REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
|
/X/
|
Pre-Effective
Amendment No.
|
/
/
|
Post-Effective
Amendment No. 30
|
/X/
|
and/or
|
|
REGISTRATION
STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940
|
/X/
|
Amendment
No. 33
|
X
|
immediately
upon filing pursuant to paragraph (b)
|
||
|
on
_____________
pursuant to paragraph (b)
|
||
|
60
days after filing pursuant to paragraph (a)(1)
|
||
|
on
_____________ pursuant to paragraph (a)(1)
|
||
|
75
days after filing pursuant to paragraph (a)(2)
|
||
|
on
____________
pursuant to paragraph (a)(2) of Rule 485.
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||
If appropriate, check the following box: | |||
|
This
post-effective amendment designates a new effective date for a previously
filed post-effective amendment.
|
PROSPECTUS
October
31, 2006
Matthews
Asia Pacific
Equity
Income Fund
|
Please
read this document
carefully
before you make
any
investment decision. If
you
have any questions, do
not
hesitate to contact us at
800-789-ASIA
[2742] or visit
www.matthewsfunds.com.
Also,
please keep this
Prospectus
with your
other
account documents for
future
reference.
|
||
Investment
Objective of the Fund
|
4
|
|
Principal
Investment Strategy
|
4
|
|
Principal
Risks of Investing in the Fund
|
5
|
|
Past
Performance
|
10
|
|
Please
see important
information
about
redemption
fees
on
page 18
The
Matthews Asia Pacific Equity
Income
Fund is part of the
Matthews
Asian Funds family.
Other
funds in the Matthews Asian Funds family are offered
through
a separate prospectus
that
can be obtained from
Matthews
Asian Funds or its
Distributor,
PFPC Distributors,
Inc.
|
Fees
and Expenses
|
10
|
Management
of the Fund
|
11
|
|
Shareholder
Information
|
||
Pricing
of Fund
Shares
|
12
|
|
Purchase
of
Shares
|
13
|
|
Exchange
of
Shares
|
16
|
|
Selling
(Redeeming)
Shares
|
16
|
|
Redemption
Fees
|
18
|
|
Other
Shareholder
Information
|
19
|
|
General
Information
|
22
|
|
Privacy
Statement
|
23
|
OBJECTIVE:
Total
return with an emphasis
on
providing current income
PORTFOLIO
MANAGERS:
Lead
Manager:
Andrew
T. Foster
Co-Manager:
Jesper
Madsen
|
||
SYMBOL:
MAPIX
|
SHAREHOLDER
FEES (FEES
PAID DIRECTLY FROM YOUR INVESTMENT)
|
|
Maximum
Sales Charge (Load) imposed on purchases (as a percentage
of offering
price)
|
None
|
Maximum
Sales Charge (Load) imposed on reinvested dividends
(as
a percentage of offering price)
|
None
|
Maximum
Deferred Sales Charge (Load)
(as
a percentage of original purchase price)
|
None
|
Redemption
Fee on shares redeemed within 90 calendar days of purchase
(as
a percentage of amount redeemed)
|
2.00%*
|
OPERATING
EXPENSES (EXPENSES
THAT ARE DEDUCTED FROM FUND ASSETS)
|
|
Management
Fee
|
0.75%**
|
Distribution
(12b-1) Fees
|
None
|
Administration
and Shareholder Servicing Fees
|
0.25%†
|
Other
Expenses
|
0.47%††
|
Total
Annual Operating Expenses
|
1.47%*†
|
One
Year
|
$150
|
Three
Years
|
$465
|
Initial
investment:
|
$2,500
|
|
Subsequent
investments:
|
$250
|
Initial
investment:
|
$500
|
|
Subsequent
investments:
|
$50
|
|
|
|
|
Opening
an account
(Initial
Investment)
|
Adding
to an Account
(Subsequent
Investments)
|
BY
MAIL
|
n
Complete and sign application
n
Make check payable to:
Matthews
Asian Funds
n
Mail application and check to:
|
n
Make check payable to:
Matthews Asian
Funds
n
Mail check with a statement stub indicating your
fund(s) selection
to:
|
Regular Mail | Matthews
Asian Funds
P.O.
Box 9791
Providence,
RI 02940
|
Matthews
Asian Funds
P.O.
Box 9791
Providence,
RI 02940
|
Overnight Delivery | Matthews
Asian Funds
101
Sabin Street
Pawtucket,
RI 02860-1427
|
Matthews
Asian Funds
101
Sabin Street
Pawtucket,
RI 02860-1427
|
BY
PHONE
*Note
that wire fees are charged by most banks.
|
n
Call 800-789-ASIA [2742] or visit
www.matthewsFund.com for a New Account
Application.
n
Complete and sign the New Account Application
n
Send your New Account Application by regular mail
or overnight
delivery to one of the addresses above
Wire*
n
Then
wire funds using instructions at right
|
n Notify
Fund’s agent by calling 800-789-ASIA [2742].
Wire*
n
Then wire funds to:
PNC
Bank
ABA
#031000053
Credit:
Matthews Asia Pacific Equity Income Fund
Account
#8606905986
FBO:
[your name and account number]
|
VIA
INTERNET**
|
You
cannot currently open a new account over the Internet.
|
n
When
you open your account, complete
the Online
Account Access
section
and attach a voided
check.
n
After
you have received confirmation
of your purchase, call
800-789-ASIA [2742] and request a
personal identification number
(PIN).
n
Go
to www.matthewsfunds.com
and click on
Account Access. |
VIA
AUTOMATIC
INVESTMENT
PLAN**
|
N/A
|
n
Complete
the Automatic Investment Plan section of the application.
Be sure to sign
the application and include a voided check.
|
THROUGH
A BROKER OR INTERMEDIARY
|
n
Contact
your broker or intermediary, who may charge you a fee for
their
services.
|
n
Contact
your broker or intermediary, who may charge you a fee for
their
services.
|
Selling
(Redeeming) shares
|
||
BY
MAIL
|
n
Send
a letter to the Fund at the following address:
|
|
|
|
|
Regular
Mail:
|
Matthews
Asian Funds
P.O.
Box 9791
Providence,
RI 02940
|
|
|
|
|
Overnight
Delivery:
|
Matthews
Asian Funds
101
Sabin Street
Pawtucket,
RI 02860-1427
The
letter must include your name and account number, the name
of the Fund,
and the amount you want to sell in dollars or shares. This
letter must be
signed by each owner of the account.
For
security purposes, a medallion signature guarantee will
be required
if:
n
Your
written request is for an amount over $100,000; or
n
The
money is to be paid to anyone other than the registered
owners;
or
n
The
money is to be sent to an address that is different from
the registered
address or to a bank account other than the account that
was
preauthorized.
|
|
BY
PHONE
|
Call
800-789-ASIA [2742]. When you open your account you will
automatically
have the ability to exchange and redeem shares by telephone
unless you
specify otherwise on your New Account Application.
|
|
|
|
|
BY
WIRE
|
If
you have wiring instructions already established on your
account, contact
us at 800-789-ASIA [2742] to request a redemption by wire.
Please note
that the Fund charges $9.00 for wire redemptions, in addition
to a wire
fee that may be charged by your bank.
Note:
When you opened your account you must have provided the
wiring
instructions for your bank with your application.*=
|
|
|
= If
your account has already been opened, you may send us a
written request to
add wiring instructions to your account. Send your request
to one of the
addresses above and include a signature guarantee.
|
|
VIA
INTERNET
|
You
must have already obtained Online Account Access and a
PIN from the Fund’s
transfer agent. (See “Adding
to an Account: Via Internet”
on
page 14.)
Go
to www.matthewsfunds.com
and click on Account Access, then follow the instructions
on how to place
a redemption.
|
|
|
|
|
THROUGH
A BROKER OR INTERMEDIARY
|
Contact
your broker or intermediary, who may charge you a fee for
their
services.
|
|
|
|
•
|
Reject
a purchase or exchange
|
•
|
Delay
payment of immediate cash redemption proceeds for up to seven
calendar
days
|
•
|
Revoke
a shareholder’s privilege to purchase Fund shares (including
exchanges)
|
•
|
Limit
the amount of any exchange
|
For
additional information
about
Matthews Asian Funds:
|
|
www.matthewsfunds.com
|
|
800-789-ASIA
[2742]
|
|
Matthews
Asian Funds
P.O.
Box 9791
Providence,
RI 02940
|
|
Investment
Company Act
File
Number: 811-08510
|
|
Distributed
by PFPC Distributors, Inc.
|
|
|
|
Matthews
Asian Funds
www.matthewsfunds.com
|
|
|
|
|
|
Matthews
Asian Funds
P.O.
Box 9791
Providence,
RI 02940
|
|
|
MAPEIFP-1006-50M-FST
|
800-789-ASIA
[2742]
|
TABLE
OF CONTENTS
|
PAGE
|
Fund
History
|
3
|
Description
of the Fund
|
3
|
Classification
|
3
|
Investment
Process
|
4
|
Investment
Objective
|
5
|
Principal
Investment Strategy and Risks
|
5
|
Additional
Investment Strategies
|
12
|
Fund
Policies
|
24
|
Temporary
Defensive Position
|
25
|
Portfolio
Turnover
|
26
|
Disclosure
of Portfolio Holdings
|
26
|
Management
of the Fund
|
27
|
Shareholders’
Voting Powers
|
33
|
Compensation
|
34
|
Code
of Ethics
|
34
|
Proxy
Voting Policies and Procedures
|
35
|
Control
Persons and Principal Holders of Securities
|
36
|
Investment
Advisory and Other Service Providers
|
36
|
Brokerage
Allocation and Other Practices
|
43
|
Shares
of Beneficial Interest
|
44
|
Purchase,
Redemption and Pricing of Shares
|
45
|
Taxation
of the Trust
|
48
|
Other
Information
|
50
|
Reports
to Shareholders
|
51
|
Financial
Statements
|
51
|
1.
|
Issue
senior securities;
|
2.
|
Borrow
money, except that the Fund may borrow from banks and enter
into reverse
repurchase agreements for temporary purposes in amounts up
to one-third of
the value of its total assets at the time of such borrowing;
or mortgage,
pledge, or hypothecate any assets, except in connection with
any such
borrowing and in amounts not in excess of the lesser of the
dollar amounts
borrowed or 10% of the value of the total assets of the Fund
at the time
of its borrowing. All borrowing will be done from a bank, and
asset
coverage of at least 300% is required. The Fund will not purchase
securities when borrowings exceed 5% of the Fund’s total net
assets;
|
3.
|
Act
as an underwriter of securities, except that, in connection
with the
disposition of a security, the Fund may be deemed to be an
“underwriter”
as that term is defined in the 1933 Act;
|
|
|
4.
|
Purchase
the securities of issuers conducting their principal business
activities
in the same industry (other than obligations issued or guaranteed
by the
U.S. government, its agencies or instrumentalities) if immediately
after
such purchase, the value of the Fund’s investments in such industry would
exceed 25% of the value of the total assets of the
Fund;
|
|
|
5.
|
Purchase
or sell real estate, real estate limited partnership interests,
interests
in oil, gas and/or mineral exploration or development programs
or leases.
This restriction shall not prevent the Fund from investing
directly or
indirectly in portfolio instruments secured by real estate
or interests
therein or acquiring securities of real estate investment
trusts or other
issuers that deal in real estate;
|
|
|
6.
|
Make
loans, except that this restriction shall not prohibit (i)
the purchase
and holding of debt instruments in accordance with the Fund’s investment
objectives and policies, (ii) the lending of portfolio securities,
or
(iii) entry into repurchase agreements with banks or
broker-dealers;
|
|
|
7.
|
Change
its diversification status under the 1940 Act;
|
|
|
8.
|
Purchase
or sell commodities or commodity contracts, except that the
Fund may
purchase or sell currencies, may enter into futures contracts
on
securities, currencies, or on indexes of such securities
or currencies, or
any other financial instruments, and may purchase or sell
options on such
futures contracts;
|
|
|
9.
|
Make
investments in securities for the purpose of exercising control;
or
|
|
|
10.
|
Purchase
the securities of any one issuer if, immediately after such
purchase, the
Fund would own more than 10% of the outstanding voting securities
of such
issuer.
|
1.
|
Following
the end of each fiscal quarter (generally within 60 days),
the Fund’s full
portfolio holdings will be made publicly available by the following
means:
|
a.
|
The
Fund shall send shareholders portfolio holdings in the Fund’s annual,
semi-annual and quarterly reports, which are mailed to shareholders
and
posted on the Fund’s website.
|
|
b.
|
PFPC
shall send portfolio holdings to nationally recognized rating
agencies via
electronic transmission.
|
2.
|
The
Fund will also release top ten holdings on a monthly basis
via the Fund’s
website and written communication within approximately 21 days
of each
month end;
|
3.
|
The
Fund or a Service Provider does not disclose the Fund’s portfolio security
holdings in advance of general release and without delay
except to the
Fund’s custodian bank, independent public accountant, independent
legal
counsel, proxy voting agent, financial printers, technology
service
provider, and pricing service provider. The Fund also discloses
its
portfolio security holdings to third parties in connection
with its
on-going efforts to analyze its trading activity, and in
connection with
its periodic reviews of the performance of existing fund
agents and
advisers or the retention of new agents and advisers. In
addition, the
Fund may make such disclosure on a confidential basis to
selected third
parties when the Fund has a legitimate business purpose
for doing so.
Examples of legitimate business purposes in which selective
disclosure of
the Fund’s portfolio securities may be appropriate include disclosure
for
due diligence purposes to an investment advisor that is
in merger or
acquisition talks with the Advisor; disclosure to a newly
hired investment
advisor or sub-advisor prior to its commencing its duties;
and disclosure
to a rating or ranking organization. Currently the Fund
has no such
disclosure arrangements in
place.
|
Name,
Year of Birth,
and
Address
|
Position(s)
Held
with the
Trust
|
Term
of
Office
and
Length
of
Time
Served1
|
Principal
Occupation(s)
During
Past 5 Years
|
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Trustee
|
Other
Trusteeships/
Directorships
(number
of portfolios)
Held
by Trustee
|
INDEPENDENT
TRUSTEES
|
|||||
Richard
K. Lyons
Born
1961
Four
Embarcadero Center
Suite
550
San
Francisco, CA 94111
|
Chairman
of the Board of Trustees and Trustee
|
Since
1994
|
Executive
Associate Dean (since 2005) and Sylvan Coleman Professor
of Finance (since
2004) Acting Dean (2004-2005) and Professor (since 1993),
Haas School of
Business, University of California at Berkeley; Consultant
for IMF World
Bank, Federal Reserve Bank and Citibank, N.A. (since
2000).
|
9
|
Director,
iShares Fund Complex, consisting of iShares, Inc. (24 portfolios)
and
iShares Trust (over 70 portfolios) managed by Barclays Global
Investors;
Trustee, Barclays Global Investor Fund Complex, consisting
of Barclays
Global Investor Funds and Barclays Master Investment Portfolios
(15
portfolios).
|
Robert
K. Connolly
Born
1932
Four
Embarcadero Center
Suite
550
San
Francisco, CA 94111
|
Trustee
|
Since
1994
|
Retired
since 1990. Prior thereto: Institutional Sales Manager and
Securities
Analyst for Barrington Research Associates.
|
9
|
None
|
Toshi
Shibano
Born
1950
Four
Embarcadero Center
Suite
550
San
Francisco, CA 94111
|
Trustee
|
Since
2003
|
President,
Toshi Shibano Consulting, Inc. since 1995; Adjunct Associate
Professor,
Columbia Graduate School of Business since 2001; Adjunct
Professor,
Thunderbird American Graduate School of International Management
2000-2005; Faculty, General Electric Corporate Leadership
Development
Center since 2000; Executive Education Lecturer, Haas School
of Business,
University of California at Berkeley since 1995.
|
9
|
None
|
Name,
Year of Birth,
and
Address
|
Position(s)
Held
with the
Trust
|
Term
of
Office
and
Length
of
Time
Served1
|
Principal
Occupation(s)
During
Past 5 Years
|
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Trustee
|
Other
Trusteeships/
Directorships
(number
of portfolios)
Held
by Trustee
|
Geoffrey
H. Bobroff
Born
1944
Four
Embarcadero Center
Suite
550
San
Francisco, CA 94111
|
Trustee
|
Since
2006
|
President,
Bobroff Consulting, Inc. (since 1993).
|
9
|
None
|
Rhoda
Rossman
Born
1958
Four
Embarcadero Center
Suite
550
San
Francisco, CA 94111
|
Trustee
|
Since
2006
|
Senior
Vice President, Treasurer, Portfolio Manager (since 2003);
Vice
President and Treasurer (2001-2003); Assistant Vice President
(1999-2001);
Portfolio Manager (1997-2001), The PMI Group, Inc.
|
9
|
Director
of each of PMI Mortgage Insurance Co., PMI Mortgage Guaranty
Co., PMI
Mortgage Services Co., Residential Guaranty Co., Residential
Insurance
Co., PMI Securities Co., Commercial Loan Insurance Corporation,
WMAC
Credit Insurance Corporation, PMI Mortgage Insurance Ltd.,
and PMI
Mortgage Insurance Australia (Holdings) Pty. Limited.
|
INTERESTED
TRUSTEES2
|
|||||
David
FitzWilliam-Lay
Born
1931
Four
Embarcadero Center
Suite
550
San
Francisco, CA 94111
|
Trustee
|
Since
1994
|
Retired
in 1993. Prior thereto Chairman of GT Management, PLC, United
Kingdom.
|
9
|
None
|
G.
Paul Matthews
Born
1956
Four
Embarcadero Center Suite 550
San
Francisco, CA 94111
|
Trustee
and President
|
Since
1994
|
Chairman and Chief Investment Officer, Matthews International Capital Management, LLC since 1991. |
9
|
N/A
|
OFFICER(S)
WHO ARE NOT TRUSTEES2
|
|||||||
Mark
W. Headley
Born
1959
Four
Embarcadero Center Suite 550
San
Francisco, CA 94111
|
Vice
President
|
Since
1999
|
Chief
Executive Officer, President and Portfolio Manager, Matthews
International
Capital Management, LLC since 2001; President and Portfolio
Manager,
1999-2001; Portfolio Manager and Managing Director 1996-1999.
|
N/A
|
N/A
|
||
Andrew
T. Foster
Born
1974
Four
Embarcadero Center Suite 550
San
Francisco, CA 94111
|
Vice
President
|
Since
2005
|
Director
of Research and Portfolio Manager, Matthews International Capital
Management, LLC since 2003; Student at INSEAD, Fontainebleau,
France;
M.B.A, in 2002; Analyst, Matthews International Capital Management,
LLC,
1998-2001.
|
N/A
|
N/A
|
||
John
P. McGowan
Born
1964
Four
Embarcadero Center Suite 550
San
Francisco, CA 94111
|
Vice
President and Secretary
|
Since
2005
|
Chief
Operating Officer, Matthews International Capital Management,
LLC, since
2004; Chief Operating Officer, Treasurer, and Chief Compliance
Officer,
Forward Management LLC, 1998-2004.
|
N/A
|
N/A
|
||
Shai
Malka
Born
1973
Four
Embarcadero Center Suite 550
San
Francisco, CA 94111
|
Treasurer
|
Since
2005
|
Senior
Manager of Fund Accounting and Operations since 2004; Manager
of Fund
Accounting (2003-2004, Fund Accountant (2000-2003), Matthews
International
Capital Management, LLC; Supervisor of Fund Accounting, SEI
Investments,
1999-2000.
|
N/A
|
N/A
|
Manoj
K. Pombra
Born
1964
Four
Embarcadero Center Suite 550
San
Francisco, CA 94111
|
Chief
Compliance Officer
|
Since
2005
|
Chief
Compliance Officer, Matthews International Capital Management,
LLC since
March 2005; Senior Manager, Mutual Fund Compliance/Manager
Portfolio
Compliance, Franklin Templeton Investments,
April
2001-March 2005; Senior
Financial Reporting Manager, InfoUSA.com,
May
2000-March 2001.
|
N/A
|
N/A
|
1 |
Each
Trustee serves for an indefinite term, until retirement age
or until
his/her successor is elected. Officers serve at the pleasure
of the Board
of Trustees.
|
2
|
These
Trustees and officers are considered “interested persons” of the Trust as
defined under the 1940 Act either because of an ownership interest
in the
Advisor or an office held with the Trust.
|
Name
of Trustee
|
Dollar
Range of
Equity
Securities in the Matthews Asian Funds
|
Aggregate
Dollar
Range
of
Equity
Securities in
All
Registered
Investment
Companies
Overseen
by
Trustee within the
Family
of Investment
Companies
|
Richard
K. Lyons
|
§ Matthews
Pacific Tiger Fund ($10,001-$50,000)
§ Matthews
Asian Growth and Income Fund (Above $100,000)
|
Above
$100,000
|
Robert
K. Connolly
|
§ Matthews
Asian Growth and Income Fund ($10,001-$50,000)
§ Matthews
China Fund ($1-$10,000)
§ Matthews
Asia Pacific Fund ($1-$10,000)
|
$10,001-$50,000
|
Toshi
Shibano
|
§ Matthews
China Fund ($10,001-$50,000)
|
$10,001-$50,000
|
Geoffrey
H. Bobroff
|
§ Matthews
Pacific Tiger Fund ($10,001-$50,000)
§ Matthews
Asian Growth and Income Fund ($10,001-$50,000)
|
$10,001-$50,000
|
Rhoda
Rossman
|
§ Matthews
Asian Growth and Income Fund ($10,001-$50,000)
§ Matthews
Pacific Tiger Fund ($10,001-$50,000)
§ Matthews
India Fund ($10,001-$50,000)
|
$10,001-$50,000
|
David
FitzWilliam-Lay
|
None
|
None
|
G.
Paul Matthews
|
§ Matthews
Asia Pacific Fund ($50,001-$100,000)
§ Matthews
Pacific Tiger Fund (Above $100,000)
§ Matthews
Asian Growth and Income Fund (Above $100,000)
§ Matthews
Asian Technology Fund ($10,001-$50,000)
§ Matthews
China Fund ($10,001-$50,000)
§ Matthews
India Fund ($10,001-$50,000)
§ Matthews
Japan Fund ($10,001-$50,000)
§ Matthews
Korea Fund ($10,001-$50,000)
|
Above
$100,000
|
Fiscal
Year End of 12-31-05
|
||||
Independent
Trustee
|
Aggregate
Compensation
from
the Trust
|
Pension
or Retirement
Benefits
Accrued as
Part
of Fund
Expenses
|
Estimated
Annual
Benefits
Upon
Retirement
|
Total
Compensation
From
Fund
Complex
Paid
to Trustees*
|
Richard
K. Lyons
|
$36,500
|
None
|
None
|
$36,500
|
Robert
K. Connolly
|
$29,000
|
None
|
None
|
$29,000
|
Toshi
Shibano
|
$29,000
|
None
|
None
|
$29,000
|
1.
|
Its
allocated portion of the fees and expenses of the Trust’s Independent
Trustees;
|
2.
|
Its
allocated portion of the salaries and expenses of the Trust’s officers or
employees who are not affiliated with the Advisor;
|
3.
|
Interest
expenses;
|
4.
|
Taxes
and governmental fees;
|
5.
|
Brokerage
commissions and other expenses incurred in acquiring or disposing
of
portfolio securities;
|
6.
|
The
expenses of registering and qualifying shares for sale with
the SEC and
with various state securities commissions;
|
7.
|
Accounting
and legal costs;
|
8.
|
Its
allocated portion of the Trust’s insurance premiums;
|
9.
|
Its
allocated portion of fees and expenses of the Trust’s custodian,
administrator and transfer agent and any related
services;
|
10.
|
Expenses
of obtaining quotations of the Fund’s portfolio securities and of pricing
the Fund’s shares;
|
11.
|
Its
allocated portion of expenses of maintaining the Trust’s legal existence
and of shareholders’ meetings;
|
12.
|
Its
allocated portion of expenses of preparation and distribution
to existing
shareholders of reports, proxies and prospectuses;
|
13.
|
Its
allocated portion of fees and expenses of membership in industry
organizations; and
|
14.
|
Its
allocated portion of expenses related to the development and
maintenance
of the Trust’s Compliance Program as required by the 1940
Act.
|
Name
of
Portfolio
Manager
|
Account
Category
|
Number
of
Accounts
|
Total
Assets
in
Accounts
|
Number
of
Accounts
Where
Advisory
Fee is
Based
on
Account
Performance
|
Total
Assets in
Accounts
Where
Advisory
Fee is
Based
on
Account
Performance
|
Andrew
T. Foster
Lead
Portfolio Manager of the Matthews India Fund; Co-Portfolio
Manager of the
Matthews Asia Pacific, Asian Growth and Income, and Asian
Technology
Funds.
|
Registered
Investment Companies
|
1
|
$535,247,800
|
0
|
0
|
Other
Pooled Investment Vehicles
|
1
|
$76,942,110
|
0
|
0
|
|
Other
Accounts
|
0
|
0
|
0
|
0
|
|
Jesper
Madsen
|
Registered
Investment Companies
|
0
|
0
|
0
|
0
|
Other
Pooled Investment Vehicles
|
0
|
0
|
0
|
0
|
|
Other
Accounts
|
0
|
0
|
0
|
0
|
Base
Salary
|
Each
portfolio manager receives a fixed base salary that takes into
account his
or her experience and responsibilities and is intended to be
competitive
with salaries offered by other similar firms.
|
Bonus
|
The
Advisor emphasizes teamwork and a focus on client needs. Bonuses
are
structured to emphasize those principles and are based on a
number of
factors, including the profitability of the Advisor, the employee’s
contributions to the firm, the performance of accounts managed
by the
employee and, in some cases, assets under management.
|
Benefit
Programs
|
Portfolio
managers participate in benefit plans and programs available
generally to
all employees.
|
Equity
Ownership
|
Most
portfolio managers are members of the Advisor, which is a
private limited
liability company. An employee’s interest in the Advisor provides
pass-through income of the Advisor’s profits and losses. Subject to
certain required amounts, member distributions are generally determined
based on considerations of the Advisor’s working capital requirements and
on estimated tax liabilities associated with the pass-through
of
income.
|
Item
23.
|
Exhibits
|
(a)
|
Trust
Instrument and Certificate of Trust is incorporated herein by reference
to
and was filed electronically with Post-Effective Amendment No.
5 on
December 26, 1996.
|
(b)
|
By-Laws
are incorporated herein by reference to and were filed electronically
with
Post-Effective Amendment No. 5 on December 26, 1996.
|
(c)
|
Not
Applicable.
|
(d)(1)
|
Form
of Investment Advisory Agreement between Matthews International
Funds and
Matthews International Capital Management, LLC, is incorporated
herein by
reference to and was filed electronically with Post-Effective Amendment
No. 16 on December 21, 2001.
|
(d)(2)
|
Investment
Advisory Agreement between Matthews International Capital Management,
LLC
and Matthews International Funds on behalf of the Matthews Asia
Pacific
Fund, dated October 31, 2003, is incorporated herein by reference
to and
was filed electronically with Post-Effective Amendment No. 20 on
December
23, 2003.
|
(d)(3)
|
Investment
Advisory Agreement between Matthews International Capital Management,
LLC
and Matthews International Funds on behalf of each series of the
Trust,
dated August 31, 2004, is incorporated herein by reference to and
was
filed electronically with Post-Effective Amendment No. 22 on October
28,
2004.
|
(d)(4)
|
Amended
Appendix A to the Investment Advisory Agreement between Matthews
International Capital Management, LLC and Matthews International
Funds,
dated August 12, 2005 to reflect the addition of the Matthews India
Fund,
is incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 27 on October 31, 2005.
|
(d)(5)
|
Amended
Appendix A to the Investment Advisory Agreement between Matthews
International Capital Management, LLC and Matthews International
Funds,
dated August 11, 2006 to reflect the addition of the Matthews Asia
Pacific
Equity Income Fund, is incorporated herein by reference to and
was filed
electronically with Post-Effective Amendment No. 29 on August 15,
2006.
|
(e)(1)
|
Underwriting
Agreement for Matthews International Funds with PFPC Distributors,
Inc.,
dated December 31, 2000, is incorporated herein by reference to
and was
filed electronically with Post-Effective Amendment No. 16 on July
16,
2001.
|
(e)(2)
|
Amended
Schedule A to Underwriting Agreement for Matthews International
Funds with
PFPC Distributors, Inc., dated August 15, 2003 to reflect the addition
of
the Matthews Asia Pacific Fund, is incorporated herein by reference
to and
was filed electronically with Post-Effective Amendment No. 20 on
December
23, 2003.
|
(e)(3)
|
Amended
Schedule A to Underwriting Agreement for Matthews International
Funds with
PFPC Distributors, Inc., dated August 12, 2005 to reflect the addition
of
the Matthews India Fund, is incorporated herein by reference to
and was
filed electronically with Post-Effective Amendment No. 27 on October
31,
2005.
|
(e)(4)
|
Amended
Schedule A to Underwriting Agreement for Matthews International
Funds with
PFPC Distributors, Inc., dated August 11, 2006 to reflect the addition
of
the Matthews Asia Pacific Equity Income Fund, is incorporated herein
by
reference to and was filed electronically with Post-Effective Amendment
No. 29 on August 15, 2006.
|
(f)
|
Not
Applicable.
|
(g)(1)
|
Custody
Agreement with The Bank of New York, dated September 25, 2000 is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 16 on December 21, 2001.
|
(g)(2)
|
Amended
Schedule II to Custody Agreement with The Bank of New York, dated
August
15, 2003 to reflect the addition of the Matthews Asia Pacific Fund,
is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 20 on December 23, 2003.
|
(g)(3)
|
Amended
Schedule II to Custody Agreement with The Bank of New York, dated
August
12, 2005 to reflect the addition of the Matthews India Fund, is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 27 on October 31, 2005.
|
(g)(4)
|
Amended
Schedule II to Custody Agreement with The Bank of New York, dated,
dated
August 11, 2006 to reflect the addition of the Matthews Asia Pacific
Equity Income Fund, is incorporated herein by reference to and
was filed
electronically with Post-Effective Amendment No. 29 on August 15,
2006.
|
(h)(1)
|
Investment
Company Services Agreement for Matthews International Funds with
FPS Services, Inc., dated October 1, 1997, is incorporated herein
by
reference to and was filed electronically with Post-Effective Amendment
No. 8 on December 31, 1997.
|
(h)(1)(i)
|
Amendment
to Investment Company Services Agreement dated November 11, 1997,
is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 8 on December 31, 1997.
|
(h)(1)(ii)
|
Amendment
to Investment Company Services Agreement, dated July 31, 1998,
is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 16 on December 21, 2001.
|
(h)(1)(iii)
|
Amendment
to Investment Company Services Agreement, dated December 30, 1998,
is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 16 on December 21, 2001.
|
(h)(1)(iv)
|
Amendment
No. 3 to Investment Company Services Agreement, dated October 15,
1999, is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 13 on December 20, 1999.
|
(h)(1)(v)
|
Amendment
to Investment Company Services Agreement, dated December 1, 1999,
is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 13 on December 20, 1999.
|
(h)(1)(vi)
|
Amendment
to Investment Company Services Agreement, dated May 1, 2001, is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 16 on December 21, 2001.
|
(h)(1)(vii)
|
Anti-Money
Laundering and Privacy Amendment dated, July 24, 2002 to Investment
Company Services Agreement, is incorporated herein by reference
to and was
filed electronically with Post-Effective Amendment No. 18 on July
18,
2003.
|
(h)(1)(viii)
|
Amendment
to Investment Company Services Agreement, dated August 1, 2002,
is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 18 on July 18, 2003.
|
(h)(1)(ix)
|
Amendment
to Investment Company Services Agreement, dated August 15, 2003
to reflect
the addition of the Matthews Asia Pacific Fund, is incorporated
herein by
reference to and was filed electronically with Post-Effective Amendment
No. 20 on December 23, 2003.
|
(h)(1)(x)
|
Customer
Identification Services Amendment to Investment Company Services
Agreement, dated October 1, 2003, is incorporated herein by reference
to
and was filed electronically with Post-Effective Amendment No.
20 on
December 23, 2003.
|
(h)(1)(xi)
|
Amended
and Restated Investment Company Services Agreement dated June 1,
2004 is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 27 on October 31, 2005.
|
(h)(1)(xii)
|
Amended
Schedule A to Investment Company Services Agreement, dated August
12, 2005
to reflect the addition of the Matthews India Fund, is incorporated
herein
by reference to and was filed electronically with Post-Effective
Amendment
No. 27 on October 31, 2005.
|
(h)(1)(xiii)
|
Amended
Schedule A to Investment Company Services Agreement, dated, dated
August
11, 2006 to reflect the addition of the Matthews Asia Pacific Equity
Income Fund, is incorporated herein by reference to and was filed
electronically with Post-Effective Amendment No. 29 on August 15,
2006.
|
(h)(2)(i)
|
Shareholder
Services Agreement between Matthews International Funds and Matthews
International Capital Management, LLC, dated April 17, 1998 and
as amended
April 3, 2002, is incorporated herein by reference to and was filed
electronically with Post-Effective Amendment No. 18 on July 18,
2003.
|
(h)(2)(ii)
|
Amendment
to Shareholder Services Agreement between Matthews International
Funds and
Matthews International Capital Management, LLC, dated August 15,
2003 is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 20 on December 23, 2003.
|
(h)(2)(iii)
|
Administration
and Shareholder Services Agreement between Matthews International
Funds
and Matthews International Capital Management, LLC, dated August
31, 2004
is incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 22 on October 28, 2004.
|
(h)(2)(iv)
|
Amended
Schedule A to Administration and Shareholder Services Agreement
between
Matthews International Funds and Matthews International Capital
Management, LLC, dated August 12, 2005 to reflect the addition
of the
Matthews India Fund, is incorporated herein by reference to and
was filed
electronically with Post-Effective Amendment No. 27 on October
31,
2005.
|
(h)(2)(v)
|
Amended
Schedule A to Administration and Shareholder Services Agreement
between
Matthews International Funds and Matthews International Capital
Management, LLC, dated, dated August 11, 2006 to reflect the addition
of
the Matthews Asia Pacific Equity Income Fund, is incorporated herein
by
reference to and was filed electronically with Post-Effective Amendment
No. 29 on August 15, 2006.
|
(h)(2)(vi)
|
Amended
Schedule B to Administration and Shareholder Services Agreement
between
Matthews International Funds and Matthews International Capital
Management, LLC dated August 11, 2006 is filed
herewith.
|
(h)(3)
|
Operating
Expenses Agreement between Matthews International Funds and Matthews
International Capital Management, LLC, dated November 14, 2003
is
incorporated herein by reference to and was filed electronically
with
Post-Effective Amendment No. 28 on April 28, 2006.
|
(h)(3)(i)
|
Amendment
to Operating Expenses Agreement Operating Expenses Agreement between
Matthews International Funds and Matthews International Capital
Management, LLC, dated August 12, 2005 to reflect the addition
of the
Matthews India Fund is incorporated herein by reference to and
was filed
electronically with Post-Effective Amendment No. 28 on April 28,
2006.
|
(h)(3)(ii)
|
Amendment
to Operating Expenses Agreement Operating Expenses Agreement between
Matthews International Funds and Matthews International Capital
Management, LLC, dated, dated August 11, 2006 to reflect the addition
of
the Matthews Asia Pacific Equity Income Fund, is incorporated herein
by
reference to and was filed electronically with Post-Effective Amendment
No. 29 on August 15, 2006.
|
(i)
|
Legal
Opinion and Consent of Counsel is filed herewith.
|
(j)
|
Consent
of Independent Registered Public Accounting Firm is filed
herewith.
|
(k)
|
Not
Applicable.
|
(l)
|
Not
Applicable.
|
(m)(1)
|
12b-1
Plan is incorporated herein by reference to and filed electronically
with
Post-Effective Amendment No. 13 on December 20, 1999.
|
(m)(2)
|
Distribution
Plan - Class A dated August 13, 2004 is incorporated herein by
reference
to and was filed electronically with Post-Effective Amendment No.
27 on
October 31, 2005.
|
(n)
|
Not
Applicable.
|
(o)
|
Second
amended and restated 18f-3 Plan is incorporated herein by reference
to and
was filed electronically with Post-Effective Amendment No. 16 on
December
21, 2001.
|
(p)(1)
|
Code
of Ethics of Matthews International Funds is incorporated herein
by
reference to and was filed electronically with Post-Effective Amendment
No. 16 on December 21, 2001.
|
(p)(2)
|
Code
of Ethics of Matthews International Capital Management, LLC is
incorporated herein by reference to and filed electronically with
Post-Effective Amendment No. 14 on October 12, 2000.
|
(p)(3)
|
Code
of Ethics of Matthews Asian Funds and Matthews International Capital
Management, LLC, dated December 15, 2003, is incorporated herein
by
reference to and was filed electronically with Post-Effective Amendment
No. 20 on December 23, 2003.
|
(p)(4)
|
Code
of Ethics of Matthews Asian Funds and Matthews International Capital
Management, LLC, dated October 11, 2004, is incorporated herein
by
reference and was filed electronically with Post-Effective Amendment
No.
23 on December 29, 2004.
|
(p)(5)
|
Code
of Ethics of Matthews Asian Funds and Matthews International Capital
Management, LLC, dated May 2005, is incorporated herein by reference
and
was filed electronically with Post-Effective Amendment No, 26 on
August
10, 2005.
|
(q)(1)
|
Power
of Attorney dated, November 14, 2003, is incorporated herein by
reference
to and was filed electronically with Post-Effective Amendment No.
20 on
December 23, 2003.
|
(q)(2)
|
Power
of Attorney dated, January 27, 2004, is incorporated herein by
reference
to and was filed electronically with Post-Effective Amendment No.
21 on
January 28, 2004.
|
(q)(3)
|
Power
of Attorney dated, August 12, 2005, is incorporated herein by reference
to
and was filed electronically with Post-Effective Amendment No.
27 on
October 31, 2005.
|
Item
24.
|
Persons
Controlled by or under Common Control with the
Registrant
|
|
Not
Applicable.
|
Item
25.
|
Indemnification
|
10.2
Indemnification.
The Trust shall indemnify each of its Trustees against all liabilities
and
expenses (including amounts paid in satisfaction of judgments,
in
compromise, as fines and penalties, and as counsel fees) reasonably
incurred by him in connection with the defense or disposition of
any
action, suit or other proceeding, whether civil or criminal, in
which he
may be involved or with which he may be threatened, while as a
Trustee or
thereafter, by reason of his being or having been such a Trustee
except
with respect to any matter as to which he shall have been adjudicated
to
have acted in bad faith, willful misfeasance, gross negligence
or reckless
disregard of his duties, provided
that as to any matter disposed of by a compromise payment by such
person,
pursuant to a consent decree or otherwise, no indemnification either
for
said payment or for any other expenses shall be provided unless
the Trust
shall have received a written opinion from independent legal counsel
approved by the Trustees to the effect that if either the matter
of
willful misfeasance, gross negligence or reckless disregard of
duty, or
the matter of bad faith had been adjudicated, it would in the opinion
of
such counsel have been adjudicated in favor of such person. The
rights
accruing to any person under these provisions shall not exclude
any other
right to which he may be lawfully entitled, provided
that no person may satisfy any right of indemnity or reimbursement
hereunder except out of the property of the Trust. The Trustees
may make
advance payments in connection with the indemnification under this
Section
10.2, provided
that the indemnified person shall have given a written undertaking
to
reimburse the Trust in the event it is subsequently determined
that he is
not entitled to such
indemnification.
|
The
Trust shall indemnify officers, and shall have the power to indemnify
representatives and employees of the Trust, to the same extent
that
Trustees are entitled to indemnification pursuant to this Section
10.2.
Insofar
as indemnification for liability arising under the Securities Act
of 1933
may be permitted to trustees, officers and controlling persons
of
Registrant pursuant to the foregoing provisions, or otherwise,
Registrant
has been advised that in the opinion of the SEC such indemnification
is
against public policy as expressed in that Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such
liabilities (other than the payment by Registrant of expenses incurred
or
paid by a trustee, officer or controlling person of 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, 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
by it
is against public policy as expressed in that Act and will be governed
by
the final adjudication of such issue.
Section
10.3 of the Registrant’s Trust Instrument, incorporated herein by
reference as Exhibit 1 to Post-Effective Amendment No. 5, also
provides
for the indemnification of shareholders of the Registrant. Section
10.3
states as follows:
10.3
Shareholders.
In case any Shareholder or former Shareholder of any Series shall
be held
to be personally liable solely by reason of his being or having
been a
shareholder of such Series and not because of his acts or omissions
or for
some other reason, the Shareholder or former Shareholder (or his
heirs,
executors, administrators or other legal representatives or, in
the case
of a corporation or other entity, its corporate or other general
successor) shall be entitled out of the assets belonging to the
applicable
Series to be held harmless from and indemnified against all loss
and
expense arising from such liability. The Trust, on behalf of the
affected
Series, shall, upon request by the Shareholder, assume the defense
of any
claim made against the Shareholder for any act or obligation of
the Trust
and satisfy any judgment thereon from the assets of the
Series.
In
addition, Registrant currently has a trustees’ and officers’ liability
policy covering certain types of errors and
omissions.
|
Item
26.
|
Business
and Other Connections of
Advisor:
|
Name
and Position with the Advisor
|
Other
Company
|
Position
With Other Company
|
G.
Paul Matthews
Chairman
and Chief Investment Officer
|
Matthews
International Funds (d/b/a Matthews Asian Funds)
Four
Embarcadero Center
San
Francisco, CA 94111
|
President |
|
Mathews
Asian Selections Funds Plc
Floor
3
Brooklawn
House
Crampton
Ave.
Ballsbridge
Dublin
4, Ireland
|
Director
|
Mark
W. Headley
President,
Chief Executive Officer and Portfolio Manager
|
Matthews
International Funds (d/b/a Matthews Asian Funds)
Four
Embarcadero Center
San
Francisco, CA 94111
|
Vice President |
|
Mathews
Asian Selections Funds Plc
Floor
3
Brooklawn
House
Crampton
Ave.
Ballsbridge
Dublin
4, Ireland
|
Director
|
Robert
L. Schooler
Controller
|
None
|
N/A
|
John
P. McGowan
Chief
Operating Officer
|
Matthews
International Funds (d/b/a Matthews Asian Funds)
Four
Embarcadero Center
San
Francisco, CA 94111
|
Vice President and Secretary |
|
Mathews
Asian Selections Funds Plc
Floor
3
Brooklawn
House
Crampton
Ave.
Ballsbridge
Dublin
4, Ireland
|
Director
|
Andrew
T. Foster
Director
of Research
|
None
|
N/A
|
David
C.R. Harding
Managing
Director, Client Service
and
Marketing
|
None
|
N/A
|
Timothy
B. Parker
General
Counsel
|
None
|
N/A
|
Anna
Schweizer
Member,
Board of Representatives
|
W.R.
Hambrecht + Co
539
Bryant Street
Suite
100
San
Francisco, CA 94107
|
Director,
Strategy and Business Development
|
Vernon
C. Kozlen
Member,
Board of Representatives
|
City
National Corporation City
National
Center
400
North Roxbury Drive
Suite
800
Beverly
Hills, CA 90210
|
Executive
Vice President and Director of Asset Management
Development
|
Item
27.
|
Principal
Underwriter
|
(a)
|
PFPC
Distributors, Inc. (“the Distributor”) is registered with the Securities
and Exchange Commission as a broker-dealer and is a member of the
National
Association of Securities Dealers. As of October 9, 2006, the Distributor
acted as principal underwriter for the following investment
companies:
|
(b)
|
The
Distributor is a Massachusetts corporation located at 301 Bellevue
Parkway, Wilmington, DE 19809. The Distributor is a wholly owned
subsidiary of PFPC, Inc. and an indirect wholly owned subsidiary
of The
PNC Financial Services Group, Inc., a publicly traded
company.
The
following is a list of the directors and executive officers of
the
Distributor:
|
Name
|
Position(s)
with Distributor
|
Brian
Burns
|
Chairman;
Director;
|
President;
Chief Executive Officer
|
|
Michael
Denofrio
|
Director
|
Nicholas
Marsini
|
Director
|
Rita
G. Adler
|
Chief
Compliance Officer
|
John
Munera
|
Anti-Money
Laundering Officer
|
Christine
P. Ritch
|
Chief
Legal Officer;
|
Assistant
Secretary; Assistant Clerk
|
|
Bradley
A. Stearns
|
Secretary;
Clerk
|
Julie
Bartos
|
Assistant
Secretary; Assistant Clerk
|
Amy
Brennan
|
Assistant
Secretary; Assistant Clerk
|
Craig
Stokarski
|
Treasurer;
Chief Financial Officer;
|
Financial
& Operations Principal
|
|
Maria
Schaffer
|
Assistant
Treasurer; Controller
|
Bruno
Di Stefano
|
Vice
President
|
Susan
K. Moscaritolo
|
Vice
President
|
(c)
|
Not
applicable.
|
Item
28.
|
Location
of Accounts and Records
|
Books
or other documents required to be maintained by Section 31(a) of
the
Investment Company Act of 1940, and the rules promulgated thereunder,
are
maintained as follows:
|
|
(a)
|
With
respect to Rules 31a-1(a); 31a-1(b)(1); (2)(a) and (b); (3); (6);
(8);
(12); and 31a-1(d), the required books and records will be maintained
at
the offices of Registrant’s Custodian:
|
The
Bank of New York, One Wall Street, New York, N.Y. 10286
|
|
(b)/(c)
|
With
respect to Rules 31a-1(a); 31a-1(b),(4); (2)(C) and (D); (4); and
31a-1(f), the required books and records are maintained at the
offices of
Registrant’s Administrator, Transfer Agent and Fund Accounting Services
Agent:
|
PFPC
Inc., 760 Moore Road, King of Prussia, 19406-0903.
|
|
(c)
|
With
respect to Rules 31a-1(b)(5), (6), (9), (10) and (11) and 31a-1(f),
the
required books and records are maintained at the principal offices
of the
Registrant’s Advisor:
|
Matthews
International Capital Management, LLC, Four Embarcadero Center,
Suite 550,
San Francisco, CA 94111
|
|
Item
29.
|
Management
Services
|
|
Not
Applicable.
|
Item
30.
|
Undertakings
|
Not
Applicable.
|
Signature
|
Capacity
|
Date
|
||
/s/
G. Paul Matthews
|
President
and Principal Executive Officer
|
October
31, 2006
|
||
G.
Paul Matthews
|
||||
/s/
Shai Malka
|
Treasurer
|
October
31, 2006
|
||
Shai
Malka
|
||||
/s/
Geoffrey H. Bobroff*
|
Trustee
|
October
31, 2006
|
||
Geoffrey
H. Bobroff
|
||||
/s/
Robert K. Connolly*
|
Trustee
|
October
31, 2006
|
||
Robert
K. Connolly
|
||||
/s/
Richard K. Lyons*
|
Trustee
|
October
31, 2006
|
||
Richard
K. Lyons
|
||||
/s/
David FitzWilliam-Lay*
|
Trustee
|
October
31, 2006
|
||
David
FitzWilliam-Lay
|
||||
/s/
Rhoda Rossman*
|
Trustee
|
October
31, 2006
|
||
Rhoda
Rossman
|
||||
/s/
Toshi Shibano*
|
Trustee
|
October
31, 2006
|
||
Toshi
Shibano
|
EXHIBIT
NO.
|
DESCRIPTION
|
|
(h)(2)(vi)
|
Amended
Schedule B to Administration and Shareholder Services Agreement
between
Matthews International Funds and Matthews International Capital
Management, LLC dated August 11, 2006
|
|
(i)
|
Legal
Opinion and Consent of Counsel
|
|
(j)
|
Consent
of Independent Registered Public Accounting Firm
|
|