As filed with the Securities and Exchange Commission on October 26, 2000.
File Nos.
33-88924
811-8962
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No.
Post-Effective Amendment No. 7 (X)
----
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
Amendment No. 9 (X)
----
FRANKLIN TEMPLETON MONEY FUND TRUST
-----------------------------------
(Exact Name of Registrant as Specified in Charter)
777 MARINERS ISLAND BLVD., SAN MATEO, CALIFORNIA 94404
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (650) 312-2000
--------------
MURRAY L. SIMPSON, 777 MARINERS ISLAND BLVD., SAN MATEO, CA. 94404
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(Name and Address of Agent for Service of Process)
Approximate Date of Proposed Public Offering:
It is proposed that this filing will become effective (check appropriate box)
[ ] immediately upon filing pursuant to paragraph (b)
[x] on November 1, 2000 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date), pursuant to paragraph (a)(2) of Rule 485
If appropriate, check the following box:
[ ] This post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
The Money Market Portfolios (the Master Fund) has executed this registration
statement.
Prospectus
Franklin Templeton Money Fund
Franklin Templeton Money Fund Trust
CLASS B & C
INVESTMENT STRATEGY Income
NOVEMBER 1, 2000
[Insert Franklin Templeton Ben Head]
The SEC has not approved or disapproved these securities or passed upon the
adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
CONTENTS
THE FUND
[Begin callout]
INFORMATION ABOUT THE FUND YOU SHOULD KNOW BEFORE INVESTING
[End callout]
2 Goal and Strategies
4 Main Risks
5 Performance
6 Fees and Expenses
7 Management
8 Distributions and Taxes
9 Financial Highlights
YOUR ACCOUNT
[Begin callout]
INFORMATION ABOUT ACCOUNT TRANSACTIONS AND SERVICES
[End callout]
10 Buying Shares
12 Investor Services
14 Selling Shares
17 Account Policies
19 Questions
FOR MORE INFORMATION
[Begin callout]
WHERE TO LEARN MORE ABOUT THE FUND
[End callout]
Back Cover
THE FUND
[Insert graphic of bullseye and arrows] GOAL AND STRATEGIES
-------------------
GOAL The Fund's investment goal is to provide investors with as high a level
of current income as is consistent with the preservation of shareholders'
capital and liquidity. The Fund also tries to maintain a stable $1 share
price.
MAIN INVESTMENT STRATEGIES The Fund seeks to achieve its investment goal by
investing all of its assets in shares of The Money Market Portfolio
(Portfolio). The Portfolio has the same investment goal and substantially
similar investment policies as the Fund; it invests in high-quality,
short-term U.S. dollar denominated money market securities of domestic and
foreign issuers, including:
BANK OBLIGATIONS and instruments secured by bank obligations, which include
fixed, floating or variable rate certificates of deposit, letters of credit,
time deposits, bank notes and bankers' acceptances. From time to time, the
Fund may concentrate its investments in bank obligations (such as
certificates of deposits) issued by domestic banks. Investments in
obligations of U.S. branches of foreign banks are considered domestic banks
if such branches have a federal or state charter to do business in the U.S.
and are subject to U.S. regulatory authorities.
o CERTIFICATES OF DEPOSITS, which are bank obligations that are issued
against money deposited in a banking institution for a specified period of
time at a specified interest rate.
COMMERCIAL PAPER, which is a short-term obligation of a bank, corporation or
other borrower with a maturity of up to 270 days. Commercial paper may also
be asset backed (that is, backed by a pool of assets representing the
obligations of a number of different parties). At any time, the Fund may have
a significant portion of its investments in asset-backed commercial paper.
REPURCHASE AGREEMENTS, which are agreements to buy a security and then to
sell the security back after a short period of time (generally, less than
seven days) at a higher price.
U.S. GOVERNMENT SECURITIES, which include marketable fixed, floating and
variable rate securities issued or guaranteed by the U.S. government or its
agencies, or by various instrumentalities that have been established or
sponsored by the U.S. government.
PORTFOLIO MATURITY AND QUALITY The Fund maintains a dollar-weighted average
portfolio maturity of 90 days or less and only buys securities:
o with remaining maturities of 397 days or less, and
o that the manager determines present minimal credit risks and are rated in
the top two short-term ratings by U.S. nationally recognized rating
services (or comparable unrated securities).
[Insert graphic of chart with line going up and down] MAIN RISKS
----------
FINANCIAL SERVICES COMPANIES Financial services companies such as banks are
highly dependent on the supply of short-term financing. The value of
securities issued by financial services companies can be sensitive to changes
in government regulation and interest rates and to economic downturns in the
U.S. and overseas.
INCOME Since the Fund can only distribute what it earns, the Fund's
distributions to shareholders may decline when interest rates fall. Because
the Fund limits its investments to high-quality, short-term securities, its
portfolio generally will earn lower yields than a portfolio with
lower-quality, longer-term securities subject to more risk.
INTEREST RATE Changes in interest rates can be sudden and unpredictable.
Rate changes occur in response to general economic conditions and also as a
result of actions by the Federal Reserve Board. A reduction in short-term
interest rates will normally result in reduced interest income to the Fund
and thus a reduction in dividends payable to shareholders. An increase in
short-term interest rates will normally have the effect of increasing
dividends to shareholders.
More detailed information about the Fund, its policies and risks can be found
in the Fund's Statement of Additional Information (SAI).
[Begin callout]
Mutual fund shares are not deposits or obligations of, or guaranteed or
endorsed by, any bank, and are not insured by the Federal Deposit Insurance
Corporation, the Federal Reserve Board, or any other agency of the U.S.
government. Although the Fund tries to maintain a $1 share price, it is
possible to lose money by investing in the Fund.
[End callout]
[Insert graphic of a bull and a bear] PERFORMANCE
-----------
This bar chart and table show the volatility of the Fund's returns, which is
one indicator of the risks of investing in the Fund. The bar chart shows
changes in the Fund's returns from year to year over the past 4 calendar
years. The table shows the Fund's average annual total returns. Of course,
past performance cannot predict or guarantee future results.
CLASS C ANNUAL TOTAL RETURNS1
[Insert bar graph]
4.22% 4.36% 4.37% 4.17%
96 97 98 99
YEAR
[Begin callout]
BEST QUARTER:
Q4 '99 1.16%
WORST QUARTER:
Q2 '99 0.94%
[End callout]
AVERAGE ANNUAL TOTAL RETURNS
For the periods ended December 31, 1999
SINCE
1 YEAR INCEPTION
(1/1/99)
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Franklin Templeton Money Fund - 4.10% 4.10%
Class B
SINCE
1 YEAR INCEPTION
(5/1/95)
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Franklin Templeton Money Fund - 4.17% 4.23%
Class C
1. As of September 30, 2000, the Fund's year-to-date return was 3.92% for
Class C.
All Fund performance assumes reinvestment of dividends.
To obtain the Fund's current yield information, please call 1-800/DIAL BEN(R).
[Insert graphic of percentage sign] FEES AND EXPENSES
-----------------
This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.
SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT)
CLASS B 1 CLASS C
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Maximum sales charge (load) on None None
purchases
Maximum deferred sales charge (load) 4.00% 1.00%
Please see "Selling Shares" on page 14 for an explanation of how and when
the deferred sales charge applies.
ANNUAL FUND OPERATING EXPENSES (EXPENSES DEDUCTED FROM FUND ASSETS) 1
CLASS B CLASS C
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Management fees 2 0.60% 0.60%
Distribution and service
(12b-1) fees 0.65% 0.53%
Other expenses 0.28% 0.28%
-----------------------------
Total annual Fund operating 1.53% 1.41%
expenses 2 -----------------------------
1. The annual Fund operating expenses shown and included in the example below
reflect the expenses of both the Fund and The Money Market Portfolio.
2. For the fiscal year ended June 30, 2000, the manager had agreed in advance
to limit its fees. With this reduction, management fees were 0.32% and total
annual Fund operating expenses were 1.25% for Class B and 1.13% for Class C.
The manager may end this arrangement at any time upon notice to the Fund's
Board of Trustees.
EXAMPLE
This example can help you compare the cost of investing in the Fund with the
cost of investing in other mutual funds. It assumes:
o You invest $10,000 for the periods shown;
o Your investment has a 5% return each year; and
o The Fund's operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
----------------------------------------------------------------------
If you sell your shares at
the end of the period:
CLASS B $556 $783 $1,034 $1,830
CLASS C $244 $446 $771 $1,691
If you do not sell your
shares:
CLASS B $156 $483 $834 $1,830
CLASS C $144 $446 $771 $1,691
[Insert graphic of briefcase] MANAGEMENT
Franklin Advisers, Inc. (Advisers), 777 Mariners Island Blvd., San Mateo, CA
94404, is The Money Market Portfolio's investment manager and the Fund's
administrator. Together, Advisers and its affiliates manage over $236 billion
in assets.
The Portfolio pays Advisers a fee for managing the Portfolio's assets. For
the fiscal year ended June 30, 2000, the Fund's share of the Portfolio's
management fees, before any advance waiver, was 0.15% of the Fund's average
daily net assets. Under an agreement by the manager to limit its fees, the
Fund's share was 0.14% of its average daily net assets. The manager may end
this arrangement at any time upon notice to the Fund's Board of Trustees.
[Insert graphic of dollar
signs and stacks of coins] DISTRIBUTIONS AND TAXES
-----------------------
INCOME DISTRIBUTIONS The Fund typically pays income dividends each day that
its net asset value is calculated. Your account may begin to receive
dividends on the day after we receive your investment and will continue to
receive dividends through the day we receive a request to sell your shares.
The amount of these dividends will vary and there is no guarantee the Fund
will pay dividends.
TAX CONSIDERATIONS In general, Fund distributions are taxable to you as
ordinary income. This is true whether you reinvest your distributions in
additional Fund shares or receive them in cash.
[Begin callout]
BACKUP WITHHOLDING
By law, the Fund must withhold 31% of your taxable distributions and
redemption proceeds if you do not provide your correct social security or
taxpayer identification number and certify that you are not subject to backup
withholding, or if the IRS instructs the Fund to do so.
[End callout]
Every January, you will receive a statement that shows the tax status of
distributions you received for the previous year. Distributions declared in
December but paid in January are taxable as if they were paid in December.
For tax purposes, an exchange of your Fund shares for shares of a different
Franklin Templeton fund is the same as a sale. Because the Fund expects to
maintain a stable $1 share price, you should not have any gain or loss if you
sell your Fund shares.
Fund distributions generally will be subject to state and local taxes. The
Fund does not anticipate that any of its distributions will qualify for
exemption from state and local taxes as dividends from interest on U.S.
government securities. Non-U.S. investors may be subject to U.S. withholding
and estate tax. You should consult your tax advisor about the federal, state,
local or foreign tax consequences of your investment in the Fund.
[Insert graphic of a dollar bill] FINANCIAL HIGHLIGHTS
--------------------
This table presents the Fund's financial performance for the past five years.
This information has been audited by PricewaterhouseCoopers LLP.
CLASS B YEAR ENDED JUNE 30,
-------------------------------------------------
2000 1999 1
-------------------------------------------------
PER SHARE DATA ($)
Net asset value,
beginning of year 1.00 1.00
------------------
Net investment income .045 .019
Distributions from net
investment income (.045) (.019)
------------------
Net asset value, end of 1.00 1.00
year
------------------
Total return (%) 2 4.64 1.88
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year
($ x 1,000) 5,439 762
Ratios to average net
assets: (%)
Expenses 3 1.25 1.26 4
Expenses excluding
waiver and payments by 1.52 1.46 4
affiliate3
Net investment income 4.54 3.73 4
CLASS C YEAR ENDED JUNE 30,
---------------------------------------------------------------------
2000 1999 1998 1997 1996
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PER SHARE DATA ($)
Net asset value,
beginning of year 1.00 1.00 1.00 1.00 1.00
-----------------------------------------
Net investment income .046 .040 .043 .042 .039
Distributions from net
investment income (.046) (.040) (.043) (.042) (.039)
-----------------------------------------
Net asset value, end of 1.00 1.00 1.00 1.00 1.00
year
-----------------------------------------
Total return (%) 2 4.75 4.08 4.43 4.29 3.96
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year
($ x 1,000) 82,406 77,667 38,538 9,724 4,510
Ratios to average net
assets: (%)
Expenses 3 1.13 1.22 1.25 1.25 1.40
Expenses excluding
waiver and payments by 1.40 1.42 1.45 1.59 2.67
affiliate 3
Net investment income 4.66 4.00 4.39 4.26 4.00
1. For the period January 1, 1999 (effective date) to June 30, 1999.
2. Total return is not annualized.
3. The expense ratio includes the Fund's share of the Portfolio's allocated
expenses.
4. Annualized.
YOUR ACCOUNT
[Insert graphic of a paper with lines
and someone writing] BUYING SHARES
-------------
[Begin callout]
FRANKLIN TEMPLETON FUNDS include all of the U.S. registered mutual funds of
Franklin Templeton Investments, except Franklin Templeton Variable Insurance
Products Trust and Templeton Capital Accumulator Fund, Inc.
[End callout]
You may buy shares of the Fund only in exchange for Class B or C shares of
other Franklin Templeton funds sold subject to a contingent deferred sales
charge or through the reinvestment of dividends. Shares of the Fund may not
be purchased directly. Unlike other money funds, the Fund does not have check
writing privileges.
MINIMUM INVESTMENTS
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INITIAL ADDITIONAL
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Regular accounts $1,000 $50
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Automatic investment plans $50 ($25 $50
for an ($25 for an
Education Education
IRA) IRA)
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UGMA/UTMA accounts $100 $50
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Retirement accounts no minimum no minimum
(other than IRAs, IRA rollovers,
Education IRAs or Roth IRAs)
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IRAs, IRA rollovers, Education IRAs or
Roth IRAs $250 $50
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Broker-dealer sponsored wrap account
programs $250 $50
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Full-time employees, officers,
trustees and directors of Franklin
Templeton entities, and their
immediate family members $100 $50
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PLEASE NOTE THAT YOU MAY ONLY BUY SHARES OF A FUND ELIGIBLE FOR SALE IN YOUR
STATE OR JURISDICTION.
DISTRIBUTION AND SERVICE (12B-1) FEES Class B has a distribution plan,
sometimes known as a Rule 12b-1 plan, that allows the Fund to pay
distribution and other fees of up to 0.65% per year for the sale of Class B
shares and for services provided to shareholders. Dealers may be eligible to
receive up to 0.15% of these fees from the date of purchase.
Class C also has a distribution plan that allows the Fund to pay distribution
and other fees of up to 0.65% per year for the sale of Class C shares and for
services provided to shareholders. During the first year after the initial
purchase of the Class C shares that were exchanged for shares of the Fund,
dealers may be eligible to receive up to 0.15% of these fees.
Because these fees are paid out of the assets of each class on an on-going
basis, over time these fees will increase the cost of your investment and may
cost you more than paying other types of sales charges.
BUYING SHARES
----------------------------------------------------------------------
OPENING AN ACCOUNT ADDING TO AN ACCOUNT
----------------------------------------------------------------------
[Insert graphic
of hands shaking]
Contact your investment Contact your investment
THROUGH YOUR representative representative
INVESTMENT
REPRESENTATIVE
[Insert graphic Call Shareholder Call Shareholder
of two arrows Services at the number Services at the number
pointing in below, or send signed below or our automated
opposite written instructions. TeleFACTS system, or
directions] The TeleFACTS system send signed written
cannot be used to open a instructions.
BY EXCHANGE new account.
(Please see page 13 for (Please see page 13 for
TeleFACTS(R) information on information on
1-800/247-1753 exchanges.) exchanges.)
(around-the-clock
access)
----------------------------------------------------------------------
FRANKLIN TEMPLETON INVESTOR SERVICES P.O. BOX 33096,
ST. PETERSBURG, FL 33733-8096
CALL TOLL-FREE: 1-800/632-2301
(MONDAY THROUGH FRIDAY 5:30 A.M. TO 5:00 P.M., PACIFIC TIME
SATURDAY 6:30 A.M. TO 2:30 P.M., PACIFIC TIME)
[Insert graphic of person with a headset] INVESTOR SERVICES
-----------------
DISTRIBUTION OPTIONS You may reinvest distributions you receive from the
Fund in an existing account in the same share class* of the Fund or another
Franklin Templeton fund. Any initial sales charges or contingent deferred
sales charges (CDSCs) will not apply if you reinvest your distributions
within 365 days. You can also have your distributions deposited in a bank
account, or mailed by check. Deposits to a bank account may be made by
electronic funds transfer.
[Begin callout]
For Franklin Templeton Bank & Trust retirement plans, special forms may be
needed to receive distributions in cash. Please call 1-800/527-2020 for
information.
[End callout]
Please indicate on your revision form the distribution option you have
chosen, otherwise we will reinvest your distributions in the same share class
of the Fund. If you choose not to reinvest your distributions, the Fund will
distribute distributions paid during the month as directed on the last
business day of each month.
*Shareholders may reinvest their distributions in Class A shares of any other
Franklin Templeton money fund.
RETIREMENT PLANS Franklin Templeton Investments offers a variety of
retirement plans for individuals and businesses. These plans require separate
applications and their policies and procedures may be different than those
described in this prospectus. For more information, including a free
retirement plan brochure or application, please call Retirement Services at
1-800/527-2020.
TELEFACTS(R) Our TeleFACTS system offers around-the-clock access to
information about your account or any Franklin Templeton fund. This service
is available from touch-tone phones at 1-800/247-1753. For a free TeleFACTS
brochure, call 1-800/DIAL BEN.
TELEPHONE PRIVILEGES You will automatically receive telephone privileges
when you open your account, allowing you and your investment representative
to sell or exchange your shares and make certain other changes to your
account by phone.
For accounts with more than one registered owner, telephone privileges also
allow the Fund to accept written instructions signed by only one owner for
transactions and account changes that could otherwise be made by phone. For
all other transactions and changes, all registered owners must sign the
instructions. In addition, our telephone exchange privilege allows you to
exchange shares by phone from a fund account requiring two or more signatures
into an identically registered money fund account requiring only one
signature for all transactions. This type of telephone exchange is available
as long as you have telephone exchange privileges on your account.
As long as we take certain measures to verify telephone requests, we will not
be responsible for any losses that may occur from unauthorized requests. Of
course, you can decline telephone exchange or redemption privileges on your
account application.
EXCHANGE PRIVILEGE You can exchange shares between most Franklin Templeton
funds within the same class, generally without paying any additional sales
charges.
[Begin callout]
An EXCHANGE is really two transactions: a sale of one fund and the purchase
of another. In general, the same policies that apply to purchases and sales
apply to exchanges, including minimum investment amounts. Exchanges also have
the same tax consequences as ordinary sales and purchases.
[End callout]
Generally exchanges may only be made between identically registered accounts,
unless you send written instructions with a signature guarantee. Any CDSC
will continue to be calculated from the date of your initial investment and
will not be charged at the time of the exchange. The purchase price for
determining a CDSC on exchanged shares will be the price you paid for the
original shares.
Because excessive trading can hurt fund performance, operations and
shareholders, the Fund reserves the right to revise or terminate the exchange
privilege, limit the amount or number of exchanges, reject any exchange, or
restrict or refuse purchases if (i) the Fund or its manager believes the Fund
would be harmed or unable to invest effectively, or (ii) the Fund receives or
anticipates simultaneous orders that may significantly affect the Fund
(please see "Market Timers" on page 18).
SYSTEMATIC WITHDRAWAL PLAN This plan allows you to automatically sell your
shares and receive regular payments from your account. A CDSC may apply to
withdrawals that exceed certain amounts. Certain terms and minimums apply. To
sign up, complete the appropriate section of the revision form.
[Insert graphic of a certificate] SELLING SHARES
--------------
You can sell your shares at any time.
SELLING SHARES IN WRITING Generally, requests to sell $100,000 or less can be
made over the phone or with a simple letter. Sometimes, however, to protect
you and the Fund we will need written instructions signed by all registered
owners, with a signature guarantee for each owner, if:
[Begin callout]
A SIGNATURE GUARANTEE helps protect your account against fraud.
You can obtain a signature guarantee at most banks and securities dealers.
A notary public CANNOT provide a signature guarantee.
[End callout]
o you are selling more than $100,000 worth of shares
o you want your proceeds paid to someone who is not a registered owner
o you want to send your proceeds somewhere other than the address of
record, or preauthorized bank or brokerage firm account
We also may require a signature guarantee on instructions we receive from an
agent, not the registered owners, or when we believe it would protect the
Fund against potential claims based on the instructions received.
SELLING RECENTLY PURCHASED SHARES If you sell shares recently purchased with
a check or draft, we may delay sending you the proceeds until your check or
draft has cleared, which may take seven business days or more. A certified or
cashier's check may clear in less time.
REDEMPTION PROCEEDS Your redemption check will be sent within seven days
after we receive your request in proper form. We are not able to receive or
pay out cash in the form of currency. Redemption proceeds may be delayed if
we have not yet received your signed account application.
RETIREMENT PLANS You may need to complete additional forms to sell shares in
a Franklin Templeton Bank & Trust retirement plan. For participants under age
591/2, tax penalties may apply. Call Retirement Services at 1-800/527-2020
for details.
CONTINGENT DEFERRED SALES CHARGE (CDSC) For Class B shares, there is a CDSC
if you sell your shares within six years from the date of purchase of the
shares that were exchanged for shares of the Fund, as described in the table
below.
IF YOU SELL YOUR CLASS B SHARES
WITHIN THIS MANY YEARS AFTER THIS % IS DEDUCTED
BUYING THEM FROM YOUR PROCEEDS AS A CDSC
------------------------------------------------------
1 Year 4
2 Years 4
3 Years 3
4 Years 3
5 Years 2
6 Years 1
7 Years 0
For Class C shares, there is a 1% CDSC on any shares you sell within 18
months from the date of purchase of the shares that were exchanged for shares
of the Fund.
[Begin callout]
The HOLDING PERIOD FOR THE CDSC begins on the day you buy your shares. Your
shares will age one month on that same date the next month and each following
month.
For example, if you buy shares on the 18th of the month, they will age one
month on the 18th day of the next month and each following month.
[End callout]
The CDSC for each class is based on the current value of the shares being
sold or their net asset value when purchased, whichever is less. To keep your
CDSC as low as possible, each time you place a request to sell shares we will
first sell any shares in your account that are not subject to a CDSC. If
there are not enough of these to meet your request, we will sell the shares
in the order they were purchased.
CDSC WAIVERS. The CDSC for each class may be waived for certain redemptions
and distributions. If you would like information about available sales charge
waivers, call your investment representative or call Shareholder Services at
1-800/632-2301. A list of available sales charge waivers also may be found in
the Statement of Additional Information (SAI).
SELLING SHARES
---------------------------------------------------------------
TO SELL SOME OR ALL OF YOUR SHARES
---------------------------------------------------------------
[Insert graphic of
hands shaking]
Contact your investment representative
THROUGH YOUR
INVESTMENT
REPRESENTATIVE
---------------------------------------------------------------
[Insert graphic of Send written instructions to Investor
envelope] Services. Corporate, partnership or
trust accounts may need to send
BY MAIL additional documents.
Specify the Fund, the account number
and the dollar value or number of
shares you wish to sell. Be sure to
include all necessary signatures and
any additional documents, as well as
signature guarantees if required.
A check will be mailed to the name(s)
and address on the account, or
otherwise according to your written
instructions.
---------------------------------------------------------------
[Insert graphic of As long as your transaction is for
phone] $100,000 or less, and you have not
changed your address by phone within
BY PHONE the last 15 days, you can sell your
shares by phone.
1-800/632-2301
A check will be mailed to the name(s)
and address on the account. Written
instructions, with a signature
guarantee, are required to send the
check to another address or to make it
payable to another person.
---------------------------------------------------------------
[Insert graphic of You can call or write to have
three lightning redemption proceeds sent to a bank
bolts] account. See the policies above for
selling shares by mail or phone.
Before requesting to have redemption
proceeds sent to a bank account, please
BY ELECTRONIC FUNDS make sure we have your bank account
TRANSFER (ACH) information on file. If we do not have
this information, you will need to send
written instructions with your bank's
name and address, a voided check or
savings account deposit slip, and a
signature guarantee if the bank and
Fund accounts do not have at least one
common owner.
If we receive your request in proper
form by 3:00 p.m. Pacific time,
proceeds sent by ACH generally will be
available within two to three business
days.
---------------------------------------------------------------
[Insert graphic of Obtain a current prospectus for the
two arrows pointing fund you are considering.
in opposite
directions] Call Shareholder Services at the number
below or our automated TeleFACTS
BY EXCHANGE system, or send signed written
instructions. See the policies above
TeleFACTS(R) for selling shares by mail or phone.
1-800/247-1753
(around-the-clock
access)
---------------------------------------------------------------
FRANKLIN TEMPLETON INVESTOR SERVICES P.O. BOX 33096,
ST. PETERSBURG, FL 33733-8096
CALL TOLL-FREE: 1-800/632-2301
(MONDAY THROUGH FRIDAY 5:30 A.M. TO 5:00 P.M., PACIFIC TIME
SATURDAY 6:30 A.M. TO 2:30 P.M., PACIFIC TIME)
[Insert graphic of paper and pen] ACCOUNT POLICIES
----------------
CALCULATING SHARE PRICE When you buy shares, you pay the net asset value
(NAV) per share. When you sell shares, you receive the NAV minus any
applicable contingent deferred sales charge (CDSC).
The Fund calculates its NAV per share at 3:00 p.m. Pacific time, each day the
New York Stock Exchange is open. Each class's NAV is calculated by dividing
its net assets by the number of its shares outstanding. The Fund's assets are
generally valued at their amortized cost.
Requests to buy and sell shares are processed at the NAV next calculated
after we receive your request in proper form.
ACCOUNTS WITH LOW BALANCES If the value of your account falls below $250
($50 for employee and UGMA/UTMA accounts) because you sell some of your
shares, we may mail you a notice asking you to bring the account back up to
its applicable minimum investment amount. If you choose not to do so within
30 days, we may close your account and mail the proceeds to the address of
record.You will not be charged a CDSC if your account is closed for this
reason.
STATEMENTS AND REPORTS You will receive monthly account statements that show
all your account transactions during the month. You also will receive written
notification after each transaction affecting your account (except for
distributions, transactions made through automatic investment or withdrawal
programs, and shares sold by check, which will be reported on your monthly
statement). You also will receive the Fund's financial reports every six
months. To reduce Fund expenses, we try to identify related shareholders in a
household and send only one copy of the financial reports. If you need
additional copies, please call 1-800/DIAL BEN.
If there is a dealer or other investment representative of record on your
account, he or she also will receive copies of all notifications and
statements and other information about your account directly from the Fund.
STREET OR NOMINEE ACCOUNTS You may transfer your shares from the street or
nominee name account of one dealer to another, as long as both dealers have
an agreement with Franklin Templeton Distributors, Inc. We will process the
transfer after we receive authorization in proper form from your delivering
securities dealer.
JOINT ACCOUNTS Unless you specify a different registration, accounts with
two or more owners are registered as "joint tenants with rights of
survivorship" (shown as "Jt Ten" on your account statement). To make any
ownership changes to a joint account, all owners must agree in writing,
regardless of the law in your state.
MARKET TIMERS The Fund may restrict or refuse purchases or exchanges by
Market Timers. You may be considered a Market Timer if you have (i) requested
an exchange out of any of the Franklin Templeton funds within two weeks of an
earlier exchange request out of any fund, or (ii) exchanged shares out of any
of the Franklin Templeton funds more than twice within a rolling 90 day
period, or (iii) otherwise seem to follow a market timing pattern that may
adversely affect the Fund. Accounts under common ownership or control with an
account that is covered by (i), (ii), or (iii) are also subject to these
limits.
Anyone, including the shareholder or the shareholder's agent, who is
considered to be a Market Timer by the Fund, its manager or shareholder
services agent, will be issued a written notice of their status and the
Fund's policies. Identified Market Timers will be required to register with
the market timing desk of Franklin Templeton Investor Services, Inc., and to
place all purchase and exchange trade requests through the desk. Some funds
do not allow investments by Market Timers.
ADDITIONAL POLICIES Please note that the Fund maintains additional policies
and reserves certain rights, including:
o The Fund may restrict or refuse any order to buy shares, including any
purchase under the exchange privilege.
o At any time, the Fund may change its investment minimums or waive or
lower its minimums for certain purchases.
o The Fund may modify or discontinue the exchange privilege on 60 days'
notice.
o In unusual circumstances, we may temporarily suspend redemptions, or
postpone the payment of proceeds, as allowed by federal securities laws.
o For redemptions over a certain amount, the Fund reserves the right, in
the case of an emergency, to make payments in securities or other assets of
the Fund, if the payment of cash proceeds by check, wire or electronic
funds transfer would be harmful to existing shareholders.
o To permit investors to obtain the current price, dealers are responsible
for transmitting all orders to the Fund promptly.
[Insert graphic of question mark]QUESTIONS
If you have any questions about the Fund or your account, you can write to us at
P.O. Box 33096, St. Petersburg, FL 33733-8096. You also can call us at one of
the following numbers. For your protection and to help ensure we provide you
with quality service, all calls may be monitored or recorded.
HOURS (PACIFIC TIME,
DEPARTMENT NAME TELEPHONE NUMBER MONDAY THROUGH FRIDAY)
-----------------------------------------------------------------
Shareholder Services 1-800/632-2301 5:30 a.m. to 5:00 p.m.
6:30 a.m. to 2:30 p.m. (Saturday)
Fund Information 1-800/DIAL BEN 5:30 a.m. to 5:00 p.m.
(1-800/342-5236) 6:30 a.m. to 2:30 p.m. (Saturday)
Retirement Services 1-800/527-2020 5:30 a.m. to 5:00 p.m.
Advisor Services 1-800/524-4040 5:30 a.m. to 5:00 p.m.
Institutional 1-800/321-8563 6:00 a.m. to 5:00 p.m.
Services
TDD (hearing 1-800/851-0637 5:30 a.m. to 5:00 p.m.
impaired)
TeleFACTS(R) 1-800/247-1753 (around-the-clock
(automated) access)
FOR MORE INFORMATION
You can learn more about the Fund in the following documents:
ANNUAL/SEMIANNUAL REPORT TO SHAREHOLDERS
Includes a discussion of recent market conditions and Fund strategies,
financial statements, detailed performance information, portfolio holdings
and the auditor's report.
STATEMENT OF ADDITIONAL INFORMATION (SAI)
Contains more information about the Fund, its investments and policies. It is
incorporated by reference (is legally a part of this prospectus).
For a free copy of the current annual/semiannual report or the SAI, please
contact your investment representative or call us at the number below.
FRANKLIN(R)TEMPLETON(R)
1-800/DIAL BEN(R) (1-800/342-5236)
TDD (Hearing Impaired) 1-800/851-0637
franklintempleton.com
You also can obtain information about the Fund by visiting the SEC's Public
Reference Room in Washington, D.C. (phone 1-202/942-8090) or the EDGAR
Database on the SEC's Internet site at http://www.sec.gov. You can obtain
copies of this information, after paying a duplicating fee, by writing to the
SEC's Public Reference Section, Washington, D.C. 20549-0102 or by electronic
request at the following E-mail address: [email protected].
Investment Company Act file #811-8962 511 P 11/00
FRANKLIN TEMPLETON MONEY FUND
FRANKLIN TEMPLETON MONEY FUND TRUST
CLASS B & C
STATEMENT OF ADDITIONAL INFORMATION
NOVEMBER 1, 2000
[Insert Franklin Templeton Ben Head]
P.O. BOX 33096, ST. PETERSBURG, FL 33733-8096 1-800/DIAL BEN(R)
---------------------------------------------------------------
This Statement of Additional Information (SAI) is not a prospectus. It
contains information in addition to the information in the Fund's prospectus.
The Fund's prospectus, dated November 1, 2000, which we may amend from time
to time, contains the basic information you should know before investing in
the Fund. You should read this SAI together with the Fund's prospectus.
The audited financial statements and auditor's report in the Fund's Annual
Report to Shareholders, for the fiscal year ended June 30, 2000, are
incorporated by reference (are legally a part of this SAI).
For a free copy of the current prospectus or annual report, contact your
investment representative or call 1-800/DIAL BEN (1-800/342-5236).
CONTENTS
Goal, Strategies and Risks............................... 2
Officers and Trustees.................................... 6
Management and Other Services............................ 9
Portfolio Transactions................................... 10
Distributions and Taxes.................................. 10
Organization, Voting Rights and Principal Holders........ 11
Buying and Selling Shares................................ 12
Pricing Shares........................................... 15
The Underwriter.......................................... 15
Performance.............................................. 16
Miscellaneous Information................................ 18
Description of Ratings................................... 18
MUTUAL FUNDS, ANNUITIES, AND OTHER INVESTMENT PRODUCTS:
o ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD, OR ANY OTHER AGENCY OF THE U.S. GOVERNMENT;
o ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, ANY BANK;
o ARE SUBJECT TO INVESTMENT RISKS, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
GOAL, STRATEGIES AND RISKS
The Fund seeks to achieve its investment goal by investing all of its assets
in shares of The Money Market Portfolio (Portfolio). The Portfolio has the
same investment goal and substantially similar investment policies as the
Fund, except, in all cases, the Fund may pursue its policies by investing in
a mutual fund with the same investment goal and substantially similar
policies and restrictions as the Fund. The Portfolio's investment
restrictions are the same as the Fund's, except as necessary to reflect the
Fund's policy to invest all of its assets in shares of the Portfolio.
Generally, the policies and restrictions discussed in this SAI and in the
prospectus apply when the Fund makes an investment. In most cases, the Fund
is not required to sell a security because circumstances change and the
security no longer meets one or more of the Fund's policies or restrictions.
If a percentage restriction or limitation is met at the time of investment, a
later increase or decrease in the percentage due to a change in the value or
liquidity of portfolio securities will not be considered a violation of the
restriction or limitation.
The Fund has adopted certain restrictions as fundamental policies. This means
they may only be changed if the change is approved by (i) more than 50% of
the Fund's outstanding shares or (ii) 67% or more of the Fund's shares
present at a shareholder meeting if more than 50% of the Fund's outstanding
shares are represented at the meeting in person or by proxy, whichever is
less.
A non-fundamental policy may be changed by the board of trustees without the
approval of shareholders.
As a money market fund, the Fund must follow certain procedures required by
federal securities laws that may be more restrictive than some of the Fund's
other policies or investment restrictions. With respect to diversification,
these procedures require that the Fund not invest more than 5% of its total
assets in securities of a single issuer, other than U.S. government
securities, although it may invest up to 25% of its total assets in
securities of a single issuer that are rated in the highest rating category
for a period of up to three business days after purchase. The Fund also must
not invest more than (a) the greater of 1% of its total assets or $1 million
in securities issued by a single issuer that are rated in the second highest
rating category; and (b) 5% of its total assets in securities rated in the
second highest rating category. These procedures are fundamental policies of
the Fund, except to the extent that the Fund invests all of its assets in
another registered investment company with the same investment objective and
substantially similar policies as the Fund.
FUNDAMENTAL INVESTMENT POLICIES
The Fund's investment goal is to provide investors with as high a level of
current income as is consistent with the preservation of shareholders'
capital and liquidity. The Fund also tries to maintain a stable $1 share
price.
The Fund directly or through its investment in the Portfolio may not:
1. Borrow money or mortgage or pledge any of its assets, except that
borrowings (and a pledge of assets therefore) for extraordinary or emergency
purposes may be made from banks in any amount up to 5% of the total asset
value.
2. Make loans, except (a) through the purchase of debt securities in
accordance with the investment objective and policies of the Portfolio, (b)
to the extent the entry into a repurchase agreement is deemed to be a loan,
or (c) by the loan of its portfolio securities in accordance with the
policies described below.
3. Acquire, lease or hold real estate, including real estate limited
partnerships, provided that this limitation shall not prohibit the purchase
of municipal and other debt securities secured by real estate or interests
therein.
4. Buy any securities "on margin" or sell any securities "short," except that
it may use such short-term credits as are necessary for the clearance of
transactions.
5. Invest in commodities and commodity contracts, puts, calls, straddles,
spreads, or any combination thereof, or interests in oil, gas, or other
mineral leases or exploration or development programs except that it may
purchase, hold and dispose of "obligations with puts attached," or write
covered call options in accordance with its stated investment policies.
6. Purchase securities in private placements or in other transactions, for
which there are legal or contractual restrictions on resale, except that, to
the extent this restriction is applicable, the Fund may purchase, in private
placements shares of another registered investment company having the same
investment objective and policies as the Fund.
7. Act as underwriter of securities issued by other persons except insofar as
the Fund may technically be deemed an underwriter under the federal
securities laws in connection with the disposition of portfolio securities,
except that all or substantially all of the assets of the Fund may be
invested in another registered investment company having the same investment
objective and policies as the Fund.
8. Purchase the securities of other investment companies, except in
connection with a merger, consolidation, acquisition, or reorganization;
provided that all or substantially all of the assets of the Fund may be
invested in another registered investment company having the same investment
objective and policies as the Fund.
9. Invest in any issuer for purposes of exercising control or management,
except that, to the extent this restriction is applicable, all or
substantially all of the assets of the Fund may be invested in another
registered investment company having the same investment objective and
policies as the Fund.
10. Purchase securities from or sell to the Fund's officers and trustees, or
any firm of which any officer or trustee is a member, as principal, or retain
securities of any issuer if, to the knowledge of the Fund, one or more of the
Fund's officers, trustees, or investment advisor own beneficially more than
1/2 of 1% of the securities of such issuer and all such officers and trustees
together own beneficially more than 5% of such securities.
11. Invest more than 25% of its assets in securities of any industry,
although for purposes of this limitation U.S. government obligations are not
considered to be part of any industry. This prohibition does not apply where
the Fund's policies, as described in the prospectus, state otherwise, and
further does not apply to the extent that the Fund invests all of its assets
in another registered investment company having the same investment objective
and policies.
NON-FUNDAMENTAL INVESTMENT POLICIES
The following non-fundamental policies apply to investments made by the Fund
through the Portfolio.
1. The Fund will invest in obligations or instruments issued by banks and
savings institutions with assets of at least $1 billion.
2. The Fund may not invest more than 10% of its assets in time deposits with
more than seven days to maturity.
3. The Fund may invest in an obligation issued by a branch of a bank only if
the parent bank has assets of at least $5 billion, and may invest only up to
25% of its assets in obligations of foreign branches of U.S. or foreign
banks. The Fund may invest more than 25% of its assets in certain domestic
bank obligations, including U.S. branches of foreign banks.
4. The Fund may not make any new investments while any outstanding loans
exceed 5% of its total assets.
5. The Fund may invest up to 10% of its assets in taxable municipal
securities.
6. The Fund only intends to buy stripped securities that are issued or
guaranteed by the U.S. Treasury or by an agency or instrumentality of the
U.S. government.
7. The Fund may not invest more than 10% of its net assets in illiquid
securities. Notwithstanding this limitation, the Fund may invest in
securities that cannot be offered to the public for sale without first being
registered under the Securities Act of 1933, as amended (1933 Act)
(restricted securities), where such investment is consistent with the Fund's
investment goal and the manager determines that there is a liquid
institutional or other market for such securities. For example, restricted
securities that may be freely transferred among qualified institutional
buyers pursuant to Rule 144A under the 1933 Act and for which a liquid
institutional market has developed will be considered liquid even though such
securities have not been registered pursuant to the 1933 Act.
8. The Fund may not invest more than 5% of its total assets in securities of
companies, including predecessors, that have been in continuous operation for
less than three years.
INVESTMENTS, TECHNIQUES, STRATEGIES AND THEIR RISKS
In trying to achieve its investment goals, the Fund through the Portfolio may
invest in the following types of securities or engage in the following types
of transactions, and can be subject to the following types of risks:
ASSET-BACKED SECURITIES in which the Fund may invest are typically commercial
paper backed by the loans or accounts receivable of an entity, such as a bank
or credit card company. The issuer intends to repay using the assets backing
the securities (once collected). Therefore, repayment depends largely on the
cash-flows generated by the assets backing the securities. Sometimes the
credit support for these securities is limited to the underlying assets. In
other cases it may be provided by a third party through a letter of credit or
insurance guarantee.
Repayment of these securities is intended to be obtained from an identified
pool of diversified assets, typically receivables related to a particular
industry, such as asset-backed securities related to credit card receivables,
automobile receivables, trade receivables or diversified financial assets.
The credit quality of most asset-backed commercial paper depends primarily on
the credit quality for the assets underlying the securities, how well the
entity issuing the securities is insulated from the credit risk of the
originator (or any other affiliated entities) and the amount and quality of
any credit support provided to the securities.
Asset-backed commercial paper is often backed by a pool of assets
representing the obligations of a number of different parties. To lessen the
effect of failures by obligors on these underlying assets to make payment,
the securities may contain elements of credit support. The credit support
falls into two categories: liquidity protection and protection against
ultimate default on the underlying assets. Liquidity protection refers to the
provision of advances, generally by the entity administering the pool of
assets, to ensure that scheduled payments on the underlying pool are made in
a timely fashion. Protection against ultimate default ensures payment on at
least a portion of the assets in the pool. This protection may be provided
through guarantees, insurance policies or letters of credit obtained from
third parties, through various means of structuring the transaction or
through a combination of these approaches. The degree of credit support
provided on each issue is based generally on historical information
respecting the level of credit risk associated with the payments. Delinquency
or loss that exceeds the anticipated amount could adversely impact the return
on an investment in an asset-backed security.
BANK OBLIGATIONS The Fund may invest in obligations of U.S. banks, foreign
branches of U.S. or foreign banks, and U.S. branches of foreign banks. These
obligations may include deposits that are fully insured by the U.S.
government, its agencies or instrumentalities, such as deposits in banking
and savings institutions up to the current limit of the insurance on
principal provided by the Federal Deposit Insurance Corporation. Deposits are
frequently combined in larger units by an intermediate bank or other
institution.
COMMERCIAL PAPER The Fund may invest in commercial paper of domestic or
foreign issuers.
CORPORATE OBLIGATIONS may include fixed, floating and variable rate bonds,
debentures or notes.
CREDIT An issuer of securities may be unable to make interest payments and
repay principal. Changes in an issuer's financial strength or in a
security's credit rating may affect a security's value. Some of the Fund's
portfolio securities may be supported by credit enhancements, which may be
provided by either U.S. or foreign banks and insurance companies. These
securities have the credit risk of the entity providing the credit support.
Credit support provided by a foreign bank or insurance company may be less
certain because of the possibility of adverse foreign economic, political or
legal developments that may affect the ability of that entity to meet its
obligations.
FOREIGN SECURITIES The value of foreign (and U.S.) securities is affected by
general economic conditions and individual company and industry earnings
prospects. While foreign securities may offer significant opportunities for
gain, they also involve additional risks that can increase the potential for
losses in the Fund.
The political, economic and social structures of some countries the Fund
invests in may be less stable and more volatile than those in the U.S. The
risks of investing in these countries include the possibility of the
imposition of exchange controls, expropriation, restrictions on removal of
currency or other assets, nationalization of assets and punitive taxes.
There may be less publicly available information about a foreign company or
government than about a U.S. company or public entity. Certain countries'
financial markets and services are less developed than those in the U.S. or
other major economies. As a result, they may not have uniform accounting,
auditing and financial reporting standards and may have less government
supervision of financial markets. Foreign securities markets may have
substantially lower trading volumes than U.S. markets, resulting in less
liquidity and more volatility than experienced in the U.S. Transaction costs
on foreign securities markets are generally higher than in the U.S. The
settlement practices may be cumbersome and result in delays that may affect
portfolio liquidity. The Fund may have greater difficulty exercising rights,
pursuing legal remedies, and obtaining judgments with respect to foreign
investments in foreign courts than with respect to domestic issuers in U.S.
courts.
ILLIQUID INVESTMENTS Illiquid securities are generally securities that cannot
be sold within seven days in the normal course of business at approximately
the amount at which the Fund has valued them. The Fund's board of trustees
will review the determination by the manager to treat a restricted security
as a liquid security on an ongoing basis, including, among others, the
following factors: (i) the frequency of trades and quotes for the security;
(ii) the number of dealers willing to buy or sell the security and the number
of other potential buyers; (iii) dealer undertakings to make a market in the
security; and (iv) the nature of the security and market place trades (e.g.,
the time needed to dispose of the security, the method of soliciting offers,
and the mechanics of transfer). To the extent the Fund invests in restricted
securities that are deemed liquid, the general level of illiquidity in the
Fund may be increased if qualified institutional buyers become uninterested
in buying these securities or the market for these securities contracts. The
Fund's board of trustees will consider appropriate actions, consistent with
the Fund's goals and policies, if a security becomes illiquid after purchase.
INTEREST RATE As a general rule, when interest rates rise, debt securities
can lose market value. Similarly, when interest rates fall, debt securities
can gain value. However, because the length of time to maturity of the money
market instruments in the Fund's portfolio is very short, it is unlikely to
be affected by interest rate changes in this way except in the case of
unexpectedly large interest rate changes over a very short period of time.
LOANS OF PORTFOLIO SECURITIES To generate additional income, the Fund may
lend certain of its portfolio securities to qualified banks and
broker-dealers. These loans may not exceed 33 1/3% of the value of the Fund's
total assets, measured at the time of the most recent loan. For each loan,
the borrower must maintain with the Fund's custodian collateral (consisting
of any combination of cash, securities issued by the U.S. government and its
agencies and instrumentalities, or irrevocable letters of credit) with a
value at least equal to 102% of the current market value of the loaned
securities. The Fund retains all or a portion of the interest received on
investment of the cash collateral or receives a fee from the borrower. The
Fund also continues to receive any distributions paid on the loaned
securities. The Fund may terminate a loan at any time and obtain the return
of the securities loaned within the normal settlement period for the security
involved.
As with other extensions of credit, there are risks of delay in recovery or
even loss of rights in collateral in the event of default or insolvency of
the borrower. The Fund will loan its securities only to parties who meet
creditworthiness standards approved by the Fund's board of trustees, i.e.,
banks or broker-dealers that the manager has determined present no serious
risk of becoming involved in bankruptcy proceedings within the time frame
contemplated by the loan.
MASTER/FEEDER The Fund's structure, where it invests all of its assets in
the Portfolio, is sometimes known as a "master/feeder" structure. By
investing all of its assets in shares of the Portfolio, the Fund, other
mutual funds and institutional investors can pool their assets. This may
result in asset growth and lower expenses, although there is no guarantee
this will happen.
If the Fund, as a shareholder of the Portfolio, has to vote on a matter
relating to the Portfolio, it will hold a meeting of Fund shareholders and
will cast its votes in the same proportion as the Fund's shareholders voted.
There are some risks associated with the Fund's master/feeder structure. If
other shareholders in the Portfolio sell their shares, the Fund's expenses
may increase. Additionally, any economies of scale the Fund has achieved as a
result of the structure may be diminished. Institutional investors in the
Portfolio that have a greater pro rata ownership interest in the Portfolio
than the Fund could also have effective voting control.
If the Portfolio changes its investment goal or any of its fundamental
policies and Fund shareholders do not approve the same change for the Fund,
the Fund may need to withdraw its investment from the Portfolio. Likewise, if
the board of trustees considers it to be in the Fund's best interest, it may
withdraw the Fund's investment from the Portfolio at any time. If either
situation occurs, the board will decide what action to take. Possible
solutions might include investing all of the Fund's assets in another pooled
investment entity with the same investment goal and policies as the Fund, or
hiring an investment manager to manage the Fund's investments. Either
circumstance could increase the Fund's expenses.
MUNICIPAL SECURITIES Municipal securities are issued by or on behalf of
states, territories or possessions of the U.S., the District of Columbia, or
their political subdivisions, agencies or instrumentalities. They are
generally issued to raise money for various public purposes, such as
constructing public facilities and making loans to public institutions.
Certain types of municipal securities are issued to provide funding for
privately operated facilities and are generally taxable.
REPURCHASE AGREEMENTS Under a repurchase agreement, the Fund agrees to buy
securities guaranteed as to payment of principal and interest by the U.S.
government or its agencies from a qualified bank or broker-dealer and then to
sell the securities back to the bank or broker-dealer after a short period of
time (generally, less than seven days) at a higher price. The bank or
broker-dealer must transfer to the Fund's custodian securities with an
initial market value of at least 102% of the dollar amount invested by the
Fund in each repurchase agreement. The manager will monitor the value of such
securities daily to determine that the value equals or exceeds the repurchase
price.
Repurchase agreements may involve risks in the event of default or insolvency
of the bank or broker-dealer, including possible delays or restrictions upon
the Fund's ability to sell the underlying securities. The Fund will enter
into repurchase agreements only with parties who meet certain
creditworthiness standards, i.e., banks or broker-dealers that the manager
has determined present no serious risk of becoming involved in bankruptcy
proceedings within the time frame contemplated by the repurchase transaction.
STRIPPED SECURITIES are the separate income and principal components of debt
securities. Once the securities have been stripped they are referred to as
zero coupon securities. Their risks are similar to those of other money
market securities although they may be more volatile. Stripped securities do
not make periodic payments of interest prior to maturity and the stripping of
the interest coupons causes them to be offered at a discount from their face
amount. This results in the securities being subject to greater fluctuations
in response to changing interest rates than interest-paying securities of
similar maturities.
These risks also include, among others, the risk that the price movements in
the underlying securities correlate with price movements in the relevant
portion of the Fund's portfolio. The Fund either bears the risk in the same
amount as the instrument it has purchased, or there may be a negative
correlation that would result in a loss on both the underlying security and
the stripped security.
TIME DEPOSITS are non-negotiable deposits that are held in a banking
institution for a specified time at a stated interest rate.
U.S. GOVERNMENT SECURITIES Some U.S. government securities, including U.S.
Treasury bills, notes and bonds and securities of the Government National
Mortgage Association, are issued or guaranteed by the U.S. government or
carry a guarantee that is supported by the full faith and credit of the U.S.
government. Other U.S. government securities are issued or guaranteed by
federal agencies or government-sponsored enterprises and are not considered
direct obligations of the U.S. government. Instead, they involve sponsorship
or guarantees by government agencies or enterprises. For example, some
securities are supported by the right of the issuer to borrow from the U.S.
Treasury, such as obligations of the Federal Home Loan Bank. Others, such as
obligations of the Federal Farm Credit Banks Funding Corporation, are
supported only by the credit of the instrumentality.
VARIABLE MASTER DEMAND NOTES are a type of commercial paper. They are direct
arrangements between a lender and a borrower that allow daily changes to the
amount borrowed and to the interest rate. The Fund, as lender, may increase
or decrease the amount provided by the note agreement, and the borrower may
repay up to the full amount of the note without penalty. Typically, the
borrower may also set the interest rate daily, usually at a rate that is the
same or similar to the interest rate on other commercial paper issued by the
borrower. The Fund does not have any limit on the amount of its assets that
may be invested in variable master demand notes and may invest only in
variable master demand notes of U.S. issuers.
Because variable master demand notes are direct lending arrangements between
the lender and the borrower, they generally are not traded and do not have a
secondary market. They are, however, redeemable at face value plus accrued
interest at any time, although the Fund's ability to redeem a note is
dependent on the ability of the borrower to pay the principal and interest on
demand. When determining whether to invest in a variable master demand note,
the manager considers, among other things, the earnings power, cash flow and
other liquidity ratios of the issuer.
WHEN-ISSUED OR DELAYED-DELIVERY TRANSACTIONS are those where payment and
delivery for the security take place at a future date. Since the market price
of the security may fluctuate during the time before payment and delivery,
the Fund assumes the risk that the value of the security at delivery may be
more or less than the purchase prices. When the Fund is the buyer in the
transaction, it will maintain cash or liquid securities, with an aggregate
value equal to the amount of its purchase commitments, in a segregated
account with its custodian bank until payment is made. The Fund will not
engage in when-issued and delayed-delivery transactions for investment
leverage purposes.
OFFICERS AND TRUSTEES
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The Trust has a board of trustees. The board is responsible for the overall
management of the Trust, including general supervision and review of the
Fund's investment activities. The board, in turn, elects the officers of the
Trust who are responsible for administering the Trust's day-to-day
operations. The board also monitors the Fund to ensure no material conflicts
exist among share classes. While none is expected, the board will act
appropriately to resolve any material conflict that may arise.
The name, age and address of the officers and board members, as well as their
affiliations, positions held with the Trust, and principal occupations during
the past five years are shown below.
Frank H. Abbott, III (79)
1045 Sansome Street, San Francisco, CA 94111
TRUSTEE
President and Director, Abbott Corporation (an investment company); director
or trustee, as the case may be, of 29 of the investment companies in Franklin
Templeton Investments; and FORMERLY, Director, MotherLode Gold Mines
Consolidated (gold mining) (until 1996) and Vacu-Dry Co. (food processing)
(until 1996).
Harris J. Ashton (68)
191 Clapboard Ridge Road, Greenwich, CT 06830
TRUSTEE
Director, RBC Holdings, Inc. (bank holding company) and Bar-S Foods (meat
packing company); director or trustee, as the case may be, of 48 of the
investment companies in Franklin Templeton Investments; and FORMERLY,
President, Chief Executive Officer and Chairman of the Board, General Host
Corporation (nursery and craft centers) (until 1998).
S. Joseph Fortunato (68)
Park Avenue at Morris County, P.O. Box 1945
Morristown, NJ 07962-1945
TRUSTEE
Member of the law firm of Pitney, Hardin, Kipp & Szuch; and director or
trustee, as the case may be, of 50 of the investment companies in Franklin
Templeton Investments.
*Charles B. Johnson (67)
777 Mariners Island Blvd., San Mateo, CA 94404
CHAIRMAN OF THE BOARD AND TRUSTEE
Chairman of the Board, Chief Executive Officer, Member - Office of the
Chairman and Director, Franklin Resources, Inc.; Chairman of the Board and
Director, Franklin Investment Advisory Services, Inc.; Vice President,
Franklin Templeton Distributors, Inc.; Director, Franklin/Templeton Investor
Services, Inc. and Franklin Templeton Services, Inc.; officer and/or director
or trustee, as the case may be, of most of the other subsidiaries of Franklin
Resources, Inc. and of 49 of the investment companies in Franklin Templeton
Investments.
*Rupert H. Johnson, Jr. (60)
777 Mariners Island Blvd., San Mateo, CA 94404
PRESIDENT AND TRUSTEE
Vice Chairman, Member - Office of the Chairman and Director, Franklin
Resources, Inc.; Executive Vice President and Director, Franklin Templeton
Distributors, Inc.; Director, Franklin Advisers, Inc., Franklin Investment
Advisory Services, Inc. and Franklin/Templeton Investor Services, Inc.;
Senior Vice President, Franklin Advisory Services, LLC; and officer and/or
director or trustee, as the case may be, of most of the other subsidiaries of
Franklin Resources, Inc. and of 52 of the investment companies in Franklin
Templeton Investments.
Frank W.T. LaHaye (71)
20833 Stevens Creek Blvd., Suite 102, Cupertino, CA 95014
TRUSTEE
Chairman, Peregrine Venture Management Company (venture capital); Director,
The California Center for Land Recycling (redevelopment); director or
trustee, as the case may be, of 29 of the investment companies in Franklin
Templeton Investments; and FORMERLY, General Partner, Miller & LaHaye and
Peregrine Associates, the general partners of Peregrine Venture funds.
Gordon S. Macklin (72)
8212 Burning Tree Road, Bethesda, MD 20817
TRUSTEE
Director, Martek Biosciences Corporation, WorldCom, Inc. (communications
services), MedImmune, Inc. (biotechnology), Overstock.com (internet
services), White Mountains Insurance Group, Ltd. (holding company) and
Spacehab, Inc. (aerospace services); director or trustee, as the case may be,
of 48 of the investment companies in Franklin Templeton Investments; and
FORMERLY, Chairman, White River Corporation (financial services) (until 1998)
and Hambrecht & Quist Group (investment banking) (until 1992), and President,
National Association of Securities Dealers, Inc. (until 1987).
Harmon E. Burns (55)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT
Vice Chairman, Member - Office of the Chairman and Director, Franklin
Resources, Inc.; Executive Vice President and Director, Franklin Templeton
Distributors, Inc.; Executive Vice President, Franklin Advisers, Inc.;
Director, Franklin Investment Advisory Services, Inc., Franklin/Templeton
Investor Services, Inc. and Franklin Templeton Services, Inc.; and officer
and/or director or trustee, as the case may be, of most of the other
subsidiaries of Franklin Resources, Inc. and of 52 of the investment
companies in Franklin Templeton Investments.
Martin L. Flanagan (40)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
President, Member - Office of the President, Chief Financial Officer and
Chief Operating Officer, Franklin Resources, Inc.; Executive Vice President
and Director, Franklin/Templeton Investor Services, Inc.; President and Chief
Financial Officer, Franklin Mutual Advisers, LLC; Executive Vice President,
Chief Financial Officer and Director, Templeton Worldwide, Inc.; Executive
Vice President, Chief Operating Officer and Director, Templeton Investment
Counsel, Inc.; Executive Vice President, Franklin Advisers, Inc. and Franklin
Investment Advisory Services, Inc.; Chief Financial Officer, Franklin
Advisory Services, LLC; Chairman and Director, Franklin Templeton Services,
Inc.; officer and/or director of some of the other subsidiaries of Franklin
Resources, Inc.; and officer and/or director or trustee, as the case may be,
of 52 of the investment companies in Franklin Templeton Investments.
David P. Goss (53)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT
Associate General Counsel, Franklin Templeton Investments; President, Chief
Executive Officer and Director, Franklin Select Realty Trust, Property
Resources, Inc., Property Resources Equity Trust, Franklin Real Estate
Management, Inc. and Franklin Properties, Inc.; officer and director of some
of the other subsidiaries of Franklin Resources, Inc.; officer of 53 of the
investment companies in Franklin Templeton Investments; and FORMERLY,
President, Chief Executive Officer and Director, Franklin Real Estate Income
Fund and Franklin Advantage Real Estate Income Fund (until 1996).
Barbara J. Green (53)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT
Vice President and Deputy General Counsel, Franklin Resources, Inc.; Senior
Vice President, Templeton Worldwide, Inc.; officer of 53 of the investment
companies in Franklin Templeton Investments; and formerly, Deputy Director,
Division of Investment Management, Executive Assistant and Senior Advisor to
the Chairman, Counselor to the Chairman, Special Counsel and Attorney Fellow,
U.S. Securities and Exchange Commission (1986-1995), Attorney, Rogers & Wells
(until 1986), and Judicial Clerk, U.S. District Court (District of
Massachusetts) (until 1979).
Edward V. McVey (63)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT
Senior Vice President, Franklin Templeton Distributors, Inc.; officer of one
of the other subsidiaries of Franklin Resources, Inc. and of 30 of the
investment companies in Franklin Templeton Investments.
Kimberley Monasterio (36)
777 Mariners Island Blvd., San Mateo, CA 94404
TREASURER AND PRINCIPAL ACCOUNTING OFFICER
Senior Vice President, Franklin Templeton Services, Inc.; and officer of 34
of the investment companies in Franklin Templeton Investments.
Thomas J. Runkel (42)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT
Senior Vice President and Portfolio Manager, Franklin Advisers, Inc.; and
officer of four of the investment companies in Franklin Templeton Investments.
Murray L. Simpson (63)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT
Executive Vice President and General Counsel, Franklin Resources, Inc.;
officer and/or director of some of the subsidiaries of Franklin Resources,
Inc.; officer of 53 of the investment companies in Franklin Templeton
Investments; and FORMERLY, Chief Executive Officer and Managing Director,
Templeton Franklin Investment Services (Asia) Limited (until January 2000)
and Director, Templeton Asset Management Ltd. (until 1999).
R. Martin Wiskemann (73)
777 Mariners Island Blvd., San Mateo, CA 94404
VICE PRESIDENT
Executive Vice President, and Director, Franklin Advisers, Inc.; Senior Vice
President, Franklin Management, Inc.; and officer and/or director or trustee,
as the case may be, of 15 of the investment companies in Franklin Templeton
Investments; and FORMERLY, Vice President and Director, ILA Financial
Services, Inc. (until 1998).
*This board member is considered an "interested person" under federal
securities laws.
Note: Charles B. Johnson and Rupert H. Johnson, Jr. are brothers.
The Trust currently does not pay fees to noninterested board members. Board
members who serve on the audit committee of the Trust and other funds in
Franklin Templeton Investments receive a flat fee of $2,000 per committee
meeting attended, a portion of which is allocated to the Trust. Members of a
committee are not compensated for any committee meeting held on the day of a
board meeting. Noninterested board members also may serve as directors or
trustees of other funds in Franklin Templeton Investments and may receive
fees from these funds for their services. The fees payable to noninterested
board members by the Trust are subject to reductions resulting from fee caps
limiting the amount of fees payable to board members who serve on other
boards within Franklin Templeton Investments. The following table provides
the total fees paid to noninterested board members by Franklin Templeton
Investments.
NUMBER OF
BOARDS IN
TOTAL FEES FRANKLIN
RECEIVED FROM TEMPLETON
FRANKLIN INVESTMENTS
TEMPLETON ON WHICH
NAME INVESTMENTS 1 ($) EACH SERVES 2
----------------------------------------------------------------------
Frank H. Abbott, III 156,060 29
Harris J. Ashton 363,165 48
S. Joseph Fortunato 363,238 50
Frank W.T. LaHaye 156,060 29
Gordon S. Macklin 363,165 48
1. For the calendar year ended December 31, 1999.
2. We base the number of boards on the number of registered investment
companies in Franklin Templeton Investments. This number does not include the
total number of series or funds within each investment company for which the
board members are responsible. Franklin Templeton Investments currently
includes 52 registered investment companies, with approximately 156 U.S.
based funds or series.
Noninterested board members are reimbursed for expenses incurred in
connection with attending board meetings, paid pro rata by each fund in
Franklin Templeton Investments for which they serve as director or trustee.
No officer or board member received any other compensation, including pension
or retirement benefits, directly or indirectly from the Fund or other funds
in Franklin Templeton Investments. Certain officers or board members who are
shareholders of Franklin Resources, Inc. may be deemed to receive indirect
remuneration by virtue of their participation, if any, in the fees paid to
its subsidiaries.
Board members historically have followed a policy of having substantial
investments in one or more of the funds in Franklin Templeton Investments, as
is consistent with their individual financial goals. In February 1998, this
policy was formalized through adoption of a requirement that each board
member invest one-third of fees received for serving as a director or trustee
of a Templeton fund in shares of one or more Templeton funds and one-third of
fees received for serving as a director or trustee of a Franklin fund in
shares of one or more Franklin funds until the value of such investments
equals or exceeds five times the annual fees paid such board member.
Investments in the name of family members or entities controlled by a board
member constitute fund holdings of such board member for purposes of this
policy, and a three year phase-in period applies to such investment
requirements for newly elected board members. In implementing such policy, a
board member's fund holdings existing on February 27, 1998, are valued as of
such date with subsequent investments valued at cost.
The board, with approval of all noninterested and interested board members,
has adopted written procedures designed to deal with potential conflicts of
interest that may arise from the Fund and The Money Market Portfolio having
substantially the same boards. These procedures call for an annual review of
the Fund's relationship with the Portfolio. If a conflict exists, the boards
may take action, which may include the establishment of a new board. The
board has determined that there are no conflicts of interest at the present
time.
MANAGEMENT AND OTHER SERVICES
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MANAGER AND SERVICES PROVIDED The Money Market Portfolio's manager is
Franklin Advisers, Inc. The manager is a wholly owned subsidiary of Franklin
Resources, Inc. (Resources), a publicly owned company engaged in the
financial services industry through its subsidiaries. Charles B. Johnson and
Rupert H. Johnson, Jr. are the principal shareholders of Resources.
The manager provides investment research and portfolio management services,
and selects the securities for the Portfolio to buy, hold or sell. The
manager also selects the brokers who execute the Portfolio's portfolio
transactions. The manager provides periodic reports to the board, which
reviews and supervises the manager's investment activities. To protect the
Portfolio, the manager and its officers, directors and employees are covered
by fidelity insurance.
The manager and its affiliates manage numerous other investment companies and
accounts. The manager may give advice and take action with respect to any of
the other funds it manages, or for its own account, that may differ from
action taken by the manager on behalf of the Portfolio. Similarly, with
respect to the Portfolio, the manager is not obligated to recommend, buy or
sell, or to refrain from recommending, buying or selling any security that
the manager and access persons, as defined by applicable federal securities
laws, may buy or sell for its or their own account or for the accounts of any
other fund. The manager is not obligated to refrain from investing in
securities held by the Portfolio or other funds it manages.
The Fund, the Portfolio, its manager and the Fund's principal underwriter
have each adopted a code of ethics, as required by federal securities laws.
Under the code of ethics, employees who are designated as access persons may
engage in personal securities transactions, including transactions involving
securities that are being considered for the Portfolio or that are currently
held by the Portfolio, subject to certain general restrictions and
procedures. The personal securities transactions of access persons of the
Fund, the Portfolio, its manager and the Fund's principal underwriter will be
governed by the code of ethics. The code of ethics is on file with, and
available from, the U.S. Securities and Exchange Commission (SEC).
MANAGEMENT FEES The Portfolio pays the manager a fee equal to an annual rate
of 0.15 of 1% of the value of the Portfolio's average daily net assets.
The fee is computed at the close of business each day according to the terms
of the management agreement.
For the last three fiscal years ended June 30, the Portfolio paid the
following management fees:
MANAGEMENT FEES PAID 1 ($)
--------------------------------------------------
2000 5,179,045
1999 3,900,807
1998 2,830,858
1. For the fiscal years ended June 30, 2000, 1999 and 1998, management fees,
before any advance waiver, totaled $5,343,198, $3,996,761 and $2,963,304,
respectively. Under an agreement by the manager to limit its fees, the
Portfolio paid the management fees shown.
ADMINISTRATOR AND SERVICES PROVIDED Franklin Advisers, Inc. (Advisers) has
an agreement with the Fund to provide various administrative, statistical and
other services to the Fund.
ADMINISTRATION FEES The Fund pays Advisers a monthly fee equal to an annual
rate of:
o 91/200 of 1% for the first $100 million of the fund's average daily net
assets;
o 33/100 of 1% of average daily net assets over $100 million up to and
including $250 million; and
o 7/25 of 1% of average daily net assets in excess of $250 million.
During the last three fiscal years ended June 30, the Fund paid Advisers the
following administration fees:
ADMINISTRATION FEES PAID 1 ($)
-----------------------------------------------------
2000 189,753
1999 214,220
1998 64,151
1. For the fiscal years ended June 30, 2000, 1999 and 1998, administration
fees, before any advance waiver, totaled $476,619, $383,003 and $110,622,
respectively. Under an agreement by Advisers to limit its fees, the Fund
paid the administration fees shown.
Each class of the Fund's shares pays its proportionate share of the fee.
SHAREHOLDER SERVICING AND TRANSFER AGENT Franklin/Templeton Investor
Services, Inc. (Investor Services) is the Fund's shareholder servicing agent
and acts as the Fund's transfer agent and dividend-paying agent. Investor
Services is located at 777 Mariners Island Blvd., San Mateo, CA 94404. Please
send all correspondence to Investor Services to P.O. Box 33096,
St. Petersburg, FL 33733-8096.
For its services, Investor Services receives a fixed fee per account. The
Fund also will reimburse Investor Services for certain out-of-pocket
expenses, which may include payments by Investor Services to entities,
including affiliated entities, that provide sub-shareholder services,
recordkeeping and/or transfer agency services to beneficial owners of the
Fund. The amount of reimbursements for these services per benefit plan
participant Fund account per year will not exceed the per account fee payable
by the Fund to Investor Services in connection with maintaining shareholder
accounts.
CUSTODIAN Investor Services, as the transfer agent for The Money Market
Portfolio, effectively acts as the Fund's custodian and holds the Fund's
shares of the Portfolio on its books. Bank of New York, Mutual Funds
Division, 90 Washington Street, New York, NY 10286, acts as custodian of the
Fund's cash, pending investment in Portfolio shares. Bank of New York also
acts as custodian of the securities and other assets of the Portfolio.
AUDITOR PricewaterhouseCoopers LLP, 333 Market Street, San Francisco, CA
94105, is the Fund's independent auditor. The auditor gives an opinion on the
financial statements included in the Trust's Annual Report to Shareholders
and reviews the Trust's registration statement filed with SEC.
PORTFOLIO TRANSACTIONS
-------------------------------------------------------------------------------
The Fund will not incur any brokerage or other costs in connection with
buying or selling shares of the Portfolio.
Since most purchases by the Portfolio are principal transactions at net
prices, the Portfolio incurs little or no brokerage costs. The Portfolio
deals directly with the selling or buying principal or market maker without
incurring charges for the services of a broker on its behalf, unless it is
determined that a better price or execution may be obtained by using the
services of a broker. Purchases of portfolio securities from underwriters
will include a commission or concession paid by the issuer to the
underwriter, and purchases from dealers will include a spread between the bid
and ask prices. The Portfolio seeks to obtain prompt execution of orders at
the most favorable net price. Transactions may be directed to dealers in
return for research and statistical information, as well as for special
services provided by the dealers in the execution of orders.
It is not possible to place a dollar value on the special executions or on
the research services the manager receives from dealers effecting
transactions in portfolio securities. The allocation of transactions to
obtain additional research services allows the manager to supplement its own
research and analysis activities and to receive the views and information of
individuals and research staffs of other securities firms. As long as it is
lawful and appropriate to do so, the manager and its affiliates may use this
research and data in their investment advisory capacities with other clients.
If the Portfolio's officers are satisfied that the best execution is
obtained, the sale of Fund shares, as well as shares of other funds in
Franklin Templeton Investments, also may be considered a factor in the
selection of broker-dealers to execute the Portfolio's portfolio transactions.
If purchases or sales of securities of the Portfolio and one or more other
investment companies or clients supervised by the manager are considered at
or about the same time, transactions in these securities will be allocated
among the several investment companies and clients in a manner deemed
equitable to all by the manager, taking into account the respective sizes of
the funds and the amount of securities to be purchased or sold. In some cases
this procedure could have a detrimental effect on the price or volume of the
security so far as the Portfolio is concerned. In other cases it is possible
that the ability to participate in volume transactions may improve execution
and reduce transaction costs to the Portfolio.
During the fiscal years ended June 30, 2000, 1999 and 1998, the Portfolio did
not pay any brokerage commissions.
As of June 30, 2000, the Portfolio owned the following securities issued by
its regular broker-dealers:
AGGREGATE
VALUE OF
PORTFOLIO
TRANSACTIONS ($)
----------------------------------------------------------
Morgan Stanley Dean Witter 153,622,000
Morgan (J.P.) Securities Inc. 24,665,000
UBS Warburg 24,991,000
Merrill Lynch Government Securities Inc. 74,302,000
Barclays Investment Inc. 24,931,000
Banc of America Securities LLC 155,000,000
Salomon Smith Barney 164,514,000
Dresdner Kleinwort Benson, North America 75,001,000
LLC
Except as noted, neither the Fund nor the Portfolio owned any securities
issued by their regular broker-dealers as of the end of the fiscal year.
DISTRIBUTIONS AND TAXES
-------------------------------------------------------------------------------
The Fund calculates dividends the same way for each class. The Fund does not
pay "interest" or guarantee any fixed rate of return on an investment in its
shares.
DISTRIBUTIONS OF NET INVESTMENT INCOME The Fund typically pays dividends
from its daily net income each day that its net asset value is calculated.
The Fund's daily net income includes dividends it receives from its
investment in the Portfolio, less the estimated expenses of the Fund. Any
distributions by the Fund from such income will be taxable to you as ordinary
income, whether you receive them in cash or in additional shares.
The Portfolio's daily net income includes accrued interest and any original
issue or acquisition discount, plus or minus any gain or loss on the sale of
portfolio securities and changes in unrealized appreciation or depreciation
in portfolio securities (to the extent required to maintain a stable $1 share
price), less the estimated expenses of the Portfolio.
DISTRIBUTIONS OF CAPITAL GAINS The Fund may derive capital gains and losses
in connection with its investment in its shares of the Portfolio.
Distributions from net short-term capital gains will be taxable to you as
ordinary income. Because the Fund invests in a money fund, it does not
anticipate realizing any long-term capital gains.
MAINTAINING A $1 SHARE PRICE Gains and losses on the Fund's investment in
shares of the Portfolio and unrealized appreciation or depreciation in the
value of these shares may require the Fund to adjust distributions to
maintain its $1 share price. These procedures may result in under- or
over-distributions by the Fund of its net investment income.
EFFECT OF FOREIGN INVESTMENTS ON DISTRIBUTIONS Most foreign exchange gains
realized on the sale of debt securities are treated as ordinary income by the
Portfolio. Similarly, foreign exchange losses realized on the sale of debt
securities generally are treated as ordinary losses. These gains when
distributed will be taxable to the Fund as ordinary income, and any losses
will reduce the Portfolio's ordinary income otherwise available for
distribution to the Fund. This treatment could increase or decrease the
Portfolio's ordinary income distributions to the Fund and, in turn, to you.
The Portfolio may be subject to foreign withholding taxes on income from
certain foreign securities. This could reduce ordinary income distributions
to the Fund and, in turn, to you.
INFORMATION ON THE TAX CHARACTER OF DISTRIBUTIONS The Fund will inform you
of the amount of your distributions at the time they are paid, and will
advise you of their tax status for federal income tax purposes shortly after
the close of each calendar year.
If you have not held Fund shares for a full year, the Fund may designate and
distribute to you, as ordinary income, a percentage of income that is not
equal to the actual amount of such income earned during the period of your
investment in the Fund.
ELECTION TO BE TAXED AS A REGULATED INVESTMENT COMPANY The Fund has elected
to be treated as a regulated investment company under Subchapter M of the
Internal Revenue Code (Code). The Fund has qualified as a regulated
investment company for its most recent fiscal year, and intends to continue
to qualify during the current fiscal year. As a regulated investment company,
the Fund generally pays no federal income tax on the income and gains it
distributes to you. The board reserves the right not to maintain the
qualification of the Fund as a regulated investment company if it determines
such course of action to be beneficial to shareholders. In such case, the
Fund will be subject to federal, and possibly state, corporate taxes on its
taxable income and gains, and distributions to you will be taxed as ordinary
dividend income to the extent of the Fund's earnings and profits.
EXCISE TAX DISTRIBUTION REQUIREMENTS To avoid federal excise taxes, the Code
requires the Fund to distribute to you by December 31 of each year, at a
minimum, the following amounts: 98% of its taxable ordinary income earned
during the calendar year; 98% of its capital gain net income earned during
the twelve month period ending October 31; and 100% of any undistributed
amounts from the prior year. The Fund intends to declare and pay these
distributions in December (or to pay them in January, in which case you must
treat them as received in December) but can give no assurances that its
distributions will be sufficient to eliminate all taxes.
REDEMPTION OF FUND SHARES Redemptions (including redemptions in kind) and
exchanges of Fund shares are taxable transactions for federal and state
income tax purposes. Because the Fund tries to maintain a stable $1 share
price, however, you should not expect to realize any capital gain or loss on
the sale or exchange of your shares.
U.S. GOVERNMENT SECURITIES States grant tax-free status to dividends paid
from interest earned on certain U.S. government securities. The Fund
anticipates, however, that none of its distributions will qualify for this
exemption because it invests only indirectly (through the Portfolio) in any
qualifying U.S. government securities.
DIVIDENDS-RECEIVED DEDUCTION FOR CORPORATIONS Because the Portfolio's income
is derived primarily from interest rather than dividends, generally none of
the Fund's distributions will be eligible for the corporate
dividends-received deduction.
INVESTMENT IN COMPLEX SECURITIES The Portfolio may invest in complex
securities, including stripped securities. These investments may be subject
to numerous special and complex tax rules. These rules may affect the amount,
timing or character of the income distributed to the Fund by the Portfolio
and, in turn, by the Fund to you.
ORGANIZATION, VOTING RIGHTS AND PRINCIPAL HOLDERS
-------------------------------------------------------------------------------
The Fund is a series of Franklin Templeton Money Fund Trust (the Trust), an
open-end management investment company, commonly called a mutual fund. The
Trust was organized as a Delaware business trust on January 30, 1995, and is
registered with the SEC.
The Fund currently offers two classes of shares, Class B and Class C. The
Fund may offer additional classes of shares in the future. The full title of
each class is:
o Franklin Templeton Money Fund - Class B
o Franklin Templeton Money Fund - Class C
Shares of each class represent proportionate interests in the Fund's assets.
On matters that affect the Fund as a whole, each class has the same voting
and other rights and preferences as any other class. On matters that affect
only one class, only shareholders of that class may vote. Each class votes
separately on matters affecting only that class, or expressly required to be
voted on separately by state or federal law.
The Trust has noncumulative voting rights. For board member elections, this
gives holders of more than 50% of the shares voting the ability to elect all
of the members of the board. If this happens, holders of the remaining shares
voting will not be able to elect anyone to the board.
The Trust does not intend to hold annual shareholder meetings. The Trust or a
series of the Trust may hold special meetings, however, for matters requiring
shareholder approval. A meeting may be called by the board to consider the
removal of a board member if requested in writing by shareholders holding at
least 10% of the outstanding shares. In certain circumstances, we are
required to help you communicate with other shareholders about the removal of
a board member. A special meeting also may be called by the board in its
discretion.
As of October 2, 2000, the principal shareholders of the Fund, beneficial or
of record, were:
NAME AND ADDRESS SHARE CLASS PERCENTAGE (%)
----------------------------------------------------------------
NFSC FEBO
Raouf Awad
Fayza Awad
4019 W 139th St.
Hawthorne, CA 90250 Class B 6.99
Prudential Securities, Inc.
FBO Mr. Louis P. Ferris, Jr.
30955 Northwestern Highway
Farmington Hills, MI 48334 Class C 5.07
From time to time, the number of Fund shares held in the "street name"
accounts of various securities dealers for the benefit of their clients or in
centralized securities depositories may exceed 5% of the total shares
outstanding.
As of October 2, 2000, the officers and board members, as a group, owned of
record and beneficially less than 1% of the outstanding shares of each class.
The board members may own shares in other funds in Franklin Templeton
Investments.
BUYING AND SELLING SHARES
-------------------------------------------------------------------------------
The Fund continuously offers its shares through securities dealers who have
an agreement with Franklin Templeton Distributors, Inc. (Distributors). A
securities dealer includes any financial institution that, either directly or
through affiliates, has an agreement with Distributors to handle customer
orders and accounts with the Fund. This reference is for convenience only and
does not indicate a legal conclusion of capacity. Banks and financial
institutions that sell shares of the Fund may be required by state law to
register as securities dealers.
For investors outside the U.S., the offering of Fund shares may be limited in
many jurisdictions. An investor who wishes to buy shares of the Fund should
determine, or have a broker-dealer determine, the applicable laws and
regulations of the relevant jurisdiction. Investors are responsible for
compliance with tax, currency exchange or other regulations applicable to
redemption and purchase transactions in any jurisdiction to which they may be
subject. Investors should consult appropriate tax and legal advisors to
obtain information on the rules applicable to these transactions.
All checks, drafts, wires and other payment mediums used to buy or sell
shares of the Fund must be denominated in U.S. dollars and drawn on a U.S.
bank, and are accepted subject to collection at full face value. Checks drawn
in U.S. funds on foreign banks will not be credited to your account and
dividends will not begin to accrue until the proceeds are collected, which
may take a long period of time. We may, in our sole discretion, either (a)
reject any order to buy or sell shares denominated in any other currency or
(b) honor the transaction or make adjustments to your account for the
transaction as of a date and with a foreign currency exchange factor
determined by the drawee bank. We may deduct any applicable banking charges
imposed by the bank from your account.
The offering of Fund shares may be suspended at any time and resumed at any
time thereafter.
DEALER COMPENSATION Distributors and/or its affiliates may provide financial
support to securities dealers that sell shares of Franklin Templeton
Investments. This support is based primarily on the amount of sales of fund
shares and/or total assets with Franklin Templeton Investments. The amount of
support may be affected by: total sales; net sales; levels of redemptions;
the proportion of a securities dealer's sales and marketing efforts in
Franklin Templeton Investments; a securities dealer's support of, and
participation in, Distributors' marketing programs; a securities dealer's
compensation programs for its registered representatives; and the extent of a
securities dealer's marketing programs relating to Franklin Templeton
Investments. Financial support to securities dealers may be made by payments
from Distributors' resources, from Distributors' retention of underwriting
concessions and, in the case of funds that have Rule 12b-1 plans, from
payments to Distributors under such plans. In addition, certain securities
dealers may receive brokerage commissions generated by fund portfolio
transactions in accordance with the rules of the National Association of
Securities Dealers, Inc.
Distributors routinely sponsors due diligence meetings for registered
representatives during which they receive updates on various Franklin
Templeton funds and are afforded the opportunity to speak with portfolio
managers. Invitation to these meetings is not conditioned on selling a
specific number of shares. Those who have shown an interest in Franklin
Templeton funds, however, are more likely to be considered. To the extent
permitted by their firm's policies and procedures, registered
representatives' expenses in attending these meetings may be covered by
Distributors.
CONTINGENT DEFERRED SALES CHARGE (CDSC) For Class B shares, there is a CDSC
if you sell your shares within six years from the date of purchase of the
shares that were exchanged for shares of the Fund, as described in the table
below. The charge is based on the value of the shares sold or the net asset
value at the time of purchase, whichever is less.
IF YOU SELL YOUR CLASS B
SHARES WITHIN THIS MANY YEARS THIS % IS DEDUCTED
AFTER BUYING THEM FROM YOUR PROCEEDS AS A CDSC
------------------------------------------------------
1 Year 4
2 Years 4
3 Years 3
4 Years 3
5 Years 2
6 Years 1
7 Years 0
For Class C shares, a CDSC may apply if you sell your shares within 18 months
from the date of purchase of the shares that were exchanged for shares of the
Fund. The CDSC is 1% of the value of the shares sold or the net asset value
at the time of purchase, whichever is less.
CDSC WAIVERS. The CDSC for each class generally will be waived for:
o Account fees
o Redemptions by the Fund when an account falls below the minimum required
account size
o Redemptions following the death of the shareholder or beneficial owner
o Redemptions through a systematic withdrawal plan, up to 1% monthly, 3%
quarterly, 6% semiannually or 12% annually of your account's net asset
value depending on the frequency of your plan
o Redemptions by an employee benefit plan: (i) that is a customer of Franklin
Templeton Defined Contribution Services; and/or (ii) whose assets are held
by Franklin Templeton Bank & Trust as trustee or custodian (not applicable
to Class B)
o Distributions from individual retirement accounts (IRAs) due to death or
disability or upon periodic distributions based on life expectancy (for
Class B, this applies to all retirement plan accounts, not only IRAs)
o Returns of excess contributions (and earnings, if applicable) from
retirement plan accounts
o Participant initiated distributions from employee benefit plans or
participant initiated exchanges among investment choices in employee
benefit plans (not applicable to Class B)
EXCHANGE PRIVILEGE If a substantial number of shareholders should, within a
short period, sell their Fund shares under the exchange privilege, the Fund
might have to sell portfolio securities it might otherwise hold and incur the
additional costs related to such transactions.
The proceeds from the sale of shares of an investment company generally are
not available until the seventh day following the sale. The funds you are
seeking to exchange into may delay issuing shares pursuant to an exchange
until that seventh day. The sale of Fund shares to complete an exchange will
be effected at net asset value at the close of business on the day the
request for exchange is received in proper form.
SYSTEMATIC WITHDRAWAL PLAN Our systematic withdrawal plan allows you to sell
your shares and receive regular payments from your account on a monthly,
quarterly, semiannual or annual basis. The value of your account must be at
least $5,000 and the minimum payment amount for each withdrawal must be at
least $50. For retirement plans subject to mandatory distribution
requirements, the $50 minimum will not apply. There are no service charges
for establishing or maintaining a systematic withdrawal plan.
Each month in which a payment is scheduled, we will redeem an equivalent
amount of shares in your account on the day of the month you have indicated
on your account application or, if no day is indicated, on the 20th day of
the month. If that day falls on a weekend or holiday, we will process the
redemption on the next business day. For plans set up before June 1, 2000, we
will continue to process redemptions on the 25th day of the month (or the
next business day) unless you instruct us to change the processing date.
Available processing dates currently are the 1st, 5th, 10th, 15th, 20th and
25th days of the month. When you sell your shares under a systematic
withdrawal plan, it is a taxable transaction. Shares sold under the plan also
may be subject to a CDSC.
Redeeming shares through a systematic withdrawal plan may reduce or exhaust
the shares in your account if payments exceed distributions received from the
Fund. If a withdrawal amount exceeds the value of your account, your account
will be closed and the remaining balance in your account will be sent to you.
Because the amount withdrawn under the plan may be more than your actual
yield or income, part of the payment may be a return of your investment.
To discontinue a systematic withdrawal plan, change the amount and schedule
of withdrawal payments, or suspend one payment, we must receive instructions
from you at least three business days before a scheduled payment. The Fund
may discontinue a systematic withdrawal plan by notifying you in writing and
will discontinue a systematic withdrawal plan automatically if all shares in
your account are withdrawn or if the Fund receives notification of the
shareholder's death or incapacity.
REDEMPTIONS IN KIND The Fund has committed itself to pay in cash (by check)
all requests for redemption by any shareholder of record, limited in amount,
however, during any 90-day period to the lesser of $250,000 or 1% of the
value of the Fund's net assets at the beginning of the 90-day period. This
commitment is irrevocable without the prior approval of the U.S. Securities
and Exchange Commission (SEC). In the case of redemption requests in excess
of these amounts, the board reserves the right to make payments in whole or
in part in securities or other assets of the Fund, in case of an emergency,
or if the payment of such a redemption in cash would be detrimental to the
existing shareholders of the Fund. In these circumstances, the securities
distributed would be valued at the price used to compute the Fund's net
assets and you may incur brokerage fees in converting the securities to cash.
SHARE CERTIFICATES We will credit your shares to your Fund account. We do
not issue share certificates. This eliminates the costly problem of replacing
lost, stolen or destroyed certificates.
All purchases of Fund shares will be credited to you, in full and fractional
Fund shares (rounded to the nearest 1/100 of a share), in an account
maintained for you by the Fund's transfer agent. No share certificates will
be issued.
GENERAL INFORMATION If dividend checks are returned to the Fund marked
"unable to forward" by the postal service, we will consider this a request by
you to change your dividend option to reinvest all distributions. The
proceeds will be reinvested in additional shares at net asset value until we
receive new instructions.
Distribution or redemption checks sent to you do not earn interest or any
other income during the time the checks remain uncashed. Neither the Fund nor
its affiliates will be liable for any loss caused by your failure to cash
such checks. The Fund is not responsible for tracking down uncashed checks,
unless a check is returned as undeliverable.
In most cases, if mail is returned as undeliverable we are required to take
certain steps to try to find you free of charge. If these attempts are
unsuccessful, however, we may deduct the costs of any additional efforts to
find you from your account. These costs may include a percentage of the
account when a search company charges a percentage fee in exchange for its
location services.
Sending redemption proceeds by wire or electronic funds transfer (ACH) is a
special service that we make available whenever possible. By offering this
service to you, the Fund is not bound to meet any redemption request in less
than the seven day period prescribed by law. Neither the Fund nor its agents
shall be liable to you or any other person if, for any reason, a redemption
request by wire or ACH is not processed as described in the prospectus.
Franklin Templeton Investor Services, Inc. (Investor Services) may pay
certain financial institutions that maintain omnibus accounts with the Fund
on behalf of numerous beneficial owners for recordkeeping operations
performed with respect to such owners. For each beneficial owner in the
omnibus account, the Fund may reimburse Investor Services an amount not to
exceed the per account fee that the Fund normally pays Investor Services.
These financial institutions also may charge a fee for their services
directly to their clients.
Investor Services may charge you separate fees, negotiated directly with you,
for providing special services in connection with your account. Fees for
special services will not increase the Fund's expenses.
There are special procedures for banks and other institutions that wish to
open multiple accounts. An institution may open a single master account by
filing one application form with the Fund, signed by personnel authorized to
act for the institution. Individual sub-accounts may be opened when the
master account is opened by listing them on the application, or by providing
instructions to the Fund at a later date. These sub-accounts may be
registered either by name or number. The Fund's investment minimums apply to
each sub-account. The Fund will send confirmation and account statements for
the sub-accounts to the institution.
If you buy or sell shares through your securities dealer, we use the net
asset value next calculated after your securities dealer receives your
request, which is promptly transmitted to the Fund.
For institutional accounts, there may be additional methods of buying or
selling Fund shares than those described in this SAI or in the prospectus.
In the event of disputes involving multiple claims of ownership or authority
to control your account, the Fund has the right (but has no obligation) to:
(a) freeze the account and require the written agreement of all persons
deemed by the Fund to have a potential property interest in the account,
before executing instructions regarding the account; (b) interplead disputed
funds or accounts with a court of competent jurisdiction; or (c) surrender
ownership of all or a portion of the account to the IRS in response to a
notice of levy.
PRICING SHARES
-------------------------------------------------------------------------------
When you buy shares, you pay the net asset value (NAV) per share. When you
sell shares, you receive the NAV minus any applicable contingent deferred
sales charge (CDSC).
The value of a mutual fund is determined by deducting the fund's liabilities
from the total assets of the portfolio. The net asset value per share is
determined by dividing the net asset value of the fund by the number of
shares outstanding.
The Fund calculates the NAV per share of each class each business day at 3:00
p.m. Pacific time. The Fund does not calculate the NAV on days the New York
Stock Exchange (NYSE) is closed for trading, which include New Year's Day,
Martin Luther King Jr. Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day and Christmas Day.
The valuation of The Money Market Portfolio's portfolio securities, including
any securities set aside on the Portfolio's books for when-issued securities,
is based on the amortized cost of the securities, which does not take into
account unrealized capital gains or losses. This method involves valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium, regardless of the impact of fluctuating
interest rates on the market value of the instrument. While this method
provides certainty in calculation, it may result in periods during which
value, as determined by amortized cost, is higher or lower than the price the
Portfolio would receive if it sold the instrument. During periods of
declining interest rates, the daily yield on shares of the Portfolio computed
as described above may tend to be higher than a like computation made by a
fund with identical investments but using a method of valuation based upon
market prices and estimates of market prices for all of its portfolio
instruments. Thus, if the use of amortized cost by the Portfolio resulted in
a lower aggregate portfolio value on a particular day, a prospective investor
in the Portfolio would be able to obtain a somewhat higher yield than would
result from an investment in a fund using only market values, and existing
investors in the Portfolio would receive less investment income. The opposite
would be true in a period of rising interest rates. The Portfolio's use of
amortized cost, which helps the Portfolio maintain a $1 share price, is
permitted by a rule adopted by the SEC.
The board has established procedures designed to stabilize, to the extent
reasonably possible, the Portfolio's price per share at $1, as computed for
the purpose of sales and redemptions. These procedures include a review of
the Portfolio's holdings by the board, at such intervals as it may deem
appropriate, to determine if the Portfolio's net asset value calculated by
using available market quotations deviates from $1 per share based on
amortized cost. The extent of any deviation will be examined by the board. If
a deviation exceeds 1/2 of 1%, the board will promptly consider what action,
if any, will be initiated. If the board determines that a deviation exists
that may result in material dilution or other unfair results to investors or
existing shareholders, it will take corrective action that it regards as
necessary and appropriate, which may include selling portfolio instruments
before maturity to realize capital gains or losses or to shorten average
portfolio maturity, withholding dividends, redeeming shares in kind, or
establishing a net asset value per share by using available market
quotations.
THE UNDERWRITER
-------------------------------------------------------------------------------
Franklin Templeton Distributors, Inc. (Distributors) acts as the principal
underwriter in the continuous public offering of the Fund's shares.
Distributors is located at 777 Mariners Island Blvd., San Mateo, CA 94404.
Distributors pays the expenses of the distribution of Fund shares, including
advertising expenses and the costs of printing sales material and
prospectuses used to offer shares to the public. The Fund pays the expenses
of preparing and printing amendments to its registration statements and
prospectuses (other than those necessitated by the activities of
Distributors) and of sending prospectuses to existing shareholders.
The table below shows the amounts Distributors received in connection with
redemptions or repurchases of shares for the last three fiscal years ended
June 30:
AMOUNT RECEIVED IN
CONNECTION WITH REDEMPTIONS
AND REPURCHASES ($)
-----------------------------------------------
2000 246,771
1999 293,731
1998 64,948
Distributors may be entitled to payments from the Fund under the Rule 12b-1
plans, as discussed below. Except as noted, Distributors received no other
compensation from the Fund for acting as underwriter.
DISTRIBUTION AND SERVICE (12B-1) FEES The board has adopted a separate plan
pursuant to Rule 12b-1 for each class. Although the plans differ in some ways
for each class, each plan is designed to benefit the Fund and its
shareholders. The plans are expected to, among other things, increase
advertising of the Fund, encourage sales of the Fund and service to its
shareholders, and increase or maintain assets of the Fund so that certain
fixed expenses may be spread over a broader asset base, resulting in lower
per share expense ratios. In addition, a positive cash flow into the Fund is
useful in managing the Fund because the manager has more flexibility in
taking advantage of new investment opportunities and handling shareholder
redemptions.
Under each plan, the Fund pays Distributors or others for the expenses of
activities that are primarily intended to sell shares of the class. These
expenses also may include service fees paid to securities dealers or others
who have executed a servicing agreement with the Fund, Distributors or its
affiliates and who provide service or account maintenance to shareholders
(service fees); the expenses of printing prospectuses and reports used for
sales purposes, and of preparing and distributing sales literature and
advertisements; and a prorated portion of Distributors' overhead expenses
related to these activities. Together, these expenses, including the service
fees, are "eligible expenses." The 12b-1 fees charged to each class are based
only on the fees attributable to that particular class.
The Fund pays Distributors up to 0.65% per year of the class's average daily
net assets, out of which 0.15% may be used for service fees. The plans also
may be used to pay Distributors for advancing commissions to securities
dealers with respect to the initial sale of Class B and C shares. Class B
plan fees payable to Distributors are used by Distributors to pay third party
financing entities that have provided financing to Distributors in connection
with advancing commissions to securities dealers. Franklin Resources owns a
minority interest in one of the third party financing entities.
The plans are compensation plans. They allow the Fund to pay a fee to
Distributors that may be more than the eligible expenses Distributors has
incurred at the time of the payment. Distributors must, however, demonstrate
to the board that it has spent or has near-term plans to spend the amount
received on eligible expenses. The Fund will not pay more than the maximum
amount allowed under the plans.
Under the Class B plan, the amounts paid by the Fund pursuant to the plan for
the fiscal year ended June 30, 2000, were:
($)
----------------------------------------------
Advertising 273
Printing and mailing
prospectuses 256
other than to current
shareholders
Payments to underwriters 0
Payments to broker-dealers 20,427
Other 56
------------
Total 21,012
------------
Under the Class C plan, the amounts paid by the Fund pursuant to the plan for
the fiscal year ended June 30, 2000, were:
($)
----------------------------------------------
Advertising 5,476
Printing and mailing
prospectuses 6,078
other than to current
shareholders
Payments to underwriters --
Payments to broker-dealers 539,789
Other 2,515
------------
Total 553,858
------------
In addition to the payments that Distributors or others are entitled to under
each plan, each plan also provides that to the extent the Fund, the manager
or Distributors or other parties on behalf of the Fund, the manager or
Distributors make payments that are deemed to be for the financing of any
activity primarily intended to result in the sale of Fund shares within the
context of Rule 12b-1 under the Investment Company Act of 1940, as amended,
then such payments shall be deemed to have been made pursuant to the plan.
To the extent fees are for distribution or marketing functions, as
distinguished from administrative servicing or agency transactions, certain
banks may not participate in the plans because of applicable federal law
prohibiting certain banks from engaging in the distribution of mutual fund
shares. These banks, however, are allowed to receive fees under the plans for
administrative servicing or for agency transactions.
Distributors must provide written reports to the board at least quarterly on
the amounts and purpose of any payment made under the plans and any related
agreements, and furnish the board with such other information as the board
may reasonably request to enable it to make an informed determination of
whether the plans should be continued.
Each plan has been approved according to the provisions of Rule 12b-1. The
terms and provisions of each plan also are consistent with Rule 12b-1.
PERFORMANCE
-------------------------------------------------------------------------------
Performance quotations are subject to SEC rules. These rules require the use
of standardized performance quotations or, alternatively, that every
non-standardized performance quotation furnished by the Fund be accompanied
by certain standardized performance information computed as required by the
SEC. Average annual total return, current yield and effective yield
quotations used by the Fund are based on the standardized methods of
computing performance mandated by the SEC. Performance figures reflect Rule
12b-1 fees from the date of the plan's implementation. An explanation of
these and other methods used by the Fund to compute or express performance
follows. Regardless of the method used, past performance does not guarantee
future results, and is an indication of the return to shareholders only for
the limited historical period used.
AVERAGE ANNUAL TOTAL RETURN Average annual total return is determined by
finding the average annual rates of return over the periods indicated below
that would equate an initial hypothetical $1,000 investment to its ending
redeemable value. The calculation assumes income dividends are reinvested at
net asset value. The quotation assumes the account was completely redeemed at
the end of each period and the deduction of all applicable charges and fees.
The average annual total returns for the indicated periods ended June 30,
2000, were:
1 YEAR (%) SINCE INCEPTION (%) INCEPTION DATE
-------------------------------------------------------------
Class B 4.64 4.37 1/1/99
Class C 3.76 4.31 5/1/95
The following SEC formula was used to calculate these figures:
n
P(1+T) = ERV
where:
P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000
payment made at the beginning of each period at the end of each period
CURRENT YIELD Current yield shows the income per share earned by the Fund.
It is calculated by determining the net change, excluding capital changes, in
the value of a hypothetical pre-existing account with a balance of one share
at the beginning of the period, subtracting a hypothetical charge reflecting
deductions from shareholder accounts, and dividing the difference by the
value of the account at the beginning of the base period to obtain the base
period return. The result is then annualized by multiplying the base period
return by 365/7. The current yield for the seven day period ended June 30,
2000, was 5.37% for Class B and 5.48% for Class C.
EFFECTIVE YIELD The Fund's effective yield is calculated in the same manner
as its current yield, except the annualization of the return for the seven
day period reflects the results of compounding. The effective yield for the
seven day period ended June 30, 2000, was 5.51% for Class B and 5.63% for
Class C.
The following SEC formula was used to calculate this figure:
365/7
Effective yield = [(Base period return + 1) ] - 1
OTHER PERFORMANCE QUOTATIONS The Fund may include in its advertising or
sales material information relating to investment goals and performance
results of funds belonging to Franklin Templeton Investments. Franklin
Resources, Inc. is the parent company of the advisors and underwriter of
Franklin Templeton funds.
COMPARISONS To help you better evaluate how an investment in the Fund may
satisfy your investment goal, advertisements and other materials about the
Fund may discuss certain measures of Fund performance as reported by various
financial publications. Materials also may compare performance (as calculated
above) to performance as reported by other investments, indices, and
averages. These comparisons may include, but are not limited to, the
following examples:
o Lipper - Mutual Fund Performance Analysis, Lipper - Fixed Income Fund
Performance Analysis, and Lipper - Mutual Fund Yield Survey - measure
total return and average current yield for the mutual fund industry and
rank individual mutual fund performance over specified time periods,
assuming reinvestment of all distributions, exclusive of any applicable
sales charges.
o IBC Money Fund Report(R) - industry averages for seven day annualized
and compounded yields of taxable, tax-free and government money funds.
o BANK RATE MONITOR - a weekly publication that reports various bank
investments such as CD rates, average savings account rates and average
loan rates.
o SALOMON SMITH BARNEY BOND MARKET ROUNDUP - a weekly publication that
reviews yield spread changes in the major sectors of the money,
government agency, futures, options, mortgage, corporate, Yankee,
Eurodollar, municipal, and preferred stock markets and summarizes
changes in banking statistics and reserve aggregates.
From time to time, advertisements or information for the Fund may include a
discussion of certain attributes or benefits to be derived from an investment
in the Fund. The advertisements or information may include symbols,
headlines, or other material that highlights or summarizes the information
discussed in more detail in the communication.
Advertisements or information also may compare the Fund's performance to the
return on certificates of deposit (CDs) or other investments. You should be
aware, however, that an investment in the Fund involves the risk of
fluctuation of principal value, a risk generally not present in an investment
in a CD issued by a bank. CDs are frequently insured by an agency of the U.S.
government. An investment in the Fund is not insured by any federal, state or
private entity.
In assessing comparisons of performance, you should keep in mind that the
composition of the investments in the reported indices and averages is not
identical to the Fund's portfolio, the indices and averages are generally
unmanaged, and the items included in the calculations of the averages may not
be identical to the formula used by the Fund to calculate its figures. In
addition, there can be no assurance that the Fund will continue its
performance as compared to these other averages.
MISCELLANEOUS INFORMATION
-------------------------------------------------------------------------------
The Fund may help you achieve various investment goals such as accumulating
money for retirement, saving for a down payment on a home, college costs and
other long-term goals. The Franklin College Costs Planner may help you in
determining how much money must be invested on a monthly basis to have a
projected amount available in the future to fund a child's college education.
(Projected college cost estimates are based upon current costs published by
the College Board.) The Franklin Retirement Planning Guide leads you through
the steps to start a retirement savings program. Of course, an investment in
the Fund cannot guarantee that these goals will be met.
The Fund is a member of Franklin Templeton Investments, one of the largest
mutual fund organizations in the U.S., and may be considered in a program for
diversification of assets. Founded in 1947, Franklin is one of the oldest
mutual fund organizations and now services approximately 3 million
shareholder accounts. In 1992, Franklin, a leader in managing fixed-income
mutual funds and an innovator in creating domestic equity funds, joined
forces with Templeton, a pioneer in international investing. The Mutual
Series team, known for its value-driven approach to domestic equity
investing, became part of the organization four years later. Together,
Franklin Templeton Investments has over $236 billion in assets under
management for more than 5 million U.S. based mutual fund shareholder and
other accounts. Franklin Templeton Investments offers 107 U.S. based open-end
investment companies to the public. The Fund may identify itself by its
Nasdaq symbol or CUSIP number.
Currently, there are more mutual funds than there are stocks listed on the
New York Stock Exchange. While many of them have similar investment goals, no
two are exactly alike. Shares of the Fund are generally sold through
securities dealers, whose investment representatives are experienced
professionals who can offer advice on the type of investments suitable to
your unique goals and needs, as well as the risks associated with such
investments.
DESCRIPTION OF RATINGS
-------------------------------------------------------------------------------
CORPORATE BOND RATINGS
MOODY'S INVESTORS SERVICE, INC. (MOODY'S)
INVESTMENT GRADE
Aaa: Bonds rated Aaa are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as
"gilt-edged." Interest payments are protected by a large or exceptionally
stable margin, and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues.
Aa: Bonds rated Aa are judged to be high quality by all standards. Together
with the Aaa group, they comprise what are generally known as high-grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large, fluctuation of protective elements may be of greater
amplitude, or there may be other elements present that make the long-term
risks appear somewhat larger.
A: Bonds rated A possess many favorable investment attributes and are
considered upper medium-grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
that suggest a susceptibility to impairment sometime in the future.
Baa: Bonds rated Baa are considered medium-grade obligations. They are
neither highly protected nor poorly secured. Interest payments and principal
security appear adequate for the present but certain protective elements may
be lacking or may be characteristically unreliable over any great length of
time. These bonds lack outstanding investment characteristics and, in fact,
have speculative characteristics as well.
Note: Moody's applies numerical modifiers 1, 2 and 3 in each generic rating
classification from Aa through B in its corporate bond ratings. The modifier
1 indicates that the security ranks in the higher end of its generic rating
category; modifier 2 indicates a mid-range ranking; and modifier 3 indicates
that the issue ranks in the lower end of its generic rating category.
STANDARD & POOR'S RATINGS GROUP (S&P(R))
INVESTMENT GRADE
AAA: This is the highest rating assigned by S&P to a debt obligation and
indicates an extremely strong capacity to pay principal and interest.
AA: Bonds rated AA also qualify as high-quality debt obligations. Capacity to
pay principal and interest is very strong and, in the majority of instances,
differ from AAA issues only in a small degree.
A: Bonds rated A have a strong capacity to pay principal and interest,
although they are somewhat more susceptible to the adverse effects of changes
in circumstances and economic conditions.
BBB: Bonds rated BBB are regarded as having an adequate capacity to pay
principal and interest. Whereas they normally exhibit protection parameters,
adverse economic conditions or changing circumstances are more likely to lead
to a weakened capacity to pay principal and interest for bonds in this
category than for bonds in the A category.
Plus (+) or minus (-): The ratings from "AA" to "CCC" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.
MUNICIPAL BOND RATINGS
MOODY'S
INVESTMENT GRADE
Aaa: Municipal bonds rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt-edged." Interest payments are protected by a large or exceptionally
stable margin, and principal is secure. While the various protective elements
are likely to change, such changes as can be visualized are most unlikely to
impair the fundamentally strong position of such issues.
Aa: Municipal bonds rated Aa are judged to be high quality by all standards.
Together with the Aaa group, they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large, fluctuation of protective elements may be of
greater amplitude, or there may be other elements present that make the
long-term risks appear somewhat larger.
A: Municipal bonds rated A possess many favorable investment attributes and
are considered upper medium-grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
that suggest a susceptibility to impairment sometime in the future.
Baa: Municipal bonds rated Baa are considered medium-grade obligations. They
are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any
great length of time. These bonds lack outstanding investment characteristics
and, in fact, have speculative characteristics as well.
Note: Moody's applies numerical modifiers 1, 2 and 3 in each generic rating
classification from Aa through Caa in its municipal bond ratings. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; modifier 2 indicates a mid-range ranking; and modifier 3
indicates that the issue ranks in the lower end of its generic rating
category.
S&P
INVESTMENT GRADE
AAA: Municipal bonds rated AAA are the highest-grade obligations. They
possess the ultimate degree of protection as to principal and interest. In
the market, they move with interest rates and, hence, provide the maximum
safety on all counts.
AA: Municipal bonds rated AA also qualify as high-grade obligations, and in
the majority of instances differ from AAA issues only in a small degree.
Here, too, prices move with the long-term money market.
A: Municipal bonds rated A are regarded as upper medium-grade. They have
considerable investment strength but are not entirely free from adverse
effects of changes in economic and trade conditions. Interest and principal
are regarded as safe. They predominantly reflect money rates in their market
behavior but also, to some extent, economic conditions.
BBB: Municipal bonds rated BBB are regarded as having an adequate capacity to
pay principal and interest. Whereas they normally exhibit adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay principal and interest for bonds
in this category than for bonds in the A category.
Plus (+) or minus (-): The ratings from "AA" to "CCC" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.
FITCH INVESTORS SERVICE, INC. (FITCH)
INVESTMENT GRADE
AAA: Municipal bonds rated AAA are considered to be investment grade and of
the highest credit quality. The obligor has an exceptionally strong ability
to pay interest and repay principal that is unlikely to be affected by
reasonably foreseeable events.
AA: Municipal bonds rated AA are considered to be investment grade and of
very high credit quality. The obligor's ability to pay interest and repay
principal is very strong although not quite as strong as bonds rated AAA and
not significantly vulnerable to foreseeable future developments.
A: Municipal bonds rated A are considered to be investment grade and of high
credit quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.
BBB: Municipal bonds rated BBB are considered to be investment grade and of
satisfactory credit quality. The obligor's ability to pay interest and repay
principal is considered adequate. Adverse changes in economic conditions and
circumstances, however, are more likely to have an adverse impact on these
bonds, and therefore impair timely payment. The likelihood that the ratings
of these bonds will fall below investment grade is higher than for bonds with
higher ratings.
Plus (+) or minus (-) signs are used with a rating symbol to indicate the
relative position of a credit within the rating category. Plus or minus signs
are not used with the AAA, DDD, DD or D categories.
MUNICIPAL NOTE RATINGS
MOODY'S
Moody's ratings for state, municipal and other short-term obligations will be
designated Moody's Investment Grade (MIG). This distinction is in recognition
of the differences between short-term credit risk and long-term risk. Factors
affecting the liquidity of the borrower are uppermost in importance in
short-term borrowing; factors of the first importance in long-term borrowing
risk are of lesser importance in the short run. Symbols used will be as
follows:
MIG 1: Notes are of the best quality enjoying strong protection from
established cash flows of funds for their servicing or from established and
broad-based access to the market for refinancing, or both.
MIG 2: Notes are of high quality, with margins of protection ample, although
not so large as in the preceding group.
MIG 3: Notes are of favorable quality, with all security elements accounted
for, but lacking the undeniable strength of the preceding grades. Market
access for refinancing, in particular, is likely to be less well established.
MIG 4: Notes are of adequate quality, carrying specific risk but having
protection and not distinctly or predominantly speculative.
S&P
Until June 29, 1984, S&P used the same rating symbols for notes and bonds.
After June 29, 1984, for new municipal note issues due in three years or
less, the ratings below will usually be assigned. Notes maturing beyond three
years will most likely receive a bond rating of the type recited above.
SP-1: Issues carrying this designation have a very strong or strong capacity
to pay principal and interest. Issues determined to possess overwhelming
safety characteristics will be given a "plus" (+) designation.
SP-2: Issues carrying this designation have a satisfactory capacity to pay
principal and interest.
SHORT-TERM DEBT & COMMERCIAL PAPER RATINGS
MOODY'S
Moody's short-term debt ratings are opinions of the ability of issuers to
repay punctually senior debt obligations. These obligations have an original
maturity not exceeding one year, unless explicitly noted. Moody's commercial
paper ratings, which are also applicable to municipal paper investments, are
opinions of the ability of issuers to repay punctually their promissory
obligations not having an original maturity in excess of nine months. Moody's
employs the following designations for both short-term debt and commercial
paper, all judged to be investment grade, to indicate the relative repayment
capacity of rated issuers:
P-1 (Prime-1): Superior capacity for repayment.
P-2 (Prime-2): Strong capacity for repayment.
S&P
S&P's ratings are a current assessment of the likelihood of timely payment of
debt having an original maturity of no more than 365 days. Ratings are graded
into four categories, ranging from "A" for the highest quality obligations to
"D" for the lowest. Issues within the "A" category are delineated with the
numbers 1, 2 and 3 to indicate the relative degree of safety, as follows:
A-1: This designation indicates the degree of safety regarding timely payment
is very strong. A "plus" (+) designation indicates an even stronger
likelihood of timely payment.
A-2: Capacity for timely payment on issues with this designation is strong.
The relative degree of safety, however, is not as overwhelming as for issues
designated A-1.
A-3: Issues carrying this designation have a satisfactory capacity for timely
payment. They are, however, somewhat more vulnerable to the adverse effects
of changes in circumstances than obligations carrying the higher designations.
FITCH
Fitch's short-term ratings apply to debt obligations that are payable on
demand or have original maturities of generally up to three years, including
commercial paper, certificates of deposit, medium-term notes, and municipal
and investment notes. The short-term rating places greater emphasis than a
long-term rating on the existence of liquidity necessary to meet the issuer's
obligations in a timely manner.
F-1+: Exceptionally strong credit quality. Regarded as having the strongest
degree of assurance for timely payment.
F-1: Very strong credit quality. Reflect an assurance of timely payment only
slightly less in degree than issues rated F-1+.
F-2: Good credit quality. A satisfactory degree of assurance for timely
payment, but the margin of safety is not as great as for issues assigned F-1+
and F-1 ratings.
LOC: The symbol LOC indicates that the rating is based on a letter of credit
issued by a commercial bank.
FRANKLIN TEMPLETON MONEY FUND TRUST
File Nos. 33-88924
811-8962
FORM N-1A
PART C
OTHER INFORMATION
Item 23. Exhibits.
The following exhibits are incorporated by reference to the previous filed
document indicated below, except as noted:
(a) Agreement and Declaration of Trust
(i) Certificate of Trust of Franklin Templeton Money Fund Trust
dated January 17, 1995
Filing: Post-Effective Amendment No. 1 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: August 31, 1995
(ii) Agreement and Declaration of Trust of Franklin Templeton Money
Fund Trust dated January 17, 1995
Filing: Post-Effective Amendment No. 1 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: August 31, 1995
(b) By-Laws
(i) By-Laws of Franklin Templeton Money Fund Trust
Filing: Post-Effective Amendment No. 1 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: August 31, 1995
(c) Instruments Defining Rights of Security Holders
Not Applicable
(d) Investment Advisory Contracts
(i) Administration Agreement between the Registrant and Franklin
Advisers, Inc., on behalf of Franklin Templeton Money Fund II,
dated May 1, 1995
Filing: Post-Effective Amendment No. 1 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: August 31, 1995
(ii) Amendment dated August 1, 1995 to Administration Agreement
between the Registrant and Franklin Advisers, Inc., on behalf
of Franklin Templeton Money Fund II, dated May 1, 1995
Filing: Post-Effective Amendment No. 2 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: October 30, 1996
(e) Underwriting Contracts
(i) Underwriting Agreement between the Registrant and
Franklin/Templeton Distributors, Inc., dated May 1, 1995
Filing: Post-Effective Amendment No. 1 to Registration
Statement on Form N-1A
File No. 33-88924
Filing Date: August 31, 1995
(ii) Amendment to Underwriting Agreement dated January 12, 1999
Filing: Post-Effective Amendment No. 7 to Registration
Statement on Form N-1A
File No. 33-88924
Filing Date: August 27, 1999
(ii) Forms of Dealer Agreements between Franklin/Templeton
Distributors, Inc. and Securities Dealers
Filing: Post-Effective Amendment No. 5 to Registration
Statement on Form N-1A
File No. 33-88924
Filing Date: December 23, 1998
(f) Bonus or Profit Sharing Contracts
Not Applicable
(g) Custodian Agreements
(i) Master Custody Agreement between the Registrant and Bank of
New York dated February 16, 1996
Filing: Post-Effective Amendment No. 2 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: October 30, 1996
(ii) Amendment dated May 7, 1997 to the Master Custody Agreement
dated February 16, 1996 between Registrant and Bank of New York
Filing: Post-Effective Amendment No. 3 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: October 29, 1997
(iii) Amendment dated February 27, 1998 to the Master Custody
Agreement dated February 16, 1996 between Registrant and Bank of
New York
Filing: Post-Effective Amendment No. 4 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: August 21, 1998
(iv) Amendment dated August 30, 2000 to Exhibit A of the Master
Custody Agreement between Registrant and Bank of New York
dated February 16, 1996
(v) Terminal Link Agreement between the Registrant and Bank of New
York dated February 16, 1996
Filing: Post-Effective Amendment No. 2 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: October 30, 1996
(h) Other Material Contracts
Not Applicable
(i) Legal Opinion
(i) Opinion and consent of counsel
Filing: Post-Effective Amendment No. 5 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: December 23, 1998
(j) Other Opinions
(i) Consent of Independent Auditors
(k) Omitted Financial Statements
Not Applicable
(l) Initial Capital Agreements
(i) Letter of Understanding dated April 13, 1995
Filing: Post-Effective Amendment No. 1 to
Registration Statement on Form N-1A
File No. 33-88924
Filing Date: August 31, 1995
(m) Rule 12b-1 Plan
(i) Distribution Plan between the Registrant and
Franklin/Templeton Distributors, Inc., dated May 1, 1995
Filing: Post-Effective Amendment No. 1 to Registration
Statement on Form N-1A
File No. 33-88924
Filing Date: August 31, 1995
(ii) Class B Distribution Plan between Registrant and
Franklin/Templeton Distributors, Inc. dated November 17, 1998
(n) Rule 18f-3 Plan
Not Applicable
(p) Code of Ethics
(q) Power of Attorney
(i) Power of Attorney for Franklin Templeton Money Fund Trust
dated July 13, 2000
(ii) Power of Attorney for The Money Market Portfolios dated July
13, 2000
ITEM 24 PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
------- -----------------------------------------------------------
None
ITEM 25 INDEMNIFICATION
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to trustees, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a trustee, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person in
connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a Court of appropriate jurisdiction the question whether
such indemnification is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
Please see the Declaration of Trust, By-Laws, Administration Agreement, and
Distribution Agreements, previously filed as exhibits and incorporated herein
by reference.
ITEM 26 BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER
The officers and directors of the Registrant's manager also serve as officers
and/or trustees for (1) Franklin Advisers, Inc.'s (Advisers) corporate
parent, Franklin Resources, Inc., and/or (2) other investment companies in
Franklin Templeton Investments. In addition, Mr. Charles B. Johnson was
formerly a director of General Host Corporation. For additional information
please see Part B and Schedules A and D of Form ADV of Advisers (SEC File
801-26292), incorporated herein by reference, which sets forth the officers
and directors of Advisers and information as to any business, profession,
vocation or employment of a substantial nature engaged in by those officers
and directors during the past two years.
ITEM 27 PRINCIPAL UNDERWRITERS
a) Franklin/Templeton Distributors, Inc., (Distributors) also acts as
principal underwriter of shares of:
Franklin Asset Allocation Fund
Franklin California Tax-Free Income Fund, Inc.
Franklin California Tax-Free Trust
Franklin Custodian Funds, Inc.
Franklin Growth and Income Fund
Franklin Federal Money Fund
Franklin Federal Tax-Free Income Fund
Franklin Floating Rate Master Trust
Franklin Floating Rate Trust
Franklin Gold and Precious Metals Fund
Franklin High Income Trust
Franklin Investors Securities Trust
Franklin Managed Trust
Franklin Money Fund
Franklin Mutual Series Fund Inc.
Franklin Municipal Securities Trust
Franklin New York Tax-Free Income Fund
Franklin New York Tax-Free Trust
Franklin Real Estate Securities Trust
Franklin Strategic Mortgage Portfolio
Franklin Strategic Series
Franklin Tax-Exempt Money Fund
Franklin Tax-Free Trust
Franklin Templeton Fund Allocator Series
Franklin Templeton Global Trust
Franklin Templeton International Trust
Franklin Templeton Money Fund Trust
Franklin Value Investors Trust
Franklin Templeton Variable Insurance Products Trust
Institutional Fiduciary Trust
Templeton Capital Accumulator Fund, Inc.
Templeton Developing Markets Trust
Templeton Funds, Inc.
Templeton Global Investment Trust
Templeton Global Opportunities Trust
Templeton Global Smaller Companies Fund, Inc.
Templeton Growth Fund, Inc.
Templeton Income Trust
Templeton Institutional Funds, Inc.
b) The information required by this Item 29 with respect to each director
and officer of Distributors is incorporated by reference to Part B of this
N-1A and Schedule A of Form BD filed by Distributors with the Securities and
Exchange Commission pursuant to the Securities Act of 1934 (SEC File No.
8-5889).
c) Not Applicable. Registrant's principal underwriter is an affiliated
person of an affiliated person of the Registrant.
ITEM 28 LOCATION OF ACCOUNTS AND RECORDS
The accounts, books or other documents required to be maintained by Section
31 (a) of the Investment Company Act of 1940 are kept by the Trust or its
shareholder services agent, Franklin/Templeton Investor Services, Inc., both
of whose address is 777 Mariners Island Blvd., San Mateo, CA 94404-1585.
ITEM 29 MANAGEMENT SERVICES
There are no management-related service contracts not discussed in Part A or
Part B.
ITEM 30 UNDERTAKINGS
Not Applicable
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant certified that it meets all of the
requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of San Mateo and the State of
California, on the 26th day of October, 2000.
FRANKLIN TEMPLETON MONEY FUND TRUST
(Registrant)
By: /s/ David P. Goss
David P. Goss, Vice President
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities
and on the dates indicated.
RUPERT H. JOHNSON, JR.* Principal Executive Officer
-----------------------
Rupert H. Johnson, Jr. and Trustee
Dated: October 26, 2000
MARTIN L. FLANAGAN* Principal Financial Officer
------------------
Martin L. Flanagan Dated: October 26, 2000
KIMBERLEY H. MONASTERIO* Principal Accounting Officer
------------------------
Kimberley H. Monasterio Dated: October 26, 2000
FRANK H. ABBOTT III* Trustee
-------------------
Frank H. Abbott III Dated: October 26, 2000
HARRIS J. ASHTON* Trustee
----------------
Harris J. Ashton Dated: October 26, 2000
S. JOSEPH FORTUNATO* Trustee
--------------------
S. Joseph Fortunato Dated: October 26, 2000
CHARLES B. JOHNSON* Trustee
------------------
Charles B. Johnson Dated: October 26, 2000
FRANK W.T. LAHAYE* Trustee
-----------------
Frank W.T. LaHaye Dated: October 26, 2000
GORDON S. MACKLIN* Trustee
------------------
Gordon S. Macklin Dated: October 26, 2000
*BY /s/ David P. Goss
Attorney-in-Fact
(Pursuant to Power of Attorney filed herewith)
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, as amended, the undersigned has duly consented to the
filing of this Registration Statement of Franklin Templeton Money Fund Trust
and has caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of San Mateo and the State
of California, on the 26th day of October, 2000.
THE MONEY MARKET PORTFOLIOS
By: /s/ David P. Goss
David P. Goss, Vice President
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following trustees and officers of The
Money Market Portfolios in the capacities and on the dates indicated:
CHARLES E. JOHNSON* Trustee and Principal Executive
-------------------
Charles E. Johnson Officer
Dated: October 26, 2000
MARTIN L. FLANAGAN* Principal Financial Officer
-------------------
Martin L. Flanagan Dated: October 26, 2000
KIMBERLEY H. MONASTERIO* Principal Accounting Officer
------------------------
Kimberley H. Monasterio Dated: October 26, 2000
FRANK H. ABBOTT III* Trustee
--------------------
Frank H. Abbott III Dated: October 26, 2000
HARRIS J. ASHTON* Trustee
-----------------
Harris J. Ashton Dated: October 26, 2000
ROBERT F. CARLSON* Trustee
------------------
Robert F. Carlson Dated: October 26, 2000
S. JOSEPH FORTUNATO* Trustee
--------------------
S. Joseph Fortunato Dated: October 26, 2000
CHARLES B. JOHNSON* Trustee
-------------------
Charles B. Johnson Dated: October 26, 2000
RUPERT H. JOHNSON, JR.* Trustee
-----------------------
Rupert H. Johnson, Jr. Dated: October 26, 2000
FRANK W.T. LAHAYE* Trustee
------------------
Frank W.T. LaHaye Dated: October 26, 2000
GORDON S. MACKLIN* Trustee
------------------
Gordon S. Macklin Dated: October 26, 2000
*BY /s/ David P. Goss
Attorney-in-Fact
(Pursuant to Power of Attorney filed herewith)
FRANKLIN TEMPLETON MONEY FUND TRUST
REGISTRATION STATEMENT
EXHIBITS INDEX
EXHIBIT NO. DESCRIPTION LOCATION
EX-99.(a)(i) Certificate of Trust dated January 17, *
1995
EX-99.(a)(ii) Agreement and Declaration of Trust *
dated January 17, 1995
EX-99.(b)(i) By-Laws *
EX-99.(d)(i) Administration Agreement between the *
Registrant and Franklin Advisers,
Inc., on behalf of Franklin Templeton
Money Fund II, dated May 1, 1995
EX-99.(d)(ii) Amendment dated August 1, 1995 to *
Administration Agreement between the
Registrant and Franklin Advisers,
Inc., on behalf of Franklin Templeton
Money Fund II, dated May 1, 1995
EX-99.(e)(i) Underwriting Agreement between the *
Registrant and Franklin/Templeton
Distributors, Inc., dated May 1, 1995
EX-99.(e)(ii) Amendment to Underwriting Agreement *
dated January 12, 1999
EX-99.(e)(iii) Forms of Dealer Agreements between *
Franklin/Templeton Distributors, Inc.
and Securities Dealers
EX-99.(g)(i) Master Custody Agreement between the *
Registrant and Bank of New York dated
February 16, 1996
EX-99.(g)(ii) Amendment dated May 7, 1997 to the *
Master Custody Agreement dated
February 16, 1996 between Registrant
and Bank of New York
EX-99.(g)(iii) Amendment dated February 27, 1998 to *
Master Custody Agreement dated
February 16, 1996 between Registrant
and Bank of New York
EX-99.(g)(iv) Amendment dated August 30, 2000 to Attached
Exhibit A of the Master Custody
Agreement between Registrant and Bank
of New York dated February 16, 1996
EX-99.(g)(v) Terminal Link Agreement between the *
Registrant and Bank of New York dated
February 16, 1996
EX-99.(i)(i) Opinion and consent of counsel *
EX-99.(j)(i) Consent of Independent Auditors Attached
EX-99.(l)(i) Letter of Understanding dated April *
13, 1995
EX-99.(m)(i) Distribution Plan pursuant to Rule *
12b-1 between the Registrant and
Franklin/Templeton Distributors, Inc.,
dated May 1, 1995
EX-99.(m)(ii) Class B Distribution Plan between Attached
Registrant and Franklin/Templeton
Distributors, Inc. dated November 17,
1998
EX-99.(p) Code of Ethics Attached
EX-99.(q)(i) Power of Attorney for Franklin Attached
Templeton Money Fund Trust dated July
13, 2000
EX-99.(q)(ii) Power of Attorney for The Money Market Attached
Portfolios dated July 13, 2000
* Incorporated by Reference
