<PAGE>
TEMPLETON PROSPECTUS -- MARCH 14, 1994
GLOBAL INFRASTRUCTURE FUND
- -------------------------------------------------------------------------------
INVESTMENT The investment objective of Templeton Global Infrastructure
OBJECTIVE Fund (the "Fund") is long-term capital growth. The Fund seeks
AND POLICIES its objective by investing primarily in securities of domestic
and foreign companies that are principally engaged in or
related to the development, operation or rehabilitation of the
physical and social infrastructures of various nations
throughout the world. THE FUND MAY BORROW MONEY FOR INVESTMENT
PURPOSES, WHICH MAY INVOLVE GREATER RISK AND ADDITIONAL COSTS
TO THE FUND. IN ADDITION, THE FUND MAY INVEST UP TO 15% OF ITS
ASSETS IN ILLIQUID SECURITIES, INCLUDING UP TO 10% OF ITS
ASSETS IN RESTRICTED SECURITIES, WHICH MY INVOLVE GREATER RISK
AND INCREASED FUND EXPENSES. SEE "RISK FACTORS." The Fund is a
series of Templeton Global Investment Trust.
- -------------------------------------------------------------------------------
PURCHASE OF Please complete and return the Shareholder Application. If you
SHARES need assistance in completing this form, please call our
Account Services Department. The Fund's Shares may be
purchased at a price equal to their net asset value plus a
sales commission not exceeding 5.75% of the offering price.
The minimum initial investment is $100 ($25 minimum for
subsequent investments).
- -------------------------------------------------------------------------------
PROSPECTUS This Prospectus sets forth concisely information about the
INFORMATION Fund 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 March 14, 1994 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 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
- -------------------------------------------------------------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
EXPENSE TABLE........ 2
GENERAL DESCRIPTION.. 3
Investment Objective
and Policies........ 3
INVESTMENT TECH-
NIQUES.............. 4
Temporary Invest-
ments............... 4
Borrowing............ 4
Loans of Portfolio
Securities.......... 5
Options on Securities
or Indices.......... 5
Forward Foreign
Currency Contracts
and Options on
Foreign Currencies.. 5
Futures Contracts.... 6
Repurchase Agree-
ments............... 6
Depositary Receipts.. 6
Illiquid and Re-
stricted Securities. 7
RISK FACTORS......... 7
HOW TO BUY SHARES OF
THE FUND............ 8
</TABLE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
Net Asset Value...... 8
Offering Price....... 9
Cumulative Quantity
Discount............ 10
Letter of Intent..... 10
Group Purchases...... 10
Net Asset Value Pur-
chases.............. 11
Exchange Privilege... 12
Automatic Investment
Plan................ 13
Institutional Ac-
counts.............. 13
Account Statements... 13
Templeton STAR Serv-
ice................. 13
Retirement Plans..... 13
HOW TO SELL SHARES OF
THE FUND............ 13
Reinstatement Privi-
lege................ 15
Contingent Deferred
Sales Charge........ 15
Systematic Withdrawal
Plan................ 15
</TABLE>
<TABLE>
<CAPTION>
Page
----
<S> <C>
MANAGEMENT OF THE
FUND................ 16
Investment Manager... 16
Business Manager..... 17
Transfer Agent....... 17
Custodian............ 17
Plan of Distribution. 17
Brokerage Commis-
sions............... 17
GENERAL INFORMATION.. 17
Description of
Shares/Share
Certificates........ 17
Meetings of Share-
holders............. 17
Dividends and Distri-
butions............. 18
Federal Tax Informa-
tion................ 18
Inquiries............ 18
Performance Informa-
tion................ 18
Withholding Informa-
tion................ 19
Corporate Resolution. 20
</TABLE>
- -------------------------------------------------------------------------------
SHARES OF THE FUND 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.
1
<PAGE>
EXPENSE TABLE
<TABLE>
<S> <C>
SHAREHOLDER TRANSACTION EXPENSES
Maximum Sales Load Imposed on Purchases (as a percentage of Offering
Price)................................................................ 5.75%
Deferred Sales Charge.................................................. None*
ANNUAL FUND OPERATING EXPENSES (AS A PERCENTAGE OF AVERAGE NET ASSETS)
Management Fees........................................................ 0.75%
12b-1 Fees............................................................. 0.35%**
Other Expenses (audit, legal, business management, transfer agent and
custodian) (after expense reimbursement).............................. 0.15%
Total Fund Operating Expenses (after expense reimbursement)............ 1.25%
</TABLE>
<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<S> <C> <C>
You would pay the following expenses on a $1,000 investment,
assuming (1) 5% annual return and (2) redemption at the end of
each time period:............................................. $69 $95
</TABLE>
- -------
* Investments of $1 million or more are not subject to an initial sales load;
however, a contingent deferred sales charge of 1% is imposed in the event
of certain redemption transactions within one year following such
investments. (See "How to Sell Shares of the Fund--Contingent Deferred
Sales Charge.")
** These expenses may not exceed 0.35% of the Fund's average net assets
annually. (See "Management of the Fund--Plan of Distribution.") After a
substantial period, these expenses, together with the initial sales charge,
may total more than the maximum sales expense that would have been
permissible if imposed entirely as an initial sales charge.
The information in the table above is an estimate based on the Fund's
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 Fund will bear, directly or
indirectly. The information in the table does not reflect the charge of $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 Fund's fees and
expenses, see "Management of the Fund."
The Fund's Business Manager, Templeton Global Investors, Inc., has
voluntarily agreed to limit the total expenses (excluding interest, taxes,
brokerage commissions and extraordinary expenses) of the Fund to an annual
rate of 1.25% of the Fund's average daily net assets until December 31, 1994.
If this policy were not in effect, the Fund's "Other Expenses" and "Total Fund
Operating Expenses" would be 1.90% and 3.00%, respectively, and you would pay
the following expenses on a $1,000 investment, assuming 5% annual return and
redemption at the end of each time period: $86 for one year and $145 for three
years. As long as this temporary expense limitation continues, it may lower
the Fund's expenses and increase its total return. After December 31, 1994,
the expense limitation may be terminated or revised at any time, at which time
the Fund's expenses may increase and its total return may be reduced,
depending on the total assets of the Fund.
2
<PAGE>
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 (the "1940 Act") as an open-end management
investment company. It has two diversified series of Shares, each of which is
a separate mutual fund: Templeton Global Infrastructure Fund (the "Fund") and
Templeton Global Rising Dividends Fund. A Prospectus for Templeton Global
Rising Dividends Fund is available upon request and without charge from the
Principal Underwriter.
INVESTMENT OBJECTIVE AND POLICIES. The investment objective of the Fund is
long-term capital growth. The Fund seeks to achieve this objective by
investing at least 65% of its total assets in securities of domestic and
foreign companies that are principally engaged in or related to the
development, operation or rehabilitation of the physical and social
infrastructures of various nations throughout the world. The 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 without Shareholder approval.
The Fund's investment objective is based on the belief that the development
of the physical and social infrastructures of world economies is essential for
economic growth and must be undertaken by all countries to achieve and
maintain competitive industrial bases. A company is "principally engaged in or
related to the development, operation or rehabilitation of physical and social
infrastructures of various nations throughout the world" if at least 50% of
its assets (marked-to-market), gross income or net profits are attributable to
activities related to the following industries, among others: communications;
production of building materials; power generation; public utilities;
distribution of goods and services; toll road operation and development; the
manufacturing of steel and other metals; air, sea, land and rail
transportation; rail, aircraft and seacraft manufacturing and rehabilitation;
port ownership and operation; operation of water utilities and waste water
treatment facilities; industrial fabrication; bridge erection; heating,
ventilation and air conditioning (HVAC) manufacturing and installation;
manufacturing and operation of pollution control equipment; operation of
medical facilities; development and construction of housing; operation of
broadcast media; and the manufacturing, operation, installation and
maintenance of technology-related infrastructure such as local and wide area
network software and other essential components in the movement of
information. Companies providing construction materials or equipment, or
engineering, construction and contracting services, would also be included, as
would companies providing funding or expertise necessary for the completion of
infrastructure projects.
The evolving long-term international trend favoring more market-oriented
economies challenges countries with developing markets to upgrade their
national economies in order to compete in the international marketplace. This
trend may be facilitated by local or international political, economic or
financial developments that could benefit companies engaged in the development
of these countries' national economies. Certain of these countries,
particularly countries such as Mexico and the countries of the Pacific Basin,
have experienced relatively high rates of economic growth in recent years. The
development of the local infrastructures in these countries is a crucial
element in their continued growth. For example, Japan, Hong Kong, Singapore,
Taiwan, South Korea, Thailand, Malaysia, Indonesia and the Philippines have
all recently made substantial, long-term commitments to the development of
their infrastructures.
Many investors, particularly individuals, lack the information, capability
or inclination to invest in foreign capital markets. It also may not be
permissible for such investors to invest directly in certain markets. Unlike
many intermediary investment vehicles, such as closed-end investment companies
that invest in a single country, the Fund will seek to allocate investment
risk among the capital markets of a number of countries. Under normal
circumstances, the Fund will invest at least 65% of its total assets in
issuers domiciled in at least three different nations (one of which may be the
United States). The Fund will not necessarily seek to diversify investments on
a geographical basis or on the basis of the level of economic development of
any particular country. While there exists much information
3
<PAGE>
indicating that foreign capital markets may experience growth as a result of a
renewed international commitment to the development of economic
infrastructures, there can be no assurance, of course, that such growth will
occur or that the securities purchased by the Fund will provide long-term
capital growth.
Consistent with its investment objective, the Fund expects to invest at
least 65% of its total assets in securities of issuers listed on United States
or foreign securities exchanges or the NASDAQ system that are principally
engaged in or related to infrastructure industries. The Fund will generally
invest in equity securities of such issuers, defined as 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"). The Fund may also invest in debt
securities (defined as bonds, notes, debentures, commercial paper, time
deposits and bankers' acceptances) of issuers involved in or related to
infrastructure industries. There is no limitation on the percentage of the
Fund's assets that may be invested in debt securities, subject to the Fund's
investment objective. 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 benefit from
increases in the market price of the securities into which they are
convertible. Debt securities purchased by the Fund may be rated in any
category by Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's
Corporation ("S&P"), or may be unrated by any rating agency. Such securities
may include high risk, lower quality debt securities, commonly referred to as
"junk bonds." As an operating policy, which may be changed by the Board of
Trustees, the Fund will not invest more than 5% of its total assets in debt
securities rated Baa or lower by Moody's or BBB or lower by S&P. Debt
securities are subject to certain market and credit risks. See "Investment
Objectives and Policies--Debt Securities" in the SAI.
The Fund may also lend its portfolio securities and borrow money for
investment purposes ( i.e., "leverage" its portfolio). In addition, the Fund
may enter into transactions in options on securities, securities indices and
foreign currencies, forward foreign currency contracts, and futures contracts
and related options. When deemed appropriate by the Fund's investment manager,
Templeton Investment Counsel, Inc. (the "Investment Manager"), the Fund 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.
The Fund invests for long-term growth of capital and does not emphasize
short-term trading profits. Accordingly, the Fund expects to have an annual
portfolio turnover rate not exceeding 50%. There can be no assurance that the
Fund's investment objective will be achieved.
INVESTMENT TECHNIQUES
TEMPORARY INVESTMENTS. For temporary defensive purposes, the 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: debt
obligations issued or guaranteed by the U.S. Government or the governments of
foreign countries, their agencies or instrumentalities; short-term time
deposits with banks; repurchase agreements with banks and broker-dealers with
respect to U.S. Government obligations; and finance company and corporate
commercial paper, and other short-term corporate 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.
BORROWING. The 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, the Fund is required to maintain continuous asset coverage of 300%
with respect to such borrowings
4
<PAGE>
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 the 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 the 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. The Fund may lend to broker-dealers portfolio
securities with an aggregate market value of up to one-third of its 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, 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. The Fund may terminate the loans at any
time and obtain the return of the securities loaned within five business days.
The 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, the 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. To increase its return or to hedge all or
a portion of its portfolio investments, the 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. The Fund may write a call or put option only if the option is
"covered." This means that so long as the 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 the 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 the Fund. The 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
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.
The Fund will enter into forward contracts only under two circumstances.
First, when the Fund enters into a 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 amount of the former foreign currency approximating the value
of some or all of the Fund's portfolio securities denominated in such foreign
currency. The second investment practice is generally referred to as "cross-
hedging." The Fund has no specific limitation on the percentage of assets it
may commit to forward contracts, subject to its stated investment objective
and policies, except that the 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 Fund from
adverse currency movements, they also involve the risk that anticipated
currency movements will not be accurately predicted.
5
<PAGE>
The Fund 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 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 the 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 the 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 Fund are traded on U.S. and
foreign exchanges or over-the-counter.
FUTURES CONTRACTS. For hedging purposes only, the Fund 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 the 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 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 the Fund enters into a futures
contract, it will segregate assets or "cover" its position in accordance with
the 1940 Act. (See "Investment Objectives and Policies--Futures Contracts" in
the SAI.) With respect to positions in futures and related options that do not
constitute "bona fide hedging" positions, the Fund will not enter into a
futures contract or related option contract if, immediately thereafter, the
aggregate initial margin deposits relating to such positions plus premiums
paid by it for open futures option positions, less the amount by which any
such options are "in-the-money," would exceed 5% of the Fund's total assets.
REPURCHASE AGREEMENTS. For temporary defensive purposes and for cash
management purposes, the Fund may, without limit, enter into repurchase
agreements with U.S. banks and broker-dealers. Under a repurchase agreement,
the 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
purchase price by an amount which reflects an agreed-upon rate of return,
which is not tied to the 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 collateralized. However,
if the seller should default on its obligation to repurchase the underlying
security, the Fund may experience delay or difficulty 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.
DEPOSITARY RECEIPTS. ADRs are Depositary Receipts typically issued 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 the Fund's investment policies, the Fund's
investments in Depositary Receipts will be deemed to be investments in the
underlying securities.
6
<PAGE>
ILLIQUID AND RESTRICTED SECURITIES. The 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 price movements. The 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. The 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 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 the 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 the Fund are required to be registered under the securities
laws of one or more jurisdictions before being resold, the Fund may be
required to bear the expenses of registration. The Fund will limit its
investment in restricted securities to 10% of its total assets, except that
Rule 144A securities determined by the Board of Trustees to be liquid are not
subject to this limitation.
RISK FACTORS
Shareholders should understand that all investments involve risk and there
can be no guarantee against loss resulting from an investment in the Fund, nor
can there be any assurance that the Fund's investment objective will be
attained. As with any investment in securities, the value of, and income from,
an investment in the Fund can decrease as well as increase, depending on 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. Additionally, investment decisions made
by the Investment Manager will not always be profitable or prove to have been
correct. The Fund is not intended as a complete investment program.
The Fund has 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. 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), default in foreign government securities,
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
Fund 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. Further, the settlement period of securities
transactions in foreign markets may be longer than in domestic markets. 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 the 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, the Fund is limited in the extent to which it may
invest in illiquid securities. See "Investment Objectives and Policies--Risk
Factors" in the SAI.
The Fund usually effects 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 the Fund converts assets from one currency to
another.
7
<PAGE>
The Fund is 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 of Trustees without
Shareholder approval, the Fund will not invest more than 5% of its total
assets in debt securities rated BBB or lower by S&P or Baa or lower 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 the 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. The 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.
Leveraging by means of borrowing may exaggerate the effect of any increase
or decrease in the value of portfolio securities on the 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.
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
the 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, the 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.
HOW TO BUY SHARES OF THE FUND
Shares of the Fund 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 Fund, 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.
NET ASSET VALUE. The net asset value of the Shares of the 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 the 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
8
<PAGE>
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 4:00 p.m., New York time, 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
the 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 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.
OFFERING PRICE. The Offering Price to the public on purchases of the Fund's
Shares made at one time by a single purchaser, by an individual, his or her
spouse and their children under age 21, or by a single trust or fiduciary
account other than an employee plan, is the net asset value per Share plus a
sales commission not exceeding 5.75% of the Offering Price (equivalent to
6.10% of the net asset value), which is reduced on larger sales as shown
below:
<TABLE>
<CAPTION>
SALES COMMISSION
---------------------------------
AS A PERCENTAGE AS A PERCENTAGE PORTION OF TOTAL
AMOUNT OF SINGLE OF OFFERING OF NET ASSET OFFERING PRICE
SALE AT PRICE OF THE VALUE OF THE RETAINED BY
OFFERING PRICE SHARES PURCHASED SHARES PURCHASED DEALERS
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C>
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)*
</TABLE>
- -------
* The following commissions will be paid by FTD to dealers who initiate and
are responsible for purchases of $1 million or more and for purchases made
at net asset value by certain retirement plans of organizations with
collective retirement plan assets of $10 million or more: 1.00% on sales of
up to $2 million, plus 0.80% on sales of $2 million to $3 million, plus
0.50% on sales of $3 million to $50 million, plus 0.25% on sales of $50
million to $100 million, plus 0.15% on sales in excess of $100 million.
No initial sales commission applies on investments of $1 million or more,
but a contingent deferred sales charge of 1% is imposed on certain redemptions
within one year of the purchase. (See "How to Sell Shares of the Fund--
Contingent Deferred Sales Charge.")
A sales commission of 4% of the Offering Price (4.17% of the net asset
value) is applicable to all purchases of Shares made for any qualified or non-
qualified employee benefit plan. Of the 4% sales commission applicable to such
purchases, 3.20% of the Offering Price will be retained by dealers.
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. FTD or its affiliates, at their
expense, may also provide additional compensation to dealers in connection
with sales of Shares of the Fund and other funds in the Franklin Group of
Funds (R) 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
9
<PAGE>
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 Fund's Shares to
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. None of the aforementioned additional compensation
is paid for by the Fund or its Shareholders.
Dealers whose Shareholder accounts with the Fund equal or exceed $25,000
will be paid a continuing trail fee at the annual rate of 0.25% of the average
daily net asset value of Fund Shares registered in the name of that broker-
dealer as nominee or held in a Shareholder account that designates that
broker-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 the Fund.
As to telephone orders 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
dealers or individual investors are effected at the Offering Price 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 United States 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
Fund.
Investors should promptly check the confirmation advice that is mailed after
each purchase (or redemption) in order to ensure that it has been accurately
recorded in the investor's account.
CUMULATIVE QUANTITY DISCOUNT. The schedule of reduced sales charges also may
be applied to qualifying sales 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 any other
Shares of the Fund and/or any other funds in the Franklin/Templeton Group
owned at that time by the purchaser, his or her spouse, and their children
under age 21. For example, if the investor held 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 the Fund's Shares, the sales commission for the
$20,000 purchase would be at the rate of 4.50%. It is FTD's policy to give
investors the best sales commission 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 Shares to be registered in "street name," FTD will
accept the dealer's instructions with respect to the applicable sales
commission 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
by means of a Letter of Intent ("LOI") which expresses the investor's
intention to invest a certain amount within a 13-month period in Shares of the
Fund or any other fund in the Franklin/Templeton Group. See the Shareholder
Application. The minimum initial investment under an LOI is 5% of the total
LOI amount. 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. For a
further description of the Letter of Intent, 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 Shares of the Fund at the reduced sales charge applicable to the
group as a whole. The sales charge is based upon the aggregate dollar value of
Shares previously purchased
10
<PAGE>
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 Fund 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 Fund or FTD and the members, must agree to include
sales and other materials related to the Fund 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 Fund.
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 the Fund, there may be a delay between the time of the payroll
deduction and the time the money reaches the Fund. The investment in the Fund
will be made at the Offering Price per Share determined on the day that both
the check and payroll deduction data are received in required form by the
Fund.
NET ASSET VALUE PURCHASES. Shares of the Fund may be purchased at net asset
value without imposition of a sales commission by the following persons: (i)
trustees or other fiduciaries purchasing securities for certain retirement
plans with assets of $10 million or more; (ii) directors, trustees and
officers of the investment companies sponsored by Templeton Worldwide, Inc.
and its affiliates (the "Templeton Group"), directors, officers and employees
(current or retired) in the Templeton Group (and their families) and
retirement plans established by the Templeton Group for employees; (iii)
companies exchanging shares with or selling assets to the Fund pursuant to a
merger, acquisition or exchange offer; (iv) dealers or brokers who have a
sales agreement with FTD, for their own accounts, or for retirement plans for
their employees or sold to registered representatives or full time employees
(and their families) that certify to FTD at the time of purchase that such
purchase is for their own account (or for the benefit of their families); (v)
insurance company separate accounts; (vi) accounts managed by the Templeton
Group; (vii) shareholders of Templeton Institutional Funds, Inc. reinvesting
redemption proceeds from that fund under a 401(k) plan in Shares of the Fund;
(viii) certain unit investment trusts and unit holders of such trusts
reinvesting their distributions from the trusts in the Fund; and (ix)
employees (and their families) of financial institutions which have, directly
or through affiliates, signed an agreement with FTD.
Shares of the Fund may also be purchased at net asset value by employee
benefit plans qualified under Section 401 of the Internal Revenue Code of
1986, as amended, (the "Code") including salary reduction plans qualified
under Section 401(k) of the Code, 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
500 or more employees or that the amount invested or to be invested during the
subsequent 13-month period in the Fund or other funds in the
Franklin/Templeton Group totals at least $1 million. Employee benefit plans
not qualified under Section 401 of the Code may be afforded the same privilege
if they meet the above requirements as well as the uniform criteria for
qualified groups described above under "Group Purchases" which enable FTD to
realize economies of scale in its sales efforts and sales-related expenses.
Shares of the Fund may be purchased at net asset value by trust companies
and bank trust departments for funds over which 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 Fund or any other funds
in the Franklin/Templeton Group 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.
11
<PAGE>
EXCHANGE PRIVILEGE. A Shareholder may exchange Shares into 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 and Franklin Valuemark II). However, Shares
purchased at net asset value and subject to a contingent deferred sales charge
(see "How To Sell Shares of the Fund--Contingent Deferred Sales Charge") are
not eligible for exchange between the Templeton Family of Funds and the
Franklin Group of Funds (R).
Exchange purchases are subject to the minimum investment requirements of the
fund purchased and no sales charge generally 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 shares
of a fund 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. In addition, 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 indicators.
All exchanges are permitted only after at least 15 days have elapsed from the
date of the purchase of the Shares to be exchanged. In addition, in accordance
with the terms of their respective prospectuses, certain funds do not accept,
or may place certain limitations on, exchanges by Timing Accounts.
A Shareholder may exchange Shares by writing to Franklin/Templeton Investor
Services, Inc. (the "Transfer Agent") (see "How to Sell Shares of the Fund"),
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. Neither the Transfer Agent,
any of its affiliates, nor the Franklin/Templeton Group will be liable for any
loss, damages, expense or cost arising out of any telephone exchange effected
upon instructions reasonably believed by them to be genuine. The Transfer
Agent has instituted procedures that it believes are reasonably designed to
insure that exchange instructions communicated by telephone are genuine, and
could be liable for losses caused by unauthorized or fraudulent instructions
in the absence of such procedures. The procedures currently include a recorded
verification of the Shareholder's name, social security number and account
number, followed by written confirmation of the transaction sent to the
address of record. Forms for declining the telephone exchange privilege and
prospectuses of the other funds in the Franklin/Templeton Group may be
obtained from FTD. Unless authorized, Shares held in corporate-type retirement
plans for which Templeton Funds Trust Company serves as trustee may not be
exchanged by telephone. 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 Fund--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 Fund 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.
During periods of drastic economic or market changes, it is possible that
the telephone exchange privilege may be difficult to implement. In this event,
Shareholders should follow the other exchange procedures discussed in this
section, including the procedures for processing exchanges through broker-
dealers.
The equivalent of an exchange involving retirement accounts (including
IRA's) between the Templeton Family of Funds and the Franklin Group of
Funds (R) requires the completion of additional documentation before it can be
effected. Call 1-800-354-9191 for further information and forms.
12
<PAGE>
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 Fund available for institutional
accounts. For further information, contract Franklin/Templeton Investor
Services, Inc. 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 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
(the Fund's code is 413) and the Shareholder's account number are necessary
for accessing information (other than Share prices) from Templeton STAR
Service.
RETIREMENT PLANS. Shares of the Fund may be purchased through various
retirement plans including the following plans for which Templeton Funds Trust
Company 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 annual fees, contact Franklin/Templeton
Distributors, Inc. To determine which retirement plan is appropriate, an
investor should contact his or her tax adviser.
HOW TO SELL SHARES OF THE FUND
Shares will be redeemed, without charge, 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. 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 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 Fund reserves the right to require signature guarantees on all
redemptions. A signature guarantee is required in connection with any request
for transfer of Shares. A signature guarantee is also required in connection
with any redemption if the Transfer Agent has, within the 30-day period prior
to receipt of the redemption request, received instructions to change the
Shareholder's address of record;
13
<PAGE>
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. If the Shares being redeemed are registered in the name of an estate,
trust, custodian, guardian, retirement plan or the like, or in the name of a
corporation or partnership, documents also must be included which, in the
judgment of the Transfer Agent, are sufficient to establish the authority of
the person(s) signing the request, and/or as may be required by applicable
laws or regulations, with signature(s) guaranteed as described in Item 2
above; and
5. Redemption of Shares held in a Templeton Tax Deferred Retirement Plan
must conform to the requirements of the Plan and the Fund's 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.
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 (800) 354-9191 or (813) 823-8712.
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 Fund 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 that has been in existence for more than six months) or express
mail, if requested, will be at a charge of $15, which will be deducted from
the redemption proceeds.
The Fund, through FTD, also repurchases Shares (whether in certificate or
book-entry form) through securities dealers. The Fund 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 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 Fund;
however, securities dealers may impose a charge on the Shareholder for
transmitting the notice of repurchase to the Fund. The 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. The 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.
14
<PAGE>
The Fund 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 Fund may involuntarily redeem the Shares of any investor who has
failed to provide the Fund with a certified taxpayer identification number or
such other tax-related certifications as the Fund may require. A notice of
redemption, sent by first-class mail to the investor's 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. A former Shareholder of any eligible Templeton Fund
may reinvest proceeds from a redemption or a dividend or capital gains
distribution, without a sales charge, in any other eligible Templeton Fund by
sending a written request and a check to the Transfer Agent within 120 days
after the date of the redemption or distribution. Reinvestment will be at the
next calculated net asset value after receipt. However, if a Shareholder's
original investment was in a fund with a lower sales charge, or no sales
charge, the Shareholder must pay the difference. Credit will be given for any
contingent deferred sales charge paid on the Shares redeemed. 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.
CONTINGENT DEFERRED SALES CHARGE. In order to recover commissions paid to
dealers on qualified investments of $1 million or more, a contingent deferred
sales charge of 1% applies to certain of those redemptions within the first
year after investing. 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. In
determining if a charge applies and the amount of any such charge, the first
Shares redeemed are those purchased with reinvested dividends and capital gain
distributions, followed by others held the longest. The contingent deferred
sales charge is waived for exchanges (except if Shares acquired by exchange
were then redeemed within 12 months of the initial purchase); for
distributions to participants in qualified retirement plans due to death,
disability or attainment of age 59 1/2; for tax-free returns of excess
contributions to qualified plans; for distributions from employee benefit
plans; and for redemptions through the Systematic Withdrawal Plan.
SYSTEMATIC WITHDRAWAL PLAN. A Shareholder may establish a Systematic
Withdrawal Plan ("Plan") and receive regular monthly, quarterly, semi-annual
or annual payments of $50 or more from the account. It is suggested that the
Shareholder maintain an account balance of $10,000. There are no service
charges for establishing or maintaining a Plan. Capital gain distributions and
income dividends to the Shareholder's account must be reinvested 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
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. No payment
pursuant to a Plan will be made if there are insufficient Shares on deposit on
the date of the scheduled distribution. A subsequent deposit of Shares will
not result in a payment under the Plan retroactive to the distribution date.
As with other redemptions, a liquidation to make a withdrawal payment is a
sale for Federal income tax purposes. The entire Plan payment cannot be
considered as actual yield or income since part of such a Plan payment may be
a return of capital.
Maintaining a Plan concurrently with purchases of additional Shares of the
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. A Plan may be terminated on written notice by the
Shareholder or the Fund, and it will terminate automatically if all Shares are
liquidated or
15
<PAGE>
withdrawn from the account, or upon the Fund's receipt of notification of the
death or incapacity of the Shareholder. Shareholders may change the amount
(but not below $50) and schedule of withdrawal payments or suspend such
payments (for up to one month) by giving written notice to the Transfer Agent
at least seven business days prior to the end of the month preceding a
scheduled payment. Share certificates may not be issued while a Plan is in
effect.
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.
INVESTMENT MANAGER. The Investment Manager of the Fund is Templeton
Investment Counsel, Inc., Broward Financial Centre, Fort Lauderdale, Florida
33394-3091. 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 Fund with investment research, advice
and supervision and has responsibility for management of the Fund's portfolio.
The Investment Manager does not furnish any overhead items or facilities for
the Fund, although such expenses are paid by some investment advisers of other
investment companies. As compensation for its services, the Fund pays the
Investment Manager a monthly fee, equal on an annual basis to 0.75% of its
average daily net assets during the year. This fee is higher than advisory
fees paid by most other U.S. investment companies, primarily because investing
in securities of companies in foreign markets, many of which are not widely
followed by professional analysts, requires the Investment Manager to invest
additional time and incur added expense in developing specialized resources,
including research facilities. The Fund also pays its own operating expenses,
including: (1) the fees and expenses of the disinterested Trustees; (2)
interest expenses; (3) taxes and governmental fees; (4) brokerage commissions
and other expenses incurred in acquiring or disposing of portfolio 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) 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. Management of the Fund is supported by
the Templeton organization's large staff of research analysts, traders and
other investment specialists based in Fort Lauderdale, Nassau, New York,
Edinburgh, Toronto, Hong Kong, Melbourne and Singapore. Templeton's research
analysts use a disciplined, long term approach to value oriented global and
international investing. Securities are selected for the Fund's portfolio from
a list of eligible securities maintained and constantly updated by Templeton's
analysts on the basis of fundamental company-by-company analysis, which
utilizes a global database of company information. Management believes that
the Templeton organization's team approach benefits Fund investors by bringing
together many disciplines and leveraging the organization's extensive
resources. Currently, the lead portfolio manager for the Fund is Harold W.
Ehrlich. Mr. Ehrlich is Vice President and a portfolio manager and research
analyst with the Investment Manager. Prior to joining the Templeton
organization in 1987, Mr. Ehrlich was Vice President with First Equity
Corporation of Florida, a regional investment banking firm, from 1983 to 1985.
His responsibilities there included equity research for the equity trading
department and the corporate finance
16
<PAGE>
department. Mr. Ehrlich then worked from 1985 to 1987 as analyst and assistant
portfolio manager at Fundamental Management Corporation. Daniel L. Jacobs and
Mark R. Beveridge will also exercise significant portfolio management
responsibilities with respect to the Fund. Mr. Jacobs, Senior Vice President
of the Investment Manager, joined the Templeton organization in 1984 as
portfolio manager and security analyst. Prior to joining the Templeton
organization, Mr. Jacobs was with First National Bank of Atlanta for eight
years, where he was vice president and portfolio manager in the Institutional
Investment Group. His responsibilities included the management of
institutional accounts and international equity portfolios. Mr. Beveridge,
Vice President of the Investment Manager, joined the Templeton organization in
1985 as a security analyst. Prior to joining the Templeton organization, Mr.
Beveridge was a principal with a financial accounting software firm based in
Miami, Florida. Further information concerning the Investment Manager 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 Fund, 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 its
services, the 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 Fund and Templeton Global Rising Dividends 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 Fund.
CUSTODIAN. The Chase Manhattan Bank, N.A. serves as custodian of the Fund's
assets.
PLAN OF DISTRIBUTION. The Fund has a plan of distribution or "12b-1 Plan"
under which it may reimburse FTD for its costs and expenses for activities
primarily intended to result in the sale of Fund Shares. Expenditures by the
Fund under the plan may not exceed 0.35% annually of the Fund's average daily
net assets. Under the plan, 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 Fund's average daily net assets) may be
reimbursed in subsequent months or years, subject to applicable law.
BROKERAGE COMMISSIONS. The Fund's brokerage policies are described under the
heading "Brokerage Allocation" in the SAI. The Fund'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 Fund's brokerage
policies.
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 Fund will not ordinarily issue certificates for Shares purchased. Share
certificates representing the whole (not fractional) 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 Fund is required to assist
Shareholder communications in connection with the calling of Shareholder
meetings to consider removal of a Trustee or Trustees.
17
<PAGE>
DIVIDENDS AND DISTRIBUTIONS. Dividends and capital gains distributions (if
any) are usually paid in October and (if necessary) in December representing
all or substantially all of the Fund's net investment income and any net
realized capital gains. Income dividends and capital gain distributions paid
by the 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 of the Fund at net asset value as of the ex-
dividend date, unless a Shareholder makes a written or telephonic request for
payments in cash. 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 the 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 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 Fund 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. The 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. The 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 such distributions were
declared. The Fund 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."
The 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 the Fund with their correct taxpayer identification number or
to make required certifications or where the 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 (800) 354-9191
or (813) 823-8712. Transcripts of Shareholder accounts less than three years
old are provided on request without charge; a fee of $15 per account is
charged for transcripts going back more than three years from the date the
request is received by the Transfer Agent.
PERFORMANCE INFORMATION. The Fund may include its total return in
advertisements or reports to Shareholders or prospective 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 the 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 the Fund at the
end of a defined period of time. For a description of the methods used to
determine total return for the Fund, see the SAI.
18
<PAGE>
INSTRUCTIONS AND IMPORTANT NOTICE
SUBSTITUTE W-9 INSTRUCTIONS INFORMATION
GENERAL. Backup withholding is not an additional tax. Rather, the tax
liability of persons subject to backup withholding will be reduced by the
amount of tax withheld. If withholding results in an overpayment of taxes, a
refund may be obtained from the IRS.
OBTAINING A NUMBER. If you do not have a Social Security Number Taxpayer
Identification Number, you must obtain Form SS-5 or Form SS-4 from your local
Social Security or IRS office and apply for one. If you have checked the
"Awaiting TIN" box and signed the certification, withholding will apply to
payments relating to your account unless you provide a certified TIN within 60
days.
WHAT SSN TIN TO GIVE. Please refer to the following guidelines:
<TABLE>
<CAPTION>
ACCOUNT TYPE GIVE SSN OF ACCOUNT TYPE GIVE EMPLOYER ID # OF
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>
. Individual Individual . Trust, Estate, or Trust, Estate, or
Pension Plan Trust Pension Plan Trust
- ------------------------------------------------------------------------------------------
. Joint Individual Owner who will be . Corporation, Corporation,
paying tax or first- Partnership, or Partnership, or other
named individual other organization organization
- ------------------------------------------------------------------------------------------
. Unif. Gift/Transfer Minor . Broker nominee Broker nominee
to Minor
- ------------------------------------------------------------------------------------------
. Sole Proprietor Owner of business
- ------------------------------------------------------------------------------------------
. Legal Guardian Ward, Minor, or
Incompetent
- ------------------------------------------------------------------------------------------
</TABLE>
EXEMPT RECIPIENTS. Please provide your TIN and check the "Exempt Recipient"
box if you are an exempt recipient. Exempt recipients generally include:
A corporation A real estate investment trust
A financial institution A common trust fund operated by
a bank under section 584(a)
An organization exempt from tax An exempt charitable remainder
under section 501(a), or an trust or a non-exempt trust
individual retirement plan described in section 4947(a)(1)
A registered dealer in An entity registered at all
securities or commodities times under the Investment
registered in the U.S. or a U.S. Company Act of 1940
possession
IRS PENALTIES. If you do not supply us with your SSN TIN, you will be subject
to an IRS $50 penalty unless your failure is due to reasonable cause and not
willful neglect. If you fail to report certain income on your Federal income
tax return, you will be treated as negligent and subject to an IRS 20% penalty
on any underpayment of tax attributable to such negligence, unless there was
reasonable cause for the resulting underpayment and you acted in good faith.
If you falsify information on this form or make any other false statement
resulting in no backup withholding on an account which should be subject to
backup withholding, you may be subject to an IRS $500 penalty and certain
criminal penalties including fines and imprisonment.
SUBSTITUTE W-8 INSTRUCTIONS INFORMATION
EXEMPT FOREIGN PERSON. Check the "Exempt Foreign Person" box if you qualify as
a non-resident alien or foreign entity that is not subject to certain U.S.
information return reporting or to backup withholding rules. Dividends paid to
your account may be subject to withholding of up to 30%. You are an "Exempt
Foreign Person" if you are not (1) a citizen or resident of the U.S., or (2) a
U.S. corporation, partnership, estate, or trust. In the case of an individual,
an "Exempt Foreign Person" is one who has been physically present in the U.S.
for less than 31 days during the current calendar year. An individual who is
physically present in the U.S. for at least 31 days during the current
calendar year will still be treated as an "Exempt Foreign Person," provided
that the total number of days physically present in the current calendar year
and the two preceding calendar years does not exceed 183 days (counting all of
the days in the current calendar year, only one-third of the days in the first
preceding calendar year and only one-sixth of the days in the second preceding
calendar year). In addition, lawful permanent residents or green card holders
may not be treated as "Exempt Foreign Persons." If you are an individual or an
entity, you must not now be, or at this time expect to be, engaged in a U.S.
trade or business with respect to which any gain derived from transactions
effected by the Fund/Payer during the calendar year is effectively connected
to the U.S. (or your transactions are exempt from U.S. taxes under a tax
treaty).
PERMANENT ADDRESS. The Shareholder Application must contain your permanent
address if you are an "Exempt Foreign Person." If you are an individual,
provide your permanent address. If you are a partnership or corporation,
provide the address of your principal office. If you are an estate or trust,
provide the address of your permanent residence or the principal office of any
fiduciary.
NOTICE OF CHANGE IN STATUS. If you become a U.S. citizen or resident after you
have provided certification of your foreign status, or if you cease to be an
"Exempt Foreign Person," you must notify the Fund/Payer within 30 days of your
change in status. Reporting will then begin on the account(s) listed, and
backup withholding may also begin unless you certify to the Fund/Payer that
(1) the tax payer identification number you have given is correct, and (2) the
Internal Revenue Service has not notified you that you are subject to backup
withholding because you failed to report certain interest or dividend income.
You may use Form W-9, "Payer's Request for Taxpayer Identification Number and
Certification," to make these certifications. If an account is no longer
active, you do not have to notify a Fund/Payer or broker of your change in
status unless you also have another account with the same Fund/Payer that is
still active. If you receive interest from more than one Fund/Payer or have
dealings with more than one broker or barter exchange, file a certificate with
each. If you have more than one account with the same Fund/Payer, the
Fund/Payer may require you to file a separate certificate for each account.
WHEN TO FILE. File these certifications with the Fund before a payment is made
to you, unless you have already done this in either of the two preceding
calendar years. Only certifications that are in proper order will be treated
as having been filed with the Fund.
HOW OFTEN YOU MUST FILE. This certificate generally remains in effect for
three calendar years. A Fund/Payer or broker, however, may require that a new
certificate be filed each time a payment is made. On joint accounts for which
each joint owner is a foreign person, each must provide a certification of
foreign status.
19
<PAGE>
FOR CORPORATE SHAREHOLDERS--FORM OF RESOLUTION
It will be necessary for corporate shareholders to provide a certified copy of
a resolution or other certificate of authority to authorize the purchase as
well as sale (redemption) of shares and withdrawals by checks or drafts. You
may use the following form of resolution or you may prefer to use your own. It
is understood that the Fund, Franklin/Templeton Distributors, Inc.,
Franklin/Templeton Investor Services, Inc., the custodian bank and their
affiliates may rely upon these authorizations until revoked or amended by
written notice delivered by registered or certified mail to the Fund.
CERTIFIED COPY OF RESOLUTION (Corporation or Association)
The undersigned hereby certifies and affirms that he/she is the duly
elected _________________________________ of __________________________________
TITLE CORPORATE NAME
a _______________________ organized under the laws of the State of ____________
TYPE OF ORGANIZATION STATE
and that the following is a true and correct copy of a resolution adopted by the
Board of Directors at a meeting duly called and held on ______________________
DATE
RESOLVED, that the _________________________________________________ of this
OFFICERS' TITLES
Corporation or Association are authorized to open an account in the name of
the Corporation or Association with one or more of the Franklin Group of
Funds(R) or Templeton Group ("Funds") and to deposit such funds of this
Corporation or Association in this account as they deem necessary or
desirable; that the persons authorized below may endorse checks and other
instruments for deposit to said account or accounts; and
FURTHER RESOLVED, that any of the following _________ officers are authorized
NUMBER
to sign any share assignment on behalf of this Corporation or Association and
to take any other actions as may be necessary to sell or redeem its shares in
the Funds or to sign checks or drafts withdrawing funds from the account; and
FURTHER RESOLVED, that this Corporation or Association shall hold harmless,
indemnify, and defend the Funds, their custodian bank, Franklin/Templeton
Distributors, Inc., Franklin/Templeton Investor Services, Inc., and their
affiliates, from any claim, loss or liability resulting in whole or in
part, directly or indirectly, from their reliance from time to time upon
any certifications by the secretary or any assistant secretary of this
Corporation or Association as to the names of the individuals occupying
such offices and their acting in reliance upon these resolutions until
actual receipt by them of a certified copy of a resolution of the Board of
Directors of the Corporation or Association modifying or revoking any or
all such resolutions.
The undersigned further certifies that the below named persons, whose
signatures appear opposite their names and office titles, are duly elected
officers of the Corporation or Association. (Attach additional list if
necessary)
- -------------------------------------- --------------------------------------
NAME/TITLE (PLEASE PRINT OR TYPE) SIGNATURE
- -------------------------------------- --------------------------------------
NAME/TITLE (PLEASE PRINT OR TYPE) SIGNATURE
- -------------------------------------- --------------------------------------
NAME/TITLE (PLEASE PRINT OR TYPE) SIGNATURE
- -------------------------------------- --------------------------------------
NAME/TITLE (PLEASE PRINT OR TYPE) SIGNATURE
- -------------------------------------- --------------------------------------
NAME OF CORPORATION OR ASSOCIATION DATE
Certified from minutes ________________________________________________________
NAME AND TITLE
CORPORATE SEAL (if appropriate)
20
<PAGE>
NOTES
21
<PAGE>
NOTES
22
<PAGE>
NOTES
23
<PAGE>
TEMPLETON GLOBAL
INFRASTRUCTURE FUND
PRINCIPAL UNDERWRITER:
Franklin/Templeton
Distributors, Inc.
700 Central Avenue
St. Petersburg,
Florida 33701-3628
Account Services
1-800-354-9191
Sales Information
1-800-292-9293
This Prospectus is not an offering of
the securities herein described
in any state in which the offering
is not authorized. No sales
representative, dealer, or other
person is authorized to give
any information or make any
representations other than those
contained in this Prospectus.
Further information may be
obtained from the Principal
Underwriter.
[RECYCLED PAPER LOGO APPEARS HERE]
TL13 P 3/94
TEMPLETON
GLOBAL
INFRASTRUCTURE
FUND
Prospectus
March 14, 1994
[LOGO OF TEMPLETON WORLDWIDE APPEARS HERE]
<PAGE>
[LOGO OF TEMPLETON APPEARS HERE]
Mail to: Franklin Templeton Distributors, Inc.
P.O. Box 33031 St. Petersburg, Florida 33733-8031
(800) 393-3001
Please do not use this form for any Retirement Plan for which Templeton Funds
Trust Company or its affiliate serves as custodian or trustee or any of the
following Templeton Funds: Templeton American Trust: Templeton Money Fund;
Templeton Institutional Funds or Templeton Capital Accumulator Fund. Please
request separate Applications and/or Prospectuses.
================================================================================
SHAREHOLDER APPLICATION OR REVISION [_] Please check the box if this is a
revision and see Section 8
================================================================================
<TABLE>
<S> <C> <C>
Date ___________________ [_] Real Estate Securities Fund $______ [_] Global Opportunities Trust $______
[_] Growth Fund $_______ [_] Smaller Companies Growth Fund ______ [_] Americas Government Securities Fund ______
[_] World Fund _________ [_] Income Fund ______ [_] Japan Fund ______
[_] Foreign Fund _______ [_] Global Infrastructure Fund ______ [_] Other ______
[_] Global Rising Dividends Fund ______ [_] Developing Markets Trust ______
</TABLE>
================================================================================
1 ACCOUNT REGISTRATION (PLEASE PRINT)
================================================================================
[_] INDIVIDUAL OR JOINT ACCOUNT
__________________________________________________________ _____-_______-______
First Name Middle Initial Last Name Social Security
Number (SSN)
__________________________________________________________ _____-_______-______
Joint Owner(s) (Joint ownership means "Joint Tenants Social Security
With Rights of Survivorship" unless otherwise specified) Number (SSN)
================================================================================
[_] GIFT/TRANSFER TO A MINOR
__________________ As Custodian For ____________________________________________
Minor's Name (one only)
_____________________ Uniform Gifts/Transfers to Minors Act _____-______-_______
State of Residence Minor's Social
Security Number
Please Note: Custodian's Signature, not Minor's, is required in Section 4.
================================================================================
[_] TRUST, CORPORATION, PARTNERSHIP, OR OTHER ENTITY
______________________________________________________________-_________________
Name Taxpayer Identification Number (TIN)
________________________________________________________________________________
Name of Beneficiary (if to be included Date of Trust Document (must be
in the Registration) completed for registration)
________________________________________________________________________________
Name of Each Trustee (if to be included in the Registration)
================================================================================
2 ADDRESS
================================================================================
__________________________________________________ Daytime Phone (___)_________
Street Address Area Code
____________________________________________-_____ Evening Phone (___)_________
City State Zip Code Area Code
I am a Citizen of: [_] U.S. [_] _____________________________
Country of Residence
================================================================================
3 INITIAL INVESTMENT ($100 minimum initial investment)
================================================================================
Check(s) enclosed for $____________ (Payable to Franklin Templeton Distributors,
Inc. or the Fund(s) indicated above.)
================================================================================
4 SIGNATURE AND TAX CERTIFICATIONS (All registered owners must sign
application)
================================================================================
The Fund reserves the right to refuse to open an account without either a
certified Taxpayer Identification Number ("TIN") or a certification of foreign
status. Failure to provide tax certifications in this section may result in
backup withholding on payments relating to your account and/or in your inability
to qualify for treaty withholding rates.
I am(We are) not subject to backup withholding because I(we) have not been
notified by the IRS that I am(we are) subject to backup withholding as a result
of a failure to report all interest or dividends or because the IRS has notified
me(us) that I am(we are) no longer subject to backup withholding. (If you are
currently subject to backup withholding as a result of a failure to report all
interest or dividends, please cross out the preceding statement.)
[_] The number shown above is my(our) correct TIN, or that of the Minor named in
Section 1.
[_] Awaiting TIN. I am(We are) waiting for a number to be issued to me(us).
I(We) understand that if I(we) do not provide a TIN to the Fund within 60
days, the Fund is required to commence 31% backup withholding until I(we)
provide a certified TIN.
[_] Exempt Recipient. Individuals cannot be exempt. Check this box only after
reading the instructions to see whether you qualify as an exempt recipient.
(You should still provide a TIN.)
[_] Exempt Foreign Person. Check this box only if the following statement
applies: "I am(we are) neither a citizen nor a resident of the United
States. I(we) certify to the best of my(our) knowledge and belief, I(we)
qualify as an exempt foreign person and/or entity as described in the
instructions."
Permanent address for tax purposes:
________________________________________________________________________________
Street Address City State Country Postal Code
PLEASE NOTE: The IRS only allows one TIN to be listed on an account. On joint
accounts, it is preferred that the primary account owner (or person listed first
on the account) list his/her number as requested above.
CERTIFICATION - Under the penalties of perjury, I(we) certify that (1) the
information provided on this application is true, correct and complete, (2)
I(we) have read the prospectus(es) for the Fund(s) in which I am(we are)
investing and agree to the terms thereof, and (3) I am(we are) of legal age or
an emancipated minor. I(we) acknowledge that Shares of the Fund(s) are not
insured or guaranteed by any agency or institution and that an investment in the
Shares involves risks, including the possible loss of principal.
X_____________________________________ X________________________________________
Signature Signature
X_____________________________________ X________________________________________
Signature Signature
Please make a photocopy of this application for your records.
================================================================================
5 BROKER/DEALER USE ONLY (PLEASE PRINT)
================================================================================
+ +
+ We hereby submit this application for the purchase of shares of the Fund +
+ indicated above in accordance with the terms of our selling agreement with +
+ Franklin Templeton Distributors, Inc. ("FTD"), and with the Prospectus for +
+ the Fund. We agree to notify FTD of any purchases made under a Letter of +
+ Intent or Cumulative Quantity Discount. +
+ +------------------------------+ +
+ +Templeton Dealer Number + +
+ + + +
+ +------------------------------+ +
+ +
+ +--------------------------------------------------------------------------+ +
+ + WIRE ORDER ONLY: The attached check for $_____ should be applied against + +
+ + Wire Order + +
+ + + +
+ + Confirmation Number ______________ Dated ___________ For ________ Shares + +
+ +--------------------------------------------------------------------------+ +
+ +
+ Securities Dealer Name _____________________________________________________ +
+ +
+ Main Office Address _____________ Main Office Telephone Number(___)_________ +
+ +
+ Branch Number _____ Representative Number _____ Representative Name ________ +
+ +
+ Branch Address _______________________ Branch Telephone Number(___)_________ +
+ +
+ Authorized Signature, Securities Dealer _______________ Title ______________ +
+==============================================================================+
+ +
+ ACCEPTED: Franklin Templeton Distributors, Inc. By ____________ Date _______ +
+==============================================================================+
Please see reverse side for Shareholder Account Privileges:
<TABLE>
<S> <C> <C> <C>
[X] Distribution Options [X] Special Instructions for Distributions [X] Telephone Exchange Service [X] Letter of Intent
[X] Systematic Withdrawal Plan [X] Automatic Investment Plan [X] Cumulative Quantity Discount
</TABLE>
This application must be preceded or accompanied by a prospectus for the Fund(s)
being purchased.
<PAGE>
================================================================================
6. DISTRIBUTION OPTIONS (Check one)
================================================================================
Check one - if no box is checked, all dividends and capital gains will be
reinvested in additional shares of the Fund.
[_] Reinvest all dividends and capital gains.
[_] Pay capital gains in cash and reinvest dividends.
[_] Pay all dividends in cash and reinvest capital gains.
[_] Pay all dividends and capital gains in cash.
================================================================================
7. OPTIONAL SHAREHOLDER PRIVILEGES
================================================================================
A. SPECIAL PAYMENT INSTRUCTIONS FOR DISTRIBUTIONS (Check one box)
[_] Pay Distributions, as noted in Section 6, to another Franklin or Templeton
Fund.
Fund Name ____________________________ Existing Account Number ____________
[_] Send my Distributions to the person, named below, instead of as registered
in Section 1.
Name ___________________________ Street Address ___________________________
City ___________________________ State _________________ Zip Code _________
================================================================================
B. SYSTEMATIC WITHDRAWAL PLAN
Please withdraw from my Franklin Templeton account $_______($50 minimum)
[_] Monthly [_] Quarterly [_] Semi-Annually or [_] Annually as set forth in
the Prospectus, starting in __________________(Month).
Send the proceeds to: [_] Address of Record OR [_] the Franklin Templeton
Fund or person specified in Section 7(A) - Special Payment Instructions for
Distributions.
================================================================================
C. TELEPHONE TRANSACTIONS
Telephone Exchange Privilege: If the Fund does not receive specific
instructions from the shareholder, either in writing or by telephone, the
Telephone Exchange Privilege (see the prospectus) is automatically extended
to each account. The shareholder should understand, however, that the Fund
and Franklin Templeton Investor Services, Inc. ("FTI") or Templeton Funds
Trust Company and their agents will not be liable for any loss, injury,
damage or expense as a result of acting upon instructions communicated by
telephone reasonably believed to be genuine. The shareholder agrees to hold
the Fund and its agents harmless from any loss, claims, or liability arising
from its or their compliance with such instructions. The shareholder
understands that this option is subject to the terms and conditions set
forth in the prospectus of the fund to be acquired.
[_] No, I do NOT wish to participate in the Telephone Exchange Privilege or
authorize the Fund or its agents, including FTI or Templeton Funds Trust
Company, to act upon instructions received by telephone to exchange shares
for shares of any other account(s) within the Franklin Templeton Group of
Funds.
Telephone Redemption Privilege: This is available to shareholders who
specifically request it and who complete the Franklin Templeton Telephone
Redemption Authorization Agreement in the back of the Fund's prospectus.
================================================================================
D. AUTOMATIC INVESTMENT PLAN
Important: Attach an unassigned, voided check (for Checking Accounts) or a
Savings Account deposit slip here, and complete the information below.
I(We) would like to establish an Automatic Investment Plan (the "Plan") as
described in the Prospectus. I(We) agree to reimburse FTI and/or FTD for any
expenses or losses that they may incur in connection with my(our) Plan,
including any caused by my(our) bank's failure to act in accordance with
my(our) request. If my(our) bank makes any erroneous payment or fails to
make a payment after shares are purchased on my(our) behalf, any such
purchase may be cancelled and I(we) hereby authorize redemptions and/or
deductions from my(our) account for that purpose.
Debit my(our) bank account monthly for $______($25 minimum) on or about
the [_] 1st [_] 5th [_] 15th or [_] 20th day starting _____________ (month),
to be invested in (name of Fund)__________________________ Account Number
(if known)_____________________
================================================================================
E. INSTRUCTIONS TO BANK - AUTOMATIC INVESTMENT PLAN AUTHORIZATION
To: __________________________________ __________________________________
Name of Your Bank ABA Number
_______________________________ __________________ ___________ ___________
Street Address City State Zip Code
I(we) authorize you to charge my(our) Checking/Savings Account and to make
payment to FTD, upon instructions from FTD. I(We) agree that in making
payment for such charges your rights shall be the same as if each were a
charge made and signed personally by me(us). This authority shall remain in
effect until you receive written notice from me(us) changing its terms or
revoking it. Until you actually receive such notice, I(we) agree that you
shall be fully protected in paying any charges under this authority. I(we)
further agree that if any such charge is not made, whether with or with out
cause and whether intentionally or inadvertently, you shall be under no
liability whatsoever.
X_____________________________________________________ ___________________
Signature(s) EXACTLY as shown on your bank records Date
________________________________________________ _________________________
Print Name(s) Account Number
_______________________________ __________________ ___________ ___________
Your Street Address City State Zip Code
================================================================================
F. LETTER OF INTENT (LOI)
[_] I(We) agree to the terms of the LOI and provisions for reservations of
shares and grant FTD the security interest set forth in the Prospectus.
Although I am (we are) not obligated to do so, it is my(our) intention to
invest over a 13 month period in shares of one or more Franklin or Templeton
Funds (including all Money Market Funds in the Franklin Templeton Group) an
aggregate amount at least equal to that which is checked below:
[_] $50,000-99,999 (except for Income Fund)
[_] $100,000-249,999
[_] $250,000-499,999
[_] $500,000-999,999
[_] $1,000,000 or more
Purchases made within the last 90 days will be included as part of your LOI.
Please write in your Account Number(s) ___________ ___________ __________
================================================================================
G. CUMULATIVE QUANTITY DISCOUNT
Shares may be purchased at the Offering Price applicable to the dollar
amount of the sale added to the higher of (1) the value (calculated at the
applicable Offering Price) or (2) the purchase price, of any other Shares of
the Fund and/or other Funds in the Franklin Templeton Group owned at that
time by the purchaser, his or her spouse, and their children under age 21,
including all Money Market Funds in the Franklin Templeton Group as stated
in the Prospectus. In order for this Cumulative Quantity Discount to be made
available, the Shareholder or his or her Securities Dealer must notify FTI
or FTD of the total holdings in the Franklin Templeton Group each time an
order is placed.
[_] I(We) own shares of more than one Fund in the Franklin Templeton Group and
qualify for the Cumulative Quantity Discount described above and in the
Prospectus.
My(Our) other Account Number(s) are ____________ ____________ ____________
================================================================================
8. ACCOUNT REVISION (If Applicable)
If you are using this application to revise your Account Registration, or
wish to have Distributions sent to an address other than the address on your
existing Account's Registration, a Signature Guarantee is required.
Signatures of all registered owners must be guaranteed by an "eligible
guarantor" as defined in the "How to Sell Shares of the Fund" section in the
Fund's Prospectus. A Notary Public is not an acceptable guarantor.
X__________________________________________ ______________________________
Signature(s) of Registered Account Owners Account Number(s)
X__________________________________________ ______________________________
X__________________________________________
X__________________________________________ ______________________________
Signature Guarantee Stamp
NOTE: For any change in registration, please send us any outstanding
Certificates by Registered Mail.
================================================================================
