Rule 497(e)
File Nos. 33-78960 and 811-8510
MATTHEWS INTERNATIONAL FUNDS
AMENDMENT DATED APRIL 18, 2002
TO THE PROSPECTUS AND STATEMENT OF ADDITIONAL INFORMATION
DATED DECEMBER 28, 2001 AS REVISED JANUARY 10, 2002
Effective March 1, 2002, each Fund, pursuant to a Shareholder Services
Agreement, will pay a shareholder service fee at an annual rate of up to 0.15%
of that Fund's average daily net assets. The fee is intended to reimburse
Matthews International Capital Management LLC, the investment adviser to the
Funds, for providing or arranging for services to shareholders of the Funds.
Additionally, the annual expense limitation for the Matthews Korea Fund will be
reduced from 2.50% to 2.00%. Accordingly, please note the changes below to the
relevant pages of the Prospectus and Statement of Additional Information of the
Funds.
The following table replaces the table that appears under the caption "Fees and
Expenses" on page 14 of the Prospectus:
OTHER EXPENSES
(INCLUDING TOTAL
DISTRIBUTION/ MAXIMUM 0.15% ANNUAL FEE REDUCTION NET EXPENSES
MANAGEMENT RULE 12b-1 SHAREHOLDER OPERATING AND/OR EXPENSE AFTER
MATTHEWS FUND FEES FEES SERVICE FEE) EXPENSES REIMBURSEMENT REIMBURSEMENT
------------- ---- ---- ------------ -------- ------------- -------------
Pacific Tiger 1.00% None 1.05% 2.05% 0.15% 1.90%
Asian Growth and Income 1.00% None 1.05% 2.05% 0.15% 1.90%
Korea 1.00% None 0.93% 1.93% None 1.93%
China 1.00% None 1.15% 2.15% 0.15% 2.00%
Japan 1.00% None 1.23% 2.23% 0.23% 2.00%
Asian Technology 1.00% None 1.84% 2.84% 0.84% 2.00%
The following table replaces the table that appears under the caption "Example"
on page 14 of the Prospectus:
NAME OF FUND 1 YEAR 5 YEARS 5 YEARS 10 YEARS
------------ ------ ------- ------- --------
Pacific Tiger $193 $611 $1,072 $2,138
Asian Growth and Income $193 $611 $1,072 $2,138
Korea $195 $605 $1,039 $2,082
China $203 $642 $1,123 $2,206
Japan $203 $650 $1,148 $2,246
Asian Technology $203 $715 $1,341 $2,550
The following paragraph should be added before the last paragraph on page 19 of
the Prospectus:
SHAREHOLDER SERVICES AGREEMENT
Each Fund, pursuant to a Shareholder Services Agreement with the Advisor, will
pay the Advisor a shareholder service fee at an annual rate of up to 0.15% of
that Fund's average daily net assets. The fee is intended to reimburse the
Advisor for providing or arranging for services to shareholders of the Funds.
The following paragraphs should be added to the last full paragraph in the first
column of page 29 of the Statement of Additional Information:
SHAREHOLDER SERVICES AGREEMENT
The Trust entered into a Shareholder Services Agreement with Matthews
International Capital Management LLC, the investment adviser to the Funds, on
April 17, 1998 (the "Services Agreement"). The Advisor (or its affiliate) serves
as the service provider under the Services Agreement and, as such, receives any
fees paid by the Funds pursuant to the Services Agreement. On April 3, 2002, the
Board of Trustees of the Trust, including a majority of the Trustees who are not
interested persons of the Trust and who have no direct or indirect financial
interest in the operation of the Services Agreement or in any agreement related
to the Services Agreement, at a special meeting, voted to implement the
provisions of the Services Agreement with respect to each Fund, effective March
1, 2002.
Under the Services Agreement, each Fund will pay a continuing service fee to the
Advisor or other service providers, in an amount, computed and prorated on a
daily basis, equal to 0.15% per annum of the average daily net assets of each
Fund. Such amounts are compensation for providing certain services to
shareholders owning shares of the Funds, including personal services such as
processing purchase and redemption transactions, assisting in change of address
requests and similar administrative details, and providing other information and
assistance with respect to a Fund, including responding to shareholder
inquiries.