The Protected Cell is dedicated to investing in one or more share classes (each, an “Underlying Share Class”) of Franklin Templeton Investment Funds - Franklin Diversified Income Fund (the “Underlying Master Fund”). The primary investment objective of the Underlying Master Fund is to earn a high level of current income and, as a secondary objective, seek capital appreciation over the long term. The Underlying Master Fund invests principally in debt securities issued by governments, agencies and corporations located in any country, including to a lesser extent in Emerging Markets. 

• Seeks to maximize current income and has a secondary goal of capital appreciation over the long term.
• Planning to hold their investments for medium to long term.

Potential investors should be aware that an investment in the Protected Cell involves a high degree of risk and is suitable only for investors who fully understand and who can bear the risks of such an investment for an indefinite period. Listed below are the 'Certain Risk Factors' relating to an investment in the Protected Cell.

• Convertible securities risk: the risk associated with the fact the Fund may invest in convertible securities, which may be low-rated and which may act like either a bond (when the underlying equity value is well below par value for the security) or a stock (when the underlying equity value approaches or exceeds par value).
• Counterparty risk: the risk of failure of financial institutions or agents (when serving as a counterparty to financial contracts) to perform their obligations, whether due to insolvency, bankruptcy or other causes.
• Credit risk: the risk of loss arising from default that may occur if an issuer fails to make principal or interest payments when due. This risk is higher if the Fund holds low-rated, sub-investment-grade securities.
• Debt Securities risk: as interest rates rise debt securities will fall in value. Issuers of debt securities may fail to meet their regular interest and/or capital repayment obligations. All credit instruments therefore have potential for default. Higher yielding securities are more likely to default.
• Derivative Instruments risk: the risk of loss in an instrument where a small change in the value of the underlying investment may have a larger impact on the value of such instrument. Derivatives may involve additional liquidity, credit and counterparty risks.
• Distressed Securities risk: Securities are regarded as predominantly speculative with respect to the issuer's capacity to pay interest and principal or maintain other terms of the offer documents over any long period of time. They are generally unsecured and are outweighed by large uncertainties or major risk exposure to adverse economic conditions.
• Emerging markets risk: the risk related to investing in countries that have less developed political, economic, legal and regulatory systems, and that may be impacted by political/economic instability, lack of liquidity or transparency, or safekeeping issues.
• Foreign Currency risk: the risk of loss arising from exchange-rate fluctuations or due to exchange control regulations.
• Market risk: the risk of loss in value of securities traded on markets as prices of securities may be affected by factors such as economic, political, market, and issuer-specific changes.
• Securitisation risk: investment in securities which generate return from various underlying groups of assets such as mortgages, loans or other assets may bear a greater risk of loss due to possible default of some of the underlying assets.
• TBA Transaction risk: to be announced transactions (TBAs) are forward-settling mortgage-backed securities trades where the exact securities are unspecified at trade date but must meet defined criteria, exposing investors to market, counterparty, liquidity, and leverage risks. Funds may use TBAs to hedge or sell securities, facing risks of value fluctuations before settlement, including potential losses if security prices change adversely during TBA sale commitments or roll transactions.

All potential investors must carefully read the sections entitled "Certain Risk Factors and Potential Conflicts of Interest” in the Prospectus and Supplement before making an investment in the Protected Cell.