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Bond.doc Page 1
JANUS INVESTMENT FUND
INVESTMENT ADVISORY AGREEMENT
JANUS SHORT-TERM BOND FUND
THIS INVESTMENT ADVISORY AGREEMENT (the "Agreement") is made this
3rd day of April, 2002, between JANUS INVESTMENT FUND, a Massachusetts
business trust (the "Trust"), and JANUS CAPITAL MANAGEMENT LLC, a Delaware
limited liability company ("JCM").
W I T N E S S E T H:
WHEREAS, the Trust is registered as an open-end management
investment company under the Investment Company Act of 1940, as amended
(the "1940 Act"), and has registered its shares for public offering under
the Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Trust is authorized to create separate funds, each
with its own separate investment portfolio of which the beneficial interests
are represented by a separate series of shares; one of such funds
created by the Trust being designated as the Janus Short-Term Bond Fund (the
"Fund"); and
WHEREAS, the Trust and JCM deem it mutually advantageous that JCM
should assist the Trustees and officers of the Trust in the management of
the securities portfolio of the Fund.
NOW, THEREFORE, the parties agree as follows:
1. Investment Advisory Services. JCM shall furnish continuous
advice and recommendations to the Fund as to the acquisition, holding, or
disposition of any or all of the securities or other assets which the Fund may
own or contemplate acquiring from time to time. JCM shall give due
consideration to the investment policies and restrictions and the other
statements concerning the Fund in the Trust Instrument, bylaws, and
registration statements under the 1940 Act and the 1933 Act, and to the
provisions of the Internal Revenue Code, as amended from time to time,
applicable to the Fund as a regulated investment company. In addition, JCM
shall cause its officers to attend meetings and furnish oral or written
reports, as the Trust may reasonably require, in order to keep the Trustees
and appropriate officers of the Trust fully informed as to the condition of
the investment portfolio of the Fund, the investment recommendations of JCM,
and the investment considerations which have given rise to those
recommendations. JCM shall supervise the purchase and sale of securities as
directed by the appropriate officers of the Trust.
2. Other Services. JCM is hereby authorized (to the
extent the Trust has not otherwise contracted) but not obligated (to the
extent it so notifies the Trustees at least 60 days in advance), to perform
(or arrange for the performance by affiliates of) the management and
administrative services necessary for the operation of the Fund. JCM is
specifically authorized, on behalf of the Trust, to conduct relations
with custodians, depositories, transfer and pricing agents, accountants,
attorneys, underwriters, brokers and dealers, corporate fiduciaries,
insurance company separate accounts, insurers, banks and such other persons
in any such other capacity deemed by JCM to be necessary or desirable. JCM
shall generally monitor and report to the Fund's officers the Fund's
compliance with investment policies and restrictions as set forth in the
currently effective prospectus and statement of additional information
relating to the shares of the Fund under the Securities Act of 1933, as amended.
JCM shall make reports to the Trustees of its performance of services
hereunder upon request therefor and furnish advice and recommendations with
respect to such other aspects of the business and affairs of the Fund as it
shall determine to be desirable. JCM is also authorized, subject to review
by the Trustees, to furnish such other services as JCM shall from time to
time determine to be necessary or useful to perform the services
contemplated by this Agreement.
3. Obligations of Trust. The Trust shall have the following
obligations under this Agreement:
(a) to keep JCM continuously and fully informed as to
the composition of its investment portfolio and the
nature of all of its assets and liabilities from time
to time;
(b) to furnish JCM with a certified copy of any financial
statement or report prepared for it by certified or
independent public accountants and with copies of
any financial statements or reports made to its
shareholders or to any governmental body or
securities exchange;
(c) to furnish JCM with any further materials or
information which JCM may reasonably request to
enable it to perform its function under this
Agreement; and
(d) to compensate JCM for its services and reimburse
JCM for its expenses incurred hereunder in accordance
with the provisions hereof.
4. Compensation. The Trust shall pay to JCC for its
investment advisory services a fee, calculated and payable for each day that
this Agreement is in effect, of 1/365 of 0.65% of the first $300,000,000
of the daily closing net asset value of the Fund, plus 1/365 of 0.55% of the
daily closing net asset value in excess of $300,000,000 (or 1/366 of either
rate in a leap year). The fee shall be paid monthly.
5. Expenses Borne by JCM. In addition to the expenses which
JCM may incur in the performance of its investment advisory functions
under this Agreement, and the expenses which it may expressly undertake to
incur and pay under other agreements with the Trust or otherwise, JCM shall
incur and pay the following expenses relating to the Fund's operations without
reimbursement from the Fund:
(a) Reasonable compensation, fees and related expenses
of the Trust's officers and its
Trustees, except for such Trustees who are not
interested persons of JCM; and
(b) Rental of offices of the Trust.
6. Expenses Borne by the Trust. The Trust assumes and shall
pay all expenses incidental to its organization, operations and business not
specifically assumed or agreed to be paid by JCM pursuant to Sections 2 and 5
hereof, including, but not limited to, investment adviser fees; any
compensation, fees, or reimbursements which the Trust pays to its Trustees who
are not interested persons of JCM; compensation of the Fund's custodian,
transfer agent, registrar and dividend disbursing agent; legal,
accounting, audit and printing expenses; administrative, clerical,
recordkeeping and bookkeeping expenses; brokerage commissions and all other
expenses in connection with execution of portfolio transactions (including
any appropriate commissions paid to JCM or its affiliates for effecting
exchange listed, over-the-counter or other securities transactions);
interest; all federal, state and local taxes (including stamp, excise, income
and franchise taxes); costs of stock certificates and expenses of delivering
such certificates to purchasers thereof; expenses of local representation
in Massachusetts; expenses of shareholders' meetings and of preparing,
printing and distributing proxy statements, notices, and reports to
shareholders; expenses of preparing and filing reports and tax returns with
federal and state regulatory authorities; all expenses incurred in complying
with all federal and state laws and the laws of any foreign country applicable
to the issue, offer, or sale of shares of the Fund, including, but not limited
to, all costs involved in the registration or qualification of shares of the
Fund for sale in any jurisdiction, the costs of portfolio pricing services
and compliance systems, and all costs involved in preparing, printing and
mailing prospectuses and statements of additional information to fund
shareholders; and all fees, dues and other expenses incurred by the Trust in
connection with the membership of the Trust in any trade association or other
investment company organization.
7. Treatment of Investment Advice. The Trust shall
treat the investment advice and recommendations of JCM as being advisory
only, and shall retain full control over its own investment policies.
However, the Trustees may delegate to the appropriate officers of the Trust,
or to a committee of the Trustees, the power to authorize purchases, sales or
other actions affecting the portfolio of the Fund in the interim
between meetings of the Trustees.
8. Termination. This Agreement may be terminated at any time,
without penalty, by the Trustees of the Trust, or by the shareholders of the
Fund acting by vote of at least a majority of its outstanding voting
securities, provided in either case that sixty (60) days advance written
notice of termination be given to JCM at its principal place of business. This
Agreement may be terminated by JCM at any time, without penalty, by giving
sixty (60) days advance written notice of termination to the Trust,
addressed to its principal place of business. The Trust agrees that,
consistent with the terms of the Trust Instrument, the Trust shall cease to use
the name "Janus" in connection with the Fund as soon as reasonably practicable
following any termination of this Agreement if JCM does not continue to provide
investment advice to the Fund after such termination.
9. Assignment. This Agreement shall terminate automatically
in the event of any assignment of this Agreement.
10. Term. This Agreement shall continue in effect until July 1,
2002, unless sooner terminated in accordance with its terms, and shall
continue in effect from year to year thereafter only so long as such
continuance is specifically approved at least annually by the vote of a
majority of the Trustees of the Trust who are not parties hereto or
interested persons of any such party, cast in person at a meeting called
for the purpose of voting on the approval of the terms of such renewal, and
by either the Trustees of the Trust or the affirmative vote of a majority of
the outstanding voting securities of the Fund. The annual approvals provided
for herein shall be effective to continue this Agreement from year to year if
given within a period beginning not more than ninety (90) days prior to July 1
of each applicable year, notwithstanding the fact that more than three
hundred sixty-five (365) days may have elapsed since the date on which such
approval was last given.
11. Amendments. This Agreement may be amended by the
parties only if such amendment is specifically approved (i) by a
majority of the Trustees, including a majority of the Trustees who are
not interested persons (as that phrase is defined in Section 2(a)(19) of
the 0000 Xxx) of JCM and, if required by applicable law, (ii) by the
affirmative vote of a majority of the outstanding voting securities of the
Fund (as that phrase is defined in Section 2(a)(42) of the 1940 Act).
12. Other Series. The Trustees shall determine the basis for
making an appropriate allocation of the Trust's expenses (other than those
directly attributable to the Fund) between the Fund and the other series
of the Trust.
13. Limitation of Personal Liability. All the parties hereto
acknowledge and agree that all liabilities of the Trust arising, directly
or indirectly, under this Agreement, of any and every nature whatsoever,
shall be satisfied solely out of the assets of the Fund and that no Trustee,
officer or holder of shares of beneficial interest of the Trust shall be
personally liable for any of the foregoing liabilities. The Trust Instrument
describes in detail the respective responsibilities and limitations on
liability of the Trustees, officers and holders of shares of beneficial
interest of the Trust.
14. Limitation of Liability of JCM. JCM shall not be liable
for any error of judgment or mistake of law or for any loss arising out of any
investment or for any act or omission taken with respect to the Trust,
except for willful misfeasance, bad faith or gross negligence in the
performance of its duties, or by reason of reckless disregard of its
obligations and duties hereunder and except to the extent otherwise provided
by law. As used in this Section 14, "JCM" shall include any affiliate
of JCM performing services for the Trust contemplated hereunder and
directors, officers and employees of JCM and such affiliates.
15. Activities of JCM. The services of JCM to the Trust
hereunder are not to be deemed to be exclusive, and JCM and its affiliates
are free to render services to other parties. It is understood that
trustees, officers and shareholders of the Trust are or may become interested
in JCM as directors, officers and shareholders of JCM, that directors,
officers, employees and shareholders of JCM are or may become similarly
interested in the Trust, and that JCM may become interested in the Trust as a
shareholder or otherwise.
16. Certain Definitions. The terms "vote of a majority of the
outstanding voting securities," "assignment" and "interested persons" when
used herein, shall have the respective meanings specified in the 1940 Act, as
now in effect or hereafter amended, and the rules and regulations
thereunder, subject to such orders, exemptions and interpretations as may be
issued by the Securities and Exchange Commission under said Act and as
may be then in effect.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Investment Advisory Agreement as of the date and year
first above written.
JANUS CAPITAL MANAGEMENT LLC
By: Xxxxxx X. Early, Vice President
JANUS INVESTMENT FUND
By: Xxxxxx Xxxxxx Xxxxx, Vice President
