On September 16, 2003, a purported  class action  (Woodbury v. T. Rowe Price
International  Funds,  Inc.) was filed in the  Circuit  Court,  Third  Judicial
Circuit,  Madison  County,  Illinois,  against  T. Rowe  Price International,
Inc.  and the T. Rowe Price  International  Funds,  Inc. Two  unrelated  fund
groups were also named as defendants.  The basic  allegation in the complaint
is that the T. Rowe Price  defendants do not make appropriate value adjustments
to the foreign  securities of the T. Rowe Price  International  Stock Fund
prior to calculating  the Fund's daily share prices,  thereby  benefiting
market timing  traders at the expense of long-term  shareholders. At this time,
the court has ordered a stay in this matter,  pending  movement in the Federal
Judicial Panel on Multidistrict  Litigation  ("MDL") overseeing various mutual
fund litigation matters filed in Federal Court.

In the view of the T. Rowe  Price  funds and T. Rowe Price  International,
the  allegations  set forth in the complaint are factually and legally
inaccurate and wholly without merit.  T. Rowe Price will defend this case
vigorously.