Exhibit 10.3

December 29, 2004

Dear Gibson:

        I am very pleased to offer you this letter agreement setting forth your
future compensation and benefits as a portfolio manager for Janus Capital
Management LLC and as an employee of Janus Management Holdings Corporation.
Attached are the formal agreements which need to be signed to memorialize your
decision to accept the new portfolio manager compensation plan that will replace
your existing contract. We look forward to our continued relationship with you
and to your many continued contributions to Janus and its affiliates. I have
tried to summarize below the material benefits that you will receive from Janus.

1.Fixed Compensation. Your fixed compensation will include an annual base salary
of $500,000 and additional compensation adjustments as described in the attached
2005 CIO Fixed Income Compensation Plan (Tab A). Your fixed compensation may be
increased or decreased in the future, but your annual base salary of $500,000
will not be decreased unless your duties are reduced whereby you are no longer a
portfolio manager.

2.Variable Compensation. In addition to your fixed compensation, you will
receive periodic performance-based variable compensation as described in the
attached 2005 CIO Fixed Income Compensation Plan (Tab A) that describes, among
other things, the timing and methodology that will be used to compute your
variable compensation.

3.Long Term Incentives. Up to 25% of your annual variable compensation will be
paid in the form of long-term incentive awards. For 2005, such awards will be
comprised of 25% Janus Capital Group restricted stock, 25% Janus Capital Group
options, and 50% investment in Janus funds. Any long-term incentive award will
have a four-year vesting schedule (minimum of 25% vesting per year), subject to
the following accelerated-vesting schedule based on a change in Janus Capital
Group's earnings per share:

Change in EPS Result

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  Total Vesting %

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  Incremental Vesting
% Above Minimum

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  Negative up to 10%   25 % -0-   10.1 - 15%   30 % +5 % 15.1 - 20%   35 % +10 %
20.1 - 25%   40 % +15 % 25.1% - 50%   45 % +20 % > 50%   50 % +25 %

I am also happy to inform you that if all of the portfolio managers enter into
the enclosed agreements by December 31, 2004, the Compensation Committee has
authorized Janus to have your 2004 long-term incentive award become immediately
vested, rather than vesting over a four-year period.

4.Benefits. You will continue to be eligible to participate in the medical,
dental, vision, life insurance, disability programs offered by Janus and the
Janus 401(k), Profit Sharing and Employee Stock Ownership Plan.

5.Business Expense Reimbursement. Janus will promptly reimburse you for all
reasonable expenses incurred in the performance of your duties as portfolio
manager, including without limitation, expenses for entertainment, travel and
use of the telephone. You are required to submit appropriate documentation for
all expenses in accordance with Janus' expense reimbursement policies, as in
effect from time to time.

6.Severance. If your employment is terminated by Janus, you will be entitled to
receive severance benefits (subject to certain qualifications) which are more
fully described in the severance letter enclosed under Tab B. In particular, you
would be entitled to an amount equal to your total cash

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compensation from the prior four (4) full quarters prior to the termination,
plus certain welfare benefits for you and your family (subject to certain
qualifications including the execution of a non-solicitation agreement). If you
have "good reason" and terminate your employment (as defined in Tab B), you will
be entitled to certain severance benefits. Also, if you decide to leave Janus
voluntarily and sign a two-year non-compete agreement, your unvested restricted
stock awards granted after March 15, 2003, and your future unvested equity
awards (awarded after December 30, 2004) will continue to vest for their
original life subject to your compliance with the two-year non-compete (after
which the vested portion will be delivered to you subject to any share
withholding election) subject to approval by the Chief Executive Officer or the
Chief Investment Officer. Your severance benefits and applicable qualifications
are more fully described in your severance agreement under Tab B.

7.Change in Control Agreement. If your employment is terminated (or, as defined
in the agreement, your employment or compensation is materially reduced, or you
are relocated more than 40 miles away) in connection with or following a change
in control of Janus Capital Group Inc., you may be entitled to receive special
change in control severance benefits, which are described in the Change in
Control Agreement enclosed under Tab C. In particular, you would be entitled to
an amount equal to two (2) times your average annual cash compensation earned in
the two four-quarter periods immediately preceding the termination of employment
(or if higher, in the two four-quarter periods immediately preceding the change
in control), plus the continuation of welfare benefits and certain cash payments
related to the Janus 401(k) Plan. These payments will be "grossed-up" (if
necessary) to cover any excise taxes that you may incur.

8.Attorney's Fees after a Change in Control. As more fully described in the
Change in Control Agreement, if after a "change-in control" you incur legal fees
and expenses disputing in good faith any issue relating to the termination of
your employment or enforcing any benefit or right provided by such agreement,
Janus agrees to reimburse you for such legal fees and expenses if you materially
prevail in such dispute. Also, as more fully described in the Change in Control
Agreement, you will continue to receive your full compensation in effect until
the dispute is fully resolved or the term of the Change in Control Agreement
ends.

9.Indemnification. Janus Capital Management LLC and/or Janus Management Holdings
Corporation shall indemnify you to the fullest extent permitted under law from
and against any expenses (including but not limited to attorneys' fees, expenses
of investigation and preparation and fees and disbursements of your accountants
or other experts), judgments, fines, penalties and amounts paid in settlement
actually and reasonably incurred by you in connection with any proceeding in
which you were or are made party or was or is involved (for example, as a
witness) by reason of the fact you were or are employed by the Company, except
to the extent that such expense, judgment, fine, penalty or amount arises from
your gross negligence or willful misconduct.

        Such indemnification is subject to:

        (i)    Janus promptly receiving written notice that a claim or liability
has been asserted or threatened ("Notice of Claim");

        (ii)   you providing reasonable cooperation and assistance in the
defense or settlement of a claim; and

        (iii)  Janus being afforded the opportunity to have the sole control
over the defense or settlement of such claim or liability.

Unless within ten days after receiving the Notice of Claim, Janus notifies you
in writing of its intent to defend against such claim or liability, you may
defend, settle and/or compromise any such claim or liability, and be indemnified
for all losses resulting from such defense, settlement and/or compromise. You
also may participate in such defense at your own cost and expense.

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10.Confidentiality. Consistent with the terms of your confidentiality
obligations as an employee of Janus and except as set forth in the next
sentence, you agree that you will not, directly or indirectly, and will not
permit your agent or representative, in any form or by any means, to use,
disclose, or furnish, to any person or entity, without the prior written consent
of Janus, the terms of this letter, the 2005 Portfolio Management Compensation
Plan (Tab A) and the enclosed agreements under Tab B and Tab C (once signed).
This Section 10 shall not prohibit disclosure (i) to your attorneys, accountants
or immediate family, (ii) in connection with the filing of your taxes, or
(iii) required to be disclosed by court order or pursuant to applicable law or
regulation, provided that you notify the Company as soon as possible so that the
Company may attempt at its sole expense to obtain a protective order or other
form of protection against disclosure.

This letter, the 2005 Portfolio Management Compensation Plan (Tab A) and the
enclosed agreements under Tab B and Tab C (once signed) will supersede all
previous offers, employment agreements, rights (contractual or otherwise) or
other correspondence or communications, express or implied, regarding the terms
of your employment with Janus (other than your equity award agreements), and
represent the sole, exclusive and complete agreement between you and Janus
regarding or relating to their respective subject matters (including, without
limitation, your rights to severance payments or upon a change of control and
your entitlement to indemnification). This letter is subject to the terms and
conditions of the agreements set forth in Tabs A, B and C, all of which are an
integral part of this letter, and the terms, rights and definitions set forth in
such agreements shall control and supersede any conflicting term(s) in this
letter.

You hereby agree that, to the extent you felt necessary, you have consulted with
your counsel with respect to the terms of these agreements. You understand that
these agreements are deemed to have been drafted jointly by the parties. Any
uncertainty or ambiguity will not be construed for or against any party based on
attribution of drafting to any party.

Please sign below to accept the general terms and conditions of your employment,
and if acceptable, please sign the enclosed copies of the severance letter (Tab
B) and the Change in Control Agreement (Tab C). If you have any questions
regarding this letter, please feel free to contact me. We are looking forward to
the start of another year with you as an integral part of the Janus team.

    Sincerely,
 
 
/s/  GARY BLACK      
 
 
Gary Black

ACCEPTED AND AGREED TO THE
30th DAY OF DECEMBER, 2004

 

 
/s/  R. GIBSON SMITH      

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Name: Richard Gibson Smith
 
 

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