 3
INVESTMENT OBJECTIVES
AND POLICIES . . . . . . 4
INVESTMENT TECHNIQUES . . 12
Temporary Investments . 12
Borrowing . . . . . . . 12
Loans of Portfolio
Securities . . . . . . 14
Options on Securities
or Indices . . . . . . 14
Forward Foreign Currency
Contracts
and Options on Foreign
Currencies . . . . . . . 15
Futures Contracts . . . 18
Repurchase Agreements . 19
Depositary Receipts . . 19
Illiquid and Restricted
Securities . . . . . . . 20
Structured Investments 22
Investment Companies . 24
RISK FACTORS . . . . . . 24
HOW TO BUY SHARES
OF THE FUNDS . . . . . . 31
Alternative Purchase
Arrangements . . . . . . 31
Class I . . . . . . . . 31
Class II . . . . . . . 32
Deciding Which Class to
Purchase . . . . . . . . 33
Purchase Price of Fund
Shares . . . . . . . . . 34
Class I . . . . . . . . 35
Cumulative Quantity
Discount . . . . . . . 39
Letter of Intent . . . 41
Group Purchases . . . . 42
Class II . . . . . . . 43
Net Asset Value Purchases
(Both Classes) . . . 44
Purchasing Class I and
Class II Shares . . . . 48
Automatic Investment Plan 50
Institutional Accounts 50
Account Statements . . 50
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Templeton STAR Service 51
Retirement Plans . . . 51
Net Asset Value . . . . 52
EXCHANGE PRIVILEGE . . . 53
Exchanges of Class II
Shares . . . . . . . 56
Conversion Rights . . 58
Exchanges by Timing
Accounts . . . . . . . . 58
HOW TO SELL SHARES
OF THE FUNDS . . . . . 60
Contingent Deferred Sales 60
Reinstatement Privilege 69
Systematic Withdrawal
Plan . . . . . . . . 70
Redemptions by Telephone 72
TELEPHONE TRANSACTIONS . 73
Verification Procedures 74
Restricted Accounts . 74
General . . . . . . . 75
MANAGEMENT OF THE FUNDS . 76
Investment Manager . 76
Business Manager . . 79
Transfer Agent . . . 80
Custodian . . . . . . 80
Plans of Distribution 80
Brokerage Commissions 82
GENERAL INFORMATION . . . 83
Description of
Shares/Share Certificates 83
Meetings of Shareholders 83
Dividends and
Distributions . . . 84
Federal Tax Information 85
Inquiries . . . . . . 87
Performance Information 87
Statements and Reports 88
WITHHOLDING INFORMATION . --
CORPORATE RESOLUTION . . _
AUTHORIZATION AGREEMENT . _
THE FRANKLIN TEMPLETON GROUP _
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Shares of the Funds are not deposits or obligations of, or
guaranteed or endorsed by, any bank; further, such shares are not
federally insured by the Federal Deposit Insurance Corporation,
the Federal Reserve Board, or any other agency.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<PAGE>
EXPENSE TABLE
Greater European Fund Latin America Fund
Shareholder Transaction Expenses Class IClass II Class I Class II
Maximum Sales Load Imposed on Purchases
(as a percentage of Offering Price) . 5.75% 1.00%1 5.75% 1.00%1
Maximum Sales Charge Imposed on
Reinvested Dividends . . None None None None
Deferred Sales Charge . . None2 1.00%3 None2 1.00%3
Annual Fund Operating Expenses
(as a percentage of average net assets)
Management Fees . . . . . . ____% ____% ____% ____%
12b-1 Fees . . . . . . . . ____%4 1.00%4 ____%4 1.00%4
Other Expenses (audit, legal,
business management,
transfer agent and custodian)
(after expense reimbursement) . ____% ____% ____% ____%
Total Fund Operating Expenses
(after expense reimbursement) . ____% ____% ____% ____%
You would pay the following expenses 1 Year 3 Years
on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption Class I Class II5 Class I Class II5
Maximum Sales Load Imposed on Pu
at the end of each time period:
Greater European Fund . . . $______ $______ $______ $______
Latin America Fund . . . . $______ $______ $______ $______
_________________________
1 Although Class II has a lower initial sales charge than Class
I, over time the higher 12b-1 fee for Class II may cause
Shareholders to pay more for Class II Shares than for Class I
Shares. Given each Fund's maximum initial sales charge and
the rate of each Fund's Rule 12b-1 fee, however, it is
estimated that this would take a substantial number of years.
<PAGE>
2 A contingent deferred sales charge of 1% may be imposed,
however, on certain redemptions of Class I Shares initially
purchased without a sales charge as described in the
Prospectus under "How to Sell Shares of the Funds."
3 Class II Shares redeemed within eighteen months of purchase
are subject to a 1% contingent deferred sales charge. After
the eighteen month period, however, the Shares may be
redeemed free of the charge.
4 Consistent with the National Association of Securities
Dealers, Inc.'s rules, it is possible that the combination of
front-end sales charges and Rule 12b-1 fees could cause long-
term Shareholders to pay more than the economic equivalent of
the maximum front-end sales charges permitted under those
same rules.
5 As noted in the table above, Class II Shares are generally
subject to a contingent deferred sales charge for a period of
18 months.
<PAGE>
The information in the table above is an estimate based on
the Funds' expected expenses for the current fiscal year and is
provided for purposes of assisting current and prospective
Shareholders in understanding the various costs and expenses that
an investor in the Funds will bear, directly or indirectly. The
information in the table does not reflect the charge of up to $15
per transaction if a Shareholder requests that redemption
proceeds be sent by express mail or wired to a commercial bank
account or an administrative service fee of $5.00 per exchange
for market timing or allocation service accounts. The 5% annual
return and annual expenses should not be considered a
representation of actual or expected Fund performance or
expenses, both of which may vary. For a more detailed discussion
of the Funds' fees and expenses, see "Management of the Funds."
The Funds' Business Manager, Templeton Global Investors,
Inc., has voluntarily agreed to limit the total expenses
(excluding interest, taxes, brokerage commissions and
extraordinary expenses) of each Fund to an annual rate of 1.25%
of the Fund's average daily net assets until [December 31, 1995].
If this policy were not in effect, the Funds' "Other Expenses"
and "Total Fund Operating Expenses" would be as follows: _____%
and _____%, respectively, for Greater European Fund and _____%
and _____%, respectively, for Latin America Fund. If the policy
were not in effect, the estimated expenses on a $1,000
investment, assuming 5% annual return and redemption at the end
of each time period would be as follows: Greater European Fund
-- $_____ for one year and $_____ for three years, and Latin
<PAGE>
America Fund -- $__ for one year and $___ for three years. As
long as this temporary expense limitation continues, it may lower
each Fund's expenses and increase its total return. After
[December 31, 1995], the expense limitation may be terminated or
revised at any time, at which time each Fund's expenses may
increase and its total return may be reduced, depending on the
total assets of the Fund.
GENERAL DESCRIPTION
Templeton Global Investment Trust (the "Trust") was organized
as a business trust under the laws of Delaware on December 21,
1993 and is registered under the Investment Company Act of 1940,
as amended (the "1940 Act") as an open-end management investment
company. In addition to the Funds, both of which are diversified
funds, the Trust has three series of Shares: Templeton Americas
Government Securities Fund, a non-diversified fund, and Templeton
Global Rising Dividends Fund and Templeton Global Infrastructure
Fund, both diversified funds. Prospectuses for Templeton
Americas Government Securities Fund, Templeton Global Rising
Dividends Fund and Templeton Global Infrastructure Fund are
available upon request and without charge from the Principal
Underwriter.
Shares of the Funds may be purchased (minimum investment of
$100 initially and $25 thereafter) at the current public offering
price which is equal to each Fund's net asset value (see "Net
Asset Value") plus a sales charge based upon a variable
<PAGE>
percentage (ranging from 5.75% to less than 1.00% of the offering
price) depending on factors such as the class of Shares purchased
and the amount invested. (See "How to Buy Shares of the Funds.")
INVESTMENT OBJECTIVES AND POLICIES
Greater European Fund has as its investment objective long-
term capital appreciation. The Fund seeks to achieve its
objective by investing primarily in equity securities (as defined
below) of Greater European Companies. As used in this
Prospectus, the term "Greater European Company" means a company
(i) that is organized under the laws of, [or with a principal
office in] a country in Greater Europe, (ii) for which the
principal equity securities trading market is in Greater Europe,
or (iii) that derives at least 50% of its revenues or profits
from goods produced or sold, investments made, or services
performed in Greater Europe or that has at least 50% of its
assets situated in Greater Europe. As used in this Prospectus,
the term "Greater Europe" means Western, Central and Eastern
Europe (including Ukraine, Byelorussia, Latvia, Lithuania and
Estonia) and Russia. Under normal market conditions, the Fund
will invest at least 75% of its total assets in the equity
securities of Greater European Companies. The balance of the
Fund's assets will be invested in (i) debt securities (as defined
below) issued by Greater European Companies or issued or
guaranteed by Greater European government entities, (ii) equity
securities and debt obligations of issuers outside Greater
Europe, and (iii) short-term and medium term debt securities of
<PAGE>
the type described below under "Investment Techniques - Temporary
Investments."
Latin America Fund has as its investment objective long-term
capital appreciation. The Fund seeks to achieve its objective by
investing primarily in equity and debt securities of issuers in
the following Latin American countries: Argentina, Belize,
Bolivia, Brazil, Chile, Colombia, Costa Rica, Cuba, Ecuador, El
Salvador, French Guyana, Guatemala, Guyana, Honduras, Mexico,
Nicaragua, Panama, Paraguay, Peru, Surinam, Trinidad/Tobago,
Uruguay, and Venezuela. Under normal market conditions, the Fund
will invest at least 65% of its total assets in equity and debt
securities of issuers in the countries named above. The balance
of the Fund's assets will be invested in (i) equity securities
and debt obligations of companies and government entities of
countries other than those named above, and (ii) short-term and
medium term debt securities of the type described below under
"Investment Techniques - Temporary Investments."
Information Regarding Both Funds
Each Fund's investment objective and the investment
restrictions set forth under "Investment Objectives and Policies
-- Investment Restrictions" in the SAI are fundamental and may
not be changed without Shareholder approval. All other
investment policies and practices described in this Prospectus
are not fundamental, and may be changed by the Board of Trustees
<PAGE>
without Shareholder approval. There can be no assurance that
either Fund's investment objective will be achieved.
As used in this Prospectus, "equity securities" refers to
common stock, preferred stock, securities convertible into or
exchangeable for such securities, warrants or rights to subscribe
to or purchase such securities, and sponsored or unsponsored
American Depositary Receipts ("ADRs"), European Depositary
Receipts ("EDRs") and Global Depositary Receipts ("GDRs")
(collectively, "Depositary Receipts"). For capital appreciation,
Greater European Fund may invest up to 25% its total assets, and
Latin America Fund may invest without limit, in debt securities
(defined as bonds, notes, debentures, commercial paper, time
deposits and bankers' acceptances) which are rated in any rating
category by Moody's Investors Service, Inc. ("Moody's") or
Standard & Poor's Corporation ("S&P") or which are unrated by any
rating agency. Such securities may include high risk, lower
quality debt securities, commonly referred to as "junk bonds."
See "Risk Factors." As an operating policy, which may be changed
by the Board of Trustees, neither Fund will invest more than 5%
of its total assets in debt securities rated lower than Baa by
Moody's or BBB by S&P. Certain debt securities can provide the
potential for capital appreciation based on various factors such
as changes in interest rates, economic and market conditions,
improvement in an issuer's ability to repay principal and pay
interest, and ratings upgrades. Additionally, convertible bonds
offer the potential for capital appreciation through the
conversion feature, which enables the holder of the bond to
<PAGE>
benefit from increases in the market price of the securities into
which they are convertible. Debt securities are subject to
certain market and credit risks. See "Investment Objectives and
Policies -- Debt Securities" in the SAI.
The Funds' investment manager, Templeton Galbraith &
Hansberger Ltd., (the "Investment Manager") will select equity
investments for the Funds on the basis of fundamental company-
by-company analysis (rather than broader analyses of specific
industries or sectors of the economy). Although the Investment
Manager will consider historical value measures, such as
price/earnings ratios, operating profit margins and liquidation
values, the primary factor in selecting equity securities will be
the company's current price relative to its long-term earnings
potential, or real book value, as determined by the Investment
Manager. Securities considered for purchase by the Fund may be
listed or unlisted, and may be issued by companies in various
industries, with various levels of market capitalization. The
Investment Manager will actively manage the Funds' assets in
response to market, political and general economic conditions,
and will seek to adjust each Fund's investments based on its
perception of which investments would best enable the Fund to
achieve its investment objective.
As a diversified investment company, each Fund may invest no
more than 5% of its total assets in securities issued by any one
company or government, exclusive of U.S. Government securities.
Although a Fund may invest up to 25% of its assets in a single
<PAGE>
industry, the Funds have no present intention of doing so. A
Fund may not invest more than 5% of its assets in warrants
(exclusive of warrants acquired in units or attached to
securities) or more than 15% of its assets in securities with a
limited trading market.
Each Fund may lend its portfolio securities and borrow money
for investment purposes (i.e., "leverage" its portfolio). In
addition, each Fund may enter into transactions in options on
securities, securities indices and foreign currencies, forward
foreign currency contracts, and futures contracts and related
options. These are generally referred to as derivative
instruments, and involve special risk factors, which are
described below. When deemed appropriate by the Investment
Manager, the Funds may invest cash balances in repurchase
agreements and other money market investments to maintain
liquidity in an amount to meet expenses or for day-to-day
operating purposes. These investment techniques are described
below and under the heading "Investment Objectives and Policies"
in the SAI.
When the Investment Manager believes that market conditions
warrant, either Fund may adopt a temporary defensive position and
may invest without limit in money market securities denominated
in U.S. dollars or in the currency of any foreign country. See
"Investment Techniques -- Temporary Investments."
<PAGE>
The Funds do not emphasize short-term trading profits and
usually expect to have an annual portfolio turnover rate
generally less than 100%.
Brady Bonds. The Latin America Fund may invest without limit
in certain debt obligations customarily referred to as "Brady
Bonds," which are created through the exchange of existing
commercial bank loans to sovereign entities for new obligations
in connection with debt restructuring under a plan introduced by
former U.S. Secretary of the Treasury, Nicholas F. Brady (the
"Brady Plan"). Brady Bonds are not considered U.S. Government
securities and are considered speculative. Brady Plan debt
restructurings have been implemented to date in several
countries, including Argentina, Brazil, Bulgaria, Costa Rica, the
Dominican Republic, Jordan, Mexico, Nigeria, the Philippines,
Uruguay, and Venezuela (collectively, the "Brady Countries").
Ecuador has reached an agreement with its lending banks, but the
full consummation of Ecuador's Brady Plan is still pending. It
is expected that other countries will undertake a Brady Plan debt
restructuring in the future, including Panama, Peru, and Poland.
Brady Bonds have been issued only recently, and, accordingly,
do not have a long payment history. They may be collateralized
or uncollateralized and issued in various currencies (although
most are U.S. dollar-denominated) and they are actively traded in
the over-the-counter secondary market.
<PAGE>
U.S. dollar-denominated, collateralized Brady Bonds, which
may be fixed par bonds or floating rate discount bonds, are
generally collateralized in full as to principal by U.S. Treasury
zero coupon bonds which have the same maturity as the Brady
Bonds. Interest payments on these Brady Bonds generally are
collateralized on a one-year or longer rolling-forward basis by
cash or securities in an amount that, in the case of fixed rate
bonds, is equal to at least one year of interest payments or, in
the case of floating rate bonds, initially is equal to at least
one year's interest payments based on the applicable interest
rate at that time and is adjusted at regular intervals
thereafter. Certain Brady Bonds are entitled to "value recovery
payments" in certain circumstances, which in effect constitute
supplemental interest payments but generally are not
collateralized. Brady Bonds are often viewed as having three or
four valuation components: (i) the collateralized repayment of
principal at final maturity; (ii) the collateralized interest
payments; (iii) the uncollateralized interest payments; and (iv)
any uncollateralized repayment of principal at maturity (these
uncollateralized amounts constitute the "residual risk").
Most Mexican Brady Bonds issued to date have principal
repayments at final maturity fully collateralized by U.S.
Treasury zero coupon bonds (or comparable collateral denominated
in other currencies) and interest coupon payments collateralized
on an 18-month rolling-forward basis by funds held in escrow by
an agent for the bondholders. A significant portion of the
Venezuelan Brady Bonds and the Argentine Brady Bonds issued to
<PAGE>
date have principal repayments at final maturity collateralized
by U.S. Treasury zero coupon bonds (or comparable collateral
denominated in other currencies) and/or interest coupon payments
collateralized on a 14-month (for Venezuela) or 12-month (for
Argentina) rolling-forward basis by securities held by the
Federal Reserve Bank of New York as collateral agent.
Brady Bonds involve various risk factors including residual
risk and the history of defaults with respect to commercial bank
loans by public and private entities of countries issuing Brady
Bonds. There can be no assurance that Brady Bonds in which the
Latin America Fund may invest will not be subject to
restructuring arrangements or to requests for new credit, which
may cause the Fund to suffer a loss of interest or principal on
any of its holdings.
INVESTMENT TECHNIQUES
Temporary Investments. For temporary defensive purposes,
each Fund may invest up to 100% of its total assets in the
following money market securities, denominated in U.S. dollars or
in the currency of any foreign country, issued by entities
organized in the United States or any foreign country: short-
term (less than twelve months to maturity) and medium-term (not
greater than five years to maturity) obligations issued or
guaranteed by the U.S. Government or the governments of foreign
countries, their agencies or instrumentalities; finance company
and corporate commercial paper, and other short-term corporate
<PAGE>
obligations, in each case rated Prime-1 by Moody's or A or better
by S&P or, if unrated, of comparable quality as determined by the
Investment Manager; obligations (including certificates of
deposit, time deposits and bankers' acceptances) of banks; and
repurchase agreements with banks and broker-dealers with respect
to such securities.
Borrowing. Each Fund may borrow up to one-third of the value
of its total assets from banks to increase its holdings of
portfolio securities. Under the 1940 Act, a Fund is required to
maintain continuous asset coverage of 300% with respect to such
borrowings and to sell (within three days) sufficient portfolio
holdings to restore such coverage if it should decline to less
than 300% due to market fluctuations or otherwise, even if such
liquidations of a Fund's holdings may be disadvantageous from an
investment standpoint. Leveraging by means of borrowing may
exaggerate the effect of any increase or decrease in the value of
portfolio securities on a Fund's net asset value, and money
borrowed will be subject to interest and other costs (which may
include commitment fees and/or the cost of maintaining minimum
average balances) which may or may not exceed the income received
from the securities purchased with borrowed funds.
Loans of Portfolio Securities. Each Fund may lend to broker-
dealers portfolio securities with an aggregate market value of up
to one-third of the Fund's total assets to generate income for
the purpose of offsetting operating expenses. Such loans must be
secured by collateral (consisting of any combination of cash,
<PAGE>
U.S. Government securities or irrevocable letters of credit) in
an amount at least equal (on a daily marked-to-market basis) to
the current market value of the securities loaned. A Fund may
terminate the loans at any time and obtain the return of the
securities loaned within five business days. A Fund will
continue to receive any interest or dividends paid on the loaned
securities and will continue to retain any voting rights with
respect to the securities. In the event that the borrower
defaults on its obligation to return borrowed securities, because
of insolvency or otherwise, a Fund could experience delays and
costs in gaining access to the collateral and could suffer a loss
to the extent that the value of the collateral falls below the
market value of the borrowed securities.
Options on Securities or Indices. Each Fund may write (i.e.,
sell) covered put and call options and purchase put and call
options on securities or securities indices that are traded on
United States and foreign exchanges or in the over-the-counter
markets. An option on a security is a contract that permits the
purchaser of the option, in return for the premium paid, the
right to buy a specified security (in the case of a call option)
or to sell a specified security (in the case of a put option)
from or to the writer of the option at a designated price during
the term of the option. An option on a securities index permits
the purchaser of the option, in return for the premium paid, the
right to receive from the seller cash equal to the difference
between the closing price of the index and the exercise price of
the option. A Fund may write a call or put option only if the
<PAGE>
option is "covered." This means that so long as a Fund is
obligated as the writer of a call option, it will own the
underlying securities subject to the call, or hold a call at the
same or lower exercise price, for the same exercise period, and
on the same securities as the written call. A put is covered if
a Fund maintains liquid assets with a value equal to the exercise
price in a segregated account, or holds a put on the same
underlying securities at an equal or greater exercise price. The
value of the underlying securities on which options may be
written at any one time will not exceed 15% of the total assets
of a Fund. A Fund will not purchase put or call options if the
aggregate premium paid for such options would exceed 5% of its
total assets at the time of purchase.
Forward Foreign Currency Contracts and Options on Foreign
Currencies. The Funds will normally conduct foreign currency
exchange transactions either on a spot (i.e., cash) basis at the
spot rate prevailing in the foreign currency exchange market, or
through entering into forward contracts to purchase or sell
foreign currencies. The Funds will generally not enter into a
forward contract with a term of greater than one year. A forward
contract is an obligation to purchase or sell a specific currency
for an agreed price at a future date which is individually
negotiated and privately traded by currency traders and their
customers.
The Funds will generally enter into forward contracts only
under two circumstances. First, when a Fund enters into a
<PAGE>
contract for the purchase or sale of a security denominated in a
foreign currency, it may desire to "lock in" the U.S. dollar
price of the security in relation to another currency by entering
into a forward contract to buy the amount of foreign currency
needed to settle the transaction. Second, when the Investment
Manager believes that the currency of a particular foreign
country may suffer or enjoy a substantial movement against
another currency, it may enter into a forward contract to sell or
buy the former foreign currency (or another currency which acts
as a proxy for that currency) approximating the value of some or
all of the Fund's portfolio securities denominated in such
foreign currency. This second investment practice is generally
referred to as "cross-hedging." The Funds have no specific
limitation on the percentage of assets they may commit to forward
contracts, subject to their stated investment objective and
policies, except that a Fund will not enter into a forward
contract if the amount of assets set aside to cover forward
contracts would impede portfolio management or the Fund's ability
to meet redemption requests. Although forward contracts will be
used primarily to protect the Funds from adverse currency
movements, they also involve the risk that anticipated currency
movements will not be accurately predicted.
The Funds may purchase put and call options and write covered
put and call options on foreign currencies for the purpose of
protecting against declines in the U.S. dollar value of foreign
currency denominated portfolio securities and against increases
in the U.S. dollar cost of such securities to be acquired. As in
<PAGE>
the case of other kinds of options, however, the writing of an
option on a foreign currency constitutes only a partial hedge, up
to the amount of the premium received, and a Fund could be
required to purchase or sell foreign currencies at
disadvantageous exchange rates, thereby incurring losses. The
purchase of an option on a foreign currency may constitute an
effective hedge against fluctuations in exchange rates although,
in the event of rate movements adverse to a Fund's position, it
may forfeit the entire amount of the premium plus related
transaction costs. Options on foreign currencies to be written
or purchased by the Funds are traded on U.S. and foreign
exchanges or over-the-counter.
Futures Contracts. For hedging purposes only, the Funds may
buy and sell financial futures contracts, stock and bond index
futures contracts, foreign currency futures contracts and options
on any of the foregoing. A financial futures contract is an
agreement between two parties to buy or sell a specified debt
security at a set price on a future date. An index futures
contract is an agreement to take or make delivery of an amount of
cash based on the difference between the value of the index at
the beginning and at the end of the contract period. A futures
contract on a foreign currency is an agreement to buy or sell a
specified amount of a currency for a set price on a future date.
When a Fund enters into a futures contract, it must make an
initial deposit, known as "initial margin," as a partial
guarantee of its performance under the contract. As the value of
<PAGE>
the security, index or currency fluctuates, either party to the
contract is required to make additional margin payments, known as
"variation margin," to cover any additional obligation it may
have under the contract. In addition, when a Fund enters into a
futures contract, it will segregate assets or "cover" its
position in accordance with the 1940 Act. See "Investment
Objective and Policies -- Futures Contracts" in the SAI.
Repurchase Agreements. For temporary defensive purposes and
for cash management purposes, the Funds may enter into repurchase
agreements with U.S. banks and broker-dealers. Under a
repurchase agreement, a Fund acquires a security from a U.S. bank
or a registered broker-dealer and simultaneously agrees to resell
the security back to the bank or broker-dealer at a specified
time and price. The repurchase price is in excess of the
original purchase price paid by a Fund by an amount which
reflects an agreed-upon rate of return and which is not tied to
any coupon rate on the underlying security. Under the 1940 Act,
repurchase agreements are considered to be loans collateralized
by the underlying security and therefore will be fully colla-
teralized. However, if the bank or broker-dealer should default
on its obligation to repurchase the underlying security, a Fund
may experience a delay or difficulties in exercising its rights
to realize upon the security and might incur a loss if the value
of the security declines, as well as disposition costs in
liquidating the security.
<PAGE>
Depositary Receipts. ADRs are Depositary Receipts typically
used by a U.S. bank or trust company which evidence ownership of
underlying securities issued by a foreign corporation. EDRs and
GDRs are typically issued by foreign banks or trust companies,
although they also may be issued by U.S. banks or trust
companies, and evidence ownership of underlying securities issued
by either a foreign or a United States corporation. Generally,
Depositary Receipts in registered form are designed for use in
the U.S. securities market and Depositary Receipts in bearer form
are designed for use in securities markets outside the United
States. Depositary Receipts may not necessarily be denominated
in the same currency as the underlying securities into which they
may be converted. In addition, the issuers of the securities
underlying unsponsored Depositary Receipts are not obligated to
disclose material information in the United States and,
therefore, there may be less information available regarding such
issuers and there may not be a correlation between such
information and the market value of the Depositary Receipts.
Depositary Receipts also involve the risks of other investments
in foreign securities, as discussed below. For purposes of a
Fund's investment policies, the Fund's investments in Depositary
Receipts will be deemed to be investments in the underlying
securities.
Illiquid and Restricted Securities. Each Fund may invest up
to 15% of its total assets in illiquid securities, for which
there is a limited trading market and for which a low trading
volume of a particular security may result in abrupt and erratic
<PAGE>
price movements. A Fund may be unable to dispose of its holdings
in illiquid securities at then current market prices and may have
to dispose of such securities over extended periods of time. A
Fund may also invest in securities that are sold (i) in private
placement transactions between their issuers and their purchasers
and that are neither listed on an exchange nor traded over-the-
counter, or (ii) in transactions between qualified institutional
buyers pursuant to Rule 144A under the U.S. Securities Act of
1933, as amended. Such restricted securities are subject to
contractual or legal restrictions on subsequent transfer. As a
result of the absence of a public trading market, such restricted
securities may in turn be less liquid and more difficult to value
than publicly traded securities. Although these securities may
be resold in privately negotiated transactions, the prices
realized from the sales could, due to illiquidity, be less than
those originally paid by a Fund or less than their fair value.
In addition, issuers whose securities are not publicly traded may
not be subject to the disclosure and other investor protection
requirements that may be applicable if their securities were
publicly traded. If any privately placed or Rule 144A securities
held by a Fund are required to be registered under the securities
laws of one or more jurisdictions before being resold, a Fund may
be required to bear the expenses of registration. Each Fund will
limit its investment in restricted securities other than Rule
144A securities to 10% of its total assets, and will limit its
investment in all restricted securities, including 144A
securities, to 15% of its total assets. Restricted securities,
other than rule 144A securities determined by the Board of
<PAGE>
Trustees to be liquid, are considered to be illiquid and are
subject to a Fund's limitation on investment in illiquid
securities.
Structured Investments. Included among the issuers of debt
securities in which the Funds may invest are entities organized
and operated solely for the purpose of restructuring the
investment characteristics of various securities. These entities
are typically organized by investment banking firms which receive
fees in connection with establishing each entity and arranging
for the placement of its securities. This type of restructuring
involves the deposit with or purchase by an entity, such as a
corporation or trust, of specified instruments and the issuance
by that entity of one or more classes of securities ("Structured
Investments") backed by, or representing interests in, the
underlying instruments. The cash flow on the underlying
instruments may be apportioned among the newly issued Structured
Investments to create securities with different investment
characteristics such as varying maturities, payment priorities or
interest rate provisions; the extent of the payments made with
respect to Structured Investments is dependent on the extent of
the cash flow on the underlying instruments. Because Structured
Investments of the type in which the Funds anticipate investing
typically involve no credit enhancement, their credit risk will
generally be equivalent to that of the underlying instruments.
The Funds are permitted to invest in a class of Structured
Investments that is either subordinated or unsubordinated to the
<PAGE>
right of payment of another class. Subordinated Structured
Investments typically have higher yields and present greater
risks than unsubordinated Structured Investments. Although the
Fund's purchase of subordinated Structured Investments would have
a similar economic effect to that of borrowing against the
underlying securities, the purchase will not be deemed to be
leverage for purposes of the limitations placed on the extent of
the Fund's assets that may be used for borrowing activities.
Certain issuers of Structured Investments may be deemed to be
"investment companies" as defined in the 1940 Act. As a result,
a Fund's investment in these Structured Investments may be
limited by the restrictions contained in the 1940 Act described
below under "Investment Companies." Structured Investments are
typically sold in private placement transactions, and there
currently is no active trading market for Structured Investments.
To the extent such investments are illiquid, they will be subject
to the restrictions set forth in the SAI under "Investment
Objectives and Policies -- Investment Restrictions."
Investment Companies. Each Fund may invest in other
investment companies, except those for which the Investment
Manager serves as investment adviser or sponsor, which invest
principally in securities in which the Fund is authorized to
invest. Under the 1940 Act, each Fund may invest a maximum of
10% of its total assets in the securities of other investment
companies and not more than 5% of each Fund's total assets in the
securities of any one investment company, provided the investment
<PAGE>
does not represent more than 3% of the voting stock of the
acquired investment company at the time such shares are
purchased. To the extent a Fund invests in other investment
companies, a Fund's shareholders will incur certain duplicative
fees and expenses, including investment advisory fees. A Fund's
investment in certain investment companies will result in special
U.S. federal income tax consequences described below under "Tax
Status" in the SAI.
<PAGE> RISK FACTORS
Shareholders should understand that all investments involve
risk and there can be no guarantee against loss resulting from an
investment in the Funds, nor can there be any assurance that a
Fund's investment objective will be attained. As with any
investment in securities, the value of, and income from, an
investment in a Fund can decrease as well as increase, depending
on a variety of factors which may affect the values and income
generated by a Fund's portfolio securities, including general
economic conditions and market factors. In addition to the
factors which affect the value of individual securities, a
Shareholder may anticipate that the value of the Shares of a Fund
will fluctuate with movements in the broader equity and bond
markets, as well. A decline in the stock market of any country
in which a Fund is invested may also be reflected in declines in
the price of the Fund's Shares. Because many of the Funds'
investments are denominated in foreign currencies, changes in
currency valuations will also affect the prices of the Funds'
Shares. History reflects both decreases and increases in
<PAGE>
worldwide stock markets and currency valuations, and these may
reoccur unpredictably in the future. Additionally, investment
decisions made by the Investment Manager will not always be
profitable or prove to have been correct. Neither Fund is
intended as a complete investment program.
Foreign Currency Exchange. Since the Funds are authorized to
invest in securities denominated or quoted in currencies other
than the U.S. dollar, changes in foreign currency exchange rates
relative to the U.S. dollar will affect the value of securities
in the respective portfolios and the unrealized appreciation or
depreciation of investments insofar as U.S. investors are
concerned. Changes in foreign currency exchange rates relative
to the U.S. dollar will also affect a Fund's yield on assets
denominated in currencies other than the U.S. dollar. The Funds
usually effect currency exchange transactions on a spot (i.e.,
cash) basis at the spot rate prevailing in the foreign exchange
market. However, some price spread on currency exchange
transactions (to cover service charges) will be incurred when a
Fund converts assets from one currency to another.
Foreign Investments. The Funds have the right to purchase
securities in any foreign country, developed or underdeveloped.
Investors should consider carefully the substantial risks
involved in investing in securities issued by companies and
governments of foreign nations, which are in addition to the
usual risks inherent in domestic investments. Each Fund's
performance is closely tied to economic and political conditions
<PAGE>
within the geographic area of its respective investments. Some
of the countries in which the Funds may invest are considered
emerging markets, in which the risks generally associated with
foreign investments are heightened. There is the possibility of
expropriation, nationalization or confiscatory taxation, taxation
of income earned in foreign nations (including, for example,
withholding taxes on interest and dividends) or other taxes
imposed with respect to investments in foreign nations, foreign
exchange controls (which may include suspension of the ability to
transfer currency from a given country), political or social
instability or diplomatic developments which could affect
investment in securities of issuers in foreign nations. Some
countries may withhold portions of interest and dividends at the
source. In addition, in many countries there is less publicly
available information about issuers than is available in reports
about companies in the United States. Foreign companies are not
generally subject to uniform accounting, auditing and financial
reporting standards, and auditing practices and requirements may
not be comparable to those applicable to United States companies.
Further, the Funds may encounter difficulties or be unable to
pursue legal remedies and obtain judgments in foreign courts.
Commission rates in foreign countries, which are sometimes fixed
rather than subject to negotiation as in the United States, are
likely to be higher. Foreign securities markets also have
different clearance and settlement procedures, and in certain
markets there have been times when settlements have been unable
to keep pace with the volume of securities transactions, making
it difficult to conduct such transactions. Delays in settlement
<PAGE>
could result in temporary periods when assets of a Fund are
uninvested and no return is earned thereon. The inability of a
Fund to make intended security purchases due to settlement
problems could cause a Fund to miss attractive investment
opportunities. Inability to dispose of portfolio securities due
to settlement problems could result either in losses to a Fund
due to subsequent declines in value of the portfolio security or,
if a Fund has entered into a contract to sell the security, could
result in possible liability to the purchaser. Greater European
Fund's proposed investments in Russia are subject to the risk of
total loss due to Russia's unusual system of share registration
and settlement, which is discussed in the SAI under the caption
"Investment Objectives and Policies - Risk Factors." In many
foreign countries there is less government supervision and
regulation of business and industry practices, stock exchanges,
brokers and listed companies than in the United States. The
foreign securities markets of many of the countries in which a
Fund may invest may also be smaller, less liquid, and subject to
greater price volatility than those in the United States. As an
open-end investment company, each Fund is limited in the extent
to which it may invest in illiquid securities. See "Investment
Objectives and Policies - Risk Factors" in the SAI.
High Risk Debt Securities. The Funds are authorized to
invest in debt securities rated in any category by S&P or Moody's
and securities which are unrated by any rating agency. See
"Investment Objectives and Policies -- Debt Securities" in the
SAI. As an operating policy, which may be changed by the Board
<PAGE>
of Trustees without Shareholder approval, a Fund will not invest
more than 5% of its total assets in debt securities rated lower
than BBB by S&P or Baa by Moody's. The Board of Trustees may
consider a change in this operating policy if, in its judgment,
economic conditions change such that a higher level of investment
in high risk, lower quality debt securities would be consistent
with the interests of a Fund and its Shareholders. High risk,
lower quality debt securities, commonly referred to as "junk
bonds," are regarded, on balance, as predominantly speculative
with respect to the issuer's capacity to pay interest and repay
principal in accordance with the terms of the obligation and may
be in default. Unrated debt securities are not necessarily of
lower quality than rated securities, but they may not be
attractive to as many buyers. Regardless of rating levels, all
debt securities considered for purchase (whether rated or
unrated) will be carefully analyzed by the Investment Manager to
insure, to the extent possible, that the planned investment is
sound. Each Fund may, from time to time, invest up to 5% of its
total assets in defaulted debt securities if, in the opinion of
the Investment Manager, the issuer may resume interest payments
in the near future.
Leverage. Leveraging by means of borrowing may exaggerate
the effect of any increase or decrease in the value of portfolio
securities on a Fund's net asset value, and money borrowed will
be subject to interest and other costs (which may include
commitment fees and/or the cost of maintaining minimum average
balances) which may or may not exceed the income received from
<PAGE>
the securities purchased with borrowed funds. The use of
leverage may significantly increase a Fund's investment risk.
Futures Contracts and Related Options. Successful use of
futures contracts and related options is subject to special risk
considerations. A liquid secondary market for any futures or
options contract may not be available when a futures or options
position is sought to be closed. In addition, there may be an
imperfect correlation between movements in the securities or
foreign currency on which the futures or options contract is
based and movements in the securities or currency in a Fund's
portfolio. Successful use of futures or options contracts is
further dependent on the Investment Manager's ability to
correctly predict movements in the securities or foreign currency
markets, and no assurance can be given that its judgment will be
correct. Successful use of options on securities or stock
indices is subject to similar risk considerations. In addition,
by writing covered call options, a Fund gives up the opportunity,
while the option is in effect, to profit from any price increase
in the underlying security above the option exercise price.
There are further risk factors, including possible losses
through the holding of securities in domestic and foreign
custodian banks and depositories, described elsewhere in this
Prospectus and in the SAI.
<PAGE>
HOW TO BUY SHARES OF THE FUNDS
Shares of the Funds may be purchased at the Offering Price
through any broker which has a dealer agreement with Franklin
Templeton Distributors, Inc. ("FTD"), the Principal Underwriter
for Shares of the Funds, or directly from FTD upon receipt by FTD
of a completed Shareholder Application and check. The minimum
initial purchase order is $100 (other than in monthly investment
plans, such as sponsored payroll deduction, automatic investment,
split-funding or comparable plans, which require a minimum of
$25), with subsequent investments of $25 or more.
Alternative Purchase Arrangements. Each Fund offers two
different classes of Shares, each of which has its own initial,
contingent, and Rule 12b-1 sales charge structures. Shareholders
may not convert shares of one class into shares of the other at
this time.
Class I. Class I Shares have higher initial sales charges
than Class II Shares and they have lower yearly asset-based Rule
12b-1 fees. Class I Shares may be purchased at reduced initial
sales charges, or without any initial sales charge at all if
certain conditions are met. In most circumstances, contingent
deferred sales charges will not be assessed against redemptions
of Class I Shares. See "Management of the Funds," "How to Buy
Shares of the Funds," and "How to Sell Shares of the Funds" for
more information.
<PAGE>
Class II. By contrast, Class II Shares have lower initial
fees than Class I Shares and higher yearly Rule 12b-1 charges.
Also, although there are certain exceptions, Class II Shares
redeemed within eighteen months of purchase will generally be
assessed a contingent deferred sales charge of 1% on the lesser
of the then-current net asset value or the original purchase
price of such Shares. See "Contingent Deferred Sales Charge -
Class II Shares" under "How to Sell Shares of the Funds" for a
complete description of the contingent deferred sales charge.
Purchases of Class II Shares are limited to amounts below $1
million. Any purchases of $1 million or more will automatically
be invested in Class I Shares, since the Shareholder may purchase
the Class I Shares at net asset value and take advantage of the
lower annual fees associated with Class I Shares. Shareholders
may retain accounts that have accumulated over $1 million in
Shares over a period of time. Shareholders who intend to make
large investments in the Funds should consider purchasing Class I
Shares through a Letter of Intent instead of purchasing Class II
Shares. With the exception of certain employee benefit plans
described below, however, a Shareholder may maintain an account
balance of an unlimited dollar amount in Class II Shares.
Deciding Which Class to Purchase. Each investor's individual
objectives must be carefully evaluated before determining which
class of Shares will be more beneficial to that investor.
Generally speaking, an investor who expects to invest less than
$100,000 in the Franklin Templeton Funds and who expects to make
<PAGE>
substantial redemptions within six years of investment should
consider Class II Shares. This is because it is more economical
for a Shareholder to invest, for example, $50,000 for two years
in Class II Shares than in Class I Shares. Over time, however,
the higher annual Rule 12b-1 charges on the Class II Shares will
accumulate to outweigh the difference in initial sales charges.
For this reason, Class I Shares may be more attractive to long-
term investors even if no sales charge reductions are available
to them.
Investors who qualify to purchase Class I Shares at reduced
sales charges or at net asset value should consider purchasing
Class I Shares, especially if they intend to hold their Shares
for long periods of time. Similarly, investors who intend to
make large investments in the Funds should consider purchasing
Class I Shares through a Letter of Intent or under Rights of
Accumulation rather than purchasing Class II Shares. Investors
investing over $1 million (in a single payment or through a
Letter of Intent or Rights of Accumulation) will be prohibited
from purchasing Class II Shares because Class I Shares would
always be more beneficial to such investors.
In determining which Shares are more appropriate for a
Shareholder's investment objectives and income needs, a
Shareholder should also consider that the higher Rule 12b-1 fees
for Class II will generally result in lower dividends and
consequently lower yields for Class II Shares as compared to
Class I Shares.
<PAGE>
Each class also has a separate schedule for awarding
compensation to securities dealers for selling Fund Shares. A
Shareholder should take all of the circumstances surrounding each
investment into account before deciding which class of shares to
purchase.
IMPORTANT NOTICE!
THE APPLICATION FORM ATTACHED TO THIS PROSPECTUS MUST BE USED FOR
ALL FUTURE PURCHASES. OLD APPLICATION FORMS SHOULD BE DISCARDED.
Purchase Price of Fund Shares
Shares of the Funds are offered at the public offering price,
which is the net asset value per share plus a sales charge, next
computed (i) after the Shareholder's securities dealer receives
the order which is promptly transmitted to the Funds or (ii)
after receipt of an order by mail from the Shareholder directly
in proper form (which generally means a completed Shareholder
Application accompanied by a negotiable check).
Class I. The sales charge for Class I Shares is a variable
percentage of the offering price depending upon the amount of the
sale. A description of the method of calculating net asset value
per share is included under the caption "Net Asset Value."
Set forth below is a table of total sales charges or
underwriting commissions and dealer concessions for all Class I
Shares of the Funds, including all designated Retirement Plans.
<PAGE>
Class I Shares -- Total Sales Charge
As a percentage As a percentage Portion of total
Amount of of Offering of net asset Offering Price
Sale at Price of the value of the retained by
Offering Price Shares purchased Shares purchased dealers*
Less than $50,000 . . 5.75% 6.10% 5.00%
$50,000 but less than $100,000 . 4.50% 4.71% 3.60%
$100,000 but less than $250,000 . 3.50% 3.63% 2.80%
$250,000 but less than $500,000 . 2.50% 2.56% 2.00%
$500,000 but less than $1,000,000 2.00% 2.04% 1.60%
$1,000,000 or more . none none (see below)**
___________________
* Financial institutions or their affiliated brokers may
receive an agency transaction fee in the percentages set
forth above.
** The following commissions will be paid by FTD, from its own
resources, to securities dealers who initiate and are
responsible for purchases of $1 million or more; 1% on sales
of $1 million but less than $2 million, plus 0.80% on sales
of $2 million but less than $3 million, plus 0.50% on sales
of $3 million but less than $50 million, plus 0.25% on sales
of $50 million but less than $100 million, plus 0.15% on
sales of $100 million or more. Dealer concession
breakpoints are reset every 12 months for purposes of
additional purchases.
FTD, or one of its affiliates, may make payments, from its
own resources, of up to 1% of the amount purchased to securities
dealers who initiate and are responsible for purchases made at
net asset value by certain designated retirement plans (excluding
IRA and IRA rollovers), as defined below, certain non-designated
plans, certain trust companies and trust departments of banks and
certain retirement plans of organizations with collective
<PAGE>
retirement plan assets of $10 million or more). Please refer to
the SAI for further information.
No initial sales charge applies on investments of $1 million
or more, but a contingent deferred sales charge of 1% is imposed
on certain redemptions of investments of $1 million or more
within 12 months of the calendar month following such investments
("contingency period"). See "How to Sell Shares of the Funds -
Contingent Deferred Sales Charge."
At the discretion of FTD, the entire sales commission may at
times be reallowed to dealers. During periods when 90% or more
of the sales commission is reallowed, such dealers may be deemed
to be underwriters as that term is defined in the Securities Act
of 1933.
Cumulative Quantity Discount. The schedule of reduced sales
charges also may be applied to qualifying sales of Class I Shares
on a cumulative basis. For this purpose, the dollar amount of
the sale is added to the higher of (1) the value (calculated at
the applicable Offering Price) or (2) the purchase price, of the
following: (a) Class I Shares of the Funds; (b) Class I Shares
of other funds in the Franklin Templeton Group (except Templeton
Capital Accumulator Fund, Inc., Templeton Variable Annuity Fund,
Templeton Variable Products Series Fund, Franklin Valuemark Funds
and Franklin Government Securities Trust); and (c) other
investment products underwritten by FTD or its affiliates
(although certain investments may not have the same schedule of
<PAGE>
sales charges and/or may not be subject to reduction in sales
charges). Clauses (a), (b) and (c) above are collectively
referred to as "Franklin Templeton Investments." The cumulative
quantity discount applies to Franklin Templeton Investments owned
at the time of purchase by the purchaser, his or her spouse, and
their children under age 21. In addition, the aggregate
investments of a trustee or other fiduciary account (for an
account under exclusive investment authority) may be considered
in determining whether a reduced sales charge is available, even
though there may be a number of beneficiaries of the account.
For example, if the investor held Class I Shares valued at
$40,000 (or, if valued at less than $40,000, had been purchased
for $40,000) and purchased an additional $20,000 of a Fund's
Class I Shares, the sales charge for the $20,000 purchase would
be at the rate of 4.50%. It is FTD's policy to give investors
the best sales charge rate possible; however, there can be no
assurance that an investor will receive the appropriate discount
unless, at the time of placing the purchase order, the investor
or the dealer makes a request for the discount and gives FTD
sufficient information to determine whether the purchase will
qualify for the discount. On telephone orders from dealers for
the purchase of Class I Shares to be registered in "street name,"
FTD will accept the dealer's instructions with respect to the
applicable sales charge rate to be applied. The Cumulative
Quantity Discount may be amended or terminated at any time.
Letter of Intent. Investors may also reduce sales charges
on all investments in Class I Shares by means of a Letter of
<PAGE>
Intent ("LOI") which expresses the investor's intention to invest
a certain amount within a 13-month period in Class I Shares of
the Funds or any other fund in the Franklin Templeton Group
(except Templeton Capital Accumulator Fund, Inc., Templeton
Variable Annuity Fund, Templeton Variable Products Series Fund,
Franklin Valuemark Funds and Franklin Government Securities
Trust). See the Shareholder Application. Except for certain
employee benefit plans, the minimum initial investment under an
LOI is 5% of the total LOI amount. Except for Shares purchased
by certain employee benefit plans, Shares purchased with the
first 5% of such amount will be held in escrow to secure payment
of the higher sales charge applicable to the Shares actually
purchased if the full amount indicated is not purchased, and such
escrowed Shares will be involuntarily redeemed to pay the
additional sales charge, if necessary. A purchase not originally
made pursuant to an LOI may be included under a subsequent LOI
executed within 90 days of the purchase. Any redemptions made by
Shareholders, other than by certain employee benefit plans,
during the 13-month period will be subtracted from the amount of
the purchases for purposes of determining whether the terms of
the LOI have been completed. For a further description of the
LOI, see "Purchase, Redemption and Pricing of Shares - Letter of
Intent" in the SAI.
Group Purchases. An individual who is a member of a
qualified group may also purchase Class I Shares of the Funds at
the reduced sales charge applicable to the group as a whole. The
sales charge is based upon the aggregate dollar value of Class I
<PAGE>
Shares previously purchased and still owned by the group, plus
the amount of the current purchase. For example, if members of
the group had previously invested and still held $80,000 of Class
I Shares and now were investing $25,000, the sales charge would
be 3.50%. Information concerning the current sales charge
applicable to a group may be obtained by contacting FTD.
A "qualified group" is one which (i) has been in existence
for more than six months, (ii) has a purpose other than acquiring
Fund Shares at a discount, and (iii) satisfies uniform criteria
which enable FTD to realize economies of scale in its costs of
distributing Shares. A qualified group must have more than 10
members, must be available to arrange for group meetings between
representatives of the Funds or FTD and the members, must agree
to include sales and other materials related to the Funds in its
publications and mailings to members at reduced or no cost to
FTD, and must seek to arrange for payroll deduction or other bulk
transmission of investments to the Funds.
If an investor selects a payroll deduction plan, subsequent
investments will be automatic and will continue until such time
as the investor notifies the Fund and the investor's employer to
discontinue further investments. Due to the varying procedures
to prepare, process and forward the payroll deduction information
to a Fund, there may be a delay between the time of the payroll
deduction and the time the money reaches a Fund. The investment
in a Fund will be made at the Offering Price per Share determined
<PAGE>
on the day that both the check and payroll deduction data are
received in required form by a Fund.
Class II. Unlike Class I Shares, the sales charges and
dealer concessions for Class II Shares do not vary depending on
the amount of sale. The total sales charges or underwriting
commissions and dealer concessions for Class II Shares are set
forth below.
Class II Shares - Total Sales Charge
As a As a
Percentage of Percentage of Portion of
Offering Price Net Asset Total Offering
Amount of Sale of the Shares Value of the Price retained
at Offering Price Purchased Shares Purchased by Dealers*
any amount . . . . . 1.00% 1.01% 1.00%
_______________
* FTD may pay the dealer, from its own resources, a commission
of 1% of the amount invested. During the first year
following purchase of Shares, FTD may retain a portion of
the Plan fees assessed on Class II Share to partially recoup
fees FTD pays to a securities dealer during the first year.
Net Asset Value Purchases (Both Classes). Shares of the
Funds may be purchased without the imposition of either an
initial sales charge ("net asset value") or a contingent deferred
sales charge by (i) officers, trustees, directors, and full-time
employees of the Funds, or any fund in the Franklin Templeton
Group, and their spouses and family members; (ii) companies
exchanging Shares with or selling assets pursuant to a merger,
acquisition or exchange offer; (iii) insurance company separate
accounts for pension plan contracts; (iv) accounts managed by the
<PAGE>
Investment Manager or its affiliates; (v) Shareholders of
Templeton Institutional Funds, Inc. reinvesting redemption
proceeds from that fund under an employee benefit plan qualified
under Section 401 of the Internal Revenue Code of 1986, as
amended (the "Code"), in Shares of the Funds; (vi) certain unit
investment trusts and unit holders of such trusts reinvesting
their distributions from the trusts in the Funds; (vii)
registered securities dealers and their affiliates, for their
investment account only; and (viii) registered personnel and
employees of securities dealers, and their spouses and family
members, in accordance with the internal policies and procedures
of the employing securities dealer.
Shares of the Funds may be purchased at net asset value and
without the imposition of a contingent deferred sales charge by
registered investment advisers and/or their affiliated broker-
dealers, who have entered into a supplemental agreement with FTD,
on behalf of their clients who are participating in a
comprehensive fee program (also known as a wrap fee program).
Shares of the Funds may be purchased at net asset value and
without the imposition of a contingent deferred sales charge by
certain designated retirement plans, including, profit sharing,
pension, 401(k) and simplified employee pension plans
("designated plans"), subject to minimum requirements with
respect to number of employees or amount of purchase, which may
be established by FTD. Currently, those criteria require that
the employer establishing the plan have 200 or more employees or
<PAGE>
that the amount invested or to be invested during the subsequent
13-month period in the Funds or in any of the Franklin Templeton
Investments totals at least $1 million. Employee benefit plans
not designated above or qualified under Section 401 of the Code
("non-designated plans") may be afforded the same privilege if
they meet the above requirements as well as the uniform criteria
for qualified groups previously described under "Group
Purchases," which enable FTD to realize economies of scale in its
sales efforts and sales related expenses. Please refer to the
SAI for further information.
Shares of the Funds may be purchased at net asset value and
without the imposition of a contingent deferred sales charge by
anyone who has taken a distribution from an existing retirement
plan already invested in any other fund(s) in the Franklin
Templeton Group (including former participants of the Franklin
Templeton Profit Sharing 401(k) plan). In order to exercise this
privilege, a written order for the purchase of Shares of the
Funds must be received by Franklin Templeton Trust Company, the
Funds, or Franklin Templeton Investor Services, Inc. (the
"Transfer Agent") within 120 days after the plan distribution.
To obtain a free Prospectus for any fund in the Franklin
Templeton Group, please call toll free at 1-800-DIAL BEN (1-800-
342-5236).
Shares of the Funds may be purchased at net asset value and
without the imposition of a contingent deferred sales charge by
trust companies and bank trust departments for funds over which
<PAGE>
they exercise exclusive discretionary investment authority and
which are held in a fiduciary, agency, advisory, custodial or
similar capacity. Such purchases are subject to minimum
requirements with respect to amount of purchase, which may be
established by FTD. Currently, those criteria require that the
amount invested or to be invested during the subsequent 13-month
period in the Funds or any of the Franklin Templeton Investments
must total at least $1 million. Orders for such accounts will be
accepted by mail accompanied by a check or 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 such order.
Shares of the Funds may be purchased at net asset value and
without the imposition of a contingent deferred sales charge by
investors who have, within the past 60 days, redeemed an
investment in an unaffiliated mutual fund which charged the
investor a contingent deferred sales charge upon redemption and
which has investment objectives similar to those of the Fund.
Shares of the Funds may also be purchased at net asset value
and without the imposition of a contingent deferred sales charge
by any state, county, or city, or any instrumentality,
department, authority or agency thereof which has determined that
the Funds are a legally permissible investment and which is
prohibited by applicable investment laws from paying a sales
charge or commission in connection with the purchase of Shares of
any registered management investment company ("an eligible
<PAGE>
governmental authority"). SUCH INVESTORS SHOULD CONSULT THEIR
OWN LEGAL ADVISORS TO DETERMINE WHETHER AND TO WHAT EXTENT THE
SHARES OF THE FUND CONSTITUTE LEGAL INVESTMENTS FOR THEM.
Municipal investors considering investment of proceeds of bond
offerings into the Funds should consult with expert counsel to
determine the effect, if any, of various payments made by the
Funds or its investment manager on arbitrage rebate calculations.
If an investment by an eligible governmental authority at net
asset value is made through a securities dealer who has executed
a dealer agreement with FTD, FTD or one of its affiliates may
make a payment, out of its own resources, to such securities
dealer in an amount not to exceed 0.25% of the amount invested.
Contact Franklin Templeton Institutional Services for additional
information.
Shares of the Funds may be purchased at net asset value and
without the imposition of a contingent deferred sales charge by
trustees or other fiduciaries purchasing securities for certain
retirement plans of organizations with collective retirement plan
assets of $10 million or more, without regard to where such
assets are currently invested.
Additional Dealer Compensation (Both Classes). A continuing
trail fee will be paid to qualifying dealers at the annual rate
of ____% of the average daily net asset value of Class I Shares,
and ____% of the average daily net asset value of Class II
Shares, registered in the name of that broker-dealer as nominee
or held in a Shareholder account that designates that broker-
<PAGE>
dealer as dealer of record. This fee is paid in order to promote
selling efforts and to compensate dealers for providing certain
services, including processing purchase and redemption
transactions, establishing Shareholder accounts and providing
certain information and assistance with respect to a Fund. For
purchases of Shares of either class that are subject to a
contingent deferred sales charge, the dealer will be paid the
trail fee beginning in the 13th month after the date of the
purchase.
FTD or its affiliates, at their expense, may also provide
additional compensation to dealers in connection with sales of
Shares of the Funds and other funds in the Franklin Group of
Funds and the Templeton Family of Funds (collectively, the
"Franklin Templeton Group"). Compensation may include financial
assistance to dealers in connection with conferences, sales or
training programs for their employees, seminars for the public,
advertising, sales campaigns and/or shareholder services and
programs regarding one or more funds in the Franklin Templeton
Group and other dealer-sponsored programs or events. In some
instances, this compensation may be made available only to
certain dealers whose representatives have sold or are expected
to sell significant amounts of such Shares. Compensation may
include payment for travel expenses, including lodging, incurred
in connection with trips taken by invited registered
representatives and members of their families to locations within
or outside of the U.S. for meetings or seminars of a business
nature. Dealers may not use sales of the Funds' Shares to
<PAGE>
qualify for this compensation to the extent such may be
prohibited by the laws of any state or any self-regulatory
agency, such as the National Association of Securities Dealers,
Inc. In addition, FTD or its affiliates may make ongoing
payments to brokerage firms, financial institutions (including
banks) and others to facilitate the administration and servicing
of shareholder accounts. None of the aforementioned additional
compensation is paid for by the Funds or their Shareholders.
Purchasing Class I and Class II Shares. When placing
purchase orders for Class I and Class II Shares of each Fund,
investors should clearly state whether Class I or Class II Shares
are intended to be purchased. All Share purchase orders that
fail to specify a class will automatically be invested in Class I
Shares. Initial purchases of more than $1 million must be for
Class I Shares. At the present time, there are no conversion
features attached to either class of shares.
Shareholders who qualify to invest in Class I Shares at net
asset value are prohibited from purchasing Class II Shares. See
"Net Asset Value Purchases."
As to telephone ordered placed with FTD by dealers, the
dealer must receive the investor's order before the close of the
New York Stock Exchange and transmit it to FTD by 5:00 p.m., New
York time, for the investor to receive that day's Offering Price.
Payment for such orders must be by check in U.S. currency and
must be promptly submitted to FTD. Orders mailed to FTD by
<PAGE>
dealers or individual investors are affected at the net asset
value of a Fund's Shares next computed after the purchase order
accompanied by payment has been received by FTD. Such payment
must be by check in U.S. currency drawn on a commercial bank in
the U.S. and,if over $100,000, may not be deemed to have been
received until the proceeds have been collected unless the check
is certified or issued by such bank. Any subscription may be
rejected by FTD or by the Funds.
The Funds may impose a $10 charge against a Shareholder
account in the event that a check or draft submitted for the
purchase of Fund Shares is returned unpaid to the Funds.
Investors should promptly check the confirmation advice that
is mailed after each purchase (or redemption) order to insure
that it has been accurately reflected in the investor's account.
Automatic Investment Plan. Investors may accumulate Fund
Shares regularly each month by means of automatic debits to their
checking accounts ($25 minimum). Forms for this purpose are in
the Shareholder Application in this Prospectus. Such a plan is
voluntary and may be discontinued by written notice to FTD, which
must be received at least 10 days prior to the collection date,
or by FTD upon written notice to the investor at least 30 days
prior to the collection date.
Institutional Accounts. There may be additional methods of
purchasing, redeeming or exchanging shares of the Funds available
<PAGE>
for institutional accounts. For further information, contact
Templeton's Institutional Account Services Department at
1-800-684-4001.
Account Statements. Shareholder accounts are opened in
accordance with the Shareholder's registration instructions.
Transactions in the account, such as additional investments and
dividend reinvestments, will be reflected on regular confirmation
statements from Franklin Templeton Investor Services, Inc. (the
"Transfer Agent").
Templeton STAR Service. Shareholders may check the current
prices of Shares, account balances/values, a description of the
last transaction and duplicate account statements, 24 hours a
day, 365 days a year, with Templeton STAR Service by calling 1-
800-654-0123 from a touch-tone telephone. A fund code and the
Shareholder's account number are necessary for accessing
information (other than Share prices) from Templeton STAR
Service. The Funds' codes are as follows: Greater European Fund,
_______; Latin America Fund, _____.
Retirement Plans. Shares of the Funds may be purchased
through various retirement plans including the following plans
for which Franklin Templeton Trust Company or its affiliate acts
as trustee or custodian: IRAs, Simplified Employee Pensions,
403(b) plans, qualified plans for corporations, self-employed
individuals and partnerships, and 401(k) plans. For further
information about any of the plans, agreements, applications and
<PAGE>
annual fees, contact Franklin Templeton Distributors, Inc. To
determine which retirement plan is appropriate, an investor
should contact his or her tax adviser.
Net Asset Value. The net asset value of the Shares of each
Fund is computed as of the close of trading on each day the New
York Stock Exchange is open for trading, by dividing the value of
a Fund's securities plus any cash and other assets (including
accrued interest and dividends receivable) less all liabilities
(including accrued expenses) by the number of Shares outstanding,
adjusted to the nearest whole cent. A security listed or traded
on a recognized stock exchange or NASDAQ is valued at its last
sale price on the principal exchange on which the security is
traded. The value of a foreign security is determined in its
national currency as of the close of trading on the foreign
exchange on which it is traded, or as of the close of trading on
the New York Stock Exchange, if that is earlier, and that value
is then converted into its U.S. dollar equivalent at the foreign
exchange rate in effect at noon, New York time, on the day the
value of the foreign security is determined. If no sale is
reported at that time, the mean between the current bid and asked
price is used. Occasionally, events which affect the values of
such securities and such exchange rates may occur between the
times at which they are determined and the close of the New York
Stock Exchange, and will therefore not be reflected in the
computation of a Fund's net asset value. If events materially
affecting the value of such securities occur during such period,
then these securities will be valued at fair value as determined
<PAGE>
by the management and approved in good faith by the Board of
Trustees. All other securities for which over-the-counter market
quotations are readily available are valued at the mean between
the current bid and asked price. Securities for which market
quotations are not readily available and other assets are valued
at fair value as determined by the management and approved in
good faith by the Board of Trustees.
EXCHANGE PRIVILEGE
A Shareholder may exchange Shares for the same class of
shares of other funds in the Franklin Templeton Group (except
Templeton American Trust, Inc., Templeton Capital Accumulator
Fund, Inc., Templeton Variable Annuity Fund, Templeton Variable
Products Series Fund, Franklin Valuemark Funds and Franklin
Government Securities Trust). A contingent deferred sales charge
will not be imposed on exchanges. If the exchanged Shares were
subject to a contingent deferred sales charge in the original
fund purchased, and Shares are subsequently redeemed within 12
months (Class I Shares) or 18 months (Class II Shares) of the
calendar month of the original purchase date, a contingent
deferred sales charge will be imposed. The period will be tolled
(or stopped) for the period Class I Shares are exchanged into and
held in a Franklin or Templeton money market fund. See also "How
to Sell Shares of the Funds - Contingent Deferred Sales Charge."
Exchange purchases are subject to the minimum investment
requirements of the fund purchased and no sales charge generally
<PAGE>
applies. However, exchanges of shares from the Franklin
Templeton Money Funds are subject to applicable sales charges on
the funds being purchased, unless the Franklin Templeton Money
Fund shares were acquired by an exchange from a fund having a
sales charge, or by reinvestment of dividends or capital gains
distributions. Exchanges of Class I Shares of the Funds which
were purchased with a lower sales charge to a fund which has a
higher sales charge will be charged the difference, unless the
shares were held in the original fund for at least six months
prior to executing the exchange. All exchanges are permitted
only after at least 15 days have elapsed from the date of the
purchase of the Shares to be exchanged.
A Shareholder may exchange Shares by writing to the Transfer
Agent (see "How to Sell Shares of the Funds"), by contacting his
or her investment dealer or - if the Shareholder Application
indicates that the Shareholder has not declined the option - by
telephoning 1-800-354-9191. Telephone exchange instructions must
be received by FTD by 4:00 p.m., New York time. Telephonic
exchanges can involve only Shares in non-certificated form.
Shares held in certificate form are not eligible, but may be
returned and qualify for these services. All accounts involved
in a telephonic exchange must have the same registration and
dividend option as the account from which the Shares are being
exchanged. The Trust and the Transfer Agent will employ
reasonable procedures to confirm that instructions communicated
by telephone are genuine. Please refer to "Telephone
Transactions -- Verification Procedures." Forms for declining
<PAGE>
the telephone exchange privilege and prospectuses of the other
funds in the Franklin Templeton Group may be obtained from FTD.
Exchange redemptions and purchases are processed simultaneously
at the Share prices next determined after the exchange order is
received. (See "How to Buy Shares of the Funds -- Offering
Price.") A gain or loss for tax purposes generally will be
realized upon the exchange, depending on the tax basis of the
Shares redeemed.
This exchange privilege is available only in states where
shares of the fund being acquired may legally be sold and may be
modified, limited or terminated at any time by the Trust upon 60
days' written notice. A Shareholder who wishes to make an
exchange should first obtain and review a current prospectus of
the fund into which he or she wishes to exchange. Broker-
dealers who process exchange orders on behalf of their customers
may charge a fee for their services. Such fee may be avoided by
making requests for exchange directly to the Transfer Agent.
The equivalent of an exchange involving retirement accounts
(including IRAs) between the Templeton Family of Funds and the
Franklin Group of Funds requires the completion of additional
documentation before it can be effected. Call 1-800-354-9191 for
further information and forms.
Exchanges of Class II Shares. When an account has some
Shares subject to the contingent deferred sales charge, and some
that are not, the Shares will be transferred proportionately from
<PAGE>
each type of Shares into the new fund. Shares received from
reinvestment of dividends and capital gain distributions are
referred to as "free Shares," Shares which were originally
subject to a contingent deferred sales charge but to which the
contingent deferred sales charge no longer applies are called
"matured Shares," and Shares still subject to the contingent
deferred sales charge are referred to as "CDSC liable Shares,"
and each represents a different type of Shares for purposes of
exchanging into a new fund. CDSC liable Shares held for
different periods of time are considered different types of CDSC
liable Shares. For instance, if a Shareholder has $1,000 in free
Shares, $2,000 in matured Shares, and $3,000 in CDSC liable
Shares, and the Shareholder exchanges $3,000 into a new fund,
$500 will be exchanged from free Shares, $1,000 from matured
Shares, and $1,500 from CDSC liable Shares. Similarly, if CDSC
liable Shares have been purchased at different periods, a
proportionate amount will be taken from Shares held for each
period. If, for example, the Shareholder holds $1,000 in Shares
bought 3 months ago, $1,000 bought 6 months ago, and $1,000
bought 9 months ago, $500 in each of these Shares will be
exchanged into the new fund.
Class II Shares may be exchanged for shares of Franklin
Templeton Money Fund II ("Money Fund II"), a series of the
Franklin Templeton Money Fund Trust. No drafts (checks) may be
written on Money Fund II accounts, nor may Shareholders purchase
shares in Money Fund II directly. Shares continue to age and a
contingent deferred sales charge will be assessed if CDSC liable
<PAGE>
shares are redeemed. No other money market funds are available
for Class II Shareholders for exchange purposes. On the other
hand, Class I Shares may be exchanged for shares of any money
market funds in the Franklin Group of Funds or the Templeton
Family of Funds market funds except Money Fund II. Draft writing
privileges and direct purchases are allowed on these money market
funds as described in their respective prospectuses.
Transfers. Transfers between accounts in the same fund and
class are not subject to a contingent deferred sales charge. The
transferred Shares will continue to age from the date of original
purchase. Like exchanges, Shares will be moved proportionately
from each type of Shares in the original account.
Conversion Rights. It is not presently anticipated that
Class II Shares will be converted to Class I Shares at this time.
A Shareholder may, however, sell Class II Shares and use the
proceeds to purchase Class I Shares. In that event, the sales
charge for the purchased Class I Shares will be decreased by the
value of any initial sales charge and contingent deferred sales
charge paid in connection with the purchase and redemption of the
Class II Shares.
Exchanges by Timing Accounts. In the case of market timing
or allocation services ("Timing Accounts"), FTD will deduct an
administrative service fee of $5.00 per exchange. Timing
Accounts generally include accounts administered so as to redeem
or purchase Shares based upon certain predetermined market
<PAGE>
indicators. In accordance with the terms of their respective
prospectuses, certain funds in the Franklin Templeton Group do
not accept or may place differing limitations than those
described below on exchanges by Timing Accounts.
The Trust reserves the right to temporarily or permanently
terminate the exchange privilege or reject any specific purchase
order for any Timing Account or any person whose transactions
seem to follow a timing pattern who: (i) makes an exchange
request out of a Fund within two weeks of an earlier exchange
request out of a Fund; (ii) makes more than two exchanges out of
a Fund per calendar quarter; or (iii) exchanges shares equal in
value to at least $5 million, or more than 1% of a Fund's net
assets. Accounts under common ownership or control, including
accounts administered so as to redeem or purchase shares based
upon certain predetermined market indicators, will be aggregated
for purposes of the exchange limits.
In addition, the Trust reserves the right to refuse the
purchase side of exchange requests by any Timing Account, person,
or group if, in the Investment Manager's judgment, a Fund would
be unable to invest effectively in accordance with its investment
objectives and policies, or would otherwise potentially be
adversely affected. A Shareholder's exchanges into a Fund may be
restricted or refused if a Fund receives or anticipates
simultaneous orders affecting significant portions of a Fund's
assets. In particular, a pattern of exchanges that coincides
<PAGE>
with a "market timing" strategy may be disruptive to a Fund and
therefore may be refused.
Finally, as indicated above, the Trust and FTD reserve the
right to refuse any order for the purchase of Shares.
HOW TO SELL SHARES OF THE FUNDS
Contingent Deferred Sales Charge
Class I. In order to recover commissions paid to securities
dealers on qualified investments of $1 million or more, a
contingent deferred sales charge of 1% applies to redemptions of
those investments within 12 months of the calendar month of their
purchase. The charge is 1% of the lesser of the value of the
Shares redeemed (exclusive of reinvested dividends and capital
gain distributions) or the total cost of such Shares, and is
retained by FTD.
Class II. Class II Shares redeemed within eighteen months
of their purchase will be assessed a contingent deferred sales
charge of 1% on the lesser of the then-current net asset value or
the original purchase price of such Shares unless one of the
exceptions described below applies. A contingent deferred sales
charge will not be assessed on increases in net asset value above
the initial purchase price, Class II Shares held more than 18
months, or on Shares originally derived from reinvestment of
dividends or capital gains distributions. For tax purposes, a
<PAGE>
contingent deferred sales charge is treated as a reduction in
redemption proceeds, rather than an adjustment to the cost basis.
Class I and Class II. In determining if a charge applies,
Shares not subject to a contingent deferred sales charge are
deemed to be redeemed first, in the following order: (i) Shares
representing amounts attributable to capital appreciation of
those Shares held less than the contingency period; (ii) Shares
purchased with reinvested dividends and capital gains
distributions; and (iii) other Shares held longer than the
contingency period, followed by any Shares held less than the
contingency period, on a "first in, first out" basis.
The contingent deferred sales charge is waived for:
exchanges; distributions to participants in Franklin Templeton
Trust Company or Templeton Funds Trust Company retirement plan
accounts due to death, disability or attainment of age 59 1/2;
tax-free returns of excess contributions to employee benefit
plans; distributions from employee benefit plans, including those
due to plan termination or plan transfer; redemptions through a
Systematic Withdrawal Plan established prior to February 1, 1995
and, for Systematic Withdrawal Plans established thereafter,
redemptions of up to 1% monthly of an account's net asst value
(3% quarterly, 6% semiannually or 12% annually); and redemptions
initiated by the Funds due to a Shareholder's account falling
below the minimum specified account size.
<PAGE>
All investments made during a calendar month, regardless of
when during the month the investment occurred, will age one month
on the last day of that month, and each subsequent month.
Requests for redemptions for a specified dollar amount will
result in additional Shares being redeemed to cover any
applicable contingent deferred sales charge while requests for
redemption of a specific number of Shares will result in the
applicable contingent deferred sales charge being deducted from
the total dollar amount redeemed.
Shares will be redeemed on request of the Shareholder in
"Proper Order" to the Transfer Agent. "Proper Order" means that
the request to redeem must meet all of the following
requirements:
1. Except as provided below under "Redemptions by
Telephone," it must be in writing, signed by the Shareholder(s)
exactly in the manner as the Shares are registered, and must
specify either the number of Shares, or the dollar amount of
Shares, to be redeemed and sent to Franklin Templeton Investor
Services, Inc., P.O. Box 33030, St. Petersburg, Florida 33733-
8030;
2. The signature(s) of the redeeming Shareholder(s) must
be guaranteed by an "eligible guarantor," including (1) national
or state banks, savings associations, savings and loan
associations, trust companies, savings banks, industrial loan
<PAGE>
companies and credit unions; (2) national securities exchanges,
registered securities associations and clearing agencies; (3)
securities broker-dealers which are members of a national
securities exchange or a clearing agency or which have minimum
net capital of $100,000; or (4) institutions that participate in
the Securities Transfer Agent Medallion Program ("STAMP") or
other recognized signature medallion program. A notarized
signature will not be sufficient for the request to be in Proper
Order. If the Shares are registered in more than one name, the
signature of each of the redeeming Shareholders must be
guaranteed. A signature guarantee is not required for
redemptions of $50,000 or less, requested by and payable to all
Shareholders of record, to be sent to the address of record for
that account. However, the Trust reserves the right to require
signature guarantees on all redemptions. A signature guarantee
is required in connection with any written request for transfer
of Shares. Also, a signature guarantee is required if the Trust
or the Transfer Agent believes that a signature guarantee would
protect against potential claims based on the transfer
instructions, including, for example, when (a) the current
address of one or more joint owners of an account cannot be
confirmed, (b) multiple owners have a dispute or give
inconsistent instructions to the Trust, (c) the Trust has been
notified of an adverse claim, (d) the instructions received by
the Trust are given by an agent, not the actual registered owner,
(e) the Trust determines that joint owners who are married to
each other are separated or may be the subject of divorce
proceedings, or (f) the authority of a representative of a
<PAGE>
corporation, partnership, association, or other entity has not
been established to the satisfaction of the Trust;
3. Any outstanding certificates must accompany the request
together with a stock power signed by the Shareholder(s), with
signature(s) guaranteed as described in Item 2 above;
4. Liquidation requests of corporate, partnership, trust
and custodianship accounts, and accounts under court
jurisdiction, require the following documentation to be in proper
form:
Corporation - (i) Signature guaranteed letter of
instruction from the authorized officer(s) of the
corporation, and (ii) a corporate resolution in a form
satisfactory to the Transfer Agent
Partnership - (i) Signature guaranteed letter of
instruction from a general partner and, if necessary,
(ii) pertinent pages from the partnership agreement
identifying the general partners or other documentation
in a form satisfactory to the Transfer Agent;
Trust - (i) Signature guaranteed letter of instruction
from the trustee(s), and (ii) a copy of the pertinent
pages of the trust document listing the trustee(s) or a
certificate of incumbency if the trustee(s) are not
listed on the account registration;
Custodial (other than a retirement account) - Signature
guaranteed letter of instruction from the custodian;
<PAGE>
Accounts under court jurisdiction - Check court
documents and the applicable state law since these
accounts have varying requirements, depending upon the
state of residence; and
5. Redemption of Shares held in a retirement plan for
which Franklin Templeton Trust Company or its affiliate acts as
trustee or custodian must conform to the distribution
requirements of the plan and the Funds' redemption requirements
above. Distributions from such plans are subject to additional
requirements under the Code, and certain documents (available
from the Transfer Agent) must be completed before the
distribution may be made. For example, distributions from
retirement plans are subject to withholding requirements under
the Code, and the IRS Form W-4P (available from the Transfer
Agent) may be required to be submitted to the Transfer Agent with
the distribution request, or the distribution will be delayed.
The Transfer Agent and its affiliates assume no responsibility to
determine whether a distribution satisfies the conditions of
applicable tax laws and will not be responsible for any penalties
assessed.
To avoid delay in redemption or transfer, Shareholders
having questions about these requirements should contact the
Account Services Department by calling 1-800-354-9191 or
813-823-8712.
<PAGE>
The redemption price will be the net asset value of the
Shares next computed after the redemption request in Proper Order
is received by the Transfer Agent. Payment of the redemption
price ordinarily will be made by check (or by wire at the sole
discretion of the Transfer Agent if wire transfer is requested,
including name and address of the bank and the Shareholder's
account number to which payment of the redemption proceeds is to
be wired) within seven days after receipt of the redemption
request in Proper Order. However, if Shares have been purchased
by check, the Trust will make redemption proceeds available when
a Shareholder's check received for the Shares purchased has been
cleared for payment by the Shareholder's bank, which, depending
upon the location of the Shareholder's bank, could take up to
fifteen days or more. The check will be mailed by first-class
mail to the Shareholder's registered address (or as otherwise
directed). Remittance by wire (to a commercial bank account in
the same name(s) as the Shares are registered) or express mail,
if requested, are subject to a handling charge of $15, which will
be deducted from the redemption proceeds.
The Funds, through FTD, also repurchases Shares (whether in
certificate or book-entry form) through securities dealers. The
Funds normally will accept orders to repurchase such Shares by
wire or telephone from dealers for their customers at the net
asset value next computed after the dealer has received the
certificate holder's request for repurchase, if the dealer
received such request before closing time of the New York Stock
Exchange on that day. Dealers have the responsibility of
<PAGE>
submitting such repurchase requests by calling not later than
5:00 p.m., New York time, on such day in order to obtain that
day's applicable redemption price. Repurchase of Shares is for
the convenience of Shareholders and does not involve a charge by
the Funds; however, securities dealers may impose a charge on the
Shareholder for transmitting the notice of repurchase to the
Funds. Each Fund reserves the right to reject any order for
repurchase, which right of rejection might adversely affect
Shareholders seeking redemption through the repurchase procedure.
Ordinarily, payment will be made to the securities dealer within
seven days after receipt of a repurchase order and Share
certificate (if any) in "Proper Order" as set forth above. Each
Fund also will accept, from member firms of the New York Stock
Exchange, orders to repurchase Shares for which no certificates
have been issued by wire or telephone without a redemption
request signed by the Shareholder, provided the member firm
indemnifies the Fund and FTD from any liability resulting from
the absence of the Shareholder's signature. Forms for such
indemnity agreement can be obtained from FTD.
The Funds may involuntarily redeem an investor's Shares if
the net asset value of such Shares is less than $100, provided
that involuntary redemptions will not result from fluctuations in
the value of an investor's Shares. In addition, the Funds may
involuntarily redeem the Shares of any investor who has failed to
provide a Fund with a certified taxpayer identification number or
such other tax-related certifications as a Fund may require. A
notice of redemption, sent by first-class mail to the investor's
<PAGE>
address of record, will fix a date not less than 30 days after
the mailing date, and Shares will be redeemed at net asset value
at the close of business on that date, unless sufficient
additional Shares are purchased to bring the aggregate account
value up to $100 or more, or unless a certified taxpayer
identification number (or such other information as the Fund has
requested) has been provided, as the case may be. A check for
the redemption proceeds will be mailed to the investor at the
address of record.
Reinstatement Privilege. Shares of the Funds may be
purchased at net asset value with the proceeds from (i) a
redemption of Shares of any fund in the Franklin Templeton Group
(except Templeton American Trust, Inc., Templeton Capital
Accumulator Fund, Inc., Templeton Variable Annuity Fund,
Templeton Variable Products Series Fund, Franklin Valuemark Funds
and Franklin Government Securities Trust) which were purchased
with an initial sales charge or assessed a contingent deferred
sales charge on redemption, or (ii) a dividend or distribution
paid by any fund in the Franklin Templeton Group, within 120 days
after the date of the redemption or dividend or distribution.
However, if a Shareholder's original investment was in Class I
shares of a fund with a lower sales charge, or no sales charge,
the Shareholder must pay the difference. While credit will be
given for any contingent deferred sales charge paid on the Shares
redeemed, a new contingency period will begin. Shares of the
Funds redeemed in connection with an exchange into another fund
(see "Exchange Privilege") are not considered "redeemed" for this
<PAGE>
privilege. In order to exercise this privilege, a written order
for the purchase of Shares of the Funds must be received by the
Funds or the Funds' Transfer Agent within 120 days after the
redemption. The 120 days, however, do not begin to run on
redemption proceeds placed immediately after redemption in a
Franklin Bank Certificate of Deposit ("CD") until the CD
(including any rollover) matures. The amount of gain or loss
resulting from a redemption may be affected by exercise of the
reinstatement privilege if the Shares redeemed were held for 90
days or less, or if a Shareholder reinvests in the same fund
within 30 days. Reinvestment will be at the next calculated net
asset value after receipt.
Systematic Withdrawal Plan. A Shareholder may establish a
Systematic Withdrawal Plan ("Plan") and receive periodic payments
from the account provided that the net asset value of the Shares
held by the Shareholder is at least $5,000. There are no service
charges for establishing or maintaining a Plan. The minimum
amount which the Shareholder may withdraw is $50 per withdrawal
transaction although this is merely the minimum amount allowed
under the Plan and should not be mistaken for a recommended
amount. The Plan may be established on a monthly, quarterly,
semi-annual or annual basis. If the Shareholder establishes a
Plan, any capital gain distributions and income dividends paid by
a Fund to the Shareholder's account must be reinvested for the
Shareholder's account in additional Shares at net asset value.
Payments are then made from the liquidation of Shares at net
asset value on the day of the liquidation (which is generally on
<PAGE>
or about the 25th of the month) to meet the specified
withdrawals. Payments are generally received three to five days
after the date of liquidation. By completing the "Special
Payment Instructions for Distributions" section of the
Shareholder Application included with this Prospectus, a
Shareholder may direct the selected withdrawals to another fund
in the Franklin Templeton Group, to another person, or directly
to a checking account. Liquidation of Shares may reduce or
possibly exhaust the Shares in the Shareholder's account, to the
extent withdrawals exceed Shares earned through dividends and
distributions, particularly in the event of a market decline. If
the withdrawal amount exceeds the total Plan balance, the account
will be closed and the remaining balance will be sent to the
Shareholders. As with other redemptions, a liquidation to make a
withdrawal payment is a sale for Federal income tax purposes.
Because the amount withdrawn under the Plan may be more than the
Shareholder's actual yield or income, part of such a Plan payment
may be a return of the Shareholder's investment.
Maintaining a Plan concurrently with purchases of additional
Shares of a Fund would be disadvantageous because of the sales
charge on the additional purchases. The Shareholder should
ordinarily not make additional investments of less than $5,000 or
three times the annual withdrawals under the Plan during the time
such a Plan is in effect. A Plan may be terminated on written
notice by the Shareholder or a Fund, and it will terminate
automatically if all Shares are liquidated or withdrawn from the
account, or upon a Fund's receipt of notification of the death or
<PAGE>
incapacity of the Shareholder. Shareholders may change the
amount (but not below $50) and schedule of withdrawal payments or
suspend one such payment by giving written notice to the Transfer
Agent at least seven business days prior to the end of the month
preceding a schedules payment. Share certificates may not be
issued while a Plan is in effect.
Redemptions by Telephone. Shareholders who file a Telephone
Redemption Authorization Agreement (the "Agreement") (a copy of
which is included in this Prospectus) may redeem Shares of the
Funds by telephone, subject to the Restricted Account exception
noted under "Telephone Transactions -- Restricted Accounts." The
Trust and the Transfer Agent will employ reasonable procedures to
confirm that instructions given by telephone are genuine.
Shareholders, however, bear the risk of loss in certain cases as
described under "Telephone Transactions -- Verification
Procedures."
For Shareholder accounts with a completed Agreement on file,
redemptions of uncertificated Shares or Shares which have
previously been deposited with the Funds or the Transfer Agent
may be made for up to $50,000 per day per Fund account.
Telephone redemption requests received before 4:00 p.m., New York
time, on any business day will be processed that same day. The
redemption check will be sent within seven days, made payable to
all the registered owners on the account, and will be sent only
to the address of record. Redemption requests by telephone will
not be accepted within 30 days following an address change by
<PAGE>
telephone. In that case, a Shareholder should follow the other
redemption procedures set forth in this Prospectus.
Institutional accounts which wish to execute redemptions in
excess of $50,000 must complete an Institutional Telephone
Privileges Agreement which is available from Templeton's
Institutional Account Services Department by telephoning
1-800-684-4001.
TELEPHONE TRANSACTIONS
Shareholders of the Funds and their dealer of record, if
any, may be able to execute various transactions by calling the
Transfer Agent at 1-800-354-9191. All Shareholders will be able
to: (i) effect a change in address, (ii) change a dividend
option (see "Restricted Accounts" below), (iii) transfer Fund
Shares in one account to another identically registered account
in the Fund, and (iv) exchange Fund Shares by telephone as
described in this Prospectus. In addition, Shareholders who
complete and file an Agreement as described under "How to Sell
Shares of the Fund -- Redemptions by Telephone" will be able to
redeem Shares of the Funds.
Verification Procedures. The Trust and the Transfer Agent
will employ reasonable procedures to confirm that instructions
communicated by telephone are genuine. These will include:
recording all telephone calls requesting account activity by
telephone, requiring that the caller provide certain personal
and/or account information requested by the telephone service
<PAGE>
agent at the time of the call for the purpose of establishing the
caller's identification, and sending a confirmation statement on
redemptions to the address of record each time account activity
is initiated by telephone. So long as the Trust and the Transfer
Agent follow instructions communicated by telephone which were
reasonably believed to be genuine at the time of their receipt,
neither they nor their affiliates will be liable for any loss to
the Shareholder caused by an unauthorized transaction.
Shareholders are, of course, under no obligation to apply for or
accept telephone transaction privileges. In any instance where
the Trust or the Transfer Agent is not reasonably satisfied that
instructions received by telephone are genuine, the requested
transaction will not be executed, and neither the Trust, the
Transfer Agent, nor their affiliates will be liable for any
losses which may occur because of a delay in implementing a
transaction.
Restricted Accounts. Telephone redemptions and dividend
option changes may not be accepted on Franklin Templeton Trust
Company ("FTTC") or Templeton Funds Trust Company ("TFTC")
retirement accounts. To assure compliance with all applicable
regulations, special forms are required for any distribution,
redemption, or dividend payment. Although the telephone exchange
privilege is extended to these retirement accounts, a Franklin
Templeton Transfer Authorization Form must be on file in order to
transfer retirement plan assets between the Franklin Group of
Funds and the Templeton Family of Funds within the same plan
<PAGE>
type. Changes to dividend options for these accounts must also
be made in writing.
To obtain further information regarding distribution or
transfer procedures, including any required forms, FTTC
retirement account shareholders may call 1-800-527-2020 (toll
free), and TFTC retirement account shareholders may call
1-800-354-9191 (press "2") (also toll free).
General. During periods of drastic economic or market
changes, it is possible that the telephone transaction privileges
will be difficult to execute because of heavy telephone volume.
In such situations, Shareholders may wish to contact their
registered dealer for assistance, or to send written instructions
to the Trust as detailed elsewhere in this Prospectus.
Neither the Trust nor the Transfer Agent will be liable for
any losses resulting from the inability of a Shareholder to
execute a telephone transaction. The telephone transaction
privilege may be modified or discontinued by the Trust at any
time upon 60 days' written notice to Shareholders.
MANAGEMENT OF THE FUND
The Trust is managed by its Board of Trustees and all powers
of the Trust are exercised by or under authority of the Board.
Information relating to the Trustees and executive officers is
set forth under the heading "Management of the Trust" in the SAI.
<PAGE>
The Board has carefully reviewed the multiclass structure to
ensure that no material conflict exists between the two classes
of Shares. Although the Board does not expect to encounter
material conflicts in the future, the Board will continue to
monitor the Trust and will take appropriate action to resolve
such conflicts if any should later arise.
Investment Manager. The Investment Manager of the Funds is
Templeton, Galbraith & Hansberger Ltd., Nassau, Bahamas. The
Investment Manager is an indirect wholly owned subsidiary of
Franklin Resources, Inc. ("Franklin"). Through its subsidiaries,
Franklin is engaged in various aspects of the financial services
industry.
The Investment Manager furnishes the Funds with investment
research, advice and supervision and has responsibility for
management of each Fund's portfolio. The Investment Manager does
not furnish any overhead items or facilities for the Funds,
although such expenses are paid by some investment advisers of
other investment companies. As compensation for its services,
the Funds each pay the Investment Manager a monthly fee, equal on
an annual basis to 0.60% of its average daily net assets during
the year. Each Fund also pays its own operating expenses,
including: (1) its pro rata portion of the fees and expenses of
the Company's disinterested Trustees; (2) interest expenses; (3)
taxes and governmental fees; (4) brokerage commissions and other
expenses incurred in acquiring or disposing of portfolio
<PAGE>
securities; (5) the expenses of registering and qualifying its
Shares for sale with the Securities and Exchange Commission
("SEC") and with various state securities commissions; (6)
expenses of its independent public accountants and legal counsel;
(7) insurance premiums; (8) fees and expenses of the Custodian
and Transfer Agent and any related services; (9) expenses of
obtaining quotations of portfolio securities and of pricing
Shares; (10) its pro rata portion of the expenses of maintaining
the Trust's legal existence and of Shareholders' meetings; (11)
expenses of preparation and distribution to existing Shareholders
of periodic reports, proxy materials and prospectuses; (12)
payments made pursuant to the Fund's Distribution Plan (see "Plan
of Distribution"); and (13) fees and expenses of membership in
industry organizations.
The Investment Manager and its affiliates serve as advisers
for a wide variety of public investment mutual funds and private
clients in many nations. The Investment Manager and its
predecessors have been investing globally over the past 52 years
and provide investment management and advisory services to a
worldwide client base, including over 3.0 million mutual fund
shareholders, foundations and endowments, employee benefit plans
and individuals. The Investment Manager and its affiliates have
approximately 3,200 employees in ten different countries and a
global network of over 50 investment research sources. Many
different selection methods are used for different funds and
clients, and many are changed and improved by the Investment
Manager's research on superior selection methods.
<PAGE>
The lead portfolio manager for Greater European Fund is
Dorian B. Foyil, Vice President of the Investment Manager and
head of Templeton's Research Technology Group. Prior to joining
the Templeton organization, Mr. Foyil was a research analyst for
four years with UBS Phillips & Drew in London, England.
The lead portfolio manager for Latin America Fund is Dr.
Jane Siebels-Kilnes, [position with TGH]. Prior to joining the
Templeton organization in 1990, Dr. Siebels-Kilnes worked for
Union Bank of Switzerland, Zurich, as the head of equity
management for European institutional accounts. She also worked
as an international portfolio manager for Storebrand
International, a Norwegian insurance company, and as director and
portfolio manager of the Storebrand International Unit Trust.
She is also a former director of the Genesis Emerging Markets and
the Genesis Chile Funds.
Further information concerning the Investment Managers is
included under the heading "Investment Management and Other
Services" in the SAI.
Business Manager. Templeton Global Investors, Inc. provides
certain administrative facilities and services for the Funds,
including payment of salaries of officers, preparation and
maintenance of books and records, preparation of tax returns and
financial reports, monitoring compliance with regulatory
requirements and monitoring tax deferred retirement plans. For
<PAGE>
its services, each Fund pays the Business Manager a monthly fee
equivalent on an annual basis to 0.15% of the combined average
daily net assets of the Funds included in the Trust (the Funds,
Templeton Americas Government Securities Fund, Templeton Global
Rising Dividends Fund and Templeton Global Infrastructure Fund),
reduced to 0.135% of such combined assets in excess of $200
million, to 0.10% of such assets in excess of $700 million, and
to 0.075% of such assets in excess of $1,200 million.
Transfer Agent. Franklin Templeton Investor Services, Inc.
serves as transfer agent and dividend disbursing agent for the
Funds.
Custodian. The Chase Manhattan Bank, N.A. serves as
custodian of the Funds' assets.
Plans of Distribution. Each class of Shares of each Fund
has approved and adopted a separate Plan of Distribution ("Class
I Plans" and "Class II Plans," respectively, or "Plans") pursuant
to Rule 12b-1 under the 1940 Act. The Rule 12b-1 fees charged to
each class will be based solely on the distribution and servicing
fees attributable to that particular class. Any portion of fees
remaining from any Plan after distribution to securities dealers
up to the maximum amount permitted under each Plan may be used by
the class to reimburse FTD for routine ongoing promotion and
distribution expenses. Such expenses may include, but are not
limited to, the printing of prospectuses and reports used for
sales purposes, expenses, of preparing and distributing sales
<PAGE>
literature and related expenses, advertisements, and other
distribution-related expenses, including a prorated portion of
FTD's overhead expenses attributable to the distribution of Fund
Shares, as well as any distribution or service fees paid to
securities dealers or their firms or others who have executed a
servicing agreement with the Funds, FTD or its affiliates.
The maximum amount which a Fund may pay to FTD or others
under the Class I Plans for such distribution expenses is 0.35%
per annum of Class I's average daily net assets, payable on a
quarterly basis. All expenses of distribution and marketing in
excess of 0.35% per annum will be borne by FTD, or others who
have incurred them, without reimbursement from the Funds.
Under the Class II Plans, the maximum amount which a Fund
may pay to Distributors or others for such distribution expenses
is 0.75% of Class II's average daily net assets per annum,
payable monthly, in order to compensate FTD or others for
providing distribution and related services and bearing certain
expenses of the Class. All expenses of distribution and
marketing over that amount will be borne by FTD, or others who
have incurred them without reimbursement by the Funds. In
addition to this amount, under the Class II Plans, a Fund shall
pay 0.25% per annum of the Class' average daily net assets as a
servicing fee. This fee will be used to pay dealers or others
for, among other things, assisting in establishing and
maintaining customer accounts and records; assisting with
purchase and redemption requests; receiving and answering
<PAGE>
correspondence; monitoring dividend payments from the Funds on
behalf of the customers; and similar activities related to
furnishing personal services and maintaining Shareholder
accounts.
During the first year after the purchase of the Shares, FTD
will keep a portion of the Plan fees assessed on Class II Shares
to partially recoup fees FTD pays to a securities dealer.
Each Plan also covers any payments to or by the Funds, the
Investment Manager, FTD, or other parties on behalf of the Funds,
the Investment Manager or FTD, to the extent such payments are
deemed to be for the financing of any activity primarily intended
to result in the sale of Shares issued by the Funds within the
context of Rule 12b-1. The payments under the Plans are included
in the maximum operating expenses which may be borne each class
of the Funds. For more information, please see the SAI.
Brokerage Commissions. The Trust's brokerage policies are
described under the heading "Brokerage Allocation" in the SAI.
The Trust's brokerage policies provide that the receipt of
research services from a broker and the sale of Shares by a
broker are factors which may be taken into account in allocating
securities transactions, so long as the prices and execution
provided by the broker equal the best available within the scope
of the Trust's brokerage policies.
<PAGE>
GENERAL INFORMATION
Description of Shares/Share Certificates. The
capitalization of the Trust consists of an unlimited number of
Shares of beneficial interest, par value $0.01 per Share. The
Board of Trustees is authorized, in its discretion, to classify
and allocate the unissued Shares of the Trust in an unlimited
number of separate series and may in the future divide existing
series into two or more classes. Each Share entitles the holder
to one vote.
The Funds will not ordinarily issue certificates for Shares
purchased. Share certificates representing the whole (not frac-
tional) Shares are issued only upon the specific request of the
Shareholder made in writing to the Transfer Agent. No charge is
made for the issuance of one certificate for all or some of the
Shares purchased in a single order.
Meetings of Shareholders. The Trust is not required to hold
annual meetings of Shareholders and may elect not to do so. The
Trust will call a special meeting of Shareholders for the purpose
of considering the removal of a person serving as Trustee if
requested in writing to do so by the holders of not less than 10%
of the Trust's outstanding Shares. The Trust is required to
assist Shareholder communications in connection with the calling
of Shareholder meetings to consider removal of a Trustee or
Trustees.
<PAGE>
Dividends and Distributions. Each Fund intends normally to
pay a monthly dividend representing substantially all of its net
investment income and to distribute at least annually any net
realized capital gains. Dividends will be calculated and
distributed in the same manner for both classes of Shares, and
their value will differ only to the extent that they are affected
by the distribution plan fees and sales charges. Because ongoing
Rule 12b-1 expenses will be lower for Class I than Class II,
dividends distributed to Class II Shares will generally be higher
than those distributed to Class II Shares. Income dividends and
capital gain distributions paid by a Fund, other than on those
Shares whose owners keep them registered in the name of a broker-
dealer, are automatically reinvested on the payable date in whole
or fractional Shares at net asset value as of the ex-dividend
date, unless a Shareholder makes a written or telephonic request
for payments in cash. Dividend and capital gain distributions
are eligible for investment in the same Class of Shares of a Fund
or the same class of another fund in the Franklin Group of Funds
or Templeton Family of Funds at net asset value. Income
dividends and capital gains distributions will be paid in cash on
Shares during the time their owners keep them registered in the
name of a broker-dealer, unless the broker-dealer has made
arrangements with the Transfer Agent for reinvestment.
Prior to purchasing Shares of a Fund, the impact of
dividends or capital gains distributions which have been declared
but not yet paid should be carefully considered. Any dividend or
capital gains distribution paid shortly after a purchase by a
<PAGE>
Shareholder prior to the record date will have the effect of
reducing the per Share net asset value of the Shares by the
amount of the dividend or distribution. All or a portion of such
dividend or distribution, although in effect a return of capital,
generally will be subject to tax.
Checks are forwarded by first-class mail to the address of
record. The proceeds of any such checks which are not accepted
by the addressee and returned to the Trust will be reinvested for
the Shareholder's account in whole or fractional Shares at the
net asset value next computed after the check has been received
by the Transfer Agent. Subsequent distributions automatically
will be reinvested at net asset value as of the ex-dividend date
in additional whole or fractional Shares.
Federal Tax Information. Each Fund intends to elect to be
treated and to qualify each year as a regulated investment
company under Subchapter M of the Code. See the SAI for a
summary of requirements that must be satisfied to so qualify. A
regulated investment company generally is not subject to Federal
income tax on income and gains distributed in a timely manner to
its shareholders. Each Fund intends to distribute to
Shareholders substantially all of its net investment income and
realized capital gains, which generally will be taxable income or
capital gains in their hands. Distributions declared in October,
November or December to Shareholders of record on a date in such
month and paid during the following January will be treated as
having been received by Shareholders on December 31 in the year
<PAGE>
such distributions were declared. The Trust will inform
Shareholders each year of the amount and nature of such income or
gains. A more detailed description of tax consequences to
Shareholders is contained in the SAI under the heading "Tax
Status."
Each Fund may be required to withhold Federal income tax at
the rate of 31% of all taxable distributions (including
redemptions) paid to Shareholders who fail to provide a Fund with
their correct taxpayer identification number or to make required
certifications or where a Fund or the Shareholder has been
notified by the Internal Revenue Service that the Shareholder is
subject to backup withholding. Corporate Shareholders and
certain other Shareholders specified in the Code are exempt from
backup withholding. Backup withholding is not an additional tax.
Any amounts withheld may be credited against the Shareholder's
Federal income tax liability.
Inquiries. Shareholders' inquiries will be answered
promptly. They should be addressed to Franklin Templeton
Investor Services, Inc., 700 Central Avenue, P.O. Box 33030, St.
Petersburg, Florida 33733-8030 -- telephone 1-800-354-9191 or
813-823-8712. Transcripts of Shareholder accounts less than
three years old are provided on request without charge; requests
for transcripts going back more than three years from the date
the request is received by the Transfer Agent are subject to a
fee of up to $15 per account.
<PAGE>
Performance Information. Each Fund may include its total
return in advertisements or reports to Shareholders or prospec-
tive investors. Quotations of average annual total return will
be expressed in terms of the average annual compounded rate of
return on a hypothetical investment in a Fund over a period of 1,
5 and 10 years (or up to the life of the Fund), will reflect the
deduction of the maximum initial sales charge and deduction of a
proportional share of Fund expenses (on an annual basis), and
will assume that all dividends and distributions are reinvested
when paid. Total return may be expressed in terms of the
cumulative value of an investment in a Fund at the end of a
defined period of time. For a description of the methods used to
determine total return for the Funds, see the SAI.
Statements and Reports. Each Fund's fiscal year ends on
March 31. Annual reports (containing financial statements
audited by independent auditors and additional information
regarding the Fund's performance) and semi-annual reports
(containing unaudited financial statements) are sent to
Shareholders each year. Additional copies may be obtained,
without charge, upon request to the Account Services Department.
The Fund also sends to each Shareholder a confirmation statement
after every transaction that affects the Shareholder's account
and a year-end historical confirmation statement.
<PAGE>
TEMPLETON GLOBAL INVESTMENT TRUST
THIS STATEMENT OF ADDITIONAL INFORMATION, DATED JUNE 27, 1994,
AS SUPPLEMENTED MAY __, 1995,
IS NOT A PROSPECTUS. IT SHOULD BE READ IN CONJUNCTION WITH
THE PROSPECTUSES OF TEMPLETON GLOBAL RISING DIVIDENDS FUND AND
TEMPLETON GLOBAL INFRASTRUCTURE FUND, EACH
DATED MARCH 14, 1994, TEMPLETON AMERICAS GOVERNMENT
SECURITIES FUND, DATED JUNE 27, 1994,
AND TEMPLETON GREATER EUROPEAN FUND AND
TEMPLETON LATIN AMERICA FUND, DATED MAY __, 1995, EACH AS
SUPPLEMENTED FROM TIME TO TIME, WHICH MAY BE OBTAINED
WITHOUT CHARGE UPON REQUEST TO THE PRINCIPAL UNDERWRITER,
FRANKLIN TEMPLETON DISTRIBUTORS, INC.,
700 CENTRAL AVENUE, P.O. BOX 33030
ST. PETERSBURG, FLORIDA 33733-8030
TOLL FREE TELEPHONE: (800) 237-0738
TABLE OF CONTENTS
General Information and History 1 -Management Fees . . . 26
Investment Objectives and Policies -The Investment Managers 27
. . . . . . . . . . . . . . 2 -Sub-Advisory Agreement 27
-Investment Policies . . 2 -Business Manager . . . 28
-Repurchase Agreements . 2 -Custodian and Transfer Agent 30
-Debt Securities . . . . 2 -Legal Counsel . . . . 30
-Convertible Securities . 4 -Independent Accountants 30
-Futures Contracts . . . 5 -Reports to Shareholders 30
-Options on Securities, Indices Brokerage Allocation . . 31
and Futures . . . . . . 5 Purchase, Redemption and Pricing of
-Foreign Currency Hedging Shares . . . . . . . . 34
Transactions . . . . . . . 8 -Ownership and Authority Disputes
-Investment Restrictions 9 . . . . . . . . . . . . . 34
-Additional Restrictions 11 -Tax Deferred Retirement Plans
-Risk Factors . . . . . . 12 . . . . . . . . . . . . . 35
-Trading Policies . . . . 15 -Letter of Intent . . . 36
-Personal Securities Tax Status . . . . . . . 37
Transactions . . . . . . 16 Principal Underwriter . . 45
Management of the Trust . . 16 Description of Shares . . 47
Principal Shareholders . . 24 Performance Information . 47
Investment Management and Other Financial Statements . . 51
Services . . . . . . . . 24
-Investment Management
Agreements . . . . . . . 24
GENERAL INFORMATION AND HISTORY
Templeton Global Investment Trust (the "Trust") was
organized as a Delaware business trust on December 21, 1993, and
is registered under the Investment Company Act of 1940 (the "1940
Act") as an open-end management investment company with four
diversified series of Shares, Templeton Global Rising Dividends
Fund ("Rising Dividends Fund"), Templeton Global Infrastructure
<PAGE>
Fund ("Infrastructure Fund"), Templeton Greater European Fund
("Greater European Fund") and Templeton Latin America Fund
("Latin America Fund"), and one non-diversified series of Shares,
Templeton Americas Government Securities Fund ("Americas
Government Securities Fund"), (collectively, the "Funds").
INVESTMENT OBJECTIVES AND POLICIES
Investment Policies. The investment objective and policies
of each Fund are described in each Fund's Prospectus under the
heading "General Description--Investment Objective and Policies."
Repurchase Agreements. Repurchase agreements are contracts
under which the buyer of a security simultaneously commits to
resell the security to the seller at an agreed-upon price and
date. Under a repurchase agreement, the seller is required to
maintain the value of the securities subject to the repurchase
agreement at not less than their repurchase price. The
investment manager of each Fund (Templeton, Galbraith &
Hansberger Ltd. ("TGH") in the case of Rising Dividends Fund,
Greater European Fund and Latin America Fund, Templeton
Investment Counsel, Inc. ("TICI") in the case of Infrastructure
Fund, and TICI, through its Templeton Global Bond Managers
division, in the case of Americas Government Securities Fund
(collectively, the "Investment Managers")) will monitor the value
of such securities daily to determine that the value equals or
exceeds the repurchase price. Repurchase agreements may involve
risks in the event of default or insolvency of the seller,
including possible delays or restrictions upon a Fund's ability
to dispose of the underlying securities. A Fund will enter into
repurchase agreements only with parties who meet creditworthiness
standards approved by the Board of Trustees, i.e., banks or
broker-dealers which have been determined by a Fund's Investment
Manager to present no serious risk of becoming involved in
bankruptcy proceedings within the time frame contemplated by the
repurchase transaction.
Debt Securities. The Funds may invest in debt securities
that are rated in any rating category by Standard & Poor's
Corporation ("S&P") or Moody's Investors Service, Inc.
("Moody's") or that are unrated by any rating agency. As an
operating policy, which may be changed by the Board of Trustees
without Shareholder approval, neither Rising Dividends Fund,
Infrastructure Fund, Greater European Fund, nor Latin America
Fund will invest more than 5% of its assets in debt securities
rated lower than Baa by Moody's or BBB by S&P. The market value
of debt securities generally varies in response to changes in
interest rates and the financial condition of each issuer.
During periods of declining interest rates, the value of debt
securities generally increases. Conversely, during periods of
rising interest rates, the value of such securities generally
declines. These changes in market value will be reflected in a
Fund's net asset value.
<PAGE>
Bonds which are rated Baa by Moody's are considered as
medium grade obligations, i.e., they are neither highly protected
nor poorly secured. Interest payments and principal security
appear adequate for the present but certain protective elements
may be lacking or may be characteristically unreliable over any
great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as
well. Bonds which are rated C by Moody's are the lowest rated
class of bonds, and issues so rated can be regarded as having
extremely poor prospects of ever attaining any real investment
standing.
Bonds rated BBB by S&P are regarded as having an adequate
capacity to pay interest and repay principal. Whereas they
normally exhibit adequate protection parameters, adverse economic
conditions or changing circumstances are more likely to lead to a
weakened capacity to pay interest and repay principal for bonds
in this category than in higher rated categories. Bonds rated D
by S&P are the lowest rated class of bonds, and generally are in
payment default. The D rating also will be used upon the filing
of a bankruptcy petition if debt service payments are
jeopardized.
Although they may offer higher yields than do higher rated
securities, high risk, low rated debt securities (commonly
referred to as "junk bonds") and unrated debt securities
generally involve greater volatility of price and risk of
principal and income, including the possibility of default by, or
bankruptcy of, the issuers of the securities. In addition, the
markets in which low rated and unrated debt securities are traded
are more limited than those in which higher rated securities are
traded. The existence of limited markets for particular
securities may diminish a Fund's ability to sell the securities
at fair value either to meet redemption requests or to respond to
a specific economic event such as a deterioration in the
creditworthiness of the issuer. Reduced secondary market
liquidity for certain low rated or unrated debt securities may
also make it more difficult for a Fund to obtain accurate market
quotations for the purposes of valuing the Fund's portfolio.
Market quotations are generally available on many low rated or
unrated securities only from a limited number of dealers and may
not necessarily represent firm bids of such dealers or prices for
actual sales.
Adverse publicity and investor perceptions, whether or not
based on fundamental analysis, may decrease the values and
liquidity of low rated debt securities, especially in a thinly
traded market. Analysis of the creditworthiness of issuers of
low rated debt securities may be more complex than for issuers of
higher rated securities, and the ability of a Fund to achieve its
investment objective may, to the extent of investment in low
rated debt securities, be more dependent upon such
creditworthiness analysis than would be the case if the Fund were
investing in higher rated securities.
<PAGE>
Low rated debt securities may be more susceptible to real or
perceived adverse economic and competitive industry conditions
than investment grade securities. The prices of low rated debt
securities have been found to be less sensitive to interest rate
changes than higher rated investments, but more sensitive to
adverse economic downturns or individual corporate developments.
A projection of an economic downturn or of a period of rising
interest rates, for example, could cause a decline in low rated
debt securities prices because the advent of a recession could
lessen the ability of a highly leveraged company to make
principal and interest payments on its debt securities. If the
issuer of low rated debt securities defaults, a Fund may incur
additional expenses seeking recovery.
A Fund may accrue and report interest income on high yield
bonds, such as zero coupon bonds or pay-in-kind securities, even
though it receives no cash interest until the security's maturity
or payment date. In order to qualify for beneficial tax
treatment afforded regulated investment companies, and to
generally be relieved of federal tax liabilities, a Fund must
distribute all of its net income and gains to Shareholders (see
"Tax Status") generally on an annual basis. A Fund may have to
dispose of portfolio securities under disadvantageous
circumstances to generate cash or leverage itself by borrowing
cash in order to satisfy the distribution requirement.
Recent legislation, which requires federally-insured savings
and loan associations to divest their investments in low rated
debt securities, may have a material adverse effect on a Fund's
net asset value and investment practices.
Convertible Securities. The Funds may invest in convertible
securities, including convertible debt and convertible preferred
stock. Convertible securities are fixed income securities which
may be converted at a stated price within a specific amount of
time into a specified number of shares of common stock. These
securities are usually senior to common stock in a corporation's
capital structure, but usually are subordinated to non-
convertible debt securities. In general, the value of a
convertible security is the higher of its investment value (its
value as a fixed income security) and its conversion value (the
value of the underlying shares of common stock if the security is
converted). The investment value of a convertible security
generally increases when interest rates decline and generally
decreases when interest rates rise. The conversion value of a
convertible security is influenced by the value of the underlying
common stock.
Futures Contracts. Each Fund may purchase and sell
financial futures contracts. Although some financial futures
contracts call for making or taking delivery of the underlying
securities, in most cases these obligations are closed out before
<PAGE>
the settlement date. The closing of a contractual obligation is
accomplished by purchasing or selling an identical offsetting
futures contract. Other financial futures contracts by their
terms call for cash settlements.
Each Fund may also buy and sell index futures contracts with
respect to any stock or bond index traded on a recognized stock
exchange or board of trade. An index futures contract is a
contract to buy or sell units of an index at a specified future
date at a price agreed upon when the contract is made. The index
futures contract specifies that no delivery of the actual
securities making up the index will take place. Instead,
settlement in cash must occur upon the termination of the
contract, with the settlement being the difference between the
contract price and the actual level of the index at the
expiration of the contract.
At the time a Fund purchases a futures contract, an amount
of cash, U.S. Government securities, or other highly liquid debt
securities equal to the market value of the contract will be
deposited in a segregated account with the Fund's custodian.
When writing a futures contract, a Fund will maintain with its
custodian liquid assets that, when added to the amounts deposited
with a futures commission merchant or broker as margin, are equal
to the market value of the instruments underlying the contract.
Alternatively, a Fund may "cover" its position by owning the
instruments underlying the contract or, in the case of an index
futures contract, owning a portfolio with a volatility
substantially similar to that of the index on which the futures
contract is based, or holding a call option permitting the Fund
to purchase the same futures contract at a price no higher than
the price of the contract written by the Fund (or at a higher
price if the difference is maintained in liquid assets with the
Fund's custodian).
Options on Securities, Indices and Futures. Each Fund may
write covered put and call options and purchase put and call
options on securities, securities indices and futures contracts
that are traded on United States and foreign exchanges and in the
over-the-counter markets.
An option on a security or a futures contract is a contract
that gives the purchaser of the option, in return for the premium
paid, the right to buy a specified security or futures contract
(in the case of a call option) or to sell a specified security or
futures contract (in the case of a put option) from or to the
writer of the option at a designated price during the term of the
option. An option on a securities index gives the purchaser of
the option, in return for the premium paid, the right to receive
from the seller cash equal to the difference between the closing
price of the index and the exercise price of the option.
Each Fund may write a call or put option only if the option
is "covered." A call option on a security or futures contract
<PAGE>
written by a Fund is "covered" if the Fund owns the underlying
security or futures contract covered by the call or has an
absolute and immediate right to acquire that security without
additional cash consideration (or for additional cash
consideration held in a segregated account by its custodian) upon
conversion or exchange of other securities held in its portfolio.
A call option on a security or futures contract is also covered
if a Fund holds a call on the same security or futures contract
and in the same principal amount as the call written where the
exercise price of the call held (a) is equal to or less than the
exercise price of the call written or (b) is greater than the
exercise price of the call written if the difference is
maintained by the Fund in cash or high grade U.S. Government
securities in a segregated account with its custodian. A put
option on a security or futures contract written by a Fund is
"covered" if the Fund maintains cash or fixed income securities
with a value equal to the exercise price in a segregated account
with its custodian, or else holds a put on the same security or
futures contract and in the same principal amount as the put
written where the exercise price of the put held is equal to or
greater than the exercise price of the put written.
A Fund will cover call options on securities indices that it
writes by owning securities whose price changes, in the opinion
of the Fund's Investment Manager, are expected to be similar to
those of the index, or in such other manner as may be in
accordance with the rules of the exchange on which the option is
traded and applicable laws and regulations. Nevertheless, where
a Fund covers a call option on a securities index through
ownership of securities, such securities may not match the
composition of the index. In that event, a Fund will not be
fully covered and could be subject to risk of loss in the event
of adverse changes in the value of the index. A Fund will cover
put options on securities indices that it writes by segregating
assets equal to the option's exercise price, or in such other
manner as may be in accordance with the rules of the exchange on
which the option is traded and applicable laws and regulations.
A Fund will receive a premium from writing a put or call
option, which increases its gross income in the event the option
expires unexercised or is closed out at a profit. If the value
of a security, index or futures contract on which a Fund has
written a call option falls or remains the same, the Fund will
realize a profit in the form of the premium received (less
transaction costs) that could offset all or a portion of any
decline in the value of the portfolio securities being hedged.
If the value of the underlying security, index or futures
contract rises, however, a Fund will realize a loss in its call
option position, which will reduce the benefit of any unrealized
appreciation in its investments. By writing a put option, a Fund
assumes the risk of a decline in the underlying security, index
or futures contract. To the extent that the price changes of the
portfolio securities being hedged correlate with changes in the
value of the underlying security, index or futures contract,
<PAGE>
writing covered put options will increase a Fund's losses in the
event of a market decline, although such losses will be offset in
part by the premium received for writing the option.
Each Fund may also purchase put options to hedge its
investments against a decline in value. By purchasing a put
option, a Fund will seek to offset a decline in the value of the
portfolio securities being hedged through appreciation of the put
option. If the value of a Fund's investments does not decline as
anticipated, or if the value of the option does not increase, its
loss will be limited to the premium paid for the option plus
related transaction costs. The success of this strategy will
depend, in part, on the accuracy of the correlation between the
changes in value of the underlying security, index or futures
contract and the changes in value of a Fund's security holdings
being hedged.
A Fund may purchase call options on individual securities or
futures contracts to hedge against an increase in the price of
securities or futures contracts that it anticipates purchasing in
the future. Similarly, a Fund may purchase call options on a
securities index to attempt to reduce the risk of missing a broad
market advance, or an advance in an industry or market segment,
at a time when the Fund holds uninvested cash or short-term debt
securities awaiting investment. When purchasing call options, a
Fund will bear the risk of losing all or a portion of the premium
paid if the value of the underlying security, index or futures
contract does not rise.
There can be no assurance that a liquid market will exist
when a Fund seeks to close out an option position. Trading could
be interrupted, for example, because of supply and demand
imbalances arising from a lack of either buyers or sellers, or
the options exchange could suspend trading after the price has
risen or fallen more than the maximum specified by the exchange.
Although a Fund may be able to offset to some extent any adverse
effects of being unable to liquidate an option position, it may
experience losses in some cases as a result of such inability.
The value of over-the-counter options purchased by a Fund, as
well as the cover for options written by a Fund, are considered
not readily marketable and are subject to the Trust's limitation
on investments in securities that are not readily marketable.
See "Investment Objectives and Policies -- Investment
Restrictions."
Foreign Currency Hedging Transactions. In order to hedge
against foreign currency exchange rate risks, each Fund may enter
into forward foreign currency exchange contracts and foreign
currency futures contracts, as well as purchase put or call
options on foreign currencies, as described below. Each Fund may
also conduct its foreign currency exchange transactions on a spot
(i.e., cash) basis at the spot rate prevailing in the foreign
currency exchange market.
<PAGE>
A Fund may enter into forward foreign currency exchange
contracts ("forward contracts") to attempt to minimize the risk
to the Fund from adverse changes in the relationship between the
U.S. dollar and foreign currencies. A forward contract is an
obligation to purchase or sell a specific currency for an agreed
price at a future date which is individually negotiated and
privately traded by currency traders and their customers. A Fund
may enter into a forward contract, for example, when it enters
into a contract for the purchase or sale of a security
denominated in a foreign currency in order to "lock in" the U.S.
dollar price of the security. In addition, for example, when a
Fund believes that a foreign currency may suffer or enjoy a
substantial movement against another currency, it may enter into
a forward contract to sell an amount of the former foreign
currency approximating the value of some or all of its portfolio
securities denominated in such foreign currency. This second
investment practice is generally referred to as "cross-hedging."
Because in connection with a Fund's forward foreign currency
transactions, an amount of its assets equal to the amount of the
purchase will be held aside or segregated to be used to pay for
the commitment, a Fund will always have cash, cash equivalents or
high quality debt securities available in an amount sufficient to
cover any commitments under these contracts or to limit any
potential risk. The segregated account will be marked-to-market
on a daily basis. While these contracts are not presently
regulated by the Commodity Futures Trading Commission ("CFTC"),
the CFTC may in the future assert authority to regulate forward
contracts. In such event, the Funds' ability to utilize forward
contracts in the manner set forth above may be restricted.
Forward contracts may limit potential gain from a positive change
in the relationship between the U.S. dollar and foreign
currencies. Unanticipated changes in currency prices may result
in poorer overall performance for a Fund than if it had not
engaged in such contracts.
A Fund may purchase and write put and call options on
foreign currencies for the purpose of protecting against declines
in the dollar value of foreign portfolio securities and against
increases in the dollar cost of foreign securities to be
acquired. As is the case with other kinds of options, however,
the writing of an option on foreign currency will constitute only
a partial hedge up to the amount of the premium received, and a
Fund could be required to purchase or sell foreign currencies at
disadvantageous exchange rates, thereby incurring losses. The
purchase of an option on foreign currency may constitute an
effective hedge against fluctuation in exchange rates, although,
in the event of rate movements adverse to its position, a Fund
may forfeit the entire amount of the premium plus related
transaction costs. Options on foreign currencies to be written
or purchased by a Fund will be traded on U.S. and foreign
exchanges or over-the-counter.
A Fund may enter into exchange-traded contracts for the
purchase or sale for future delivery of foreign currencies
<PAGE>
("foreign currency futures"). This investment technique will be
used only to hedge against anticipated future changes in exchange
rates which otherwise might adversely affect the value of a
Fund's portfolio securities or adversely affect the prices of
securities that a Fund intends to purchase at a later date. The
successful use of foreign currency futures will usually depend on
the ability of a Fund's Investment Manager to forecast currency
exchange rate movements correctly. Should exchange rates move in
an unexpected manner, a Fund may not achieve the anticipated
benefits of foreign currency futures or may realize losses.
Investment Restrictions. The Funds have imposed upon
themselves certain investment restrictions which, together with
their investment objectives, are fundamental policies except as
otherwise indicated. No changes in a Fund's investment objective
or these investment restrictions can be made without the approval
of the Shareholders of that Fund. For this purpose, the
provisions of the 1940 Act require the affirmative vote of the
lesser of either (1) 67% or more of that Fund's Shares present at
a Shareholders' meeting at which more than 50% of the outstanding
Shares are present or represented by proxy or (2) more than 50%
of the outstanding Shares of that Fund.
In accordance with these restrictions, each Fund will not:
1. Invest in real estate or mortgages on real estate
(although the Funds may invest in marketable securities
secured by real estate or interests therein); invest in
other open-end investment companies (except in
connection with a merger, consolidation, acquisition or
reorganization); invest in interests (other than
publicly issued debentures or equity stock interests)
in oil, gas or other mineral exploration or development
programs; or purchase or sell commodity contracts
(except futures contracts as described in a Fund's
Prospectus).
2. Purchase any security (other than obligations of the
U.S. Government, its agencies or instrumentalities) if,
as a result, as to 75% of a Fund's total assets (i)
more than 5% of the Fund's total assets would then be
invested in securities of any single issuer, or (ii)
the Fund would then own more than 10% of the voting
securities of any single issuer; provided, however,
that this restriction does not apply to Americas
Government Securities Fund.
3. Act as an underwriter; issue senior securities except
as set forth in investment restriction 6 below; or
purchase on margin or sell short, except that each Fund
may make margin payments in connection with futures,
options and currency transactions.
<PAGE>
4. Loan money, except that a Fund may (i) purchase a
portion of an issue of publicly distributed bonds,
debentures, notes and other evidences of indebtedness,
(ii) enter into repurchase agreements and (iii) lend
its portfolio securities.
5. Borrow money, except that a Fund may borrow money from
banks in an amount not exceeding 33-1/3% of the value
of its total assets (including the amount borrowed).
6. Mortgage, pledge or hypothecate its assets (except as
may be necessary in connection with permitted
borrowings); provided, however, this does not prohibit
escrow, collateral or margin arrangements in connection
with its use of options, futures contracts and options
on future contracts.
7. Invest more than 25% of its total assets in a single
industry.
8. Participate on a joint or a joint and several basis in
any trading account in securities. (See "Investment
Objectives and Policies -- Trading Policies" as to
transactions in the same securities for the Funds
and/or other mutual funds and clients with the same or
affiliated advisers.)
If a Fund receives from an issuer of securities held by the
Fund subscription rights to purchase securities of that issuer,
and if the Fund exercises such subscription rights at a time when
the Fund's portfolio holdings of securities of that issuer would
otherwise exceed the limits set forth in Investment Restrictions
2 or 7 above, it will not constitute a violation if, prior to
receipt of securities upon exercise of such rights, and after
announcement of such rights, the Fund has sold at least as many
securities of the same class and value as it would receive on
exercise of such rights.
Additional Restrictions. Each Fund has adopted the
following additional restrictions which are not fundamental and
which may be changed without Shareholder approval, to the extent
permitted by applicable law, regulation or regulatory policy.
Under these restrictions, a Fund may not:
1. Purchase or retain securities of any company in which
Trustees or officers of the Trust or of a Fund's
Investment Manager, individually owning more than 1/2
of 1% of the securities of such company, in the
aggregate own more than 5% of the securities of such
company.
2. Invest more than 5% of the value of its total assets in
securities of issuers which have been in continuous
operation less than three years.
<PAGE>
3. Invest more than 5% of its net assets in warrants
whether or not listed on the New York or American Stock
Exchanges, and more than 2% of its net assets in
warrants that are not listed on those exchanges.
Warrants acquired in units or attached to securities
are not included in this restriction.
4. Purchase or sell real estate limited partnership
interests.
5. Purchase or sell interests in oil, gas and mineral
leases (other than securities of companies that invest
in or sponsor such programs).
6. Invest for the purpose of exercising control over
management of any company.
7. Purchase more than 10% of a company's outstanding
voting securities.
8. Invest more than 15% of the Fund's total assets in
securities that are not readily marketable (including
repurchase agreements maturing in more than seven days
and over-the-counter options purchased by the Fund),
including no more than 10% of its total assets in
restricted securities. Rule 144A securities are not
subject to the 10% limitation on restricted securities,
although a Fund will limit its investment in all
restricted securities, including 144A securities, to
15% of its total assets.
Whenever any investment restriction states a maximum
percentage of a Fund's assets which may be invested in any
security or other property, it is intended that such maximum
percentage limitation be determined immediately after and as a
result of the Fund's acquisition of such security or property.
Assets are calculated as described in each Fund's Prospectus
under the heading "How to Buy Shares of the Fund."
Risk Factors. Each Fund has the right to purchase
securities in any foreign country, developed or underdeveloped.
Investors should consider carefully the substantial risks
involved in securities of companies and governments of foreign
nations, which are in addition to the usual risks inherent in
domestic investments.
There may be less publicly available information about
foreign companies comparable to the reports and ratings published
about companies in the United States. Foreign companies are not
generally subject to uniform accounting, auditing and financial
reporting standards, and auditing practices and requirements may
not be comparable to those applicable to United States companies.
<PAGE>
Foreign markets have substantially less volume than the New York
Stock Exchange and securities of some foreign companies are less
liquid and more volatile than securities of comparable United
States companies. Commission rates in foreign countries, which
are generally fixed rather than subject to negotiation as in the
United States, are likely to be higher. In many foreign
countries there is less government supervision and regulation of
stock exchanges, brokers and listed companies than in the United
States.
Investments in companies domiciled in developing countries
may be subject to potentially higher risks than investments in
developed countries. These risks include (i) less social,
political and economic stability; (ii) the small current size of
the markets for such securities and the currently low or
nonexistent volume of trading, which result in a lack of
liquidity and in greater price volatility; (iii) certain national
policies which may restrict a Fund's investment opportunities,
including restrictions on investment in issuers or industries
deemed sensitive to national interests; (iv) foreign taxation;
(v) the absence of developed structures governing private or
foreign investment or allowing for judicial redress for injury to
private property; (vi) the absence, until recently in certain
Eastern European countries, of a capital market structure or
market-oriented economy; and (vii) the possibility that recent
favorable economic developments in Eastern Europe may be slowed
or reversed by unanticipated political or social events in such
countries.
Despite the recent dissolution of the Soviet Union, the
Communist Party may continue to exercise a significant role in
certain Eastern European countries. To the extent of the
Communist Party's influence, investments in such countries will
involve risks of nationalization, expropriation and confiscatory
taxation. The communist governments of a number of Eastern
European countries expropriated large amounts of private property
in the past, in many cases without adequate compensation, and
there can be no assurance that such expropriation will not occur
in the future. In the event of such expropriation, a Fund could
lose a substantial portion of any investments it has made in the
affected countries. Further, no accounting standards exist in
Eastern European countries. Finally, even though certain Eastern
European currencies may be convertible into U.S. dollars, the
conversion rates may be artificial to the actual market values
and may be adverse to Fund Shareholders.
Certain Eastern European countries, which do not have market
economies, are characterized by an absence of developed legal
structures governing private and foreign investments and private
property. Certain countries require governmental approval prior
to investments by foreign persons, or limit the amount of
investment by foreign persons in a particular company, or limit
the investment of foreign persons to only a specific class of
securities of a company that may have less advantageous terms
<PAGE>
than securities of the company available for purchase by
nationals.
Authoritarian governments in certain Eastern European
countries may require that a governmental or quasi-governmental
authority act as custodian of a Fund's assets invested in such
country. To the extent such governmental or quasi-governmental
authorities do not satisfy the requirements of the 1940 Act to
act as foreign custodians of a Fund's cash and securities, the
Fund's investment in such countries may be limited or may be
required to be effected through intermediaries. The risk of loss
through governmental confiscation may be increased in such
countries.
The Greater European Fund may invest a portion of its assets
in Russian Securities. Because of the recent formation of the
securities markets as well as the underdeveloped state of the
banking and telecommunications systems, settlement, clearing and
registration of securities transactions in Russia are subject to
significant risk. Ownership of shares (except where shares are
held through depositories) is defined according to entries in the
company's share register and normally evidenced by extracts from
the register or by formal share certificates. However, there is
no central registration system and these services are carried out
by the companies themselves or by registrars located throughout
Russia. These registrars are not necessarily subject to state
supervision and it is possible for the Fund to lose its
registration through fraud, negligence or even mere oversight.
While the Fund will endeavor to ensure that its interest
continues to be appropriately recorded by obtaining extracts of
share registers through regular audits, these extracts have no
legal enforceability. In addition, while applicable Russian
regulations impose liability on registrars for losses resulting
from their errors it may be difficult for the Fund to enforce any
rights it may have against the registrar or issuer of the
securities in the event of loss of share registration.
Furthermore, while a Russian public enterprise with more than
1,000 shareholders is required by law to contract out the
maintenance of its shareholder register to an independent entity
that meets certain statutory criteria, in practice, this
regulation has not been strictly enforced. Because of this lack
of independence, management of a company may be able to exert
considerable influence over who can purchase and sell the
company's shares by illegally refusing to record transactions on
the share register. Moreover, since the local postal and banking
systems may not meet the same standards as those of Western
countries, no guarantee can be given that all entitlements
attaching to securities acquired by the Fund, including those
relating to dividends, can be realized. There is the risk that
payments of dividends or other distributions by bank wire or
check sent through the mail could be delayed or lost. In
addition, there is the risk of loss in connection with the
insolvency of an issuer's bank or transfer agent, particular
because these institutions are not guaranteed by the state.
<PAGE>
Each Fund endeavors to buy and sell foreign currencies on as
favorable a basis as practicable. Some price spread on currency
exchange (to cover service charges) may be incurred, particularly
when a Fund changes investments from one country to another or
when proceeds of the sale of Shares in U.S. dollars are used for
the purchase of securities in foreign countries. Also, some
countries may adopt policies which would prevent a Fund from
transferring cash out of the country or withhold portions of
interest and dividends at the source. There is the possibility
of expropriation, nationalization or confiscatory taxation,
withholding and other foreign taxes on income or other amounts,
foreign exchange controls (which may include suspension of the
ability to transfer currency from a given country), default in
foreign government securities, political or social instability or
diplomatic developments which could affect investments in
securities of issuers in foreign nations.
The Funds may be affected either unfavorably or favorably by
fluctuations in the relative rates of exchange between the
currencies of different nations, by exchange control regulations
and by indigenous economic and political developments. Through
the flexible policy of the Funds, the Investment Managers
endeavor to avoid unfavorable consequences and to take advantage
of favorable developments in particular nations where from time
to time they place the Funds' investments.
The exercise of this flexible policy may include decisions
to purchase securities with substantial risk characteristics and
other decisions such as changing the emphasis on investments from
one nation to another and from one type of security to another.
Some of these decisions may later prove profitable and others may
not. No assurance can be given that profits, if any, will exceed
losses.
The Trustees consider at least annually the likelihood of
the imposition by any foreign government of exchange control
restrictions which would affect the liquidity of the Funds'
assets maintained with custodians in foreign countries, as well
as the degree of risk from political acts of foreign governments
to which such assets may be exposed. They also consider the
degree of risk involved through the holding of portfolio
securities in domestic and foreign securities depositories (see
"Investment Management and other Services -- Custodian and
"Transfer Agent"). However, in the absence of willful
misfeasance, bad faith or gross negligence on the part of a
Fund's Investment Manager, any losses resulting from the holding
of portfolio securities in foreign countries and/or with
securities depositories will be at the risk of the Shareholders.
No assurance can be given that the Trustees' appraisal of the
risks will always be correct or that such exchange control
restrictions or political acts of foreign governments will not
occur.
<PAGE>
A Fund's ability to reduce or eliminate its futures and
related options positions will depend upon the liquidity of the
secondary markets for such futures and options. The Funds intend
to purchase or sell futures and related options only on exchanges
or boards of trade where there appears to be an active secondary
market, but there is no assurance that a liquid secondary market
will exist for any particular contract or at any particular time.
Use of futures and options for hedging may involve risks because
of imperfect correlations between movements in the prices of the
futures or options and movements in the prices of the securities
being hedged. Successful use of futures and related options by a
Fund for hedging purposes also depends upon that Fund's
Investment Manager's ability to predict correctly movements in
the direction of the market, as to which no assurance can be
given.
Additional risks may be involved with the Funds' special
investment techniques, including loans of portfolio securities
and borrowing for investment purposes. These risks are described
under the heading "Investment Techniques" in the Prospectus.
Trading Policies. The Investment Managers and their
affiliated companies serve as investment advisers to other
investment companies and private clients. Accordingly, the
respective portfolios of these funds and clients may contain many
or some of the same securities. When any two or more of these
funds or clients are engaged simultaneously in the purchase or
sale of the same security, the transactions are placed for
execution in a manner designed to be equitable to each party.
The larger size of the transaction may affect the price of the
security and/or the quantity which may be bought or sold for each
party. If the transaction is large enough, brokerage commissions
in certain countries may be negotiated below those otherwise
chargeable.
Sale or purchase of securities, without payment of brokerage
commissions, fees (except customary transfer fees) or other
remuneration in connection therewith, may be effected between any
of these funds, or between funds and private clients, under
procedures adopted pursuant to Rule 17a-7 under the 1940 Act.
Personal Securities Transactions. Access persons of the
Franklin Templeton Group, as defined in SEC Rule 17(j) under the
1940 Act, who are employees of Franklin Resources, Inc. or their
subsidiaries, are permitted to engage in personal securities
transactions subject to the following general restrictions and
procedures: (1) The trade must receive advance clearance from a
Compliance Officer and must be completed within 24 hours after
this clearance; (2) Copies of all brokerage confirmations must be
sent to the compliance officer and within 10 days after the end
of each calendar quarter, a report of all securities transactions
must be provided to the Compliance officer; (3) In addition to
items (1) and (2), access persons involved in preparing and
making investment decisions must file annual reports of their
<PAGE>
securities holdings each January and also inform the Compliance
Officer (or other designated personnel) if they own a security
that is being considered for a fund or other client transaction
or if they are recommending a security in which they have an
ownership interest for purchase or sale by a fund or other
client.
MANAGEMENT OF THE TRUST
The name, address, principal occupation during the past five
years and other information with respect to each of the Trustees
and Principal Executive Officers of the Trust are as follows:
Name, Address and Principal Occupation
Offices with Trust During Past Five Years
JOHN M. TEMPLETON* Chairman of the Board of other
Lyford Cay Templeton Funds; president of
Nassau, Bahamas First Trust Bank, Ltd., Nassau,
Chairman of the Board Bahamas, and previously Chairman
of the Board and employee of
Templeton, Galbraith &
Hansberger Ltd. (prior to
October 30, 1992).
CHARLES B. JOHNSON* President, chief executive
777 Mariners Island Blvd. officer, and director, Franklin
San Mateo, California Resources, Inc.; chairman of the
Trustee and Vice President board, Franklin Templeton
Distributors, Inc.; chairman of
the board and director, Franklin
Advisers, Inc.; director,
Franklin Administrative
Services, Inc. and General Host
Corporation; director of
Templeton Global Investors,
Inc.; director or trustee of
other Templeton Funds; and
officer and director, trustee or
managing general partner, as the
case may be, of most other
subsidiaries of Franklin and of
most of the investment companies
in the Franklin Group of Funds.
<PAGE>
Name, Address and Principal Occupation
Offices with Trust During Past Five Years
MARTIN L. FLANAGAN* Senior vice president,
777 Mariners Island Blvd. treasurer, and chief financial
San Mateo, California officer of Franklin Resources,
Trustee and Vice President Inc.; director and executive
vice president of Templeton
Investment Counsel, Inc. and
Templeton Global Investors,
Inc.; president or vice
president of the Templeton
Funds; accountant, Arthur
Andersen & Company (1982-1983);
member of the International
Society of Financial Analysts
and the American Institute of
Certified Public Accountants.
NICHOLAS F. BRADY* A director or trustee of other
The Bullitt House Templeton Funds; chairman of
102 East Dover Street Templeton Emerging Markets
Easton, Maryland Investment Trust PLC; chairman
Trustee and president of Darby Advisors,
Inc. (an investment firm) since
January, 1993; director of the
H. J. Heinz Company, Capital
Cities/ABC, Inc. and the
Christiana Companies; Secretary
of the United States Department
of the Treasury from 1988 to
January, 1993; chairman of the
board of Dillon, Read & Co. Inc.
(investment banking) prior
thereto.
HASSO-G VON DIERGARDT-NAGLO Farmer; president of Clairhaven
R.R. 3 Investments, Ltd. and other
Stouffville, Ontario private investment companies; a
Trustee director or trustee of other
Templeton Funds.
F. BRUCE CLARKE Retired; former credit advisor,
19 Vista View Blvd. National Bank of Canada,
Thornhill, Ontario Toronto; a director or trustee
Trustee of other Templeton Funds.
BETTY P. KRAHMER A director or trustee of other
2201 Kentmere Parkway Templeton Funds; director or
Wilmington, Delaware trustee of various civic
Trustee associations; former economic
analyst, U.S. Government.
<PAGE>
Name, Address and Principal Occupation
Offices with Trust During Past Five Years
FRED R. MILLSAPS A director or trustee of other
2665 N.E. 37th Drive Templeton Funds; manager of
Fort Lauderdale, Florida personal investments (1978-
Trustee present); chairman and chief
executive officer of Landmark
Banking Corporation (1969-1978);
financial vice president of
Florida Power and Light (1965-
1969); vice president of Federal
Reserve Bank of Atlanta (1958-
1965); director of various
business and nonprofit
organizations.
JOHN G. BENNETT, JR. A director or trustee of other
3 Radnor Corporate Center Templeton Funds; founder,
Suite 150 chairman of the board, and
100 Matsonford Road president of the Foundation for
Radnor, Pennsylvania New Era Philanthropy; president
Trustee and chairman of the boards of
the Evelyn M. Bennett Memorial
Foundation and NEP International
Trust; chairman of the board and
chief executive officer of The
Bennett Group International,
LTD; chairman of the boards of
Human Service Systems, Inc. and
Multi-Media Communicators, Inc.;
a director or trustee of many
national and international
organizations, universities, and
grant-making foundations serving
in various executive board
capacities; member of the Public
Policy Committee of the
Advertising Council.
ANDREW H. HINES, JR. Consultant, Triangle Consulting
150 2nd Avenue N. Group; chairman of the board and
St. Petersburg, Florida chief executive officer of
Trustee Florida Progress Corporation
(1982-February 1990) and
director of various of its
subsidiaries; chairman and
director of Precise Power
Corporation; Executive-in-
Residence of Eckerd College
(1991-present); director of
Checkers Drive-In Restaurants,
Inc.; a director or trustee of
other Templeton Funds.
<PAGE>
Name, Address and Principal Occupation
Offices with Trust During Past Five Years
HARRIS J. ASHTON Chairman of the board,
Metro Center president, and chief executive
1 Station Place officer of General Host
Stamford, Connecticut Corporation (nursery and craft
Trustee centers); director of RBC
Holdings Inc. (a bank holding
company) and Bar-S Foods;
director or trustee of other
Templeton Funds; and director,
trustee or managing general
partner, as the case may be, for
most of the investment companies
in the Franklin Group of Funds.
S. JOSEPH FORTUNATO Member of the law firm of
200 Campus Drive Pitney, Hardin, Kipp & Szuch;
Florham Park, New Jersey director of General Host
Trustee Corporation; director or trustee
of other Templeton Funds; and
director, trustee or managing
general partner, as the case may
be, for most of the investment
companies in the Franklin Group
of Funds.
GORDON S. MACKLIN Chairman of White River
8212 Burning Tree Road Corporation (information
Bethesda, Maryland services); director of Fund
Trustee America Enterprise Holdings,
Inc., Martin Marietta
Corporation, MCI Communications
Corporation and Medimmune, Inc.;
director or trustee of other
Templeton Funds; director,
trustee, or managing general
partner, as the case may be, of
most of the investment companies
in the Franklin Group of Funds;
formerly: chairman, Hambrecht
and Quist Group; director, H&Q
Healthcare Investors; and
president, National Association
of Securities Dealers, Inc.
MARK G. HOLOWESKO President and director of
Lyford Cay Templeton, Galbraith &
Nassau, Bahamas Hansberger Ltd.; director of
President global equity research for
Templeton Worldwide, Inc.;
president or vice president of
<PAGE>
Name, Address and Principal Occupation
Offices with Trust During Past Five Years
the Templeton Funds; investment
administrator with Roy West
Trust Corporation (Bahamas)
Limited (1984-1985).
SAMUEL J. FORESTER, JR. President of the Templeton
500 East Broward Blvd. Global Bond Managers Division of
Fort Lauderdale, Florida Templeton Investment Counsel,
Vice President Inc.; president or vice
president of other Templeton
Funds; founder and partner of
Forester, Hairston Investment
Management (1989-1990); managing
director (Mid-East Region) of
Merrill Lynch, Pierce, Fenner &
Smith Inc. (1987-1988); advisor
for Saudi Arabian Monetary
Agency (1982-1987).
DORIAN FOYIL Vice president, Portfolio
Lyford Cay Management/Research, of
Nassau, Bahamas Templeton, Galbraith &
Vice President Hansberger Ltd.; formerly,
research analyst, UBS Phillips &
Drew (London).
DOUGLAS R. LEMPEREUR Senior vice president of the
500 East Broward Blvd. Templeton Global Bond Managers
Fort Lauderdale, Florida Division of Templeton Investment
Vice President Counsel, Inc.; formerly,
securities analyst for Colonial
Management Associates (1985-
1988), Standish, Ayer & Wood
(1977-1985), and The First
National Bank of Chicago (1974-
1977).
JOHN R. KAY Vice president of the Templeton
500 East Broward Blvd. Funds; vice president and
Fort Lauderdale, Florida treasurer of Templeton Global
Vice President Investors, Inc. and Templeton
Worldwide, Inc.; assistant vice
president of Franklin Templeton
Distributors, Inc.; formerly,
vice president and controller of
the Keystone Group, Inc.
<PAGE>
Name, Address and Principal Occupation
Offices with Trust During Past Five Years
NEIL S. DEVLIN Senior vice president, Portfolio
500 East Broward Blvd. Management/Research, of the
Fort Lauderdale, Florida Templeton Global Bond Managers
Vice President division of Templeton Investment
Counsel, Inc.; formerly,
portfolio manager and bond
analyst, Constitutional Capital
Management (1985-1987); bond
trader and research analyst,
Bank of New England (1982-1985).
JAMES R. BAIO Certified public accountant;
500 East Broward Blvd. treasurer of the Templeton
Fort Lauderdale, Florida Funds; senior vice president,
Treasurer Templeton Worldwide, Inc.,
Templeton Global Investors,
Inc., and Templeton Funds Trust
Company; formerly, senior tax
manager of Ernst & Young
(certified public accountants)
(1977-1989).
THOMAS M. MISTELE Senior vice president of
700 Central Avenue Templeton Global Investors,
St. Petersburg, Florida Inc.; vice president of Franklin
Secretary Templeton Distributors, Inc.;
secretary of the Templeton
Funds; attorney, Dechert Price &
Rhoads (1985-1988) and Freehill,
Hollingdale & Page (1988);
judicial clerk, U.S. District
Court (Eastern District of
Virginia) (1984-1985).
JACK L. COLLINS Assistant treasurer of the
700 Central Avenue Templeton Funds; assistant vice
St. Petersburg, Florida president of Franklin Templeton
Assistant Treasurer Investor Services, Inc.; former
partner of Grant Thornton,
independent public accountants.
JEFFREY L. STEELE Partner, Dechert Price & Rhoads.
1500 K Street, N.W.
Washington, D.C.
Assistant Secretary
__________________________
* Messrs. Templeton, Johnson, Flanagan and Brady are Trustees
who are "interested persons" of the Trust as that term is
defined in the 1940 Act. Mr. Brady and Franklin Resources,
Inc. are limited partners of Darby Overseas Partners, L.P.
("Darby Overseas"). Mr. Brady established Darby Overseas in
February, 1994, and is Chairman and a shareholder of the
<PAGE>
corporate general partner of Darby Overseas. In addition,
Darby Overseas and Templeton, Galbraith & Hansberger Ltd.
are limited partners of Darby Emerging Markets Fund, L.P.
As indicated above, certain of the Directors and Officers
hold positions with other funds in the Franklin Group of Funds
and the Templeton Family of Funds. Each fund in the Templeton
Family of Funds pays its independent directors/trustees and Mr.
Brady an annual retainer and/or fees for attendance at board and
committee meetings, the amount of which is based on the level of
assets in the fund. Accordingly, the Trust pays each independent
Director and Mr. Brady an annual retainer of $__________ and a
fee of $_________ per meeting attended of the Board and its
committees. Directors are reimbursed for any expenses incurred
in attending meetings. During the fiscal year ended March 31,
1995, pursuant to the compensation arrangement then in effect,
fees totalling $______ were paid by the Trust to Messrs. Ashton
($_____), Bennett ($_____), Brady ($_____), Clarke ($_____),
Diergardt-Naglo ($_____), Fortunato ($_____), Hines ($_____),
Macklin ($_____), Millsaps ($_____) and Mrs. Krahmer ($_____).
For the fiscal year ended March 31, 1995, pursuant to the
compensation arrangement then in effect, Messrs. Ashton, Bennett,
Brady, Clarke, Diergardt-Naglo, Flanagan, Fortunato, Hines,
Charles B. Johnson, Macklin, Millsaps, Templeton and Mrs. Krahmer
received total fees of $_____, $_____, $_____, $_____, $_____,
$_____, $_____, $_____, $_____, $_____, $_____, $_____, and
$_____, respectively, from the various Franklin and Templeton
funds for which they serve as directors, trustees or managing
general partners. No Officer or Director received any other
compensation directly from the Trust.
PRINCIPAL SHAREHOLDERS
As of __________, 1995, there were ______ Shares of Rising
Dividends Fund outstanding, of which _____ Shares (0.__%) were
owned beneficially, directly or indirectly, by all the Trustees
and Officers of the Trust as a group. As of _________, 1995,
there were _________ Shares of Infrastructure Fund outstanding,
of which ______ Shares (0.__%) were owned beneficially, directly
or indirectly, by all the Trustees and Officers of the Trust as a
group. As of _________, 1995, there were ______ Shares of
Americas Government Securities Fund outstanding, of which _____
Shares (0.__%) were owned beneficially, directly or indirectly,
by all the Trustees and Officers of the Trust as a group. As of
_________, 1995, to the knowledge of management, no person owned
beneficially 5% or more of the outstanding Shares of Rising
Dividends Fund, except Templeton Global Investors, Inc., 500 E.
Broward Blvd., Suite 2100, Fort Lauderdale, Florida 33394 owned
______ Shares (____% of the outstanding Shares). As of ________,
1995, to the knowledge of management, no person owned
beneficially 5% or more of the outstanding Shares of
Infrastructure Fund, except Templeton Global Investors, Inc., 500
E. Broward Blvd., Suite 2100, Fort Lauderdale, Florida 33394
owned _____ Shares (____% of the outstanding Shares). As of
<PAGE>
_________, 1995, to the knowledge of management, no person owned
beneficially 5% or more of the outstanding Shares of Americas
Government Securities Fund, except Templeton Global Investors,
Inc., 500 E. Broward Blvd., Suite 2100, Fort Lauderdale, Florida
33394 owned _____ Shares (____% of the outstanding Shares) and
Kathlyn D. Fayette, 1829 Columbine Ave., Boulder, Colorado 80302
owned ______ Shares (____% of the outstanding Shares).
INVESTMENT MANAGEMENT AND OTHER SERVICES
Investment Management Agreements. The Investment Manager of
Rising Dividends Fund, Greater European Fund, and Latin America
Fund is Templeton, Galbraith & Hansberger Ltd., a Bahamian
corporation with offices in Nassau, Bahamas. The Investment
Manager of Infrastructure Fund is Templeton Investment Counsel,
Inc., a Florida corporation with offices located at Broward
Financial Centre, Fort Lauderdale, Florida 33394-3091. The
Investment Manager of Americas Government Securities Fund is
TICI, through the Templeton Global Bond Managers division. The
Investment Management Agreements, dated March 14, 1994, relating
to Rising Dividends Fund and Infrastructure Fund were approved by
the Board of Trustees, including a majority of the Trustees who
were not parties to the Agreements or interested persons of any
such party, at a meeting on February 25, 1994, and by Templeton
Global Investors, Inc., as sole Shareholder of Rising Dividends
Fund and Infrastructure Fund, on March 11, 1994 and will run
through July 31, 1995. The Investment Management Agreement,
dated June 27, 1994, relating to Americas Government Securities
Fund was approved by the Board of Trustees, including a majority
of the Trustees who were not interested parties to the Agreement
or interested persons of any such party, at a meeting held on
March 18, 1994, and by Templeton Global Investors, Inc., as sole
Shareholder of Americas Government Securities Fund, on June 27,
1994, and will run through July 31, 1995. The Investment
Management Agreements, dated May __, 1995, relating to Greater
European Fund and Latin America Fund were approved by the Board
of Trustees, including a majority of the Trustees who were not
parties to the Agreements or interested persons of any such
party, at a meeting on February 24, 1995, and by Templeton Global
Investors, Inc., as sole Shareholder of Greater European Fund and
Latin America Fund, on ________, 1995, and will run through
________, 199_. The Investment Management Agreements will
continue from year to year thereafter, subject to approval
annually by the Board of Trustees or by vote of a majority of the
outstanding Shares of each Fund (as defined in the 1940 Act) and
also, in either event, with the approval of a majority of those
Trustees who are not parties to the Agreements or interested
persons of any such party in person at a meeting called for the
purpose of voting on such approval.
Each Investment Management Agreement requires a Fund's
Investment Manager to manage the investment and reinvestment of
the Fund's assets. The Investment Managers are not required to
furnish any personnel, overhead items or facilities for the
<PAGE>
Funds, including daily pricing or trading desk facilities,
although such expenses are paid by investment advisers of some
other investment companies.
Each Investment Management Agreement provides that a Fund's
Investment Manager will select brokers and dealers for execution
of a Fund's portfolio transactions consistent with the Trust's
brokerage policies (see "Brokerage Allocation"). Although the
services provided by broker-dealers in accordance with the
brokerage policies incidentally may help reduce the expenses of
or otherwise benefit the Investment Managers and other investment
advisory clients of the Investment Managers and of their
affiliates, as well as the Funds, the value of such services is
indeterminable and the Investment Managers' fees are not reduced
by any offset arrangement by reason thereof.
When the Investment Manager of a Fund determines to buy or
sell the same security for a Fund that the Investment Manager or
one or more of its affiliates has selected for one or more of its
other clients or for clients of its affiliates, the orders for
all such securities transactions are placed for execution by
methods determined by the Investment Manager, with approval by
the Board of Trustees, to be impartial and fair, in order to seek
good results for all parties. See "Investment Objectives and
Policies -- Trading Policies." Records of securities
transactions of persons who know when orders are placed by a Fund
are available for inspection at least four times annually by the
Compliance Officer of the Trust so that the non-interested
Trustees (as defined in the 1940 Act) can be satisfied that the
procedures are generally fair and equitable to all parties.
Each Investment Management Agreement provides that a Fund's
Investment Manager shall have no liability to the Trust, a Fund
or any Shareholder of a Fund for any error of judgment, mistake
of law, or any loss arising out of any investment or other act or
omission in the performance by the Investment Manager of its
duties under the Agreement, except liability resulting from
willful misfeasance, bad faith or gross negligence on the
Investment Manager's part or reckless disregard of its duties
under the Agreement. Each Investment Management Agreement will
terminate automatically in the event of its assignment, and may
be terminated by the Trust on behalf of a Fund at any time
without payment of any penalty on 60 days' written notice, with
the approval of a majority of the Trustees in office at the time
or by vote of a majority of the outstanding voting securities of
that Fund (as defined in the 1940 Act).
Management Fees. For its services, Rising Dividends Fund
pays TGH a monthly fee equal on an annual basis to 0.75% of its
average daily net assets. Infrastructure Fund pays TICI a
monthly fee equal on an annual basis to 0.75% of its average
daily net assets. Americas Government Securities Fund pays TICI
a monthly fee equal on an annual basis to 0.60% of its average
daily net assets. Greater European Fund and Latin America Fund
<PAGE>
each pay TGH a monthly fee equal on an annual basis to 0.60% of
their average daily net assets. Each class of Shares of each
Fund pays a portion of the fee, determined by the proportion of a
Fund that it represents.
Each Fund's Investment Manager will comply with any
applicable state regulations which may require it to make
reimbursements to a Fund in the event that the Fund's aggregate
operating expenses, including the advisory fee, but generally
excluding interest, taxes, brokerage commissions and
extraordinary expenses, are in excess of specific applicable
limitations. The strictest rule currently applicable to a Fund
is 2.5% of the first $30,000,000 of net assets, 2% of the next
$70,000,000 of net assets and 1.5% of the remainder.
During the fiscal year ended March 31, 1995, TGH received
from Rising Dividends Fund fees of $____________, and TICI
received from Infrastructure Fund fees of $___________. During
the period from June 27, 1994 (commencement of operations)
through March 31, 1995, TICI received from Americas Government
Securities Fund fees of $_____________.
The Investment Managers. The Investment Managers are
indirect wholly owned subsidiaries of Franklin Resources, Inc.
("Franklin"), a publicly traded company whose shares are listed
on the New York Stock Exchange. Charles B. Johnson and Rupert H.
Johnson, Jr. are principal shareholders of Franklin and own,
respectively, approximately 24% and 16% of its outstanding
shares. Messrs. Charles B. Johnson and Rupert H. Johnson, Jr.
are brothers.
Sub-Advisory Agreement. Under a Sub-Advisory Agreement
between TICI and Franklin Advisers, Inc. ("Franklin Advisers"),
Franklin Advisers provides TICI with investment advisory
assistance and portfolio management advice with respect to
Americas Government Securities Fund's portfolio. Franklin
Advisers provides TICI on an ongoing basis with research
services, including information, analytical reports, computer
screening studies, statistical data and factual resumes
pertaining to securities. For its services, TICI pays to
Franklin Advisers a fee in U.S. dollars at an annual rate of
0.25% of Americas Government Securities Fund's average daily net
assets.
The Sub-Advisory Agreement provides that it will terminate
automatically in the event of its assignment and that it may be
terminated by the Trust on 60 days' written notice to TICI and to
Franklin Advisers, without penalty, provided that such
termination by the Trust is approved by the vote of a majority of
the Trust's Board of Trustees or by vote of a majority of
Americas Government Securities Fund's outstanding Shares. The
Agreement also provides that it may be terminated by either TICI
or Franklin Advisers upon not less than 60 days' written notice
to the other party. The Sub-Advisory Agreement dated June 27,
<PAGE>
1994 was approved by the Board of Trustees at a meeting held on
March 18, 1994, was approved by Templeton Global Investors, Inc.
as sole Shareholder of Americas Government Securities Fund on
June 27, 1994, and will run through July 31, 1995. The Agreement
will continue from year to year thereafter, subject to approval
annually by the Board of Trustees or by vote of a majority of the
outstanding Shares of Americas Government Securities Fund (as
defined in the 1940 Act) and also, in either event, with the
approval of a majority of those Trustees who are not parties to
the Agreement or interested persons of any such party in person
at a meeting called for the purpose of voting on such approval.
Franklin Advisers is relieved of liability to the Trust for any
act or omission in the course of its performance under the Sub-
Advisory Agreement, in the absence of willful misfeasance, bad
faith, gross negligence or reckless disregard of its obligations
under the Agreement.
Business Manager. Templeton Global Investors, Inc. performs
certain administrative functions as Business Manager for the
Funds, including:
providing office space, telephone, office equipment and
supplies for the Trust;
paying compensation of the Trust's officers for
services rendered as such;
authorizing expenditures and approving bills for
payment on behalf of the Funds;
supervising preparation of annual and semiannual
reports to Shareholders, notices of dividends, capital
gain distributions and tax credits, and attending to
correspondence and other special communications with
individual Shareholders;
daily pricing of each Fund's investment portfolio and
preparing and supervising publication of daily
quotations of the bid and asked prices of each Fund's
Shares, earnings reports and other financial data;
monitoring relationships with organizations serving the
Funds, including the custodian and printers;
providing trading desk facilities for the Funds;
supervising compliance by the Funds with recordkeeping
requirements under the 1940 Act and regulations
thereunder, with state regulatory requirements,
maintaining books and records for the Funds (other than
those maintained by the custodian and transfer agent),
and preparing and filing tax reports other than the
Funds' income tax returns;
<PAGE>
monitoring the qualifications of tax deferred
retirement plans providing for investment in Shares of
the Funds; and
providing executive, clerical and secretarial help
needed to carry out these responsibilities.
For its services, the Business Manager receives a monthly
fee equal on an annual basis to 0.15% of the first $200,000,000
of the Trust's aggregate average daily net assets (i.e., total of
the Funds), reduced to 0.135% annually of the Trust's aggregate
net assets in excess of $200,000,000, further reduced to 0.1%
annually of such net assets in excess of $700,000,000, and
further reduced to 0.075% annually of such net assets in excess
of $1,200,000,000. The fee is allocated between the Funds
according to their respective average daily net assets. Each
class of Shares of each Fund pays a portion of the fee,
determined by the proportion of the Fund that it represents.
Since the Business Manager's fee covers services often provided
by investment advisers to other funds, each Fund's combined
expenses for advisory and administrative services together may be
higher than those of some other investment companies. During the
fiscal year ended March 31, 1995, the Business Manager received
from Rising Dividends Fund and Infrastructure Fund business
management fees of $_______ and $________, respectively. During
the period from June 27, 1994 (commencement of operations)
through March 31, 1995, the Business Manager received from
Americas Government Securities Fund business management fees of
$___________.
The Business Manager is relieved of liability to the Trust
for any act or omission in the course of its performance under
the Business Management Agreement, in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of
its duties and obligations under the Agreement. The Business
Management Agreement may be terminated by the Trust on behalf of
a Fund at any time on 60 days' written notice without payment of
penalty, provided that such termination by the Trust shall be
directed or approved by vote of a majority of the Trustees of the
Trust in office at the time or by vote of a majority of the
outstanding voting securities of that Fund, and shall terminate
automatically and immediately in the event of its assignment.
Templeton Global Investors, Inc. is a wholly owned
subsidiary of Franklin.
Custodian and Transfer Agent. The Chase Manhattan Bank,
N.A. serves as Custodian of the Trust's assets, which are
maintained at the Custodian's principal office, MetroTech
Center, Brooklyn, New York 11245, and at the offices of its
branches and agencies throughout the world. The Custodian has
entered into agreements with foreign sub-custodians approved by
the Trustees pursuant to Rule 17f-5 under the 1940 Act. The
Custodian, its branches and sub-custodians generally
<PAGE>
domestically, and frequently abroad, do not actually hold
certificates for the securities in their custody, but instead
have book records with domestic and foreign securities
depositories, which in turn have book records with the transfer
agents of the issuers of the securities. Compensation for the
services of the Custodian is based on a schedule of charges
agreed on from time to time.
Franklin Templeton Investor Services, Inc. serves as the
Funds' Transfer Agent. Services performed by the Transfer Agent
include processing purchase, transfer and redemption orders,
making dividend payments, capital gain distributions and
reinvestments, and handling routine communications with
Shareholders. The Transfer Agent receives an annual fee of
$13.42 per Shareholder account plus out-of-pocket expenses from
Rising Dividends Fund and Infrastructure Fund and an annual fee
of $14.42 per Shareholder account plus out-of-pocket expenses
from Americas Government Securities Fund. These fees are
adjusted each year to reflect changes in the Department of Labor
Consumer Price Index.
Legal Counsel. Dechert Price & Rhoads, 1500 K Street, N.W.,
Washington, D.C. 20005, is legal counsel for the Trust.
Independent Accountants. The firm of McGladrey & Pullen,
LLP, 555 Fifth Avenue, New York, New York 10017, serves as
independent accountants for the Trust. Its audit services
comprise examination of the Funds' financial statements and
review of the Funds' filings with the Securities and Exchange
Commission and the Internal Revenue Service.
Reports to Shareholders. The Funds' fiscal years end on
March 31. Shareholders are provided at least semiannually with
reports showing the Funds' portfolios and other information,
including an annual report with financial statements audited by
the independent accountants.
BROKERAGE ALLOCATION
The Investment Management Agreements provide that each
Fund's Investment Manager is responsible for selecting members of
securities exchanges, brokers and dealers (such members, brokers
and dealers being hereinafter referred to as "brokers") for the
execution of the Fund's portfolio transactions and, when
applicable, the negotiation of commissions in connection
therewith. All decisions and placements are made in accordance
with the following principles:
1. Purchase and sale orders are usually placed with
brokers who are selected by a Fund's Investment Manager
as able to achieve "best execution" of such orders.
"Best execution" means prompt and reliable execution at
the most favorable securities price, taking into
account the other provisions hereinafter set forth.
<PAGE>
The determination of what may constitute best execution
and price in the execution of a securities transaction
by a broker involves a number of considerations,
including, without limitation, the overall direct net
economic result to a Fund (involving both price paid or
received and any commissions and other costs paid), the
efficiency with which the transaction is effected, the
ability to effect the transaction at all where a large
block is involved, availability of the broker to stand
ready to execute possibly difficult transactions in the
future, and the financial strength and stability of the
broker. Such considerations are judgmental and are
weighed by the Investment Managers in determining the
overall reasonableness of brokerage commissions.
2. In selecting brokers for portfolio transactions, each
Fund's Investment Manager takes into account its past
experience as to brokers qualified to achieve "best
execution," including brokers who specialize in any
foreign securities held by the Fund.
3. The Investment Managers are authorized to allocate
brokerage business to brokers who have provided
brokerage and research services, as such services are
defined in Section 28(e) of the Securities Exchange Act
of 1934 (the "1934 Act"), for a Fund and/or other
accounts, if any, for which the Investment Managers
exercise investment discretion (as defined in Section
3(a)(35) of the 1934 Act) and, as to transactions to
which fixed minimum commission rates are not
applicable, to cause a Fund to pay a commission for
effecting a securities transaction in excess of the
amount another broker would have charged for effecting
that transaction, if the Investment Manager for that
Fund in making the selection in question determines in
good faith that such amount of commission is reasonable
in relation to the value of the brokerage and research
services provided by such broker, viewed in terms of
either that particular transaction or the Investment
Manager's overall responsibilities with respect to that
Fund and the other accounts, if any, as to which it
exercises investment discretion. In reaching such
determination, the Investment Managers are not required
to place or attempt to place a specific dollar value on
the research or execution services of a broker or on
the portion of any commission reflecting either of said
services. In demonstrating that such determinations
were made in good faith, the Investment Managers shall
be prepared to show that all commissions were allocated
and paid for purposes contemplated by the Trust's
brokerage policy; that the research services provide
lawful and appropriate assistance to the Investment
Managers in the performance of their investment
decision-making responsibilities; and that the
<PAGE>
commissions paid were within a reasonable range. The
determination that commissions were within a reasonable
range shall be based on any available information as to
the level of commissions known to be charged by other
brokers on comparable transactions, but there shall be
taken into account the Trust's policies that (i)
obtaining a low commission is deemed secondary to
obtaining a favorable securities price, since it is
recognized that usually it is more beneficial to a Fund
to obtain a favorable price than to pay the lowest
commission; and (ii) the quality, comprehensiveness and
frequency of research studies which are provided for
the Investment Managers are useful to the Investment
Managers in performing their advisory services under
their Investment Management Agreements with the Trust.
Research services provided by brokers to the Investment
Managers are considered to be in addition to, and not
in lieu of, services required to be performed by the
Investment Managers under its Investment Management
Agreements with the Trust. Research furnished by
brokers through whom a Fund effects securities
transactions may be used by the Investment Managers for
any of their accounts, and not all such research may be
used by the Investment Managers for the Funds. When
execution of portfolio transactions is allocated to
brokers trading on exchanges with fixed brokerage
commission rates, account may be taken of various
services provided by the broker, including quotations
outside the United States for daily pricing of foreign
securities held in a Fund's portfolio.
4. Purchases and sales of portfolio securities within the
United States other than on a securities exchange are
executed with primary market makers acting as
principal, except where, in the judgment of a Fund's
Investment Manager, better prices and execution may be
obtained on a commission basis or from other sources.
5. Sales of the Funds' Shares (which shall be deemed to
include also shares of other companies registered under
the 1940 Act which have either the same investment
adviser or an investment adviser affiliated with either
Fund's Investment Manager) made by a broker are one
factor among others to be taken into account in
deciding to allocate portfolio transactions (including
agency transactions, principal transactions, purchases
in underwritings or tenders in response to tender
offers) for the account of a Fund to that broker;
provided that the broker shall furnish "best
execution," as defined in paragraph 1 above, and that
such allocation shall be within the scope of that
Fund's other policies as stated above; and provided
further, that in every allocation made to a broker in
which the sale of Shares is taken into account there
<PAGE>
shall be no increase in the amount of the commissions
or other compensation paid to such broker beyond a
reasonable commission or other compensation determined,
as set forth in paragraph 3 above, on the basis of best
execution alone or best execution plus research
services, without taking account of or placing any
value upon such sale of Shares.
Insofar as known to management, no Trustee or officer of the
Trust, nor the Investment Managers or Principal Underwriter or
any person affiliated with either of them, has any material
direct or indirect interest in any broker employed by or on
behalf of the Trust. Franklin Templeton Distributors, Inc., the
Trust's Principal Underwriter, is a registered broker-dealer, but
it does not intend to execute any purchase or sale transactions
for the Funds' portfolios or to participate in any commissions on
any such transactions. The total brokerage commissions on the
portfolio transactions for Rising Dividends Fund and
Infrastructure Fund during the year ended March 31, 1995 (not
including any spreads or concessions on principal transactions)
were $___________ and $________________, respectively. The total
brokerage commissions on the portfolio transactions for Americas
Government Securities Fund during the period from June 27, 1994
(commencement of operations) through March 31, 1995 (not
including any spreads or concessions on principal transactions)
were $________________.
All portfolio transactions are allocated to broker-dealers
only when their prices and execution, in the judgment of the
Investment Managers, are equal to the best available within the
scope of the Trust's policies. There is no fixed method used in
determining which broker-dealers receive which order or how many
orders.
PURCHASE, REDEMPTION AND PRICING OF SHARES
Each Fund's Prospectus describes the manner in which a
Fund's Shares may be purchased and redeemed. See "How to Buy
Shares of the Fund" and "How to Sell Shares of the Fund."
Net asset value per Share is calculated separately for each
Fund. Net asset value per Share is determined as of the close of
business on the New York Stock Exchange, which currently is
4:00 p.m. (Eastern time) every Monday through Friday (exclusive
of national business holidays). The Trust's offices will be
closed, and net asset value will not be calculated, on those days
on which the New York Stock Exchange is closed, which currently
are: New Year's Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
Trading in securities on European and Far Eastern securities
exchanges and over-the-counter markets is normally completed well
before the close of business in New York on each day on which the
New York Stock Exchange is open. Trading of European or Far
<PAGE>
Eastern securities generally, or in a particular country or
countries, may not take place on every New York business day.
Furthermore, trading takes place in various foreign markets on
days which are not business days in New York and on which each
Fund's net asset value is not calculated. Each Fund calculates
net asset value per Share, and therefore effects sales,
redemptions and repurchases of its Shares, as of the close of the
New York Stock Exchange once on each day on which that Exchange
is open. Such calculation does not take place contemporaneously
with the determination of the prices of many of the portfolio
securities used in such calculation and if events occur which
materially affect the value of those foreign securities, they
will be valued at fair market value as determined by the
management and approved in good faith by the Board of Trustees.
The Board of Trustees may establish procedures under which a
Fund may suspend the determination of net asset value for the
whole or any part of any period during which (1) the New York
Stock Exchange is closed other than for customary weekend and
holiday closings, (2) trading on the New York Stock Exchange is
restricted, (3) an emergency exists as a result of which disposal
of securities owned by a Fund is not reasonably practicable or it
is not reasonably practicable for a Fund fairly to determine the
value of its net assets, or (4) for such other period as the
Securities and Exchange Commission may by order permit for the
protection of the holders of a Fund's Shares.
Ownership and Authority Disputes. In the event of disputes
involving multiple claims of ownership or authority to control a
shareholder's account, each Fund has the right (but has no
obligation) to: (a) freeze the account and require the written
agreement of all persons deemed by the Fund to have a potential
property interest in the account, prior to executing instructions
regarding the account; or (b) interplead disputed funds or
accounts with a court of competent jurisdiction. Moreover, the
Fund may surrender ownership of all or a portion of the account
to the Internal Revenue Service in response to a Notice of Levy.
In addition to the special purchase plans described in the
Prospectus, the following special purchase plans also are
available:
Tax Deferred Retirement Plans. The Trust offers its
Shareholders the opportunity to participate in the following
types of retirement plans:
For individuals whether or not covered by other
qualified plans;
For simplified employee pensions;
For employees of tax-exempt organizations; and
<PAGE>
For corporations, self-employed individuals and
partnerships.
Capital gains and income received by the foregoing plans
generally are exempt from taxation until distribution from the
plans. Investors considering participation in any such plan
should review specific tax laws relating thereto and should
consult their attorneys or tax advisers with respect to the
establishment and maintenance of any such plan. Additional
information, including the fees and charges with respect to all
of these plans, is available upon request to the Principal
Underwriter. No distribution under a retirement plan will be
made until Templeton Funds Trust Company receives the
participant's election on Internal Revenue Service Form W-4P
(available on request from Templeton Funds Trust Company, and
such other documentation as it deems necessary, as to whether or
not U.S. income tax is to be withheld from such distribution.
Individual Retirement Account (IRA). All individuals
(whether or not covered by qualified private or governmental
retirement plans) may purchase Shares of a Fund pursuant to an
Individual Retirement Account. However, contributions to an IRA
by an individual who is covered by a qualified private or
governmental plan may not be tax-deductible depending on the
individual's income. Custodial services for Individual
Retirement Accounts are available through Templeton Funds Trust
Company. Disclosure statements summarizing certain aspects of
Individual Retirement Accounts are furnished to all persons
investing in such accounts, in accordance with Internal Revenue
Service regulations.
Simplified Employee Pensions (SEP-IRA). For employers who
wish to establish a simplified form of employee retirement
program investing in Shares of a Fund, there are available
Simplified Employee Pensions invested in IRA Plans. Details and
materials relating to these plans will be furnished upon request
to the Principal Underwriter.
Retirement Plan for Employees of Tax-Exempt Organizations
(403(b)). Employees of public school systems and certain types
of charitable organizations may enter into a deferred
compensation arrangement for the purchase of Shares of a Fund
without being taxed currently on the investment. Contributions
which are made by the employer through salary reduction are
excludable from the gross income of the employee. Such deferred
compensation plans, which are intended to qualify under Section
403(b) of the Internal Revenue Code, are available through the
Principal Underwriter. Custodial services are provided by
Templeton Funds Trust Company.
Qualified Plan for Corporations, Self-Employed Individuals
and Partnerships. For employers who wish to purchase Shares of a
Fund in conjunction with employee retirement plans, there is a
prototype master plan which has been approved by the Internal
<PAGE>
Revenue Service. A "Section 401(k) plan" is also available.
Templeton Funds Trust Company furnishes custodial services for
these plans. For further details, including custodian fees and
plan administration services, see the master plan and related
material which is available from the Principal Underwriter.
Letter of Intent. Purchasers who intend to invest $50,000
or more in Class I Shares of Global Rising Dividends Fund, Global
Infrastructure Fund, Greater European Fund, or Latin America Fund
($100,000 or more in Shares of Americas Government Securities
Fund) or any other fund in the Franklin Templeton Group within 13
months (whether in one lump sum or in installments the first of
which may not be less than 5% of the total intended amount and
each subsequent installment not less than $25, including
automatic investment and payroll deduction plans), and to
beneficially hold the total amount of such Class I Shares fully
paid for and outstanding simultaneously for at least one full
business day before the expiration of that period, should execute
a Letter of Intent ("LOI") on the form provided in the
Shareholder Application in the Funds' Prospectuses. Payment for
not less than 5% of the total intended amount must accompany the
executed LOI. Those Class I Shares purchased with the first 5%
of the intended amount stated in the LOI will be held as
"Escrowed Shares" for as long as the LOI remains unfulfilled.
Although the Escrowed Shares are registered in the investor's
name, his full ownership of them is conditional upon fulfillment
of the LOI. No Escrowed Shares can be redeemed by the investor
for any purpose until the LOI is fulfilled or terminated. If the
LOI is terminated for any reason other than fulfillment, the
Transfer Agent will redeem that portion of the Escrowed Shares
required and apply the proceeds to pay any adjustment that may be
appropriate to the sales commission on all Class I Shares
(including the Escrowed Shares) already purchased under the LOI
and apply any unused balance to the investor's account. The LOI
is not a binding obligation to purchase any amount of Shares, but
its execution will result in the purchaser paying a lower sales
charge at the appropriate quantity purchase level. A purchase
not originally made pursuant to an LOI may be included under a
subsequent LOI executed within 90 days of such purchase. In this
case, an adjustment will be made at the end of 13 months from the
effective date of the LOI at the net asset value per Share then
in effect, unless the investor makes an earlier written request
to the Principal Underwriter upon fulfilling the purchase of
Shares under the LOI. In addition, the aggregate value of any
Shares purchased prior to the 90-day period referred to above may
be applied to purchases under a current LOI in fulfilling the
total intended purchases under the LOI. However, no adjustment
of sales charges previously paid on purchases prior to the 90-
day period will be made.
TAX STATUS
The following discussion summarizes certain U.S. Federal tax
considerations incident to an investment in a Fund.
<PAGE>
Each Fund intends to quality as a regulated investment
company under the Internal Revenue Code of 1986, as amended (the
"Code"). To so qualify, each Fund must, among other things: (a)
derive at least 90% of its gross income from dividends, interest,
payments with respect to securities loans, gains from the sale or
other disposition of stock or securities and gains from the sale
or other disposition of foreign currencies, or other income
(including gains from options, futures contracts and forward
contracts) derived with respect to the Fund's business of
investing in stocks, securities or currencies; (b) derive less
than 30% of its gross income from the sale or other disposition
of the following assets held for less than three months: (i)
stock and securities, (ii) options, futures and forward contracts
(other than options, futures and forward contracts on foreign
currencies), and (iii) foreign currencies (and options, futures
and forward contracts on foreign currencies) which are not
directly related to the Fund's principal business of investing in
stocks and securities (or options and futures with respect to
stock or securities); (c) diversify its holdings so that, at the
end of each quarter, (i) at least 50% of the value of the Fund's
total assets is represented by cash and cash items, U.S.
Government securities, securities of other regulated investment
companies, and other securities, with such other securities
limited in respect of any one issuer to an amount not greater in
value than 5% of the Fund's total assets and to not more than 10%
of the outstanding voting securities of such issuer, and (ii) not
more than 25% of the value of the Fund's total assets is invested
in the securities (other than U.S. Government securities or
securities of other regulated investment companies) of any one
issuer or of any two or more issuers that the Fund controls and
that are determined to be engaged in the same business or similar
or related businesses; and (d) distribute at least 90% of its
investment company taxable income (which includes, among other
items, dividends, interest and net short-term capital gains in
excess of net long-term capital losses) each taxable year.
The Treasury Department is authorized to issue regulations
providing that foreign currency gains that are not directly
related to a Fund's principal business of investing in stock or
securities (or options and futures with respect to stock or
securities) will be excluded from the income which qualifies for
purposes of the 90% gross income requirement described above. To
date, however, no regulations have been issued.
The status of the Funds as regulated investment companies
does not involve government supervision of management or of their
investment practices or policies. As a regulated investment
company, a Fund generally will be relieved of liability for U.S.
Federal income tax on that portion of its net investment income
and net realized capital gains which it distributes to its
Shareholders. Amounts not distributed on a timely basis in
accordance with a calendar year distribution requirement also are
subject to a nondeductible 4% excise tax. To prevent application
<PAGE>
of the excise tax, each Fund intends to make distributions in
accordance with the calendar year distribution requirement.
Dividends of net investment income and net short-term
capital gains are taxable to Shareholders as ordinary income.
Distributions of net investment income may be eligible for the
corporate dividends-received deduction to the extent attributable
to a Fund's qualifying dividend income. However, the alternative
minimum tax applicable to corporations may reduce the benefit of
the dividends-received deduction. Distributions of net capital
gains (the excess of net long-term capital gains over net short-
term capital losses) designated by a Fund as capital gain
dividends are taxable to Shareholders as long-term capital gains,
regardless of the length of time the Fund's Shares have been held
by a Shareholder, and are not eligible for the dividends-received
deduction. All dividends and distributions are taxable to
Shareholders, whether or not reinvested in Shares of a Fund.
Shareholders will be notified annually as to the Federal tax
status of dividends and distributions they receive and any tax
withheld thereon.
Distributions by a Fund reduce the net asset value of the
Fund Shares. Should a distribution reduce the net asset value
below a Shareholder's cost basis, the distribution nevertheless
would be taxable to the Shareholder as ordinary income or capital
gain as described above, even though, from an investment
standpoint, it may constitute a partial return of capital. In
particular, investors should be careful to consider the tax
implication of buying Shares just prior to a distribution by a
Fund. The price of Shares purchased at that time includes the
amount of the forthcoming distribution, but the distribution will
generally be taxable to them.
Certain of the debt securities acquired by the Funds may be
treated as debt securities that were originally issued at a
discount. Original issue discount can generally be defined as
the difference between the price at which a security was issued
and its stated redemption price at maturity. Although no cash
income is actually received by the Funds, original issue discount
that accrues on a debt security in a given year generally is
treated for Federal income tax purposes as interest and,
therefore, such income would be subject to the distribution
requirements of the Code.
Some of the debt securities may be purchased by the Funds at
a discount which exceeds the original issue discount on such debt
securities, if any. This additional discount represents market
discount for Federal income tax purposes. The gain realized on
the disposition of any taxable debt security having market
discount generally will be treated as ordinary income to the
extent it does not exceed the accrued market discount on such
debt security. Generally, market discount accrues on a daily
basis for each day the debt security is held by a Fund at a
constant rate over the time remaining to the debt security's
<PAGE>
maturity or, at the election of a Fund, at a constant yield to
maturity which takes into account the semi-annual compounding of
interest.
A Fund may invest in debt securities issued in bearer form.
Special rules applicable to bearer debt may in some cases result
in (i) treatment of gain realized with respect to such a debt
security as ordinary income and (ii) disallowance of deductions
for losses realized on dispositions of such debt securities. If
these special rules apply, the amount that must be distributed to
Fund shareholders may be increased as compared to a fund that did
not invest in debt securities issued in bearer form.
A Fund may invest in stocks of foreign companies that are
classified under the Code as passive foreign investment companies
("PFICs"). In general, a foreign company is classified as a PFIC
if at least one-half of its assets constitute investment-type
assets or 75% or more of its gross income is investment-type
income. Under the PFIC rules, an "excess distribution" received
with respect to PFIC stock is treated as having been realized
ratably over the period during which a Fund held the PFIC stock.
A Fund itself will be subject to tax on the portion, if any, of
the excess distribution that is allocated to that Fund's holding
period in prior taxable years (and an interest factor will be
added to the tax, as if the tax had actually been payable in such
prior taxable years) even though the Fund distributes the
corresponding income to Shareholders. Excess distributions
include any gain from the sale of PFIC stock as well as certain
distributions from a PFIC. All excess distributions are taxable
as ordinary income.
A Fund may be able to elect alternative tax treatment with
respect to PFIC stock. Under an election that currently may be
available, a Fund generally would be required to include in its
gross income its share of the earnings of a PFIC on a current
basis, regardless of whether any distributions are received from
the PFIC. If this election is made, the special rules, discussed
above, relating to the taxation of excess distributions, would
not apply. In addition, another election may be available that
would involve marking to market the Funds' PFIC shares at the end
of each taxable year (and on certain other dates prescribed in
the Code), with the result that unrealized gains are treated as
though they were realized. If this election were made, tax at
the Fund level under the PFIC rules would generally be
eliminated, but the Funds could, in limited circumstances, incur
nondeductible interest charges. Each Fund's intention to qualify
annually as a regulated investment company may limit its
elections with respect to PFIC shares.
Because the application of the PFIC rules may affect, among
other things, the character of gains, the amount of gain or loss
and the timing of the recognition of income with respect to PFIC
stock, as well as subject a Fund itself to tax on certain income
from PFIC stock, the amount that must be distributed to Share-
<PAGE>
holders, and which will be taxed to Shareholders as ordinary
income or long-term capital gain, may be increased or decreased
substantially as compared to a fund that did not invest in PFIC
stock.
Income received by a Fund from sources within foreign
countries may be subject to withholding and other income or
similar taxes imposed by such countries. If more than 50% of the
value of a Fund's total assets at the close of its taxable year
consists of securities of foreign corporations, that Fund will be
eligible and intends to elect to "pass through" to the Fund's
Shareholders the amount of foreign taxes paid by that Fund.
Pursuant to this election, a Shareholder will be required to
include in gross income (in addition to taxable dividends
actually received) his pro rata share of the foreign taxes paid
by a Fund, and will be entitled either to deduct (as an itemized
deduction) his pro rata share of foreign income and similar taxes
in computing his taxable income or to use it as a foreign tax
credit against his U.S. Federal income tax liability, subject to
limitations. No deduction for foreign taxes may be claimed by a
Shareholder who does not itemize deductions, but such a
Shareholder may be eligible to claim the foreign tax credit (see
below). Each Shareholder will be notified within 60 days after
the close of the relevant Fund's taxable year whether the foreign
taxes paid by the Fund will "pass through" for that year.
Generally, a credit for foreign taxes is subject to the
limitation that it may not exceed the Shareholder's U.S. tax
attributable to his foreign source taxable income. For this
purpose, if the pass-through election is made, the source of a
Fund's income flows through to its Shareholders. With respect to
a Fund, gains from the sale of securities will be treated as
derived from U.S. sources and certain currency fluctuation gains,
including fluctuation gains from foreign currency denominated
debt securities, receivables and payables, will be treated as
ordinary income derived from U.S. sources. The limitation on the
foreign tax credit is applied separately to foreign source
passive income (as defined for purposes of the foreign tax
credit), including the foreign source passive income passed
through by a Fund. Shareholders may be unable to claim a credit
for the full amount of their proportionate share of the foreign
taxes paid by a Fund. Foreign taxes may not be deducted in
computing alternative minimum taxable income and the foreign tax
credit can be used to offset only 90% of the alternative minimum
tax (as computed under the Code for purposes of this limitation)
imposed on corporations and individuals. If a Fund is not
eligible to make the election to "pass through" to its
Shareholders its foreign taxes, the foreign income taxes it pays
generally will reduce investment company taxable income and the
distributions by a Fund will be treated as United States source
income.
Certain options, futures, and foreign currency forward
contracts in which the Funds may invest are "section 1256
<PAGE>
contracts." Gains or losses on section 1256 contracts generally
are considered 60% long-term and 40% short-term capital gains or
losses ("60/40"); however, foreign currency gains or losses (as
discussed below) arising from certain section 1256 contracts may
be treated as ordinary income or loss. Also, section 1256
contracts held by a Fund at the end of each taxable year (and on
certain other dates as prescribed under the Code) are "marked-
to-market" with the result that unrealized gains or losses are
treated as though they were realized.
Generally, the hedging transactions undertaken by a Fund may
result in "straddles" for U.S. Federal income tax purposes. The
straddle rules may affect the character of gains (or losses)
realized by a Fund. In addition, losses realized by a Fund on
positions that are part of the straddle may be deferred under the
straddle rules, rather than being taken into account in
calculating the taxable income for the taxable year in which the
losses are realized. Because only a few regulations implementing
the straddle rules have been promulgated, the tax consequences to
a Fund of hedging transactions are not entirely clear. The
hedging transactions may increase the amount of short-term
capital gain realized by a Fund which is taxed as ordinary income
when distributed to Shareholders.
A Fund may make one or more of the elections available under
the Code which are applicable to straddles. If a Fund makes any
of the elections, the amount, character, and timing of the
recognition of gains or losses from the affected straddle
positions will be determined under rules that vary according to
the election(s) made. The rules applicable under certain of the
elections may operate to accelerate the recognition of gains or
losses from the affected straddle positions.
Because application of the straddle rules may affect the
character of gains or losses, defer losses and/or accelerate the
recognition of gains or losses from the affected straddle
positions, the amount which must be distributed to Shareholders
and which will be taxed to Shareholders as ordinary income or
long-term capital gain may be increased or decreased as compared
to a fund that did not engage in such hedging transactions.
Requirements relating to each Fund's tax status as a
regulated investment company may limit the extent to which a Fund
will be able to engage in transactions in options, futures, and
foreign currency forward contracts.
Under the Code, gains or losses attributable to fluctuations
in foreign currency exchange rates which occur between the time a
Fund accrues income or other receivables or accrues expenses or
other liabilities denominated in a foreign currency and the time
a Fund actually collects such receivables or pays such
liabilities generally are treated as ordinary income or ordinary
loss. Similarly, on disposition of debt securities denominated
in a foreign currency and on disposition of certain futures
<PAGE>
contracts and options, gains or losses attributable to
fluctuations in the value of foreign currency between the date of
acquisition of the security or contract and the date of
disposition also are treated as ordinary gain or loss. These
gains and losses, referred to under the Code as "section 988"
gains and losses, may increase or decrease the amount of a Fund's
net investment income to be distributed to its Shareholders as
ordinary income. For example, fluctuations in exchange rates may
increase the amount of income that a Fund must distribute in
order to qualify for treatment as a regulated investment company
and to prevent application of an excise tax on undistributed
income. Alternatively, fluctuations in exchange rates may
decrease or eliminate income available for distribution. If
section 988 losses exceed other net investment income during a
taxable year, a Fund would not be able to make ordinary dividend
distributions, or distributions made before the losses were
realized would be recharacterized as return of capital to
Shareholders for Federal income tax purposes, rather than as an
ordinary dividend, reducing each Shareholder's basis in his Fund
Shares.
Upon the sale or exchange of his Shares, a Shareholder will
realize a taxable gain or loss depending upon his basis in the
Shares. Such gain or loss will be treated as capital gain or
loss if the Shares are capital assets in the Shareholder's hands,
and generally will be long-term if the Shareholder's holding
period for the Shares is more than one year and generally
otherwise will be short-term. Any loss realized on a sale or
exchange will be disallowed to the extent that the Shares
disposed of are replaced (including replacement through the
reinvesting of dividends and capital gain distributions in a
Fund) within a period of 61 days beginning 30 days before and
ending 30 days after the disposition of the Shares. In such a
case, the basis of the Shares acquired will be adjusted to
reflect the disallowed loss. Any loss realized by a Shareholder
on the sale of a Fund's Shares held by the Shareholder for six
months or less will be treated for Federal income tax purposes as
a long-term capital loss to the extent of any distributions of
long-term capital gains received by the Shareholder with respect
to such Shares.
In some cases, Shareholders will not be permitted to take
sales charges into account for purposes of determining the amount
of gain or loss realized on the disposition of their Shares.
This prohibition generally applies where (1) the Shareholder
incurs a sales charge in acquiring the stock of a regulated
investment company, (2) the stock is disposed of before the 91st
day after the date on which it was acquired, and (3) the
Shareholder subsequently acquires shares of the same or another
regulated investment company and the otherwise applicable sales
charge is reduced or eliminated under a "reinvestment right"
received upon the initial purchase of shares of stock. In that
case, the gain or loss recognized will be determined by excluding
from the tax basis of the Shares exchanged all or a portion of
<PAGE>
the sales charge incurred in acquiring those Shares. This
exclusion applies to the extent that the otherwise applicable
sales charge with respect to the newly acquired Shares is reduced
as a result of having incurred a sales charge initially. Sales
charges affected by this rule are treated as if they were
incurred with respect to the stock acquired under the
reinvestment right. This provision may be applied to successive
acquisitions of stock.
Each Fund generally will be required to withhold Federal
income tax at a rate of 31% ("backup withholding") from dividends
paid, capital gain distributions, and redemption proceeds to
Shareholders if (1) the Shareholder fails to furnish a Fund with
the Shareholder's correct taxpayer identification number or
social security number and to make such certifications as a Fund
may require, (2) the Internal Revenue Service notifies the
Shareholder or a Fund that the Shareholder has failed to report
properly certain interest and dividend income to the Internal
Revenue Service and to respond to notices to that effect, or (3)
when required to do so, the Shareholder fails to certify that he
is not subject to backup withholding. Any amounts withheld may
be credited against the Shareholder's Federal income tax
liability.
Ordinary dividends and taxable capital gain distributions
declared in October, November, or December with a record date in
such month and paid during the following January will be treated
as having been paid by a Fund and received by Shareholders on
December 31 of the calendar year in which declared, rather than
the calendar year in which the dividends are actually received.
Distributions also may be subject to state, local and
foreign taxes. U.S. tax rules applicable to foreign investors
may differ significantly from those outlined above. This
discussion does not purport to deal with all of the tax
consequences applicable to Shareholders. Shareholders are
advised to consult their own tax advisers for details with
respect to the particular tax consequences to them of an
investment in a Fund.
PRINCIPAL UNDERWRITER
Franklin Templeton Distributors, Inc. ("FTD" or the
"Principal Underwriter"), 700 Central Avenue, P.O. Box 33030, St.
Petersburg, Florida 33733-8030, toll free telephone (800) 237-
0738, is the Principal Underwriter of each Fund's Shares. FTD is
a wholly owned subsidiary of Franklin.
Each Fund, pursuant to Rule 12b-1 under the 1940 Act, has
adopted Distribution Plans (the "Plans"). Under the Plans
adopted with respect to Class I Shares (including all shares
issued by Americas Government Securities Fund), each Fund may
reimburse FTD monthly (subject to a limit of 0.35% per annum of
each Fund's average daily net assets attributable to Class I
<PAGE>
Shares) for FTD's costs and expenses in connection with any
activity which is primarily intended to result in the sale of the
Funds' Shares. Rising Dividends Fund, Infrastructure Fund,
Greater European Fund and Latin America Fund also have a second
class of Shares, designated Class II Shares. Under the Plans
adopted with respect to Class II Shares, each Fund may reimburse
FTD monthly (subject to a limit of 1.00% per annum of each Fund's
average daily assets attributable to Class II Shares of which up
to 0.25% of such net assets may be paid to dealers for personal
service and/or maintenance of Shareholder accounts) for FTD's
costs and expenses in connection with any activity which is
primarily intended to result in the sale of the Funds' Shares.
Payments to FTD could be for various types of activities,
including (1) payments to broker-dealers who provide certain
services of value to each Fund's Shareholders (sometimes referred
to as a "trail fee"); (2) reimbursement of expenses relating to
selling and servicing efforts or of organizing and conducting
sales seminars; (3) payments to employees or agents of the
Principal Underwriter who engage in or support distribution of
Shares; (4) payments of the costs of preparing, printing and
distributing Prospectuses and reports to prospective investors
and of printing and advertising expenses; (5) payment of dealer
commissions and wholesaler compensation in connection with sales
of the Funds' Shares exceeding $1 million (on which the Funds
impose no initial sales charge) and interest or carrying charges
in connection therewith; and (6) such other similar services as
the Trust's Board of Trustees determines to be reasonably
calculated to result in the sale of Shares. Under the Plans, the
costs and expenses not reimbursed in any one given month
(including costs and expenses not reimbursed because they exceed
the percentage limit applicable to either class of Shares) may be
reimbursed in subsequent months or years.
During the fiscal year ended March 31, 1995, FTD incurred
costs and expenses (including advanced commissions) of $_________
in connection with distribution of Rising Dividends Fund's Class
I Shares, and $_______ in connection with the distribution of
Infrastructure Fund's Class I Shares, which amounts were
reimbursed by the Funds pursuant to the Plans (Class II Shares
were not offered during this period). During the period from
June 27, 1994 (commencement of operations) through March 31,
1995, FTD incurred costs and expenses (including advanced
commissions) of $______ in connection with distribution of
Americas Government Securities Fund's Class I Shares (Class II
Shares were not offered during this period), which amounts were
reimbursed by the Fund pursuant to the Plan. FTD has informed
the Funds that it had no unreimbursed expenses under the Plans at
March 31, 1995. In the event that any Plan is terminated, the
Trust will not be liable to FTD for any unreimbursed expenses
that have been carried forward from previous months or years.
During the fiscal year ended March 31, 1995, FTD spent, with
respect to Rising Dividends Fund, the following amounts on:
compensation to dealers $______; sales promotion $______; sales
materials $______; printing $______; advertising $______; and
<PAGE>
wholesaler commissions $______; and with respect to
Infrastructure Fund, the following amounts on: compensation to
dealers $______; sales promotion $______; sales materials
$______; printing $______; advertising $______; and wholesaler
commissions $______. During the period from June 27, 1994
(commencement of operations) through March 31, 1995, FTD spent,
with respect to Americas Government Securities Fund, the
following amounts on: compensation to dealers $______; sales
promotion $______; sales materials $______; printing $______;
advertising $______; and wholesaler commissions $______.
The Underwriting Agreement provides that the Principal
Underwriter will use its best efforts to maintain a broad and
continuous distribution of each Fund's Shares among bona fide
investors and may sign selling agreements with responsible
dealers, as well as sell to individual investors. The Shares are
sold only at the Offering Price in effect at the time of sale,
and each Fund receives not less than the full net asset value of
the Shares sold. The discount between the Offering Price and the
net asset value of a Fund's Shares may be retained by the
Principal Underwriter or it may reallow all or any part of such
discount to dealers. The Principal Underwriter in all cases buys
Shares from a Fund acting as principal for its own account.
Dealers generally act as principal for their own account in
buying Shares from the Principal Underwriter. No agency
relationship exists between any dealer and a Fund or the
Principal Underwriter.
The Underwriting Agreement provides that each Fund shall pay
the costs and expenses incident to registering and qualifying its
Shares for sale under the Securities Act of 1933 and under the
applicable blue sky laws of the jurisdictions in which the
Principal Underwriter desires to distribute such Shares, and for
preparing, printing and distributing Prospectuses and reports to
Shareholders. The Principal Underwriter pays the cost of
printing additional copies of Prospectuses and reports to
Shareholders used for selling purposes. (The Funds pay costs of
preparation, set-up and initial supply of their Prospectuses for
existing Shareholders.)
The Underwriting Agreement is subject to renewal from year
to year in accordance with the provisions of the 1940 Act and
terminates automatically in the event of its assignment. The
Underwriting Agreement may be terminated without penalty by
either party upon 60 days' written notice to the other, provided
termination by the Trust shall be approved by the Board of
Trustees or a majority (as defined in the 1940 Act) of the
Shareholders. The Principal Underwriter is relieved of liability
for any act or omission in the course of its performance of the
Underwriting Agreement, in the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of its
obligations.
<PAGE>
FTD is the principal underwriter for the other Templeton
Funds.
DESCRIPTION OF SHARES
The Shares of each Fund have the same preferences,
conversion and other rights, voting powers, restrictions and
limitations as to dividends, qualifications and terms and
conditions of redemption, except as follows: all consideration
received from the sale of Shares of a Fund, together with all
income, earnings, profits and proceeds thereof, belongs to that
Fund and is charged with liabilities in respect to that Fund and
of that Fund's part of general liabilities of the Trust in the
proportion that the total net assets of the Fund bear to the
total net assets of both Funds. The net asset value of a Share
of a Fund is based on the assets belonging to that Fund less the
liabilities charged to that Fund, and dividends are paid on
Shares of a Fund only out of lawfully available assets belonging
to that Fund. In the event of liquidation or dissolution of the
Trust, the Shareholders of each Fund will be entitled, out of
assets of the Trust available for distribution, to the assets
belonging to that particular Fund.
The Trust Instrument provides that the holders of not less
than two-thirds of the outstanding Shares of the Funds may remove
a person serving as Trustee either by declaration in writing or
at a meeting called for such purpose. The Trustees are required
to call a meeting for the purpose of considering the removal of a
person serving as Trustee if requested in writing to do so by the
holders of not less than 10% of the outstanding Shares of the
Trust.
The Shares have non-cumulative voting rights so that the
holders of a plurality of the Shares voting for the election of
Trustees at a meeting at which 50% of the outstanding Shares are
present can elect all the Trustees and in such event, the holders
of the remaining Shares voting for the election of Trustees will
not be able to elect any person or persons to the Board of
Trustees.
PERFORMANCE INFORMATION
The Funds may, from time to time, include their total return
in advertisements or reports to Shareholders or prospective
investors. Quotations of average annual total return for the
Funds will be expressed in terms of the average annual compounded
rate of return for periods in excess of one year or the total
return for periods less than one year of a hypothetical
investment in the Funds over periods of one, five, or ten years
(up to the life of a Fund) calculated pursuant to the following
formula: P(1 + T)n = ERV (where P = a hypothetical initial
payment of $1,000, T = the average annual total return for
periods of one year or more or the total return for periods of
less than one year, n = the number of years, and ERV = the ending
<PAGE>
redeemable value of a hypothetical $1,000 payment made at the
beginning of the period). All total return figures reflect the
deduction of the maximum initial sales charge and deduction of a
proportional share of Fund expenses on an annual basis, and
assume that all dividends and distributions are reinvested when
paid. The average annual total return for the one-year period
ended March 31, 1995 was _____% for Rising Dividends Fund and
____% for Infrastructure Fund. The total return for the period
from June 27, 1994 (commencement of operations) through March 31,
1995, on an annualized basis, was ____% for Americas Government
Securities Fund.
Performance information for either Fund may be compared, in
reports and promotional literature, to: (i) unmanaged indices so
that investors may compare the Fund's results with those of a
group of unmanaged securities widely regarded by investors as
representative of the securities market in general; (ii) other
groups of mutual funds tracked by Lipper Analytical Services,
Inc., a widely used independent research firm which ranks mutual
funds by overall performance, investment objectives and assets,
or tracked by other services, companies, publications, or persons
who rank mutual funds on overall performance or other criteria;
and (iii) the Consumer Price Index (measure for inflation) to
assess the real rate of return from an investment in a Fund.
Unmanaged indices may assume the reinvestment of dividends but
generally do not reflect deductions for administrative and
management costs and expenses.
Performance information for a Fund reflects only the
performance of a hypothetical investment in a Fund during the
particular time period on which the calculations are based.
Performance information should be considered in light of a Fund's
investment objective and policies, characteristics and quality of
the portfolio and the market conditions during the given time
period, and should not be considered as a representation of what
may be achieved in the future.
From time to time, each Fund and its Investment Manager may
also refer to the following information:
(1) The Investment Manager's and its affiliates' market share of
international equities managed in mutual funds prepared or
published by Strategic Insight or a similar statistical
organization.
(2) The performance of U.S. equity and debt markets relative to
foreign markets prepared or published by Morgan Stanley
Capital International or a similar financial organization.
(3) The capitalization of U.S. and foreign stock markets as
prepared or published by the International Finance Corp.,
Morgan Stanley Capital International or a similar financial
organization.
<PAGE>
(4) The geographic distribution of the Fund's portfolio.
(5) The gross national product and populations, including age
characteristics, of various countries as published by
various statistical organizations.
(6) To assist investors in understanding the different returns
and risk characteristics of various investments, the Fund
may show historical returns of various investments and
published indices (e.g., Ibbotson Associates, Inc. Charts
and Morgan Stanley EAFE - Index).
(7) The major industries located in various jurisdictions as
published by the Morgan Stanley Index.
(8) Rankings by DALBAR Surveys, Inc. with respect to mutual fund
shareholder services.
(9) Allegorical stories illustrating the importance of
persistent long-term investing.
(10) The Fund's portfolio turnover rate and its ranking relative
to industry standards as published by Lipper Analytical
Services, Inc. or Morningstar, Inc.
(11) A description of the Templeton organization's investment
management philosophy and approach, including its worldwide
search for undervalued or "bargain" securities and its
diversification by industry, nation and type of stocks or
other securities.
(12) Quotations from the Templeton organization's founder, Sir
John Templeton*, advocating the virtues of diversification
and long-term investing, including the following:
"Never follow the crowd. Superior performance is
possible only if you invest differently from the
crowd."
"Diversify by company. By industry and by country."
"Always maintain a long-term perspective."
"Invest for maximum total real return."
"Invest - don't trade or speculate."
"Remain flexible and open-minded about types of
investment."
* Sir John Templeton, who currently serves as Chairman of
the Trust's Board, is not involved in investment decisions, which
are made by each Fund's Investment Manager.
<PAGE>
"Buy low."
"When buying stocks, search for bargains among quality
stocks."
"Buy value, not market trends or the economic outlook."
"Diversify. In stocks and bonds, as in much else,
there is safety in numbers."
"Do your homework or hire wise experts to help you."
"Aggressively monitor your investments."
"Don't panic."
"Learn from your mistakes."
"Outperforming the market is a difficult task."
"An investor who has all the answers doesn't even
understand all the questions."
"There's no free lunch."
"And now the last principle: Do not be fearful or
negative too often."
In addition, each Fund and the Investment Managers may also
refer to the number of shareholders in the Fund or the aggregate
number of shareholders in the Franklin Templeton Group or the
dollar amount of fund and private account assets under management
in advertising materials.
FINANCIAL STATEMENTS
The financial statements contained in the Semi-Annual Report
to Shareholders of Global Rising Dividends Fund, Global
Infrastructure Fund, and Americas Government Securities Fund,
dated September 30, 1994, are incorporated herein by reference.
In addition, attached hereto are a statement of assets and
liabilities dated March 11, 1994 for Global Rising Dividends Fund
and Global Infrastructure Fund and an independent auditor's
report with respect thereto.
<PAGE>
MCGLADREY & PULLEN
Certified Public Accountants and Consultants
INDEPENDENT AUDITOR'S REPORT
To the Trustees and Shareholder
Templeton Global Investment Trust
We have audited the accompanying statements of assets and
liabilities of Templeton Global Rising Dividends Fund and
Templeton Global Infrastructure Fund, series of Templeton Global
Investment Trust as of March 11, 1994. These financial
statements are the responsibility of the Funds' management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we
plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position
of Templeton Global Rising Dividends Fund and Templeton Global
Infrastructure Fund, series of Templeton Global Investment Trust
as of March 11, 1994, in conformity with generally accepted
accounting principles.
MCGLADREY & PULLEN
New York, New York
March 11, 1994
<PAGE>
Templeton Global Investment Trust
Statements of Assets and Liabilities
March 11, 1994
Templeton Templeton
Global Rising Global
Dividends Infrastructure
Fund Fund
ASSETS
Cash $ 100,000 $ 100,000
Deferred organization expenses 70,558 70,558
Total Assets $ 170,558 $ 170,558
LIABILITIES
Payable for organization and
initial registration expenses 70,558 70,558
NET ASSETS
Net assets applicable to 10,000
shares of each series of fund
shares outstanding; an
unlimited number of $0.01 par
value shares of beneficial
interest of each class is
authorized $ 100,000 $ 100,000
Net asset value per share $ 10.00 $ 10.00
Offering price per share
(100/94.25 x $10.00) $ 10.61 $ 10.61
See Notes to Financial Statements.
<PAGE>
Templeton Global Investment Trust
Notes to Financial Statements
1. Templeton Global Rising Dividends Fund and Templeton Global
Infrastructure Fund are series of Templeton Global Investment Trust
(the "Trust"), a Delaware Business Trust organized December 21, 1993.
The Trust is an open-end management investment company which has had
no operations to date other than those relating to organizational
matters and the sale and issuance of 10,000 shares of each series to
Templeton Global Investors, Inc., the Trust's Business Manager.
2. The Investment Management Agreements, Business Management Agreement,
Distribution Agreement, Transfer Agent Agreement and Distribution
Plans are described elsewhere in the Prospectus and Statement of
Additional Information.
3. Organization expenses, aggregating $70,558 for each series of the
Trust, are being deferred and amortized ratably over a five year
period following commencement of operations. During the amortization
period, the proceeds of any redemption of the original shares by any
holder thereof will be reduced by a pro rata portion of any then
unamortized organization expenses based on the ratio of the shares
redeemed to the total initial shares outstanding immediately prior to
the redemption.
<PAGE>
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
Independent Auditor's Report dated March 11,
1994
Statements of Assets and Liabilities of
Templeton Global Rising Dividends Fund and
Templeton Global Infrastructure Fund as of March
11, 1994
Incorporated by Reference from the September 30,
1994 Semi-Annual Reports to Shareholders of
Templeton Global Rising Dividends Fund,
Templeton Global Infrastructure Fund, and
Templeton Americas Government Securities Fund:
Investment Portfolios
Statements of Assets and Liabilities
Statements of Operations
Statements of Changes in Net Assets
Notes to Financial Statements
(b) Exhibits:
(1) Trust Instrument*
(2) Bylaws**
(3) Not applicable
(4)(A) Specimen security - Templeton Global
Rising Dividends Fund**
(B) Specimen security - Templeton Global
Infrastructure Fund**
(C) Specimen security - Templeton Americas
Government Securities Fund****
(D) Specimen security - Templeton Greater
European Fund - to be filed by amendment
(E) Specimen security - Templeton Latin
America Fund - to be filed by amendment
(5)(A) Investment Management Agreement -
Templeton Global Rising Dividends Fund**
(B) Investment Management Agreement -
Templeton Global Infrastructure Fund**
(C) Investment Management Agreement -
Templeton Americas Government Securities
Fund****
(D) Sub-Advisory Agreement - Templeton
Americas Government Securities Fund****
(E) Investment Management Agreement -
Templeton Greater European Fund
(F) Investment Management Agreement -
Templeton Latin America Fund
(6)(A) Amended and Restated Distribution
Agreement
(B) Dealer Agreement**
(7) Not applicable
(8) Amended and Restated Custody Agreement
(9)(A) Amended and Restated Business Management
Agreement
(B) Amended and Restated Transfer Agent
Agreement
(C) Form of Sub-Transfer Agent Services
Agreement***
(D) Form of Shareholder Sub-Accounting
Services Agreement***
(10) Opinion and consent of counsel filed with
Rule 24f-2 Notice on May 24, 1994.*****
(11) Consent of independent public accountants
(12) Not applicable
(13) Form of Initial Capital Agreement***
(14) Not applicable
(15)(A) Distribution Plan - Templeton Global
Rising Dividends Fund**
(B) Distribution Plan - Templeton Global
Infrastructure Fund**
(C) Distribution Plan - Templeton Americas
Government Securities Fund****
(D)(i) Distribution Plan - Templeton Greater
European Fund Class I
(ii) Distribution Plan - Templeton Greater
European Fund Class II
(E)(i) Distribution Plan - Templeton Latin
America Fund Class I
(ii) Distribution Plan - Templeton Latin
America Fund Class II
(16) Not applicable - Schedule showing
computation of performance quotations
provided in response to Item 22
(unaudited)
(17) Assistant Secretary's Certificate
pursuant to Rule 483(b)****
(18)(A) Semi-Annual Report dated September 30,
1994 for Templeton Global Rising
Dividends Fund*****
(B) Semi-Annual Report dated September 30,
1994 for Templeton Global Infrastructure
Fund*****
(C) Semi-Annual Report dated September 30,
1994 for Templeton Americas Government
Securities Fund*****
____________________
* Filed with the initial Registration Statement on
December 21, 1993.
** Filed with Pre-Effective Amendment No. 1 to the
Registration Statement on March 1, 1994.
*** Filed with Pre-Effective Amendment No. 2 to the
Registration Statement on March 14, 1994.
**** Filed with Post-Effective Amendment No. 1 to the
Registration Statement on April 28, 1994.
***** Filed with Post-Effective Amendment No. 3 to the
Registration Statement on December 2, 1994.
Item 25. Persons Controlled by or Under Common Control with
Registrant
None.
Item 26. Number of Record Holders
Templeton Global Rising Dividends Fund
Shares of Beneficial Interest, par value $0.01 per
share: 660 shareholders as of January 31, 1995.
Templeton Global Infrastructure Fund
Shares of Beneficial Interest, par value $0.01 per
share: 2844 shareholders as of January 31, 1995.
Templeton Americas Government Securities Fund
Shares of Beneficial Interest, par value $0.01 per
share: 35 shareholders as of January 31, 1995.
Item 27. Indemnification
Reference is made to Article X, Section 10.02 of the
Registrant's Trust Instrument, which is filed
herewith.
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to
trustees, officers and controlling persons of the
Registrant by the Registrant pursuant to the Trust
Instrument or otherwise, the Registrant is aware that
in the opinion of the Securities and Exchange
Commission, such indemnification is against public
policy as expressed in the Act and, therefore, is
unenforceable. In the event that a claim for
indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or
paid by trustees, officers or controlling persons of
the Registrant in connection with the successful
defense of any act, suit or proceeding) is asserted
by such trustees, officers or controlling persons in
connection with the shares being registered, the
Registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the
question whether such indemnification by it is
against public policy as expressed in the Act and
will be governed by the final adjudication of such
issues.
Item 28. Business and Other Connections of Investment Advisers
and their Officers and Directors
The business and other connections of Templeton,
Galbraith & Hansberger Ltd. (the investment adviser
of Templeton Global Rising Dividends Fund, Templeton
Greater European Fund, and Templeton Latin America
Fund) and Templeton Investment Counsel, Inc. (the
investment adviser of Templeton Global Infrastructure
Fund and Templeton Americas Government Securities
Fund) are described in Parts A and B.
For information relating to the investment advisers'
officers and directors, reference is made to Forms
ADV filed under the Investment Advisers Act of 1940
by Templeton, Galbraith & Hansberger Ltd. and
Templeton Investment Counsel, Inc.
Item 29. Principal Underwriters
(a) Franklin Templeton Distributors, Inc. also acts
as principal underwriter of shares of Templeton
Growth Fund, Inc., Templeton Funds, Inc.,
Templeton Smaller Companies Growth Fund, Inc.,
Templeton Income Trust, Templeton Real Estate
Securities Fund, Templeton Capital Accumulator
Fund, Inc., Templeton Developing Markets Trust,
Templeton American Trust, Inc., Templeton
Institutional Funds, Inc., Templeton Global
Opportunities Trust, Templeton Variable Products
Series Fund, AGE High Income Fund, Inc.,
Franklin Balance Sheet Investment Fund, Franklin
California Tax Free Income Fund, Inc., Franklin
California Tax Free Trust, Franklin Custodian
Funds, Inc., Franklin Equity Fund, Franklin
Federal Tax-Free Income Fund, Franklin Gold
Fund, Franklin Investors Securities Trust,
Franklin Managed Trust, Franklin Municipal
Securities Trust, Franklin New York Tax-Free
Income Fund, Franklin New York Tax-Free Trust,
Franklin Pennsylvania Investors Fund, Franklin
Premier Return Fund, Franklin Strategic Series,
Franklin Tax-Advantaged High Yield Securities
Fund, Franklin Tax-Advantaged International Bond
Fund, Franklin Tax-Advantaged U.S. Government
Securities Fund, Franklin Tax-Free Trust, and
Franklin Strategic Mortgage Portfolio.
(b) The directors and officers of FTD are identified
below. Except as otherwise indicated, the
address of each director and officer is 777
Mariners Island Blvd., San Mateo, CA 94404.
Positions and Offices Positions and Offices
Name with Underwriter with Registrant
Gregory E. Johnson President None
Charles B. Johnson Director Trustee
and Vice President
Rupert H. Johnson, Jr. Executive Vice President None
and Director
Harmon E. Burns Executive Vice President None
and Director
Edward V. McVey Senior Vice President None
Kenneth V. Domingues Senior Vice President None
Martin L. Flanagan Senior Vice President Vice
and Treasurer President
William J. Lippman Senior Vice President None
Loretta Fry Vice President None
Deborah R. Gatzek Senior Vice President and None
Assistant Secretary
Richard C. Stoker Senior Vice President None
Charles E. Johnson Senior Vice President None
500 East Broward Blvd.
Ft. Lauderdale, FL 33394
James K. Blinn Vice President None
Richard O. Conboy Vice President None
James A. Escobedo Vice President None
Sheppard G. Griswold Vice President None
Carolyn L. Hennion Vice President None
Peter Jones Vice President None
700 Central Avenue
St. Petersburg, FL 33701
Philip J. Kearns Vice President None
Jack Lemein Vice President None
John R. McGee Vice President None
Thomas M. Mistele Vice President Secretary
700 Central Avenue
St. Petersburg, FL 33701
Harry G. Mumford Vice President None
Thomas H. O'Connor Vice President None
Vivian J. Palmieri Vice President None
Kent P. Strazza Vice President None
John R. Trayser Vice President None
Leslie M. Kratter Secretary None
Philip Bensen Assistant Vice President None
700 Central Avenue
St. Petersburg, FL 33701
James F. Duryea Assistant Vice President None
Robert N. Geppner Assistant Vice President None
Rich Handrich Assistant Vice President None
700 Central Avenue
St. Petersburg, FL 33701
Brad N. Hanson Assistant Vice President None
John R. Kay Assistant Vice President Vice President
500 East Broward Blvd.
Ft. Lauderdale, FL 33394
Richard S. Petrell Assistant Vice President None
Janice Salvato Assistant Vice President None
Clement Sanfilippo Assistant Vice President None
700 Central Avenue
St. Petersburg, FL 33701
Susan K. Tallarico Assistant Vice President None
Karen DeBellis Assistant Treasurer None
700 Central Avenue
St. Petersburg, FL 33701
Philip A. Scatena Assistant Treasurer None
Item 30. Location of Accounts and Records
The accounts, books and other documents required to be
maintained by Registrant pursuant to Section 31(a) of
the Investment Company Act of 1940 and rules promul-
gated thereunder are in the possession of Templeton
Global Investors, Inc., 500 East Broward Blvd., Fort
Lauderdale, Florida 33394.
Item 31. Management Services
Not Applicable.
Item 32. Undertakings
(a) Not Applicable.
(b) Not Applicable.
(c) Registrant undertakes to call a meeting of
Shareholders for the purpose of voting upon the
question of removal of a Trustee or Trustees when
requested to do so by the holders of at least 10%
of the Registrant's outstanding shares of
beneficial interest and in connection with such
meeting to comply with the shareholder
communications provisions of Section 16(c) of the
Investment Company Act of 1940.
(d) Registrant undertakes to furnish to each person
to whom a Prospectus for a series of the
Registrant is provided a copy of the series'
latest annual report, upon request and without
charge.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
as amended, and the Investment Company Act of 1940, as amended,
the Registrant has duly caused this amendment to the Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Washington, D.C. on the
16th day of February, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
By:
Mark G. Holowesko*
President
*By: /s/ William J. Kotapish
William J. Kotapish
attorney-in-fact**
Pursuant to the requirements of the Securities Act of 1933,
as amended, this amendment to the Registration Statement has been
signed below by the following persons in the capacities and on
the date indicated.
Signature Title Date
President February 16, 1995
Mark G. Holowesko* (Principal Executive
Officer)
Treasurer February 16, 1995
James R. Baio* (Principal Financial
and Accounting Officer)
Trustee February 16, 1995
John M. Templeton*
Trustee February 16, 1995
Charles B. Johnson*
Martin L. Flanagan* Trustee February 16, 1995
Trustee February 16, 1995
Hasso-G von Diergardt-Naglo*
Trustee February 16, 1995
F. Bruce Clarke*
Trustee February 16, 1995
Betty P. Krahmer*
Trustee February 16, 1995
Fred R. Millsaps*
Trustee February 16, 1995
John G. Bennett, Jr.*
Andrew H. Hines, Jr.* Trustee February 16, 1995
Trustee February 16, 1995
Harris J. Ashton*
Trustee February 16, 1995
S. Joseph Fortunato*
Trustee February 16, 1995
Gordon S. Macklin*
Trustee February 16, 1995
Nicholas F. Brady*
*By: /s/ William J. Kotapish
William J. Kotapish
attorney-in-fact**
______________________
** Powers of attorney were filed in Pre-Effective Amendment No. 1
to the Registration Statement on Form N-1A of Templeton Global
Investment Trust (File No. 33-73244), filed on March 1, 1994.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS FILED WITH
POST-EFFECTIVE AMENDMENT NO. 4 TO THE
REGISTRATION STATEMENT ON FORM N-1A
TEMPLETON GLOBAL INVESTMENT TRUST
Exhibit (5)(E)
Investment Management Agreement -
Templeton Greater European Fund
<PAGE>
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT dated as of the __th day of May, 1995 between
TEMPLETON GLOBAL INVESTMENT TRUST (hereinafter referred to as the
"Trust"), on behalf of TEMPLETON GREATER EUROPEAN FUND (the
"Fund"), and TEMPLETON, GALBRAITH & HANSBERGER LTD. (hereinafter
referred to as the "Investment Manager").
In consideration of the mutual agreements herein made,
the Trust on behalf of the Fund and the Investment Manager
understand and agree as follows:
(1) The Investment Manager shall manage the investment
and reinvestment of the Fund's assets consistent with the
provisions of the Trust Instrument of the Trust and the
investment policies adopted and declared by the Trust's Board of
Trustees. In pursuance of the foregoing, the Investment Manager
shall make all determinations with respect to the investment of
the Fund's assets and the purchase and sale of its investment
securities, and shall take such steps as may be necessary to
implement those determinations. Such determinations and services
shall include determining the manner in which any voting rights,
rights to consent to corporate action and any other rights
pertaining to the Fund's investment securities shall be
exercised, subject to guidelines adopted by the Board of
Trustees. It is understood that all acts of the Investment
Manager in performing this Agreement are performed by it outside
the United States.
(2) The Investment Manager is not required to furnish
any personnel, overhead items or facilities for the Fund,
including trading desk facilities or daily pricing of the Fund's
portfolio.
(3) The Investment Manager shall be responsible for
selecting members of securities exchanges, brokers and dealers
(such members, brokers and dealers being hereinafter referred to
as "brokers") for the execution of the Fund's portfolio trans-
actions consistent with the Trust's brokerage policies and, when
applicable, the negotiation of commissions in connection
therewith.
All decisions and placements shall be made in
accordance with the following principles:
A. Purchase and sale orders will usually be placed
with brokers which are selected by the Investment
Manager as able to achieve "best execution" of
such orders. "Best execution" shall mean prompt
and reliable execution at the most favorable
security price, taking into account the other
provisions hereinafter set forth. The
determination of what may constitute best
execution and price in the execution of a
securities transaction by a broker involves a
number of considerations, including, without
limitation, the overall direct net economic result
to the Fund (involving both price paid or received
and any commissions and other costs paid), the
efficiency with which the transaction is effected,
the ability to effect the transaction at all where
a large block is involved, availability of the
broker to stand ready to execute possibly
difficult transactions in the future, and the
financial strength and stability of the broker.
Such considerations are judgmental and are weighed
by the Investment Manager in determining the
overall reasonableness of brokerage commissions.
B. In selecting brokers for portfolio transactions,
the Investment Manager shall take into account its
past experience as to brokers qualified to achieve
"best execution," including brokers who specialize
in any foreign securities held by the Fund.
C. The Investment Manager is authorized to allocate
brokerage business to brokers who have provided
brokerage and research services, as such services
are defined in Section 28(e) of the Securities
Exchange Act of 1934 (the "1934 Act"), for the
Fund and/or other accounts, if any, for which the
Investment Manager exercises investment discretion
(as defined in Section 3(a)(35) of the 1934 Act)
and, as to transactions for which fixed minimum
commission rates are not applicable, to cause the
Fund to pay a commission for effecting a
securities transaction in excess of the amount
another broker would have charged for effecting
that transaction, if the Investment Manager
determines in good faith that such amount of
commission is reasonable in relation to the value
of the brokerage and research services provided by
such broker, viewed in terms of either that
particular transaction or the Investment Manager's
overall responsibilities with respect to the Fund
and the other accounts, if any, as to which it
exercises investment discretion. In reaching such
determination, the Investment Manager will not be
required to place or attempt to place a specific
dollar value on the research or execution services
of a broker or on the portion of any commission
reflecting either of said services. In
demonstrating that such determinations were made
in good faith, the Investment Manager shall be
prepared to show that all commissions were
allocated and paid for purposes contemplated by
the Trust's brokerage policy; that the research
services provide lawful and appropriate assistance
to the Investment Manager in the performance of
its investment decision-making responsibilities;
and that the commissions paid were within a
reasonable range. Whether commissions were within
a reasonable range shall be based on any available
information as to the level of commission known to
be charged by other brokers on comparable
transactions, but there shall be taken into
account the Trust's policies that (i) obtaining a
low commission is deemed secondary to obtaining a
favorable securities price, since it is recognized
that usually it is more beneficial to the Fund to
obtain a favorable price than to pay the lowest
commission; and (ii) the quality,
comprehensiveness and frequency of research
studies that are provided for the Investment
Manager are useful to the Investment Manager in
performing its advisory services under this
Agreement. Research services provided by brokers
to the Investment Manager are considered to be in
addition to, and not in lieu of, services required
to be performed by the Investment Manager under
this Agreement. Research furnished by brokers
through which the Fund effects securities
transactions may be used by the Investment Manager
for any of its accounts, and not all research may
be used by the Investment Manager for the Fund.
When execution of portfolio transactions is
allocated to brokers trading on exchanges with
fixed brokerage commission rates, account may be
taken of various services provided by the broker.
D. Purchases and sales of portfolio securities within
the United States other than on a securities
exchange shall be executed with primary market
makers acting as principal, except where, in the
judgment of the Investment Manager, better prices
and execution may be obtained on a commission
basis or from other sources.
E. Sales of the Fund's shares (which shall be deemed
to include also shares of other registered
investment companies which have either the same
adviser or an investment adviser affiliated with
the Investment Manager) by a broker are one factor
among others to be taken into account in deciding
to allocate portfolio transactions (including
agency transactions, principal transactions,
purchases in underwritings or tenders in response
to tender offers) for the account of the Fund to
that broker; provided that the broker shall
furnish "best execution," as defined in
subparagraph A above, and that such allocation
shall be within the scope of the Trust's policies
as stated above; provided further, that in every
allocation made to a broker in which the sale of
Fund shares is taken into account, there shall be
no increase in the amount of the commissions or
other compensation paid to such broker beyond a
reasonable commission or other compensation
determined, as set forth in subparagraph C above,
on the basis of best execution alone or best
execution plus research services, without taking
account of or placing any value upon such sale of
the Trust's shares.
(4) The Fund agrees to pay to the Investment Manager a
monthly fee in dollars at an annual rate of 0.60% of the Fund's
average daily net assets, payable at the end of each calendar
month.
Notwithstanding the foregoing, if the total expenses of
the Fund (including the fee to the Investment Manager) in any
fiscal year of the Trust exceed any expense limitation imposed by
applicable State law, the Investment Manager shall reimburse the
Fund for such excess in the manner and to the extent required by
applicable State law. The term "total expenses," as used in this
paragraph, does not include interest, taxes, litigation expenses,
distribution expenses, brokerage commissions or other costs of
acquiring or disposing of any of the Fund's portfolio securities
or any costs or expenses incurred or arising other than in the
ordinary and necessary course of the Fund's business. When the
accrued amount of such expenses exceeds this limit, the monthly
payment of the Investment Manager's fee will be reduced by the
amount of such excess, subject to adjustment month by month
during the balance of the Trust's fiscal year if accrued expenses
thereafter fall below the limit.
(5) This Agreement shall become effective on May __,
1995 and shall continue in effect until July 31, 1996. If not
sooner terminated, this Agreement shall continue in effect for
successive periods of 12 months each thereafter, provided that
each such continuance shall be specifically approved annually by
the vote of a majority of the Trust's Board of Trustees who are
not parties to this Agreement or "interested persons" (as defined
in Investment Company Act of 1940 (the "1940 Act")) of any such
party, cast in person at a meeting called for the purpose of
voting on such approval and either the vote of (a) a majority of
the outstanding voting securities of the Fund, as defined in the
1940 Act, or (b) a majority of the Trust's Board of Trustees as a
whole.
(6) Notwithstanding the foregoing, this Agreement may
be terminated by either party at any time, without the payment of
any penalty, on sixty (60) days' written notice to the other
party, provided that termination by the Trust is approved by vote
of a majority of the Trust's Board of Trustees in office at the
time or by vote of a majority of the outstanding voting
securities of the Fund (as defined by the 1940 Act).
(7) This Agreement will terminate automatically and
immediately in the event of its assignment (as defined in the
1940 Act).
(8) In the event this Agreement is terminated and the
Investment Manager no longer acts as Investment Manager to the
Fund, the Investment Manager reserves the right to withdraw from
the Fund the use of the name "Templeton" or any name misleadingly
implying a continuing relationship between the Fund and the
Investment Manager or any of its affiliates.
(9) Except as may otherwise be provided by the 1940
Act, neither the Investment Manager nor its officers, directors,
employees or agents shall be subject to any liability for any
error of judgment, mistake of law, or any loss arising out of any
investment or other act or omission in the performance by the
Investment Manager of its duties under the Agreement or for any
loss or damage resulting from the imposition by any government of
exchange control restrictions which might affect the liquidity of
the Fund's assets, or from acts or omissions of custodians, or
securities depositories, or from any war or political act of any
foreign government to which such assets might be exposed, or for
failure, on the part of the custodian or otherwise, timely to
collect payments, except for any liability, loss or damage
resulting from willful misfeasance, bad faith or gross negligence
on the Investment Manager's part or by reason of reckless
disregard of the Investment Manager's duties under this
Agreement. It is hereby understood and acknowledged by the Trust
that the value of the investments made for the Fund may increase
as well as decrease and are not guaranteed by the Investment
Manager. It is further understood and acknowledged by the Trust
that investment decisions made on behalf of the Fund by the
Investment Manager are subject to a variety of factors which may
affect the values and income generated by the Fund's portfolio
securities, including general economic conditions, market factors
and currency exchange rates, and that investment decisions made
by the Investment Manager will not always be profitable or prove
to have been correct.
(10) It is understood that the services of the
Investment Manager are not deemed to be exclusive, and nothing in
this Agreement shall prevent the Investment Manager, or any
affiliate thereof, from providing similar services to other
investment companies and other clients, including clients which
may invest in the same types of securities as the Fund, or, in
providing such services, from using information furnished by
others. When the Investment Manager determines to buy or sell
the same security for the Fund that the Investment Manager or one
or more of its affiliates has selected for clients of the
Investment Manager or its affiliates, the orders for all such
security transactions shall be placed for execution by methods
determined by the Investment Manager, with approval by the
Trust's Board of Trustees, to be impartial and fair.
(11) This Agreement shall be construed in accordance
with the laws of the State of Delaware, provided that nothing
herein shall be construed as being inconsistent with applicable
Federal and state securities laws and any rules, regulations and
orders thereunder.
(12) If any provision of this Agreement shall be held
or made invalid by a court decision, statute, rule or otherwise,
the remainder of this Agreement shall not be affected thereby
and, to this extent, the provisions of this Agreement shall be
deemed to be severable.
(13) Nothing herein shall be construed as constituting
the Investment Manager an agent of the Trust.
(14) It is understood and expressly stipulated that
neither the holders of shares of the Fund nor any Trustee,
officer, agent or employee of the Trust shall be personally
liable hereunder, nor shall any resort be had to other private
property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers
and their respective corporate seals to be hereunto duly affixed
and attested.
TEMPLETON GLOBAL INVESTMENT TRUST
By:_______________________________
John R. Kay
Vice President
ATTEST:
______________________________
Thomas M. Mistele
Secretary
TEMPLETON, GALBRAITH & HANSBERGER LTD.
By:_________________________________
Mark G. Holowesko
Executive Vice President
ATTEST:
______________________________
Exhibit (5)(F)
Investment Management Agreement -
Templeton Latin America Fund
<PAGE>
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT dated as of the __th day of May, 1995 between
TEMPLETON GLOBAL INVESTMENT TRUST (hereinafter referred to as the
"Trust"), on behalf of TEMPLETON LATIN AMERICA FUND (the "Fund"),
and TEMPLETON, GALBRAITH & HANSBERGER LTD. (hereinafter referred
to as the "Investment Manager").
In consideration of the mutual agreements herein made,
the Trust on behalf of the Fund and the Investment Manager
understand and agree as follows:
(1) The Investment Manager shall manage the investment
and reinvestment of the Fund's assets consistent with the
provisions of the Trust Instrument of the Trust and the
investment policies adopted and declared by the Trust's Board of
Trustees. In pursuance of the foregoing, the Investment Manager
shall make all determinations with respect to the investment of
the Fund's assets and the purchase and sale of its investment
securities, and shall take such steps as may be necessary to
implement those determinations. Such determinations and services
shall include determining the manner in which any voting rights,
rights to consent to corporate action and any other rights
pertaining to the Fund's investment securities shall be
exercised, subject to guidelines adopted by the Board of
Trustees. It is understood that all acts of the Investment
Manager in performing this Agreement are performed by it outside
the United States.
(2) The Investment Manager is not required to furnish
any personnel, overhead items or facilities for the Fund,
including trading desk facilities or daily pricing of the Fund's
portfolio.
(3) The Investment Manager shall be responsible for
selecting members of securities exchanges, brokers and dealers
(such members, brokers and dealers being hereinafter referred to
as "brokers") for the execution of the Fund's portfolio trans-
actions consistent with the Trust's brokerage policies and, when
applicable, the negotiation of commissions in connection
therewith.
All decisions and placements shall be made in
accordance with the following principles:
A. Purchase and sale orders will usually be placed
with brokers which are selected by the Investment
Manager as able to achieve "best execution" of
such orders. "Best execution" shall mean prompt
and reliable execution at the most favorable
security price, taking into account the other
provisions hereinafter set forth. The
determination of what may constitute best
execution and price in the execution of a
securities transaction by a broker involves a
number of considerations, including, without
limitation, the overall direct net economic result
to the Fund (involving both price paid or received
and any commissions and other costs paid), the
efficiency with which the transaction is effected,
the ability to effect the transaction at all where
a large block is involved, availability of the
broker to stand ready to execute possibly
difficult transactions in the future, and the
financial strength and stability of the broker.
Such considerations are judgmental and are weighed
by the Investment Manager in determining the
overall reasonableness of brokerage commissions.
B. In selecting brokers for portfolio transactions,
the Investment Manager shall take into account its
past experience as to brokers qualified to achieve
"best execution," including brokers who specialize
in any foreign securities held by the Fund.
C. The Investment Manager is authorized to allocate
brokerage business to brokers who have provided
brokerage and research services, as such services
are defined in Section 28(e) of the Securities
Exchange Act of 1934 (the "1934 Act"), for the
Fund and/or other accounts, if any, for which the
Investment Manager exercises investment discretion
(as defined in Section 3(a)(35) of the 1934 Act)
and, as to transactions for which fixed minimum
commission rates are not applicable, to cause the
Fund to pay a commission for effecting a
securities transaction in excess of the amount
another broker would have charged for effecting
that transaction, if the Investment Manager
determines in good faith that such amount of
commission is reasonable in relation to the value
of the brokerage and research services provided by
such broker, viewed in terms of either that
particular transaction or the Investment Manager's
overall responsibilities with respect to the Fund
and the other accounts, if any, as to which it
exercises investment discretion. In reaching such
determination, the Investment Manager will not be
required to place or attempt to place a specific
dollar value on the research or execution services
of a broker or on the portion of any commission
reflecting either of said services. In
demonstrating that such determinations were made
in good faith, the Investment Manager shall be
prepared to show that all commissions were
allocated and paid for purposes contemplated by
the Trust's brokerage policy; that the research
services provide lawful and appropriate assistance
to the Investment Manager in the performance of
its investment decision-making responsibilities;
and that the commissions paid were within a
reasonable range. Whether commissions were within
a reasonable range shall be based on any available
information as to the level of commission known to
be charged by other brokers on comparable
transactions, but there shall be taken into
account the Trust's policies that (i) obtaining a
low commission is deemed secondary to obtaining a
favorable securities price, since it is recognized
that usually it is more beneficial to the Fund to
obtain a favorable price than to pay the lowest
commission; and (ii) the quality,
comprehensiveness and frequency of research
studies that are provided for the Investment
Manager are useful to the Investment Manager in
performing its advisory services under this
Agreement. Research services provided by brokers
to the Investment Manager are considered to be in
addition to, and not in lieu of, services required
to be performed by the Investment Manager under
this Agreement. Research furnished by brokers
through which the Fund effects securities
transactions may be used by the Investment Manager
for any of its accounts, and not all research may
be used by the Investment Manager for the Fund.
When execution of portfolio transactions is
allocated to brokers trading on exchanges with
fixed brokerage commission rates, account may be
taken of various services provided by the broker.
D. Purchases and sales of portfolio securities within
the United States other than on a securities
exchange shall be executed with primary market
makers acting as principal, except where, in the
judgment of the Investment Manager, better prices
and execution may be obtained on a commission
basis or from other sources.
E. Sales of the Fund's shares (which shall be deemed
to include also shares of other registered
investment companies which have either the same
adviser or an investment adviser affiliated with
the Investment Manager) by a broker are one factor
among others to be taken into account in deciding
to allocate portfolio transactions (including
agency transactions, principal transactions,
purchases in underwritings or tenders in response
to tender offers) for the account of the Fund to
that broker; provided that the broker shall
furnish "best execution," as defined in
subparagraph A above, and that such allocation
shall be within the scope of the Trust's policies
as stated above; provided further, that in every
allocation made to a broker in which the sale of
Fund shares is taken into account, there shall be
no increase in the amount of the commissions or
other compensation paid to such broker beyond a
reasonable commission or other compensation
determined, as set forth in subparagraph C above,
on the basis of best execution alone or best
execution plus research services, without taking
account of or placing any value upon such sale of
the Trust's shares.
(4) The Fund agrees to pay to the Investment Manager a
monthly fee in dollars at an annual rate of 0.60% of the Fund's
average daily net assets, payable at the end of each calendar
month.
Notwithstanding the foregoing, if the total expenses of
the Fund (including the fee to the Investment Manager) in any
fiscal year of the Trust exceed any expense limitation imposed by
applicable State law, the Investment Manager shall reimburse the
Fund for such excess in the manner and to the extent required by
applicable State law. The term "total expenses," as used in this
paragraph, does not include interest, taxes, litigation expenses,
distribution expenses, brokerage commissions or other costs of
acquiring or disposing of any of the Fund's portfolio securities
or any costs or expenses incurred or arising other than in the
ordinary and necessary course of the Fund's business. When the
accrued amount of such expenses exceeds this limit, the monthly
payment of the Investment Manager's fee will be reduced by the
amount of such excess, subject to adjustment month by month
during the balance of the Trust's fiscal year if accrued expenses
thereafter fall below the limit.
(5) This Agreement shall become effective on May __,
1995 and shall continue in effect until July 31, 1996. If not
sooner terminated, this Agreement shall continue in effect for
successive periods of 12 months each thereafter, provided that
each such continuance shall be specifically approved annually by
the vote of a majority of the Trust's Board of Trustees who are
not parties to this Agreement or "interested persons" (as defined
in Investment Company Act of 1940 (the "1940 Act")) of any such
party, cast in person at a meeting called for the purpose of
voting on such approval and either the vote of (a) a majority of
the outstanding voting securities of the Fund, as defined in the
1940 Act, or (b) a majority of the Trust's Board of Trustees as a
whole.
(6) Notwithstanding the foregoing, this Agreement may
be terminated by either party at any time, without the payment of
any penalty, on sixty (60) days' written notice to the other
party, provided that termination by the Trust is approved by vote
of a majority of the Trust's Board of Trustees in office at the
time or by vote of a majority of the outstanding voting
securities of the Fund (as defined by the 1940 Act).
(7) This Agreement will terminate automatically and
immediately in the event of its assignment (as defined in the
1940 Act).
(8) In the event this Agreement is terminated and the
Investment Manager no longer acts as Investment Manager to the
Fund, the Investment Manager reserves the right to withdraw from
the Fund the use of the name "Templeton" or any name misleadingly
implying a continuing relationship between the Fund and the
Investment Manager or any of its affiliates.
(9) Except as may otherwise be provided by the 1940
Act, neither the Investment Manager nor its officers, directors,
employees or agents shall be subject to any liability for any
error of judgment, mistake of law, or any loss arising out of any
investment or other act or omission in the performance by the
Investment Manager of its duties under the Agreement or for any
loss or damage resulting from the imposition by any government of
exchange control restrictions which might affect the liquidity of
the Fund's assets, or from acts or omissions of custodians, or
securities depositories, or from any war or political act of any
foreign government to which such assets might be exposed, or for
failure, on the part of the custodian or otherwise, timely to
collect payments, except for any liability, loss or damage
resulting from willful misfeasance, bad faith or gross negligence
on the Investment Manager's part or by reason of reckless
disregard of the Investment Manager's duties under this
Agreement. It is hereby understood and acknowledged by the Trust
that the value of the investments made for the Fund may increase
as well as decrease and are not guaranteed by the Investment
Manager. It is further understood and acknowledged by the Trust
that investment decisions made on behalf of the Fund by the
Investment Manager are subject to a variety of factors which may
affect the values and income generated by the Fund's portfolio
securities, including general economic conditions, market factors
and currency exchange rates, and that investment decisions made
by the Investment Manager will not always be profitable or prove
to have been correct.
(10) It is understood that the services of the
Investment Manager are not deemed to be exclusive, and nothing in
this Agreement shall prevent the Investment Manager, or any
affiliate thereof, from providing similar services to other
investment companies and other clients, including clients which
may invest in the same types of securities as the Fund, or, in
providing such services, from using information furnished by
others. When the Investment Manager determines to buy or sell
the same security for the Fund that the Investment Manager or one
or more of its affiliates has selected for clients of the
Investment Manager or its affiliates, the orders for all such
security transactions shall be placed for execution by methods
determined by the Investment Manager, with approval by the
Trust's Board of Trustees, to be impartial and fair.
(11) This Agreement shall be construed in accordance
with the laws of the State of Delaware, provided that nothing
herein shall be construed as being inconsistent with applicable
Federal and state securities laws and any rules, regulations and
orders thereunder.
(12) If any provision of this Agreement shall be held
or made invalid by a court decision, statute, rule or otherwise,
the remainder of this Agreement shall not be affected thereby
and, to this extent, the provisions of this Agreement shall be
deemed to be severable.
(13) Nothing herein shall be construed as constituting
the Investment Manager an agent of the Trust.
(14) It is understood and expressly stipulated that
neither the holders of shares of the Fund nor any Trustee,
officer, agent or employee of the Trust shall be personally
liable hereunder, nor shall any resort be had to other private
property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers
and their respective corporate seals to be hereunto duly affixed
and attested.
TEMPLETON GLOBAL INVESTMENT TRUST
By:_______________________________
John R. Kay
Vice President
ATTEST:
______________________________
Thomas M. Mistele
Secretary
TEMPLETON, GALBRAITH & HANSBERGER LTD.
By:_________________________________
Mark G. Holowesko
Executive Vice President
ATTEST:
______________________________
Exhibit (6)(A)
Amended and Restated Distribution Agreement
<PAGE>
TEMPLETON GLOBAL INVESTMENT TRUST
700 Central Avenue
St. Petersburg, Florida 33701-3628
Franklin Templeton Distributors, Inc.
700 Central Avenue
St. Petersburg, Florida 33701-3628
Re: Distribution Agreement dated March 14, 1994 and amended and
restated June 27, 1994 and May __, 1995
Gentlemen:
We are a Delaware business trust operating as an open-end
management investment company. As such, our company, Templeton
Global Investment Trust (referred to herein as the "Trust"), on
behalf of Templeton Global Rising Dividends Fund, Templeton
Global Infrastructure Fund, Templeton Americas Government
Securities Fund, Templeton Greater European Fund, and Templeton
Latin America Fund (each a "Fund" and collectively, the "Funds"),
is registered under the Investment Company Act of 1940 (the "1940
Act"), and its shares are registered under the Securities Act of
1933 (the "1933 Act"). We desire to begin issuing our authorized
but unissued shares of beneficial interest (the "Shares") to
authorized persons in accordance with applicable Federal and
State securities laws.
You have informed us that your company is registered as a
broker-dealer under the provisions of the Securities Exchange Act
of 1934 and that your company is a member of the National
Association of Securities Dealers, Inc. You have indicated your
desire to act as the exclusive selling agent and distributor for
the Shares. We have been authorized to execute and deliver this
Agreement to you by a resolution of our Board of Trustees passed
at a meeting at which a majority of our Trustees, including a
majority who are not otherwise interested persons of the Trust
and who are not interested persons of our investment advisers,
their related organizations or with you or your related
organizations, were present and voted in favor of the said
resolution approving this Agreement.
1. Appointment of Underwriter. Upon the execution of this
Agreement and in consideration of the agreements on your part
herein expressed and upon the terms and conditions set forth
herein, we hereby appoint you as the exclusive sales agent for
our Shares (except for sales made directly by the Trust without
sales charge) and agree that we will deliver such Shares as you
may sell. You agree to use your best efforts to promote the sale
of Shares, but are not obligated to sell any specific number of
Shares.
2. Independent Contractor. You will undertake and
discharge your obligations hereunder as an independent contractor
and shall have no authority or power to obligate or bind us by
your actions, conduct or contracts except that you are authorized
to accept orders for the purchase or repurchase of Shares as our
agent. You may appoint sub-agents or distribute through dealers
or otherwise as you may determine from time to time, but this
Agreement shall not be construed as authorizing any dealer or
other person to accept orders for sale or repurchase on our
behalf or otherwise act as our agent for any purpose. You may
allow such sub-agents or dealers such commissions or discounts
not exceeding the total sales commission as you shall deem
advisable so long as any such commissions or discounts are set
forth in our current prospectus to the extent required by the
applicable Federal and State securities laws.
3. Offering Price. The Shares of the Funds shall be
offered for sale at a price equivalent to their respective net
asset value (as specified in each Fund's prospectus) plus a
variable percentage of the public offering price as sales
commission. On each business day on which the New York Stock
Exchange is open for business, we will furnish you with the net
asset value of the Shares which shall be determined in accordance
with our then effective prospectus. All Shares will be sold in
the manner set forth in our then effective prospectus.
4. Sales Commission. You shall be entitled to charge a
sales commission on the sale of our Shares in the amount set
forth in our then effective prospectus. Such commission (subject
to any quantity or other discounts or eliminations of commission
as set forth in our then current effective prospectus) shall be
an amount mutually agreed upon between us and equal to the
difference between the net asset value and the public offering
price of our Shares. You may reallow to dealers all or any part
of the discount you are allowed.
5. Terms and Conditions of Sales. Shares of the Funds
shall be offered for sale only in those jurisdictions where they
have been properly registered or are exempt from registration,
and only to those groups of people which the Board of Trustees
may from time to time determine to be eligible to purchase such
shares.
6. Payment of Shares. At or prior to the time of delivery
of any of our Shares you will pay or cause to be paid to our
Custodian or its successor, for our account, an amount in cash
equal to the net asset value of such Shares. In the event that
you pay for Shares sold by you prior to your receipt of payment
from purchasers you are authorized to reimburse yourself for the
net asset value of such Shares from the offering price of such
Shares when received by you.
7. Purchases for Your Own Account. You shall not purchase
our Shares for your own account for purposes of resale to the
public, but you may purchase Shares for your own investment
account upon your written assurance that the purchase is for
investment purposes and that the Shares will not be resold except
through redemption by us.
8. Sale of Shares at Net Asset Value. You may sell our
Shares at net asset value in accordance with the terms of each
Fund's then current prospectus.
9. Allocation of Expenses. We will pay the expenses:
(a) Of the preparation of the audited and certified
financial statements of our company to be included
in any Post-Effective Amendments ("Amendments") to
our Registration Statement under the 1933 Act or
1940 Act, including the prospectuses and statement
of additional information included therein;
(b) Of the preparation, including legal fees, and of
printing all Amendments or supplements filed with
the Securities and Exchange Commission, including
the copies of the prospectuses included in the
Amendments and the first 10 copies of the
definitive prospectuses or supplements thereto,
other than those necessitated by your (including
your "Parent's") activities or Rules and
Regulations related to your activities where such
Amendments or supplements result in expenses which
we would not otherwise have incurred;
(c) Of the preparation, printing and distribution of
any reports or communications which we send to our
existing shareholders; and
(d) Of filing and other fees to Federal and State
securities regulatory authorities necessary to
continue offering our Shares of any of the Funds
as you may require in connection with your duties
as underwriter.
You will pay the expenses:
(a) Of printing the copies of the prospectuses and any
supplements thereto and statement of additional
information which are necessary to continue to
offer our Shares;
(b) Of the preparation, excluding legal fees, and
printing of all Amendments and supplements to our
prospectuses and statement of additional
information if the Amendment or supplement arises
from your (including your "Parent's") activities
or Rules and Regulations related to your
activities and those expenses would not otherwise
have been incurred by us;
(c) Of printing additional copies, for use by you as
sales literature, of reports or other
communications which we have prepared for
distribution to our existing shareholders; and
(d) Incurred by you in advertising, promoting and
selling our Shares.
10. Furnishing of Information. We will furnish to you such
information with respect to the Funds and their Shares, in such
form and signed by such of our officers as you may reasonably
request, and we warrant that the statements therein contained
when so signed will be true and correct. We will also furnish
you with such information and will take such action as you may
reasonably request in order to qualify our Shares for sale to the
public under the Blue Sky Laws of jurisdictions in which you may
wish to offer them. We will also furnish you with annual audited
financial statements of our books and accounts certified by
independent public accountants, with semi-annual financial
statements prepared by us, and, from time to time, with such
additional information regarding our financial condition as you
may reasonably request.
11. Conduct of Business. Other than our currently
effective prospectuses, you will not issue any sales material or
statements except literature or advertising which conforms to the
requirements of Federal and State securities laws and regulations
and which have been filed, where necessary, with the appropriate
regulatory authorities. You will furnish us with copies of all
such materials prior to their use and no such material shall be
published if we shall reasonably and promptly object.
You shall comply with the applicable Federal and State laws
and regulations where our Shares are offered for sale and conduct
your affairs with us and with dealers, brokers or investors in
accordance with the Rules of Fair Practice of the National
Association of Securities Dealers, Inc. and in strict accordance
with the applicable provisions of the Trust Instrument and
By-Laws of the Trust.
In the absence of willful misfeasance, bad faith or
gross negligence on your part, or of reckless disregard of your
obligations hereunder, you shall not be subject to liability for
any act or omission in the course of, or connected with,
rendering services hereunder.
12. Contingent Deferred Sales Charges. You shall be
entitled to receive a contingent deferred sales charge from the
proceeds of redemption of Shares of the Funds on such terms and
in such amounts as are set forth in the then current prospectus
of each Fund. In addition, you may retain any amounts authorized
for payment to you under each Fund's Distribution Plan.
13. Redemption or Repurchase Within Seven Days. If Shares
are tendered to us for redemption or repurchase by us within
seven business days after your acceptance of the original
purchase order for such Shares, you will immediately refund to us
the full sales commission (net of allowances to dealers or
brokers) allowed to you on the original sale, and will promptly,
upon receipt thereof, pay to us any refunds from dealers or
brokers of the balance of sales commissions reallowed by you. We
shall notify you of such tender for redemption within 10 days of
the day on which notice of such tender for redemption is received
by us.
14. Other Activities. Your services pursuant to this
Agreement shall not be deemed to be exclusive, and you may render
similar services and act as an underwriter, distributor or dealer
for other investment companies in the offering of their shares.
15. Term of Agreement. This Agreement shall become
effective on the date of its execution, and shall remain in
effect until July 31, 1995. The Agreement is renewable annually
thereafter with respect to the Fund for successive periods not to
exceed one year (i) by a vote of a majority of the outstanding
voting securities of the Funds or by a vote of the Board of
Trustees of the Trust, and (ii) by a vote of a majority of the
Trustees of the Trust who are not parties to the Agreement or
interested persons of any parties to the Agreement (other than as
Trustees of the Trust), cast in person at a meeting called for
the purpose of voting on the Agreement.
This Agreement may at any time be terminated by the Trust
without the payment of any penalty, (i) either by vote of the
Board of Trustees of the Trust or by vote of a majority of the
outstanding voting securities of the Trust, on 60 days' written
notice to you; or (ii) by you on 60 days' written notice to the
Trust; and shall immediately terminate with respect to the Trust
in the event of its assignment.
16. Suspension of Sales. We reserve the right at all times
to suspend or limit the public offering of the Shares of the
Funds upon two days' written notice to you.
17. Miscellaneous. This Agreement shall be subject to the
laws of the State of California and shall be interpreted and
construed to further promote the operation of the Trust as
an open-end investment company. As used herein the terms "Net
Asset Value", "Offering Price", "Investment Company", "Open-End
Investment Company", "Assignment", "Principal Underwriter",
"Interested Person", "Parents", "Affiliated Person", and
"Majority of the Outstanding Voting Securities" shall have the
meanings set forth in the 1933 Act or the 1940 Act and the Rules
and Regulations thereunder.
If the foregoing meets with your approval, please acknowledge
your acceptance by signing each of the enclosed copies, whereupon
this will become a binding agreement as of the date set forth
below.
Very truly yours,
TEMPLETON GLOBAL INVESTMENT TRUST
By:
Accepted:
FRANKLIN TEMPLETON DISTRIBUTORS, INC.
By:
DATED: May __, 1995
Exhibit (8)
Amended and Restated Custody Agreement
<PAGE>
CUSTODY AGREEMENT
AGREEMENT dated as of March 14, 1994 and amended and
restated June 27, 1994 and May __, 1995, between THE CHASE
MANHATTAN BANK, N.A. ("Chase"), having its principal place of
business at 1 Chase Manhattan Plaza, New York, New York 10081,
and TEMPLETON GLOBAL INVESTMENT TRUST (the "Trust"), an
investment company registered under the Investment Company Act of
1940 ("Act of 1940"), having its principal place of business at
700 Central Avenue, St. Petersburg, Florida 33701.
WHEREAS, the Trust, on behalf of Templeton Global
Infrastructure Fund, Templeton Global Rising Dividends Fund,
Templeton Americas Government Securities Fund, Templeton Greater
European Fund, and Templeton Latin America Fund (each a "Fund",
and collectively, the "Funds"), wishes to appoint Chase as
custodian to the securities and assets of each Fund and Chase is
willing to act as custodian under the terms and conditions
hereinafter set forth;
NOW, THEREFORE, the Trust and its successors and
assigns and Chase and its successors and assigns, hereby agree as
follows:
1. Appointment as Custodian. Chase agrees to act as
custodian for the Funds, as provided herein, in connection with
(a) cash ("Cash") received from time to time from, or for the
account of, each Fund for credit to each Fund's deposit account
or accounts administered by Chase, Chase Branches and Domestic
Securities Depositories (as hereinafter defined), and/or Foreign
Banks and Foreign Securities Depositories (as hereinafter
defined) (the "Deposit Account"); (b) all stocks, shares, bonds,
debentures, notes, mortgages, or other obligations for the
payment of money and any certificates, receipts, warrants, or
other instruments representing rights to receive, purchase, or
subscribe for the same or evidencing or representing any other
rights or interests therein and other similar property
("Securities") from time to time received by Chase and/or any
Chase Branch, Domestic Securities Depository, Foreign Bank or
Foreign Securities Depository for the account of the Trust (the
"Custody Account"); and (c) original margin and variation margin
payments in a segregated account for futures contracts (the
"Segregated Account").
All Cash held in the Deposit Account or in the
Segregated Account in connection with which Chase agrees to act
as custodian is hereby denominated as a special deposit which
shall be held in trust for the benefit of each Fund and to which
Chase, Chase Branches and Domestic Securities Depositories and/or
Foreign Banks and Foreign Securities Depositories shall have no
ownership rights, and Chase will so indicate on its books and
records pertaining to the Deposit Account and the Segregated
Account. All cash held in auxiliary accounts that may be carried
for the Funds with Chase (including a Money Market Account,
Redemption Account, Distribution Account and Imprest Account) is
not so denominated as a special deposit and title thereto is held
by Chase subject to the claims of creditors.
2. Authorization to Use Book-Entry System, Domestic
Securities Depositories, Branch Offices, Foreign Banks and
Foreign Securities Depositories. Chase is hereby authorized to
appoint and utilize, subject to the provisions of Sections 4 and
5 hereof:
A. The Book Entry System and The Depository
Trust Fund; and also such other Domestic Securities
Depositories selected by Chase and as to which Chase
has received a certified copy of a resolution of the
Trust's Board of Trustees authorizing deposits therein;
B. Chase's foreign branch offices in the United
Kingdom, Hong Kong, Singapore, and Tokyo, and such
other foreign branch offices of Chase located in
countries approved by the Board of Trustees of the
Trust as to which Chase shall have given prior notice
to the Trust;
C. Foreign Banks which Chase shall have
selected, which are located in countries approved by
the Board of Trustees of the Trust, and as to which
banks Chase shall have given prior notice to the Trust;
and
D. Foreign Securities Depositories which Chase
shall have selected and as to which Chase has received
a certified copy of a resolution of the Trust's Board
of Trustees authorizing deposits therein;
to hold Securities and Cash at any time owned by each Fund, it
being understood that no such appointment or utilization shall in
any way relieve Chase of its responsibilities as provided for in
this Agreement. Foreign branch offices of Chase appointed and
utilized by Chase are herein referred to as "Chase Branches."
Unless otherwise agreed to in writing, (a) each Chase Branch,
each Foreign Bank and each Foreign Securities Depository shall be
selected by Chase to hold only Securities as to which the
principal trading market or principal location as to which such
Securities are to be presented for payment is located outside the
United States; and (b) Chase and each Chase Branch, Foreign Bank
and Foreign Securities Depository will promptly transfer or cause
to be transferred to Chase, to be held in the United States,
Securities and/or Cash that are then being held outside the
United States upon request of each Fund and/or of the Securities
and Exchange Commission. Utilization by Chase of Chase Branches,
Domestic Securities Depositories, Foreign Banks and Foreign
Securities Depositories shall be in accordance with provisions as
from time to time amended, of an operating agreement to be
entered into between Chase and the Trust (the "Operating
Agreement").
3. Definitions. As used in this Agreement, the
following terms shall have the following meanings:
(a) "Authorized Persons of the Trust" shall mean
such officers or employees of the Trust or any other
person or persons as shall have been designated by a
resolution of the Board of Trustees of the Trust, a
certified copy of which has been filed with Chase, to
act as Authorized Persons hereunder. Such persons
shall continue to be Authorized Persons of the Trust,
authorized to act either singly or together with one or
more other of such persons as provided in such
resolution, until such time as the Trust shall have
filed with Chase a written notice of the Trust
supplementing, amending, or revoking the authority of
such persons.
(b) "Book-Entry system" shall mean the Federal
Reserve/Treasury book-entry system for United States
and federal agency securities, its successor or
successors and its nominee or nominees.
(c) "Domestic Securities Depository" shall mean
The Depository Trust Company, a clearing agency
registered with the Securities and Exchange Commission,
its successor or successors and its nominee or
nominees; and (subject to the receipt by Chase of a
certified copy of a resolution of the Trust's Board of
Trustees specifically approving deposits therein as
provided in Section 2(a) of this Agreement) any other
person authorized to act as a depository under the Act
of 1940, its successor or successors and its nominee or
nominees.
(d) "Foreign Bank" shall mean any banking
institution organized under the laws of a jurisdiction
other than the United States or of any state thereof.
(e) A "Foreign Securities Depository" shall mean
any system for the central handling of securities
abroad where all securities of any particular class or
series of any issuer deposited within the system are
treated as fungible and may be transferred or pledged
by bookkeeping without physical delivery of the
securities by any Chase Branch or Foreign Bank.
(f) "Written Instructions" shall mean
instructions in writing signed by Authorized Persons of
the Trust giving such instructions, and/or such other
forms of communications as from time to time shall be
agreed upon in writing between the Trust and Chase.
4. Selection of Countries in Which Securities May be
Held. Chase shall not cause Securities and Cash to be held in
any country outside the United States until the Trust has
directed the holding of each Fund's assets in such country.
Chase will be provided with a copy of a resolution of the Trust's
Board of Trustees authorizing such custody in any country outside
of the United States, which resolution shall be based upon, among
other factors, the following:
(a) comparative operational efficiencies of
custody;
(b) clearance and settlement and the costs
thereof; and
(c) political and other risks, other than those
risks specifically assumed by Chase.
5. Responsibility of Chase to Select Custodians in
Individual Foreign Countries. The responsibility for selecting
the Chase Branch, Foreign Bank or Foreign Securities Depository
to hold each Fund's Securities and Cash in individual countries
authorized by the Trust shall be that of Chase. Chase generally
shall utilize Chase Branches where available. In locations where
there are no Chase Branches providing custodial services, Chase
shall select as its agent a Foreign Bank, which may be an
affiliate or subsidiary of Chase. To facilitate the clearance
and settlement of securities transactions, Chase represents that,
subject to the approval of the Trust, it may deposit Securities
in a Foreign Securities Depository in which Chase is a
participant. In situations in which Chase is not a participant
in a Foreign Securities Depository, Chase may, subject to the
approval of the Trust, authorize a Foreign Bank acting as its
subcustodian to deposit the Securities in a Foreign Securities
Depository in which the Foreign Bank is a participant.
Notwithstanding the foregoing, such selection by Chase of a
Foreign Bank or Foreign Securities Depository shall not become
effective until Chase has been advised by the Trust that a
majority of its Board of Trustees:
(a) Has approved Chase's selection of the
particular Foreign Bank or Foreign Securities
Depository, as the case may be, as consistent with the
best interests of the Funds and their Shareholders; and
(b) Has approved as consistent with the best
interests of the Funds and their Shareholders a written
contract prepared by Chase which will govern the manner
in which such Foreign Bank will maintain each Fund's
assets.
6. Conditions on Selection of Foreign Bank or Foreign
Securities Depository. Chase shall authorize the holding of
Securities and Cash by a Chase Branch, Foreign Bank or Foreign
Securities Depository only:
(a) to the extent that the Securities and Cash
are not subject to any right, charge, security
interest, lien or claim of any kind in favor of any
such Foreign Bank or Foreign Securities Depository,
except for their safe custody or administration; and
(b) to the extent that the beneficial ownership
of Securities is freely transferable without the
payment of money or value other than for safe custody
or administration.
7. Chase Branches and Foreign Banks Not Agents of the
Trust. Chase Branches, Foreign Banks and Foreign Securities
Depositories shall be subject to the instructions of Chase and/or
the Foreign Bank, and not to those of the Trust. Chase warrants
and represents that all such instructions shall afford protection
to the Trust at least equal to that afforded for Securities held
directly by Chase. Any Chase Branch, Foreign Bank or Foreign
Securities Depository shall act solely as agent of Chase or of
such Foreign Bank.
8. Custody Account. Securities held in the Custody
Account shall be physically segregated at all times from those of
any other person or persons except that (a) with respect to
Securities held by Chase Branches, such Securities may be placed
in an omnibus account for the customers of Chase, and Chase shall
maintain separate book entry records for each such omnibus
account, and such Securities shall be deemed for the purpose of
this Agreement to be held by Chase in the Custody Account; (b)
with respect to Securities deposited by Chase with a Foreign
Bank, a Domestic Securities Depository or a Foreign Securities
Depository, Chase shall identify on its books as belonging to the
Trust the Securities shown on Chase's account on the books of the
Foreign Bank, Domestic Securities Depository or Foreign
Securities Depository; and (c) with respect to Securities
deposited by a Foreign Bank with a Foreign Securities Depository,
Chase shall cause the Foreign Bank to identify on its books as
belonging to Chase, as agent, the Securities shown on the Foreign
Bank's account on the books of the Foreign Securities Depository.
All Securities of the Trust maintained by Chase pursuant to this
Agreement shall be subject only to the instructions of Chase,
Chase Branches or their agents. Chase shall only deposit
Securities with a Foreign Bank in accounts that include only
assets held by Chase for its customers.
8a. Segregated Account for Futures Contracts. With
respect to every futures contract purchased, sold or cleared for
the Custody Account, Chase agrees, pursuant to Written
Instructions, to:
(a) deposit original margin and variation margin
payments in a segregated account maintained by Chase;
and
(b) perform all other obligations attendant to
transactions or positions in such futures contracts, as
such payments or performance may be required by law or
the executing broker.
8b. Segregated Account for Repurchase Agreements.
With respect to purchases for the Custody Account from banks
(including Chase) or broker-dealers, of United States or foreign
government obligations subject to repurchase agreements, Chase
agrees, pursuant to Written Instructions, to:
(a) deposit such securities and repurchase
agreements in a segregated account maintained by Chase;
and
(b) promptly show on Chase's records that such
securities and repurchase agreements are being held on
behalf of a Fund and deliver to that Fund a written
confirmation to that effect.
8c. Segregated Accounts for Deposits of Collateral.
Chase agrees, with respect to (i) cash or high quality debt
securities to secure each Fund's commitments to purchase new
issues of debt obligations offered on a when-issued basis; (ii)
cash, U.S. government securities, or irrevocable letters of
credit of borrowers of each Fund's portfolio securities to secure
the loan to them of such securities; and/or (iii) cash,
securities or any other property delivered to secure any other
obligations; (all of such items being hereinafter referred to as
"collateral"), pursuant to Written Instructions, to:
(a) deposit the collateral for each such
obligation in a separate segregated account maintained
by Chase; and
(b) promptly to show on Chase's records that such
collateral is being held on behalf of a Fund and
deliver to that Fund a written confirmation to that
effect.
9. Deposit Account. Subject to the provisions of
this Agreement, the Trust authorizes Chase to establish and
maintain in each country or other jurisdiction in which the
principal trading market for any Securities is located or in
which any Securities are to be presented for payment, an account
or accounts, which may include nostro accounts with Chase
Branches and omnibus accounts of Chase at Foreign Banks, for
receipt of cash in the Deposit Account, in such currencies as
directed by Written Instructions. For purposes of this
Agreement, cash so held in any such account shall be evidenced by
separate book entries maintained by Chase at its office in London
and shall be deemed to be Cash held by Chase in the Deposit
Account. Unless Chase receives Written Instructions to the
contrary, cash received or credited by Chase or any other Chase
Branch, Foreign Bank or Foreign Securities Depository for the
Deposit Account in a currency other than United States dollars
shall be converted promptly into United States dollars whenever
it is practicable to do so through customary banking channels
(including without limitation the effecting of such conversions
at Chase's preferred rates through Chase, its affiliates or Chase
Branches), and shall be automatically transmitted back to Chase
in the United States.
10. Settlement Procedures. Settlement procedures for
transactions in Securities delivered to, held in, or to be
delivered from the Custody Account in Chase Branches, Domestic
Securities Depositories, Foreign Banks and Foreign Securities
Depositories, including receipts and payments of cash held in any
nostro account or omnibus account for the Deposit Account as
described in Section 9, shall be carried out in accordance with
the provisions of the Operating Agreement. It is understood that
such settlement procedures may vary, as provided in the Operating
Agreement, from securities market to securities market, to
reflect particular settlement practices in such markets.
Chase shall make or cause the appropriate Chase Branch
or Foreign Bank to move payments of Cash held in the Deposit
Account only:
(a) in connection with the purchase of Securities
for the account of each Fund and only against the
receipt of such Securities by Chase or by another
appropriate Chase Branch, Domestic Securities
Depository, Foreign Bank or Foreign Securities
Depository, or otherwise as provided in the Operating
Agreement, each such payment to be made at prices
confirmed by Written Instructions, or
(b) in connection with any dividend, interim
dividend or other distribution declared by the Trust,
or
(c) as directed by the Trust by Written
Instructions setting forth the name and address of the
person to whom the payment is to be made and the
purpose for which the payment is to be made.
Upon the receipt by Chase of Written Instructions
specifying the Securities to be so transferred or delivered,
which instructions shall name the person or persons to whom
transfers or deliveries of such Securities shall be made and
shall indicate the time(s) for such transfers or deliveries,
Securities held in the Custody Account shall be transferred,
exchanged, or delivered by Chase, any Chase Branch, Domestic
Securities Depository, Foreign Bank, or Foreign Securities
Depository, as the case may be, against payment in Cash or
Securities, or otherwise as provided in the Operating Agreement,
only:
(a) upon sale of such Securities for the account
of a Fund and receipt of such payment in the amount
shown in a broker's confirmation of sale of the
Securities or other proper authorization received by
Chase before such payment is made, as confirmed by
Written Instructions;
(b) in exchange for or upon conversion into other
Securities alone or other Securities and Cash pursuant
to any plan of merger, consolidation, reorganization,
recapitalization, readjustment, or tender offer;
(c) upon exercise of conversion, subscription,
purchase, or other similar rights represented by such
Securities; or
(d) otherwise as directed by the Trust by Written
Instructions which shall set forth the amount and
purpose of such transfer or delivery.
Until Chase receives Written Instructions to the
contrary, Chase shall, and shall cause each Chase Branch,
Domestic Securities Depository, Foreign Bank and Foreign
Securities Depository holding Securities or Cash to, take the
following actions in accordance with procedures established in
the Operating Agreement:
(a) collect and timely deposit in the Deposit
Account all income due or payable with respect to any
Securities and take any action which may be necessary
and proper in connection with the collection and
receipt of such income;
(b) present timely for payment all Securities in
the Custody Account which are called, redeemed or
retired or otherwise become payable and all coupons and
other income items which call for payment upon
presentation and to receive and credit to the Deposit
Account Cash so paid for the account of each Fund
except that, if such Securities are convertible, such
Securities shall not be presented for payment until two
business days preceding the date on which such
conversion rights would expire unless Chase previously
shall have received Written Instructions with respect
thereto;
(c) present for exchange all Securities in the
Custody Account converted pursuant to their terms into
other Securities;
(d) in respect of securities in the Custody
Account, execute in the name of the Trust such
ownership and other certificates as may be required to
obtain payments in respect thereto, provided that Chase
shall have requested and the Trust shall have furnished
to Chase any information necessary in connection with
such certificates;
(e) exchange interim receipts or temporary
Securities in the Custody Account for definitive
Securities; and
(f) receive and hold in the Custody Account all
Securities received as a distribution on Securities
held in the Custody Account as a result of a stock
dividend, share split-up or reorganization,
recapitalization, readjustment or other rearrangement
or distribution of rights or similar Securities issued
with respect to any Securities held in the Custody
Account.
11. Records. Chase hereby agrees that Chase and any
Chase Branch or Foreign Bank shall create, maintain, and retain
all records relating to their activities and obligations as
custodian for the Trust under this Agreement in such manner as
will meet the obligations of the Trust under the Act of 1940,
particularly Section 31 thereof and Rules 31a-1 and 31a-2
thereunder, and Federal, state and foreign tax laws and other
legal or administrative rules or procedures, in each case as
currently in effect and applicable to the Trust. All records so
maintained in connection with the performance of its duties under
this Agreement shall, in the event of termination of this
Agreement, be preserved and maintained by Chase as required by
regulation, and shall be made available to the Trust or its agent
upon request, in accordance with the provisions of Section 19.
Chase hereby agrees, subject to restrictions under
applicable laws, that the books and records of Chase and any
Chase Branch pertaining to their actions under this Agreement
shall be open to the physical, on-premises inspection and audit
at reasonable times by the independent accountants
("Accountants") employed by, or other representatives of, the
Trust. Chase hereby agrees that, subject to restrictions under
applicable laws, access shall be afforded to the Accountants to
such of the books and records of any Foreign Bank, Domestic
Securities Depository or Foreign Securities Depository with
respect to Securities and Cash as shall be required by the
Accountants in connection with their examination of the books and
records pertaining to the affairs of the Trust. Chase also
agrees that as the Trust may reasonably request from time to
time, Chase shall provide the Accountants with information with
respect to Chase's and Chase Branches' systems of internal
accounting controls as they relate to the services provided under
this Agreement, and Chase shall use its best efforts to obtain
and furnish similar information with respect to each Domestic
Securities Depository, Foreign Bank and Foreign Securities
Depository holding Securities and Cash.
12. Reports. Chase shall supply periodically, upon
the reasonable request of the Trust, such statements, reports,
and advices with respect to Cash in the Deposit Account and the
Securities in the Custody Account and transactions in Securities
from time to time received and/or delivered for or from the
Custody Account, as the case may be, as the Trust shall require.
Such statements, reports and advices shall include an identifi-
cation of the Chase Branch, Domestic Securities Depository,
Foreign Bank and Foreign Securities Depository having custody of
the Securities and Cash, and descriptions thereof.
13. Registration of Securities. Securities in the
Custody Account which are issued or issuable only in bearer form
(except such securities as are held in the Book-Entry System)
shall be held by Chase, Chase Branches, Domestic Securities
Depositories, Foreign Banks or Foreign Securities Depositories in
that form. All other Securities in the Custody Account shall be
held in registered form in the name of Chase, or any Chase
Branch, the Book-Entry System, Domestic Securities Depository,
Foreign Bank or Foreign Securities Depository and their nominees,
as custodian or nominee.
14. Standard of Care.
(a) General. Chase shall assume entire
responsibility for all Securities held in the Custody
Account, Cash held in the Deposit Account, Cash or
Securities held in the Segregated Account and any of
the Securities and Cash while in the possession of
Chase or any Chase Branch, Domestic Securities
Depository, Foreign Bank or Foreign Securities
Depository, or in the possession or control of any
employees, agents or other personnel of Chase or any
Chase Branch, Domestic Securities Depository, Foreign
Bank or Foreign Securities Depository; and shall be
liable to the Trust for any loss to the Trust
occasioned by any destruction of the Securities or Cash
so held or while in such possession, by any robbery,
burglary, larceny, theft or embezzlement by any
employees, agents or personnel of Chase or any Chase
Branch, Domestic Securities Depository, Foreign Bank or
Foreign Securities Depository, and/or by virtue of the
disappearance of any of the Securities or Cash so held
or while in such possession, with or without any fault
attributable to Chase ("fault attributable to Chase"
for the purposes of this Agreement being deemed to mean
any negligent act or omission, robbery, burglary,
larceny, theft or embezzlement by any employees or
agents of Chase or any Chase Branch, Domestic
Securities Depository, Foreign Bank or Foreign
Securities Depository). In the event of Chase's
discovery or notification of any such loss of
Securities or Cash, Chase shall promptly notify the
Trust and shall reimburse the Trust to the extent of
the market value of the missing Securities or Cash as
at the date of the discovery of such loss. The Trust
shall not be obligated to establish any negligence,
misfeasance or malfeasance on Chase's part from which
such loss resulted, but Chase shall be obligated
hereunder to make such reimbursement to the Trust after
the discovery or notice of such loss, destruction or
theft of such Securities or Cash. Chase may at its
option insure itself against loss from any cause but
shall be under no obligation to insure for the benefit
of the Trust.
(b) Collections. All collections of funds or
other property paid or distributed in respect of
Securities held in the Custody Account shall be made at
the risk of the Trust. Chase shall have no liability
for any loss occasioned by delay in the actual receipt
of notice by Chase (or by any Chase Branch or Foreign
Bank in the case of Securities or Cash held outside of
the United States) of any payment, redemption or other
transaction regarding Securities held in the Custody
Account or Cash held in the Deposit Account in respect
of which Chase has agreed to take action in the absence
of Written Instructions to the contrary as provided in
Section 10 of this Agreement, which does not appear in
any of the publications referred to in Section 16 of
this Agreement.
(c) Exclusions. Notwithstanding any other
provision in this Agreement to the contrary, Chase
shall not be responsible for (i) losses resulting from
war or from the imposition of exchange control
restrictions, confiscation, expropriation, or
nationalization of any securities or assets of the
issuer of such securities, or (ii) losses resulting
from any negligent act or omission of the Trust or any
of its affiliates, or any robbery, theft, embezzlement
or fraudulent act by any employee or agent of the Trust
or any of its affiliates. Chase shall not be liable
for any action taken in good faith upon Written
Instructions of Authorized Persons of the Trust or upon
any certified copy of any resolution of the Board of
Trustees of the Trust, and may rely on the genuineness
of any such documents which it may in good faith
believe to be validly executed.
(d) Limitation on Liability under Section 14(a).
Notwithstanding any other provision in this Agreement
to the contrary, it is agreed that Chase's sole
responsibility with respect to losses under Section
14(a) shall be to pay the Trust the amount of any such
loss as provided in Section 14(a) (subject to the
limitation provided in Section 14(e) of this
Agreement). This limitation does not apply to any
liability of Chase under Section 14(f) of this Agree-
ment.
(e) Annual Adjustment of Limitation of Liability.
As soon as practicable after June 1 of every year, the
Trust shall provide Chase with the amount of its total
net assets as of the close of business on such date (or
if the New York Stock Exchange is closed on such date,
then in that event as of the close of business on the
next day on which the New York Stock Exchange is open
for business).
It is understood by the parties to this Agreement
(1) that Chase has entered into substantially similar
custody agreements with other Templeton Funds, all of
which Funds have as their investment adviser the
Investment Manager of Templeton Global Rising Dividends
Fund, Templeton Greater European Fund and Templeton
Latin America Fund, or the Investment Manager of
Templeton Global Infrastructure Fund or Templeton
Americas Government Securities Fund, or companies which
are affiliated with either Investment Manager; and (2)
that Chase may enter into substantially similar custody
agreements with additional mutual funds under Templeton
management which may hereafter be organized. Each of
such custody agreements with each of such other
Templeton Funds contains (or will contain) a "Standard
of Care" section similar to this Section 14, except
that the limit of Chase's liability is (or will be) in
varying amounts for each Fund, with the aggregate
limits of liability in all of such agreements,
including this Agreement, amounting to $150,000,000.
On each June 1, Chase will total the net assets
reported by each one of the Templeton Funds, and will
calculate the percentage of the aggregate net assets of
all the Templeton Funds that is represented by the net
asset value of this Trust. Thereupon Chase shall
allocate to this Agreement with this Trust that propor-
tion of its total of $150,000,000 responsibility
undertaking which is substantially equal to the propor-
tion which this Trust's net assets bears to the total
net assets of all such Templeton Funds subject to
adjustments for claims paid as follows: all claims
previously paid to this Trust shall first be deducted
from its proportionate allocable share of the
$150,000,000 Chase responsibility, and if the claims
paid to this Trust amount to more than its allocable
share of the Chase responsibility, then the excess of
such claims paid to this Trust shall diminish the
balance of the $150,000,000 Chase responsibility
available for the proportionate shares of all of the
other Templeton Funds having similar custody agreements
with Chase. Based on such calculation, and on such
adjustment for claims paid, if any, Chase thereupon
shall notify the Trust of such limit of liability under
this Section 14 which will be available to the Trust
with respect to (1) losses in excess of payment alloca-
tions for previous years and (2) losses discovered
during the next year this Agreement remains in effect
and until a new determination of such limit of respon-
sibility is made on the next succeeding June 1.
(f) Other liability. Independently of Chase's
liability to the Trust as provided in Section 14(a)
above (it being understood that the limitations in
Sections 14(d) and 14(e) do not apply to the provisions
of this Section 14(f)), Chase shall be responsible for
the performance of only such duties as are set forth in
this Agreement or contained in express instructions
given to Chase which are not contrary to the provisions
of this Agreement. Chase will use and require the same
care with respect to the safekeeping of all Securities
held in the Custody Account, Cash held in the Deposit
Account, and Securities or Cash held in the Segregated
Account as it uses in respect of its own similar
property, but it need not maintain any insurance for
the benefit of the Trust. With respect to Securities
and Cash held outside of the United States, Chase will
be liable to the Trust for any loss to the Trust
resulting from any disappearance or destruction of such
Securities or Cash while in the possession of Chase or
any Chase Branch, Foreign Bank or Foreign Securities
Depository, to the same extent it would be liable to
the Trust if Chase had retained physical possession of
such Securities and Cash in New York. It is
specifically agreed that Chase's liability under this
Section 14(f) is entirely independent of Chase's
liability under Section 14(a). Notwithstanding any
other provision in this Agreement to the contrary, in
the event of any loss giving rise to liability under
this Section 14(f) that would also give rise to
liability under Section 14(a), the amount of such
liability shall not be charged against the amount of
the limitation on liability provided in Section 14(d).
(g) Counsel; legal expenses. Chase shall be
entitled to the advice of counsel (who may be counsel
for the Trust) at the expense of the Trust, in
connection with carrying out Chase's duties hereunder
and in no event shall Chase be liable for any action
taken or omitted to be taken by it in good faith
pursuant to advice of such counsel. If, in the absence
of fault attributable to Chase and in the course of or
in connection with carrying out its duties and
obligations hereunder, any claims or legal proceedings
are instituted against Chase or any Chase Branch by
third parties, the Trust will hold Chase harmless
against any claims, liabilities, costs, damages or
expenses incurred in connection therewith and, if the
Trust so elects, the Trust may assume the defense
thereof with counsel satisfactory to Chase, and
thereafter shall not be responsible for any further
legal fees that may be incurred by Chase, provided,
however, that all of the foregoing is conditioned upon
the Trust's receipt from Chase of prompt and due notice
of any such claim or proceeding.
15. Expropriation Insurance. Chase represents that it
does not intend to obtain any insurance for the benefit of the
Trust which protects against the imposition of exchange control
restrictions on the transfer from any foreign jurisdiction of the
proceeds of sale of any Securities or against confiscation,
expropriation or nationalization of any securities or the assets
of the issuer of such securities by a government of any foreign
country in which the issuer of such securities is organized or in
which securities are held for safekeeping either by Chase, or any
Chase Branch, Foreign Bank or Foreign Securities Depository in
such country. Chase has discussed the availability of
expropriation insurance with the Trust, and has advised the Trust
as to its understanding of the position of the staff of the
Securities and Exchange Commission that any investment company
investing in securities of foreign issuers has the responsibility
for reviewing the possibility of the imposition of exchange
control restrictions which would affect the liquidity of such
investment company's assets and the possibility of exposure to
political risk, including the appropriateness of insuring against
such risk. The Trust has acknowledged that it has the
responsibility to review the possibility of such risks and what,
if any, action should be taken.
16. Proxy, Notices, Reports, Etc. Chase shall watch
for the dates of expiration of (a) all purchase or sale rights
(including warrants, puts, calls and the like) attached to or
inherent in any of the Securities held in the Custody Account and
(b) conversion rights and conversion price changes for each
convertible Security held in the Custody Account as published in
Telstat Services, Inc., Standard & Poor's Financial Inc. and/or
any other publications listed in the Operating Agreement (it
being understood that Chase may give notice to the Trust as
provided in Section 21 as to any change, addition and/or omission
in the publications watched by Chase for these purposes). If
Chase or any Chase Branch, Foreign Bank or Foreign Securities
Depository shall receive any proxies, notices, reports, or other
communications relative to any of the Securities held in the
Custody Account, Chase shall, on its behalf or on behalf of a
Chase Branch, Foreign Bank or Foreign Securities Depository,
promptly transmit in writing any such communication to the Trust.
In addition, Chase shall notify the Trust by person-to-person
collect telephone concerning any such notices relating to any
matters specified in the first sentence of this Section 16.
As specifically requested by the Trust, Chase shall
execute or deliver or shall cause the nominee in whose name
Securities are registered to execute and deliver to such person
as may be designated by the Trust proxies, consents, authoriza-
tions and any other instruments whereby the authority of the
Trust as owner of any Securities in the Custody Account
registered in the name of Chase or such nominee, as the case may
be, may be exercised. Chase shall vote Securities in accordance
with Written Instructions timely received by Chase, or such other
person or persons as designated in or pursuant to the Operating
Agreement.
Chase and any Chase Branch shall have no liability for
any loss or liability occasioned by delay in the actual receipt
by them or any Foreign Bank or Foreign Securities Depository of
notice of any payment or redemption which does not appear in any
of the publications referred to in the first sentence of this
Section 16.
17. Compensation. The Trust agrees to pay to Chase
from time to time such compensation for its services pursuant to
this Agreement as may be mutually agreed upon in writing from
time to time and Chase's out-of-pocket or incidental expenses, as
from time to time shall be mutually agreed upon by Chase and the
Trust. The Trust shall have no responsibility for the payment of
services provided by any Domestic Securities Depository, such
fees being paid directly by Chase. In the event of any advance
of Cash for any purpose made by Chase pursuant to any Written
Instruction, or in the event that Chase or any nominee of Chase
shall incur or be assessed any taxes in connection with the
performance of this Agreement, the Trust shall indemnify and
reimburse Chase therefor, except such assessment of taxes as
results from the negligence, fraud, or willful misconduct of
Chase, any Domestic Securities Depository, Chase Branch, Foreign
Bank or Foreign Securities Depository, or as constitutes a tax on
income, gross receipts or the like of any one or more of them.
Chase shall have a lien on Securities in the Custody Account and
on Cash in the Deposit Account for any amount owing to Chase from
time to time under this Agreement upon due notice to the Trust.
18. Agreement Subject to Approval of the Trust. It is
understood that this Agreement and any amendments shall be
subject to the approval of the Trust.
19. Term. This Agreement shall remain in effect until
terminated by either party upon 60 days' written notice to the
other, sent by registered mail. Notwithstanding the preceding
sentence, however, if at any time after the execution of this
Agreement Chase shall provide written notice to the Trust, by
registered mail, of the amount needed to meet a substantial
increase in the cost of maintaining its present type and level of
bonding and insurance coverage in connection with Chase's under-
takings in Section 14(a), (d) and (e) of this Agreement, said
Section 14(a), (d) and (e) of this Agreement shall cease to apply
60 days after the providing of such notice by Chase, unless prior
to the expiration of such 60 days the Trust agrees in writing to
assume the amount needed for such purpose. Chase, upon the date
this Agreement terminates pursuant to notice which has been given
in a timely fashion, shall, and/or shall cause each Domestic
Securities Depository to, deliver the Securities in the Custody
Account, pay the Cash in the Deposit Account, and deliver and pay
Securities and Cash in the Segregated Account to the Trust unless
Chase has received from the Trust 60 days prior to the date on
which this Agreement is to be terminated Written Instructions
specifying the name(s) of the person(s) to whom the Securities in
the Custody Account shall be delivered, the Cash in the Deposit
Account shall be paid, and Securities and Cash in the Segregated
Account shall be delivered and paid. Concurrently with the
delivery of such Securities, Chase shall deliver to the Trust, or
such other person as the Trust shall instruct, the records
referred to in Section 11 which are in the possession or control
of Chase, any Chase Branch, or any Domestic Securities Deposi-
tory, or any Foreign Bank or Foreign Securities Depository, or in
the event that Chase is unable to obtain such records in their
original form Chase shall deliver true copies of such records.
20. Authorization of Chase to Execute Necessary
Documents. In connection with the performance of its duties
hereunder, the Trust hereby authorizes and directs Chase and each
Chase Branch acting on behalf of Chase, and Chase hereby agrees,
to execute and deliver in the name of the Trust, or cause such
other Chase Branch to execute and deliver in the name of the
Trust, such certificates, instruments, and other documents as
shall be reasonably necessary in connection with such
performance, provided that the Trust shall have furnished to
Chase any information necessary in connection therewith.
21. Notices. Any notice or other communication
authorized or required by this Agreement to be given to the
parties shall be sufficiently given (except to the extent
otherwise specifically provided) if addressed and mailed postage
prepaid or delivered to it at its office at the address set forth
below:
If to the Trust, then to
Templeton Global Investment Trust
700 Central Avenue, P.O. Box 33030
St. Petersburg, Florida 33733
Attention: Thomas M. Mistele, Secretary
If to Chase, then to
The Chase Manhattan Bank, N.A.
MetroTech Center
Brooklyn, New York 11245
Attention: Global Custody Division Executive
or such other person or such other address as any party shall
have furnished to the other party in writing.
22. Non-Assignability of Agreement. This Agreement
shall not be assignable by either party hereto; provided,
however, that any corporation into which the Trust or Chase, as
the case may be, may be merged or converted or with which it may
be consolidated, or any corporation succeeding to all or
substantially all of the trust business of Chase, shall succeed
to the respective rights and shall assume the respective duties
of the Trust or of Chase, as the case may be, hereunder.
23. Governing Law. This Agreement shall be governed
by the laws of the State of New York.
THE CHASE MANHATTAN BANK, N.A.
By:__________________________________
TEMPLETON GLOBAL INVESTMENT TRUST
By:__________________________________
Exhibit (9)(A)
Amended and Restated Business Management Agreement
<PAGE>
BUSINESS MANAGEMENT AGREEMENT BETWEEN
TEMPLETON GLOBAL INVESTMENT TRUST AND
TEMPLETON GLOBAL INVESTORS, INC.
AGREEMENT dated as of March 14, 1994 and amended as of
June 27, 1994 and May __, 1995, between Templeton Global
Investment Trust, a Delaware business trust which is a registered
open-end investment company (the "Trust"), comprising five
series, Templeton Global Rising Dividends Fund, Templeton Global
Infrastructure Fund, Templeton Americas Government Securities
Fund, Templeton Greater European Fund, and Templeton Latin
America Fund (collectively, the "Funds"), and Templeton Global
Investors, Inc. ("TGI").
In consideration of the mutual promises herein made,
the parties hereby agree as follows:
(1) TGI agrees, during the life of this Agreement, to
be responsible for:
(a) providing office space, telephone, office
equipment and supplies for the Trust;
(b) paying compensation of the Trust's officers for
services rendered as such;
(c) authorizing expenditures and approving bills for
payment on behalf of the Trust;
(d) supervising preparation of annual and semiannual
reports to Shareholders, notices of dividends,
capital gains distributions and tax credits, and
attending to routine correspondence and other
communications with individual Shareholders;
(e) daily pricing of the Funds' investment portfolios
and preparing and supervising publication of daily
quotations of the bid and asked prices of the
Funds' Shares, earnings reports and other
financial data;
(f) monitoring relationships with organizations
serving the Trust, including custodians, transfer
agents and printers;
(g) providing trading desk facilities for the Trust;
(h) supervising compliance by the Trust with
recordkeeping requirements under the Investment
Company Act of 1940 (the "1940 Act") and the rules
and regulations thereunder, with state regulatory
requirements, maintenance of books and records for
the Trust (other than those maintained by the
custodian and transfer agent), preparing and
filing of tax reports other than the Trust's
income tax returns;
(i) monitoring the qualifications of tax deferred
retirement plans providing for investment in
Shares of the Funds; and
(j) providing executive, clerical and secretarial
personnel needed to carry out the above
responsibilities.
(2) The Trust agrees, during the life of this
Agreement, to pay to TGI as compensation for the foregoing a
monthly fee equal on an annual basis to 0.15% of the first $200
million of the aggregate average daily net assets of the Funds
during the month preceding each payment, reduced as follows: on
such net assets in excess of $200 million up to $700 million, a
monthly fee equal on an annual basis to 0.135%; on such net
assets in excess of $700 million up to $1.2 billion, a monthly
fee equal on an annual basis to 0.10%; and on such net assets in
excess of $1.2 billion, a monthly fee equal on an annual basis to
0.075%.
(3) This Agreement shall remain in full force and
effect through July 31, 1995 and thereafter from year to year to
the extent continuance is approved annually by the Board of
Trustees of the Trust.
(4) This Agreement may be terminated by the Trust at
any time on sixty (60) days' written notice without payment of
penalty, provided that such termination by the Trust shall be
directed or approved by the vote of a majority of the Trustees of
the Trust in office at the time or by the vote of a majority of
the outstanding voting securities of the Funds (as defined by the
1940 Act); and shall automatically and immediately terminate in
the event of its assignment (as defined by the 1940 Act).
(5) In the absence of willful misfeasance, bad faith
or gross negligence on the part of TGI, or of reckless disregard
of its duties and obligations hereunder, TGI shall not be subject
to liability for any act or omission in the course of, or
connected with, rendering services hereunder.
(6) TGI has advanced for the account of the Funds all
organizational expenses of the Trust, all of which expenses are
being deferred by the Trust and amortized ratably over a five-
year period commencing on March 14, 1994; and during the
amortization period, the proceeds of any redemption of the
original Shares will be reduced by a pro rata portion of any then
unamortized organizational expenses based on the ratio of the
Shares redeemed to the total initial Shares outstanding
immediately prior to the redemption.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their duly authorized officers
and their respective corporate seals to be hereunto duly affixed
and attested.
TEMPLETON GLOBAL INVESTMENT TRUST
By:
ATTEST:
___________________________
TEMPLETON GLOBAL INVESTORS, INC.
By:
ATTEST:
___________________________
Exhibit (9)(B)
Amended and Restated Transfer Agent Agreement
<PAGE>
TRANSFER AGENT AGREEMENT BETWEEN
TEMPLETON GLOBAL INVESTMENT TRUST AND
FRANKLIN TEMPLETON INVESTOR SERVICES, INC.
AGREEMENT dated as of March 14, 1994 and amended and
restated June 27, 1994 and May __, 1995 between TEMPLETON GLOBAL
INVESTMENT TRUST, a registered open-end investment company with
offices at 700 Central Avenue, St. Petersburg, Florida 33701 (the
"Trust"), and FRANKLIN TEMPLETON INVESTOR SERVICES, INC., a
registered transfer agent with offices at 700 Central Avenue, St.
Petersburg, Florida 33701 ("FTIS").
W I T N E S E T H:
That for and in consideration of the mutual promises
hereinafter set forth, the Trust on behalf of Templeton Global
Infrastructure Fund, Templeton Global Rising Dividends Fund,
Templeton Americas Government Securities Fund, Templeton Greater
European Fund, and Templeton Latin America Fund (each a "Fund",
and collectively the "Funds") and FTIS agree as follows:
1. Definitions. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise
requires, shall have the following meanings:
(a) "Declaration of Trust" shall mean the Declaration
of Trust of the Trust as the same may be amended from time to
time;
(b) "Authorized Person" shall be deemed to include any
person, whether or not such person is an officer or employee of
the Trust, duly authorized to give Oral Instructions or Written
Instructions on behalf of the Trust as indicated in a certificate
furnished to FTIS pursuant to Section 4(c) hereof as may be
received by FTIS from time to time;
(c) "Custodian" refers to the custodian and any sub-
custodian of all securities and other property which each Fund
may from time to time deposit, or cause to be deposited or held
under the name or account of such custodian pursuant to the
Custody Agreement;
(d) "Oral Instructions" shall mean instructions, other
than written instructions, actually received by FTIS from a
person reasonably believed by FTIS to be an Authorized Person;
(e) "Shares" refers to shares of beneficial interest,
par value $.01 per share, of each Fund; and
(f) "Written Instructions" shall mean a written
communication signed by a person reasonably believed by FTIS to
be an Authorized Person and actually received by FTIS.
2. Appointment of FTIS. The Trust on behalf of the Funds
hereby appoints and constitutes FTIS as transfer agent for Shares
of each Fund and as shareholder servicing agent for each Fund,
and FTIS accepts such appointment and agrees to perform the
duties hereinafter set forth.
3. Compensation. ____________
(a) Each Fund will compensate or cause FTIS to be
compensated for the performance of its obligations hereunder in
accordance with the fees set forth in the written schedule of
fees annexed hereto as Schedule A and incorporated herein.
Schedule A does not include out-of-pocket disbursements of FTIS
for which FTIS shall be entitled to bill each Fund separately.
FTIS will bill each Fund as soon as practicable after the end of
each calendar month, and said billings will be detailed in
accordance with Schedule A. Each Fund will promptly pay to FTIS
the amount of such billing.
Out-of-pocket disbursements shall include, but shall
not be limited to, the items specified in the written schedule of
out-of-pocket expenses annexed hereto as Schedule B and
incorporated herein. Schedule B may be modified by FTIS upon not
less than 30 days' prior written notice to the Trust.
Unspecified out-of-pocket expenses shall be limited to those out-
of-pocket expenses reasonably incurred by FTIS in the performance
of its obligations hereunder. Reimbursement by each Fund for
expenses incurred by FTIS in any month shall be made as soon as
practicable after the receipt of an itemized bill from FTIS.
(b) Any compensation agreed to hereunder may be
adjusted from time to time by attaching to Schedule A of this
Agreement a revised Fee Schedule.
4. Documents. In connection with the appointment of FTIS,
each Fund shall, on or before the date this Agreement goes into
effect, but in any case, within a reasonable period of time for
FTIS to prepare to perform its duties hereunder, deliver or cause
to be delivered to FTIS the following documents:
(a) If applicable, specimens of the certificates for
Shares of each Fund;
(b) All account application forms and other documents
relating to Shareholder accounts or to any plan, program or
service offered by each Fund;
(c) A certificate identifying the Authorized Persons
and specimen signatures of Authorized Persons who will sign
Written Instructions; and
(d) All documents and papers necessary under the laws
of Florida, under the Trust's Declaration of Trust, and as may be
required for the due performance of FTIS's duties under this
Agreement or for the due performance of additional duties as may
from time to time be agreed upon between the Trust and FTIS.
5. Distributions Payable in Shares. In the event that the
Board of Trustees of the Trust shall declare a distribution
payable in Shares, the Trust shall deliver or cause to be
delivered to FTIS written notice of such declaration signed on
behalf of the Trust by an officer thereof, upon which FTIS shall
be entitled to rely for all purposes, certifying (i) the number
of Shares involved, and (ii) that all appropriate action has been
taken.
6. Duties of the Transfer Agent. FTIS shall be
responsible for administering and/or performing transfer agent
functions; for acting as service agent in connection with
dividend and distribution functions; and for performing
shareholder account and administrative agent functions in
connection with the issuance, transfer and redemption or
repurchase (including coordination with the Custodian) of Shares.
The operating standards and procedures to be followed shall be
determined from time to time by agreement between the Trust and
FTIS. Without limiting the generality of the foregoing, FTIS
agrees to perform the specific duties listed on Schedule C.
7. Recordkeeping and Other Information. FTIS shall create
and maintain all necessary records in accordance with all
applicable laws, rules and regulations.
8. Other Duties. In addition, FTIS shall perform such
other duties and functions, and shall be paid such amounts
therefor, as may from time to time be agreed upon in writing
between the Trust and FTIS. Such other duties and functions
shall be reflected in a written amendment to Schedule C, and the
compensation for such other duties and functions shall be
reflected in a written amendment to Schedule A.
9. Reliance by Transfer Agent; Instructions.
(a) FTIS will be protected in acting upon Written or
Oral Instructions reasonably believed to have been executed or
orally communicated by an Authorized Person and will not be held
to have any notice of any change of authority of any person until
receipt of a Written Instruction thereof from an officer of the
Trust. FTIS will also be protected in processing Share
certificates which it reasonably believes to bear the proper
manual or facsimile signatures of the officers of the Trust and
the proper countersignature of FTIS.
(b) At any time FTIS may apply to any Authorized
Person of the Trust's for Written Instructions and may seek
advice at the Trust's expense from legal counsel for the Trust or
from its own legal counsel, with respect to any matter arising in
connection with this Agreement, and it shall not be liable for
any action taken or not taken or suffered by it in good faith in
accordance with such Written Instructions or in accordance with
the opinion of counsel for the Trust or for FTIS. Written
Instructions requested by FTIS will be provided by the Trust
within a reasonable period of time. In addition, FTIS, or its
officers, agents or employees, shall accept Oral Instructions or
Written Instructions given to them by any person representing or
acting on behalf of either Fund only if said representative is
known by FTIS, or its officers, agents or employees, to be an
Authorized Person.
10. Acts of God, etc. FTIS will not be liable or
responsible for delays or errors by reason of circumstances
beyond its control, including acts of civil or military
authority, national emergencies, labor difficulties, fire,
mechanical breakdown beyond its control, flood or catastrophe,
acts of God, insurrection, war, riots or failure beyond its
control of transportation, communication or power supply.
11. Term and Termination.
(a) This Agreement shall be effective as of the date
first written above and shall continue until July 31, 1995 and
thereafter shall continue automatically for successive annual
periods ending on July 31st of each year, provided such
continuance is specifically approved at least annually by (i) the
Trust's Board of Trustees or (ii) a vote of a "majority" (as
defined in the Investment Company Act of 1940 (the "1940 Act"))
of each Fund's outstanding voting securities, provided that in
either event the continuance is also approved by a majority of
the Board of Trustees who are not "interested persons" (as
defined in the 1940 Act) of any party to this Agreement, by vote
cast in person at a meeting called for the purpose of voting such
approval.
(b) Either party hereto may terminate this Agreement
by giving to the other party a notice in writing specifying the
date of such termination, which shall be not less than 60 days
after the date of receipt of such notice. In the event such
notice is given by the Trust, it shall be accompanied by a
resolution of the Board of Trustees of the Trust, certified by
the Secretary of the Trust, designating a successor transfer
agent or transfer agents. Upon such termination and at the
expense of the Trust, FTIS will deliver to such successor a
certified list of Shareholders of the Funds (with names and
addresses), an historical record of the account of each
Shareholder and the status thereof, and all other relevant books,
records, correspondence, and other data established or maintained
by FTIS under this Agreement in a form reasonably acceptable to
the Trust, and will cooperate in the transfer of such duties and
responsibilities, including provisions for assistance from FTIS's
personnel in the establishment of books, records and other data
by such successor or successors.
12. Amendment. This Agreement may not be amended or
modified in any manner except by a written agreement executed by
both parties.
13. Subcontracting. The Trust agrees that FTIS may, in its
discretion, subcontract for certain of the services described
under this Agreement or the Schedules hereto; provided that the
appointment of any such agent shall not relieve FTIS of its
responsibilities hereunder.
14. Miscellaneous.
(a) Any notice or other instrument authorized or
required by this Agreement to be given in writing to the Trust or
FTIS shall be sufficiently given if addressed to that party and
received by it at its office set forth below or at such other
place as it may from time to time designate in writing.
To the Trust:
Templeton Global Investment Trust
700 Central Avenue
St. Petersburg, Florida 33701
To FTIS:
Franklin Templeton Investor Services, Inc.
700 Central Avenue
St. Petersburg, Florida 33701
(b) This Agreement shall extend to and shall be binding
upon the parties hereto, and their respective successors and
assigns; provided, however, that this Agreement shall not be
assignable without the written consent of the other party.
(c) This Agreement shall be construed in accordance
with the laws of the State of Florida.
(d) This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original;
but such counterparts shall, together, constitute only one
instrument.
(e) The captions of this Agreement are included for
convenience of reference only and in no way define or delimit any
of the provisions hereof or otherwise affect their construction
or effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective corporate officers
thereunder duly authorized as of the day and year first above
written.
TEMPLETON GLOBAL INVESTMENT TRUST
BY: _______________________________
ATTEST:
___________________________
FRANKLIN TEMPLETON INVESTOR SERVICES,
INC.
BY: _______________________________
ATTEST:
___________________________
Schedule A
FEES ____
Shareholder account $13.42, adjusted as of
maintenance (per annum, February 1 of each year to
prorated payable monthly) reflect changes in the
Department of Labor Consumer
Price Index.
Cash withdrawal program No charge to the Funds.
Retirement Plans No charge to the Funds
($10.00 annual maintenance
charge is applied against
each Plan account).
Wire orders of redemptions No charge to the Funds
or express mailing of ($15.00 fee is deducted for
redemption proceeds each order).
June __, 1994
Schedule B
OUT-OF-POCKET EXPENSES ______________________
The Funds shall reimburse FTIS monthly for the following
out-of-pocket expenses:
o postage and mailing
o forms
o outgoing wire charges
o telephone
o Federal Reserve charges for check clearance
o if applicable, magnetic tape and freight
o retention of records
o microfilm/microfiche
o stationery
o insurance
o if applicable, terminals, transmitting lines and any
expenses incurred in connection with such terminals and
lines
o all other miscellaneous expenses reasonably incurred by
FTIS
The Funds agree that postage and mailing expenses will be
paid on the day of or prior to mailing as agreed with FTIS. In
addition, the Funds will promptly reimburse FTIS for any other
expenses incurred by FTIS as to which the Funds and FTIS mutually
agree that such expenses are not otherwise properly borne by FTIS
as part of its duties and obligations under the Agreement.
Schedule C
DUTIES ______
AS TRANSFER AGENT FOR INVESTORS IN THE TRUST, FTIS WILL:
o Record in its transfer record, countersign as transfer
agent, and deliver certificates signed manually or by
facsimile, by the President or a Vice-President and by
the Secretary or the Treasurer of the Trust, in such
names and for such number of authorized but hitherto
unissued Shares of the Funds as to which FTIS shall
receive instructions; and
o Transfer on its records from time to time, when
presented to it for that purpose, certificates of said
Shares, whether now outstanding or hereafter issued,
when countersigned by a duly authorized transfer agent,
and upon the cancellation of the old certificates,
record and countersign new certificates for a
corresponding aggregate number of Shares and deliver
said new certificates.
AS SHAREHOLDER SERVICE AGENT FOR INVESTORS IN THE FUNDS, FTIS
WILL:
o Receive from the Funds, from the Trust's Principal
Underwriter or from a Shareholder, on a form acceptable
to FTIS, information necessary to record sales and
redemptions and to generate sale and/or redemption
confirmations;
o Mail sale and/or redemption confirmations using
standard forms;
o Accept and process cash payments from investors, and
clear checks which represent payments for the purchase
of Shares;
o Requisition Shares in accordance with instructions of
the Principal Underwriter of the Shares of the Funds;
o Produce periodic reports reflecting the accounts
receivable and the paid pending (free stock) items;
o Open, maintain and close Shareholder accounts;
o Establish registration of ownership of Shares in
accordance with generally accepted form;
o Maintain monthly records of (i) issued Shares and (ii)
number of Shareholders and their aggregate
Shareholdings classified according to their residence
in each State of the United States or foreign country;
o Accept and process telephone exchanges for Shares in
accordance with the Funds' Telephone Exchange Privilege
as described in the each Fund's current prospectus;
o Maintain and safeguard records for each Shareholder
showing name(s), address, number of any certificates
issued, and number of Shares registered in such
name(s), together with continuous proof of the
outstanding Shares, and dealer identification, and
reflecting all current changes; on request, provide
information as to an investor's qualification for
Cumulative Quantity Discount; and provide all accounts
with year-to-date and year-end historical confirmation
statements;
o Provide on request a duplicate set of records for file
maintenance in the Trust's office in St. Petersburg,
Florida;
o Out of money received in payment for Share sales, pay
to the Trust's Custodian Account with the Custodian,
the net asset value per Share and pay to the Principal
Underwriter its commission;
o Redeem Shares and prepare and mail liquidation checks;
o Pass upon the adequacy of documents submitted by a
Shareholder or his legal representative to substantiate
the transfer of ownership of Shares from the registered
owner to transferees;
o From time to time, make transfers upon the books of the
Funds in accordance with properly executed transfer
instructions furnished to FTIS and make transfers of
certificates for such Shares as may be surrendered for
transfer properly endorsed, and countersign new
certificates issued in lieu thereof;
o Upon receipt of proper documentation, place stop
transfers, obtain necessary insurance forms, and
reissue replacement certificates against lost, stolen
or destroyed Share certificates;
-C2-
o Check surrendered certificates for stop transfer
restrictions. Although FTIS cannot insure the
genuineness of certificates surrendered for
cancellation, it will employ all due reasonable care in
deciding the genuineness of such certificates and the
guarantor of the signature(s) thereon;
o Cancel surrendered certificates and record and
countersign new certificates;
o Certify outstanding Shares to auditors;
o In connection with any meeting of Shareholders, upon
receiving appropriate detailed instructions and written
materials prepared by the Funds and proxy proofs
checked by the Trust, print proxy cards; deliver to
Shareholders all reports, prospectuses, proxy cards and
related proxy materials of suitable design for
enclosing; receive and tabulate executed proxies; and
furnish a list of Shareholders for the meeting;
o Answer routine correspondence and telephone inquiries
about individual accounts; prepare monthly reports for
correspondence volume and correspondence data necessary
for the Trust's Semi-Annual Report on Form N-SAR;
o Prepare and mail dealer commission statements and
checks;
o Maintain and furnish each Fund and its Shareholders
with such information as each Fund may reasonably
request for the purpose of compliance by the Trust with
the applicable tax and securities laws of applicable
jurisdictions;
o Mail confirmations of transactions to investors and
dealers in a timely fashion;
o Pay or reinvest income dividends and/or capital gains
distributions to Shareholders of record, in accordance
with the Funds' and/or Shareholder's instructions,
provided that:
(a) Each Fund shall notify FTIS in writing
promptly upon declaration of any such
dividend and/or distribution, and in any
-C3-
event at least forty-eight (48) hours before
the record date;
(b) Such notification shall include the
declaration date, the record date, the
payable date, the rate, and, if applicable,
the reinvestment date and the reinvestment
price to be used; and
(c) Prior to the payable date, each Fund shall
furnish FTIS with sufficient fully and
finally collected funds to make such
distribution.
o Prepare and file annual United States information
returns of dividends and capital gains distributions
(Form 1099) and mail payee copies to Shareholders;
report and pay United States income taxes withheld from
distributions made to nonresidents of the United
States; and prepare and mail to Shareholders the notice
required by the U.S. Internal Revenue Code as to
realized capital gains distributed and/or retained, and
their proportionate share of any foreign taxes paid by
the Funds;
o Prepare transfer journals;
o Set up wire order trades on file;
o Receive payment for trades and update the trade file;
o Produce delinquency and other trade file reports;
o Provide dealer commission statements and payments
thereof for the Principal Underwriter;
o Sort and print Shareholder information by state, social
code, price break, etc.; and
o Mail promptly the Statement of Additional Information
of the Trust to each Shareholder who requests it, at no
cost to the Shareholder.
In connection with the Trust's Cash Withdrawal Program, FTIS
will:
-C4-
o Make payment of amounts withdrawn periodically by the
Shareholder pursuant to the Program by redeeming
Shares, and confirm such redemptions to the
Shareholder; and
o Provide confirmations of all redemptions, reinvestment
of dividends and distributions, and any additional
investments in the Program, including a summary
confirmation at the year-end.
In connection with Tax Deferred Retirement Plans involving
the Funds, FTIS will:
o Receive and process applications, accept contributions,
record Shares issued and dividends reinvested;
o Make distributions when properly requested; and
o Furnish reports to regulatory authorities as required.
-C5-
Exhibit (11)
Consent of Independent Public Accountants
<PAGE>
McGLADREY & PULLEN
Certified Public Accountants and Consultants
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the use of our report dated March 11, 1994
on the financial statements of Templeton Global Rising Dividends
Fund and Templeton Global Infrastructure Fund, series of
Templeton Global Investment Trust referred to therein in Post-
Effective Amendment No. 4 to the Registration Statement on Form
N-1A, File No. 33-73244, as filed with the Securities and
Exchange Commission.
McGLADREY & PULLEN
New York, New York
February 16, 1995
Exhibit (15)(D)(i)
Distribution Plan -
Templeton Greater European Fund Class I
<PAGE>
DISTRIBUTION PLAN
WHEREAS, Templeton Global Investment Trust (the
"Trust") is registered as an open-end diversified management
investment company under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust on behalf of Templeton Greater
European Fund (the "Fund") and Franklin Templeton Distributors,
Inc. (the "Selling Company"), a wholly owned subsidiary of
Franklin Resources, Inc. and a broker-dealer registered under the
Securities Exchange Act of 1934, have entered into a Distribution
Agreement pursuant to which the Selling Company will act as
principal underwriter of the Class I Shares of the Fund for sale
to the public; and
WHEREAS, shares of common stock of the Fund are divided
into classes of shares, one of which is designated Class I;
WHEREAS, the Board of Trustees of the Trust has
determined to adopt this Distribution Plan (the "Plan"), in
accordance with the requirements of the 1940 Act and has
determined that there is a reasonable likelihood that the Plan
will benefit the Fund and the holders of Class I Shares.
NOW THEREFORE, the Trust on behalf of the Fund hereby
adopts, with respect to its Class I Shares, the Plan on the
following terms and conditions:
1. The Fund will reimburse the Selling Company for
costs and expenses incurred in connection with the distribution
and marketing of the Class I Shares of the Fund. Such
distribution costs and expenses may include: (a) payments to
broker-dealers who provide certain services of value to the
Fund's Class I Shareholders (sometimes referred to as a "trail
fee"); (b) reimbursement of expenses relating to selling and
servicing efforts or of organizing and conducting sales seminars;
(c) payments to employees or agents of the Selling Company who
engage in or support distribution of the Class I Shares; (d)
payment of the costs of preparing, printing and distributing
prospectuses and reports to prospective investors and of printing
and advertising expenses; (e) payment of dealer commissions and
wholesaler compensation in connection with sales of the Fund's
Class I Shares exceeding $1 million (for which the Trust imposes
no sales charge) and interest or carrying charges in connection
therewith; and (f) such other similar services as the Trust's
Board of Trustees determines to be reasonably calculated to
result in the sale of Class I Shares.
The Selling Company will be reimbursed for such costs,
expenses or payments on a monthly basis, subject to a limit of
0.35% per annum of the average daily net assets of the Fund's
Class I Shares. Payments made out of or charged against the
assets of the Class I Shares of the Fund must be in reimbursement
for costs and expenses in connection with any activity which is
primarily intended to result in the sale of the Fund's Class I
Shares. The costs and expenses not reimbursed in any one given
month (including costs and expenses not reimbursed because they
exceeded the limit of 0.35% per annum of the average daily net
assets of the Fund's Class I Shares) may be reimbursed in
subsequent months or years.
2. The Plan shall not take effect with respect to the
Fund's Class I Shares until it has been approved by a vote of at
least a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Class I Shares of the Fund. With
respect to the submission of the Plan for such a vote, it shall
have been effectively approved with respect to the Fund's Class I
Shares if a majority of the outstanding voting securities of the
Class I Shares of the Fund votes for approval of the Plan.
3. The Plan shall not take effect until it has been
approved, together with any related agreements and supplements,
by votes of a majority of both (a) the Board of Trustees of the
Trust, and (b) those Trustees of the Trust who are not
"interested persons" (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of the
Plan or any agreements related to it (the "Plan Trustees"), cast
in person at a meeting (or meetings) called for the purpose of
voting on the Plan and such related agreements.
4. The Plan shall continue in effect so long as such
continuance is specifically approved at least annually in the
manner provided for approval of the Plan in paragraph 3.
5. Any person authorized to direct the disposition of
monies paid or payable by the Class I Shares of the Fund pursuant
to the Plan or any related agreement shall provide to the Trust's
Board of Trustees, and the Board shall review, at least
quarterly, a written report of the amounts so expended and the
purposes for which such expenditures were made.
6. Any agreement related to the Plan shall be in
writing and shall provide: (a) that such agreement may be
terminated at any time as to the Fund's Class I Shares, without
payment of any penalty, by vote of a majority of the Plan
Trustees or by vote of a majority of the outstanding voting
securities of the Class I Shares of the Fund, on not more than
sixty days' written notice to any other party to the agreement;
and (b) that such agreement shall terminate automatically in the
event of its assignment.
7. The Plan may be terminated at any time, without
payment of any penalty, by vote of a majority of the Plan
Trustees, or by vote of a majority of the outstanding Class I
Shares of the Fund.
8. The Plan may be amended at any time by the Trust's
Board of Trustees, provided that (a) any amendment to increase
materially the costs which the Class I Shares of the Fund may
bear for distribution pursuant to the Plan shall be effective
only upon approval by a vote of a majority of the Class I Shares
of the Fund, and (b) any material amendments of the terms of the
Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and
nomination of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund shall be committed to the
discretion of the Trustees who are not interested persons.
10. The Trust shall preserve copies of the Plan, any
related agreement and any report made pursuant to paragraph 5
hereof, for a period of not less than six years from the date of
the Plan, such agreement or report, as the case may be, the first
two years of which shall be in an easily accessible place.
11. It is understood and expressly stipulated that
neither the holders of Class I Shares of the Fund nor any
Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the Trust has executed this
Distribution Plan on this ___ day of May, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
on behalf of TEMPLETON GREATER EUROPEAN FUND
By: _______________________________
John R. Kay
Vice President
Attest:
_______________________
Thomas M. Mistele
Secretary
Exhibit (15)(D)(ii)
Distribution Plan -
Templeton Greater European Fund Class II
<PAGE>
DISTRIBUTION PLAN
WHEREAS, Templeton Global Investment Trust (the
"Trust") is registered as an open-end diversified management
investment company under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust on behalf of Templeton Greater
European Fund (the "Fund") and Franklin Templeton Distributors,
Inc. (the "Selling Company"), a wholly owned subsidiary of
Franklin Resources, Inc. and a broker-dealer registered under the
Securities Exchange Act of 1934, have entered into a Distribution
Agreement pursuant to which the Selling Company will act as
principal underwriter of the Class II Shares of the Fund for sale
to the public; and
WHEREAS, shares of common stock of the Fund are divided
into classes of shares, one of which is designated Class II;
WHEREAS, the Board of Trustees of the Trust has
determined to adopt this Distribution Plan (the "Plan"), in
accordance with the requirements of the 1940 Act and has
determined that there is a reasonable likelihood that the Plan
will benefit the Fund and the holders of Class II Shares.
NOW THEREFORE, the Trust on behalf of the Fund hereby
adopts, with respect to its Class II Shares, the Plan on the
following terms and conditions:
1. The Fund will reimburse the Selling Company for
costs and expenses incurred in connection with the distribution
and marketing of the Class II Shares of the Fund. Such
distribution costs and expenses may include: (a) payments to
broker-dealers who provide certain services of value to the
Fund's Class II Shareholders (sometimes referred to as a "trail
fee"); (b) reimbursement of expenses relating to selling and
servicing efforts or of organizing and conducting sales seminars;
(c) payments to employees or agents of the Selling Company who
engage in or support distribution of the Class II Shares; (d)
payment of the costs of preparing, printing and distributing
prospectuses and reports to prospective investors and of printing
and advertising expenses; (e) payment of dealer commissions and
wholesaler compensation in connection with sales of the Fund's
Class II Shares exceeding $1 million (for which the Trust imposes
no sales charge) and interest or carrying charges in connection
therewith; and (f) such other similar services as the Trust's
Board of Trustees determines to be reasonably calculated to
result in the sale of Class II Shares.
The Selling Company will be reimbursed for such costs,
expenses or payments on a monthly basis, subject to an annual
limit of 1.00% per annum of the average daily net assets of the
Fund's Class II Shares (of which up to 0.25% of such net assets
may be paid to dealers for personal service and/or the
-9-
maintenance of Class II Shareholder accounts (the "Service Fee"))
and subject to any applicable restriction imposed by rules of the
National Association of Securities Dealers, Inc. Payments made
out of or charged against the assets of the Class II Shares of
the Fund must be in reimbursement for costs and expenses in
connection with any activity which is primarily intended to
result in the sale of the Fund's Class II Shares or account
maintenance and personal service to Shareholders. The costs and
expenses not reimbursed in any one given month (including costs
and expenses not reimbursed because they exceeded the limit of
1.00% per annum of the average daily net assets of the Fund's
Class II Shares) may be reimbursed in subsequent months or years.
2. The Plan shall not take effect with respect to the
Fund's Class II Shares until it has been approved by a vote of at
least a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Class II Shares of the Fund. With
respect to the submission of the Plan for such a vote, it shall
have been effectively approved with respect to the Fund's Class
II Shares if a majority of the outstanding voting securities of
the Class II Shares of the Fund votes for approval of the Plan.
3. The Plan shall not take effect until it has been
approved, together with any related agreements and supplements,
by votes of a majority of both (a) the Board of Trustees of the
-10-
Trust, and (b) those Trustees of the Trust who are not
"interested persons" (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of the
Plan or any agreements related to it (the "Plan Trustees"), cast
in person at a meeting (or meetings) called for the purpose of
voting on the Plan and such related agreements.
4. The Plan shall continue in effect so long as such
continuance is specifically approved at least annually in the
manner provided for approval of the Plan in paragraph 3.
5. Any person authorized to direct the disposition of
monies paid or payable by the Class II Shares of the Fund
pursuant to the Plan or any related agreement shall provide to
the Trust's Board of Trustees, and the Board shall review, at
least quarterly, a written report of the amounts so expended and
the purposes for which such expenditures were made.
6. Any agreement related to the Plan shall be in
writing and shall provide: (a) that such agreement may be
terminated at any time as to the Fund's Class II Shares, without
payment of any penalty, by vote of a majority of the Plan
Directors or by vote of a majority of the outstanding voting
securities of the Class II Shares of the Fund, on not more than
sixty days' written notice to any other party to the agreement;
-11-
and (b) that such agreement shall terminate automatically in the
event of its assignment.
7. The Plan may be terminated at any time, without
payment of any penalty, by vote of a majority of the Plan
Trustees, or by vote of a majority of the outstanding Class II
Shares of the Fund.
8. The Plan may be amended at any time by the Trust's
Board of Trustees, provided that (a) any amendment to increase
materially the costs which the Class II Shares of the Fund may
bear for distribution pursuant to the Plan shall be effective
only upon approval by a vote of a majority of the Class II Shares
of the Fund, and (b) any material amendments of the terms of the
Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and
nomination of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Trust shall be committed to the
discretion of the Trustees who are not interested persons.
10. The Fund shall preserve copies of the Plan, any
related agreement and any report made pursuant to paragraph 5
hereof, for a period of not less than six years from the date of
-12-
the Plan, such agreement or report, as the case may be, the first
two years of which shall be in an easily accessible place.
11. It is understood and expressly stipulated that
neither the holders of Class II Shares of the Fund nor any
Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the Trust has executed this
Distribution Plan on this ___ day of May, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
on behalf of TEMPLETON GREATER EUROPEAN FUND
By: _______________________________
John R. Kay
Vice President
Attest:
_______________________
Thomas M. Mistele
Secretary
Exhibit (15)(E)(i)
Distribution Plan -
Templeton Latin America Fund Class I
<PAGE>
DISTRIBUTION PLAN
WHEREAS, Templeton Global Investment Trust (the
"Trust") is registered as an open-end diversified management
investment company under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust on behalf of Templeton Latin America
Fund (the "Fund") and Franklin Templeton Distributors, Inc. (the
"Selling Company"), a wholly owned subsidiary of Franklin
Resources, Inc. and a broker-dealer registered under the
Securities Exchange Act of 1934, have entered into a Distribution
Agreement pursuant to which the Selling Company will act as
principal underwriter of the Class I Shares of the Fund for sale
to the public; and
WHEREAS, shares of common stock of the Fund are divided
into classes of shares, one of which is designated Class I;
WHEREAS, the Board of Trustees of the Trust has
determined to adopt this Distribution Plan (the "Plan"), in
accordance with the requirements of the 1940 Act and has
determined that there is a reasonable likelihood that the Plan
will benefit the Fund and the holders of Class I Shares.
NOW THEREFORE, the Trust on behalf of the Fund hereby
adopts, with respect to its Class I Shares, the Plan on the
following terms and conditions:
1. The Fund will reimburse the Selling Company for
costs and expenses incurred in connection with the distribution
and marketing of the Class I Shares of the Fund. Such
distribution costs and expenses may include: (a) payments to
broker-dealers who provide certain services of value to the
Fund's Class I Shareholders (sometimes referred to as a "trail
fee"); (b) reimbursement of expenses relating to selling and
servicing efforts or of organizing and conducting sales seminars;
(c) payments to employees or agents of the Selling Company who
engage in or support distribution of the Class I Shares; (d)
payment of the costs of preparing, printing and distributing
prospectuses and reports to prospective investors and of printing
and advertising expenses; (e) payment of dealer commissions and
wholesaler compensation in connection with sales of the Fund's
Class I Shares exceeding $1 million (for which the Trust imposes
no sales charge) and interest or carrying charges in connection
therewith; and (f) such other similar services as the Trust's
Board of Trustees determines to be reasonably calculated to
result in the sale of Class I Shares.
The Selling Company will be reimbursed for such costs,
expenses or payments on a monthly basis, subject to a limit of
0.35% per annum of the average daily net assets of the Fund's
Class I Shares. Payments made out of or charged against the
assets of the Class I Shares of the Fund must be in reimbursement
-16-
for costs and expenses in connection with any activity which is
primarily intended to result in the sale of the Fund's Class I
Shares. The costs and expenses not reimbursed in any one given
month (including costs and expenses not reimbursed because they
exceeded the limit of 0.35% per annum of the average daily net
assets of the Fund's Class I Shares) may be reimbursed in
subsequent months or years.
2. The Plan shall not take effect with respect to the
Fund's Class I Shares until it has been approved by a vote of at
least a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Class I Shares of the Fund. With
respect to the submission of the Plan for such a vote, it shall
have been effectively approved with respect to the Fund's Class I
Shares if a majority of the outstanding voting securities of the
Class I Shares of the Fund votes for approval of the Plan.
3. The Plan shall not take effect until it has been
approved, together with any related agreements and supplements,
by votes of a majority of both (a) the Board of Trustees of the
Trust, and (b) those Trustees of the Trust who are not
"interested persons" (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of the
Plan or any agreements related to it (the "Plan Trustees"), cast
-17-
in person at a meeting (or meetings) called for the purpose of
voting on the Plan and such related agreements.
4. The Plan shall continue in effect so long as such
continuance is specifically approved at least annually in the
manner provided for approval of the Plan in paragraph 3.
5. Any person authorized to direct the disposition of
monies paid or payable by the Class I Shares of the Fund pursuant
to the Plan or any related agreement shall provide to the Trust's
Board of Trustees, and the Board shall review, at least
quarterly, a written report of the amounts so expended and the
purposes for which such expenditures were made.
6. Any agreement related to the Plan shall be in
writing and shall provide: (a) that such agreement may be
terminated at any time as to the Fund's Class I Shares, without
payment of any penalty, by vote of a majority of the Plan
Trustees or by vote of a majority of the outstanding voting
securities of the Class I Shares of the Fund, on not more than
sixty days' written notice to any other party to the agreement;
and (b) that such agreement shall terminate automatically in the
event of its assignment.
-18-
7. The Plan may be terminated at any time, without
payment of any penalty, by vote of a majority of the Plan
Trustees, or by vote of a majority of the outstanding Class I
Shares of the Fund.
8. The Plan may be amended at any time by the Trust's
Board of Trustees, provided that (a) any amendment to increase
materially the costs which the Class I Shares of the Fund may
bear for distribution pursuant to the Plan shall be effective
only upon approval by a vote of a majority of the Class I Shares
of the Fund, and (b) any material amendments of the terms of the
Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and
nomination of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund shall be committed to the
discretion of the Trustees who are not interested persons.
10. The Trust shall preserve copies of the Plan, any
related agreement and any report made pursuant to paragraph 5
hereof, for a period of not less than six years from the date of
the Plan, such agreement or report, as the case may be, the first
two years of which shall be in an easily accessible place.
-19-
11. It is understood and expressly stipulated that
neither the holders of Class I Shares of the Fund nor any
Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the Trust has executed this
Distribution Plan on this ___ day of May, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
on behalf of TEMPLETON LALTIN AMERICA FUND
By: _______________________________
John R. Kay
Vice President
Attest:
_______________________
Thomas M. Mistele
Secretary
Exhibit (15)(E)(ii)
Distribution Plan -
Templeton Latin America Fund Class II
<PAGE>
-21-
DISTRIBUTION PLAN
WHEREAS, Templeton Global Investment Trust (the
"Trust") is registered as an open-end diversified management
investment company under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust on behalf of Templeton Latin America
Fund (the "Fund") and Franklin Templeton Distributors, Inc. (the
"Selling Company"), a wholly owned subsidiary of Franklin
Resources, Inc. and a broker-dealer registered under the
Securities Exchange Act of 1934, have entered into a Distribution
Agreement pursuant to which the Selling Company will act as
principal underwriter of the Class II Shares of the Fund for sale
to the public; and
WHEREAS, shares of common stock of the Fund are divided
into classes of shares, one of which is designated Class II;
WHEREAS, the Board of Trustees of the Trust has
determined to adopt this Distribution Plan (the "Plan"), in
accordance with the requirements of the 1940 Act and has
determined that there is a reasonable likelihood that the Plan
will benefit the Fund and the holders of Class II Shares.
NOW THEREFORE, the Trust on behalf of the Fund hereby
adopts, with respect to its Class II Shares, the Plan on the
following terms and conditions:
1. The Fund will reimburse the Selling Company for
costs and expenses incurred in connection with the distribution
and marketing of the Class II Shares of the Fund. Such
distribution costs and expenses may include: (a) payments to
broker-dealers who provide certain services of value to the
Fund's Class II Shareholders (sometimes referred to as a "trail
fee"); (b) reimbursement of expenses relating to selling and
servicing efforts or of organizing and conducting sales seminars;
(c) payments to employees or agents of the Selling Company who
engage in or support distribution of the Class II Shares; (d)
payment of the costs of preparing, printing and distributing
prospectuses and reports to prospective investors and of printing
and advertising expenses; (e) payment of dealer commissions and
wholesaler compensation in connection with sales of the Fund's
Class II Shares exceeding $1 million (for which the Trust imposes
no sales charge) and interest or carrying charges in connection
therewith; and (f) such other similar services as the Trust's
Board of Trustees determines to be reasonably calculated to
result in the sale of Class II Shares.
The Selling Company will be reimbursed for such costs,
expenses or payments on a monthly basis, subject to an annual
limit of 1.00% per annum of the average daily net assets of the
Fund's Class II Shares (of which up to 0.25% of such net assets
may be paid to dealers for personal service and/or the
-23-
maintenance of Class II Shareholder accounts (the "Service Fee"))
and subject to any applicable restriction imposed by rules of the
National Association of Securities Dealers, Inc. Payments made
out of or charged against the assets of the Class II Shares of
the Fund must be in reimbursement for costs and expenses in
connection with any activity which is primarily intended to
result in the sale of the Fund's Class II Shares or account
maintenance and personal service to Shareholders. The costs and
expenses not reimbursed in any one given month (including costs
and expenses not reimbursed because they exceeded the limit of
1.00% per annum of the average daily net assets of the Fund's
Class II Shares) may be reimbursed in subsequent months or years.
2. The Plan shall not take effect with respect to the
Fund's Class II Shares until it has been approved by a vote of at
least a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Class II Shares of the Fund. With
respect to the submission of the Plan for such a vote, it shall
have been effectively approved with respect to the Fund's Class
II Shares if a majority of the outstanding voting securities of
the Class II Shares of the Fund votes for approval of the Plan.
3. The Plan shall not take effect until it has been
approved, together with any related agreements and supplements,
by votes of a majority of both (a) the Board of Trustees of the
-24-
Trust, and (b) those Trustees of the Trust who are not
"interested persons" (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of the
Plan or any agreements related to it (the "Plan Trustees"), cast
in person at a meeting (or meetings) called for the purpose of
voting on the Plan and such related agreements.
4. The Plan shall continue in effect so long as such
continuance is specifically approved at least annually in the
manner provided for approval of the Plan in paragraph 3.
5. Any person authorized to direct the disposition of
monies paid or payable by the Class II Shares of the Fund
pursuant to the Plan or any related agreement shall provide to
the Trust's Board of Trustees, and the Board shall review, at
least quarterly, a written report of the amounts so expended and
the purposes for which such expenditures were made.
6. Any agreement related to the Plan shall be in
writing and shall provide: (a) that such agreement may be
terminated at any time as to the Fund's Class II Shares, without
payment of any penalty, by vote of a majority of the Plan
Directors or by vote of a majority of the outstanding voting
securities of the Class II Shares of the Fund, on not more than
sixty days' written notice to any other party to the agreement;
-25-
and (b) that such agreement shall terminate automatically in the
event of its assignment.
7. The Plan may be terminated at any time, without
payment of any penalty, by vote of a majority of the Plan
Trustees, or by vote of a majority of the outstanding Class II
Shares of the Fund.
8. The Plan may be amended at any time by the Trust's
Board of Trustees, provided that (a) any amendment to increase
materially the costs which the Class II Shares of the Fund may
bear for distribution pursuant to the Plan shall be effective
only upon approval by a vote of a majority of the Class II Shares
of the Fund, and (b) any material amendments of the terms of the
Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and
nomination of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Trust shall be committed to the
discretion of the Trustees who are not interested persons.
10. The Fund shall preserve copies of the Plan, any
related agreement and any report made pursuant to paragraph 5
hereof, for a period of not less than six years from the date of
-26-
the Plan, such agreement or report, as the case may be, the first
two years of which shall be in an easily accessible place.
11. It is understood and expressly stipulated that
neither the holders of Class II Shares of the Fund nor any
Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the Trust has executed this
Distribution Plan on this ___ day of May, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
on behalf of TEMPLETON LATIN AMERICA FUND
By: _______________________________
John R. Kay
Vice President
Attest:
_______________________
Thomas M. Mistele
Secretary
Exhibit (15)(D)(ii)
Distribution Plan -
Templeton Greater European Fund Class II
<PAGE>
DISTRIBUTION PLAN
WHEREAS, Templeton Global Investment Trust (the
"Trust") is registered as an open-end diversified management
investment company under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust on behalf of Templeton Greater
European Fund (the "Fund") and Franklin Templeton Distributors,
Inc. (the "Selling Company"), a wholly owned subsidiary of
Franklin Resources, Inc. and a broker-dealer registered under the
Securities Exchange Act of 1934, have entered into a Distribution
Agreement pursuant to which the Selling Company will act as
principal underwriter of the Class II Shares of the Fund for sale
to the public; and
WHEREAS, shares of common stock of the Fund are divided
into classes of shares, one of which is designated Class II;
WHEREAS, the Board of Trustees of the Trust has
determined to adopt this Distribution Plan (the "Plan"), in
accordance with the requirements of the 1940 Act and has
determined that there is a reasonable likelihood that the Plan
will benefit the Fund and the holders of Class II Shares.
NOW THEREFORE, the Trust on behalf of the Fund hereby
adopts, with respect to its Class II Shares, the Plan on the
following terms and conditions:
1. The Fund will reimburse the Selling Company for
costs and expenses incurred in connection with the distribution
and marketing of the Class II Shares of the Fund. Such
distribution costs and expenses may include: (a) payments to
broker-dealers who provide certain services of value to the
Fund's Class II Shareholders (sometimes referred to as a "trail
fee"); (b) reimbursement of expenses relating to selling and
servicing efforts or of organizing and conducting sales seminars;
(c) payments to employees or agents of the Selling Company who
engage in or support distribution of the Class II Shares; (d)
payment of the costs of preparing, printing and distributing
prospectuses and reports to prospective investors and of printing
and advertising expenses; (e) payment of dealer commissions and
wholesaler compensation in connection with sales of the Fund's
Class II Shares exceeding $1 million (for which the Trust imposes
no sales charge) and interest or carrying charges in connection
therewith; and (f) such other similar services as the Trust's
Board of Trustees determines to be reasonably calculated to
result in the sale of Class II Shares.
The Selling Company will be reimbursed for such costs,
expenses or payments on a monthly basis, subject to an annual
limit of 1.00% per annum of the average daily net assets of the
Fund's Class II Shares (of which up to 0.25% of such net assets
may be paid to dealers for personal service and/or the
maintenance of Class II Shareholder accounts (the "Service Fee"))
and subject to any applicable restriction imposed by rules of the
National Association of Securities Dealers, Inc. Payments made
out of or charged against the assets of the Class II Shares of
the Fund must be in reimbursement for costs and expenses in
connection with any activity which is primarily intended to
result in the sale of the Fund's Class II Shares or account
maintenance and personal service to Shareholders. The costs and
expenses not reimbursed in any one given month (including costs
and expenses not reimbursed because they exceeded the limit of
1.00% per annum of the average daily net assets of the Fund's
Class II Shares) may be reimbursed in subsequent months or years.
2. The Plan shall not take effect with respect to the
Fund's Class II Shares until it has been approved by a vote of at
least a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Class II Shares of the Fund. With
respect to the submission of the Plan for such a vote, it shall
have been effectively approved with respect to the Fund's Class
II Shares if a majority of the outstanding voting securities of
the Class II Shares of the Fund votes for approval of the Plan.
3. The Plan shall not take effect until it has been
approved, together with any related agreements and supplements,
by votes of a majority of both (a) the Board of Trustees of the
Trust, and (b) those Trustees of the Trust who are not
"interested persons" (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of the
Plan or any agreements related to it (the "Plan Trustees"), cast
in person at a meeting (or meetings) called for the purpose of
voting on the Plan and such related agreements.
4. The Plan shall continue in effect so long as such
continuance is specifically approved at least annually in the
manner provided for approval of the Plan in paragraph 3.
5. Any person authorized to direct the disposition of
monies paid or payable by the Class II Shares of the Fund
pursuant to the Plan or any related agreement shall provide to
the Trust's Board of Trustees, and the Board shall review, at
least quarterly, a written report of the amounts so expended and
the purposes for which such expenditures were made.
6. Any agreement related to the Plan shall be in
writing and shall provide: (a) that such agreement may be
terminated at any time as to the Fund's Class II Shares, without
payment of any penalty, by vote of a majority of the Plan
Directors or by vote of a majority of the outstanding voting
securities of the Class II Shares of the Fund, on not more than
sixty days' written notice to any other party to the agreement;
and (b) that such agreement shall terminate automatically in the
event of its assignment.
7. The Plan may be terminated at any time, without
payment of any penalty, by vote of a majority of the Plan
Trustees, or by vote of a majority of the outstanding Class II
Shares of the Fund.
8. The Plan may be amended at any time by the Trust's
Board of Trustees, provided that (a) any amendment to increase
materially the costs which the Class II Shares of the Fund may
bear for distribution pursuant to the Plan shall be effective
only upon approval by a vote of a majority of the Class II Shares
of the Fund, and (b) any material amendments of the terms of the
Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and
nomination of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Trust shall be committed to the
discretion of the Trustees who are not interested persons.
10. The Fund shall preserve copies of the Plan, any
related agreement and any report made pursuant to paragraph 5
hereof, for a period of not less than six years from the date of
the Plan, such agreement or report, as the case may be, the first
two years of which shall be in an easily accessible place.
11. It is understood and expressly stipulated that
neither the holders of Class II Shares of the Fund nor any
Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the Trust has executed this
Distribution Plan on this ___ day of May, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
on behalf of TEMPLETON GREATER EUROPEAN FUND
By: _______________________________
John R. Kay
Vice President
Attest:
_______________________
Thomas M. Mistele
Secretary
Exhibit (15)(E)(i)
Distribution Plan -
Templeton Latin America Fund Class I
<PAGE>
DISTRIBUTION PLAN
WHEREAS, Templeton Global Investment Trust (the
"Trust") is registered as an open-end diversified management
investment company under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust on behalf of Templeton Latin America
Fund (the "Fund") and Franklin Templeton Distributors, Inc. (the
"Selling Company"), a wholly owned subsidiary of Franklin
Resources, Inc. and a broker-dealer registered under the
Securities Exchange Act of 1934, have entered into a Distribution
Agreement pursuant to which the Selling Company will act as
principal underwriter of the Class I Shares of the Fund for sale
to the public; and
WHEREAS, shares of common stock of the Fund are divided
into classes of shares, one of which is designated Class I;
WHEREAS, the Board of Trustees of the Trust has
determined to adopt this Distribution Plan (the "Plan"), in
accordance with the requirements of the 1940 Act and has
determined that there is a reasonable likelihood that the Plan
will benefit the Fund and the holders of Class I Shares.
NOW THEREFORE, the Trust on behalf of the Fund hereby
adopts, with respect to its Class I Shares, the Plan on the
following terms and conditions:
1. The Fund will reimburse the Selling Company for
costs and expenses incurred in connection with the distribution
and marketing of the Class I Shares of the Fund. Such
distribution costs and expenses may include: (a) payments to
broker-dealers who provide certain services of value to the
Fund's Class I Shareholders (sometimes referred to as a "trail
fee"); (b) reimbursement of expenses relating to selling and
servicing efforts or of organizing and conducting sales seminars;
(c) payments to employees or agents of the Selling Company who
engage in or support distribution of the Class I Shares; (d)
payment of the costs of preparing, printing and distributing
prospectuses and reports to prospective investors and of printing
and advertising expenses; (e) payment of dealer commissions and
wholesaler compensation in connection with sales of the Fund's
Class I Shares exceeding $1 million (for which the Trust imposes
no sales charge) and interest or carrying charges in connection
therewith; and (f) such other similar services as the Trust's
Board of Trustees determines to be reasonably calculated to
result in the sale of Class I Shares.
The Selling Company will be reimbursed for such costs,
expenses or payments on a monthly basis, subject to a limit of
0.35% per annum of the average daily net assets of the Fund's
Class I Shares. Payments made out of or charged against the
assets of the Class I Shares of the Fund must be in reimbursement
for costs and expenses in connection with any activity which is
primarily intended to result in the sale of the Fund's Class I
Shares. The costs and expenses not reimbursed in any one given
month (including costs and expenses not reimbursed because they
exceeded the limit of 0.35% per annum of the average daily net
assets of the Fund's Class I Shares) may be reimbursed in
subsequent months or years.
2. The Plan shall not take effect with respect to the
Fund's Class I Shares until it has been approved by a vote of at
least a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Class I Shares of the Fund. With
respect to the submission of the Plan for such a vote, it shall
have been effectively approved with respect to the Fund's Class I
Shares if a majority of the outstanding voting securities of the
Class I Shares of the Fund votes for approval of the Plan.
3. The Plan shall not take effect until it has been
approved, together with any related agreements and supplements,
by votes of a majority of both (a) the Board of Trustees of the
Trust, and (b) those Trustees of the Trust who are not
"interested persons" (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of the
Plan or any agreements related to it (the "Plan Trustees"), cast
in person at a meeting (or meetings) called for the purpose of
voting on the Plan and such related agreements.
4. The Plan shall continue in effect so long as such
continuance is specifically approved at least annually in the
manner provided for approval of the Plan in paragraph 3.
5. Any person authorized to direct the disposition of
monies paid or payable by the Class I Shares of the Fund pursuant
to the Plan or any related agreement shall provide to the Trust's
Board of Trustees, and the Board shall review, at least
quarterly, a written report of the amounts so expended and the
purposes for which such expenditures were made.
6. Any agreement related to the Plan shall be in
writing and shall provide: (a) that such agreement may be
terminated at any time as to the Fund's Class I Shares, without
payment of any penalty, by vote of a majority of the Plan
Trustees or by vote of a majority of the outstanding voting
securities of the Class I Shares of the Fund, on not more than
sixty days' written notice to any other party to the agreement;
and (b) that such agreement shall terminate automatically in the
event of its assignment.
7. The Plan may be terminated at any time, without
payment of any penalty, by vote of a majority of the Plan
Trustees, or by vote of a majority of the outstanding Class I
Shares of the Fund.
8. The Plan may be amended at any time by the Trust's
Board of Trustees, provided that (a) any amendment to increase
materially the costs which the Class I Shares of the Fund may
bear for distribution pursuant to the Plan shall be effective
only upon approval by a vote of a majority of the Class I Shares
of the Fund, and (b) any material amendments of the terms of the
Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and
nomination of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Fund shall be committed to the
discretion of the Trustees who are not interested persons.
10. The Trust shall preserve copies of the Plan, any
related agreement and any report made pursuant to paragraph 5
hereof, for a period of not less than six years from the date of
the Plan, such agreement or report, as the case may be, the first
two years of which shall be in an easily accessible place.
11. It is understood and expressly stipulated that
neither the holders of Class I Shares of the Fund nor any
Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the Trust has executed this
Distribution Plan on this ___ day of May, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
on behalf of TEMPLETON LALTIN AMERICA FUND
By: _______________________________
John R. Kay
Vice President
Attest:
_______________________
Thomas M. Mistele
Secretary
Exhibit (15)(E)(ii)
Distribution Plan -
Templeton Latin America Fund Class II
<PAGE>
DISTRIBUTION PLAN
WHEREAS, Templeton Global Investment Trust (the
"Trust") is registered as an open-end diversified management
investment company under the Investment Company Act of 1940 (the
"1940 Act"); and
WHEREAS, the Trust on behalf of Templeton Latin America
Fund (the "Fund") and Franklin Templeton Distributors, Inc. (the
"Selling Company"), a wholly owned subsidiary of Franklin
Resources, Inc. and a broker-dealer registered under the
Securities Exchange Act of 1934, have entered into a Distribution
Agreement pursuant to which the Selling Company will act as
principal underwriter of the Class II Shares of the Fund for sale
to the public; and
WHEREAS, shares of common stock of the Fund are divided
into classes of shares, one of which is designated Class II;
WHEREAS, the Board of Trustees of the Trust has
determined to adopt this Distribution Plan (the "Plan"), in
accordance with the requirements of the 1940 Act and has
determined that there is a reasonable likelihood that the Plan
will benefit the Fund and the holders of Class II Shares.
NOW THEREFORE, the Trust on behalf of the Fund hereby
adopts, with respect to its Class II Shares, the Plan on the
following terms and conditions:
1. The Fund will reimburse the Selling Company for
costs and expenses incurred in connection with the distribution
and marketing of the Class II Shares of the Fund. Such
distribution costs and expenses may include: (a) payments to
broker-dealers who provide certain services of value to the
Fund's Class II Shareholders (sometimes referred to as a "trail
fee"); (b) reimbursement of expenses relating to selling and
servicing efforts or of organizing and conducting sales seminars;
(c) payments to employees or agents of the Selling Company who
engage in or support distribution of the Class II Shares; (d)
payment of the costs of preparing, printing and distributing
prospectuses and reports to prospective investors and of printing
and advertising expenses; (e) payment of dealer commissions and
wholesaler compensation in connection with sales of the Fund's
Class II Shares exceeding $1 million (for which the Trust imposes
no sales charge) and interest or carrying charges in connection
therewith; and (f) such other similar services as the Trust's
Board of Trustees determines to be reasonably calculated to
result in the sale of Class II Shares.
The Selling Company will be reimbursed for such costs,
expenses or payments on a monthly basis, subject to an annual
limit of 1.00% per annum of the average daily net assets of the
Fund's Class II Shares (of which up to 0.25% of such net assets
may be paid to dealers for personal service and/or the
maintenance of Class II Shareholder accounts (the "Service Fee"))
and subject to any applicable restriction imposed by rules of the
National Association of Securities Dealers, Inc. Payments made
out of or charged against the assets of the Class II Shares of
the Fund must be in reimbursement for costs and expenses in
connection with any activity which is primarily intended to
result in the sale of the Fund's Class II Shares or account
maintenance and personal service to Shareholders. The costs and
expenses not reimbursed in any one given month (including costs
and expenses not reimbursed because they exceeded the limit of
1.00% per annum of the average daily net assets of the Fund's
Class II Shares) may be reimbursed in subsequent months or years.
2. The Plan shall not take effect with respect to the
Fund's Class II Shares until it has been approved by a vote of at
least a majority (as defined in the 1940 Act) of the outstanding
voting securities of the Class II Shares of the Fund. With
respect to the submission of the Plan for such a vote, it shall
have been effectively approved with respect to the Fund's Class
II Shares if a majority of the outstanding voting securities of
the Class II Shares of the Fund votes for approval of the Plan.
3. The Plan shall not take effect until it has been
approved, together with any related agreements and supplements,
by votes of a majority of both (a) the Board of Trustees of the
Trust, and (b) those Trustees of the Trust who are not
"interested persons" (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of the
Plan or any agreements related to it (the "Plan Trustees"), cast
in person at a meeting (or meetings) called for the purpose of
voting on the Plan and such related agreements.
4. The Plan shall continue in effect so long as such
continuance is specifically approved at least annually in the
manner provided for approval of the Plan in paragraph 3.
5. Any person authorized to direct the disposition of
monies paid or payable by the Class II Shares of the Fund
pursuant to the Plan or any related agreement shall provide to
the Trust's Board of Trustees, and the Board shall review, at
least quarterly, a written report of the amounts so expended and
the purposes for which such expenditures were made.
6. Any agreement related to the Plan shall be in
writing and shall provide: (a) that such agreement may be
terminated at any time as to the Fund's Class II Shares, without
payment of any penalty, by vote of a majority of the Plan
Directors or by vote of a majority of the outstanding voting
securities of the Class II Shares of the Fund, on not more than
sixty days' written notice to any other party to the agreement;
and (b) that such agreement shall terminate automatically in the
event of its assignment.
7. The Plan may be terminated at any time, without
payment of any penalty, by vote of a majority of the Plan
Trustees, or by vote of a majority of the outstanding Class II
Shares of the Fund.
8. The Plan may be amended at any time by the Trust's
Board of Trustees, provided that (a) any amendment to increase
materially the costs which the Class II Shares of the Fund may
bear for distribution pursuant to the Plan shall be effective
only upon approval by a vote of a majority of the Class II Shares
of the Fund, and (b) any material amendments of the terms of the
Plan shall become effective only upon approval as provided in
paragraph 3 hereof.
9. While the Plan is in effect, the selection and
nomination of Trustees who are not "interested persons" (as
defined in the 1940 Act) of the Trust shall be committed to the
discretion of the Trustees who are not interested persons.
10. The Fund shall preserve copies of the Plan, any
related agreement and any report made pursuant to paragraph 5
hereof, for a period of not less than six years from the date of
the Plan, such agreement or report, as the case may be, the first
two years of which shall be in an easily accessible place.
11. It is understood and expressly stipulated that
neither the holders of Class II Shares of the Fund nor any
Trustee, officer, agent or employee of the Trust shall be
personally liable hereunder, nor shall any resort be had to other
private property for the satisfaction of any claim or obligation
hereunder, but the Trust only shall be liable.
IN WITNESS WHEREOF, the Trust has executed this
Distribution Plan on this ___ day of May, 1995.
TEMPLETON GLOBAL INVESTMENT TRUST
on behalf of TEMPLETON LATIN AMERICA FUND
By: _______________________________
John R. Kay
Vice President
Attest:
_______________________
Thomas M. Mistele
Secretary
EXHIBIT INDEX
Exhibit (5)(E) Investment Management Agreement - Templeton
Greater European Fund
Exhibit (5)(F) Investment Management Agreement - Templeton
Latin America Fund
Exhibit (6)(A) Amended and Restated Distribution Agreement
Exhibit (8) Amended and Restated Custody Agreement
Exhibit (9)(A) Amended and Restated Business Management
Agreement
Exhibit (9)(B) Amended and Restated Transfer Agent Agreement
Exhibit (11) Consent of Independent Public Accountants
Exhibit (15)(D)(i) Distribution Plan - Templeton Greater
European Fund Class I
Exhibit 15(D)(ii) Distribution Plan - Templeton Greater
European Fund Class II
Exhibit (15)(E)(i) Distribution Plan - Templeton Latin America
Fund Class I
Exhibit (15)(E)(ii) Distribution Plan - Templeton Latin America
Fund Class II
