Fund Description: Franklin LibertyQ U.S. Equity ETF is an exchange-traded index fund or Index ETF which is a separate investment portfolio of the Franklin Templeton ETF Trust, an open-end investment management company. INVESTMENT OBJECTIVE: The Franklin LibertyQ U.S. Equity ETF seeks to provide investment returns that closely correspond to the price and yield performance of the LibertyQ U.S. Large Cap Equity Index. INDEX DESCRIPTION: The LibertyQ U.S. Large Cap Equity Index is a systematic, rules-based proprietary index that is maintained and calculated by FTSE Russell. The Index is based on the Russell 1000 Index using a methodology developed with Franklin Templeton to reflect Franklin Templeton’s desired investment strategy. The Russell 1000 Index is a subset of the Russell 3000 Index and is designed to measure the performance of large capitalization stocks in the United States. It includes approximately 1000 of the largest issuers based on a combination of their market cap and current index membership. The Index seeks to achieve a lower level of risk and higher risk-adjusted performance than the Russell 1000 Index over the long term by applying a multi-factor selection process, which is designed to select equity securities from the Russell 1000 Index that have favorable exposure to four investment style factors; quality, value, momentum and low volatility. Factors are common characteristics that relate to a group of issuers or securities that are important in explaining the returns and risks of those issuers’ securities. The quality factor incorporates measurements such as return on equity, gross profit over assets and gross margin sustainability. The value factor incorporates measurements such as forward earnings yield. The momentum factor incorporates measurements such as 6-month risk adjusted price momentum and 12-month risk-adjusted price momentum. The low volatility factor incorporates measurements such as historical beta (i.e., a measure of the volatility of a security relative to the total market). At the time of each semi-annual reconstitution of the Index, no company shall comprise more than 1% of the Index. FUND STRATEGY: Under normal market conditions, the Fund invests at least 80% of its assets in the component securities of the Index. The Fund, using a passive or indexing investment approach, seeks investment results that closely correspond to the performance of the Index. The Fund’s intention is to replicate the component securities of the Index as closely as possible. However, under various circumstances, it may not be possible or practicable to purchase all of the component securities in their respective weightings in the Index. In these circumstances, the Fund may use a representative sampling strategy whereby the Fund would invest in what it believes to be a representative sample of the component securities of the Index, but may not track the Index with the same degree of accuracy as would an investment vehicle replicating the entire Index. Under the representative sampling technique, the investment manager will select securities that collectively have an investment profile similar to that of the Index, including securities that resemble those included in the Index in terms of risk factors, performance attributes and other characteristics, such as market capitalization and industry weightings. The Fund’s portfolio is reconstituted semi-annually following the semi-annual reconstitution of the Index. FUND MANAGEMENT: Franklin Advisers, Inc. serves as the Investment Manager (Adviser) to the Fund.