SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by Registrant [X]
Filed by Party other than the Registrant
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to §240.14a-12
JF China Region Fund, Inc.
(Name of Registrant as Specified in Its Charter)
_______________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11
(1)
Title of each class of securities to which transaction applies: ___________________________
(2)
Aggregate number of securities to which transaction applies: ____________________________
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11. (Set forth the amount on which the filing fee is calculated and state how it was determined):_______________
(4)
Proposed maximum aggregate value of transaction:_________________________________________
(5)
Total fee paid:_______________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
(1)
Amount previously paid:______________________________________________________________
(2)
Form, Schedule or Registration Statement No.:_____________________________________________
(3)
Filing Party: ________________________________________________________________________
(4)
Date Filed: _________________________________________________________________________
1 Beacon Street, 18th Floor
Boston, Massachusetts 02108, USA
Chairman
1 Beacon Street, 18th Floor
Boston, Massachusetts 02108 USA
TO BE HELD ON MAY 10, 2012
(1) | to elect two Directors of the Fund, to hold office for the term indicated and until their successors shall have been elected and qualified; |
(2) | to approve an amendment to the Fund’s Investment Advisory and Management Agreement to provide that fees paid under the agreement to the Investment Advisor will be based on all managed assets; and |
(3) | to consider and act upon such other business as may properly come before the Meeting or any adjournments or postponements thereof. |
Secretary
April 13, 2012
Whether or not you plan to attend the Fund’s Annual Meeting,
please execute and return the enclosed proxy promptly in the postage-paid envelope provided.
THE SHAREHOLDER MEETING TO BE HELD ON MAY 10, 2012
atwww.jfchinaregion.com/proxystatement.pdf
1 Beacon Street, 18th Floor
Boston, Massachusetts 02108 USA
(1) | to elect two Directors of the Fund, to hold office for the term indicated and until their successors shall have been elected and qualified; |
(2) | to approve an amendment to the Fund’s Investment Advisory and Management Agreement to provide that fees paid under the agreement to the Investment Advisor will be based on all managed assets; and |
(3) | to consider and act upon such other business as may properly come before the Meeting or any adjournments or postponements thereof. |
P.O. Box 43010
Providence, Rhode Island 02940-3010, USA
800-426-5523
www.computershare.com
effect on Proposal 1, but will have an effect of a vote against Proposal 2. The presence at the Meeting, in person or by proxy, of the stockholders entitled to cast a majority of all the votes entitled to be cast at the Meeting shall be necessary and sufficient to constitute a quorum for the transaction of business. Approval of Proposal 1 will require the affirmative vote of a majority of the shares of common stock present in person or by proxy at the Meeting and entitled to vote thereon. Approval of Proposal 2 will require the affirmative vote of “a majority of the outstanding voting securities” as defined by the Investment Company Act of 1940, as amended (the “1940 Act”). The term “majority of the outstanding voting securities,” as defined by the 1940 Act and as used in this Proxy Statement, means: the affirmative vote of the lesser of (1) 67% or more of the voting securities of the Fund present at the meeting, if the holders of more than 50% of the Fund’s outstanding voting securities are present or represented by proxy, or (2) more than 50% of the Fund’s outstanding voting securities.
Title of Class | | Name and Address | | Number of Shares | | Percent of Class1 | ||||||||
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Common Stock | CEDE & Co. c/o Depository Trust Company Box 20 New York, New York 10004-9998 | 6,395,648 | 99.09% | |||||||||||
Common Stock | City of London Investment Group PLC2 77 Gracechurch Street London, EC3V 0AS England | 2,315,320 | 35.90% | |||||||||||
Common Stock | Lazard Asset Management LLC3 30 Rockefeller Plaza 59th Floor New York, New York 10112 | 1,023,257 | 15.87% |
1 | Because some or all of the shares attributed to CEDE & Co. may be held through the Depository Trust Company by City of London Investment Group PLC and/or Lazard Asset Management LLC, the total percentage in this column may exceed 100%. |
2 | Information as to beneficial ownership of City of London Investment Group PLC is based on a report filed with the Securities and Exchange Commission (the “SEC”) on February 7, 2012. |
3 | Information as to beneficial ownership of Lazard Asset Management LLC is based on a report filed with the SEC on February 8, 2012. |
Title of Class | | Name and Address | | Number of Shares | | Percent of Class* | ||||||||
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Common Stock | The Rt. Hon. The Earl of Cromer (Nominee) Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | 7,106 | 0.11% | |||||||||||
Alexander R. Hamilton P.O. Box 12343 General Post Office Hong Kong | 651 | 0.01% | ||||||||||||
Julian M.I. Reid Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | 632 | 0.01% | ||||||||||||
John R. Rettberg 1 Beacon Street 18th Floor Boston MA, 02108 USA | 500 | 0.01% | ||||||||||||
Simon J. Crinage (Nominee) Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | —— | —— | ||||||||||||
Michael J. James 21st Floor, Chater House 8 Connaught Road Central Hong Kong | —— | —— | ||||||||||||
Christopher D. Legg Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | —— | —— | ||||||||||||
Muriel Y.K. Sung 21st Floor, Chater House 8 Connaught Road Central Hong Kong | —— | —— | ||||||||||||
All Directors and Officers as a Group* |
* | The holdings of each director and officer, and the nominee and the holdings of all directors and officers, and the nominee as a group does not exceed 1% of the Fund’s outstanding common stock. The holdings of each director and officer of shares of the Investment Advisor and its affiliates do not exceed 1% of the value of the Investment Advisor or its affiliates. |
ELECTION OF DIRECTORS
Name, Address and DOB | Position(s) Held with Fund | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of Funds in Fund Complex Overseen by Director* | Other Directorships Held by Director During the Past Five Years | ||||||||||||||||||
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INDEPENDENT DIRECTORS OR NOMINEE | |||||||||||||||||||||||
The Rt. Hon. The Earl of Cromer (Nominee) (June 3, 1946) Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | Chairman and Class I Director | Three year term ends in 2012; Chairman and Director since 1994 | Chairman of the Board of the Fund; Chairman of the Board, Western Provident Association (insurance), LG India Plus Fund Ltd (financial); Pedder Street Asia Absolute Return Fund Limited (financial); LG Asia Plus Fund Limited (financial); Director, Cheetah Korea Fund Ltd (financial) and Chief Executive Officer, Cromer Associates Limited (family business). | 1 | See Principal Occupation | ||||||||||||||||||
Alexander R. Hamilton (October 4, 1941) 21st Floor, 8 Connaught Road Central, Hong Kong | Class II Director | Three year term ends in 2013; Director since 1994 | Director of Citic Pacific Limited (infrastructure), Cosco International Holdings Limited (shipping); Esprit Holdings Limited (clothing retail), Shangri-La Asia Limited (hotels) and Octopus Cards Limited (financial services). Former Director of China Cosco Holdings Co. Limited (shipping) (retired May 2011). | 1 | See Principal Occupation | ||||||||||||||||||
John R. Rettberg (September 1, 1937) 1 Beacon Street 18th Floor Boston MA, 02108 USA | Class II Director | Three year term ends in 2013; Director since 2008 | Former Trustee, JPMorgan Alternative Products mutual fund Board 1997 to 2009. | 1 | See Principal Occupation |
Name, Address and DOB | Position(s) Held with Fund | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of Funds in Fund Complex Overseen by Director* | Other Directorships Held by Director During the Past Five Years | ||||||||||||||||||
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Julian M.I. Reid (August 7, 1944) Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | Class III Director | Three year term ends 2014; Director since 1998 | Chief Executive Officer of 3a Funds Group (financial); Director and Chairman of Morgan’s Walk Properties Limited (property), Director and Chairman of The Korea Fund, Inc. (financial); Director and Chairman of Prosperity Voskhod Fund (financial); Director and Chairman of ASA Limited (financial) and Director of 3a Global Growth Fund Limited (financial). | 1 | See Principal Occupation | ||||||||||||||||||
INTERESTED DIRECTOR AND NOMINEE | |||||||||||||||||||||||
Simon J. Crinage (Nominee) (May 10, 1965) Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | President and Class I Director | Three year term ends in 2012; Director since 2009; President since 2003** | Managing Director, J.P. Morgan Asset Management 2008 to present; Vice President, J.P. Morgan Asset Management 2000 to 2008. | 1 | None | ||||||||||||||||||
OFFICERS WHO ARE NOT DIRECTORS | |||||||||||||||||||||||
Michael J. James (May 11, 1967) 21st Floor, 8 Connaught Road Central, Hong Kong | Treasurer | Since 2006** | Vice President, J.P. Morgan Asset Management since September 2000. | N/A | N/A | ||||||||||||||||||
Christopher D. Legg (March 12, 1982) Finsbury Dials 20 Finsbury Street London EC2Y 9AQ United Kingdom | Secretary | Since 2008** | Associate, J.P. Morgan Asset Management since 2008. | N/A | N/A | ||||||||||||||||||
Muriel Y.K. Sung (September 25, 1966) 21st Floor, 8 Connaught Road Central, Hong Kong | Chief Compliance Officer | Since 2004** | Managing Director, J.P. Morgan Asset Management since January 2010; Vice President, J.P. Morgan Asset Management 2004 to 2010. | N/A | N/A |
* | JF China Region Fund, Inc. is the sole fund in the fund complex. |
** | The officers of the Fund serve at the discretion of the Board. |
Name of Director | | Dollar Range of Equity Securities in the Fund1 | ||||
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INDEPENDENT DIRECTORS2 | ||||||
The Rt. Hon. The Earl of Cromer | $50,001 – 100,000 | |||||
Alexander R. Hamilton | $1 – 10,000 | |||||
Julian M.I. Reid | $1 – 10,000 | |||||
John R. Rettberg | $1 – 10,000 | |||||
INTERESTED director3 | ||||||
Simon J. Crinage | None |
1 | Valuation as of March 16, 2012. |
2 | “Independent Directors” is defined as those directors who are not “interested persons” within the meaning of Section 2(a)(19) of the “1940 Act”. |
3 | “Interested” is defined within the meaning of Section 2(a)(19) of the 1940 Act. |
Name of Person, Position | | Aggregate Compensation From Fund | | Pension or Retirement Benefits Accrued as Part of Fund Expenses* | | Estimated Annual Benefits Upon Retirement* | | Total Compensation From Fund and Fund Complex Paid to Directors | ||||||||||
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INDEPENDENT DIRECTORS | ||||||||||||||||||
The Rt. Hon. The Earl of Cromer, Chairman and Director | $ | 56,000 | None | None | $ | 56,000 | ||||||||||||
Alexander R. Hamilton, Director | 50,000 | None | None | 50,000 | ||||||||||||||
Julian M.I. Reid, Director | 46,000 | None | None | 46,000 | ||||||||||||||
John R. Rettberg, Director | 46,000 | None | None | 46,000 | ||||||||||||||
INTERESTED DIRECTOR | ||||||||||||||||||
Simon J. Crinage | Nil | None | None | Nil | ||||||||||||||
Total | 198,000 | None | None | 198,000 |
* | The Directors of the Fund do not receive any pension or retirement benefits from the Fund or the Fund’s Investment Advisor. |
MANAGEMENT AGREEMENT (“INVESTMENT ADVISORY AGREEMENT”)
TO PROVIDE THAT FEES PAID THEREUNDER WILL BE BASED
ON MANAGED ASSETS
The Fund agrees to pay in United States dollars to JFIMI, as full compensation for the services to be rendered and expenses to be borne by JFIMI hereunder, an annual fee equal to 1.00% of the value of the weekly net assets of the Fund, accruing weekly and payable monthly. For purposes of computing the fee, the weekly net assets of the Fund shall be determined as of the close of business in Hong Kong on the last business day of each week or on such other day as the directors of the Fund may determine, and shall be deemed to be the weekly net assets for the period from the day first following the day such weekly net assets were last computed, up to and including the day of such computation. |
The Fund agrees to pay in United States dollars to JFIMI, as full compensation for the services to be rendered and expenses to be borne by JFIMI hereunder, an annual fee equal to 1.00% of the value of the weekly Managed Assets (as hereinafter defined) of the Fund, accruing weekly and payable monthly. For purposes of computing the fee, the weekly Managed Assets of the Fund shall be determined as of the close of business in Hong Kong |
on the last business day of each week or on such other day as the directors of the Fund may determine, and shall be deemed to be the weekly Managed Assets for the period from the day first following the day such weekly Managed Assets were last computed, up to and including the day of such computation. As used in this Agreement, “Managed Assets” shall mean net assets plus the amount of any borrowings for investment purposes. Upon the commencement of the use of borrowings for investment purposes, the Investment Advisor will accrue fees based on Managed Assets. The Investment Advisor may charge such fees to the Fund only upon stockholder approval. |
(2) | Review of the Fund’s Audited Financial Statements for the year ended December 31, 2011 |
Alexander R. Hamilton, Chairman
The Rt. Hon. The Earl of Cromer
Julian M.I. Reid
John R. Rettberg
Fiscal Year Ended December 31 | Audit Fees | Audit-Related Fees* | Tax Fees | All Other Fees | ||||||||||||||
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2010 | $56,500 | —— | $5,940 | —— | ||||||||||||||
2011 | $58,500 | —— | $6,100 | —— |
* | “Audit-Related Fees” are those fees billed to the Fund by PwC in connection with services reasonably related to the performance of the audit of the Fund’s financial statements. |
• | The annual investment advisory fee rate paid by the Fund to JFIMI for investment advisory services was reasonable relative to the Fund’s peer group and relative to other non-U.S. funds managed by JFIMI. |
• | The Committee and the Board were generally satisfied with the nature, quality and extent of other services provided by JFIMI. In reaching this conclusion, the Committee and the Board reviewed, among other things, JFIMI’s investment experience in the China region markets and the background and experience of JFIMI’s senior management. |
• | The Fund’s performance during the one-year and three-year periods lagged the Fund’s peer group and the Fund’s benchmark, the MSCI Golden Dragon Index. (The Board and the Committee reviewed the Fund’s performance in comparison to the peer group and the benchmark for the 1 year, 3 year, 5 year and since inception periods.) Although one-year, three-year and five-year performance lagged, it was noted that for certain longer-term periods, the Fund’s performance surpassed the benchmark. The Board and Committee noted that the Investment Advisor had made satisfactory progression implementing a strategic repositioning of the portfolio with the Board and Committee’s full support. The strategic repositioning included proposals to increase the Fund’s China A-Share exposure to approximately $20 million, although the timing of this investment was uncertain and subject to necessary regulatory approval. |
• | In light of the costs of providing advisory services to the Fund, the profits and ancillary benefits that JFIMI received, with respect to providing investment advisory services to the Fund, were reasonable. The Board and the Committee noted that beginning in May 2005, the Fund discontinued using JFIMI’s affiliates to affect Fund securities trades, unless in exceptional circumstances, effectively eliminating brokerage commissions as an ancillary benefit for JFIMI. |
• | The Fund’s expense ratio remained at an acceptable level. |
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Using ablack inkpen, mark your votes with anXas shown in | X |
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Annual Meeting Proxy Card |
![(LOGO)](https://capedge.com/proxy/PRE 14A/0001174947-12-000124/img007.jpg)
![(LOGO)](https://capedge.com/proxy/PRE 14A/0001174947-12-000124/img007.jpg)
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| A | Proposals — The Board of Directors recommends a vote FOR the nominees listed in Proposal 1 and FOR Proposal 2. |
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| 1. Nominee: | For |
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| 01 - The Rt. Hon The Earl of Cromer | o |
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| 02 - Simon J. Crinage | o |
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| 2. Amendment to the Fund’s Investment Advisory and Management Agreement | o |
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| B | Non-Voting Items |
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Change of Address— Please print new address below. |
| Comments— Please print your comments below. |
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| C | Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below |
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| Date (mm/dd/yyyy) — Please print date below. |
| Signature 1 — Please keep signature within the box. |
| Signature 2 — Please keep signature within the box. |
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| 1 1 B V | 1 1 3 9 8 4 1 |
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01AXYE
Dear Stockholder,
Please take note of the important information enclosed with this Proxy Ballot. Your vote counts, and you are strongly encouraged to exercise your right to vote your shares.
Please mark the box on this proxy card to indicate how your shares will be voted. Then sign and date, and return your proxy vote in the enclosed postage paid envelope. Your vote must be received prior to the Annual Meeting of Stockholders, May 10, 2012.
Thank you in advance for your prompt consideration of this matter.
Sincerely,
JF China Region Fund, Inc.
![(LOGO)](https://capedge.com/proxy/PRE 14A/0001174947-12-000124/img007.jpg)
![(LOGO)](https://capedge.com/proxy/PRE 14A/0001174947-12-000124/img007.jpg)
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Proxy — JF China Region Fund, Inc. |
Proxy Solicited on Behalf of the Board of Directors
THE UNDERSIGNED STOCKHOLDER of JF China Region Fund, Inc. (the “Fund”) hereby appoints Charles J. Daly and Benjamin T. Doherty the lawful attorneys and proxies of the undersigned with full power of substitution to vote, as designated below, all shares of Common Stock of the Fund which the undersigned is entitled to vote at the Annual Meeting of Stockholders to be held on Thursday, May 10, 2012, at 11:00 a.m., at the offices of J.P. Morgan Asset Management, 270 Park Avenue, New York, NY 10017, and at any and all adjournments thereof with respect to the matters set forth below and described in the Notice of Annual Meeting and Proxy Statement dated April [___], 2012, receipt of which is hereby acknowledged, and any other matters arising before such Annual Meeting or any adjournment thereof.
Properly executed proxies will be voted (or the vote on such matters will be withheld on specific matters) in accordance with instructions appearing on the proxy. In the absence of specific instructions, proxies will be voted FOR the election of the nominees as directors and will be voted FOR the amendment to the Fund’s Investment Advisory and Management Agreement. Please refer to the Proxy Statement for a discussion of the proposal.
PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.