Qualified Dividend Income Percentage

All or a portion of your ordinary income dividend from a mutual fund may be taxed at a rate of 15% (0% for investors in the 15% or 10% tax bracket) rather than the higher marginal rates applicable to ordinary income. The amount of your dividend subject to this lower rate is reported in Box 1b of your Form 1099-DIV mailed in January 2010. The tax forms for the T. Rowe Price Real Estate, Global Real Estate, and Small-Cap Value Funds will mail in February.

The tables below report the percentage of the ordinary dividend paid by the T. Rowe Price funds that qualify for the lower dividend rate. The data is provided here for informational purposes only and to assist you in your tax planning. In preparing your tax return, please use the amount in Box 1b of your Form 1099-DIV.

To treat a dividend as qualifying for lower rates, you must have held your shares on which you received the dividend for at least 61 days during the 121-day period beginning 60 days before the ex-dividend date of the distribution. You may find your fund’s ex-dividend date here.

In addition, the ordinary dividend of a mutual fund (the amount included in Box 1a of Form 1099-DIV) includes net short-term capital gains and foreign taxes paid, which may not qualify for the lower rates. As a result, the percentage of the Box 1a amount that qualifies for the lower tax rate can vary widely from year to year, depending on the amount of short-term gains and foreign taxes reported by the fund.

If you own a fund that has more than one distribution during the year, the amount reported in Box 1b of your Form 1099-DIV will be based on the qualifying percentage for each distribution.

Calculations based on the percentages below may yield amounts that differ from the amounts on your Form 1099-DIV due to rounding.

• Domestic Stock Funds
• International Stock Funds
• Taxable Bond Funds
• Retirement and Spectrum Funds
• Institutional Funds
• Variable Annuity Portfolios

¹This percentage applies to the sum of your ordinary dividend paid for the calendar year or other period, if indicated, as reported in Box 1a of your IRS Form 1099-DIV.

²Percentage only applies to the $0.03 taxable income dividend paid in August 2009. The fund merged into Balanced Fund on August 31, 2009.

³Formerly Tax-Efficient Multi-Cap Growth Fund.

⁴Percentage only applies to the $0.011 dividend paid in August 2009. The fund merged into Tax-Efficient Equity Fund on August 31, 2009.

Percentages are the same for all fund classes (Investor, Advisor, R, and II)

N/A indicates that a fund did not pay an ordinary dividend in 2009.

A dash indicates that the fund paid an ordinary dividend in 2009, but it was not qualified dividend income.