EXHIBIT 10.1
 
EXECUTION VERSION

 
INVESTMENT AND STRATEGIC COOPERATION AGREEMENT
 
by and between
 
JANUS CAPITAL GROUP INC.
 
and
 
THE DAI-ICHI LIFE INSURANCE COMPANY, LIMITED
 
Dated as of August 10, 2012
 

 
 

--------------------------------------------------------------------------------

 

Table of Contents
 

   
Page
   
ARTICLE I DEFINITIONS
2
Section 1.1
Definitions
2
Section 1.2
Additional Defined Terms
5
Section 1.3
Interpretation and Construction
7
   
ARTICLE II PURCHASE OF THE COMPANY COMMON STOCK
8
Section 2.1
Purchase of the Company Common Stock
8
Section 2.2
Prohibition on Company Repurchases
9
Section 2.3
Share Purchase Agent
9
Section 2.4
Regulatory Filings
9
Section 2.5
Securities Laws; Blackout Periods
10
Section 2.6
Acquisition Notice
10
Section 2.7
Preemptive Rights
10
   
ARTICLE III STANDSTILL
13
Section 3.1
Standstill
13
Section 3.2
Standstill Exceptions
14
Section 3.3
Standstill Fall-Away
14
   
ARTICLE IV TRANSFERS
15
Section 4.1
Transfer Restrictions
15
Section 4.2
Permitted Transfers During Restricted Period
17
Section 4.3
Permitted Transfers After the Restricted Period
17
Section 4.4
Volume Limitation
18
Section 4.5
Right of First Refusal
18
Section 4.6
Right of First Offer
19
Section 4.7
Mandatory Transfers
20
Section 4.8
Related Parties
21
   
ARTICLE V GOVERNANCE AND INVESTOR RIGHTS
21
Section 5.1
Voting
21
Section 5.2
Board of Directors
22
Section 5.3
Information Rights
24
Section 5.4
Confidentiality
24
Section 5.5
Registration Rights
25
   
ARTICLE VI ASSET MANAGEMENT AND STRATEGIC COOPERATION
25
Section 6.1
Management of the Investor’s Assets
25
Section 6.2
Coordination Committee
29
Section 6.3
Japan Sales Targets
29
Section 6.4
Strategic Cooperation
30
Section 6.5
Exchange of Expertise and Human Resources
30

 
 
 
 
i

--------------------------------------------------------------------------------

 
 
 
 
ARTICLE VII REPRESENTATIONS AND WARRANTIES
31
Section 7.1
Representations and Warranties of the Company
31
Section 7.2
Representations and Warranties of the Investor
34
   
ARTICLE VIII TERMINATION
36
Section 8.1
Termination
36
Section 8.2
Effect  of Termination
38
   
ARTICLE IX MISCELLANEOUS
39
Section 9.1
Notices
39
Section 9.2
Amendment and Waiver
40
Section 9.3
Specific Performance
40
Section 9.4
Headings
40
Section 9.5
Severability
40
Section 9.6
Public Announcements
41
Section 9.7
Entire Agreement; No Third Party Beneficiaries
41
Section 9.8
GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
41
Section 9.9
Further Assurances
42
Section 9.10
Successors and Assigns
42
Section 9.11
Counterparts
43

Exhibits
 
Exhibit A
Delaware 203 Approval
Exhibit B
Form of Option Agreement
Exhibit C
Registration Rights

 
ii

--------------------------------------------------------------------------------

 

INVESTMENT AND STRATEGIC COOPERATION AGREEMENT
 
This Investment and Strategic Cooperation Agreement, dated as of August 10, 2012
(this “Agreement”), by and between Janus Capital Group Inc., a Delaware
corporation (the “Company”), and The Dai-ichi Life Insurance Company, Limited, a
Japanese corporation (the “Investor”).  The Company and the Investor may be
referred to in this Agreement individually as a “Party” and collectively as the
“Parties”.
 
WHEREAS, the Parties desire to enter into a strategic alliance on the terms and
conditions contemplated by this Agreement;
 
WHEREAS, the Parties desire to exchange expertise and human resources among the
Company, the Investor and the Investor’s Affiliate (as hereinafter defined),
DIAM Co., Ltd., and a key element of the alliance for the Investor is to
increase its knowledge and expertise in the asset management business;
 
WHEREAS, as part of such strategic alliance, and subject to the terms and
conditions of this Agreement, the Investor intends to invest an aggregate of at
least $2,000,000,000 of its general account assets into funds and other
investment products managed by the Company and its Affiliates, including an
aggregate of at least $120,000,000 of seed capital investments, and to promote
the distribution, marketing and cross selling in Japan by its Affiliate, DIAM
Co., Ltd., of the Company’s investment products, and the Company intends to
consult with the Investor in good faith regarding the promotion of DIAM Co.,
Ltd. products in the United States;
 
WHEREAS, in connection with the transactions described above, the Investor
desires to acquire Beneficial Ownership (as hereinafter defined) of at least 15%
of the common stock, par value $0.01 per share, of the Company (the “Company
Common Stock”) and to account for such investment using the equity accounting
method under Japanese generally accepted accounting principles (or such other
accounting principles as may be adopted by the Investor for preparation of its
financial statements);
 
WHEREAS, in consideration of the benefits to be obtained by the Company by
virtue of the arrangements described above, and in light of the undertakings
made by the Investor herein, the Company is willing to permit the Investor to
acquire from time to time as permitted hereby Beneficial Ownership of shares of
the Company Common Stock in accordance with and subject to the conditions set
forth herein and in the Option Agreement (as hereinafter defined) (the
“Acquisition”) and to grant the rights described herein for the Investor to send
its representatives to the Company, participate as an observer in executive
committee meetings of the Company and have its designee be appointed to the
board of directors of the Company (the “Company Board”), in each case subject to
the terms and conditions hereof;
 
WHEREAS, the Company Board has, subject to the execution of this Agreement,
adopted a resolution, substantially in the form set forth under Exhibit A (the
“203 Approval”), to approve the Acquisition and the other transactions
contemplated by
 
 
 
 

--------------------------------------------------------------------------------

 
 
this Agreement for purposes of Section 203 of the Delaware General Corporation
Law (the “DGCL”); and
 
WHEREAS, concurrently with the execution of this Agreement, the Company and the
Investor are entering into an option agreement (the “Option Agreement”), in the
form set forth under Exhibit B.
 
NOW, THEREFORE, in consideration of the mutual covenants and premises of this
Agreement and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Parties agree as follows:
 
ARTICLE I
 
DEFINITIONS
 
Section 1.1           Definitions.  For purposes of this Agreement:
 
“Affiliate” means, with respect to any Person, any other Person that, directly
or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, such Person.  The term “control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise, including the ability
to elect the members of the board of directors or other governing body of a
Person, and the terms “controlled” and “controlling” have correlative meanings.
 
“Applicable Accounting Standards” means Japanese generally accepted accounting
principles or such other accounting principles as are then governing preparation
of the Investor’s financial statements.
 
“Business Day” means any day (other than a day which is a Saturday, Sunday or
legal holiday in the State of New York or a national holiday in Japan) on which
banks are open for business in New York City and Tokyo, Japan.
 
“Company Securities” means (i) any shares of capital stock or other equity
interests of the Company or of any of its Subsidiaries; (ii) any other
securities of the Company or of  any of its Subsidiaries granting voting rights;
(iii) any warrants, options, convertible or exchangeable securities,
subscriptions, calls or other rights (including any preemptive or similar
rights) to purchase or acquire any of the securities described in the foregoing
clauses (i) and (ii); or (iv) any security, instrument or agreement granting
economic rights based upon the value of, or the value of which is determined by
reference to any of the securities described in the foregoing clauses (i)
through (iii), regardless of whether such security, instrument or agreement is
or may be settled in securities, cash or other assets.
 
 
 
2

--------------------------------------------------------------------------------

 
 
“DIAM” means DIAM Co., Ltd., a corporation formed under the laws of Japan.
 
“DIAM Global High Yield Account” means the DIAM separate account managed
pursuant to a Sub-Investment Management Agreement, by and between DIAM and Janus
Capital Management LLC, dated July 8, 2011.
 
“DIAM Global Research Account” means the DIAM separate account managed pursuant
to an Investment Management Agreement, by and between DIAM and Janus Capital
Management LLC, dated September 28, 2006.
 
“Effective Time” means the first date upon which the Investor Beneficially Owns
15% of the issued and outstanding shares of Company Common Stock (excluding
options, warrants and other derivatives that have not been exercised and
physically settled in shares of Company Common Stock).
 
“Event of Financial Distress” means (a) with respect to the Investor, either (1)
Investor’s solvency margin ratio, as calculated in accordance with Japanese
regulatory requirements, is less than 300% or (2) Investor’s regulatory capital
is less than the minimum amount thereof required by applicable Law in Japan and
(b) with respect to the Company, (1) the Company is in breach of any financial
covenant of any outstanding indebtedness (after giving effect to any waiver,
grace period or extension thereof) or (2) the Company’s independent outside
auditors have issued a qualified opinion as to the Company’s “going concern”
status.
 
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
 
“Governmental Authority” means any supranational, national, federal, state,
provincial or local government, foreign or domestic, or the government of any
political subdivision of any of the foregoing, or any entity, authority, agency,
ministry or other similar body exercising executive, legislative, judicial,
regulatory or administrative authority or functions of or pertaining to
government, including any authority or other quasi-governmental entity
established by a Governmental Authority to perform any of such functions
(including any national securities exchange or the equivalent) with relevant
jurisdiction.
 
“Insolvency Event” means, with respect to any Party (the “Insolvent Party”), the
occurrence of the any of the following:  (i) (A) an involuntary proceeding is
commenced or an involuntary petition is filed in a court of competent
jurisdiction seeking: (I) relief in respect of the Insolvent Party under Title
11 of the United States Code or any other applicable bankruptcy, insolvency,
receivership or similar Law in Japan or in any other applicable jurisdiction,
(II) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Insolvent Party or (III) the winding-up
or liquidation of the Insolvent Party, and (B) such proceeding or petition shall
continue unstayed or undismissed for a period of 60 consecutive calendar days or
an order or decree approving or ordering any matters described in the foregoing
clauses (I),
 
 
 
3

--------------------------------------------------------------------------------

 
 
(II) and (III) shall be entered; or (ii) the Insolvent Party shall (A)
voluntarily commence any proceeding or file any petition seeking relief under
Title 11 of the United States Code or any other applicable bankruptcy,
insolvency, receivership or similar Law in Japan or any other applicable
jurisdiction, (B) consent to the institution of, or fail to contest in a timely
and appropriate manner, any proceeding or the filing of any petition described
in the foregoing clause (i), (C) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for
itself, (D) file an answer admitting the material allegations of a petition
filed against it in any proceeding described in the foregoing clause (i), (E)
make a general assignment for the benefit of creditors or (F) admits in writing
its inability, or fail generally, to pay its debts as they become due.
 
“Law” means any federal, state, provincial, local, domestic or foreign law,
common law, ordinance, code, writ, injunction, order, decree, statute, rule or
regulation of any Governmental Authority.
 
“Material Adverse Effect” means, with respect to the Company or the Investor, as
applicable, any event, change, effect, development, or occurrence that is or
would be reasonably expected to be materially adverse to the business, assets,
financial condition or results of operations of such Person and its
Subsidiaries, taken as a whole; provided, however, that no such event, change,
effect, development, or occurrence resulting or arising from or in connection
with any of the following matters shall be deemed by itself or by themselves,
either alone or in combination, to constitute or contribute to a Material
Adverse Effect: (a) the general conditions in the industry in which such Person
operates to the extent not having a materially disproportionate effect on such
Person and its Subsidiaries, taken as a whole relative to other comparable
participants in such Person’s industry; (b) general economic or regulatory,
legislative or political conditions or securities, credit, financial or other
capital markets conditions (including changes generally in prevailing interest
rates, currency exchange rates, credit markets and price levels or trading
volumes), in each case in the United States, Japan or elsewhere in the world, to
the extent not having a materially disproportionate effect on such Person and
its Subsidiaries, taken as a whole, relative to other comparable participants in
such Person’s industry; (c) any act of civil unrest, war or terrorism or any
escalation or worsening of any such acts; (d) the announcement, pendency or
consummation of this Agreement or the other transactions contemplated hereby;
(e) changes in any Laws, GAAP, Japanese generally accepted accounting principles
(or such other accounting principles as may be adopted by the Company or the
Investor, as applicable, for preparation of its financial statements) (or
interpretation or enforcement thereof) to the extent not having a materially
disproportionate effect on such Person and its Subsidiaries, taken as a whole,
relative to other comparable participants in such Person’s industry; (f) the
failure, in and of itself, of such Person to meet any internal or published
projections, forecasts, estimates or predictions in respect of assets under
management, revenues, earnings or other financial or operating metrics before,
on or after the date of this Agreement, or changes or prospective changes in the
market price or trading volume of such Person’s securities (it being understood
that the underlying facts giving rise or contributing to such failure or change
may be taken into account in
 
 
 
4

--------------------------------------------------------------------------------

 
 
determining whether there has been a Material Adverse Effect if such facts are
not otherwise excluded under this definition).
 
“Order” means any order, decision, judgment, writ, injunction, decree, award or
other determination of any Governmental Authority.
 
“Shares” means shares of Company Common Stock Beneficially Owned by the
Investor, and any other securities issued in respect of such shares in any share
exchange, merger, recapitalization, dividend, stock split or other similar
transaction that are Beneficially Owned by the Investor, or any right to acquire
any such shares or other securities.
 
“Subsidiary” means, with respect to any Person, any entity of which securities
or other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions, or
otherwise bestowing the power to direct the management of such entity are, at
the time, directly or indirectly owned by such Person or any entity for which
such Person serves as the managing member or general partner.
 
Section 1.2           Additional Defined Terms.  The following terms have the
meanings set forth in the Sections set forth below:
 
Term
Section
203 Approval
Recitals
Acceptance Notice
2.7(b)
Acquisition
Recitals
Administrative Guidance
4.1(b)
Affiliated Transferee
4.3(a)
Agreement
Preamble
Approved Tender Offer
4.1(a)
Beneficial Ownership
2.1(a)
Blackout Period
2.5(a)
Change of Control
3.3(e)
Company
Preamble
Company Board
Recitals
Company Common Stock
Recitals
Company Repurchase Event
4.7
Company SEC Documents
7.1(g)
Coordination Committee
6.2
Designation Right
5.2(a)
DGCL
Recitals
DIAM Channel Sales
6.2
DIAM Channel Sales Targets
6.3
DOJ
2.4(a)
Eligible Investments
6.1(f)
Equity Issuance
2.7(d)

 
 
 
 
5

--------------------------------------------------------------------------------

 
 
 

Term Section
Executive Committee
6.2
Exempt Equity Issuance
2.7(d)
FTC
2.4(a)
Fundamental Transaction
3.3(b)
GAAP
7.1(h)
Governmental Order
4.1(b)
HSR Act
2.4(a)
Identified Transferee
4.5(a)
Information Rights
5.3
Initial Funding Date
6.1(a)
Initial Investment
6.1(a)
Initial Seed Capital Investment Fees
6.1(g)(ii)
Initial Seed Capital Investments
6.1(g)(ii)
Insolvent Party
1.1
Invested Assets
6.1(a)
Investor
Preamble
Investor Parent
4.3(a)
Investor Representative
5.2(a)
New Securities
2.7(a)
NYSE Rule
2.7(a)
Option Agreement
Recitals
Ownership Limit
2.1(a)
Parties
Preamble
Party
Preamble
Permitted Affiliate Sale
4.3(a)
Permitted Non-Public Transfer
4.3(b)
Permitted Public Transfer
4.3(c)
Permitted Sales
4.2
Person
3.1
Potential Option Shares
8.1(d)
Preemptive Rights Notice
2.7(b)
Preemptive Rights Shares
2.7(a)
Pre-Issuance Ownership Percentage
2.7(g)
Purchase Window
2.1(a)
Receiving Party
5.4
Registration Rights
5.5
Regulatory Transfer
4.1(b)
Representatives
5.4
Restricted Period
4.1(a)
Restricted Period Approved Tender Offer
4.1(a)
ROFO Negotiation Period
4.6
ROFO Notice
4.6
ROFO Open Period
4.6
ROFO Shares
4.6

 
 
 
 
6

--------------------------------------------------------------------------------

 
 
 

Term Section
ROFR Exercise Period
4.5(b)
ROFR Notice
4.5(a)
ROFR Open Period
4.5(c)
ROFR Price
4.5(a)
ROFR Shares
4.5(a)
ROFR Terms
4.5(a)
SEC
2.5(b)
Securities Act
4.3(b)
Seed Capital Investments
6.1(c)
Senior Executive
4.1(b)
Standstill Fall-Away Date
3.3
Standstill Restrictions
3.1(i)
Stockholder Approved Issuance
2.7(f)
Subsequent Offering
4.1(a)
Temporary Redemption Date
6.1(f)
Transfer
4.1(a)
True-up Equity Issuance
2.7(d)
   

 
Section 1.3           Interpretation and Construction.
 
(a)           In this Agreement, except to the extent otherwise provided or that
the context otherwise requires: (i) when a reference is made in this Agreement
to an Article, Section, Schedule or Exhibit, such reference is to an Article or
Section of, or a Schedule or Exhibit to, this Agreement; (ii) the table of
contents and headings for this Agreement are for reference purposes only and do
not affect in any way the meaning or interpretation of this Agreement;
(iii) whenever the words “include,” “includes” or “including” are used in this
Agreement, they are deemed to be followed by the words “without limitation”;
(iv) the words “hereof,” “herein” and “hereunder” and words of similar import,
when used in this Agreement, refer to this Agreement as a whole and not to any
particular provision of this Agreement; (v) terms defined in this Agreement have
the defined meanings when used in any certificate or other document made or
delivered pursuant hereto; (vi) the definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such terms;
(vii) references to a Person are also to its successors and permitted assigns;
(viii) the use of “or” is not intended to be exclusive unless expressly
indicated otherwise and (ix) “$” refers to U.S. dollars.  References to “Law”,
“Laws” or to a particular statute or Law shall be deemed also to include such
Laws or statutes as such Laws or statutes are from time to time amended,
modified or supplemented, including by succession of comparable successor Laws.
 
(b)           The Parties have participated jointly in the negotiation and
drafting of this Agreement and the other agreements, documents and instruments
executed and delivered in connection herewith with counsel sophisticated in
investment transactions.  If an ambiguity or question of intent or
interpretation arises, this Agreement and the agreements, documents and
instruments executed and delivered in connection herewith
 
 
 
7

--------------------------------------------------------------------------------

 
 
shall be construed as if drafted jointly by the Parties and no presumption or
burden of proof shall arise favoring or disfavoring any Party by virtue of the
authorship of any provisions of this Agreement and the agreements, documents and
instruments executed and delivered in connection herewith.
 
ARTICLE II
 
PURCHASE OF THE COMPANY COMMON STOCK
 
Section 2.1           Purchase of the Company Common Stock.
 
(a)           The Investor shall use commercially reasonable efforts to acquire,
through open market transactions (including, for the avoidance of doubt, by
means of block trade purchases and through purchases and sales of options,
warrants and other derivative instruments, in each case that are physically
settled in shares of Company Common Stock (provided, that, such options,
warrants or other derivative instruments may be settled in cash in connection
with any rollover of such instrument)), and, to the extent utilized in the
Investor’s sole discretion, pursuant to the Option Agreement, during the period
beginning on the date hereof and ending on the first anniversary of the date
hereof (the “Purchase Window”), Beneficial Ownership of no less than 15% of the
issued and outstanding shares of the Company Common Stock and up to an aggregate
maximum of 20% of the issued and outstanding shares of the Company Common Stock
(the “Ownership Limit”); provided, however, that if the Investor fails to
acquire Beneficial Ownership of at least 15% of the issued and outstanding
shares of the Company Common Stock prior to the expiration of the Purchase
Window, the Investor shall, following the expiration of the Purchase Window and
prior to termination of this Agreement, continue to use commercially reasonable
efforts to acquire Beneficial Ownership of at least 15% of the issued and
outstanding shares of the Company Common Stock.  Except as otherwise provided in
this Agreement, Investor shall not acquire shares of the Company Common Stock in
excess of the Ownership Limit.  For purposes of this Agreement, “Beneficial
Ownership” shall be defined consistent with such term’s meaning under Rule 13d-3
or 13d-5 under the Exchange Act and other terms of similar import shall have
comparable meanings; provided, however, that for purposes of this Agreement and
the Option Agreement, Beneficial Ownership of the Investor shall be deemed to
exclude the Option Shares (as defined in Exhibit B), except to the extent such
Option Shares are issued, outstanding and paid for pursuant to the Investor’s
exercise of the Conditional Option (as defined in Exhibit B).  Notwithstanding
anything to the contrary herein, the Investor shall not commence, and shall
cause its purchases of the Company Common Stock to be conducted in a manner so
as not to constitute, a tender offer (as such term is understood and interpreted
for purposes of Section 14(d) of the Exchange Act) with respect to any
securities of the Company.  For purposes of this Section 2.1(a), “commercially
reasonable efforts” shall not require the Investor to acquire shares of the
Company Common Stock outside the limitations set forth in the approval of the
board of directors of the Investor regarding the Investor’s entry into this
Agreement, a full and complete description of which limitations has been
received by the Company in writing prior to the date hereof.
 
 
 
8

--------------------------------------------------------------------------------

 
 
(b)           For purposes of this Agreement, all determinations of the amount
of issued and outstanding shares of the Company Common Stock shall be based on
information set forth in the most recent quarterly or annual report, and any
current report subsequent thereto, filed by the Company with the SEC, unless the
Company shall have updated such information by delivery of written notice to the
Investor.
 
(c)           In the event that the Company issues Company Securities that are
voting securities other than Company Common Stock, the Parties agree to work in
good faith to enter into appropriate amendments to this Agreement to account for
and treat such new class of Company Securities consistent with the Investor’s
continued accounting for its investment in the Company using the equity
accounting method under Japanese generally accepted accounting principles (or
such other accounting principles as may be adopted by the Investor for
preparation of its financial statements).
 
Section 2.2           Prohibition on Company Repurchases.  From the date of this
Agreement until the earlier of (a) the one year anniversary of the date hereof
and (b) the date the Investor exercises its Designation Right pursuant to
Section 5.2 hereof, neither the Company nor any of its Subsidiaries shall,
without the Investor’s prior written consent, repurchase or offer to repurchase
any issued and outstanding shares of the Company Common Stock, other than
repurchases of shares of the Company Common Stock made in the ordinary course of
business consistent with past practice with respect to shares of the Company
Common Stock (x) owned by employees upon the termination of such employees’
employment or (y) pursuant to a repurchase program utilized by the Company to
offset issuances of shares of Company Common Stock pursuant to the Company’s
compensation or incentive plans.
 
Section 2.3           Share Purchase Agent.  To effect the Acquisition, the
Investor shall engage a nationally recognized securities firm in the United
States to act as the Investor’s share purchase agent.
 
Section 2.4           Regulatory Filings.
 
(a)           As promptly as reasonably practicable after the date of this
Agreement, each of the Company and the Investor shall file a Notification and
Report Form and any other required materials with the Federal Trade Commission
(the “FTC”) and the United States Department of Justice (the “DOJ”) under the
Hart Scott Rodino Antitrust Improvements Act of 1976 (the “HSR Act”) to permit
the Acquisition and the other transactions contemplated by this Agreement but
such filing shall be at the minimum notification threshold necessary to permit
the same.
 
(b)           The Investor shall not acquire any shares of the Company Common
Stock in violation of the HSR Act or other applicable Law.
 
(c)           The Company and the Investor shall cooperate with each other in
connection with preparing and/or making any filing under the HSR Act for the
Acquisition and the other transactions contemplated by this Agreement, and each
of them
 
 
 
9

--------------------------------------------------------------------------------

 
 
shall comply at the earliest practicable date with any request under the HSR Act
for additional information, documents or other materials from the FTC or the DOJ
in respect of the Acquisition and the other transactions contemplated by this
Agreement.  Each of the Company and the Investor shall use commercially
reasonable efforts to obtain the expiration or early termination of the
applicable waiting period under the HSR Act.  The Company and the Investor shall
cooperate with respect to the filings, notices and approvals described in
Sections 7.1(c) and 7.2(c) and shall use commercially reasonable efforts to make
or obtain in a timely manner such filings, notices and approvals.  In addition,
the Company and the Investor agree to keep each other reasonably informed of the
status of such filings, notices and approvals, including promptly notifying each
other of (x) the submission of any such filing or notice, (y) the receipt of any
material communication from a Governmental Authority relating to any such
filing, notice or approval and (z) the receipt of any such approval.
 
Section 2.5           Securities Laws; Blackout Periods.
 
(a)           The Investor acknowledges that the Company is an issuer with
securities registered pursuant to the Exchange Act and that the trading in
securities of the Company (including shares of the Company Common Stock) by the
Investor while it is in possession of material non-public information concerning
the Company may subject the Investor to liability under applicable
Law.  Accordingly, notwithstanding anything in this Agreement to the contrary,
the Investor agrees that it shall not trade in securities of the Company
(including shares of the Company Common Stock) at any time that it is in
possession of material non-public information concerning the Company (a
“Blackout Period”).  Notwithstanding the foregoing, the Company acknowledges
that the Investor will not be deemed to be trading in securities of the Company
while in possession of material non-public information concerning the Company if
it engages in the purchasing or selling of securities of the Company in
accordance with one of the affirmative defenses available pursuant to paragraph
(c) of Rule 10b5-1 under the Exchange Act.
 
(b)           The Investor shall, in the course of its acquisition of shares of
the Company Common Stock, comply with all applicable Laws, including the
requirement to file a Schedule 13D and amendments thereto with the United States
Securities and Exchange Commission (the “SEC”) pursuant to the Exchange Act.
 
Section 2.6           Acquisition Notice.  As promptly as reasonably practicable
following the end of each Business Day during which the Investor acquires
Beneficial Ownership of shares of the Company Common Stock, the Investor shall
notify the Company in writing of (a) the number of shares of the Company Common
Stock so acquired on such Business Day and (b) the price per share paid by the
Investor for such shares of the Company Common Stock.
 
Section 2.7           Preemptive Rights.
 
(a)           For so long as the Investor Beneficially Owns at least 15% of the
outstanding Company Common Stock (prior to giving effect to the applicable
issuance of
 
 
10

--------------------------------------------------------------------------------

 
 
 
New Securities), if the Company proposes to issue any shares of the Company
Common Stock (including issuances of the Company Common Stock pursuant to
exchangeable or convertible securities of the Company or other securities
exercisable for shares of the Company Common Stock (upon exercise or in
accordance with the terms thereof)) (“New Securities”), the Investor shall have
the right to purchase up to such number of shares of the Company Common Stock
that would allow the Investor to maintain Beneficial Ownership of the issued and
outstanding shares of the Company Common Stock, after giving effect to the
issuance of the applicable New Securities, that is no less than the Investor’s
Pre-Issuance Ownership Percentage (such shares, the “Preemptive Rights Shares”);
provided, however, that the Investor shall not have this purchase right to the
extent that an issuance of the Preemptive Rights Shares to the Investor would
require approval of the stockholders of the Company pursuant to Rule 312 of the
New York Stock Exchange Listed Company Manual or any successor rule thereof (the
“NYSE Rule”), unless such stockholder approval is obtained.  Notwithstanding the
foregoing, to the extent the Company issues securities, other than Company
Common Stock, that are exchangeable for, or convertible into, or otherwise
exercisable for, shares of the Company Common Stock, the Investor shall only be
entitled to exercise its right to purchase Preemptive Rights Shares pursuant to
this Section 2.7 immediately prior to the time that the shares of Company Stock
underlying such securities become issued, with such right subject to the actual
issuance of the applicable underlying shares of Company Common Stock.
 
(b)           The Company shall provide the right contemplated by Section 2.7(a)
to the Investor by delivering a written notice to the Investor (the “Preemptive
Rights Notice”) stating (i) the Company’s intention to issue New Securities,
(ii) the amount of such New Securities that the Company proposes to issue in the
aggregate and, correspondingly, the number of Preemptive Rights Shares that the
Investor is entitled to purchase and (iii) the price of such New Securities (or
(x) if such prices are not clearly identifiable, as may be in the case of an
Equity Issuance, such effective price per share as is reasonably determined by
the Company in good faith, which shall in no event be greater than the
then-applicable market price of the Company Common Stock or (y) in the case of
issuances of restricted stock, the fair market value of such restricted stock as
determined by the Company in the ordinary course in connection with such
issuance) of the Preemptive Rights Shares.  Within ten (10) Business Days
following the delivery of the Preemptive Rights Notice by the Company to the
Investor, the Investor may, by delivery of a written notice of acceptance to the
Company (the “Acceptance Notice”), elect to purchase all, or any portion, of the
Preemptive Rights Shares that the Investor is then entitled to purchase pursuant
to this Section 2.7 for the price indicated in the Preemptive Rights
Notice.  The delivery of the Acceptance Notice shall be evidence of the
Investor’s irrevocable commitment to purchase the number of Preemptive Rights
Shares indicated in the Acceptance Notice for the price indicated in the
Preemptive Rights Notice, and the consummation of the sale and purchase of the
Preemptive Rights Shares shall occur concurrently with or as promptly as
practicable following the Company’s issuance of the corresponding New
Securities.
 
 
 
11

--------------------------------------------------------------------------------

 
 
(c)           Notwithstanding anything in this Section 2.7 to the contrary, if
the amount of New Securities to be issued is for any reason less than the amount
that was initially proposed to be issued as indicated in the Preemptive Rights
Notice, the Company may (whether before or after the Investor has delivered an
Acceptance Notice to the Company) decrease the number of Preemptive Rights
Shares that the Investor is entitled to purchase pursuant to this Section 2.7 to
an amount not less than the amount necessary to allow the Investor to maintain
(but not exceed) its Pre-Issuance Ownership Percentage after giving effect to
the issuance of the applicable New Securities.
 
(d)           Notwithstanding anything in this Section 2.7 to the contrary,
Section 2.7(a) shall not apply, and the Company shall have no obligation to
sell, and the Investor shall have no right to purchase from the Company, any
shares of the Company Common Stock or any other securities of the Company, if
the Company proposes to issue New Securities solely to provide equity
compensation for employment and/or services by directors, officers, employees,
consultants or other service providers of the Company or its Affiliates (an
“Equity Issuance”) and such Equity Issuance would not cause the Investor’s
Beneficial Ownership of shares of the Company Common Stock to decrease to less
than 15% of the issued and outstanding shares of the Company Common Stock (after
giving effect to such issuance) (an “Exempt Equity Issuance”); provided, that
for the avoidance of doubt, to the extent such Equity Issuance would cause the
Investor’s Beneficial Ownership of shares of the Company Common Stock to
decrease to less than 15% of the issued and outstanding shares of the Company
Common Stock (after giving effect to such issuance), the Investor shall have the
right to purchase Preemptive Rights Shares in accordance with the provisions of
Section 2.7(a), subject to the conditions and limitations set forth therein
(including the NYSE Rule), and subject to the procedures set forth in Section
2.7(b) (a “True-up Equity Issuance”). The Company shall provide written notice
to the Investor at least ten (10) Business Days prior to any Equity Issuance if
it (in the aggregate when combined with all other Equity Issuances of which the
Company did not provide written notice to the Investor) would cause Investor’s
Beneficial Ownership of shares of Company Common Stock to decrease by 1% or more
(as a percentage of the Investor’s Beneficial Ownership of issued and
outstanding shares of the Company Common Stock) (after giving effect to such
issuance). For example, if the Investor’s Beneficial Ownership of shares of
Company Common Stock is 17% prior to any such issuance, then the Company shall
be required to provide notice to the Investor prior to any such issuance that
would cause the Investor’s Beneficial Ownership of shares of Company Common
Stock to decrease by more than 0.17% (1% of 17%).
 
(e)           Upon the Company’s issuance of any Preemptive Rights Shares, such
Preemptive Rights Shares shall be (i) validly issued, fully paid and
nonassessable and (ii) duly authorized by all necessary corporate action of the
Company.
 
(f)           In the event that the Company proposes an issuance of New
Securities (excluding Preemptive Rights Shares pursuant to this Section 2.7)
that is subject to approval by the stockholders of the Company under the NYSE
Rule (a “Stockholder Approved Issuance”) and the full number of Preemptive
Rights Shares that would be issued to the Investor pursuant to Section 2.7(a) in
connection with such
 
 
 
12

--------------------------------------------------------------------------------

 
 
Stockholder Approved Issuance would exceed the amount that the Company could
issue to the Investor without stockholder approval pursuant to the NYSE Rule,
the Company shall, in connection with seeking approval for such Stockholder
Approved Issuance, include in the proxy solicitation relating to such
Stockholder Approved Issuance a separate proposal seeking the approval by the
stockholders of the Company for the issuance to the Investor of the Preemptive
Rights Shares in connection with such Stockholder Approved Issuance; provided,
that the Company shall use the same efforts it uses to seek approval of the
issuance to the Investor of the Preemptive Rights Shares as it uses for the
Stockholder Approved Issuance (it being understood that no Stockholder Approval
Issuance will be conditioned on the receipt of such approval).
 
(g)           “Pre-Issuance Ownership Percentage” means the Investor’s
Beneficial Ownership, expressed as a percentage, of issued and outstanding
shares of the Company Common Stock as of immediately prior to the applicable
issuance of New Securities; provided, that, in the case of a True-up Equity
Issuance, the Investor’s Beneficial Ownership shall be calculated for purposes
of this definition without giving effect to any prior Exempt Equity Issuance or
other issuance of the Company Common Stock for which the Investor did not have
preemptive rights due to the proviso to Section 2.7(a) that was made following
the later of (x) the commencement of the Investor’s rights pursuant to this
Section 2.7 and (y) the last prior True-Up Equity Issuance.
 
ARTICLE III
 
STANDSTILL
 
Section 3.1           Standstill.  From and after the date of this Agreement,
without the prior written consent of the Company Board, the Investor shall not,
and shall not permit any of its Affiliates to, directly or indirectly, alone or
in concert with any individual, corporation, limited liability company,
partnership, association, trust, unincorporated organization, labor union, other
entity or group (as defined by Rule 13d-5 under the Exchange Act) (each, a
“Person”), solicit, encourage, participate in or facilitate any Person in
(including by voting its shares of the Company Common Stock in support of), or
engage in:
 
(a)           any tender or exchange offer for securities of the Company or any
of its subsidiaries, merger, consolidation, business combination or acquisition
or disposition of assets of the Company or any of its Subsidiaries, or any other
actions that would or would reasonably be expected to result in a Change of
Control (as hereinafter defined);
 
(b)           the nomination for election, or election, of any individual as a
director of the Company, other than as contemplated by Section 5.2 hereof and
any such individual nominated by the Company Board or the applicable committee
thereof;
 
(c)           any recapitalization, restructuring, liquidation, dissolution or
other similar extraordinary transaction with respect to the Company or any of
its Subsidiaries;
 
 
 
13

--------------------------------------------------------------------------------

 
 
(d)           the acquisition of, or the obtaining of any economic interest in,
any right to direct the voting or disposition of, or any other right with
respect to, any securities (including Company Securities) or other obligations
or any assets of the Company or any of its Subsidiaries;
 
(e)           forming, joining or in any way participating in a “partnership,
limited partnership, syndicate, or other group” (within the meaning of
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act) for purposes of
acquiring, holding, voting or disposing of any securities of the Company;
 
(f)           disposition of any Shares in response to an unsolicited tender
offer for securities of the Company or other proposed offer or business
combination, except as otherwise provided in Section 4.1;
 
(g)           any act or proposal to seek additional representation on the
Company Board;
 
(h)           any action (including any public announcement or communication
with or to the Company) that would reasonably be expected to require the Company
to make a public announcement regarding any of the types of matters set forth in
this Section 3.1; or
 
(i)           any act or proposal to seek to amend or obtain a waiver of any of
the foregoing (the restrictions set forth in the foregoing clauses (a) through
(i), the “Standstill Restrictions”);
 
provided, however, that the Standstill Restrictions shall be suspended and none
of them shall apply at any time that the Investor ceases to Beneficially Own 3%
or more of the issued and outstanding shares of the Company Common Stock.
 
Section 3.2           Standstill Exceptions.  Notwithstanding anything in
Section 3.1 to the contrary, the Investor shall be permitted to acquire
Beneficial Ownership of up to 20% of the issued and outstanding shares of the
Company Common Stock at any time; provided, however, that in no event shall the
Investor acquire shares of the Company Common Stock if such acquisition would
result in the Investor having Beneficial Ownership of shares of the Company
Common Stock in excess of the Ownership Limit.
 
Section 3.3           Standstill Fall-Away.  Except as otherwise provided in
Section 5.2, the Standstill Restrictions shall terminate upon the occurrence of
any of the following events (each, a “Standstill Fall-Away Date”):
 
(a)           any Person, other than: (i) the Company, (ii) a trustee or other
fiduciary holding voting securities of the Company under an employee benefit
plan of the Company, (iii) an underwriter temporarily holding voting securities
of the Company pursuant to an offering of such securities, or (iv) a Person
owned, directly or indirectly, by the security holders of the Company in
substantially the same proportions as their
 
 
 
14

--------------------------------------------------------------------------------

 
 
ownership of voting securities of the Company, is or becomes the Beneficial
Owner, directly or indirectly, of voting securities of the Company representing
more than 50% of the combined voting power of the Company’s then issued and
outstanding voting securities;
 
(b)           the Company consummates a merger, consolidation, share exchange or
other similar transaction (a “Fundamental Transaction”) with any other Person,
other than a Fundamental Transaction in which the voting securities of the
Company that are issued and outstanding immediately prior to such Fundamental
Transaction continue to represent (either by remaining outstanding or by being
converted into voting securities of the surviving or parent entity) at least a
majority of the combined voting power immediately after such Fundamental
Transaction of (i) the Company’s issued and outstanding securities or (ii) the
surviving or parent entity’s issued and outstanding securities;
 
(c)           the security holders of the Company approve a plan of complete
liquidation or winding-up of the Company;
 
(d)           the sale or disposition (in one transaction or a series of related
transactions) of all or substantially all of the Company’s assets is
consummated; or
 
(e)           a change of a majority of the membership of the Company Board
(other than a change approved by a majority of the directors serving on the
Company Board prior to such change) (each event set forth in the foregoing
clauses (a) through (e), with respect to the Company, shall constitute a “Change
of Control”).
 
ARTICLE IV
 
TRANSFERS
 
Section 4.1           Transfer Restrictions.
 
(a)           Without the Company’s prior written consent, the Investor shall
not, directly or indirectly, sell, transfer, offer, give, assign, hypothecate,
pledge, encumber, grant a security interest in or otherwise dispose of (whether
by operation of law or otherwise) (each, a “Transfer”) any Shares or any right,
title or interest therein or thereto; provided, however, that the Investor may,
without the Company’s prior written consent, Transfer Shares (i) at any time
during the Restricted Period (as hereinafter defined) as permitted by and in
accordance with Section 4.2, (ii) at any time after the Restricted Period as
permitted by and in accordance with Section 4.3, (iii) at any time as permitted
by and in accordance with Section 4.7 or pursuant to an Approved Tender Offer, a
Restricted Period Approved Tender Offer or a Subsequent Offering (each as
hereinafter defined), (iv) following a Change of Control or (v) following notice
to the Company (which must be delivered as soon as reasonably practicable), at
any time pursuant to a Regulatory Transfer; provided, further, that, for the
avoidance of doubt, a merger, amalgamation, plan of arrangement or consolidation
or similar business
 
 
15

--------------------------------------------------------------------------------

 
 
 
combination transaction in which the Investor is a constituent corporation (or
otherwise a party including, for the avoidance of doubt, a transaction pursuant
to which a Person acquires all or a portion of the Investor, whether by tender
or exchange offer, by share exchange, or otherwise) shall not be deemed to be a
“Transfer” by the Investor of any Shares or any right, title or interest therein
or thereto.  For purposes of this Agreement: “Approved Tender Offer” shall mean
a tender offer or business combination relating to the issued and outstanding
shares of the Company’s Common Stock that has been approved by the Company Board
following the Restricted Period; “Restricted Period Approved Tender Offer” shall
mean a tender offer or business combination relating to a majority of the issued
and outstanding shares of the Company’s Common Stock that has been approved by
the Company Board during the Restricted Period; “Subsequent Offering” shall mean
any post-closing subsequent offering period of a completed tender offer for at
least a majority of the issued and outstanding shares of the Company’s Common
Stock by any third party so long as a majority of the issued and outstanding
shares of the Company Common Stock have been previously tendered to such third
party and are not subject to withdrawal; and “Restricted Period” shall mean the
period beginning on the date on which the Investor first acquires, through open
market purchases or purchases pursuant to the Option Agreement or both,
Beneficial Ownership of any shares of the Company Common Stock and ending the
date that is the earlier of (a) the third anniversary of the Effective Time or
(b) the termination of the Agreement pursuant to Section 8.1.  For the avoidance
of doubt, Transfers of Shares by the Investor (x) pursuant to an Approved Tender
Offer, a Restricted Period Approved Tender Offer or a Subsequent Offering or
following a Change of Control shall not be subject to the limitations or the
Company’s rights set forth in Section 4.2, Section 4.3, Section 4.4, Section 4.5
or Section 4.6 and (y) pursuant to a Regulatory Transfer shall not be subject to
the limitations or the Company’s rights set forth in Section 4.5 or Section 4.6.
 
(b)           “Regulatory Transfer” means a Transfer by the Investor pursuant to
a Permitted Sale to the extent necessary (i) to comply with applicable Law,
effectively binding written or oral “administrative guidance” from a
Governmental Authority in Japan having competent jurisdiction over the Investor
or its business (“Administrative Guidance”) or an Order by a Governmental
Authority with competent jurisdiction over the Investor or its business
(“Governmental Order”), or (ii) following the Company informing the Investor of
an acquisition or change pursuant to Items (1)(c) and (2) of Schedule 5.3 of the
Disclosure Letter that would or would reasonably be expected to result in the
Investor being in violation of applicable Law in Japan, for the Company to no
longer be deemed to be an affiliate of the Investor under applicable Law in
Japan, and in each case of clauses (i) and (ii), only for the minimum amount of
Shares that would be necessary to comply with such Law, Administrative Guidance
or Governmental Order or for the Company to no longer be deemed to be an
affiliate of the Investor under applicable Law in Japan, as applicable;
provided, that the Investor shall notify the Company in writing about any such
requirement or affiliation issue promptly after the Investor becomes aware of
such requirement or affiliation issue, and, if practicable based on the timing
of the actions required for compliance or disaffiliation, prior to any Transfer
of Shares pursuant to this Section 4.1(b), a Senior Executive (as hereinafter
defined) of the Investor shall discuss with a Senior Executive of the Company
and
 
 
 
16

--------------------------------------------------------------------------------

 
 
consider in good faith alternatives for complying with such Law, Administrative
Guidance or Governmental Order or remedying such affiliation issue without
disposing of Shares.  As used herein, “Senior Executive” means, with respect to
the Company, the Chief Executive Officer or Chief Financial Officer, and with
respect to the Investor, one of the two most senior executive officers in charge
of the Investor’s asset management business, who shall initially be the
individuals set forth on Schedule 4.1(b) of the Disclosure Letter.  Schedule
4.1(b) of the Disclosure Letter shall be updated from time to time by the
Investor to provide the then-current names and titles of such senior executive
officers in the event of any change.
 
Section 4.2           Permitted Transfers During Restricted
Period.  Notwithstanding anything to the contrary contained in this Article IV
(other than Section 4.1), during the Restricted Period, the Investor may
Transfer all or a portion of its Shares solely by means of one or a series of
(x) Permitted Affiliate Sales or (y) Permitted Non-Public Transfer or Permitted
Public Transfer (together with Permitted Affiliate Sales, “Permitted Sales”)
(subject to the Company’s rights set forth in Section 4.4 (if applicable) and
Section 4.5), and, with respect to this clause (y) only:
 
(a)           if an Event of Financial Distress shall occur with respect to the
Company or the Investor; provided that, the Investor shall notify the Company in
writing about any such event after the Investor becomes aware of such event,
and, prior to any Transfer of its Shares a Senior Executive of the Investor’s
management shall discuss with a Senior Executive of the Company’s management and
consider in good faith alternatives to a Transfer of its Shares; or
 
(b)           if an Insolvency Event shall occur with respect to the Company or
the Investor.
 
Section 4.3           Permitted Transfers After the Restricted
Period.  Notwithstanding anything to the contrary contained in this Article IV
(other than Section 4.1), after the Restricted Period, the Investor may Transfer
all or a portion of its Shares only by means of one or a series of Transfers:
 
(a)           to (i) any wholly-owned Subsidiary of the Investor, (ii) any
Person of which the Investor is a wholly-owned Subsidiary (an “Investor Parent”)
or (iii) any wholly-owned Subsidiary of any Investor Parent, in each case of the
foregoing clauses (i), (ii) and (iii), if, prior to such Transfer, such
transferee (an “Affiliated Transferee”) agrees pursuant to a written instrument
in form and substance reasonably acceptable to the Company to (x) be bound by
the obligations of the Investor under this Agreement as in effect immediately
prior to such Transfer (which, however, shall not relieve the Investor of its
obligations under this Agreement) and (y) Transfer all of the Shares that the
Investor (or relevant Affiliated Transferee) has previously Transferred to such
Affiliated Transferee back to the Investor in the event that such Affiliated
Transferee ceases to be a wholly-owned Subsidiary of the Investor, an Investor
Parent or a wholly-owned Subsidiary of any Investor Parent (and, in such event,
the Investor shall cause such Transfer back to be effected) (each such
transaction a “Permitted Affiliate Sale”);
 
 
 
17

--------------------------------------------------------------------------------

 
 
 
(b)           (i)  not requiring registration under the Securities Act of 1933,
as amended (the “Securities Act”) or (ii) involving any block trade pursuant to
an exercise of registration rights of the Investor, in each case, to any Person
who, together with its Affiliates, would not, to the knowledge of the Investor
after reasonable inquiry, after giving effect to the Transfer, Beneficially Own
5% or more of the issued and outstanding shares of the Company Common Stock (or
other applicable securities) (a “Permitted Non-Public Transfer”, it being
understood and agreed that a Permitted Affiliate Sale shall not constitute a
Permitted Non-Public Transfer); provided, that the Investor may, with the
Company’s prior written consent, make a Permitted Non-Public Transfer of Shares
to a Person who, together with its Affiliates, would, after giving effect to
such Permitted Non-Public Transfer, Beneficially Own 5% or more of the issued
and outstanding shares of the Company Common Stock (or other applicable
securities); or
 
(c)           to the general public that (i) is effected through a public stock
exchange or electronic market based within the United States (A) pursuant to a
Registration Statement (as defined in Exhibit C) filed by the Company with the
SEC that is declared effective under the Securities Act or (B) pursuant to Rule
144 (if then applicable) or under any successor rule thereof under the
Securities Act and (ii) otherwise complies with all applicable Laws (a
“Permitted Public Transfer”); provided, that, in any Permitted Public Transfer,
the Investor (x) shall use commercially reasonable efforts to effect as wide a
distribution of Shares as is reasonably practicable and (y) shall not, without
the Company’s prior written consent, Transfer Shares in any Permitted Public
Transfer to any Person who, to the knowledge of the Investor, after giving
effect to the Permitted Public Transfer, Beneficially Owns 5% or more of the
issued and outstanding shares of the Company Common Stock (or other applicable
securities).
 
Section 4.4           Volume Limitation.  Notwithstanding anything in this
Article IV to the contrary (other than Section 4.1), the Investor shall not,
without the Company’s prior written consent, Transfer pursuant to a Permitted
Public Transfer, on any single day (other than in connection with an
underwritten public offering), a number of Shares that in the aggregate exceeds
10% of the average daily trading volume of shares of the Company Common Stock
(or other applicable securities) during a period of thirty (30) trading days
immediately preceding the date of such Transfer.
 
Section 4.5           Right of First Refusal.
 
(a)           Before any Shares may be Transferred by the Investor pursuant to a
Permitted Non-Public Transfer, the Investor shall deliver a written notice (a
“ROFR Notice”) to the Company, which shall confirm the Investor’s bona fide
intention to Transfer Shares (such shares, the “ROFR Shares”) in a Permitted
Non-Public Transfer and shall set forth, with respect to such Permitted
Non-Public Transfer, in reasonable detail:  (i) the identity of the Person or
Persons to whom the Investor intends to Transfer such ROFR Shares (the
“Identified Transferees”); (ii) the number of ROFR Shares that the Investor
intends to Transfer; (iii) the price per share (expressed as a value in U.S.
dollars or as a price relative to the market price) of the ROFR Shares (the
“ROFR Price”); and (iv) all other material terms and conditions of such
Permitted Non-Public Transfer
 
 
 
18

--------------------------------------------------------------------------------

 
 
(the “ROFR Terms”).  The delivery of the ROFR Notice shall be evidence of the
Investor’s irrevocable offer to Transfer to the Company all of the ROFR Shares
for the ROFR Price and subject to the ROFR Terms.
 
(b)           During the period of ten (10) Business Days following the receipt
of the ROFR Notice by the Company (the “ROFR Exercise Period”), the Company
shall have the right to purchase all of the ROFR Shares for the ROFR Price per
share and subject to the ROFR Terms, and the consummation of the sale and
purchase of the ROFR Shares shall occur at the time that the Company and the
Investor shall reasonably establish by mutual agreement which time shall be not
more than twenty (20) Business Days following the end of the ROFR Exercise
Period.  To exercise the right to purchase the ROFR Shares, the Company must
timely deliver written notice to the Investor within the ROFR Exercise Period
confirming the Company’s irrevocable commitment to purchase all of the ROFR
Shares for the ROFR Price and subject to the ROFR Terms.  At the closing of the
Transfer of the ROFR Shares from the Investor to the Company, (i) the Investor
shall Transfer to the Company the ROFR Shares free and clear of all liens and
encumbrances and shall deliver to the Company such other documents and
instruments evidencing or otherwise relating to such Transfer as the Company
reasonably may request, and (ii) the Company shall deliver to the Investor by
wire transfer or bank check of immediately available funds an amount of cash in
U.S. dollars for the payment in full for such ROFR Shares.
 
(c)           If the Company does not, prior to the end of a ROFR Exercise
Period, exercise its right under this Section 4.5 to purchase the applicable
ROFR Shares from the Investor for the ROFR Price per share and subject to the
ROFR Terms, the Investor shall have the right, during a period of twenty (20)
Business Days following the end of the ROFR Exercise Period (the “ROFR Open
Period”), subject to the terms and conditions of this Agreement (including
Section 4.4), to complete a Transfer of all of the ROFR Shares to an Identified
Transferee for a price that is not less than the ROFR Price per share and
subject to material terms and conditions that are not less favorable in any
material respect to the Investor than the ROFR Terms.  If the Investor desires
to Transfer any ROFR Shares following the end of the ROFR Open Period or if the
Investor desires to Transfer any ROFR Shares in a Permitted Non-Public Transfer
at any time (i) to any Person other than an Identified Transferee, (ii) for a
price that is less than the ROFR Price per share or (iii) subject to material
terms and conditions that are less favorable in any material respect to the
Investor than the ROFR Terms, then the Investor shall be required to comply with
the procedures set forth under this Section 4.5 again by delivering a new ROFR
Notice to the Company and provide the Company with another ROFR Exercise Period
during which the Company may elect to purchase ROFR Shares for the price per
share, and subject to the material terms and conditions, indicated by such new
ROFR Notice.
 
Section 4.6           Right of First Offer.  Before any Shares may be
Transferred by the Investor pursuant to a Permitted Public Transfer (excluding
any Transfer pursuant to paragraph (d) of Exhibit C), the Investor shall deliver
a written notice (a “ROFO Notice”) to the Company, which shall confirm the
Investor’s bona fide intention to
 
 
 
19

--------------------------------------------------------------------------------

 
 
Transfer Shares (such shares, the “ROFO Shares”) in a Permitted Public
Transfer.  During the period of ten (10) Business Days following the delivery of
the ROFO Notice to the Company (the “ROFO Negotiation Period”), the Investor
shall, if so requested by the Company, negotiate exclusively with the Company in
good faith with respect to a transaction in which the Investor shall Transfer
all or a portion of the ROFO Shares to the Company, in lieu of an effective
Permitted Public Transfer for such ROFO Shares.  For the avoidance of doubt, the
Investor shall not have any obligation to Transfer any ROFO Shares to the
Company, and the Company shall not have any obligation to purchase any ROFO
Shares from the Investor, unless the Company and the Investor mutually agree to
such a transaction in writing.  If, following the expiration of the ROFO
Negotiation Period, the Company and the Investor have not agreed in writing for
the Investor to Transfer all or a portion of the ROFO Shares to the Company,
then the Investor shall have the right, during a period of six (6) months
following the end of the ROFO Negotiation Period (the “ROFO Open Period”),
subject to the terms and conditions of this Agreement (including Section 4.4),
to Transfer all of the ROFO Shares in a Permitted Public Transfer; provided,
however, that (x) if the ROFO Shares are comprised of the Registrable Shares (as
defined in Exhibit C), and (y) if the Investor demands, pursuant to the
Registration Rights, a registration of such ROFO Shares or the filing of a
Prospectus Supplement (as defined in Exhibit C) with respect to such ROFO Shares
during the ROFO Open Period, then the ROFO Open Period shall end six (6) months
following the effectiveness of the applicable Registration Statement or
Prospectus Supplement filed by the Company pursuant to or as contemplated by
Exhibit C.  If the Investor desires to Transfer any ROFO Shares following the
end of the ROFO Open Period in a Permitted Public Transfer, then the Investor
shall be required to comply with the procedures set forth under this Section 4.6
again by delivering a new ROFO Notice to the Company and provide the Company
with another ROFO Negotiation Period pursuant to this Section 4.6.
 
Section 4.7           Mandatory Transfers.
 
(a)           If the Company engages in any share repurchase program or
self-tender (a “Company Repurchase Event”) that would cause the Investor to
Beneficially Own shares of the Company Common Stock in excess of the Ownership
Limit, then the Investor shall (x) be given the opportunity to participate in
such Company Repurchase Event on the same terms and conditions as other
stockholders of the Company and (y) Transfer such number of Shares to the
Company as may be permitted pursuant to the terms of such Company Repurchase
Event as shall be necessary to reduce the Investor’s Beneficial Ownership of
Shares to the Ownership Limit; provided, that to the extent such Transfer to the
Company does not permit the Investor to reduce the Investor’s Beneficial
Ownership of Shares to the Ownership Limit, the Investor shall, as promptly as
practicable, Transfer such additional number of Shares pursuant to a Permitted
Non-Public Transfer or a Permitted Public Transfer as shall be necessary to
reduce the Investor’s Beneficial Ownership of Shares to the Ownership Limit, in
each case without being subject to Section 4.4, Section 4.5 and
Section 4.6.  Notwithstanding the foregoing, if such Company Repurchase Event
would not cause the Investor to Beneficially Own
 
 
 
20

--------------------------------------------------------------------------------

 
 
more than 22% of the issued and outstanding shares of the Company Common Stock,
then, during a period of sixty (60) calendar days following the date on which
the Investor’s Beneficial Ownership of shares of the Company Common Stock first
exceeds the Ownership Limit due to such Company Repurchase Event, the Investor
may, in lieu of Transferring the applicable Shares to the Company pursuant to
the terms of such Company Repurchase Event, Transfer such number of Shares
pursuant to a Permitted Non-Public Transfer or a Permitted Public Transfer as
shall be necessary to reduce the Investor’s Beneficial Ownership of Shares to
the Ownership Limit, in each case without being subject to Section 4.4,
Section 4.5 and Section 4.6. The Company shall promptly (but in no event less
than ten (10) Business Days prior to the occurrence of the applicable event)
notify the Investor thereof that a Company Repurchase Event is expected to cause
the Beneficial Ownership of the Investor to increase above the Ownership Limit
and inform the Investor of the terms of such Company Repurchase Event.
 
(b)           If at any time, other than as a result of a Company Repurchase
Event, the Investor Beneficially Owns more than the Ownership Limit of the
issued and outstanding shares of the Company Common Stock, the Investor shall,
as promptly as practicable and subject to Section 4.5 and Section 4.6, transfer
such number of Shares pursuant to a Permitted Non-Public Transfer or a Permitted
Public Transfer as shall be necessary to reduce the Investor’s Beneficial
Ownership of Shares to the Ownership Limit; provided, that any such Transfer
shall not be deemed to be a waiver by the Company of, or otherwise relieve the
Investor of liability for, or the consequences of, any breach of this Agreement
that may be found to have existed on account of the Investor’s Beneficial
Ownership of Shares in excess of the Ownership Limit.
 
Section 4.8           Related Parties.  For each of the Investor’s Affiliates
that Beneficially Owns Company Securities (including shares of the Company
Common Stock) that the Investor is also deemed to Beneficially Own for purposes
of this Agreement, the Investor shall cause such Affiliate to comply fully with
Section 2.1, Section 2.5, Section 3.1, Section 3.2 and Article IV as if such
Affiliate were the Investor; provided, that such provisions shall not be
applicable to securities held by the Investor or its Affiliates on behalf of
third party clients for which the Investor or its Affiliates do not have
Beneficial Ownership.
 
ARTICLE V
 
GOVERNANCE AND INVESTOR RIGHTS
 
Section 5.1           Voting.  Subject to the terms and conditions hereof, the
Investor and each Affiliated Transferee shall be entitled to vote its Shares in
its sole discretion; provided, that without limiting the foregoing rights the
Investor shall, and shall cause each Affiliated Transferee to, consider in good
faith the views and recommendations of the Company Board on matters to be voted
on by the Company Shareholders.
 
 
 
 
21

--------------------------------------------------------------------------------

 
 
Section 5.2           Board of Directors.
 
(a)           Upon request of the Investor, in accordance with the terms of this
Agreement, the Company Board has determined to invite the Investor to, and the
Investor shall have the right (until such right is terminated in accordance with
the terms of this Agreement) to, designate a representative of the Investor for
appointment to the Company Board (the “Investor Representative”), subject to the
following procedures and conditions:  During the period beginning on the
Effective Time and ending upon termination of the Designation Right pursuant to
Section 5.2(c), the Investor shall have the right (exercisable immediately or at
any time thereafter) to designate an Investor Representative, which right shall
include the right to request that the Investor Representative resign from the
position and to designate a replacement Investor Representative upon any
resignation, retirement or other removal of any Investor Representative (such
right, the “Designation Right”).  Promptly at the request of the Investor
following the Effective Time, the Company Board shall increase the number of
directors on the Company Board by one and appoint the Investor Representative to
the Company Board.  Thereafter, upon the resignation, retirement or other
removal of any Investor Representative, the Company Board shall promptly appoint
the replacement Investor Representative to the Company Board.  Each Investor
Representative must satisfy any regulatory requirements applicable to directors
or director nominees to the Company Board and shall be subject to all policies
applicable to directors of the Company, including the Company’s Corporate
Governance Guidelines.  In connection with each proposed Investor Representative
to the Company Board, the Investor shall provide such information with respect
to such designee as may be required by applicable Law or regulation or otherwise
reasonably requested by the Company.   Each Investor Representative and each
replacement Investor Representative must be reasonably acceptable to the Company
and the Company Board as the obligation of the Company Board to appoint or
nominate any such individual shall, with respect to each such individual, be
subject to compliance by each director with such director’s fiduciary
duties.  Prior to termination of the Designation Right pursuant to
Section 5.2(c) and subject to the requirements of this Section 5.2(a), if an
Investor Representative is appointed to the Company Board pursuant to this
Section 5.2(a), the Company shall include such Investor Representative (or
designated replacement Investor Representative in accordance with this Section
5.2) as a nominee to the Company Board on the slate of nominees recommended by
the Company Board in the Company’s proxy statement and on its proxy card
relating to each annual or other meeting where directors are to be elected by
shareholders of the Company.  Prior to termination of the Designation Right
pursuant to Section 5.2(c), the Company shall use the same efforts to have the
Investor Representative elected as a director of the Company by the stockholders
of the Company and shall solicit proxies for the Investor Representative to the
same extent as it does for any other nominees recommended by the Company
Board.  Prior to appointment or election to the Company Board, each Investor
Representative shall provide a written letter of resignation, effective upon and
conditioned on the occurrence of a termination of the Designation Right pursuant
to Section 5.2(c).
 
 
 
22

--------------------------------------------------------------------------------

 
 
(b)           The Investor Representative shall have the same rights and
responsibilities as other members of the Company Board, including the same
access as other members of the Company Board to management with respect to
matters relating to the operation, financial and all other policies of the
Company (and the ability to participate in the processes by which those policies
are made) and the same rights as other members of the Company Board to attend
committee meetings of the Company Board.  The Investor Representative shall be
provided with copies of all notices, minutes, consents and other materials
provided to all other members of the Company Board concurrently to when such
materials are provided to such other members.
 
(c)           The Company may terminate the Designation Right by written notice
to the Investor within thirty (30) Business Days (subject to the proviso in
sub-clause (vi)) after: (i) the Parties agree in writing to terminate the
Designation Right, (ii) the Designation Right or the exercise thereof by the
Investor or participation by the Investor Representative on the Company Board is
prohibited by applicable Law or pursuant to an Order by a Governmental Authority
with competent jurisdiction over the Company or Investor, (iii) the Investor
commits a material breach of this Agreement, which material breach is not cured
within thirty (30) calendar days after the Investor’s receipt of a written
notice in respect thereof from the Company, (iv) the Investor fails to maintain
the level of Invested Assets, or fails to maintain the level of Seed Capital
Investments, in each case as contemplated by, and in accordance with the funding
schedule set forth in, Schedule 6.1(i) of the Disclosure Letter, which failure
is, in each case, not cured within twenty (20) calendar days following written
notice by the Company, it being understood that in no event shall the aggregate
cure period granted with respect to all failures to maintain such funding levels
and schedules pursuant to this clause (iv) exceed forty (40) calendar days in
any calendar quarter (for the avoidance of doubt, the temporary redemption or
repatriation of funds by the Investor in accordance with Section 6.1(f) shall
not be deemed to be a material failure to maintain the required investment
levels unless such funds are not reinvested in accordance with Section 6.1(f)),
(v) the Investor has delivered a written notice pursuant to Section 6.1(h) of
its intention not to comply with the Invested Asset and/or Seed Capital
Investment funding and maintenance requirements of Schedule 6.1(i) of the
Disclosure Letter, or (vi) if at any time following the Effective Time the
Investor Beneficially Owns less than 15% of the Company Common Stock (provided,
that in the case of a termination of the Designation Right pursuant this
sub-clause (vi), if at such time the Investor has the right to terminate this
Agreement pursuant to Section 8.1(l), then the Company may not exercise its
right to terminate the Designation Right until ninety (90) calendar days
following the event described in this sub-clause (vi), at which time, if the
event shall be continuing, then the Company shall be permitted to deliver notice
of termination hereunder).  Failure to give the notice referred to in the
preceding sentence shall constitute a waiver of the Company’s right to terminate
the Designation Right in connection with the applicable event.  Prior to any
termination of the Designation Right pursuant to sub-clauses (ii) – (vi), a
Senior Executive of the Company shall discuss such termination of the
Designation Right with a Senior Executive of the Investor and consider in good
faith whether there are available alternatives or remedies to avoid terminating
the Designation Right.
 
 
 
23

--------------------------------------------------------------------------------

 
 
(d)           The Designation Right shall automatically terminate ten (10)
Business Days following written notice from the Company to the Investor that a
Change of Control has occurred; provided, however, that if the Designation Right
would not otherwise terminate pursuant to this Section 5.2(d) in connection with
such Change of Control, then the Investor may, within ten (10) Business Days
following its receipt of such notice of a Change of Control, elect in writing to
continue the Designation Right, and the Designation Right shall not be
terminated following such Change of Control.  If the Investor elects, pursuant
to this Section 5.2(d), to continue the Designation Right following a Change of
Control, then no Standstill Fall-Away Date shall be deemed to have occurred as a
result of such Change of Control, and the Standstill Restrictions shall continue
to apply until a subsequent Standstill Fall-Away Date.  The Company shall give
written notice to the Investor that a Change of Control has occurred within five
(5) Business Days following such occurrence.
 
Section 5.3           Information Rights.  The Investor and the Company shall
share certain information and coordinate on certain financial reporting and
other related matters pursuant to the terms set forth on Schedule 5.3 of the
Disclosure Letter  (the “Information Rights”).
 
Section 5.4           Confidentiality.  No non-public information received by or
provided to any Party (the “Receiving Party”) pursuant to this Agreement
(including without limitation pursuant to Schedule 5.3 and Schedule 6.1(ii) of
the Disclosure Letter), including any non-public information concerning the
Company or the Investor or their respective businesses, operations, plans and
prospects, may be directly or indirectly (x) disclosed, in whole or in part, or
summarized, excerpted from or otherwise referred to, by the Receiving Party or
(y) used by the Receiving Party for purposes not contemplated by this Agreement,
in each case, without the other Party’s prior written consent.  Notwithstanding
anything in this Section 5.4 to the contrary:  (i) to the extent required by
applicable Law, a Receiving Party may disclose such non-public information
without the other Party’s prior written consent; provided that, to the extent
permitted by applicable Law, such Receiving Party shall (A) give such other
Party prompt prior written notice of such requirement and (B) reasonably
cooperate with such other Party to seek a protective order or other appropriate
remedies to obtain assurance that confidential treatment will be accorded such
non-public information; and (ii) a Receiving Party may disclose such non-public
information to its directors, officers, employees, accountants, counsel and
other representatives (collectively, “Representatives”) to the extent any such
Person needs to know such information in connection with the Receiving Party’s
rights and obligations under this Agreement; provided that (A) such Receiving
Party shall inform any such Representatives of the confidentiality obligations
contained in this Section 5.4, and (B) such Receiving Party shall be responsible
for any breach of any such obligations by any such
Representative.  Notwithstanding the foregoing, if any non-public information is
disclosed by the Company to the Investor pursuant to Item (4) of Schedule 5.3 of
the Disclosure Letter, such information shall not be disclosed to any
Governmental Authority (other than on a confidential basis), any other third
party or publicly by the Investor prior to the Company’s public disclosure of
such information (provided, that the Investor shall
 
 
 
24

--------------------------------------------------------------------------------

 
 
consult in good faith with the Company regarding the appropriate form and timing
of the Investor’s disclosure of such information).  Except as required by
applicable Law, the term “non-public information” as used in this Section 5.4
shall not include information that: (1) at the time of disclosure is, or
thereafter becomes, generally available and known to the public other than as a
result of, directly or indirectly, any violation of this Section 5.4 by the
Receiving Party or any of its Representatives; (2) at the time of disclosure is,
or thereafter becomes, available to the Receiving Party on a non-confidential
basis from a third-party source, provided that such third party is not and was
not prohibited from disclosing such non-public information to the Receiving
Party by a legal, fiduciary or contractual obligation to the disclosing Party;
(3) was known by or in the possession of the Receiving Party or its
Representatives, as established by documentary evidence, prior to being
disclosed by or on behalf of the disclosing Party; or (4) was or is
independently developed by the Receiving Party, as established by documentary
evidence, without reference to or use of, in whole or in part, any of the
disclosing Party’s non-public information.  The obligations of any Receiving
Party under this Section 5.4 shall survive any termination of this Agreement
until the third anniversary of the date of termination.
 
Section 5.5           Registration Rights.  Exhibit C hereto sets forth the
agreement of the Investor and the Company regarding the registration rights of
the Investor (the “Registration Rights”), and is incorporated herein by
reference as if set forth herein.
 
ARTICLE VI
 
ASSET MANAGEMENT AND STRATEGIC COOPERATION
 
Section 6.1           Management of the Investor’s Assets.
 
(a)           No later than the date that is two (2) calendar months following
the date hereof (the “Initial Funding Date”), the Investor shall cause cash in
the amount of at least $300,000,000 (the “Initial Investment”) to be invested in
investment products of the Company or its Affiliates, in accordance with the
provisions of Schedule 6.1(i) of the Disclosure Letter.  The Investor shall
cause the balance of the $2,000,000,000 in excess of the Initial Investment and
the other investments by the Investor in investment products of the Company or
its Affiliates as of the date of this Agreement (as set forth in Schedule 6.1(i)
of the Disclosure Letter) to be invested in investment products of the Company
or its Affiliates in accordance with the provisions of Schedule 6.1(i) of the
Disclosure Letter.  Subject to the funding schedule set forth in Schedule 6.1(i)
of the Disclosure Letter, and the other terms and conditions of Schedule 6.1(i)
of the Disclosure Letter, and subject to Section 6.1(f) and Section 6.1(h), the
aggregate amount allocated and maintained in investment products of the Company
and its Affiliates during the term of this Agreement will not be less than
$2,000,000,000 (with such amount determined without giving effect to changes in
market value or investment performance).  The assets invested by the Investor
pursuant to Section 6.1(a) (the “Invested Assets”) shall be initially invested
in the investment products and on the schedule, in each case as set forth
 
 
 
25

--------------------------------------------------------------------------------

 
 
in Schedule 6.1(i) of the Disclosure Letter, which is incorporated herein by
reference as if set forth herein.  Without limiting the obligation of the
Investor to maintain the investment levels required by this Section 6.1(a), the
parties acknowledge that each individual investment shall be subject to approval
by the Investor, acting reasonably and in good faith.
 
(b)           Investor shall at any time prior to termination of this Agreement
and following consultation with the Company have the right to require the
Company to change the allocation set forth in Schedule 6.1(i) of the Disclosure
Letter (prior to investment) and the allocation of the Invested Assets (after
investment) between Company investment products upon thirty (30) days’ advance
written notice to the Company.
 
(c)           The Investor shall invest a portion of the Invested Assets of not
less than $120,000,000 (with such amount determined without giving effect to
changes in market value or investment performance) as seed capital funding into
newly developed products, products under development or existing products of the
Company or its Affiliates that require additional assets to permit effective
distribution to partners and clients, as designated from time to time by the
Company (“Seed Capital Investments”), in accordance with the provisions of
Schedule 6.1(i) of the Disclosure Letter.  The Investor shall use commercially
reasonable efforts to allocate and maintain such seed capital funding of at
least $30,000,000 (with such amount determined without giving effect to changes
in market value or investment performance) in up to four (4) Seed Capital
Investments designated by the Company from time to time, at least until the
earlier of the establishment of a three-year investment performance record for
the applicable investment product or the achievement of a minimum dollar amount
invested in such investment product as determined in good faith by the Company,
after which time, subject to Section 6.1(d), such seed capital funding may be
moved to a new Seed Capital Investment designated by the Company.
 
(d)           Each individual Seed Capital Investment shall be subject to
approval by the Investor, acting reasonably and in good faith with a view to
achieving the full allocation of the $120,000,000 in Seed Capital Investments in
accordance with the schedule set forth in Schedule 6.1(i) of the Disclosure
Letter.  With the prior written consent of the Investor, the Company may from
time to time reallocate the initial Seed Capital Investments set forth in
Section 6.1(c) to other Seed Capital Investment initiatives of the
Company.  From time to time, the Company may also propose additional Seed
Capital Investments in excess of the $120,000,000 minimum investment.  The
Investor shall consider reasonably and in good faith any such requests for
reallocation or additional investments.
 
(e)           In addition to and without limiting the regular course investment
reporting procedures such as monthly performance measurements and quarterly
reviews for the applicable Company investment products, which will start from
the inception of the investment, Investor shall commence monthly evaluation of
the performance of Invested Assets (including Seed Capital Investments)
commencing on the first
 
 
26

--------------------------------------------------------------------------------

 
 
 
anniversary of the initial funding of the applicable Invested Assets (including
Seed Capital Investments) in an applicable Company investment product.  The
Investor’s evaluation of such Invested Assets (including Seed Capital
Investments) shall be effected in accordance with the applicable procedures of
Schedule 6.1(ii) of the Disclosure Letter.  In addition, the Company shall
provide the Investor with quarterly updates regarding the Seed Capital
Investments.  Such updates shall be in such format and contain such information
as the Company and the Investor shall mutually determine, it being understood
that such updates shall address, without limitation, investment performance,
investor inflows and outflows with respect to the applicable investment product
and comments on upcoming funds and repatriations, if applicable.
 
(f)           In the event that Invested Assets (including Seed Capital
Investments) are deemed to be experiencing “Significantly Poor Performance”
based on the evaluation of such Invested Assets effected in accordance with the
applicable procedures of Schedule 6.1(ii) of the Disclosure Letter, the
Investor shall first reallocate such funds to other investment products of the
Company or its Affiliates selected from investment products identified by the
Company in writing from time to time that meet the Investor’s bona fide
investment criteria and standards (“Eligible Investments”), if any such products
are available at such time; however,  if there are no Eligible Investments
available at such time, then the Investor shall have the right to redeem or
repatriate such funds (such date of redemption or repatriation, the “Temporary
Redemption Date”).  For so long as any such funds remain redeemed or
repatriated, the Investor shall use commercially reasonable efforts to review
the investment products of the Company or its Affiliates to identify Eligible
Investments to reinvest its funds.  If such funds are not fully reallocated or
funded into other investment products of the Company or its Affiliates (whether
or not any such products constitute an Eligible Investment) within ninety (90)
days following the Temporary Redemption Date, the Company shall be entitled to
terminate the Designation Right pursuant to Section 5.2(c).
 
(g)           The Investor shall compensate the Company or its applicable
Affiliate for the management of the Invested Assets:
 
(i)           in the case of Invested Assets other than Seed Capital
Investments, at fees not higher than those the Company or its Affiliates
generally charge clients (with a similar investment amount to that of the
Investor) for sub-advised accounts in the applicable investment product or in
other investment products with a similar strategy; 
 
(ii)          in the case of the initial $120,000,000 of Seed Capital
Investments (the “Initial Seed Capital Investments”), at fees as separately
agreed by the Company and the Investor prior to the date hereof (the “Initial
Seed Capital Investment Fees”); and 
 
(iii)         in the case of Seed Capital Investments other than the Initial
Seed Capital Investments, at fees determined by the Company and the Investor
 
 
 
27

--------------------------------------------------------------------------------

 
 
using a methodology consistent with that used in determining the Initial Seed
Capital Investment Fees.
 
If the Company introduces new products with materially higher fee levels than
those for comparable products in the industry, the Investor shall not be
required to allocate Invested Assets into such products (and such products shall
not be included in any list of Eligible Investments).  Without limiting the
obligation of the Investor to maintain the investment levels required by Section
6.1(a), the parties acknowledge that the management by the Company or its
applicable Affiliate of Invested Assets in any product shall be governed by the
terms and conditions of an investment management agreement for each investment
that shall be agreed to and entered into by the parties prior to each
investment.
 
(h)           Notwithstanding the provisions of this Section 6.1, the Investor
shall be permitted to elect not to comply with the Invested Asset and/or Seed
Capital Investment funding and maintenance requirements of Schedule 6.1(i) of
the Disclosure Letter, by delivering written notice of such election to the
Company, in each case:
 
(i)           to the extent that the Investor and the Company otherwise mutually
agree in writing;
 
(ii)          to the extent necessary to comply with applicable Law,
Administrative Guidance or a Governmental Order; provided, that the Investor
shall notify the Company in writing about any such requirement promptly after
the Investor becomes aware of such requirement, and, if practicable based on the
timing of the actions required for compliance, prior to any reduction in
Invested Assets and/or Seed Capital Investments pursuant to this
Section 6.1(h)(ii), a Senior Executive of the Investor shall discuss with a
Senior Executive of the Company and consider in good faith alternatives for
complying with such Law, Administrative Guidance or Governmental Order without a
reduction in Invested Assets and/or Seed Capital Investments;
 
(iii)         from and after the consummation of a Change of Control;
 
(iv)         if an Event of Financial Distress with respect to the Investor or
the Company shall occur; provided, that the Investor shall notify the Company in
writing about any such event after the Investor becomes aware of such event,
and, prior to any reduction in Invested Assets and/or Seed Capital Investments
pursuant to this Section 6.1(h)(iv), a Senior Executive of the Investor shall
discuss with a Senior Executive of the Company and consider in good faith
alternatives to reducing the Invested Assets and/or Seed Capital Investments;
 
(v)          from and after an Insolvency Event with respect to the Investor or
the Company; or
 
(vi)         if this Agreement is terminated pursuant to Section 8.1.
 
 
 
28

--------------------------------------------------------------------------------

 
 
Section 6.2           Coordination Committee.  As promptly as reasonably
practicable following the assignment or secondment of the management level
representative from the Investor referenced in Section 6.5, the Company and the
Investor shall form a committee (the “Coordination Committee”) consisting of
representatives from each of the Company and the Investor.  The representatives
of the Company and the representatives of the Investor, respectively, shall have
equal say in any Coordination Committee matters and a representative of the
Company and a representative of the Investor shall serve as co-chairs of the
Coordination Committee.  Either party may propose the agenda for Coordination
Committee meetings, which will be finalized by the co-chairs of the Coordination
Committee and circulated to the Coordination Committee in advance of each
meeting.  The Coordination Committee shall report to and be subject to the
oversight of the Company’s Executive Committee (the “Executive Committee”),
shall meet (in person or by telephone, videoconference or other electronic
means) not less frequently than once each calendar quarter and shall serve as
the official forum of the Company and the Investor for discussing matters
relating to the distribution, marketing and cross-selling of the Company’s
products in Japan through DIAM distribution channels, inclusive of existing
assets in DIAM Global High Yield Account and DIAM Global Research Account (the
“DIAM Channel Sales”), the opportunities and platforms for DIAM to offer its
products in the United States that do not compete with the Company’s products,
and other matters generally related to the strategic alliance.  Not less
frequently than once each calendar quarter, the Coordination Committee shall,
among other things, (a) establish and/or revise specific sale and revenue
targets for the DIAM Channel Sales for each of the four (4) calendar quarters
immediately following such calendar quarter (such initial targets are provided
in Section 6.3) and (b) deliver a report that is approved by the representatives
of the Company and the Investor to the Executive Committee describing, in
reasonable detail, any progress with respect to the DIAM Channel Sales and, if
requested by the Executive Committee or the Investor, the status of other
matters relating to the alliance between the Company and the Investor.
 
Section 6.3           Japan Sales Targets.  The Company and the Investor shall
cooperate in good faith and use commercially reasonable efforts to achieve (and
the Investor shall use commercially reasonable efforts to cause DIAM to
cooperate and achieve), in connection with the DIAM Channel Sales, the following
targets (the “DIAM Channel Sales Targets”):
 
(a)           for the Company’s equity products released through the DIAM
distribution channels, there shall be, in the aggregate, at least $300,000,000
(inclusive of existing assets in DIA 100) of assets under management within
twelve (12) months following the date on which Investor releases such funds
through the DIAM distribution channels; and
 
(b)           for the fixed income products released through the DIAM
distribution channels, there shall be, in the aggregate, at least $1,000,000,000
of assets under management through the DIAM distribution channels (inclusive of
DIAM Global High Yield Account) within twelve (12) months following the date
hereof.
 
 
 
29

--------------------------------------------------------------------------------

 
 
The Parties acknowledge (x) that the DIAM Channel Sales Targets do not
constitute underwriting commitments by the Investor or DIAM, and (y) that assets
under management generated by the DIAM Channel Sales shall not be counted as
part of the assets under management for purposes of the Invested Assets.  The
release of the Company’s products through the DIAM distribution channels shall
be effected pursuant to a schedule that is mutually acceptable to the Company
and the Investor.
 
Section 6.4           Strategic Cooperation.
 
(a)           The Investor shall use commercially reasonable efforts to
introduce the Company to major retail banks and securities firms throughout
Japan with whom the Investor has strong relationships to facilitate the
expansion of the Company’s business in Japan.
 
(b)           The Investor shall use its commercially reasonable efforts to
assist the Company with (i) understanding DIAM’s business, plans and intentions,
(ii) building relationships with DIAM’s key members of management, and (iii)
maximizing the results of the strategic alliance contemplated by this Agreement
to expand DIAM’s distribution of the Company’s products in Japan.
 
(c)           The Investor shall, and shall use commercially reasonable efforts
to cause DIAM to, consult with the Company in good faith from time to time
regarding opportunities to expand the distribution relationship described in
Section 6.3.
 
(d)           The Investor and the Company shall discuss reasonably in good
faith the exchange of expertise and human resources between the Investor, DIAM
and the Company and provide the Investor with opportunities to increasing its
knowledge and expertise in the asset management business.
 
(e)           The Company shall work in good faith to consider the possibility
of using DIAM as a sub-advisor for the Company’s products in the United States;
provided that for the avoidance of doubt, the Company shall be under no
obligation to provide any opportunities or platforms to DIAM or distribute any
of DIAM’s products.
 
(f)           The Investor and the Company shall work in good faith to consider
the possibility of using the Company as a sub-advisor for pension products that
the Company would manage for the Investor’s institutional clients.
 
Section 6.5           Exchange of Expertise and Human Resources.  In furtherance
of the alliance contemplated by this Agreement, the Company and the Investor
intend, from time to time, to engage in the exchange of expertise and human
resources among the Company, the Investor and DIAM so that they may share and
develop knowledge and best practices with respect to their respective
businesses.  Without limiting the generality of the foregoing, following the
Effective Time and prior to termination of the Designation Right pursuant to
Section 5.2(c), the Investor shall be entitled to:
 
 
 
30

--------------------------------------------------------------------------------

 
 
(a)           assign or second to the Company one management level
representative from the Investor, which representative shall be reasonably
acceptable to the Company, to work at the Company’s headquarters on a full-time
basis in a management level position to be determined by mutual agreement by the
Company and the Investor, it being understood that the representative will work
full time in the Company’s financial department, will be invited to attend
executive committee meetings of Janus Capital Management and Janus Capital Group
(unless the Company’s Chief Executive Officer determines in good faith that the
presence of non-Company personnel at an executive committee meeting would be
inappropriate under the circumstances due to a potential conflict of interest
between the Investor and the Company) and offered in good faith opportunities to
learn the Company’s business by attending other management level meetings or
programs, in each case as an observer, and will receive monthly management
financial packages (of the type prepared by the Company in the ordinary course
of its business) and have the opportunity, upon reasonable advance notice, to
meet with the Company’s Chief Financial Officer to discuss the Company’s
financial results and information; and
 
(b)           assign or second to the Company two junior level representatives
from the Investor, which representatives shall be reasonably acceptable to the
Company, to work as analysts (or an equivalent junior-level position) in the
Company’s investment groups to gain experience in the Company’s research
methodologies.
 
For the avoidance of doubt, any individuals assigned or seconded to the Company
pursuant to this Section 6.5 shall be subject to employee, compliance,
confidentiality and other policies that are applicable for the Company’s
similarly situated employees.  In addition, the Investor shall provide any
information in respect of such individuals that the Company may reasonably
request.  The Company shall treat such individuals as it would treat other
employees of the Company in similarly situated positions on a non-discriminatory
basis, including with respect to the decision to terminate the assignment or
secondment of such individuals, and have the right to terminate the assignment
or secondment of such individuals to the Company following consultation in good
faith between the Company and the Investor regarding the reason for the
termination; provided that, following any such termination (as prior to
termination of the Designation Right pursuant to Section 5.2(c)), the Investor
shall have a right to promptly appoint a replacement representative or
representatives, as applicable, in accordance with the terms of this Agreement.
 
ARTICLE VII
 
REPRESENTATIONS AND WARRANTIES
 
Section 7.1           Representations and Warranties of the Company.  Except as
set forth in the Company SEC Documents (excluding any risk factor disclosures
and any forward-looking statements or other statements therein that are
cautionary or forward-looking in nature), the Company represents and warrants to
the Investor as of the date of this Agreement as follows:
 
 
 
31

--------------------------------------------------------------------------------

 
 
(a)           The Company (i) is duly organized, validly existing and in good
standing under the Laws of the jurisdiction of its organization, (ii) has all
requisite corporate or trust power and authority and the legal right to make,
deliver and perform this Agreement, and (iii) has taken all necessary action to
authorize the execution, delivery and performance of this Agreement (and the
performance of the transactions contemplated by this Agreement).
 
(b)           Each of this Agreement and the Option Agreement has been duly
executed and delivered by or on behalf of the Company.  Each of this Agreement
and the Option Agreement constitutes a legal, valid and binding obligation of
the Company enforceable against the Company in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar Law relating to or affecting
creditors’ rights generally and general equitable principles (whether considered
in a proceeding in equity or at law).
 
(c)           Other than the expiration of the applicable waiting period under
the HSR Act, the making of the applicable filing with the Financial Services
Agency of Japan and the matters listed on Schedule 7.1(c) of the Disclosure
Letter, no consent or authorization of, filing with, notice to, or other act by
or in respect of any Governmental Authority is required by or on behalf of the
Company or any of its Affiliates in connection with the execution, delivery and
performance of this Agreement or any Ancillary Agreement (and the performance of
the transactions contemplated by this Agreement and by the Option Agreement) as
a result of the Company’s or any of its Affiliates’ business or operations in
the geographical area over which such Governmental Authority exercises
jurisdiction.
 
(d)           Assuming that all consents, approvals, authorizations and other
actions described in Section 7.1(c) have been obtained, the execution, delivery
and performance by the Company of this Agreement and the Option Agreement, and
the consummation of the transactions contemplated by this Agreement and the
Option Agreement, do not and will not (i) violate, conflict with or result in
the breach of the certificate of incorporation or bylaws of the Company, (ii) in
any material respect conflict with or violate any Law or Order applicable to the
Company or its business, (iii) conflict with, result in any violation or breach
of, constitute a default (or event which with the giving of notice or lapse of
time, or both, would become a default) under, require any consent, approval,
authorization or other action by, or notification to, any third party under, or
give to others any rights of termination, amendment, withdrawal, first refusal,
first offer, acceleration, suspension, revocation or cancellation of, any
material note, bond, mortgage or indenture, contract, agreement, lease,
sublease, license, permit, franchise or other instrument or arrangement to which
the Company is a party.
 
(e)           No action, suit, proceeding or governmental investigation is
pending against the Company at law or in equity or before any Governmental
Authority that seeks to delay or prevent the execution, delivery or performance
of this Agreement or any Ancillary Agreement (or the performance of any of the
transactions contemplated by this Agreement and by the Option Agreement).
 
 
 
32

--------------------------------------------------------------------------------

 
 
(f)           The shares of Company Common Stock to be issued pursuant to the
Option Agreement have been duly authorized by all necessary corporate action of
the Company.  When issued and sold against receipt of the consideration
therefor, such shares of Company Common Stock will be validly issued, fully paid
and nonassessable, will not subject the holders thereof to personal liability
and will not be issued in violation of preemptive rights.  As of the date
hereof, no fewer than 14,000,000 shares of Company Common Stock have been duly
reserved for issuance pursuant to the terms of the Option Agreement.
 
(g)           Since January 1, 2011, the Company has timely filed or furnished
all reports, schedules, forms, statements and other documents required to be
filed or furnished by it with the SEC (collectively, together with any exhibits
and schedules thereto and other information incorporated therein (the “Company
SEC Documents”)), all of which have complied as of their respective filing dates
or, if amended or superseded by a subsequent filing, as of the date of the last
such amendment or superseding filing, as to form in all material respects with
the applicable requirements of the Securities Act, the Exchange Act and the
Sarbanes-Oxley Act of 2002 and, in each case, the rules and regulations of the
SEC promulgated thereunder.  None of the Company SEC Documents, including any
financial statements or schedules included or incorporated by reference therein,
at the time filed or, if amended or superseded by a subsequent filing, as of the
date of the last such amendment or superseding filing, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.  There are no
outstanding or unresolved comments in comment letters received from the SEC
staff with respect to the Company SEC Documents.
 
(h)           The audited and unaudited consolidated financial statements
(including the related notes thereto) of the Company included (or incorporated
by reference) in the Company SEC Documents have been prepared in accordance with
generally accepted accounting principles in the United States (“GAAP”) (except
as may be indicated in the notes thereto) applied on a consistent basis
throughout the periods involved and fairly present in all material respects the
consolidated financial position of the Company and its Subsidiaries as of their
respective dates, and the consolidated income, stockholders equity, results of
operations and changes in consolidated financial position or cash flows for the
periods presented therein (subject, in the case of the unaudited financial
statements, to normal year-end audit adjustments).  There are no liabilities or
obligations of the Company or any of its Subsidiaries of any kind whatsoever,
whether accrued, contingent, absolute, determined, determinable or otherwise,
other than: (i) liabilities or obligations disclosed and provided for in the
audited consolidated balance sheet of the Company and its Subsidiaries as of
December 31, 2011, and the footnotes thereto set forth in the Company’s annual
report on Form 10-K for the fiscal year ended December 31, 2011; (ii)
liabilities or obligations incurred in the ordinary course of business
consistent with past practices since December 31, 2011; and (iii) liabilities or
obligations that would not have, individually or in the aggregate, a Material
Adverse Effect.
 
 
 
33

--------------------------------------------------------------------------------

 
 
(i)           Since June 30, 2012, no Material Adverse Effect has occurred.
 
Section 7.2           Representations and Warranties of the Investor.  The
Investor represents and warrants to the Company as of the date of this Agreement
as follows:
 
(a)           The Investor (i) is duly organized and validly existing under the
Laws of the jurisdiction of its organization, (ii) has all requisite corporate
or trust power and authority and the legal right to make, deliver and perform
this Agreement, and (iii) has taken all necessary action to authorize the
execution, delivery and performance of this Agreement (and the performance of
the transactions contemplated by this Agreement).
 
(b)           Each of this Agreement and the Option Agreement has been duly
executed and delivered by or on behalf of the Investor.  Each of this Agreement
and the Option Agreement constitutes a legal, valid and binding obligation of
the Investor enforceable against the Investor in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar Law relating to or affecting
creditors’ rights generally and general equitable principles (whether considered
in a proceeding in equity or at law).
 
(c)           Other than the expiration of the applicable waiting period under
the HSR Act, submission of a notification filing to the Financial Services
Agency of Japan prior to the Company becoming an affiliate of the Investor in
accordance with applicable Law in Japan and the matters listed on Schedule
7.1(c) of the Disclosure Letter, no consent or authorization of, filing with,
notice to, or other act by or in respect of any Governmental Authority is
required by or on behalf of the Investor or any of its Affiliates in connection
with the execution, delivery and performance of this Agreement or the Option
Agreement (and the performance of the transactions contemplated by this
Agreement and by the Option Agreement) as a result of the Investor’s or any of
its Affiliates’ business or operations in the geographical area over which such
Governmental Authority exercises jurisdiction.
 
(d)           Assuming that all consents, approvals, authorizations and other
actions described in Section 7.1(c) have been obtained, the execution, delivery
and performance by the Investor of this Agreement and the Option Agreement, and
the consummation of the transactions contemplated by this Agreement and the
Option Agreement, do not and will not (i) violate, conflict with or result in
the breach of the certificate of incorporation or bylaws or similar
organizational or constitutional documents of the Investor, (ii) in any material
respect conflict with or violate any Law, Administrative Guidance or
Governmental Order applicable to the Investor or its business, (iii) conflict
with, result in any violation or breach of, constitute a default (or event which
with the giving of notice or lapse of time, or both, would become a default)
under, require any consent, approval, authorization or other action by, or
notification to, any third party under, or give to others any rights of
termination, amendment, withdrawal, first refusal, first offer, acceleration,
suspension, revocation or cancellation
 
 
 
34

--------------------------------------------------------------------------------

 
 
of, any material note, bond, mortgage or indenture, contract, agreement, lease,
sublease, license, permit, franchise or other instrument or arrangement to which
the Investor is a party.
 
(e)           No action, suit, proceeding or governmental investigation is
pending against the Investor at law or in equity or before any Governmental
Authority that seeks to delay or prevent the execution, delivery or performance
of this Agreement or the Option Agreement (or the performance of any of the
transactions contemplated by this Agreement and by the Option Agreement).
 
(f)           The Investor has the financial capability to complete the
transactions contemplated by this Agreement and by the Option Agreement.
 
(g)           The Investor (either alone or together with its advisors) has such
knowledge and experience in financial or business matters that it is capable of
evaluating the merits and risks of the transactions contemplated by this
Agreement and the Option Agreement.  The Investor has had the opportunity to ask
questions and receive answers concerning the terms and conditions of such
transactions and has had full access to such other information concerning the
Company Common Stock and the Company as it has requested.  The Investor has
received all information that it believes is necessary or appropriate in
connection with the Acquisition and the other transaction contemplated by this
Agreement and the Option Agreement.  The Investor is an informed and
sophisticated party and has engaged, to the extent the Investor deems
appropriate, expert advisors experienced in the evaluation of transactions of
the type contemplated hereby. The Investor acknowledges that it has not relied
upon any express or implied representations or warranties of any nature made by
or on behalf of the Company, whether or not any such representations, warranties
or statements were made in writing or orally, except as expressly set forth for
the benefit of the Investor in this Agreement.
 
(h)           The Investor understands that (i) the shares of Company Common
Stock to be purchased pursuant the Option Agreement and Section 2.7 have not
been registered under the Securities Act or any state securities laws, by reason
of their issuance by the Company in a transaction exempt from the registration
requirements thereof and (ii) any shares of Company Common Stock to be purchased
pursuant the Option Agreement or Section 2.7 may not be sold unless such
disposition is registered under the Securities Act and applicable state
securities laws or is exempt from registration thereunder; the Investor
acknowledges that, except as provided in Exhibit C, the Company does not have
any obligation to register any Shares.  The Investor is not acquiring any Shares
pursuant to the terms of this Agreement or the Option Agreement with a view to
the distribution thereof in violation of the Securities Act.
 
(i)           The Investor understands that its investment in the Shares
involves a significant degree of risk including a risk of total loss of its
investment, and it is fully aware of and understands all the risk factors
related to its purchase of the Shares.
 
 
 
35

--------------------------------------------------------------------------------

 
 
(j)           The Investor is an accredited investor (as defined in Rule 501(a)
of Regulation D under the Securities Act).
 
(k)           The Investor is not acting in concert, and does not have any
agreement or understanding, with any Person that is not an Affiliate of the
Investor, and is not otherwise a member of a group (as such term is used in
Section 13(d)(3) of the Exchange Act), with respect to the Company or its
securities, other than as may be deemed to arise by the consummation of the
transactions completed by this Agreement and the Option Agreement as a result of
any transaction by the Investor not prohibited by this Agreement or the Option
Agreement.
 
(l)           The information to be provided under the Information Rights is
sufficient as of the date hereof for the Investor to comply with its obligations
under applicable Law as currently in effect.
 
(m)           The execution, delivery and performance by the Company and the
Investor of this Agreement and the Option Agreement, and the consummation of the
transactions contemplated by this Agreement and the Option Agreement, do not and
will not subject the Company or any of its Affiliates to direct regulation by
any Japanese Governmental Authority.
 
ARTICLE VIII
 
TERMINATION
 
Section 8.1           Termination.  This Agreement may be terminated at any time
by mutual consent of the Investor and the Company or following written notice
from the Party seeking termination to the other Party (provided, that prior to
providing such notice (other than in connection with a termination pursuant to
Section 8.1(a), 8.1(b), 8.1(i) or 8.1(j)), a Senior Executive of the Party
seeking termination shall discuss such termination with a Senior Executive of
the other Party and consider in good faith alternatives to terminating this
Agreement if the other Party made such a request) as follows:
 
(a)           by either the Investor or the Company if a Material Adverse Effect
occurs with respect to the other Party prior to the Effective Time;
 
(b)           by either the Investor or the Company if an Insolvency Event shall
occur with respect to the other Party;
 
(c)           by either the Investor or the Company if necessary to comply with
applicable Law, Administrative Guidance or an Order;
 
(d)           by either the Investor or the Company if, as of 5:00 p.m. Eastern
Time on last day of the Purchase Window, the Investor Beneficially Owns less
than 15% of the issued and outstanding shares of Company Common Stock; provided
that this termination right may not be exercised by the Investor if (i) the
Investor’s breach of this
 
 
 
36

--------------------------------------------------------------------------------

 
 
Agreement has been the proximate cause of such failure of the Investor to
Beneficially Own at least 15% of the issued and outstanding shares of Company
Common Stock; or (ii) at any time prior to the expiration of the Purchase
Window, (A) the Investor Beneficially Owned at least 15% of the issued and
outstanding shares of Company Common Stock or (B) the sum of (x) the number of
shares of Company Common Stock Beneficially Owned by the Investor as of the date
hereof, (y) the number of shares of Company Common Stock acquired by Investor at
any time after the date hereof and prior to the expiration of the Purchase
Window and (z) the number of shares of Company Common Stock that the Investor
could have acquired if it exercised all Conditional Options (as defined in the
Option Agreement) that remain unexercised as of the expiration of the Purchase
Window (to extent that such exercise would at such time be permitted by the
limitations set forth in the approval of the board of directors of the Investor
described in Section 2.1(a)) (the “Potential Option Shares”), equals at least
15% of the issued and outstanding shares of Company Common Stock on a pro forma
basis (after giving effect to the issuance of the Potential Option Shares);
 
(e)           by either the Investor or the Company if, during any consecutive
five (5) Business Day period following the Effective Time, the Investor
Beneficially Owns less than 10% of the issued and outstanding shares of Company
Common Stock;
 
(f)           by the Company if there is a change in the Applicable Accounting
Standards that would significantly increase the burden to the Company in
complying with its obligations under the Information Rights;
 
(g)           by the Investor if (i) either the Company informs the Investor
that it is unable to comply with its obligations under the Information Rights or
there is a change in applicable Law in Japan that would require the Investor to
receive and report on information with respect to the Company Group that is not
required to be provided by the Company  pursuant to the Information Rights, (ii)
such inability to comply, or change in applicable Law in Japan, would or would
reasonably be expected to result in the Investor being in violation of
applicable Law in Japan and (iii) the Parties following good faith discussions
in accordance with their obligations under the Information Rights are unable to
agree on appropriate amendments to the Information Rights that, in light of the
circumstances under clause (i) hereof, would avoid the consequence in clause
(ii) hereof;
 
(h)           by either the Investor or the Company if there shall be a material
breach of this Agreement or the transactions contemplated hereby by the other
Party to this Agreement, which breach is not cured within thirty (30) calendar
days after the breaching Party’s receipt of a written notice in respect thereof
from the other Party;
 
(i)           by either the Investor or the Company if the Company elects to
terminate the Designation Right pursuant to Section 5.2(c);
 
(j)           by either the Investor or the Company at any time following the
third (3rd) anniversary of the date hereof, upon 90-days written notice to the
other Party (which notice may not be given prior to the third (3rd) anniversary
of the date hereof);
 
 
 
37

--------------------------------------------------------------------------------

 
 
provided that during the 90-day notice period the Parties shall discuss in good
faith whether to cancel such notice of termination and continue with the
transactions contemplated by this Agreement;
 
(k)           by the Company if the Company or any of its Affiliates becomes
subject to direct regulation by, or sanctions of, any Japanese Governmental
Authority that it would not be subject to in the absence of this Agreement or
the Option Agreement and the transactions contemplated hereby and thereby;
 
(l)           by the Investor if (w) the Company issues New Securities, (x)
prior to the issuance of New Securities the Investor’s Beneficial Ownership of
shares of the Company Common Stock was equal to or greater than 15%, (y) the
Investor is unable to purchase a sufficient number of shares of the Company
Common Stock (i) pursuant to Section 2.7, (ii) by using its commercially
reasonable efforts to purchase shares of Company Common Stock in the public
markets in accordance with applicable Law or (iii) by exercising any available
and unexercised Conditional Options (or any combination thereof), such that,
upon such issuance of New Securities, the Investor’s Beneficial Ownership of
shares of the Company Common Stock is not diluted to less than 15% of the issued
and outstanding shares of the Company Common Stock (after giving effect to the
issuance of New Securities and, if applicable, the issuance of shares of Company
Common Stock pursuant to the exercise of the Conditional Options referenced in
clause (y)(iii) hereof) and (z) at the time of such termination the Investor’s
Beneficial Ownership of shares of the Company Common Stock is less than 15% of
the issued and outstanding shares of the Company Common Stock;
 
(m)           by the Investor if the Investor or any of its Affiliates becomes
subject to direct regulation by, or sanctions of, any Governmental Authority,
other than a Japanese or U.S. Governmental Authority, that it would not be
subject to in the absence of this Agreement or the Option Agreement and the
transactions contemplated hereby and thereby; or
 
(n)           by the Investor or the Company if any consent or authorization of
any Governmental Authority that is required for the acquisition by the Investor
of Beneficial Ownership of no less than 15% of the issued and outstanding shares
of the Company Common Stock has not been obtained by the first anniversary of
the date hereof or if any such Governmental Authority has determined that it
will not provide any such consent or authorization; provided that neither Party
may exercise the termination right set forth in this Section 8.1(n) if such
Party’s breach of any representation, warranty, covenant or agreement set forth
in this Agreement, including Section 7.1(c), Section 7.2(c) and the penultimate
sentence of Section 2.4(c), has been the proximate cause of such termination
right becoming exercisable.
 
Section 8.2           Effect  of Termination.  In the event of termination of
this Agreement by either the Company or Investor as provided in Section 8.1,
this Agreement shall forthwith become void and have no effect, without any
liability or obligation on the part of the Investor, on the one hand, or the
Company, on the other hand, other than
 
 
 
38

--------------------------------------------------------------------------------

 
 
Article III, Sections 4.1, 4.3, 4.4, 4.6, 5.4 and 5.5, Article VIII and Article
IX, which provisions shall survive such termination, and Section 5.3, which
shall survive with respect to the fiscal quarter in which the Agreement is
terminated (or at such earlier time as provided under Section 5.3).
 
ARTICLE IX
 
MISCELLANEOUS
 
Section 9.1           Notices.  All notices, demands or other communications
provided for or permitted hereunder shall be made in writing and shall be by
registered or certified first class mail, return receipt requested, facsimile,
courier service, overnight mail or personal delivery:
 
If to the Company:
 
Janus Capital Group Inc.
151 Detroit Street
Denver, CO  80206
Attn:     General Counsel
Fax:       +1 (303) 639-6662
 
With a copy (which shall not constitute notice) to:
 
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, New York 10019-6064
Attn:     Toby S. Myerson
              Steven J. Williams
Fax:       +1 (212) 757-3900
 
If to the Investor:
 
The Dai-ichi Life Insurance Company, Limited
13-1, Yurakucho 1-chome, Chiyoda-ku, Tokyo 100-8411, Japan
Attn:     General Manager of the Investment Planning Department
Fax:       +81 (3) 5221-3971
 
With a copy (which shall not constitute notice) to:
 
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York  10017
Attn:     George R. Bason, Jr.
              Michael Davis
Fax:       +1 (212) 701-5800
 
 
 
39

--------------------------------------------------------------------------------

 
 
Any Party may by notice given in accordance with this Section 8.1 designate
another address or Person for receipt of notices hereunder.  All such notices
and communications shall be deemed to have been duly given when delivered by
hand, if personally delivered; when delivered by commercial courier or overnight
mail, if delivered by commercial courier or overnight mail service; and when
receipt is mechanically acknowledged, if delivered by telecopy.
 
Section 9.2           Amendment and Waiver.
 
(a)           No failure or delay on the part of any Party in exercising any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or remedy preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy.  The remedies provided for herein are cumulative and are not exclusive
of any remedies that may be available to the Parties hereto at law, in equity or
otherwise.
 
(b)           Any amendment, supplement or modification of or to any provision
of this Agreement shall be effective (i) only if it is made or given in writing
and signed by both Parties and (ii) only in the specific instance and for the
specific purpose for which made or given.  No waiver of any provision of this
Agreement or consent in respect of any departure from the terms of any provision
of this Agreement shall be effective unless evidenced in writing and executed by
the Party providing such waiver or consent.
 
(c)           Notwithstanding the foregoing, this Agreement may be amended by
the Company without the consent of the Investor to join any Affiliated
Transferee to this Agreement in accordance with Section 4.3(a).
 
Section 9.3           Specific Performance.  Each Party acknowledges and agrees
that damages resulting from its breach of this Agreement may well be impossible
to measure accurately, and injuries sustained by the other Party may well be
incalculable and irremediable.  Therefore, in addition to claiming damages in
respect thereof, the other Party shall be entitled to seek an injunction to
prevent a breach of the covenants and obligations hereof and such right shall be
cumulative and in addition to any other rights and remedies which may be
available.  All such rights and remedies may be exercised from time to time, and
as often and in such order as the Company deems expedient.
 
Section 9.4           Headings.  The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
 
Section 9.5           Severability.  If any one or more of the provisions
contained in this Agreement, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions of this Agreement shall not be in any
way impaired, unless the provisions held
 
 
 
40

--------------------------------------------------------------------------------

 
 
invalid, illegal or unenforceable shall substantially impair the  of the
remaining provisions hereof.
 
Section 9.6           Public Announcements.  No Party shall issue or cause the
publication of any press release or other public announcement with respect to
this Agreement or any of the transactions contemplated by this Agreement without
the prior written consent of the other Party; provided, however, that nothing in
this Agreement shall prohibit any Party from issuing or causing publication of
any such press release or public announcement to the extent that such disclosure
is required by applicable Law or the rules of a securities exchange on which a
Party’s securities are listed (including, for the avoidance of doubt, the Tokyo
Stock Exchange), in which case such Party shall, if practicable under the
circumstances, reasonably consider any comments of the other Party on such press
release or public announcement in advance of the issuance or publication
thereof; provided, further, that the foregoing shall not restrict communications
between either Party and the investors or potential investors of such Party or
its Affiliates in the ordinary course of business consistent with past
practice.  Notwithstanding the foregoing, promptly following the execution and
delivery of this Agreement, each of the Company and the Investor shall issue a
press release in the form mutually agreed.
 
Section 9.7           Entire Agreement; No Third Party Beneficiaries.  This
Agreement (including the Exhibits to this Agreement) is intended by the Parties
as a final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the Parties hereto in
respect of the subject matter contained in this Agreement and therein.  There
are no restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein or therein.  This Agreement, including the Exhibits
to this Agreement, supersedes all prior agreements and understandings between
the Parties with respect to such subject matter.  Nothing in this Agreement,
expressed or implied, is intended to confer upon any Person, other than the
Parties, any rights or remedies hereunder.
 
Section 9.8           GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY
TRIAL.
 
(a)           THIS AGREEMENT AND ANY CLAIM OR CONTROVERSY UNDER THIS AGREEMENT
SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH
STATE, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF.
 
(b)           THE PARTIES IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF
ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF NEW YORK, IN THE STATE OF
NEW YORK OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE AFFAIRS OF THE COMPANY.  TO THE FULLEST
 
 
 
41

--------------------------------------------------------------------------------

 
 
EXTENT THEY MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, THE PARTIES HERETO
IRREVOCABLY WAIVE AND AGREE NOT TO ASSERT, BY WAY OF MOTION, AS A DEFENSE OR
OTHERWISE, ANY CLAIM THAT THEY ARE NOT SUBJECT TO THE JURISDICTION OF ANY SUCH
COURT, ANY OBJECTION THAT THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE
VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY
CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.
 
(c)           TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE
WAIVED, EACH PARTY WAIVES AND COVENANTS THAT IT SHALL NOT ASSERT (WHETHER AS
PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN
RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT,
TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED
UPON THIS AGREEMENT OR THE SUBJECT MATTER OF THIS AGREEMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT, IN EACH CASE, WHETHER NOW EXISTING OR HEREAFTER ARISING.  EACH PARTY
ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTY THAT THIS SECTION 8.8
CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH IT IS RELYING AND WILL RELY IN
ENTERING INTO THIS AGREEMENT.  EITHER PARTY HERETO MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION 8.8 WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
 
Section 9.9           Further Assurances.  Each of the Parties shall execute
such instruments and take such action as may be reasonably required or desirable
to carry out the provisions of this Agreement and effect the transactions
contemplated by this Agreement.
 
Section 9.10         Successors and Assigns.  Except as otherwise provided in
this Agreement, this Agreement shall be binding upon and inure to the benefit of
the Parties and their respective successors, assigns, heirs, legatees and legal
representatives.  This Agreement shall not assignable by any Party without the
prior written consent of the other Party; provided that, subject to Section
4.3(a), the Investor may assign its rights and obligations hereunder (in whole
or in part) without the prior written consent of the Company to any Affiliated
Transferee and any such Affiliated Transferee may thereafter make corresponding
assignments to other Affiliated Transferees; provided, that if such transferee
ceases to be an Affiliated Transferee, such rights and obligations shall be
assigned back to the Investor or another Affiliated Transferee; provided,
further, that, no such assignment shall relieve the Investor of its obligations
hereunder.
 
 
 
42

--------------------------------------------------------------------------------

 
 
 
Section 9.11         Counterparts.  This Agreement may be executed in one or
more counterparts (by facsimile or otherwise), each of which shall be deemed an
original, and all of which taken together shall constitute one and the same
instrument.
 
[Signature Page Follows]
 
 
 
 

 
 
43

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by each
Party or a duly authorized officer of each Party as of the date first above
written.
 

 
JANUS CAPITAL GROUP INC.
                     
By:
/s/ Richard M. Weil      
Name:
Richard M. Weil      
Title:
Chief Executive Officer            

 

 
THE DAI-ICHI LIFE INSURANCE
    COMPANY, LIMITED
                     
By:
/s/ Hideto Masaki
     
Name:
Hideto Masaki
     
Title:
Representative Director, Deputy President
           

 
 
 

 
 
Signature Page to Investment and Strategic Cooperation Agreement

 
 

--------------------------------------------------------------------------------

 

  Exhibit A
  Delaware 203 Approval

RESOLVED, that the approval of the Agreement and the transactions contemplated
thereby, including the Acquisition and the other transactions contemplated by
the Agreement and Option Agreement, is intended to and shall be effective for
the purposes of Section 203 of the DGCL and, as a result, the Investor and each
of its Affiliates (as defined in the Agreement) shall not be deemed to be an
“interested stockholder” for purposes of Section 203 of the DGCL and the
transactions contemplated by the Agreement or as a result of the execution
thereof, and that the officers of the Company be, and each of them individually
hereby is, authorized and empowered in the name and on behalf of the Company to
take any further steps, if necessary, to render Section 203 of the DGCL
inapplicable to the Agreement and the transactions contemplated thereby,
including the Acquisition and the other transactions contemplated by the
Agreement and Option Agreement.
 
 
 

 
 
 

--------------------------------------------------------------------------------

 

  Exhibit B
  Form of Option Agreement

OPTION AGREEMENT, dated as of August 10, 2012 (this “Agreement”), by and between
Janus Capital Group Inc., a Delaware corporation (the “Company”), and The
Dai-ichi Life Insurance Company, Limited, a Japanese corporation (the
“Investor”).  The Company and the Investor may be referred to in this Agreement
individually as a “Party” and collectively as the “Parties”.
 
RECITALS
 
WHEREAS, concurrently with the execution of this Agreement, the Company and the
Investor are entering into an Investment and Strategic Cooperation Agreement,
dated as of August 10, 2012 (the “Investment Agreement”);
 
WHEREAS, the Investor is committing in the Investment Agreement, among other
things, to use commercially reasonable efforts to acquire shares of common
stock, par value $0.01 per share, of the Company (the “Company Common Stock”) in
accordance with the terms and conditions set forth in the Investment Agreement
(the “Acquisition”); and
 
WHEREAS, to assist the Investor in effecting the Acquisition, the Company
desires to grant the Investor a series of conditional options to purchase shares
of the Company Common Stock in accordance with the terms and conditions of this
Agreement.
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties agree as
follows:
 
(a)           Definitions.  Capitalized terms used and not otherwise defined in
this Agreement shall have the meanings ascribed to them in the Investment
Agreement.
 
(b)           Conditional Option.
 
(i)           The Company hereby grants to the Investor twenty (20) conditional
options (each, a “Conditional Option” and collectively, the “Conditional
Options”), each to purchase 700,000 shares of the Company Common Stock (such
shares, the “Option Shares”), for a purchase price of $10.25 per share (the
“Option Price”), subject to the terms and limitations set forth herein.  For the
avoidance of doubt, each Conditional Option may only be settled in shares of
Company Common Stock and no net settlement or cash settlement shall be permitted
hereunder. In the event that, prior to exercise of a Conditional Option, the
Company changes the number of shares of Company Common Stock issued and
outstanding as a result of a reclassification, stock split (including a reverse
split), stock-based dividend or distribution, merger, subdivision, combination
or other similar transaction, the number of Option Shares and the number of
 
 
 
 

--------------------------------------------------------------------------------

 
 
shares of Company Common Stock contained in each Conditional Option shall be
adjusted appropriately to provide to the Investor the same economic and
ownership effect as contemplated by this Agreement prior to such
reclassification, split, dividend, distribution, merger, subdivision,
combination or similar transaction.
 
(ii)          The Investor shall have the right to exercise one or more (or all)
of the Conditional Option(s) following such time that the Investor Beneficially
Owns not less than 8% of the issued and outstanding shares of the Company Common
Stock, provided, that in no event shall the Investor have the right to exercise
a Conditional Option to the extent that such exercise would cause the Investor’s
Beneficial Ownership of shares of the Company Common Stock to exceed the
Ownership Limit.  For the avoidance of doubt, each Conditional Option may only
be exercised in whole and not in part.
 
(iii)         Each Conditional Option shall, if not exercised, terminate on the
earlier of (x) the expiration of the Purchase Window (as defined in the
Investment Agreement) and (y) the termination of the Investment Agreement in
accordance with its terms.
 
(iv)        The Investor acknowledges that (i) the Option Shares have not been
registered under the Securities Act or any state securities laws, by reason of
their issuance by the Company in a transaction exempt from the registration
requirements thereof and (ii) any Option Shares purchased pursuant to this
Agreement may not be sold unless such disposition is registered under the
Securities Act and applicable state securities laws or is exempt from
registration thereunder; the Investor acknowledges that, except as provided in
Exhibit C to the Investment Agreement, the Company does not have any obligation
to register any Option Shares.
 
(c)           Option Consideration.  The Parties agree that the aggregate value
of the Conditional Options has been reasonably determined by the mutual
agreement of the Parties and that such value, set forth on Schedule 1 to the
Disclosure Letter of the Investment Agreement, shall be paid in immediately
available funds in U.S. dollars by Investor to the account of Company set forth
on forth on Schedule 2 to the Disclosure Letter of the Investment Agreement
within five (5) Business Days after the date hereof.
 
(d)           Exercise Procedures.  To exercise one or more (or all) of the
Conditional Option(s), the Investor shall deliver an irrevocable written notice
of such exercise (the “Exercise Notice”) to the Company at the address set forth
in subsection (e) below.  The Exercise Notice shall indicate the number of
Conditional Options that the Investor is exercising.  As promptly as reasonably
practicable, but not less than five Business Days, following the delivery of an
Exercise Notice to the Company the Company and the Investor shall effect the
closing of the exercise of the Conditional Option(s) indicated by the Exercise
Notice.  At such closing, (a) the Investor shall pay or cause to be paid to the
account of Company set forth on forth on Schedule 2 to the Disclosure Letter of
the Investment Agreement (as such account may be updated by notice to the
Investor) an amount in U.S. dollars that is equal to the aggregate Option Price
in respect of the number of Option Shares contained in the exercised Conditional
 
 
 
B-2

--------------------------------------------------------------------------------

 
 
Option(s), and (b) the Company shall issue the Options Shares contained in the
exercised Conditional Option(s) to the Investor.
 
(e)           Notices.  All notices, demand or other communications provided for
or permitted hereunder shall be made in writing and shall be by registered or
certified first class mail, return receipt requested, facsimile, courier
service, overnight mail or personal delivery:
 
If to the Company:
Janus Capital Group Inc.
151 Detroit Street
Denver, CO  80206
Attn:     General Counsel
Fax:        +1 (303) 639-6662
   
With a copy (which shall
not constitute notice) to:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, New York 10019-6064
Attn:     Toby S. Myerson
              Steven J. Williams
Fax:        +1 (212) 757-3900
   
If to the Investor:
The Dai-ichi Life Insurance Company, Limited
13-1, Yurakucho 1-chome, Chiyoda-ku, Tokyo 100-8411, Japan
Attn:     General Manager of the Investment Planning Department
Fax:        +81 (3) 5221-3971
   
With a copy (which shall
not constitute notice) to:
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York  10017
Attn:     George R. Bason, Jr.
              Michael Davis
Fax:        +1 (212) 701-5800

 
(f)           Miscellaneous.
 
(i)           This Agreement and the Investment Agreement contain the entire
understanding of the parties in respect of the subject matter hereof, and
supersede all prior agreements, written or oral, with respect thereto.
 
(ii)           THIS AGREEMENT AND ANY CLAIM OR CONTROVERSY UNDER THIS AGREEMENT
SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH
STATE, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF, EXCEPT FOR
MATTERS DIRECTLY IN THE
 
 
 
B-3

--------------------------------------------------------------------------------

 
 
PURVIEW OF THE DELAWARE GENERAL CORPORATION LAW (“DGCL”), WHICH MATTERS SHALL BE
GOVERNED BY THE DGCL.
 
(iii)           THE PARTIES IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF
ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF NEW YORK, IN THE STATE OF
NEW YORK OVER ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE AFFAIRS OF THE COMPANY.  TO THE FULLEST EXTENT THEY MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, THE PARTIES HERETO IRREVOCABLY WAIVE AND
AGREE NOT TO ASSERT, BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE, ANY CLAIM THAT
THEY ARE NOT SUBJECT TO THE JURISDICTION OF ANY SUCH COURT, ANY OBJECTION THAT
THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
 
(iv)           TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE
WAIVED, EACH PARTY WAIVES AND COVENANTS THAT IT SHALL NOT ASSERT (WHETHER AS
PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN
RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT,
TORT OR OTHERWISE), INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED
UPON THIS AGREEMENT OR THE SUBJECT MATTER OF THIS AGREEMENT OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT, IN EACH CASE, WHETHER NOW EXISTING OR HEREAFTER ARISING.  EACH PARTY
ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTY THAT THIS SECTION
CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH IT IS RELYING AND WILL RELY IN
ENTERING INTO THIS AGREEMENT.  EITHER PARTY HERETO MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
 
(v)           Each Party hereto hereby acknowledges that irreparable damage
would occur, and the remedies at law of each other Party hereto would be
inadequate, if any term or provision hereof were not performed or observed
strictly in accordance herewith, and hereby unconditionally and irrevocably
waives any defense that may be available to it that any other Party’s remedies
at law are adequate or that its injuries are not irreparable.  Each Party hereto
may, without posting any bond or other security and in addition to any remedy
available to it at law, obtain equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction, or
any other equitable remedy which may then be available to it.
 
 
 
B-4

--------------------------------------------------------------------------------

 
 
 
(vi)           Neither this Agreement nor any of the rights granted herein
(including any of the Conditional Options), nor any of the other interests and
obligations created hereunder, may be transferred, assigned or delegated by
either Party without the prior written consent of the other Party and any
purported transfer, assignment or delegation without such consent shall be void,
except that the Investor may, upon prior notice to the Company, transfer this
Agreement and all of its rights, interests and obligations herein to any
Affiliated Transferee (as defined in the Investment Agreement) without the
consent of the Company.
 
(vii)           This Agreement may be executed in one or more counterparts (by
facsimile or otherwise), each of which shall be deemed an original, and all of
which taken together shall constitute one and the same instrument.
 
[Signature Page Follows]
 

 
B-5

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by each
party hereto or a duly authorized officer of each party hereto as of the date
first above written.
 

 
JANUS CAPITAL GROUP INC.
                     
By:
       
Name:
Richard M. Weil      
Title:
Chief Executive Officer                    
THE DAI-ICHI LIFE INSURANCE
    COMPANY, LIMITED
                     
By:
 
     
Name:
Hideto Masaki
     
Title:
Representative Director, Deputy President
 

 
 
 
Signature Page to Option Agreement
 
 

--------------------------------------------------------------------------------

 

  Exhibit C
  Registration Rights

The following sets forth the terms of the Investor’s Registration Rights under
the Agreement and is incorporated by reference therein.  Terms not otherwise
defined herein shall have the meaning ascribed to such term in the Agreement.

(a)           Shelf Registration; Demand Registrations and Shelf Take-Downs.  At
any time following the Effective Time that the Investor Beneficially Owns shares
of the Company Common Stock that it acquired through the exercise of any option
under the Option Agreement or pursuant to, or as permitted by, Sections 2.1, 2.7
or 3.2 of the Agreement or Shares in respect thereof (such shares, the
“Registrable Shares”), and only at a time when the Company Common Stock is
registered pursuant to Section 12(b) or 12(g) the Exchange Act, the Investor
shall have the right to:
 
(i)           request in writing that the Company, as promptly as reasonably
practicable, but not later than the 60th day after receipt of such written
request (any such date of filing, the “Shelf Filing Date”), prepare and file
with the SEC a Registration Statement (as defined below) providing for the
direct resales for cash by Investor of the Registrable Shares not already
covered by an existing and effective Registration Statement for an offering to
be made on a continuous basis pursuant to Rule 415 under the Securities Act (a
“Shelf Registration Statement”).  The Shelf Registration Statement shall be on
Form S-3 and, if the Company is a “well known seasoned issuer” (as defined under
Rule 405 under the Securities Act) as of the Shelf Filing Date, shall be an
automatic shelf registration statement” (as defined under Rule 405 under the
Security Act).  The “Plan of Distribution” section of such Shelf Registration
Statement shall permit all lawful means of disposition of Registrable Shares,
including firm-commitment underwritten public offerings, block trades, agented
transactions, sales directly into the market, purchases or sales by brokers and
sales not involving a public offering.  Thereafter, the Company shall use its
reasonable best efforts to cause any such Shelf Registration Statement to be
declared effective or otherwise to become effective under the Securities Act as
soon as reasonably practicable but in no event later than 60 days after the
Shelf Filing Date, and shall use its commercially reasonable efforts to keep
such Shelf Registration Statement continuously effective under the Securities
Act until Investor ceases to have registration rights hereunder with respect to
the Registrable Shares; and
 
(ii)          demand, by delivery of a written notice to the Company, (x) the
filing of a Registration Statement (a “Demand Registration”) by the Company
pursuant to the Securities Act to register such amount of the Registrable Shares
indicated by the Investor in such notice (a “Demand Notice”) or (y) the filing
of a prospectus supplement by the Company in connection with any take-down from
an effective Shelf Registration
 
 
 
 

--------------------------------------------------------------------------------

 
 
Statement under which the Registrable Shares are covered (a “Prospectus
Supplement”).
 
Notwithstanding anything in this Exhibit C to the contrary, (x) the Investor
shall not be entitled to make any demand unless it is permitted to Transfer
under Section 4.1 of the Agreement the Registrable Shares for which the Investor
demands registration or the filing of a Prospectus Supplement and has satisfied
its obligations under Section 4.6 of the Agreement and is in the ROFO Open
Period with respect to such Registrable Shares and (y) the Investor shall not,
at any time, be entitled to make more than two demands for a Demand Registration
in the aggregate (it being understood and agreed, for the avoidance of doubt,
that any demand for the filing of a Prospectus Supplement by the Company in
connection with any take-down under a Shelf Registration Statement shall not
constitute a Demand Registration).  Each request for a Demand Registration by
the Investor shall state the amount of the Registrable Shares proposed to be
sold and the intended method of disposition thereof.  “Registration Statement”
means any registration statement on Form S-3 (or any successor form thereto) of
the Company or, if the Company is not eligible to file on Form S-3, a Form S-1
(or any successor form thereto) of the Company, in each case that covers
Registrable Shares pursuant to the provisions of this Agreement, including the
prospectus, amendments and supplements to such registration statement, including
pre- and post-effective amendments, and all exhibits and all material
incorporated by reference in such registration statement.
 
(b)           Certain Limitations.  Notwithstanding anything in paragraph (a) of
this Exhibit C to the contrary, the Company shall not be obligated to effect a
Demand Registration or Prospectus Supplement if the Investor proposes to sell
its Registrable Shares at an aggregate price (calculated based upon the Market
Price of the Company Common Stock on the date of filing of the Registration
Statement with respect to such Registrable Shares) to the public of less than
$50,000,000.  If the Company Board, in its good faith judgment, determines that
any registration of Registrable Shares should not be made or continued because
it would interfere with any financing, acquisition, corporate reorganization or
merger or other material transaction involving the Company (a “Valid Business
Reason”), the Company may (x) postpone filing a Registration Statement or
Prospectus Supplement until such Valid Business Reason no longer exists, but in
no event for more than ninety (90) days for any individual Valid Business Reason
or more than 120 days during any 12-month period, and (y) in case a Registration
Statement has been filed relating to a Demand Registration, if the Valid
Business Reason has not resulted from actions taken by the Company, the Company,
upon the approval of a majority of the Board of Directors, may cause such
Registration Statement to be withdrawn and its effectiveness terminated or may
postpone amending or supplementing such Registration Statement.  The Company
shall give written notice of its determination to postpone or withdraw a
Registration Statement or Prospectus Supplement, as applicable, and of the fact
that the Valid Business Reason for such postponement or withdrawal no longer
exists, in each case, promptly after the occurrence thereof.  “Market Price”
means, on any date of determination, the average of the daily Closing Price of
the Company Common Stock for the immediately preceding thirty (30) days on which
the national securities exchanges are open for trading.  “Closing Price” means
the average of the closing bid and asked prices on such date, as officially
reported on the principal national securities
 
 
 
C-2

--------------------------------------------------------------------------------

 
 
exchange on which the shares of Company Common Stock are then listed or admitted
to trading.
 
(c)           Effectiveness of Demand Registrations.  Following receipt of a
valid Demand Notice, the Company shall use its commercially reasonable efforts
to cause the requested Demand Registration to become and remain effective not
later than sixty (60) days after the Company’s receipt of such Demand
Notice.  A registration shall not constitute a Demand Registration until it has
become effective and remains continuously effective for the lesser of (i) the
period during which all Registrable Shares registered in the Demand Registration
are sold and (ii) 120 calendar days; provided, however, that a registration
shall not constitute a Demand Registration if (x) after such Demand Registration
has become effective, such registration or the related offer, sale or
distribution of Registrable Shares thereunder is interfered with by any stop
order, injunction or other order or requirement of the SEC or other Governmental
Authority or court for any reason attributable to the Company and such
interference is not thereafter eliminated or (y) the conditions specified in the
underwriting agreement, if any, entered into in connection with such Demand
Registration are not satisfied or waived, by reason of a failure by the Company.
 
(d)           Piggyback Registration Rights.  If, at any time following the
Effective Time, the Investor Beneficially Owns any Registrable Shares and the
Company intends to register any shares of the Company Common Stock under the
Securities Act by filing a registration statement or prospectus supplement on a
form and in a manner that would permit registration of such shares of the
Company Common Stock for sale to the public under the Securities Act (other than
any registration of shares of the Company Common Stock on Form S-4 or S-8 or any
similar forms or any successor forms thereto), then the Company shall provide a
written notice (the “Piggyback Notice”) to the Investor of such intention at
least five (5) Business Days (provided that if the Company determines that a
shorter notice period is required to avail itself of favorable market
conditions, the Company shall provide the Investor with no less than two (2)
Business Days’ notice) prior to any filing of such registration statement or
prospectus supplement, as applicable, which Piggyback Notice shall offer the
Investor an opportunity to include in such registration statement all or a
portion of the Registrable Shares Beneficially Owned by the Investor on the
terms and conditions (including any underwriting lock-ups and other
restrictions) of the proposed offering.  The Investor shall, to the extent it is
so permitted under the terms of the Agreement, have a reasonable period under
the circumstances (that shall be determined in good faith by the Company, based
on market conditions)  after delivery of the Piggyback Notice to notify the
Company in writing that the Investor agrees to the terms and conditions of the
proposed offering and elects to include all or a portion of the Registrable
Shares in such offering, specifying the amount of the Registrable Shares to be
included.  Notwithstanding anything to the contrary contained in this paragraph
(d), (i) the Investor shall not be entitled to elect to include any Registrable
Shares in the Company’s offering pursuant to this paragraph (d) until it
furnishes the information required by paragraph (f) and unless it is permitted
to Transfer under Section 4.1 of the Agreement the Registrable Shares which the
Investor requests to include in the Company’s offering, (ii) the Company shall
have the right to terminate or withdraw any registration initiated by it prior
to the effectiveness of such registration
 
 
 
C-3

--------------------------------------------------------------------------------

 
 
 
whether or not the Investor has elected to include all or a portion of the
Registrable Shares in such registration, and (iii) if the registration
contemplated by the Piggyback Notice is an underwritten registration, and to the
extent the managing underwriters thereof in good faith advise the Company that
in their opinion the number of Registrable Shares elected to be included in such
registration would cause the aggregate number of shares of the Company Common
Stock to be offered to be greater than that which can be sold in an orderly
manner in such offering within a price range acceptable to the Company, then the
Company shall not be required to include in such offering such Registrable
Shares.
 
(e)           Expenses.
 
(i)           Except as set forth in paragraph (h) of this Exhibit C, each Party
shall bear its own expenses in connection with the performance of the
transactions contemplated by this Exhibit C; provided, however, that the Company
and the Investor shall each be liable for and pay one-half of the Registration
Expenses incurred in connection with the filing of any Shelf Registration
Statement, Demand Registration or Prospectus Supplement pursuant to paragraph
(a) of this Exhibit C.
 
(ii)          “Registration Expenses” means any and all expenses incident to the
performance of or compliance with any registration or marketing of Company
Securities, including all (i) registration and filing fees, and all other fees
and expenses payable in connection with the listing of securities on any
securities exchange or automated interdealer quotation system, (ii) fees and
expenses of compliance with any securities or “blue sky” laws (including
reasonable fees and disbursements of counsel in connection with “blue sky”
qualifications of the securities registered), (iii) expenses in connection with
the preparation, printing, mailing and delivery of any registration statements,
prospectuses and other documents in connection therewith and any amendments or
supplements thereto, (iv) security engraving and printing expenses, (v) fees and
disbursements of counsel for the Company and fees and expenses for independent
certified public accountants retained by the Company (including the expenses
relating to any comfort letters or costs associated with the delivery by
independent certified public accountants of any comfort letters), (vi)
reasonable fees and expenses of any special experts retained by the Company in
connection with such registration, (vii) reasonable fees and expenses of the
Investor, including fees and expenses of the Investor’s counsel, (viii) fees and
expenses in connection with any review by FINRA of the underwriting arrangements
or other terms of the offering, and all fees and expenses of any “qualified
independent underwriter,” including the fees and expenses of any counsel
thereto, (ix) fees and disbursements of underwriters customarily paid by issuers
or sellers of securities, but excluding any underwriting fees, discounts and
commissions attributable to the sale of Registrable Shares, (x) costs of
printing and producing any agreements among underwriters, underwriting
agreements, any “blue sky” or legal investment memoranda and any selling
agreements and other documents in connection with the offering, sale or delivery
of the Registrable Shares, (xi) transfer agents’ and registrars’ fees and
expenses and the fees and expenses of any other agent or trustee appointed in
connection with such offering, (xii) expenses relating to any analyst or
investor presentations or any “road shows” undertaken in connection with the
 
 
 
C-4

--------------------------------------------------------------------------------

 
 
registration, marketing or selling of the Registrable Shares, (xiii) fees and
expenses payable in connection with any ratings of the Registrable Shares,
including expenses relating to any presentations to rating agencies and (xiv)
all out-of pocket costs and expenses incurred by the Company or its appropriate
officers in connection with their compliance with paragraph (j)(x) of this
Exhibit C.
 
(f)           Information.  In connection with any Registration Statement or
Prospectus Supplement in which the Investor is participating pursuant to
paragraph (a) of this Exhibit C, the Investor shall promptly furnish to the
Company in writing such information with respect to the Investor or the
distribution of the Registrable Shares as the Company may reasonably request or
as may be required by Law for use in connection with any such Registration
Statement, preliminary prospectus, final prospectus or Prospectus Supplement and
all information required to be disclosed in order to make the information
previously furnished to the Company by the Investor not materially misleading or
necessary to cause such Registration Statement or prospectus not to omit a
material fact with respect to the Investor necessary in order to make the
statements therein not misleading.
 
(g)           Termination.  For the purposes of this Agreement, the Investor
shall cease to have registration rights hereunder with respect to the
Registrable Shares, when (i) the entire amount of the Registrable Shares owned
by Investor have been disposed of pursuant to the terms of this Exhibit C or
(ii) the entire amount of the Registrable Shares owned by Investor may be sold
in a single sale, in the opinion of counsel satisfactory to the Company and the
Investor, without any limitation as to volume pursuant to Rule 144 (or any
successor provision then in effect) under the Securities Act.
 
(h)           Indemnification.
 
(i)           Indemnification by the Company.  The Company agrees to indemnify
and hold harmless the Investor, its partners, directors, officers, Affiliates
and each Person who controls (within the meaning of Section 15 of the Securities
Act) such Investor from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation) (each, a
“Liability” and collectively, “Liabilities”), arising out of or based upon any
untrue, or allegedly untrue, statement of a material fact contained in any
Registration Statement, prospectus or preliminary prospectus or notification or
offering circular (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) or arising out of or based upon
any omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading under
the circumstances such statements were made, except insofar as such Liability
arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission contained in such Registration Statement,
preliminary prospectus, final prospectus or Prospectus Supplement in reliance
and in conformity with information
 
 
 
C-5

--------------------------------------------------------------------------------

 
 
concerning the Investor or the distribution of the Registrable Shares furnished
in writing to the Company by the Investor expressly for use therein, including,
without limitation, the information furnished to the Company pursuant to
paragraph (f) of this Exhibit C.
 
(ii)          Indemnification by the Investor.  The Investor agrees to indemnify
and hold harmless the Company, its directors, officers, Affiliates, any
underwriter retained by the Company and each Person who controls the Company or
such underwriter (within the meaning of Section 15 of the Securities Act) to the
same extent as the foregoing indemnity from the Company to the Investor, but
only if such statement or alleged statement or omission or alleged omission was
made in reliance upon and in conformity with information with respect to the
Investor or the distribution of the Registrable Shares furnished in writing to
the Company by the Investor expressly for use in the applicable Registration
Statement or prospectus, including, without limitation, the information
furnished to the Company pursuant to this paragraph (f) of this Exhibit C.
 
(iii)         Conduct of Indemnification Proceedings.  Any Person entitled to
indemnification hereunder (the “Indemnified Party”) agrees to give prompt
written notice to the indemnifying party (the “Indemnifying Party”) after the
receipt by the Indemnified Party of any written notice of the commencement of
any action, suit, proceeding or investigation or threat thereof made in writing
for which the Indemnified Party intends to claim indemnification or contribution
pursuant to this Agreement; provided, however, that the failure so to notify the
Indemnifying Party shall not relieve the Indemnifying Party of any Liability
that it may have to the Indemnified Party hereunder (except to the extent that
the Indemnifying Party is materially prejudiced or otherwise forfeits
substantive rights or defenses by reason of such failure).  If notice of
commencement of any such action is given to the Indemnifying Party as above
provided, the Indemnifying Party shall be entitled to participate in and, to the
extent it may wish, jointly with any other Indemnifying Party similarly
notified, to assume the defense of such action at its own expense, with counsel
chosen by it. The Indemnified Party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be paid by the Indemnified Party unless
(i) the Indemnifying Party agrees to pay the same, (ii) the Indemnifying Party
fails to assume the defense of such action or (iii) the named parties to any
such action (including any impleaded parties) include both the Indemnifying
Party and the Indemnified Party and such parties have been advised by such
counsel that either (x) representation of such Indemnified Party and the
Indemnifying Party by the same counsel would be inappropriate under applicable
standards of professional conduct or (y) there may be one or more legal defenses
available to the Indemnified Party which are different from or additional to
those available to the Indemnifying Party.  In any of such
 
 
 
C-6

--------------------------------------------------------------------------------

 
 
cases, the Indemnifying Party shall not have the right to assume the defense of
such action on behalf of such Indemnified Party, it being understood, however,
that the Indemnifying Party shall not be liable for the fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) for
all Indemnified Parties.  No Indemnifying Party shall be liable for any
settlement entered into without its written consent, which consent shall not be
unreasonably withheld.  No Indemnifying Party shall, without the consent of such
Indemnified Party, effect any settlement of any pending or threatened proceeding
in respect of which such Indemnified Party is a party and indemnity has been or
may be sought hereunder by such Indemnified Party, unless such settlement
includes an unconditional release of such Indemnified Party from all liability
for claims that are the subject matter of such proceeding.
 
(iv)        Contribution.  If the indemnification provided for in this Exhibit C
from the Indemnifying Party is unavailable to an Indemnified Party hereunder in
respect of any Liabilities referred to herein, then the Indemnifying Party, in
lieu of indemnifying such Indemnified Party, shall contribute to the amount paid
or payable by such Indemnified Party as a result of such Liabilities in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party and Indemnified Party in connection with the actions which resulted in
such Liabilities, as well as any other relevant equitable considerations.  The
relative faults of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such action.  The amount paid or payable by a party as a
result of the Liabilities referred to above shall be deemed to include, subject
to the limitations set forth in paragraphs (h)(i), (h)(ii) and (h)(iii) of this
Exhibit C, any legal or other fees, charges or expenses reasonably incurred by
such party in connection with any investigation or proceeding.  The parties
hereto agree that it would not be just and equitable if contribution pursuant to
this paragraph were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to in the immediately preceding paragraph.  No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
 
(i)           Rule 144. The Company covenants that from the Effective Time and
thereafter for so long as the Investor Beneficially Owns Registrable Shares, the
Company shall use commercially reasonable efforts to (a) file any reports
required to be filed by it under the Exchange Act and (b) take such further
action as Investor may
 
 
 
C-7

--------------------------------------------------------------------------------

 
 
reasonably request (including providing any information necessary to comply with
Rule 144 under the Securities Act), all to the extent required from time to time
to enable Investor to sell Registrable Shares without registration under the
Securities Act within the limitation of the exemptions provided by (i) Rule 144
under the Securities Act, as such rule may be amended from time to time, or
Regulation S under the Securities Act or (ii) any similar rules or regulations
hereafter adopted by the SEC.
 
(j)           Registration Procedures.  Whenever the Investor demands that any
Registrable Shares be registered pursuant to paragraph (a), subject to the
provisions of such Sections, the Company shall use its commercially reasonable
efforts to effect the registration and the sale of such Registrable Shares in
accordance with the intended method of disposition thereof as quickly as
practicable, and, in connection with any such request:
 
(i)           Prior to filing a Registration Statement or prospectus or any
amendment or supplement thereto, the Company shall, if requested, furnish to the
Investor and each underwriter, if any, of the Registrable Shares covered by such
Registration Statement copies of such Registration Statement as proposed to be
filed, and thereafter the Company shall furnish to the Investor and underwriter,
if any, such number of copies of such Registration Statement and such other
documents as the Investor or underwriter may reasonably request in order to
facilitate the disposition of the Registrable Shares.  The Investor shall have
the right to request that the Company modify any information contained in such
Registration Statement thereto pertaining to the Investor and the Company shall
use its commercially reasonable efforts to comply with such request; provided,
however, that the Company shall not have any obligation so to modify any
information if the Company reasonably expects that so doing would cause the
Registration Statement to contain an untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading.
 
(ii)          After the filing of the Registration Statement, the Company shall
(A) cause the related prospectus to be supplemented by any required prospectus
supplement, and, as so supplemented, to be filed pursuant to Rule 424 under the
Securities Act, (B) comply with the provisions of the Securities Act with
respect to the disposition of all Securities covered by such registration
statement during the applicable period in accordance with the intended methods
of disposition by the Shareholders thereof set forth in such registration
statement or supplement to such prospectus and (C) promptly notify the Investor
of any stop order issued or threatened by the SEC or any state securities
commission and take all reasonable actions required to prevent the entry of such
stop order or to remove it if entered.
 
(iii)         The Company shall use its commercially reasonable efforts to
register or qualify the Registrable Shares covered by any Registration Statement
under such other securities or “blue sky” laws of such jurisdictions in the
United States as the Investor reasonably (in light of the Investor’s intended
plan of distribution) requests and do any and all other acts and things that may
be reasonably necessary or advisable to enable the Investor to consummate the
disposition in such jurisdictions of the Registrable
 
 
 
C-8

--------------------------------------------------------------------------------

 
 
Shares; provided that the Company shall not be required to (x) qualify generally
to do business in any jurisdiction where it would not otherwise be required to
qualify but for this paragraph (j)(iii), (y) subject itself to taxation in any
such jurisdiction or (z) consent to general service of process in any such
jurisdiction.
 
(iv)         The Company shall promptly notify the Investor when a prospectus
relating thereto is required to be delivered under the Securities Act, of the
occurrence of an event requiring the preparation of a supplement or amendment to
such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Shares, such prospectus will not contain an untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading and promptly prepare
and make available to each such Shareholder and file with the SEC any such
supplement or amendment.
 
(v)          The Investor shall have the right, in its reasonable discretion, to
select an underwriter or underwriters reasonably acceptable to the Company in
connection with any public offering resulting from the exercise by the Investor
of a Demand Registration.  In connection with any public offering, the Company
shall enter into customary agreements (including an underwriting agreement in
form reasonably acceptable to the Company) and use commercially reasonable
efforts to take such all other actions in connection therewith as are reasonably
required in order to expedite or facilitate the disposition of such Registrable
Shares, including the engagement of a “qualified independent underwriter” in
connection with the qualification of the underwriting arrangements with FINRA.
 
(vi)        Upon execution of confidentiality agreements in form and substance
reasonably satisfactory to the Company, the Company shall make available for
inspection by the Investor and any underwriter participating in any disposition
pursuant to a Registration Statement being filed by the Company and any
attorney, accountant or other professional retained by any such Shareholder or
underwriter (collectively, the “Inspectors”), all relevant financial and other
records, pertinent corporate documents and properties of the Company
(collectively, the “Records”) as shall be reasonably necessary to enable them to
exercise their due diligence responsibility, and cause the Company’s officers,
directors and employees to supply all information reasonably requested by any
Inspectors in connection with such registration statement.  Records that the
Company determines, in good faith, to be confidential and that it notifies the
Inspectors are confidential shall not be disclosed by the Inspectors unless (A)
the disclosure of such Records is necessary to avoid or correct a misstatement
or omission in such Registration Statement or (B) the release of such Records is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction.  The Investor further agrees that, upon learning that disclosure
of such Records is sought in a court of competent jurisdiction, it shall give
notice to the Company and allow the Company, at its expense, to undertake
appropriate action to prevent disclosure of the Records deemed confidential.
 
(vii)        The Company shall furnish to the Investor and to each underwriter,
if any, a signed counterpart, addressed to the Investor or such underwriter, of
(A) an opinion or opinions of counsel to the Company and (B) a comfort letter or
comfort
 
 
 
C-9

--------------------------------------------------------------------------------

 
 
 
letters from the Company’s independent public accountants, each in customary
form and covering such matters of the kind customarily covered by such opinions
or comfort letters, as the case may be, as the Investor or the managing
underwriter therefor reasonably requests.
 
(viii)       The Company shall otherwise use its commercially reasonable efforts
to comply with all applicable rules and regulations of the SEC, and make
available to its security holders, as soon as reasonably practicable, an
earnings statement or such other document that shall satisfy the provisions of
Section 11(a) of the Securities Act and the requirements of Rule 158 thereunder.
 
(ix)         The Company shall use its commercially reasonable efforts to list
all Registrable Shares covered by such registration statement on any securities
exchange or quotation system on which any of the Registrable Shares are then
listed or traded.
 
(x)          At the Investor’s request, the Company shall have appropriate
officers of the Company (A) prepare and make presentations at “road shows” or
other meetings with analysts and rating agencies; provided that the Company
shall not be required to have appropriate officers of the Company prepare and
make presentations at more than two (2) “road shows” in any twelve (12)-month
period, (B) take other reasonable actions to obtain ratings for any Registrable
Shares and (C) otherwise use their commercially reasonable efforts to cooperate
as reasonably requested by the underwriters in the offering, marketing or
selling of the Registrable Shares.
 
(k)           Further Assurances.  Each of the Parties shall, and shall cause
their respective Affiliates to, execute such documents and perform such further
acts as may be reasonably required or desirable to carry out or to perform the
provisions of this Exhibit C. For the avoidance of doubt, nothing in this
Exhibit C shall diminish or otherwise modify any of the Investor’s obligations
under Article IV of the Agreement.
 

 

C-10

--------------------------------------------------------------------------------