EXHIBIT 10.3
NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
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2004 EMPLOYMENT INDUCEMENT AWARD PLAN OF
JANUS CAPITAL GROUP INC.
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By this Agreement, Janus Capital Group Inc. (the "Company"), a Delaware
corporation, grants to Xxxx X. Xxxxxx (the "Grantee"), an employee of the
Company or a Subsidiary (i) a non-qualified stock option (the "Option") to
purchase that number of shares ("Shares") of the Company's Common Stock, $.01
par value, set forth below and (ii) an equal number of limited stock
appreciation rights ("LSARs"), all subject to the terms and conditions set forth
below, in the attached Exhibit A hereto and in the Janus Capital Group Inc. 2004
Employment Inducement Award Plan, as may from time to time be amended (the
"Plan"), all of which are an integral part of this Agreement. A copy of the Plan
is attached. Capitalized terms used but not defined in this Agreement have the
meaning specified in the Plan.
GRANT DATE: AUGUST 23, 2004
NUMBER OF SHARES: 78,989
OPTION PRICE: $13.59
This Option shall become exercisable as follows, provided you remain
continuously employed by the Company or a Subsidiary that is consolidated with
the Company for financial reporting purposes (a "Consolidated Subsidiary") from
the Grant Date to such date.
DATE FIRST EXERCISABLE NUMBER OF OPTIONS
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06/30/2005 26,330
06/30/2006 26,330
06/30/2007 26,329
The term of the Option shall be ten (10) years from the Grant Date
unless terminated earlier as provided in Exhibit A, Exhibit B or in the Plan.
Please indicate your acceptance of this Agreement by signing the
enclosed copy in the space provided below and returning it to the Corporate
Secretary's Office, in the envelope provided, within 30 days after the Company's
mailing of this Agreement to you. This Option shall not be exercisable prior to
your signing this Agreement and returning it to the Company.
I agree to be bound by the terms, conditions and provisions of the Plan
and this Agreement. I understand that by signing this Agreement I am not
obligated to exercise all or any part of this Option or any other Option.
JANUS CAPITAL GROUP INC.
By: /s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx, Assistant Corporate Secretary
ACCEPTED AND AGREED:
/s/ Xxxx X. Xxxxxx Dated: 9/20 , 2004
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Signature
Xxxx X. Xxxxxx SSN ###-##-####
000 Xxxxxxx Xxxxxx JCG
Xxxxxx, Xxxxxxxx 00000
(RETURN ONE COPY OF THIS AGREEMENT IN THE ENCLOSED SELF-ADDRESSED ENVELOPE.
RETAIN ONE COPY FOR YOUR RECORDS.) PLEASE SEE REVERSE SIDE TO COMPLETE
BENEFICIARY INFORMATION.
EXHIBIT A
TO
STOCK OPTION AWARD AGREEMENT
1. MANNER OF EXERCISE. This Option shall be exercised by delivering to
the Company (or its authorized agent), during the period in which such Option is
exercisable, (i) a written notice of your intent to purchase a specific number
of Shares pursuant to this Option (a "Notice of Exercise"), and (ii) full
payment of the Option Price for such specific number of Shares. Payment may be
made by any one or more of the following means:
(a) cash or personal check; or
(b) if approved and permitted by the Committee, through the
delivery of Shares having a Fair Market Value on the day of exercise
equal to such Option Price (the number of Shares may be initially
estimated using the Fair Market Value on the last stock trading day
preceding the exercise day, with a true-up of any differential
effective as of the exercise date), which shares either (i) have been
owned by you for at least six months ("Mature Shares") or (ii) were
purchased by you on the open market. Certificates for Shares shall be
properly endorsed with signatures guaranteed (unless such signature
guarantee is waived by an officer of the Company), and shall represent
Shares which are fully paid, non-assessable, and free and clear from
all liens and encumbrances; or
(c) if approved and permitted by the Committee, through the
sale of the Shares acquired on exercise of this Option through a broker
to whom you have submitted irrevocable instructions to deliver promptly
to the Company the amount of sale or loan proceeds sufficient to pay
for such Shares, together with, if required by the Company, the amount
of federal, state, local or foreign withholding taxes payable by reason
of such exercise. A copy of such delivery instructions must also be
delivered to the Company by the Grantee with the Notice of Exercise.
The exercise of the Option shall become effective at the time such a Notice of
Exercise has been received by the Company, which must be before the tenth
anniversary of the Grant Date (the "Expiration Date"). The exercise of this
Option as to a number of Shares will result in the cancellation of an equal
number of LSARs. You will not have any rights as a stockholder of the Company
with respect to the Shares deliverable upon exercise of this Option until a
certificate for such Shares is delivered to you.
If the Option is exercised as permitted herein by any person or persons
other than Grantee, such Notice of Exercise shall be accompanied by such
documentation as the Company may reasonably require, including without
limitation, evidence of the authority of such person or persons to exercise the
Option and evidence satisfactory to the Company that any death taxes payable
with respect to such Shares have been paid or provided for.
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2. EXERCISABILITY. This Option shall become fully exercisable upon your
termination of employment with the Company or a Consolidated Subsidiary on
account of (a) Retirement, (b) death, (c) Disability or (d) termination by the
Company or a Consolidated Subsidiary other than for Cause.
3. CHANGE OF CONTROL. This Option shall become fully exercisable upon a
Change of Control (as defined on Exhibit B hereto). Upon a Change of Control,
all LSARs then outstanding shall automatically be exercised and this Option
shall be canceled.
4. EXERCISE AFTER TERMINATION OF AFFILIATION. This Option may be
exercised only while you are employed by the Company or a Consolidated
Subsidiary, except that this Option may also be exercised after the date on
which you cease to be so employed ("Termination Date") as follows:
(i) if you have a Termination of Affiliation on account of
Retirement, you may also exercise this Option at any time during the
first five years after your Termination Date;
(ii) if you have a Termination of Affiliation on account of
Disability, you may also exercise this Option at any time during the
first 12 months after your Termination Date;
(iii) if you have a Termination of Affiliation on account of
death, the executor or administrator of your estate, your heirs or
legatees, or beneficiary designated in accordance with the Plan, as
applicable, may also exercise this Option at any time during the first
12 months after your Termination Date; and
(iv) if you have a Termination of Affiliation on account of
any other reason (other than a dismissal for Cause), you may also
exercise this Option at any time during the first three months after
your Termination Date;
provided, however, that (x) except as otherwise provided in Section 2 or 3 of
this Exhibit A, this Option may be exercised after your Termination Date only to
the extent it is exercisable on the Termination Date, (y) under no circumstances
may this Option be exercised on or after the Expiration Date, and (z) the
expiration of your Option will automatically result in the expiration of all
associated LSARs. For purposes of this Section 4, if you are employed by a
corporation or limited liability company ("LLC") that is a Consolidated
Subsidiary of the Company, you will be deemed to have had a Termination of
Affiliation as of the first day on which such corporation or LLC ceases to be a
Consolidated Subsidiary of the Company.
5. AFFILIATION WITH COMPETITOR. Notwithstanding anything to the
contrary contained herein, if Grantee, without Company's consent, becomes
associated with, employed by, renders service to, or owns any interest in (other
than any non-substantial interest, as the Committee from
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time to time determines) any business that is in competition with Company or any
Affiliate (as defined below), this Option shall terminate and cease to be
exercisable immediately upon such event. For purposes of this paragraph,
Affiliate means (i) any individual or entity that directly, or through one or
more intermediaries, controls, or is controlled by, or is under common control
with, the Company, and (ii) any entity in which the Company owns, directly or
indirectly, 20% or more of the combined value of all equity interests.
6. NO WAIVER. The failure of the Company in any instance to exercise
any of its rights granted under this Agreement or the Plan shall not constitute
a waiver of any other rights that may arise under this Agreement.
7. LIMITED TRANSFERABILITY OF OPTION. Except as provided in the
immediately following sentence, this Option is exercisable during your lifetime
only by you or your guardian or legal representative, and this Option and the
associated LSARs are not transferable except by will or the laws of descent and
distribution. To the extent and in the manner permitted by the Committee, and
subject to such terms, conditions, restrictions or limitations that may be
prescribed by the Committee, you may transfer this Option and the associated
LSARs to (i) your spouse, sibling, parent, child (including an adopted child) or
grandchild (any of which an "Immediate Family Member"); (ii) a trust, the
primary beneficiaries of which consist exclusively of you or your Immediate
Family Members; or (iii) a corporation, partnership or similar entity, the
owners of which consist exclusively of you or your Immediate Family Members.
8. FRACTIONAL OR DE MINIMIS SHARES. Neither the Option nor the LSARs
shall be exercisable with respect to a fractional share or with respect to fewer
that ten (10) Shares, unless the remaining Shares, are fewer than ten (10)).
9. NONSTATUTORY OPTION. This Option has been designated by the
Committee as a Nonstatutory Option; it does not qualify as an incentive stock
option.
10. TAXES.
(a) The Company is not required to issue Shares upon the
exercise of this Option unless you first pay to the Company such
amount, if any, as may be required by the Company to satisfy any
liability it may have to withhold federal, state, local or foreign
income or other taxes relating to such exercise. You may elect to
satisfy such tax withholding obligation by delivering to the Company a
written irrevocable election to have the Company withhold a portion of
the Shares purchased upon exercise of the Option having a Fair Market
Value equal to the amount of taxes required to be withheld; provided,
however, that the Committee may, at any time before you file such an
election with the Company, revoke your right to make such an election.
(b) In addition, you may deliver Mature Shares to the Company
to satisfy your federal, state and local withholding tax liability
above the minimum amount of taxes
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required to be withheld by the Company, up to your maximum tax
liability arising from the exercise of the Option; the Committee
retains the right, in its sole discretion, to disapprove any particular
delivery of shares of Common Stock and the Committee may, at any time
before the delivery of such shares revoke your right to make such
delivery.
11. ATTESTATION TO OWNERSHIP OF MATURE SHARES. Whenever under this
Agreement you have the right to deliver Mature Shares to the Company for payment
of the Option Price pursuant to Section 1(b) or for taxes in excess of the
minimum amount of taxes required to be withheld by the Company pursuant to
Section 10(b), in lieu of physically delivering such shares to the Company, you
may elect to deliver to the Company an affidavit and such other documents
attesting to ownership of such Mature Shares in such form as is prescribed by
the Company from time to time.
12. AMENDMENTS. This Agreement may be amended only by a writing
executed by the Company and you which specifically states that it is amending
this Agreement; provided that this Agreement is subject to the power of the
Board to amend the Plan as provided therein, except that no such amendment shall
adversely affect your rights under this Agreement without your consent.
13. NOTICES. Any notice to be given under the terms of this Agreement
to the Company shall be addressed to the Company at its principal office, in
care of its Corporate Secretary. Any notice to be given to you shall be
addressed to you at the address listed in the Company's records. By a notice
given pursuant to this Section, either party may designate a different address
for notices. Any notice shall have been deemed given (i) when actually delivered
to the Company, or (ii) if to the Grantee, when actually delivered or deposited
in the U.S. Mail, postage prepaid and properly addressed to the party to be
notified.
14. SEVERABILITY. If any part of this Agreement is declared by any
court or governmental authority to be unlawful or invalid, such unlawfulness or
invalidity shall not serve to invalidate any part of this Agreement not declared
to be unlawful or invalid. Any part so declared unlawful or invalid shall, if
possible, be construed in a manner which gives effect to the terms of such part
to the fullest extent possible while remaining lawful and valid.
15. APPLICABLE LAW. This Agreement shall be construed in accordance
with and governed by the laws of the State of
Delaware other than its laws
respecting choice of law.
16. HEADINGS. Headings are provided herein for convenience only and are
not to serve as a basis for interpretation or construction of this Agreement.
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EXHIBIT B
TO
STOCK OPTION AWARD AGREEMENT
A "Change Of Control" shall mean the first to occur of any of the following:
(1) An acquisition by any Person of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act") of 35% or more of either (A) the
then outstanding shares of common stock of the Company (the
"Outstanding Company Common Stock") or (B) the combined voting power of
the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Outstanding Company Voting
Securities"); excluding, however, the following: (i) any acquisition by
the Company; (ii) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any entity
controlled by the Company; or (iii) any acquisition pursuant to a
transaction which complies with clauses (A), (B) and (C) of subsection
(3) of this definition; or
(2) A change in the composition of the Company's Board of Directors (the
"Board") such that the individuals who, as of the first day of any
two-year period (the "Determination Date"), constitute the Board (such
Board shall be hereinafter referred to as the "Incumbent Board") cease
for any reason to constitute at least a majority of the Board as of any
date prior to the second anniversary of the Determination Date;
provided, however, for purposes of this definition, that any individual
who becomes a member of the Board subsequent to the effective date
hereof, whose election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a majority of those
individuals who are members of the Board and who were also members of
the Incumbent Board (or deemed to be such pursuant to this proviso)
shall be considered as though such individual were a member of the
Incumbent Board; but, provided further, that any such individual whose
initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other accrual or
threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board shall not be so considered as a member of
the Incumbent Board; or
(3) Consummation of a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets of the
Company or the acquisition of the assets or stock of another entity
("Business Combination"); excluding, however, such a Business
Combination pursuant to which (A) all or substantially all of the
individuals and entities who are the beneficial owners, respectively,
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such Business Combination (the "Company
Holders") will each beneficially own, directly or indirectly, the
outstanding shares of common stock and other voting securities entitled
to vote generally in the election of directors, as the case may be, of
the corporation resulting from such Business Combination (including,
without limitation, a corporation which as a result of such transaction
owns the Company or all or substantially all the Company's assets
either directly or through one or more subsidiaries) in substantially
the same proportions (relative to the other Company Holders) as their
ownership, immediately
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prior to such Business Combination, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be;
(B) no Person (other than the Company or any employee benefit plan (or
related trust) of the Company or the corporation resulting from such
Business Combination) will beneficially own, directly or indirectly,
35% or more of, respectively, the outstanding shares of common stock of
the corporation resulting from such Business Combination or the
combined voting power of the outstanding voting securities of such
corporation entitled to vote generally in the election of directors
except to the extent that such ownership existed prior to the Business
Combination; and (C) individuals who were members of the Incumbent
Board will constitute at least a majority of the members of the board
of directors of the corporation resulting form such Business
Combination; or
(4) The approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.
For purposes of this definition, "person" shall mean any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).
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