Franklin Templeton is pleased to announce it has reduced the fees and expenses associated with its Franklin K2 Long Short Credit Fund (NASDAQ:FKLSX) (Class A) and has determined to increase the frequency of its distributions to quarterly from annually.

The reduction in the management fee lowers the annual rate to 1.50% of average daily net assets from the previous rate of 1.60%. The Fund's investment manager has also lowered the cap on the Fund's total operating expenses, as described in the Fund's current prospectus. Effective with respect to the calendar quarter ended June 30, 2022, the Fund will change its dividend and distribution policy to pay dividends quarterly. The change to a quarterly dividend distribution is designed to address the desire of shareholders seeking more frequent income distributions, or for investors who have a sole or primary focus on income.

"Launched in 2015, the actively managed hedged strategy has been used as a complement to high yield as well as a bond diversifier for those looking for income given its capabilities to mitigate credit risk and reduce interest rate risk, while offering the possibility of a compelling risk-adjusted return," said Brooks Ritchey, co CIO K2 Advisors.

The Fund is actively managed and seeks total return over a complete market cycle (through a combination of current income, capital preservation and capital appreciation), by allocating its assets to institutional quality subadvisors and across multiple alternative fixed income and credit strategies, primarily including Credit Long Short, Structured Credit, and Emerging Market Fixed Income.

Rob Christian, co CIO K2 Advisors stated, "With the tremendous evolution in fixed income markets—from new types of instruments to more accessible global markets—there are more ways than ever before to express investment views, capitalize on potential opportunities and seek to protect against risks. We see hedged fixed income strategies as a meaningful component of this new paradigm in credit investing on behalf of our investors."

K2 Advisor is part of Franklin Templeton's Alternatives business and spans a broad range of strategies including real estate, private credit, and hedge fund strategies, with approximately $154 billion in assets under management as of January 31, 2022.

About Franklin Templeton

Franklin Resources, Inc. (NYSE:BEN) is a global investment management organization with subsidiaries operating as Franklin Templeton and serving clients in over 155 countries. Franklin Templeton's mission is to help clients achieve better outcomes through investment management expertise, wealth management and technology solutions. Through its specialist investment managers, the company offers boutique specialization on a global scale, bringing extensive capabilities in equity, fixed income, multi-asset solutions and alternatives. With offices in more than 30 countries and approximately 1,300 investment professionals, the California-based company has 75 years of investment experience and over $1.5 trillion in assets under management as of January 31, 2022. For more information, please visit franklintempleton.com and follow us on LinkedIn, Twitter and Facebook.

Dividends can fluctuate, and there is no guarantee dividends will be paid.

All investments involve risks, including possible loss of principal. The market values of securities owned by the Fund will go up or down, sometimes rapidly or unpredictably. The Fund's performance depends on the manager's skill in selecting, overseeing, and allocating Fund assets to the sub-advisors. The Fund is actively managed and could experience losses if the manager's and sub-advisors' judgment about particular Fund portfolio investments prove to be incorrect. Some sub-advisors may have little or no experience managing the assets of a registered investment company. Bond prices generally move in the opposite direction of interest rates. Changes in the financial strength of a bond issuer or in a bond's credit rating may affect its value. Lower-rated or high yield debt securities ("junk bonds") involve greater credit risk, including the possibility of default or bankruptcy. Liquidity risk exists when securities become more difficult to sell, or are unable to be sold, at the price at which they've been valued. Investments in derivatives involve costs and create economic leverage, which may result in significant volatility and cause the Fund to participate in losses (as well as gains) that significantly exceed the Fund's initial investment. The Fund may make short sales of securities, which involves the risk that losses may exceed the original amount invested. Please see the prospectus and summary prospectus for information on these as well as other risk considerations, including the risks of foreign investments.

Investors should carefully consider a fund's investment goals, risks, charges and expenses before investing. To obtain a prospectus, which contains this and other information, visit our website at franklintempleton.com. Please read the prospectus carefully before investing.

Franklin Distributors, LLC. Member FINRA, SIPC.

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