ADMINISTRATION AGREEMENT
THIS AGREEMENT is made this 17TH day of October 2007 and is effective
as of the 1ST day of October 2007, by and between The Japan Fund, Inc., a
Maryland corporation (the "Fund"), and SEI Investments Global Funds Services
(the "Administrator"), a Delaware business trust.
WHEREAS, the Fund is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Administrator and Fund entered into an Administration
Agreement, dated as of June 28, 2002 (the "ADMINISTRATION AGREEMENT"), pursuant
to which the Administrator agreed to provide certain administration and
accounting services on behalf of the Funds;
WHEREAS, pursuant to Article 6 of the Administration Agreement, the
Fund provided notice to the Administrator that it desired to terminate the
Administration Agreement as of 12:01 a.m. E.S.T, October 1, 2007;
WHEREAS, the Fund's fiscal year-end is September 30, 2007 and the
parties desire to enter into a limited administration agreement for a period of
time in order to help the Fund meet certain of its regulatory and tax reporting
obligations, as well as to ensure the smooth transition of administrative and
accounting services to the new service providers including the delivery of all
the Fund's books and records to the new service providers; and
WHEREAS, the Fund desires the Administrator to provide, and the
Administrator is willing to provide, limited administrative services to the Fund
as the Fund and the Administrator agree upon on the terms and conditions
hereinafter set forth herein;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Fund and the Administrator hereby agree as follows:
ARTICLE 1. RETENTION OF THE ADMINISTRATOR. The Fund hereby retains the
Administrator to provide the Fund with administrative services as set forth in
this Agreement, and the Administrator hereby accepts such employment. The
Administrator shall be deemed to be an independent contractor for all purposes
herein.
ARTICLE 2. ADMINISTRATIVE AND SERVICES. The Administrator shall perform
or supervise the performance by others of the services set forth in Schedule A
hereto. The Administrator shall provide the Fund with all necessary office
space, equipment, personnel, compensation and facilities for providing such
services. The Administrator may sub-contract with third parties to perform
certain of the services to be performed by the Administrator hereunder;
provided, however, that the Administrator shall remain principally responsible
to the Fund for the acts and omissions of such other entities. In meeting its
duties hereunder, the Administrator shall have the general authority to do all
acts deemed in the Administrator's good faith belief to be necessary and proper
to perform its obligations under this Agreement. The Administrator shall provide
assistance and reasonable cooperation to the Fund, its successor administrator
and other service providers. Nothing herein shall require the Administrator to
divulge any of its proprietary information or to provide the Fund's books and
records in a format that infringes upon the Administrator's proprietary
information. Such proprietary information may include the certain formats in
which such Fund data may exist, such as those indicated in Article 11.
ARTICLE 3. ALLOCATION OF CHARGES AND EXPENSES.
(A) THE ADMINISTRATOR. The Administrator shall furnish at its own
expense the executive, supervisory and clerical personnel necessary to perform
its obligations under this Agreement. The Administrator shall also pay at its
own expense all compensation, if any, of officers of the Fund as well as all
Directors of the Fund who are affiliated persons of the Administrator or any
affiliated corporation of the Administrator; provided, however, that unless
otherwise specifically provided, the Administrator shall not be obligated to pay
at its own expense the compensation of any employee of the Fund retained by the
Directors of the Fund to perform services on behalf of the Fund.
(B) FUND EXPENSES. The Fund assumes and shall pay or cause to be paid
all other expenses of the Fund not otherwise allocated in this Agreement,
including, without limitation, organizational costs, taxes, expenses for legal
and auditing services, the expenses of preparing (including typesetting),
printing and mailing reports, prospectuses, statements of additional
information, proxy solicitation material and notices to existing shareholders,
all expenses incurred in connection with issuing and redeeming Shares, the costs
of pricing services, the costs of custodial services, the cost of initial and
ongoing registration of the Shares under federal and state securities laws, fees
and out-of-pocket expenses of Directors who are not affiliated persons of the
Administrator or any affiliated corporation of the Administrator, the costs of
Directors' meetings, insurance, interest, brokerage costs, litigation and other
extraordinary or nonrecurring expenses, and all fees and charges of service
providers to the Fund. The Fund shall reimburse the Administrator for all
reasonable SAS 70 audit charges. Subject to the approval of the Board of
Directors or its designee, the Fund shall also reimburse the Administrator for
its reasonable out of pocket expenses, including copying, postage, telephone,
and fax charges, which are not incurred in the ordinary course of business.
ARTICLE 4. COMPENSATION OF THE ADMINISTRATOR. The Fund shall pay to the
Administrator compensation at the rate specified in Schedule B to this
Agreement. Such compensation shall be paid to the Administrator in advance of
the performance of the services required to be performed by the Administrator
hereunder.
ARTICLE 5. LIMITATION OF LIABILITY OF THE ADMINISTRATOR. The duties of
the Administrator shall be confined to those expressly set forth herein, and no
implied duties are assumed by or may be asserted against the Administrator
hereunder. The Administrator shall not be liable for any error of judgment or
mistake of law or for any loss arising out of any investment or for any actor or
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omission in carrying out its duties hereunder, except a loss resulting from
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or by reason of reckless disregard of its obligations and duties
hereunder. (As used in this Article 5, the term "Administrator" shall include
Directors, officers, employees and other agents of the Administrator as well as
that entity itself.) Under no circumstances shall the Administrator be liable to
the Fund for consequential, indirect or punitive damages.
So long as the Administrator, or its agents, acts without willful
misfeasance, bad faith or gross negligence in the performance of its duties, and
without reckless disregard of its obligations and duties hereunder, the Fund
assumes full responsibility and shall indemnify the Administrator otherwise, and
from and against any and all losses, damages, costs, charges, reasonable counsel
fees and disbursements, payments, expenses and liabilities (including reasonable
investigation expenses) arising directly or indirectly out of any act or
omission of Administrator in carrying out its duties hereunder. The indemnity
and defense provisions set forth herein shall indefinitely survive the
termination of this Agreement.
The indemnification rights hereunder shall include the right to
reasonable advances of defense expenses in the event of any pending or
threatened litigation with respect to which indemnification hereunder may
ultimately be merited. If in any case the Fund may be asked to indemnify or hold
the Administrator harmless, the Administrator shall promptly advise the Fund of
the pertinent facts concerning the situation in question, and the Administrator
will use all reasonable care to identify and notify the Fund promptly concerning
any situation which presents or appears likely to present the probability of
such a claim for indemnification, but failure to do so shall not affect the
rights hereunder.
The Fund shall be entitled to participate at its own expense or, if it
so elects, to assume the defense of any suit brought to enforce any claims
subject to this indemnity provision. If the Fund elects to assume the defense of
any such claim, the defense shall be conducted by counsel chosen by the Fund and
satisfactory to the Administrator, whose approval shall not be unreasonably
withheld. In the event that the Fund elects to assume the defense of any suit
and retain counsel, the Administrator shall bear the fees and expenses of any
additional counsel retained by it. If the Fund does not elect to assume the
defense of a suit, it will reimburse the Administrator for the fees and expenses
of any counsel retained by the Administrator.
The Administrator may apply to the Fund at any time for instructions
and may consult counsel for the Fund or its own counsel and with accountants and
other experts with respect to any matter arising in connection with the
Administrator's duties, and the Administrator shall not be liable or accountable
for any action taken or omitted by it in good faith in accordance with such
instruction or with the opinion of such counsel, accountants or other experts.
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Also, the Administrator shall be protected in acting upon any document
which it reasonably believes to be genuine and to have been signed or presented
by the proper person or persons. Nor shall the Administrator be held to have
notice of any change of authority of any officers, employee or agent of the Fund
until receipt of written notice thereof from the Fund.
Nothing herein shall make Administrator liable for the performance or
omissions of unaffiliated third parties not under Administrator's reasonable
control such as, by way of example and not limitation, transfer agents,
custodians, investment advisers or sub-advisers, postal or delivery services,
telecommunications providers and processing and settlement services.
ARTICLE 6. DURATION AND TERMINATION OF THIS AGREEMENT. This Agreement
shall remain in effect until December 31, 2007.
ARTICLE 7. ACTIVITIES OF THE ADMINISTRATOR. The services of the
Administrator rendered to the Fund are not to be deemed to be exclusive. The
Administrator is free to render such services to others and to have other
businesses and interests.
ARTICLE 8. CONFIDENTIALITY. The Administrator agrees on behalf of
itself and its employees to treat confidentially all records and other
information relative to the Fund and its shareholders received by the
Administrator in connection with this Agreement, including any non-public
personal information as defined in Regulation S-P, and that it shall not use or
disclose any such information except for the purpose of carrying out the terms
of this Agreement; provided, however, that Administrator may disclose such
information as required by law or after prior notification to and approval in
writing by the Fund, which approval may not be withheld where the Administrator
may be exposed to civil or criminal contempt proceedings or penalties for
failure to comply.
ARTICLE 9. CERTAIN BOOKS AND RECORDS. The Administrator shall maintain
customary records in connection with its duties as specified in this Agreement.
Any records required to be maintained and preserved pursuant to Rules 31a-1 and
31a-2 under the 1940 Act which are prepared or maintained by the Administrator
on behalf of the Fund shall be prepared and maintained at the expense of the
Administrator, but shall be property of the Fund and will be made available to
or surrendered promptly to the Fund on request.
In case of any request or demand for the inspection of such records by
another party, the Administrator shall notify the Fund and follow the Fund's
instructions as to permitting or refusing such inspection; provided that the
Administrator may exhibit such records to any person in any case where it is
advised by its counsel that it may be held liable for failure to do so, unless
(in cases involving potential exposure only to civil liability) the Fund has
agreed to indemnify the Administrator against such liability. The Administrator
will coordinate with the new administrator for the Fund to ensure that the new
administrator receives the Fund's books and records. As indicated Article 2 and
subject to Article 11, the Administrator is not required to divulge its
proprietary information under any circumstances.
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ARTICLE 10. COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS. The
Administrator undertakes to comply in all material respects with applicable
requirements of the Securities Act of 1933, the Securities Exchange Act of 1934,
the 1940 Act, and any laws, rules and regulations of governmental authorities
having jurisdiction with respect to the duties to be performed by the
Administrator hereunder.
ARTICLE 11. INTERNET ACCESS. Data and information may be made
electronically accessible to the Fund, its adviser and/or sub-adviser, and its
successor administrator through Internet access to one or more links provided by
the Administrator ("Web Link"). All rights in Web Link (including text and "look
and feel" attributes) are owned by Administrator. Any commercial use of the
content or any other aspect of Web Link requires the written permission of
Administrator. Use of the Web Link by the Fund or its agents will be subject to
any terms of use set forth on the web site. A Web Link and the information
(including text, graphics and functionality) in the Web Link is presented "As
Is" and "As Available" without express or implied warranties including, but not
limited to, implied warranties of non-infringement, merchantability and fitness
for a particular purpose. Administrator neither warrants that the Web Link will
be uninterrupted or error free, nor guarantees the accessibility, reliability,
performance, timeliness, sequence, or completeness of information provided on
the Web Link.
ARTICLE 12. ENTIRE AGREEMENT; AMENDMENTS. This Agreement constitutes
the entire agreement between the parties hereto and supersedes any prior
agreement, draft or proposal with respect to the subject matter hereof. This
Agreement or any part hereof may be changed or waived only by an instrument in
writing signed by the party against which enforcement of such change or waiver
is sought.
ARTICLE 13. ASSIGNMENT. This Agreement shall not be assignable by
either party without the prior written consent of the other party.
ARTICLE 14. AGREEMENT FOR SOLE BENEFIT OF SEI AND THE FUND. This
Agreement is for the sole benefit of the Administrator and the Fund and will not
be deemed to be for the direct or indirect benefit of the clients or customers
of the Administrator or the Fund. The clients or customers of the Administrator
or the Fund will not be deemed to be third party beneficiaries of this Agreement
nor to have any other contractual relationship with the Administrator by reason
of this Agreement and each party hereto agrees to indemnify and hold harmless
the other party from any claims of its clients or customers against the other
party including any attendant expenses and attorneys' fees, based on this
Agreement or the services provided hereunder.
ARTICLE 15. WAIVER. Any term or provision of this Agreement may be
waived at any time by the party to the benefit thereof by written instrument
executed by such party. No failure of either party hereto to exercise any power
or right granted hereunder, or to insist upon strict compliance with any
obligation hereunder, and no custom or practice of the parties with regard to
the terms of performance hereof, will constitute a waiver of the rights of such
party to demand full and exact compliance with the terms of this Agreement.
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ARTICLE 16. NOTICE. Any notice required or permitted to be given by
either party to the other shall be deemed sufficient if sent by registered or
certified mail, federal express (or substantially similar delivery service),
postage prepaid, addressed by the party giving notice to the other party at the
last address furnished by the other party to the party giving notice: if to the
Fund, at The Japan Fund, Inc., c/o Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000, Attn.: Xxxx Xxxxxx; and if to the Administrator, at Xxx
Xxxxxxx Xxxxxx Xxxxx, Xxxx, Xxxxxxxxxxxx, 00000
ARTICLE 17. FORCE MAJEURE. No breach of any obligation of a party to
this Agreement will constitute an event of default or breach to the extent it
arises out of a cause, existing or future, that is beyond the control and
without negligence of the party otherwise chargeable with breach or default,
including without limitation: work action or strike; lockout or other labor
dispute; flood; war; riot; theft; earthquake or natural disaster. Either party
desiring to rely upon any of the foregoing as an excuse for default or breach
will, when the cause arises, give to the other party prompt notice of the facts
which constitute such cause; and, when the cause ceases to exist, give prompt
notice thereof to the other party.
ARTICLE 18. EQUIPMENT FAILURES. In the event of equipment failures
beyond the Administrator's control, the Administrator shall take reasonable and
prompt steps to minimize service interruptions but shall have no liability with
respect thereto. The Administrator shall develop and maintain a plan for
recovery from equipment failures which may include contractual arrangements with
appropriate parties making reasonable provision for emergency use of electronic
data processing equipment to the extent appropriate equipment is available.
ARTICLE 19. DEFINITIONS OF CERTAIN TERMS. The term "affiliated person,"
when used in this Agreement, shall have the meaning specified in the 1940 Act
and the rules and regulations thereunder, subject to such exemptions as may be
granted by the Securities and Exchange Commission.
ARTICLE 20. HEADINGS. All Article headings contained in this Agreement
are for convenience of reference only, do not form a part of this Agreement and
will not affect in any way the meaning or interpretation of this Agreement.
Words used herein, regardless of the number and gender specifically used, will
be deemed and construed to include any other number, singular or plural, and any
other gender, masculine, feminine, or neuter, as the contract requires.
ARTICLE 21. GOVERNING LAW. This Agreement shall be construed in
accordance with the laws of the State of Delaware and the applicable provisions
of the 1940 Act. To the extent that the applicable laws of the State of
Delaware, or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act, the latter shall control.
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ARTICLE 22. MULTIPLE ORIGINALS. This Agreement may be executed in two
or more counterparts, each of which when so executed shall be deemed to be an
original, but such counterparts shall together constitute but one and the same
instrument.
ARTICLE 23. BINDING AGREEMENT. This Agreement, and the rights and
obligations of the parties hereunder, shall be binding on, and inure to the
benefit of, the parties and their respective successors and assigns.
ARTICLE 24. SEVERABILITY. If any part, term or provision of this
Agreement is held to be illegal, in conflict with any law or otherwise invalid,
the remaining portion or portions shall be considered severable and not be
affected, and the rights and obligations of the parties shall be construed and
enforced as if the Agreement did not contain the particular part, term or
provision held to be illegal or invalid.
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
THE JAPAN FUND, INC.
By: /S/ XXXXXXX X. XXXXXX
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Executive Officer
SEI INVESTMENTS GLOBAL FUNDS SERVICES
By: /S/ XXXX XXXXXXXXX
------------------
Name: Xxxx Xxxxxxxxx
Title: Senior Vice President
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SCHEDULE A
A. Administrator shall perform the following services for the Fund,
subject to industry standards:
(i) Prepare the Fund's annual financial statements; collect and
process financial statement comments and issue subsequent
drafts for review by the Fund and Fund's audit firm as
reasonably requested by the Fund; upon approval by the Fund
and the Fund's audit firm, file the financials statements with
the SEC and issue financial statements to Fund shareholders
within regulatory deadlines;
(ii) Support the audit process by making records available to the
audit firm; reasonably make staff available for audit
inquiries and resolution of same;
(iii) Prepare for the period ended September 30, 2007, the Fund's
N-SAR, collect and process comments and issue subsequent
drafts for review by the Fund and the Fund's audit firm, as
reasonably requested; file the N-SAR with the SEC within
regulatory deadlines;
(iv) Prepare and file the N-CSR (which includes the edgarized
financial statements) for the period ended September 30, 2007,
within regulatory deadlines;
(v) Prepare and perform all annual compliance tests related to
IRS, SEC and Prospectus testing as of 9/30/2007;
(vi) Provide updated files related to the expense roll forwards as
of 9/30/2007;
(vii) Provide QUARKs file from GCOM (provided from the previous semi
annual and annual reports); and
(viii) The Administrator is not responsible for "as-of" adjustments,
trades, or any other information post 9/30, if any, required
to be reflected in the financial statements. The Fund's new
service provider will be required to submit all "as of"
adjustments to the Administrator in a timely manner for the
Administrator to complete the annual financial statements. The
Administrator is not responsible for including "as of"
adjustment information in financial statements if such
adjustment information is received by the Administrator and
there exists insufficient time for the Administrator, the
Fund's auditor or any other appropriate reviewing service
provider to properly review and assess the information;
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B. The Administrator will also supply any financial and performance
information to be inserted into the annual registration statement
update (including without limitation directors compensation,
distribution expenses since inception of 12b-1 plan, reimbursed
expenses and services for sub-accounting and shareholder servicing by
platforms), such information through 9/30 shall be supplied by the
Administrator during the normal registration update period. The Fund's
new service provider is responsible for supplying any remaining
information required to be included in the registration statement. The
Fund's new service providers are also responsible for ensuring that any
historical data disclosed in the current registration statement agrees
to the previously filed registration statements or financial
statements;
C. The Administrator will work with ClearSky to complete the Fund's
registration renewals with expiration date up to November 1, 2007 and
Sales Reports through September 30, 2007, will mail hard copy/CD Blue
Sky files via two day express mail carrier to Xxxxxxxx Xxxxxxxx at
State Street Blue Sky Department 2 Avenue de Lafayette - LCC0684
Xxxxxx, XX 00000 and will electronically convert the Blue Sky data
(final copy) on October 1, 2007;
D. The Administrator will also:
(i) file necessary federal tax extensions relevant to the fiscal
period ending September 30, 2007; the Fund's adviser must
provide to the Administrator all the PFIC identifications and
take full responsibility for such information;
(ii) prepare tax provisions and applicable schedules for the
financial statements; and
(iii) provide data for year-end 1099s;
E. The Administrator will provide by October 10, 2007, to the Fund and its
service provider all Board reports for the quarter and fiscal year end
as of 9/30/2007, including the report of expenses paid by SEI
Investments Distribution Company pursuant to rule 12b-1 and the 38a-1,
Code of Ethics (employee trading for the Fund and for SEI), Financial
Officer certifications and reports for the September 30 quarter and
fiscal year end periods;
F. The Administrator will provide to the Fund all required certifications
signed by the fund accounting director and the financial reporting
director;
G. The Administrator will, within industry standards, respond to
reasonable inquiries and requests from the Fund's new service
providers; and
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H. The Administrator shall neither be responsible for actions or omissions
of any of the Fund's new service providers nor shall the Administrator
be required to divulge its proprietary information in providing any of
the services in this Schedule A notwithstanding anything herein.
[END OF SCHEDULE A]
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SCHEDULE B
FEES: $35,000.00
[END OF SCHEDULE B]
