Registration No. 2-34393
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. /__/
Post-Effective Amendment No. 81 /X/
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940
Amendment No. 64 /X/
(Check appropriate box or boxes.)
JANUS INVESTMENT FUND
(Exact Name of Registrant as Specified in Charter)
100 Fillmore Street, Denver, Colorado 80206-4928
Address of Principal Executive Offices (Zip Code)
Registrant's Telephone No., including Area Code: 303-333-3863
Stephen L. Stieneker - 100 Fillmore Street, Denver, Colorado 80206-4928
(Name and Address of Agent for Service)
Approximate Date of Proposed Offering: June 26, 1997
It is proposed that this filing will become effective (check appropriate line):
X immediately upon filing pursuant to paragraph (b) of Rule 485.
on (date) pursuant to paragraph (b) of Rule 485.
60 days after filing pursuant to paragraph (a)(1) of Rule 485.
on (date) pursuant to paragraph (a)(1) of Rule 485.
75 days after filing pursuant to paragraph (a)(2) of Rule 485.
on (date) pursuant to paragraph (a)(2) of Rule 485.
If appropriate, check the following line:
this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
Registrant has registered an indefinite number of shares of beneficial interest
under the Securities Act of 1933 pursuant to Rule 24f-2(a) and filed a Rule
24f-2 Notice on December 13, 1996, for the fiscal year ended October 31, 1996,
with respect to all of its series and classes in existence as of October 31,
1996.
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JANUS INVESTMENT FUND
(Janus Special Situations Fund)
Cross Reference Sheet
Between the Prospectus and Statement of
Additional Information and Form N-1A Item
(Cross Reference Sheet for Other Series of Janus Investment Fund are
included in a previous post-effective amendment relating to those series)
FORM N-1A ITEM CAPTION IN PROSPECTUS
PART A
1. Cover Page Cover Page
2. Synopsis Cover Page; Fund at a Glance; Expense
Information
3. Condensed Financial Financial Highlights; Performance Terms
Information
4. General Description of Fund at a Glance; The Fund in Detail;
Registrant Investment Objective and Strategy; Types
of Investments; General Portfolio
Policies; Additional Risk Factors;
Appendix A - Glossary of Investment
Terms; Appendix B - Explanation of
Rating Categories
5. Management of the Fund Management of the Fund
5A. Management's Discussion of Not Applicable
Fund Performance
6. Capital Stock and Other Distributions and Taxes; Shareholder's
Securities Manual
7. Purchase of Securities Being Shareholder's Manual
Offered
8. Redemption or Repurchase Shareholder's Manual
9. Pending Legal Proceedings Not Applicable
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FORM N-1A ITEM CAPTION IN STATEMENT OF
ADDITIONAL INFORMATION
PART B
10. Cover Page Cover Page
11. Table of Contents Table of Contents
12. General Information and Miscellaneous Information
History
13. Investment Objectives and Investment Policies, Restrictions and
Policies Techniques; Types of Securities and
Investment Techniques
14. Management of the Fund Investment Adviser; Officers and
Trustees
15. Control Persons and Principal Principal Shareholders
Holders of Securities
16. Investment Advisory and Investment Adviser; Custodian, Transfer
Other Services Agent and Certain Affiliations;
Portfolio Transactions and Brokerage;
Officers and Trustees; Miscellaneous
Information
17. Brokerage Allocation and Portfolio Transactions and Brokerage
Other Practices
18. Capital Stock and Other Purchase of Shares; Redemption of
Securities Shares; Miscellaneous Information
19. Purchase, Redemption and Purchase of Shares; Redemption of
Pricing of Securities Being Shares; Shareholder Accounts
Offered
20. Tax Status Income Dividends, Capital Gains
Distributions and Tax Status
21. Underwriters Custodian, Transfer Agent and Certain
Affiliations
22. Calculation of Performance Performance Information
Data
23. Financial Statements Financial Statements
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JANUS INVESTMENT FUND
JANUS SPECIAL SITUATIONS FUND
Supplement Dated June 26, 1997 to Prospectus Dated November 29, 1996
THIS SUPPLEMENT IS INTENDED TO BE USED WITH THE PROSPECTUS DATED NOVEMBER 29,
1996, AND REPLACES THE SUPPLEMENT DATED DECEMBER 12, 1996. THIS SUPPLEMENT,
TOGETHER WITH THE PROSPECTUS PREVIOUSLY FURNISHED TO YOU, CONSTITUTE A CURRENT
PROSPECTUS. TO REQUEST ANOTHER COPY OF THE PROSPECTUS, PLEASE CALL
1-800-525-3713.
I. The address on the inside front cover of the Prospectus is amended as
follows:
100 Fillmore Street
Denver, CO 80206-4928
1-800-525-3713
http://www.Janus.com
II. The following table is added at page 2 of the Prospectus:
FINANCIAL HIGHLIGHTS
The unaudited information below is for the fiscal period from December 31, 1996
(inception) to April 30, 1997.
<TABLE>
Janus Special Situations Fund
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<S> <C>
1. Net asset value, beginning of period $10.00
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Income from investment operations:
2. Net investment income --
3. Net gains or (losses) on securities (both realized and unrealized) .82
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4. Total from investment operations .82
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Less distributions:
5. Dividends (from net investment income) --
6. Distributions (from capital gains) --
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7. Total distributions --
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8. Net asset value, end of period $10.82
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9. Total return* 8.30%
10. Net assets, end of period (in millions) $124
11. Average net assets for the period (in millions) $91
12. Ratio of gross expenses to average net assets** 1.34%
13. Ratio of net expenses to average net assets** 1.32%
14. Ratio of net investment income to average net assets** 0.13%
15. Portfolio turnover rate** 140%
16. Average commission rate $.0423
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</TABLE>
*Total return is not annualized.
**Annualized.
III. The "Express or Certified Mail" address in the section "How to Open Your
Janus Account" on page 7 of the Prospectus and the section "Quick Address
and Telephone Reference" on page 8 of the Prospectus are amended as
follows:
For Overnight Carrier
Janus
Suite 101
3773 Cherry Creek North Drive
Denver, CO 80209-3811
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IV. The second paragraph of the section "Investment Adviser" on page 11 of the
Prospectus is amended as follows: Janus Capital began serving as investment
adviser to certain series of the Trust in 1970 and currently serves as
investment adviser to all of the Janus funds, as well as adviser or
subadviser to other mutual funds and individual, corporate, charitable and
retirement accounts.
V. The management fee schedule in the section "Breakdown of Management
Expenses and Expense Limits" on page 11 of the Prospectus is amended as
follows:
As of July 1, 1997, management fees will accrue at the following rates:
0.75% on the first $300 million in assets; 0.70% on the next $200 million
in assets; and 0.65% on assets in excess of $500 million.
VI. The "Custodian" paragraph of the section "Other Service Providers" on page
12 of the Prospectus is amended as follows:
Custodian
State Street Bank and Trust Company
P.O. Box 0351
Boston, Massachusetts 02117-0351
VII. The first paragraph of the section "Distributions" on page 13 of the
Prospectus is amended as follows:
To avoid taxation, the Internal Revenue Code requires the Fund to
distribute net income and any net gains realized by its investments
annually. The Fund's income from dividends and interest and any net
realized short-term capital gains are paid to shareholders as ordinary
income dividends. Net realized long-term gains are paid to shareholders as
capital gains distributions. Dividends and capital gains distributions are
declared and paid in December.
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JANUS SPECIAL SITUATIONS FUND
100 Fillmore Street
Denver, CO 80206-4928
(800) 525-3713
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Statement of Additional Information
November 29, 1996 as supplemented June 26, 1997
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Janus Special Situations Fund (the "Fund") is a no-load mutual fund that
seeks capital appreciation by investing primarily in common stocks. The Fund
seeks investments in companies that its portfolio manager believes have been
overlooked or undervalued by other investors. Although the Fund emphasizes these
types of companies, it may invest in other companies that the portfolio manager
believes have the potential for significant capital appreciation.
The Fund is a separate series of Janus Investment Fund, a Massachusetts
business trust (the "Trust"). Each series of the Trust represents shares of
beneficial interest in a separate portfolio of securities and other assets with
its own objective and policies. The Fund is managed by Janus Capital Corporation
("Janus Capital").
This Statement of Additional Information ("SAI") is not a Prospectus and
should be read in conjunction with the Fund's Prospectus dated November 29, 1996
as supplemented June 26, 1997, which is incorporated by reference into this SAI
and may be obtained from the Trust at the above phone number or address. This
SAI contains additional and more detailed information about the Fund's
operations and activities than the Prospectus.
[LOGO] JANUS
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JANUS SPECIAL SITUATIONS FUND
STATEMENT OF ADDITIONAL INFORMATION
TABLE OF CONTENTS
Page
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Investment Policies, Restrictions and Techniques ....................... 3
Investment Objective ................................................ 3
Portfolio Policies .................................................. 3
Investment Restrictions ............................................. 3
Types of Securities and Investment Techniques ....................... 4
Illiquid Investments .............................................. 4
Zero Coupon, Pay-In-Kind and Step Coupon Securities ............... 5
Pass-Through Securities ........................................... 5
Depositary Receipts ............................................... 6
Other Income-Producing Securities ................................. 6
High-Yield/High-Risk Securities ................................... 7
Repurchase and Reverse Repurchase Agreements ...................... 7
Futures, Options and Other Derivative Instruments ................. 7
Investment Adviser ..................................................... 14
Custodian, Transfer Agent and Certain Affiliations ..................... 15
Portfolio Transactions and Brokerage ................................... 15
Officers and Trustees .................................................. 17
Purchase of Shares ..................................................... 18
Net Asset Value Determination ....................................... 18
Reinvestment of Dividends and Distributions ......................... 19
Redemption of Shares ................................................... 19
Shareholder Accounts ................................................ 19
Telephone Transactions .............................................. 20
Systematic Redemptions .............................................. 20
Retirement Plans ....................................................... 20
Income Dividends, Capital Gains Distributions and Tax Status ........... 20
Principal Shareholders ................................................. 21
Miscellaneous Information .............................................. 21
Shares of the Trust ................................................. 21
Voting Rights ....................................................... 21
Independent Accountants ............................................. 21
Registration Statement .............................................. 22
Performance Information ................................................ 22
Financial Statements ................................................... 22
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INVESTMENT POLICIES, RESTRICTIONS AND TECHNIQUES
INVESTMENT OBJECTIVE
As stated in the Prospectus, the Fund's investment objective is capital
appreciation. There can be no assurance that the Fund will, in fact, achieve its
objective. The investment objective of the Fund is not fundamental and may be
changed by the Trustees without shareholder approval.
PORTFOLIO POLICIES
The Prospectus discusses the types of securities in which the Fund will
invest, portfolio policies of the Fund and the investment techniques of the
Fund. The Prospectus includes a discussion of portfolio turnover policies.
The Fund's portfolio turnover rate (total long-term purchases or sales,
whichever is less, divided by the average monthly value of a fund's long-term
portfolio securities) for the fiscal period ended April 30, 1997 was 140%.
INVESTMENT RESTRICTIONS
As indicated in the Prospectus, the Fund is subject to certain fundamental
policies and restrictions that may not be changed without shareholder approval.
Shareholder approval means approval by the lesser of (i) more than 50% of the
outstanding voting securities of the Trust (or the Fund if a matter affects just
the Fund), or (ii) 67% or more of the voting securities present at a meeting if
the holders of more than 50% of the outstanding voting securities of the Trust
(or the Fund) are present or represented by proxy. As fundamental policies, the
Fund may not:
(1) Own more than 10% of the outstanding voting securities of any one
issuer and, as to fifty percent (50%) of the value of its total assets, purchase
the securities of any one issuer (except cash items and "government securities"
as defined under the Investment Company Act of 1940, as amended (the "1940
Act")), if immediately after and as a result of such purchase, the value of the
holdings of the Fund in the securities of such issuer exceeds 5% of the value of
the Fund's total assets.
(2) Invest 25% or more of the value of its total assets in any particular
industry (other than U.S. government securities).
(3) Invest directly in real estate or interests in real estate; however,
the Fund may own debt or equity securities issued by companies engaged in those
businesses.
(4) Purchase or sell physical commodities other than foreign currencies
unless acquired as a result of ownership of securities (but this limitation
shall not prevent the Fund from purchasing or selling options, futures, swaps
and forward contracts or from investing in securities or other instruments
backed by physical commodities).
(5) Lend any security or make any other loan if, as a result, more than 25%
of its total assets would be lent to other parties (but this limitation does not
apply to purchases of commercial paper, debt securities or repurchase
agreements).
(6) Act as an underwriter of securities issued by others, except to the
extent that the Fund may be deemed an underwriter in connection with the
disposition of portfolio securities of the Fund.
As a fundamental policy, the Fund may, notwithstanding any other investment
policy or limitation (whether or not fundamental), invest all of its assets in
the securities of a single open-end management investment company with
substantially the same fundamental investment objective, policies and
limitations as the Fund.
The Trustees have adopted additional investment restrictions for the Fund.
These restrictions are operating policies of the Fund and may be changed by the
Trustees without shareholder approval. The additional investment restrictions
adopted by the Trustees to date include the following:
(a) The Fund's investments in warrants, valued at the lower of cost or
market, may not exceed 5% of the value of its net assets. Included within that
amount, but not to exceed 2% of the value of the Fund's net assets, may be
warrants that are not listed on the New York or American Stock Exchange.
Warrants acquired by the Fund in units or attached to securities shall be deemed
to be without value for the purpose of monitoring this policy.
(b) The Fund will not (i) enter into any futures contracts and related
options for purposes other than bona fide hedging transactions within the
meaning of Commodity Futures Trading Commission ("CFTC") regulations if the
aggregate initial margin and premiums required to establish positions in futures
contracts and related options that do not fall within the definition of bona
fide hedging transactions will exceed 5% of the fair market value of the Fund's
net assets, after taking into account unrealized profits and unrealized losses
on any such contracts it has entered into; and (ii) enter into any futures
contracts if the aggregate amount of the Fund's commitments under outstanding
futures contracts positions would exceed the market value of its total assets.
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(c) The Fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to the
securities sold short without the payment of any additional consideration
therefor, and provided that transactions in futures, options, swaps and forward
contracts are not deemed to constitute selling securities short.
(d) The Fund does not currently intend to purchase securities on margin,
except that the Fund may obtain such short-term credits as are necessary for the
clearance of transactions, and provided that margin payments and other deposits
in connection with transactions in futures, options, swaps and forward contracts
shall not be deemed to constitute purchasing securities on margin.
(e) The Fund does not currently intend to (i) purchase securities of other
investment companies, except in the open market where no commission except the
ordinary broker's commission is paid, or (ii) purchase or retain securities
issued by other open-end investment companies. Limitations (i) and (ii) do not
apply to money market funds or to securities received as dividends, through
offers of exchange, or as a result of a reorganization, consolidation, or
merger. If the Fund invests in a money market fund, Janus Capital will reduce
its advisory fee by the amount of any investment advisory and administrative
services fees paid to the investment manager of the money market fund.
(f) The Fund may not mortgage or pledge any securities owned or held by the
Fund in amounts that exceed, in the aggregate, 15% of the Fund's net assets,
provided that this limitation does not apply to reverse repurchase agreements,
deposits of assets to margin, guarantee positions in futures, options, swaps or
forward contracts, or the segregation of assets in connection with such
contracts.
(g) The Fund does not intend to purchase securities of any issuer (other
than U.S. government agencies and instrumentalities or instruments guaranteed by
an entity with a record of more than three years' continuous operation,
including that of predecessors) with a record of less than three years'
continuous operation (including that of predecessors) if such purchase would
cause the cost of the Fund's investments in all such issuers to exceed 5% of the
Fund's total assets taken at market value at the time of such purchase.
(h) The Fund does not currently intend to invest directly in oil, gas, or
other mineral development or exploration programs or leases; however, the Fund
may own debt or equity securities of companies engaged in those businesses.
(i) The Fund may borrow money for temporary or emergency purposes (not for
leveraging or investment) in an amount not exceeding 25% of the value of its
total assets (including the amount borrowed) less liabilities (other than
borrowings). If borrowings exceed 25% of the value of the Fund's total assets by
reason of a decline in net assets, the Fund will reduce its borrowings within
three business days to the extent necessary to comply with the 25% limitation.
This policy shall not prohibit reverse repurchase agreements, deposits of assets
to margin or guarantee positions in futures, options, swaps or forward
contracts, or the segregation of assets in connection with such contracts.
(j) The Fund does not currently intend to purchase any security or enter
into a repurchase agreement if, as a result, more than 15% of its net assets
would be invested in repurchase agreements not entitling the holder to payment
of principal and interest within seven days and in securities that are illiquid
by virtue of legal or contractual restrictions on resale or the absence of a
readily available market. The Trustees, or the Fund's investment adviser acting
pursuant to authority delegated by the Trustees, may determine that a readily
available market exists for securities eligible for resale pursuant to Rule 144A
under the Securities Act of 1933 ("Rule 144A Securities"), or any successor to
such rule, Section 4(2) commercial paper and municipal lease obligations.
Accordingly, such securities may not be subject to the foregoing limitation.
(k) The Fund may not invest in companies for the purpose of exercising
control of management.
For purposes of the Fund's restriction on investing in a particular
industry, the Fund will rely primarily on industry classifications as published
by Bloomberg L.P. To the extent that Bloomberg L.P. classifications are so broad
that the primary economic characteristics in a single class are materially
different, the Fund may further classify issuers in accordance with industry
classifications as published by the Securities and Exchange Commission ("SEC").
TYPES OF SECURITIES AND INVESTMENT TECHNIQUES
ILLIQUID INVESTMENTS
The Fund may invest up to 15% of its net assets in illiquid investments
(i.e., securities that are not readily marketable). The Trustees of the Fund
have authorized Janus Capital to make liquidity determinations with respect to
its securities, including Rule 144A securities, commercial paper and municipal
lease obligations. Under the guidelines established by the Trustees, Janus
Capital will consider the following factors: 1) the frequency of trades and
quoted prices for the obligation; 2) the number of dealers willing to purchase
or sell the security and the number of other potential purchasers; 3) the
willingness of dealers to undertake to make a market in the security; and 4) the
nature of the security and the nature of marketplace trades, including the time
needed to dispose of the security, the method of soliciting offers and the
mechanics of the transfer. In the case of commercial
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paper, Janus Capital will also consider whether the paper is traded flat or in
default as to principal and interest and any ratings of the paper by a
Nationally Recognized Statistical Rating Organization ("NRSRO"). A foreign
security that may be freely traded on or through the facilities of an offshore
exchange or other securities market is not deemed to be a restricted security
subject to these procedures.
ZERO COUPON, PAY-IN-KIND AND STEP COUPON SECURITIES
The Fund may invest up to 10% of its assets in zero coupon, pay-in-kind and
step coupon securities. Zero coupon bonds are issued and traded at a discount
from their face value. They do not entitle the holder to any periodic payment of
interest prior to maturity. Step coupon bonds trade at a discount from their
face value and pay coupon interest. The coupon rate is low for an initial period
and then increases to a higher coupon rate thereafter. The discount from the
face amount or par value depends on the time remaining until cash payments
begin, prevailing interest rates, liquidity of the security and the perceived
credit quality of the issuer. Pay-in-kind bonds normally give the issuer an
option to pay cash at a coupon payment date or give the holder of the security a
similar bond with the same coupon rate and a face value equal to the amount of
the coupon payment that would have been made.
Current federal income tax law requires holders of zero coupon securities
and step coupon securities to report the portion of the original issue discount
on such securities that accrues during a given year as interest income, even
though the holders receive no cash payments of interest during the year. In
order to qualify as a "regulated investment company" under the Internal Revenue
Code of 1986 and the regulations thereunder (the "Code"), the Fund must
distribute its investment company taxable income, including the original issue
discount accrued on zero coupon or step coupon bonds. Because the Fund will not
receive cash payments on a current basis in respect of accrued original-issue
discount on zero coupon bonds or step coupon bonds during the period before
interest payments begin, in some years the Fund may have to distribute cash
obtained from other sources in order to satisfy the distribution requirements
under the Code. The Fund might obtain such cash from selling other portfolio
holdings which might cause the Fund to incur capital gains or losses on the
sale. Additionally, these actions are likely to reduce the assets to which Fund
expenses could be allocated and to reduce the rate of return for the Fund. In
some circumstances, such sales might be necessary in order to satisfy cash
distribution requirements even though investment considerations might otherwise
make it undesirable for the Fund to sell the securities at the time.
Generally, the market prices of zero coupon, step coupon and pay-in-kind
securities are more volatile than the prices of securities that pay interest
periodically and in cash and are likely to respond to changes in interest rates
to a greater degree than other types of debt securities having similar
maturities and credit quality.
PASS-THROUGH SECURITIES
The Fund may invest in various types of pass-through securities, such as
mortgage-backed securities, asset-backed securities and participation interests.
A pass-through security is a share or certificate of interest in a pool of debt
obligations that have been repackaged by an intermediary, such as a bank or
broker-dealer. The purchaser of a pass-through security receives an undivided
interest in the underlying pool of securities. The issuers of the underlying
securities make interest and principal payments to the intermediary which are
passed through to purchasers, such as the Fund. The most common type of
pass-through securities are mortgage-backed securities. Government National
Mortgage Association ("GNMA") Certificates are mortgage-backed securities that
evidence an undivided interest in a pool of mortgage loans. GNMA Certificates
differ from bonds in that principal is paid back monthly by the borrowers over
the term of the loan rather than returned in a lump sum at maturity. The Fund
will generally purchase "modified pass-through" GNMA Certificates, which entitle
the holder to receive a share of all interest and principal payments paid and
owned on the mortgage pool, net of fees paid to the "issuer" and GNMA,
regardless of whether or not the mortgagor actually makes the payment. GNMA
Certificates are backed as to the timely payment of principal and interest by
the full faith and credit of the U.S. government.
The Federal Home Loan Mortgage Corporation ("FHLMC") issues two types of
mortgage pass-through securities: mortgage participation certificates ("PCs")
and guaranteed mortgage certificates ("GMCs"). PCs resemble GNMA Certificates in
that each PC represents a pro rata share of all interest and principal payments
made and owned on the underlying pool. FHLMC guarantees timely payments of
interest on PCs and the full return of principal. GMCs also represent a pro rata
interest in a pool of mortgages. However, these instruments pay interest
semiannually and return principal once a year in guaranteed minimum payments.
This type of security is guaranteed by FHLMC as to timely payment of principal
and interest but it is not guaranteed by the full faith and credit of the U.S.
government.
The Federal National Mortgage Association ("FNMA") issues guaranteed
mortgage pass-through certificates ("FNMA Certificates"). FNMA Certificates
resemble GNMA Certificates in that each FNMA Certificate represents a pro rata
share of all interest and principal payments made and owned on the underlying
pool. This type of security is guaranteed by FNMA as to timely payment of
principal and interest but it is not guaranteed by the full faith and credit of
the U.S. government.
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Except for GMCs, each of the mortgage-backed securities described above is
characterized by monthly payments to the holder, reflecting the monthly payments
made by the borrowers who received the underlying mortgage loans. The payments
to the security holders (such as the Fund), like the payments on the underlying
loans, represent both principal and interest. Although the underlying mortgage
loans are for specified periods of time, such as 20 or 30 years, the borrowers
can, and typically do, pay them off sooner. Thus, the security holders
frequently receive prepayments of principal in addition to the principal that is
part of the regular monthly payments. The Fund's portfolio managers will
consider estimated prepayment rates in calculating the average weighted maturity
of the Fund. A borrower is more likely to prepay a mortgage that bears a
relatively high rate of interest. This means that in times of declining interest
rates, higher yielding mortgage-backed securities held by the Fund might be
converted to cash and the Fund will be forced to accept lower interest rates
when that cash is used to purchase additional securities in the mortgage-backed
securities sector or in other investment sectors. Additionally, prepayments
during such periods will limit the Fund's ability to participate in as large a
market gain as may be experienced with a comparable security not subject to
prepayment.
Asset-backed securities represent interests in pools of consumer loans and
are backed by paper or accounts receivables originated by banks, credit card
companies or other providers of credit. Generally, the originating bank or
credit provider is neither the obligor or guarantor of the security and interest
and principal payments ultimately depend upon payment of the underlying loans by
individuals. Tax-exempt asset-backed securities include units of beneficial
interests in pools of purchase contracts, financing leases, and sales agreements
that may be created when a municipality enters into an installment purchase
contract or lease with a vendor. Such securities may be secured by the assets
purchased or leased by the municipality; however, if the municipality stops
making payments, there generally will be no recourse against the vendor. The
market for tax-exempt asset-backed securities is still relatively new. These
obligations are likely to involve unscheduled prepayments of principal.
DEPOSITARY RECEIPTS
The Fund may invest in sponsored and unsponsored American Depositary
Receipts ("ADRs"), which are receipts issued by an American bank or trust
company evidencing ownership of underlying securities issued by a foreign
issuer. ADRs, in registered form, are designed for use in U.S. securities
markets. Unsponsored ADRs may be created without the participation of the
foreign issuer. Holders of these ADRs generally bear all the costs of the ADR
facility, whereas foreign issuers typically bear certain costs in a sponsored
ADR. The bank or trust company depositary of an unsponsored ADR may be under no
obligation to distribute shareholder communications received from the foreign
issuer or to pass through voting rights. The Fund may also invest in European
Depositary Receipts ("EDRs"), Global Depositary Receipts ("GDRs") and in other
similar instruments representing securities of foreign companies. EDRs are
receipts issued by a European financial institution evidencing an arrangement
similar to that of ADRs. EDRs, in bearer form, are designed for use in European
securities markets.
OTHER INCOME-PRODUCING SECURITIES
Other types of income producing securities that the Fund may purchase
include, but are not limited to, the following types of securities:
Variable and floating rate obligations. These types of securities have
variable or floating rates of interest and, under certain limited circumstances,
may have varying principal amounts. Variable and floating rate securities pay
interest at rates that are adjusted periodically according to a specified
formula, usually with reference to some interest rate index or market interest
rate (the "underlying index"). See also "Inverse Floaters."
Standby commitments. These instruments, which are similar to a put, give
the Fund the option to obligate a broker, dealer or bank to repurchase a
security held by the Fund at a specified price.
Tender option bonds. Tender option bonds are generally long-term securities
that are coupled with the option to tender the securities to a bank,
broker-dealer or other financial institution at periodic intervals and receive
the face value of the bond. This type of security is commonly used as a means of
enhancing the security's liquidity.
Inverse floaters. Inverse floaters are debt instruments whose interest
bears an inverse relationship to the interest rate on another security. Certain
inverse floaters may have an interest rate reset mechanism that multiplies the
effects of change in the underlying index. Such mechanism may increase the
volatility of the security's market value. Certain variable rate securities
(including certain mortgage-backed securities) pay interest at a rate that
varies inversely to prevailing short-term interest rates (sometimes referred to
as inverse floaters). For example, upon reset the interest rate payable on a
security may go down when the underlying index has risen. The Fund will not
invest more than 5% of its assets in inverse floaters.
The Fund will purchase standby commitments, tender option bonds and
instruments with demand features primarily for the purpose of increasing the
liquidity of its portfolio.
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HIGH-YIELD/HIGH-RISK SECURITIES
The Fund intends to invest less than 35% of its net assets in debt
securities that are rated below investment grade (e.g., securities rated BB or
lower by Standard & Poor's Ratings Services ("Standard & Poor's") or Ba or lower
by Moody's Investors Service, Inc. ("Moody's")). Lower rated bonds involve a
higher degree of credit risk, which is the risk that the issuer will not make
interest or principal payments when due. In the event of an unanticipated
default, the Fund would experience a reduction in its income, and could expect a
decline in the market value of the securities so affected.
The Fund may also invest in unrated debt securities of foreign and domestic
issuers. Unrated debt, while not necessarily of lower quality than rated
securities, may not have as broad a market. Sovereign debt of foreign
governments is generally rated by country. Because these ratings do not take
into account individual factors relevant to each issue and may not be updated
regularly, Janus Capital may treat such securities as unrated debt. Because of
the size and perceived demand of the issue, among other factors, certain
municipalities may not incur the costs of obtaining a rating. The Fund's
portfolio manager will analyze the credit worthiness of the issuer, as well as
any financial institution or other party responsible for payments on the
security, in determining whether to purchase unrated municipal bonds. Unrated
debt securities will be included in the 35% limit unless the portfolio managers
deem such securities to be the equivalent of investment grade securities.
REPURCHASE AND REVERSE REPURCHASE AGREEMENTS
In a repurchase agreement, the Fund purchases a security and simultaneously
commits to resell that security to the seller at an agreed upon price on an
agreed upon date within a number of days (usually not more than seven) from the
date of purchase. The resale price reflects the purchase price plus an agreed
upon incremental amount that is unrelated to the coupon rate or maturity of the
purchased security. A repurchase agreement involves the obligation of the seller
to pay the agreed upon price, which obligation is in effect secured by the value
(at least equal to the amount of the agreed upon resale price and
marked-to-market daily) of the underlying security or "collateral." The Fund may
engage in a repurchase agreement with respect to any security in which it is
authorized to invest. A risk associated with repurchase agreements is the
failure of the seller to repurchase the securities as agreed, which may cause
the Fund to suffer a loss if the market value of such securities declines before
they can be liquidated on the open market. In the event of bankruptcy or
insolvency of the seller, the Fund may encounter delays and incur costs in
liquidating the underlying security. Repurchase agreements that mature in more
than seven days will be subject to the 15% limit on illiquid investments. While
it is possible to eliminate all risks from these transactions, it is the policy
of the Fund to limit repurchase agreements to those parties whose
creditworthiness has been reviewed and found satisfactory by Janus Capital.
The Fund may use reverse repurchase agreements to provide cash to satisfy
unusually heavy redemption requests or for other temporary or emergency purposes
without the necessity of selling portfolio securities. In a reverse repurchase
agreement, the Fund sells a portfolio security to another party, such as a bank
or broker-dealer, in return for cash and agrees to repurchase the instrument at
a particular price and time. While a reverse repurchase agreement is
outstanding, the Fund will maintain cash and appropriate liquid assets in a
segregated custodial account to cover its obligation under the agreement. The
Fund will enter into reverse repurchase agreements only with parties that Janus
Capital deems creditworthy. Using reverse repurchase agreements to earn
additional income involves the risk that the interest earned on the invested
proceeds is less than the expense of the reverse repurchase agreement
transaction. This technique may also have a leveraging effect on the Fund's
portfolio, although the Fund's intent to segregate assets in the amount of the
reverse repurchase agreement minimizes this effect.
FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS
Futures Contracts. The Fund may enter into contracts for the purchase or
sale for future delivery of fixed-income securities, foreign currencies or
contracts based on financial indices, including indices of U.S. government
securities, foreign government securities, equity or fixed-income securities.
U.S. futures contracts are traded on exchanges which have been designated
"contract markets" by the CFTC and must be executed through a futures commission
merchant ("FCM"), or brokerage firm, which is a member of the relevant contract
market. Through their clearing corporations, the exchanges guarantee performance
of the contracts as between the clearing members of the exchange.
The buyer or seller of a futures contract is not required to deliver or pay
for the underlying instrument unless the contract is held until the delivery
date. However, both the buyer and seller are required to deposit "initial
margin" for the benefit of the FCM when the contract is entered into. Initial
margin deposits are equal to a percentage of the contract's value, as set by the
exchange on which the contract is traded, and may be maintained in cash or
certain other liquid assets by the Fund's custodian for the benefit of the FCM.
Initial margin payments are similar to good faith deposits or performance bonds.
Unlike margin extended by a securities broker, initial margin payments do not
constitute purchasing securities on margin for purposes of the Fund's investment
limitations. If the value of either party's position declines, that party will
be required to make additional "variation margin" payments for the benefit of
the FCM to settle the change in value on a daily basis. The party that has a
gain may be entitled to receive all or a portion of this amount. In the event of
the bankruptcy of the FCM that holds margin on behalf of the Fund, the Fund may
be entitled to a return of margin owed to the Fund only in proportion to the
amount received by the
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FCM's other customers. Janus Capital will attempt to minimize the risk by
careful monitoring of the creditworthiness of the FCMs with which the Fund does
business and by depositing margin payments in a segregated account with the
Fund's custodian.
The Fund intends to comply with guidelines of eligibility for exclusion
from the definition of the term "commodity pool operator" adopted by the CFTC
and the National Futures Association, which regulate trading in the futures
markets. The Fund will use futures contracts and related options primarily for
bona fide hedging purposes within the meaning of CFTC regulations. To the extent
that the Fund holds positions in futures contracts and related options that do
not fall within the definition of bona fide hedging transactions, the aggregate
initial margin and premiums required to establish such positions will not exceed
5% of the fair market value of the Fund's net assets, after taking into account
unrealized profits and unrealized losses on any such contracts it has entered
into.
Although the Fund will segregate cash and liquid assets in an amount
sufficient to cover its open futures obligations, the segregated assets would be
available to the Fund immediately upon closing out the futures position, while
settlement of securities transactions could take several days. However, because
the Fund's cash that may otherwise be invested would be held uninvested or
invested in other liquid assets so long as the futures position remains open,
the Fund's return could be diminished due to the opportunity losses of foregoing
other potential investments.
The Fund's primary purpose in entering into futures contracts is to protect
the Fund from fluctuations in the value of securities or interest rates without
actually buying or selling the underlying debt or equity security. For example,
if the Fund anticipates an increase in the price of stocks, and it intends to
purchase stocks at a later time, the Fund could enter into a futures contract to
purchase a stock index as a temporary substitute for stock purchases. If an
increase in the market occurs that influences the stock index as anticipated,
the value of the futures contracts will increase, thereby serving as a hedge
against the Fund not participating in a market advance. This technique is
sometimes known as an anticipatory hedge. To the extent the Fund enters into
futures contracts for this purpose, the segregated assets maintained to cover
the Fund's obligations with respect to the futures contracts will consist of
other liquid assets from its portfolio in an amount equal to the difference
between the contract price and the aggregate value of the initial and variation
margin payments made by the Fund with respect to the futures contracts.
Conversely, if the Fund holds stocks and seeks to protect itself from a decrease
in stock prices, the Fund might sell stock index futures contracts, thereby
hoping to offset the potential decline in the value of its portfolio securities
by a corresponding increase in the value of the futures contract position The
Fund could protect against a decline in stock prices by selling portfolio
securities and investing in money market instruments, but the use of futures
contracts enables it to maintain a defensive position without having to sell
portfolio securities.
If the Fund owns Treasury bonds and the portfolio managers expect interest
rates to increase, the Fund may take a short position in interest rate futures
contracts. Taking such a position would have much the same effect as the Fund
selling Treasury bonds in its portfolio. If interest rates increase as
anticipated, the value of the Treasury bonds would decline, but the value of the
Fund's interest rate futures contract will increase, thereby keeping the net
asset value of the Fund from declining as much as it may have otherwise. If, on
the other hand, the portfolio managers expect interest rates to decline, the
Fund may take a long position in interest rate futures contracts in anticipation
of later closing out the futures position and purchasing bonds. Although the
Fund can accomplish similar results by buying securities with long maturities
and selling securities with short maturities, given the greater liquidity of the
futures market than the cash market, it may be possible to accomplish the same
result more easily and more quickly by using futures contracts as an investment
tool to reduce risk.
The ordinary spreads between prices in the cash and futures markets, due to
differences in the nature of those markets, are subject to distortions. First,
all participants in the futures market are subject to initial margin and
variation margin requirements. Rather than meeting additional variation margin
requirements, investors may close out futures contracts through offsetting
transactions which could distort the normal price relationship between the cash
and futures markets. Second, the liquidity of the futures market depends on
participants entering into offsetting transactions rather than making or taking
delivery of the instrument underlying a futures contract. To the extent
participants decide to make or take delivery, liquidity in the futures market
could be reduced and prices in the futures market distorted. Third, from the
point of view of speculators, the margin deposit requirements in the futures
market are less onerous than margin requirements in the securities market.
Therefore, increased participation by speculators in the futures market may
cause temporary price distortions. Due to the possibility of the foregoing
distortions, a correct forecast of general price trends by the portfolio
managers still may not result in a successful use of futures.
Futures Contracts Entail Risks. Although the Fund believes that use of such
contracts will benefit the Fund, the Fund's overall performance could be worse
than if the Fund had not entered into futures contracts if the portfolio
managers' investment judgement proves incorrect. For example, if the Fund has
hedged against the effects of a possible decrease in prices of securities held
in its portfolio and prices increase instead, the Fund will lose part or all of
the benefit of the increased value of these securities because of offsetting
losses in its futures positions. In addition, if the Fund has insufficient cash,
it may have to sell securities from its portfolio to meet daily variation margin
requirements. Those sales may be, but will not necessarily be, at increased
prices which reflect the rising market and may occur at a time when the sales
are disadvantageous to the Fund.
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The prices of futures contracts depend primarily on the value of their
underlying instruments. Because there are a limited number of types of futures
contracts, it is possible that the standardized futures contracts available to
the Fund will not match exactly the Fund's current or potential investments. The
Fund may buy and sell futures contracts based on underlying instruments with
different characteristics from the securities in which it typically invests -
for example, by hedging investments in portfolio securities with a futures
contract based on a broad index of securities which involves a risk that the
futures position will not correlate precisely with the performance of the Fund's
investments.
Futures prices can also diverge from the prices of their underlying
instruments, even if the underlying instruments closely correlate with the
Fund's investments. Futures prices are affected by factors such as current and
anticipated short-term interest rates, changes in volatility of the underlying
instruments and the time remaining until expiration of the contract. Those
factors may affect securities prices differently from futures prices. Imperfect
correlations between the Fund's investments and its futures positions also may
result from differing levels of demand in the futures markets and the securities
markets, from structural differences in how futures and securities are traded,
and from imposition of daily price fluctuation limits for futures contracts. The
Fund may buy or sell futures contracts with a greater or lesser value than the
securities it wishes to hedge or is considering purchasing in order to attempt
to compensate for differences in historical volatility between the futures
contract and the securities, although this may not be successful in all cases.
If price changes in the Fund's futures positions are poorly correlated with its
other investments, its futures positions may fail to produce desired gains or
result in losses that are not offset by the gains in the Fund's other
investments.
Because futures contracts are generally settled within a day from the date
they are closed out, compared with a settlement period of three days for some
types of securities, the futures markets can provide superior liquidity to the
securities markets. Nevertheless, there is no assurance that a liquid secondary
market will exist for any particular futures contract at any particular time. In
addition, futures exchanges may establish daily price fluctuation limits for
futures contracts and may halt trading if a contract's price moves upward or
downward more than the limit in a given day. On volatile trading days when the
price fluctuation limit is reached, it may be impossible for the Fund to enter
into new positions or close out existing positions. If the secondary market for
a futures contract is not liquid because of price fluctuation limits or
otherwise, the Fund may not be able to promptly liquidate unfavorable futures
positions and potentially could be required to continue to hold a futures
position until the delivery date, regardless of changes in its value. As a
result, the Fund's access to other assets held to cover its futures positions
also could be impaired.
Options on Futures Contracts. The Fund may buy and write put and call
options on futures contracts. An option on a future gives the Fund the right
(but not the obligation) to buy or sell a futures contract at a specified price
on or before a specified date. The purchase of a call option on a futures
contract is similar in some respects to the purchase of a call option on an
individual security. Depending on the pricing of the option compared to either
the price of the futures contract upon which it is based or the price of the
underlying instrument, ownership of the option may or may not be less risky than
ownership of the futures contract or the underlying instrument. As with the
purchase of futures contracts, when the Fund is not fully invested it may buy a
call option on a futures contract to hedge against a market advance.
The writing of a call option on a futures contract constitutes a partial
hedge against declining prices of the security or foreign currency which is
deliverable under, or of the index comprising, the futures contract. If the
future's price at the expiration of the option is below the exercise price, the
Fund will retain the full amount of the option premium which provides a partial
hedge against any decline that may have occurred in the Fund's portfolio
holdings. The writing of a put option on a futures contract constitutes a
partial hedge against increasing prices of the security or foreign currency
which is deliverable under, or of the index comprising, the futures contract. If
the futures' price at expiration of the option is higher than the exercise
price, the Fund will retain the full amount of the option premium which provides
a partial hedge against any increase in the price of securities which the Fund
is considering buying. If a call or put option the Fund has written is
exercised, the Fund will incur a loss which will be reduced by the amount of the
premium it received. Depending on the degree of correlation between the change
in the value of its portfolio securities and changes in the value of the futures
positions, the Fund's losses from existing options on futures may to some extent
be reduced or increased by changes in the value of portfolio securities.
The purchase of a put option on a futures contract is similar in some
respects to the purchase of protective put options on portfolio securities. For
example, the Fund may buy a put option on a futures contract to hedge its
portfolio against the risk of falling prices or rising interest rates.
The amount of risk the Fund assumes when it buys an option on a futures
contract is the premium paid for the option plus related transaction costs. In
addition to the correlation risks discussed above, the purchase of an option
also entails the risk that changes in the value of the underlying futures
contract will not be fully reflected in the value of the options bought.
Forward Contracts. A forward contract is an agreement between two parties
in which one party is obligated to deliver a stated amount of a stated asset at
a specified time in the future and the other party is obligated to pay a
specified amount for the assets at the time of delivery. The Fund may enter into
forward contracts to purchase and sell government securities, equity or income
securities, foreign currencies or other financial instruments. Forward contracts
generally are traded in an interbank
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market conducted directly between traders (usually large commercial banks) and
their customers. Unlike futures contracts, which are standardized contracts,
forward contracts can be specifically drawn to meet the needs of the parties
that enter into them. The parties to a forward contract may agree to offset or
terminate the contract before its maturity, or may hold the contract to maturity
and complete the contemplated exchange.
The following discussion summarizes the Fund's principal uses of forward
foreign currency exchange contracts ("forward currency contracts"). The Fund may
enter into forward currency contracts with stated contract values of up to the
value of the Fund's assets. A forward currency contract is an obligation to buy
or sell an amount of a specified currency for an agreed price (which may be in
U.S. dollars or a foreign currency). The Fund will exchange foreign currencies
for U.S. dollars and for other foreign currencies in the normal course of
business and may buy and sell currencies through forward currency contracts in
order to fix a price for securities it has agreed to buy or sell ("transaction
hedge"). The Fund also may hedge some or all of its investments denominated in a
foreign currency or exposed to foreign currency fluctuations against a decline
in the value of that currency relative to the U.S. dollar by entering into
forward currency contracts to sell an amount of that currency (or a proxy
currency whose performance is expected to replicate or exceed the performance of
that currency relative to the U.S. dollar) approximating the value of some or
all of its portfolio securities denominated in that currency ("position hedge")
or by participating in options or futures contracts with respect to the
currency. The Fund also may enter into a forward currency contract with respect
to a currency where the Fund is considering the purchase or sale of investments
denominated in that currency but has not yet selected the specific investments
("anticipatory hedge"). In any of these circumstances the Fund may,
alternatively, enter into a forward currency contract to purchase or sell one
foreign currency for a second currency that is expected to perform more
favorably relative to the U.S. dollar if the portfolio managers believe there is
a reasonable degree of correlation between movements in the two currencies
("cross-hedge").
These types of hedging minimize the effect of currency appreciation as well
as depreciation, but do not eliminate fluctuations in the underlying U.S. dollar
equivalent value of the proceeds of or rates of return on the Fund's foreign
currency denominated portfolio securities. The matching of the increase in value
of a forward contract and the decline in the U.S. dollar equivalent value of the
foreign currency denominated asset that is the subject of the hedge generally
will not be precise. Shifting the Fund's currency exposure from one foreign
currency to another removes the Fund's opportunity to profit from increases in
the value of the original currency and involves a risk of increased losses to
the Fund if its portfolio managers' projection of future exchange rates is
inaccurate. Proxy hedges and cross-hedges may result in losses if the currency
used to hedge does not perform similarly to the currency in which hedged
securities are denominated. Unforeseen changes in currency prices may result in
poorer overall performance for the Fund than if it had not entered into such
contracts.
The Fund will cover outstanding forward currency contracts by maintaining
liquid portfolio securities denominated in or whose value is tied to, the
currency underlying the forward contract or the currency being hedged. To the
extent that the Fund is not able to cover its forward currency positions with
underlying portfolio securities, the Fund's custodian will segregate cash or
other liquid assets having a value equal to the aggregate amount of the Fund's
commitments under forward contracts entered into with respect to position
hedges, cross-hedges and anticipatory hedges. If the value of the securities
used to cover a position or the value of segregated assets declines, the Fund
will find alternative cover or segregate additional cash or liquid assets on a
daily basis so that the value of the covered and segregated assets will be equal
to the amount of the Fund's commitments with respect to such contracts. As an
alternative to segregating assets, the Fund may buy call options permitting the
Fund to buy the amount of foreign currency being hedged by a forward sale
contract or the Fund may buy put options permitting it to sell the amount of
foreign currency subject to a forward buy contract.
While forward contracts are not currently regulated by the CFTC, the CFTC
may in the future assert authority to regulate forward contacts. In such event,
the Fund's ability to utilize forward contracts may be restricted. In addition,
the Fund may not always be able to enter into forward contracts at attractive
prices and may be limited in its ability to use these contracts to hedge Fund
assets.
Options on Foreign Currencies. The Fund may buy and write options on
foreign currencies in a manner similar to that in which futures or forward
contracts on foreign currencies will be utilized. For example, a decline in the
U.S. dollar value of a foreign currency in which portfolio securities are
denominated will reduce the U.S. dollar value of such securities, even if their
value in the foreign currency remains constant. In order to protect against such
diminutions in the value of portfolio securities, the Fund may buy put options
on the foreign currency. If the value of the currency declines, the Fund will
have the right to sell such currency for a fixed amount in U.S. dollars, thereby
offsetting, in whole or in part, the adverse effect on its portfolio.
Conversely, when a rise in the U.S. dollar value of a currency in which
securities to be acquired are denominated is projected, thereby increasing the
cost of such securities, the Fund may buy call options on the foreign currency.
The purchase of such options could offset, at least partially, the effects of
the adverse movements in exchange rates. As in the case of other types of
options, however, the benefit to the Fund from purchases of foreign currency
options will be reduced by the amount of the premium and related transaction
costs. In addition, if currency exchange rates do not move in the direction or
to the extent desired, the Fund could sustain losses on transactions in foreign
currency options that would require the Fund to forego a portion or all of the
benefits of advantageous changes in those rates.
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The Fund may also write options on foreign currencies. For example, to
hedge against a potential decline in the U.S. dollar value of foreign currency
denominated securities due to adverse fluctuations in exchange rates, the Fund
could, instead of purchasing a put option, write a call option on the relevant
currency. If the expected decline occurs, the option will most likely not be
exercised and the decline in value of portfolio securities will be offset by the
amount of the premium received.
Similarly, instead of purchasing a call option to hedge against a potential
increase in the U.S. dollar cost of securities to be acquired, the Fund could
write a put option on the relevant currency which, if rates move in the manner
projected, will expire unexercised and allow the Fund to hedge the increased
cost up to the amount of the premium. As in the case of other types of options,
however, the writing of a foreign currency option will constitute only a partial
hedge up to the amount of the premium. If exchange rates do not move in the
expected direction, the option may be exercised and the Fund would be required
to buy or sell the underlying currency at a loss which may not be offset by the
amount of the premium. Through the writing of options on foreign currencies, the
Fund also may lose all or a portion of the benefits which might otherwise have
been obtained from favorable movements in exchange rates.
The Fund may write covered call options on foreign currencies. A call
option written on a foreign currency by the Fund is "covered" if the Fund owns
the foreign currency underlying the call or has an absolute and immediate right
to acquire that foreign currency without additional cash consideration (or for
additional cash consideration held in a segregated account by its custodian)
upon conversion or exchange of other foreign currencies held in its portfolio. A
call option is also covered if the Fund has a call on the same foreign currency
in the same principal amount as the call written if the exercise price of the
call held (i) is equal to or less than the exercise price of the call written or
(ii) is greater than the exercise price of the call written, if the difference
is maintained by the Fund in cash or other liquid assets in a segregated account
with the Fund's custodian.
The Fund also may write call options on foreign currencies for
cross-hedging purposes. A call option on a foreign currency is for cross-hedging
purposes if it is designed to provide a hedge against a decline due to an
adverse change in the exchange rate in the U.S. dollar value of a security which
the Fund owns or has the right to acquire and which is denominated in the
currency underlying the option. Call options on foreign currencies which are
entered into for cross-hedging purposes are not covered. However, in such
circumstances, the Fund will collateralize the option by segregating cash or
other liquid assets in an amount not less than the value of the underlying
foreign currency in U.S. dollars marked-to-market daily.
Options on Securities. In an effort to increase current income and to
reduce fluctuations in net asset value, the Fund may write covered put and call
options and buy put and call options on securities that are traded on United
States and foreign securities exchanges and over-the-counter. The Fund may write
and buy options on the same types of securities that the Fund may purchase
directly.
A put option written by the Fund is "covered" if the Fund (i) segregates
cash not available for investment or other liquid assets with a value equal to
the exercise price of the put with the Fund's custodian or (ii) holds a put on
the same security and in the same principal amount as the put written and the
exercise price of the put held is equal to or greater than the exercise price of
the put written. The premium paid by the buyer of an option will reflect, among
other things, the relationship of the exercise price to the market price and the
volatility of the underlying security, the remaining term of the option, supply
and demand and interest rates.
A call option written by the Fund is "covered" if the Fund owns the
underlying security covered by the call or has an absolute and immediate right
to acquire that security without additional cash consideration (or for
additional cash consideration held in a segregated account by the Fund's
custodian) upon conversion or exchange of other securities held in its
portfolio. A call option is also deemed to be covered if the Fund holds a call
on the same security and in the same principal amount as the call written and
the exercise price of the call held (i) is equal to or less than the exercise
price of the call written or (ii) is greater than the exercise price of the call
written if the difference is maintained by the Fund in cash and other liquid
assets in a segregated account with its custodian.
The Fund also may write call options that are not covered for cross-hedging
purposes. The Fund collateralizes its obligation under a written call option for
cross-hedging purposes by segregating cash or other liquid assets in an amount
not less than the market value of the underlying security, marked-to-market
daily. The Fund would write a call option for cross-hedging purposes, instead of
writing a covered call option, when the premium to be received from the
cross-hedge transaction would exceed that which would be received from writing a
covered call option and its portfolio managers believe that writing the option
would achieve the desired hedge.
The writer of an option may have no control over when the underlying
securities must be sold, in the case of a call option, or bought, in the case of
a put option, since with regard to certain options, the writer may be assigned
an exercise notice at any time prior to the termination of the obligation.
Whether or not an option expires unexercised, the writer retains the amount of
the premium. This amount, of course, may, in the case of a covered call option,
be offset by a decline in the market value of the underlying security during the
option period. If a call option is exercised, the writer experiences a profit or
loss from the sale of the underlying security. If a put option is exercised, the
writer must fulfill the obligation to buy the underlying security at the
exercise price, which will usually exceed the then market value of the
underlying security.
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The writer of an option that wishes to terminate its obligation may effect
a "closing purchase transaction." This is accomplished by buying an option of
the same series as the option previously written. The effect of the purchase is
that the writer's position will be canceled by the clearing corporation.
However, a writer may not effect a closing purchase transaction after being
notified of the exercise of an option. Likewise, an investor who is the holder
of an option may liquidate its position by effecting a "closing sale
transaction." This is accomplished by selling an option of the same series as
the option previously bought. There is no guarantee that either a closing
purchase or a closing sale transaction can be effected.
In the case of a written call option, effecting a closing transaction will
permit the Fund to write another call option on the underlying security with
either a different exercise price or expiration date or both. In the case of a
written put option, such transaction will permit the Fund to write another put
option to the extent that the exercise price is secured by other liquid assets.
Effecting a closing transaction also will permit the Fund to use the cash or
proceeds from the concurrent sale of any securities subject to the option for
other investments. If the Fund desires to sell a particular security from its
portfolio on which it has written a call option, the Fund will effect a closing
transaction prior to or concurrent with the sale of the security.
The Fund will realize a profit from a closing transaction if the price of
the purchase transaction is less than the premium received from writing the
option or the price received from a sale transaction is more than the premium
paid to buy the option. The Fund will realize a loss from a closing transaction
if the price of the purchase transaction is more than the premium received from
writing the option or the price received from a sale transaction is less than
the premium paid to buy the option. Because increases in the market of a call
option generally will reflect increases in the market price of the underlying
security, any loss resulting from the repurchase of a call option is likely to
be offset in whole or in part by appreciation of the underlying security owned
by the Fund.
An option position may be closed out only where a secondary market for an
option of the same series exists. If a secondary market does not exist, the Fund
may not be able to effect closing transactions in particular options and the
Fund would have to exercise the options in order to realize any profit. If the
Fund is unable to effect a closing purchase transaction in a secondary market,
it will not be able to sell the underlying security until the option expires or
it delivers the underlying security upon exercise. The absence of a liquid
secondary market may be due to the following: (i) insufficient trading interest
in certain options, (ii) restrictions imposed by a national securities exchange
("Exchange") on which the option is traded on opening or closing transactions or
both, (iii) trading halts, suspensions or other restrictions imposed with
respect to particular classes or series of options or underlying securities,
(iv) unusual or unforeseen circumstances that interrupt normal operations on an
Exchange, (v) the facilities of an Exchange or of the Options Clearing
Corporation ("OCC") may not at all times be adequate to handle current trading
volume, or (vi) one or more Exchanges could, for economic or other reasons,
decide or be compelled at some future date to discontinue the trading of options
(or a particular class or series of options), in which event the secondary
market on that Exchange (or in that class or series of options) would cease to
exist, although outstanding options on that Exchange that had been issued by the
OCC as a result of trades on that Exchange would continue to be exercisable in
accordance with their terms.
The Fund may write options in connection with buy-and-write transactions.
In other words, the Fund may buy a security and then write a call option against
that security. The exercise price of such call will depend upon the expected
price movement of the underlying security. The exercise price of a call option
may be below ("in-the-money"), equal to ("at-the-money") or above
("out-of-the-money") the current value of the underlying security at the time
the option is written. Buy-and-write transactions using in-the-money call
options may be used when it is expected that the price of the underlying
security will remain flat or decline moderately during the option period.
Buy-and-write transactions using at-the-money call options may be used when it
is expected that the price of the underlying security will remain fixed or
advance moderately during the option period. Buy-and-write transactions using
out-of-the-money call options may be used when it is expected that the premiums
received from writing the call option plus the appreciation in the market price
of the underlying security up to the exercise price will be greater than the
appreciation in the price of the underlying security alone. If the call options
are exercised in such transactions, the Fund's maximum gain will be the premium
received by it for writing the option, adjusted upwards or downwards by the
difference between the Fund's purchase price of the security and the exercise
price. If the options are not exercised and the price of the underlying security
declines, the amount of such decline will be offset by the amount of premium
received.
The writing of covered put options is similar in terms of risk and return
characteristics to buy-and-write transactions. If the market price of the
underlying security rises or otherwise is above the exercise price, the put
option will expire worthless and the Fund's gain will be limited to the premium
received. If the market price of the underlying security declines or otherwise
is below the exercise price, the Fund may elect to close the position or take
delivery of the security at the exercise price and the Fund's return will be the
premium received from the put options minus the amount by which the market price
of the security is below the exercise price.
The Fund may buy put options to hedge against a decline in the value of its
portfolio. By using put options in this way, the Fund will reduce any profit it
might otherwise have realized in the underlying security by the amount of the
premium paid for the put option and by transaction costs.
12
<PAGE>
The Fund may buy call options to hedge against an increase in the price of
securities that it may buy in the future. The premium paid for the call option
plus any transaction costs will reduce the benefit, if any, realized by the Fund
upon exercise of the option, and, unless the price of the underlying security
rises sufficiently, the option may expire worthless to the Fund.
Eurodollar Instruments. The Fund may make investments in Eurodollar
instruments. Eurodollar instruments are U.S. dollar-denominated futures
contracts or options thereon which are linked to the London Interbank Offered
Rate ("LIBOR"), although foreign currency-denominated instruments are available
from time to time. Eurodollar futures contracts enable purchasers to obtain a
fixed rate for the lending of funds and sellers to obtain a fixed rate for
borrowings. The Fund might use Eurodollar futures contracts and options thereon
to hedge against changes in LIBOR, to which many interest rate swaps and
fixed-income instruments are linked.
Swaps and Swap-Related Products. The Fund may enter into interest rate
swaps, caps and floors on either an asset-based or liability-based basis,
depending upon whether it is hedging its assets or its liabilities, and will
usually enter into interest rate swaps on a net basis (i.e., the two payment
streams are netted out, with the Fund receiving or paying, as the case may be,
only the net amount of the two payments). The net amount of the excess, if any,
of the Fund's obligations over its entitlement with respect to each interest
rate swap will be calculated on a daily basis and an amount of cash or other
liquid assets having an aggregate net asset value at least equal to the accrued
excess will be maintained in a segregated account by the Fund's custodian. If
the Fund enters into an interest rate swap on other than a net basis, it would
maintain a segregated account in the full amount accrued on a daily basis of its
obligations with respect to the swap. The Fund will not enter into any interest
rate swap, cap or floor transaction unless the unsecured senior debt or the
claims-paying ability of the other party thereto is rated in one of the three
highest rating categories of at least one NRSRO at the time of entering into
such transaction. Janus Capital will monitor the creditworthiness of all
counterparties on an ongoing basis. If there is a default by the other party to
such a transaction, the Fund will have contractual remedies pursuant to the
agreements related to the transaction.
The swap market has grown substantially in recent years with a large number
of banks and investment banking firms acting both as principals and as agents
utilizing standardized swap documentation. Janus Capital has determined that, as
a result, the swap market has become relatively liquid. Caps and floors are more
recent innovations for which standardized documentation has not yet been
developed and, accordingly, they are less liquid than swaps. To the extent the
Fund sells (i.e., writes) caps and floors, it will segregate cash or other
liquid assets having an aggregate net asset value at least equal to the full
amount, accrued on a daily basis, of its obligations with respect to any caps or
floors.
There is no limit on the amount of interest rate swap transactions that may
be entered into by the Fund. These transactions may in some instances involve
the delivery of securities or other underlying assets by the Fund or its
counterparty to collateralize obligations under the swap. Under the
documentation currently used in those markets, the risk of loss with respect to
interest rate swaps is limited to the net amount of the payments that the Fund
is contractually obligated to make. If the other party to an interest rate swap
that is not collateralized defaults, the Fund would risk the loss of the net
amount of the payments that it contractually is entitled to receive. The Fund
may buy and sell (i.e., write) caps and floors without limitation, subject to
the segregation requirement described above.
Additional Risks of Options on Foreign Currencies, Forward Contracts and
Foreign Instruments. Unlike transactions entered into by the Fund in futures
contracts, options on foreign currencies and forward contracts are not traded on
contract markets regulated by the CFTC or (with the exception of certain foreign
currency options) by the SEC. To the contrary, such instruments are traded
through financial institutions acting as market-makers, although foreign
currency options are also traded on certain Exchanges, such as the Philadelphia
Stock Exchange and the Chicago Board Options Exchange, subject to SEC
regulation. Similarly, options on currencies may be traded over-the-counter. In
an over-the-counter trading environment, many of the protections afforded to
Exchange participants will not be available. For example, there are no daily
price fluctuation limits, and adverse market movements could therefore continue
to an unlimited extent over a period of time. Although the buyer of an option
cannot lose more than the amount of the premium plus related transaction costs,
this entire amount could be lost. Moreover, an option writer and a buyer or
seller of futures or forward contracts could lose amounts substantially in
excess of any premium received or initial margin or collateral posted due to the
potential additional margin and collateral requirements associated with such
positions.
Options on foreign currencies traded on Exchanges are within the
jurisdiction of the SEC, as are other securities traded on Exchanges. As a
result, many of the protections provided to traders on organized Exchanges will
be available with respect to such transactions. In particular, all foreign
currency option positions entered into on an Exchange are cleared and guaranteed
by the OCC, thereby reducing the risk of counterparty default. Further, a liquid
secondary market in options traded on an Exchange may be more readily available
than in the over-the-counter market, potentially permitting the Fund to
liquidate open positions at a profit prior to exercise or expiration, or to
limit losses in the event of adverse market movements.
The purchase and sale of exchange-traded foreign currency options, however,
is subject to the risks of the availability of a liquid secondary market
described above, as well as the risks regarding adverse market movements,
margining of options written, the nature of the foreign currency market,
possible intervention by governmental authorities and the effects of other
political
13
<PAGE>
and economic events. In addition, exchange-traded options on foreign currencies
involve certain risks not presented by the over-the-counter market. For example,
exercise and settlement of such options must be made exclusively through the
OCC, which has established banking relationships in applicable foreign countries
for this purpose. As a result, the OCC may, if it determines that foreign
governmental restrictions or taxes would prevent the orderly settlement of
foreign currency option exercises, or would result in undue burdens on the OCC
or its clearing member, impose special procedures on exercise and settlement,
such as technical changes in the mechanics of delivery of currency, the fixing
of dollar settlement prices or prohibitions on exercise.
In addition, options on U.S. government securities, futures contracts,
options on futures contracts, forward contracts and options on foreign
currencies may be traded on foreign exchanges and over-the-counter in foreign
countries. Such transactions are subject to the risk of governmental actions
affecting trading in or the prices of foreign currencies or securities. The
value of such positions also could be adversely affected by (i) other complex
foreign political and economic factors, (ii) lesser availability than in the
United States of data on which to make trading decisions, (iii) delays in the
Fund's ability to act upon economic events occurring in foreign markets during
non-business hours in the United States, (iv) the imposition of different
exercise and settlement terms and procedures and margin requirements than in the
United States, and (v) low trading volume.
INVESTMENT ADVISER
As stated in the Prospectus, the Fund has an Investment Advisory Agreement
with Janus Capital, 100 Fillmore Street, Denver, Colorado 80206-4928. The
Advisory Agreement provides that Janus Capital will furnish continuous advice
and recommendations concerning the Fund's investments, provide office space for
the Fund, and pay the salaries, fees and expenses of all Fund officers and of
those Trustees who are affiliated with Janus Capital. Janus Capital also may
make payments to selected broker-dealer firms or institutions which perform
recordkeeping or other services with respect to shareholder accounts. The
minimum aggregate size required for eligibility for such payments, and the
factors in selecting the broker-dealer firms and institutions to which they will
be made, are determined from time to time by Janus Capital. Janus Capital is
also authorized to perform the management and administrative services necessary
for the operation of the Fund.
The Fund pays custodian and transfer agent fees and expenses, brokerage
commissions and dealer spreads and other expenses in connection with the
execution of portfolio transactions, legal and accounting expenses, interest and
taxes, registration fees, expenses of shareholders' meetings and reports to
shareholders, fees and expenses of Trustees who are not affiliated with Janus
Capital, costs of preparing, printing and mailing the Fund's Prospectus and SAI
to current shareholders, and other costs of complying with applicable laws
regulating the sale of Fund shares. Pursuant to the Advisory Agreement, Janus
Capital furnishes certain other services, including net asset value
determination and Fund accounting, recordkeeping, and blue sky registration and
monitoring services, for which the Fund may reimburse Janus Capital for its
costs.
For the period from inception through June 30, 1997, the Fund agreed to
compensate Janus Capital for its services by the monthly payment of a fee at the
annual rate of 1% of the first $30 million of the Fund's average daily net
assets, 0.75% of the next $270 million of the Fund's average daily net assets,
0.70% of the next $200 million of the Fund's average daily net assets, and 0.65%
of the average daily net assets of the Fund in excess of $500 million. As of
July 1, 1997, the Fund has agreed to compensate Janus Capital for its services
by the monthly payment of a fee at the annual rate of 0.75% on the first $300
million of the Fund's average daily net assets, 0.70% on the next $200 million
of the Fund's average daily net assets, and 0.65% of the average daily net
assets of the Fund in excess of $500 million.
For the fiscal period ended April 30, 1997, the investment advisory fee was
$251,309. Janus Capital did not waive any portion of its fee during this period.
The current Advisory Agreement became effective on September 10, 1996, and
it will continue in effect until June 16, 1998, and thereafter from year to year
so long as such continuance is approved annually by a majority of the Fund's
Trustees who are not parties to the Advisory Agreement or interested persons of
any such party, and by either a majority of the outstanding voting shares or the
Trustees of the Fund. The Advisory Agreement i) may be terminated without the
payment of any penalty by the Fund or Janus Capital on 60 days' written notice;
ii) terminates automatically in the event of its assignment; and iii) generally,
may not be amended without the approval by vote of a majority of the Trustees of
the Fund, including the Trustees who are not interested persons of the Fund or
Janus Capital and, to the extent required by the 1940 Act, the vote of a
majority of the outstanding voting securities of the Fund.
Janus Capital also performs investment advisory services for other mutual
funds, and for individual, charitable, corporate and retirement accounts.
Investment decisions for each account managed by Janus Capital, including the
Fund, are made independently from those for any other account that is or may in
the future become managed by Janus Capital or its affiliates. If, however, a
number of accounts managed by Janus Capital are contemporaneously engaged in the
purchase or sale of the same security, the orders may be aggregated and/or the
transactions may be averaged as to price and allocated equitably to each
account. In some cases, this policy might adversely affect the price paid or
received by an account or the size of the position obtained or liquidated for an
account. Pursuant to an exemptive order granted by the SEC, the Fund and other
funds advised by Janus Capital may also transfer daily uninvested cash balances
into one or more joint trading accounts. Assets in the joint trading accounts
are invested in money market instruments and the proceeds are allocated to the
participating Funds on a pro rata basis.
14
<PAGE>
Each account managed by Janus Capital has its own investment objective and
policies and is managed accordingly by a particular portfolio manager or team of
portfolio managers. As a result, from time to time two or more different managed
accounts may pursue divergent investment strategies with respect to investments
or categories of investments.
As indicated in the Prospectus, Janus Capital does not permit portfolio
managers to purchase and sell securities for their own accounts except under the
limited exceptions contained in Janus Capital's policy regarding personal
investing by directors, officers and employees of Janus Capital and the Fund.
The policy requires investment personnel and officers of Janus Capital, inside
directors of Janus Capital and the Fund and other designated persons deemed to
have access to current trading information to pre-clear all transactions in
securities not otherwise exempt under the policy. Requests for trading authority
will be denied when, among other reasons, the proposed personal transaction
would be contrary to the provisions of the policy or would be deemed to
adversely affect any transaction known to be under consideration for or to have
been effected on behalf of any client account, including the Fund.
In addition to the pre-clearance requirement described above, the policy
subjects investment personnel, officers and directors/Trustees of Janus Capital
and the Fund to various trading restrictions and reporting obligations. All
reportable transactions are reviewed for compliance with Janus Capital's policy.
Those persons also may be required under certain
circumstances to forfeit their profits made from personal trading.
The provisions of the policy are administered by and subject to exceptions
authorized by Janus Capital.
Kansas City Southern Industries, Inc., a publicly traded holding company
whose primary subsidiaries are engaged in transportation, information processing
and financial services ("KCSI"), owns approximately 83% of Janus Capital. Thomas
H. Bailey, the President and Chairman of the Board of Janus Capital, owns
approximately 12% of its voting stock and, by agreement with KCSI, selects a
majority of Janus Capital's Board.
CUSTODIAN, TRANSFER AGENT AND CERTAIN AFFILIATIONS
State Street Bank and Trust Company ("State Street"), P.O. Box 0351,
Boston, Massachusetts 02117-0351, is the custodian of the domestic securities
and cash of the Fund. State Street and the foreign subcustodians selected by it
and approved by the Trustees, have custody of the assets of the Fund held
outside the U.S. and cash incidental thereto. The custodian and subcustodians
hold the Fund's assets in safekeeping and collect and remit the income thereon,
subject to the instructions of the Fund.
Janus Service Corporation ("Janus Service"), P.O. Box 173375, Denver,
Colorado 80217-3375, a wholly-owned subsidiary of Janus Capital, is the Fund's
transfer agent. In addition, Janus Service provides certain other
administrative, recordkeeping and shareholder relations services to the Fund.
For transfer agency and other services, Janus Service receives a fee calculated
at an annual rate of .16% of average net assets and, in addition, $4 per open
shareholder account. In addition, the Fund pays DST Systems, Inc. ("DST"), a
subsidiary of KCSI, license fees at the rate of $2.56 per shareholder account
for the use of DST's shareholder accounting system. The Fund pays DST for the
use of their portfolio and fund accounting system a base fee paid monthly
between $250 to $1,250 based on the number of Janus funds utilizing the system
and an asset charge of $1 per million dollars of net assets (not to exceed $500
per month). In addition, the Fund pays DST postage and forms costs of a DST
affiliate incurred in mailing Fund shareholder transaction confirmations.
The Trustees have authorized the Fund to use another affiliate of DST as
introducing broker for certain Fund portfolio transactions as a means to reduce
Fund expenses through a credit against the charges of DST and its affiliates
with regard to commissions earned by such affiliate. See "Portfolio Transactions
and Brokerage."
Janus Distributors, Inc. ("Janus Distributors"), 100 Fillmore Street,
Denver, Colorado 80206-4928, a wholly-owned subsidiary of Janus Capital, is a
distributor of the Fund. Janus Distributors is registered as a broker-dealer
under the Securities Exchange Act of 1934 (the "Exchange Act") and is a member
of the National Association of Securities Dealers, Inc. Janus Distributors acts
as the agent of the Fund in connection with the sale of its shares in all states
in which the shares are registered and in which Janus Distributors is qualified
as a broker-dealer. Under the Distribution Agreement, Janus Distributors
continuously offers the Fund's shares and accepts orders at net asset value. No
sales charges are paid by investors. Promotional expenses in connection with
offers and sales of shares are paid by Janus Capital.
PORTFOLIO TRANSACTIONS AND BROKERAGE
Decisions as to the assignment of portfolio business for the Fund and
negotiation of its commission rates are made by Janus Capital whose policy is to
obtain the "best execution" (prompt and reliable execution at the most favorable
security price) of all portfolio transactions. The Fund may trade foreign
securities in foreign countries because the best available market for these
securities is often on foreign exchanges. In transactions on foreign stock
exchanges, brokers' commissions are frequently fixed and are often higher than
in the United States, where commissions are negotiated.
In selecting brokers and dealers and in negotiating commissions, Janus
Capital considers a number of factors, including but not limited to: Janus
Capital's knowledge of currently
15
<PAGE>
available negotiated commission rates or prices of securities currently
available and other current transaction costs; the nature of the security being
traded; the size and type of the transaction; the nature and character of the
markets for the security to be purchased or sold; the desired timing of the
trade; the activity existing and expected in the market for the particular
security; confidentiality; the quality of the execution, clearance and
settlement services; financial stability of the broker or dealer; the existence
of actual or apparent operational problems of any broker or dealer; rebates of
commissions by a broker to the Fund or to a third party service provider to the
Fund to pay Fund expenses; and research products or services provided. In
recognition of the value of the foregoing factors, Janus Capital may place
portfolio transactions with a broker or dealer with whom it has negotiated a
commission that is in excess of the commission another broker or dealer would
have charged for effecting that transaction if Janus Capital determines in good
faith that such amount of commission was reasonable in relation to the value of
the brokerage and research provided by such broker or dealer viewed in terms of
either that particular transaction or of the overall responsibilities of Janus
Capital. Research may include furnishing advice, either directly or through
publications or writings, as to the value of securities, the advisability of
purchasing or selling specific securities and the availability of securities or
purchasers or sellers of securities; furnishing seminars, information, analyses
and reports concerning issuers, industries, securities, trading markets and
methods, legislative developments, changes in accounting practices, economic
factors and trends and portfolio strategy; access to research analysts,
corporate management personnel, industry experts, economists and government
officials; comparative performance evaluation and technical measurement services
and quotation services, and products and other services (such as third party
publications, reports and analyses, and computer and electronic access,
equipment, software, information and accessories that deliver, process or
otherwise utilize information, including the research described above) that
assist Janus Capital in carrying out its responsibilities.
Most broker dealers used by Janus Capital provide research and other
services described above. For the fiscal period ended April 30, 1997, the Fund
paid $48,582 of its total brokerage commissions to brokers and dealers in
transactions identified for execution primarily on the basis of research and
other services provided to the Fund on transactions of $32,031,532. Research
received from brokers or dealers is supplemental to Janus Capital's own research
efforts.
Janus Capital may use research products and services in servicing other
accounts in addition to the Fund. If Janus Capital determines that any research
product or service has a mixed use, such that it also serves functions that do
not assist in the investment decision-making process, Janus Capital may allocate
the costs of such service or product accordingly. Only that portion of the
product or service that Janus Capital determines will assist it in the
investment decision-making process may be paid for in brokerage commission
dollars. Such allocation may create a conflict of interest for Janus Capital.
Janus Capital does not enter into agreements with any brokers regarding the
placement of securities transactions because of the research services they
provide. It does, however, have an internal procedure for allocating
transactions in a manner consistent with its execution policy to brokers that it
has identified as providing superior executions and research, research-related
products or services which benefit its advisory clients, including the Fund.
Research products and services incidental to effecting securities transactions
furnished by brokers or dealers may be used in servicing any or all of Janus
Capital's clients and such research may not necessarily be used by Janus Capital
in connection with the accounts which paid commissions to the broker-dealer
providing such research products and services.
Janus Capital may consider sales of Fund shares by a broker-dealer or the
recommendation of a broker-dealer to its customers that they purchase Fund
shares as a factor in the selection of broker-dealers to execute Fund portfolio
transactions. Janus Capital may also consider payments made by brokers effecting
transactions for the Fund i) to the Fund or ii) to other persons on behalf of
the Fund for services provided to the Fund for which it would be obligated to
pay. In placing portfolio business with such broker-dealers, Janus Capital will
seek the best execution of each transaction.
When the Fund purchases or sells a security in the over-the-counter market,
the transaction takes place directly with a principal market-maker, without the
use of a broker, except in those circumstances where in the opinion of Janus
Capital better prices and executions will be achieved through the use of a
broker.
The Fund's Trustees have authorized Janus Capital to place transactions
with DST Securities, Inc. ("DSTS"), a wholly-owned broker-dealer subsidiary of
DST. Janus Capital may do so if it reasonably believes that the quality of the
transaction and the associated commission are fair and reasonable and if,
overall, the associated transaction costs, net of any credits described above
under "Custodian, Transfer Agent and Certain Affiliations," are lower than those
that would otherwise be incurred.
The total amount of brokerage commissions paid by the Fund during the
fiscal period ended April 30, 1997, was $233,435. Included in the brokerage
commissions paid for the fiscal period was $1,651 paid through DSTS which served
to reduce by $1,239 certain out-of-pocket expenses paid by the Fund. Brokerage
commissions paid through DSTS for the fiscal period represented .71% of the
Fund's aggregate brokerage commissions for such fiscal period, while .01% of the
aggregate dollar amount of the Fund's portfolio transactions involving a
commission payment were executed through DSTS. The difference between
commissions paid to DSTS and expenses reduced constitute commissions paid to an
unaffiliated clearing broker. Differences in the percentage of total commissions
versus the percentage of total transactions is due, in part, to variations among
share prices and number of shares traded, while average price per share
commission rates were substantially the same.
For the fiscal period ended April 30, 1997, the Fund did not own securities
of a regular broker-dealer.
16
<PAGE>
OFFICERS AND TRUSTEES
The following are the names of the Trustees and officers of the Trust,
together with a brief description of their principal occupations during the last
five years. In August 1992, Janus Venture Fund, Inc. and Janus Twenty Fund, Inc.
(both separate Maryland corporations) and the Janus Income Series (a
Massachusetts business trust comprised of Janus Flexible Income Fund and Janus
Intermediate Government Securities Fund series) were reorganized into separate
series of the Trust. In general, all references to Trust offices in this section
include comparable offices with the respective predecessor funds, unless a Trust
office was filled subsequent to the reorganization.
Thomas H. Bailey*# - Trustee, Chairman and President
100 Fillmore Street
Denver, CO 80206-4928
Trustee, Chairman and President of Janus Aspen Series. Chairman, Chief
Executive Officer, Director and President of Janus Capital. Chairman and
Director of IDEX Management, Inc., Largo, Florida (50% subsidiary of Janus
Capital and investment adviser to a group of mutual funds) ("IDEX").
James P. Craig, III*# - Trustee and Executive Vice President
100 Fillmore Street
Denver, CO 80206-4928
Trustee and Executive Vice President of Janus Aspen Series. Chief
Investment Officer, Vice President and Director of Janus Capital. Executive
Vice President and Portfolio Manager of Janus Fund. Executive Vice
President and Co-Manager of Janus Venture Fund.
David C. Decker* - Executive Vice President
100 Fillmore Street
Denver, CO 80206-4928
Executive Vice President and Portfolio Manager of Janus Special Situations
Fund. Formerly, research analyst at Janus Capital (1992-1996). Obtained an
M.B.A. in finance from the Fuqua School of Business at Duke University
(1990-1992).
Steven R. Goodbarn* - Vice President and Chief Financial Officer
100 Fillmore Street
Denver, CO 80206-4928
Vice President and Chief Financial Officer of Janus Aspen Series. Vice
President of Finance, Treasurer and Chief Financial Officer of Janus
Service, Janus Distributors and Janus Capital Director of IDEX and Janus
Distributors. Director, Treasurer and Vice President of Finance of Janus
Capital International Ltd. Formerly (May 1992-January 1996), Treasurer of
Janus Investment Fund and Janus Aspen Series.
Glenn P. O'Flaherty* - Treasurer and Chief Accounting Officer
100 Fillmore Street
Denver, CO 80206-4928
Treasurer and Chief Accounting Officer of Janus Aspen Series. Director of
Fund Accounting of Janus Capital.
Kelley Abbott Howes* - Secretary
100 Fillmore Street
Denver, CO 80206-4928
Secretary of Janus Aspen Series. President, Janus Distributors, Inc.
Associate Counsel of Janus Capital. Formerly (1990 to 1994), with The
Boston Company Advisors, Inc., Boston, Massachusetts (mutual fund
administration services).
William D. Stewart# - Trustee
5330 Sterling Drive
Boulder, CO 80302
Trustee of Janus Aspen Series. President of HPS Corporation, Boulder,
Colorado (manufacturer of vacuum fittings and valves).
Gary O. Loo - Trustee
102 N. Cascade, Suite 500
Colorado Springs, CO 80903
Trustee of Janus Aspen Series. President and a Director of High Valley
Group, Inc., Colorado Springs, Colorado (investments).
- --------------------------------------------------------------------------------
* Interested person of the Trust and of Janus Capital.
# Member of the Trust's Executive Committee.
17
<PAGE>
Dennis B. Mullen - Trustee
14103 Denver West Parkway
Golden, CO 80401
Trustee of Janus Aspen Series. President and Chief Executive Officer of BC
Northwest, L.P., a franchise of Boston Chicken, Inc., Bellevue, Washington
(restaurant chain). Formerly (1982 to 1993), Chairman, President and Chief
Executive Officer of Famous Restaurants, Inc., Scottsdale, Arizona
(restaurant chain).
Martin H. Waldinger - Trustee
4940 Sandshore Court
San Diego, CA 92130
Trustee of Janus Aspen Series. Private Consultant and Director of Run
Technologies, Inc., a software development firm, San Carlos, California.
Formerly (1989 to 1993), President and Chief Executive Officer of
Bridgecliff Management Services, Campbell, California (a condominium
association management company).
James T. Rothe - Trustee
102 South Tejon Street, Suite 1100
Colorado Springs, CO 80903
Trustee of Janus Aspen Series. Professor of Business, University of
Colorado, Colorado Springs, Colorado. Principal, Phillips-Smith Retail
Group, Colorado Springs, Colorado (a venture capital firm). Formerly
(1986-1994), Dean of the College of Business, University of Colorado,
Colorado Springs, Colorado.
The Trustees are responsible for major decisions relating to the Fund's
objective, policies and techniques. The Trustees also supervise the operation of
the Fund by its officers and review the investment decisions of the officers
although they do not actively participate on a regular basis in making such
decisions.
The Executive Committee of the Trustees shall have and may exercise all the
powers and authority of the Board except for matters requiring action by the
whole Board pursuant to the Trust's Bylaws or Agreement and Declaration of Trust
("Declaration of Trust"), Massachusetts law or the 1940 Act.
The following table shows the aggregate compensation earned by and paid to
each Trustee by the Fund described in this SAI and all funds advised and
sponsored by Janus Capital (collectively, the "Janus Funds") for the periods
indicated. None of the Trustees receive any pension or retirement from the Fund
or the Janus Funds.
<TABLE>
Aggregate Compensation Total Compensation
from the from the
Fund for fiscal year Janus Funds for calendar year
Name of Person, Position ended October 31, 1996** ended December 31, 1996***
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Thomas H. Bailey, Chairman* $0 $0
James P. Craig, III, Trustee* $0 $0
John W. Shepardson, Trustee+ $0 $73,000
William D. Stewart, Trustee $0 $70,000
Gary O. Loo, Trustee $0 $70,000
Dennis B. Mullen, Trustee $0 $67,000
Martin H. Waldinger, Trustee $0 $73,000
James T. Rothe, Trustee++ $0 $0
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* An interested person of the Fund and of Janus Capital. Compensated by Janus
Capital and not the Fund.
** The Fund had not commenced operations as of October 31, 1996.
*** As of December 31, 1996, Janus Funds consisted of two registered investment
companies comprised of a total of 29 funds.
+ Mr. Shepardson retired on March 31, 1997.
++ Mr. Rothe began serving as Trustee on January 1, 1997.
PURCHASE OF SHARES
As stated in the Prospectus, Janus Distributors is a distributor of the
Fund's shares. Shares of the Fund are sold at the net asset value per share as
determined at the close of the regular trading session of the New York Stock
Exchange (the "NYSE") next occurring after a purchase order is received and
accepted by the Fund. The Shareholder's Manual Section of the Prospectus
contains detailed information about the purchase of shares.
NET ASSET VALUE DETERMINATION
As stated in the Prospectus, the net asset value ("NAV") of Fund shares is
determined once each day on which the New York Stock Exchange ("NYSE") is open,
at the close of its regular trading session (normally 4:00 p.m., New York time,
Monday through Friday). The NAV of Fund shares is not determined on days the
NYSE is closed (generally, New Year's Day, Martin Luther King Day,
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<PAGE>
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas). The per share NAV of the Fund is determined by
dividing the total value of the Fund's securities and other assets, less
liabilities, by the total number of shares outstanding. In determining NAV,
securities listed on an Exchange, the NASDAQ National Market and foreign markets
are valued at the closing prices on such markets, or if such price is lacking
for the trading period immediately preceding the time of determination, such
securities are valued at their current bid price. Municipal securities held by
the Fund are traded primarily in the over-the-counter market. Valuations of such
securities are furnished by one or more pricing services employed by the Fund
and are based upon a computerized matrix system or appraisals obtained by a
pricing service, in each case in reliance upon information concerning market
transactions and quotations from recognized municipal securities dealers. Other
securities that are traded on the over-the-counter market are valued at their
closing bid prices. Foreign securities and currencies are converted to U.S.
dollars using the exchange rate in effect at the close of the NYSE. The Fund
will determine the market value of individual securities held by it, by using
prices provided by one or more professional pricing services which may provide
market prices to other funds, or, as needed, by obtaining market quotations from
independent broker-dealers. Short-term securities maturing within 60 days are
valued on the amortized cost basis. Securities for which quotations are not
readily available, and other assets, are valued at fair values determined in
good faith under procedures established by and under the supervision of the
Trustees.
Trading in securities on European and Far Eastern securities exchanges and
over-the-counter markets is normally completed well before the close of business
on each business day in New York (i.e., a day on which the NYSE is open). In
addition, European or Far Eastern securities trading generally or in a
particular country or countries may not take place on all business days in New
York. Furthermore, trading takes place in Japanese markets on certain Saturdays
and in various foreign markets on days which are not business days in New York
and on which the Fund's NAV is not calculated. The Fund calculates its NAV per
share, and therefore effects sales, redemptions and repurchases of its shares,
as of the close of the NYSE once on each day on which the NYSE is open. Such
calculation may not take place contemporaneously with the determination of the
prices of the foreign portfolio securities used in such calculation.
REINVESTMENT OF DIVIDENDS AND DISTRIBUTIONS
If investors do not elect in writing or by phone to receive their dividends
and distributions in cash, all income dividends and capital gains distributions,
if any, on the Fund's shares are reinvested automatically in additional shares
of the Fund at the NAV determined on the first business day following the record
date. Checks for cash dividends and distributions and confirmations of
reinvestments are usually mailed to shareholders within ten days after the
record date. Any election of the manner in which a shareholder wishes to receive
dividends and distributions (which may be made on the New Account Application
form or by phone) will apply to dividends and distributions the record dates of
which fall on or after the date that the Fund receives such notice. Investors
receiving cash distributions and dividends may elect in writing or by phone to
change back to automatic reinvestment at any time.
REDEMPTION OF SHARES
Procedures for redemption of shares are set forth in the Shareholder's
Manual section of the Prospectus. Shares normally will be redeemed for cash,
although the Fund retains the right to redeem its shares in kind under unusual
circumstances, in order to protect the interests of remaining shareholders, by
delivery of securities selected from its assets at its discretion. However, the
Fund is governed by Rule 18f-1 under the 1940 Act, which requires the Fund to
redeem shares solely in cash up to the lesser of $250,000 or 1% of the NAV of
the Fund during any 90-day period for any one shareholder. Should redemptions by
any shareholder exceed such limitation, the Fund will have the option of
redeeming the excess in cash or in kind. If shares are redeemed in kind, the
redeeming shareholder might incur brokerage costs in converting the assets to
cash. The method of valuing securities used to make redemptions in kind will be
the same as the method of valuing portfolio securities described under "Purchase
of Shares - Net Asset Value Determination" and such valuation will be made as of
the same time the redemption price is determined. The shareholder has the
ability to request a review of valuation in-kind redemptions by the Trustee at
their next regularly scheduled meeting.
The right to require the Fund to redeem its shares may be suspended, or the
date of payment may be postponed, whenever (1) trading on the NYSE is
restricted, as determined by the SEC, or the NYSE is closed except for holidays
and weekends, (2) the SEC permits such suspension and so orders, or (3) an
emergency exists as determined by the SEC so that disposal of securities or
determination of NAV is not reasonably practicable.
SHAREHOLDER ACCOUNTS
Detailed information about the general procedures for shareholder accounts
and specific types of accounts is set forth in the Prospectus. Applications for
specific types of accounts may be obtained by calling the Fund at 1-800-525-3713
or writing to the Fund at P.O. Box 173375, Denver, Colorado 80217-3375.
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TELEPHONE TRANSACTIONS
As stated in the Prospectus, shareholders may initiate a number of
transactions by telephone. The Fund, its transfer agent and its distributor
disclaim responsibility for the authenticity of instructions received by
telephone. Such entities will employ reasonable procedures to confirm that
instructions communicated by telephone are genuine. Such procedures may include,
among others, requiring personal identification prior to acting upon telephone
instructions, providing written confirmation of the transactions and tape
recording telephone conversations.
SYSTEMATIC REDEMPTIONS
As stated in the Shareholder's Manual section of the Prospectus, if you
have a regular account or are eligible for normal distributions from a
retirement plan, you may establish a systematic redemption option. The payments
will be made from the proceeds of periodic redemptions of shares in the account
at the NAV. Depending on the size or frequency of the disbursements requested,
and the fluctuation in value of the Fund's portfolio, redemptions for the
purpose of making such disbursements may reduce or even exhaust the
shareholder's account. Either an investor or the Fund, by written notice to the
other, may terminate the investor's systematic redemption option without penalty
at any time.
Information about requirements to establish a systematic redemption option
may be obtained by writing or calling the Fund at the address or phone number
shown above.
RETIREMENT PLANS
The Fund offers several different types of tax-deferred retirement plans
that an investor may establish to invest in Fund shares, depending on rules
prescribed by the Code. The Individual Retirement Account ("IRA") may be used by
most individuals who have taxable compensation. Simplified Employee Pension
Plans ("SEPs") and Defined Contribution Plans (Profit Sharing or Money Purchase
Pension Plans) may be used by most employers, including corporations,
partnerships and sole proprietors, for the benefit of business owners and their
employees. In addition, the Fund offers a Section 403(b)(7) Plan for employees
of educational organizations and other qualifying tax-exempt organizations.
Investors should consult their tax advisor or legal counsel before selecting a
retirement plan.
Contributions under IRAs, SEPs, Defined Contribution Plans and Section
403(b)(7) Plans are subject to specific contribution limitations. Generally,
such contributions may be invested at the direction of the participant. The
investment is then held by Investors Fiduciary Trust Company as custodian. Each
participant's account is charged an annual fee of $12. There is a maximum annual
fee of $24 per taxpayer identification number.
Distributions from retirement plans generally are subject to ordinary
income tax and may be subject to an additional 10% tax if withdrawn prior to age
591/2. Several exceptions to the general rule may apply. Additionally,
shareholders generally must start withdrawing retirement plan assets no later
than April 1 of the year after they reach age 701/2. Exceptions may apply so
please consult your tax advisor. Several methods exist to determine the amount
of the minimum annual distribution. Shareholders should consult with their tax
advisor or legal counsel prior to receiving any distribution from any retirement
plan, in order to determine the income tax impact of any such distribution.
To receive additional information about IRAs, SEPs, Defined Contribution
Plans and Section 403(b)(7) Plans along with the necessary materials to
establish an account, please call the Fund at 1-800-525-3713 or write to the
Fund at P.O. Box 173375, Denver, Colorado 80217-3375. No contribution to an IRA,
SEP, Defined Contribution Plan or Section 403(b)(7) Plan can be made until the
appropriate forms to establish any such plan have been completed.
INCOME DIVIDENDS, CAPITAL GAINS DISTRIBUTIONS AND TAX STATUS
It is a policy of the Fund to make distributions of substantially all of
its investment income and any net realized capital gains. The Fund declares and
makes annual distributions of income (if any). Any capital gains realized during
each fiscal year ended October 31, as defined by the Code, are normally declared
and payable to shareholders in December. The Fund intends to qualify as a
regulated investment company by satisfying certain requirements prescribed by
Subchapter M of the Code.
The Fund may purchase securities of certain foreign corporations considered
to be passive foreign investment companies by the IRS. In order to avoid taxes
and interest that must be paid by the Fund, if these instruments are profitable,
the Fund may make various elections permitted by the tax laws. However, these
elections could require that the Fund recognize taxable income, which in turn
must be distributed.
Some foreign securities purchased by the Fund may be subject to foreign
taxes which could reduce the yield on such securities. The amount of such
foreign taxes is expected to be insignificant. Accordingly, the Fund does not
intend to make the election permitted under section 853 of the Code to pass
through such taxes to shareholders as a foreign tax credit as this would
increase
20
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the taxable income reported to shareholders and require shareholders to take the
credit on their tax returns, complicating the preparation of such returns. As a
result, any foreign taxes paid or accrued will represent an expense to the Fund
which will reduce its investment company taxable income.
PRINCIPAL SHAREHOLDERS
As of June 3, 1997, the officers and Trustees of the Fund as a group owned
less than 1% of the outstanding shares of the Fund. In addition, as of June 3,
1997, Charles Schwab & Co., Inc. ("Schwab"), 101 Montgomery Street, San
Francisco, CA 94104-4122, and National Financial Services, Co. ("National
Financial"), P.O. Box 3908, Church Street Station, New York, NY 10008-3908,
owned of record 10.49% and 5.23%, respectively, of the Fund's outstanding
shares. According to information provided by Schwab and National Financial, this
ownership is by nominee only and does not represent beneficial ownership of such
shares, because they have no investment discretion or voting power with respect
to such shares. To the knowledge of the Fund, no other person owned more than 5%
of the outstanding shares of the Fund as of the above date.
MISCELLANEOUS INFORMATION
The Fund is a series of the Trust, a Massachusetts business trust which was
created on February 11, 1986. The Trust is an open-end management investment
company registered under the 1940 Act. As of the date of this SAI, the Trust
offers 18 other series by other prospectuses.
Janus Capital reserves the right to the name "Janus." In the event that
Janus Capital does not continue to provide investment advice to the Fund, the
Fund must cease to use the name "Janus" as soon as reasonably practicable.
Under Massachusetts law, shareholders of the Fund could, under certain
circumstances, be held liable for the obligations of the Fund. However, the
Declaration of Trust disclaims shareholder liability for acts or obligations of
the Fund and requires that notice of this disclaimer be given in each agreement,
obligation or instrument entered into or executed by the Fund or the Trustees.
The Declaration of Trust also provides for indemnification from the assets of
the Fund for all losses and expenses of any Fund shareholder held liable for the
obligations of the Fund. Thus, the risk of a shareholder incurring a financial
loss on account of its liability as a shareholder of the Fund is limited to
circumstances in which the Fund would be unable to meet its obligations. The
possibility that these circumstances would occur is remote. The Trustees intend
to conduct the operations of the Fund to avoid, to the extent possible,
liability of shareholders for liabilities of the Fund.
SHARES OF THE TRUST
The Trust is authorized to issue an unlimited number of shares of
beneficial interest with a par value of one cent per share for each series of
the Trust. Shares of the Fund are fully paid and nonassessable when issued. All
shares of the Fund participate equally in dividends and other distributions by
the Fund, and in residual assets of the Fund in the event of liquidation. Shares
of the Fund have no preemptive, conversion or subscription rights. Shares of the
Fund may be transferred by endorsement or stock power as is customary, but the
Fund is not bound to recognize any transfer until it is recorded on its books.
VOTING RIGHTS
The present Trustees were elected at a meeting of shareholders held on July
10, 1992, with the exception of Mr. Craig and Mr. Rothe who were appointed by
the Trustees as of June 30, 1995 and January 1, 1997, respectively. Under the
Declaration of Trust, each Trustee will continue in office until the termination
of the Trust or his earlier death, retirement, resignation, bankruptcy,
incapacity or removal. Vacancies will be filled by a majority of the remaining
Trustees, subject to the 1940 Act. Therefore, no annual or regular meetings of
shareholders normally will be held, unless otherwise required by the Declaration
of Trust or the 1940 Act. Subject to the foregoing, shareholders have the power
to vote to elect or remove Trustees, to terminate or reorganize the Fund, to
amend the Declaration of Trust, to bring certain derivative actions and on any
other matters on which a shareholder vote is required by the 1940 Act, the
Declaration of Trust, the Trust's Bylaws or the Trustees.
Each share of the Fund and of each other series of the Trust has one vote
(and fractional votes for fractional shares). Shares of all series of the Trust
have noncumulative voting rights, which means that the holders of more than 50%
of the shares of all series of the Trust voting for the election of Trustees can
elect 100% of the Trustees if they choose to do so and, in such event, the
holders of the remaining shares will not be able to elect any Trustees. The Fund
and each other series of the Trust will vote separately only with respect to
those matters that affect only that series or if a portfolio's interest in a
matter differs from the interests of other portfolios of the Trust.
INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP, 950 Seventeenth Street, Suite 2500, Denver, Colorado
80202, independent accountants for the Fund, audit the Fund's annual financial
statements and prepare its tax returns.
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REGISTRATION STATEMENT
The Trust has filed with the SEC, Washington, D.C., a Registration
Statement under the Securities Act of 1933, as amended, with respect to the
securities to which this SAI relates. If further information is desired with
respect to the Fund or such securities, reference is made to the Registration
Statement and the exhibits filed as a part thereof.
PERFORMANCE INFORMATION
The Prospectus contains a brief description of how performance is
calculated.
Quotations of average annual total return for the Fund will be expressed in
terms of the average annual compounded rate of return of a hypothetical
investment in the Fund over periods of 1, 5, and 10 years (up to the life of the
Fund). These are the annual total rates of return that would equate the initial
amount invested to the ending redeemable value. These rates of return are
calculated pursuant to the following formula: P(1 + T)n = ERV (where P = a
hypothetical initial payment of $1,000, T = the average annual total return, n =
the number of years and ERV = the ending redeemable value of a hypothetical
$1,000 payment made at the beginning of the period). All total return figures
reflect the deduction of a proportional share of Fund expenses on an annual
basis, and assume that all dividends and distributions are reinvested when paid.
The Fund was made available for public sale on December 31, 1996. The
lifetime total return, for the period December 31, 1996 through April 30, 1997
was 8.30%.
Quotations of the Fund's yield are based on the investment income per share
earned during a particular 30-day period (including dividends, if any, and
interest), less expenses accrued during the period ("net investment income"),
and are computed by dividing net investment income by the net asset value per
share on the last day of the period, according to the following formula:
YIELD = 2 [(a-b + 1)6 - 1]
cd
where a = dividend and interest income
b = expenses accrued for the period
c = average daily number of shares outstanding during the period that were
entitled to receive dividends
d = maximum net asset value per share on the last day of the period
From time to time in advertisements or sales material, the Fund may discuss
its performance ratings or other information as published by recognized mutual
fund statistical rating services, including, but not limited to, Lipper
Analytical Services, Inc., Ibbotson Associates, Micropal or Morningstar or by
publications of general interest such as Forbes or Money. The Fund may also
compare its performance to that of other selected mutual funds, mutual fund
averages or recognized stock market indicators, including, but not limited to,
the Standard & Poor's 500 Composite Stock Price Index, the Standard & Poor's 400
Midcap Index, the Dow Jones Industrial Average, the Lehman Brothers
Government/Corporate Bond Index, the Lehman Brothers Government/ Corporate 1-3
Year Bond Index, the Lehman Brothers Long Government/Corporate Bond Index, the
Lehman Brothers Intermediate Government Bond Index, the Lehman Brothers
Municipal Bond Index, the Russell 2000 Index and the NASDAQ composite. In
addition, the Fund may compare its total return to the yield on U.S. Treasury
obligations and to the percentage change in the Consumer Price Index. Such
performance ratings or comparisons may be made with funds that may have
different investment restrictions, objectives, policies or techniques than the
Fund and such other funds or market indicators may be comprised of securities
that differ significantly from the Fund's investments.
FINANCIAL STATEMENTS
The following unaudited financial statements for the period ended April 30,
1997 are hereby incorporated into this SAI by reference to the Fund's Semiannual
Report dated April 30, 1997. A copy of such report accompanies this SAI.
DOCUMENTS INCORPORATED BY REFERENCE TO THE SEMIANNUAL REPORT:
Schedule of Investments as of April 30, 1997
Statement of Operations for the period December 31, 1996 to April 30, 1997
Statement of Assets and Liabilities as of April 30, 1997
Statement of Changes in Net Assets for the period December 31, 1996 to
April 30, 1997
Financial Highlights for the period December 31, 1996 to April 30, 1997
Notes to Financial Statements
The portions of such Semiannual Report that are not specifically listed
above are not incorporated by reference into this SAI and are not part of the
Registration Statement.
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JANUS INVESTMENT FUND
PART C - OTHER INFORMATION
ITEM 24. Financial Statements and Exhibits
List all financial statements and exhibits filed as part of the
Registration Statement.
(a)(1) Financial Statements Included in the Prospectus:
Financial Highlights for Janus Special Situations Fund
(a)(2) Financial Statements Incorporated by Reference into the Statement
of Additional Information:
The Financial Statements for Janus Special Situations Fund
dated April 30, 1997, are incorporated by reference into the
Statement of Additional Information.
(b) Exhibits:
Exhibit 1 (a) Agreement and Declaration of Trust dated
February 11, 1986 is incorporated herein
by reference to Exhibit 1(a) to
Post-Effective Amendment No. 79.
(b) Certificate of Designation for Janus
Growth and Income Fund is incorporated
herein by reference to Exhibit 1(b) to
Post-Effective Amendment No. 79.
(c) Certificate of Designation for Janus
Worldwide Fund is incorporated herein by
reference to Exhibit 1(c) to Post-
Effective Amendment No. 79.
(d) Certificate of Designation for Janus
Twenty Fund is incorporated herein by
reference to Exhibit 1(d) to Post-
Effective Amendment No. 80.
(e) Certificate of Designation for Janus
Flexible Income Fund is incorporated
herein by reference to Exhibit 1(e) to
Post-Effective Amendment No. 80.
(f) Certificate of Designation for Janus
Intermediate Government Securities Fund
is hereby withdrawn.
(g) Certificate of Designation for Janus
Venture Fund is incorporated herein by
reference to Exhibit 1(g) to Post-
Effective Amendment No. 80.
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(h) Certificate of Designation for Janus
Enterprise Fund is incorporated herein
by reference to Exhibit 1(h) to Post-
Effective Amendment No. 80.
(i) Certificate of Designation for Janus
Balanced Fund is incorporated herein by
reference to Exhibit 1(i) to Post-
Effective Amendment No. 80.
(j) Certificate of Designation for Janus
Short-Term Bond Fund is incorporated
herein by reference to Exhibit 1(j) to
Post-Effective Amendment No. 80.
(k) Certificate of Designation for Janus
Federal Tax-Exempt Fund is filed herein
as Exhibit 1(k).
(l) Certificate of Designation for Janus
Mercury Fund is filed herein as Exhibit
1(l).
(m) Certificate of Designation for Janus
Overseas Fund is filed herein as Exhibit
1(m).
(n) Form of Amendment to the Registrant's
Agreement and Declaration of Trust is
filed herein as Exhibit 1(n).
(o) Form of Certificate of Designation for
Janus Money Market Fund, Janus
Government Money Market Fund and Janus
Tax-Exempt Money Market Fund is filed
herein as Exhibit 1(o).
(p) Form of Certificate of Designation for
Janus High-Yield Fund and Janus Olympus
Fund is incorporated herein by reference
to Exhibit 1(p) to Post-Effective
Amendment No. 68.
(q) Certificate of Designation for Janus
Equity Income Fund is incorporated
herein by reference to Exhibit 1(q) to
Post-Effective Amendment No. 72.
(r) Form of Certificate of Establishment and
Designation for Janus Special Situations
Fund is incorporated herein by reference
to Exhibit 1(r) to Post-Effective
Amendment No. 75.
(s) Form of Amendment to Registrant's
Agreement and Declaration of Trust is
incorporated herein by reference to
Exhibit 1(s) to Post-Effective Amendment
No. 75.
Exhibit 2 (a) Restated Bylaws are incorporated herein
by reference to Exhibit 2(a) to
Post-Effective Amendment No. 71.
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(b) First Amendment to the Bylaws is
incorporated herein by reference to
Exhibit 2(b) to Post-Effective Amendment
No. 71.
Exhibit 3 Not Applicable.
Exhibit 4 (a) Specimen Stock Certificate for Janus
Fund(1) is incorporated herein by
reference to Exhibit 4(b) to
Post-Effective Amendment No. 79.
(b) Specimen Stock Certificate for Janus
Growth and Income Fund is incorporated
herein by reference to Exhibit 4(b) to
Post-Effective Amendment No. 79.
(c) Specimen Stock Certificate for Janus
Worldwide Fund is incorporated herein by
reference to Exhibit 4(c) to Post-
Effective Amendment No. 79.
(d) Specimen Stock Certificate for Janus
Twenty Fund(1) is incorporated herein by
reference to Exhibit 4(d) to Post-
Effective Amendment No. 80.
(e) Specimen Stock Certificate for Janus
Flexible Income Fund(1) is incorporated
herein by reference to Exhibit 4(e) to
Post-Effective Amendment No. 80.
(f) Specimen Stock Certificate for Janus
Intermediate Government Securities
Fund(1) is hereby withdrawn.
(g) Specimen Stock Certificate for Janus
Venture Fund(1) is incorporated herein
by reference to Exhibit 4(g) to Post-
Effective Amendment No. 80.
(h) Specimen Stock Certificate for Janus
Enterprise Fund is incorporated herein
by reference to Exhibit 4(h) to Post-
Effective Amendment No. 80.
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(1) Outstanding certificates representing shares of predecessor entity to this
series of the Trust are deemed to represent shares of this series.
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(i) Specimen Stock Certificate for Janus
Balanced Fund is incorporated herein by
reference to Exhibit 4(i) to Post-
Effective Amendment No. 80.
(j) Specimen Stock Certificate for Janus
Short-Term Bond Fund is incorporated
herein by reference to Exhibit 4(j) to
Post-Effective Amendment No. 80.
(k) Specimen Stock Certificate for Janus
Federal Tax-Exempt Fund is filed herein
as Exhibit 4(k).
(l) Specimen Stock Certificate for Janus
Mercury Fund is filed herein as Exhibit
4(l).
(m) Specimen Stock Certificate for Janus
Overseas Fund is filed herein as Exhibit
4(m).
(n) Revised Specimen Stock Certificates for
Janus High-Yield Fund and Janus Olympus
Fund are incorporated herein by
reference to Exhibit 4(n) to
Post-Effective Amendment No. 79.
(o) Revised Specimen Stock Certificate for
Janus Equity Income Fund is incorporated
herein by reference to Exhibit 4(o) to
Post-Effective Amendment No. 79.
(p) Revised Specimen Stock Certificate for
Janus Special Situations Fund is
incorporated herein by reference to
Exhibit 4(p) to Post-Effective Amendment
No. 79.
Exhibit 5 (a) Restated form of Investment Advisory
Agreement for Janus Fund is incorporated
herein by reference to Exhibit 5(a) to
Post-Effective Amendment No. 79.
(b) Restated form of Investment Advisory
Agreement for Janus Growth and Income
Fund and Janus Worldwide Fund is
incorporated herein by reference to
Exhibit 5(b) to Post-Effective Amendment
No. 79.
(c) Restated form of Investment Advisory
Agreement for Janus Twenty Fund and
Janus Venture Fund is incorporated
herein by reference to Exhibit 5(c) to
Post-Effective Amendment No. 79.
(d) Restated form of Investment Advisory
Agreement for Janus Flexible Income Fund
is incorporated herein by reference to
Exhibit 5(d) to Post-Effective Amendment
No. 79.
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(e) Restated form of Investment Advisory
Agreement for Janus Enterprise Fund,
Janus Balanced Fund and Janus Short-
Term Bond Fund is incorporated herein by
reference to Exhibit 5(e) to
Post-Effective Amendment No. 79.
(f) Restated form of Investment Advisory
Agreement for Janus Federal Tax-Exempt
Fund and Janus Mercury Fund is
incorporated herein by reference to
Exhibit 5(f) to Post-Effective Amendment
No. 79.
(g) Restated form of Investment Advisory
Agreement for Janus Overseas Fund is
incorporated herein by reference to
Exhibit 5(g) to Post-Effective Amendment
No. 79.
(h) Form of Investment Advisory Agreement
for Janus Money Market Fund, Janus
Government Money Market Fund and Janus
Tax-Exempt Money Market Fund is
incorporated herein by reference to
Exhibit 5(h) to Post-Effective Amendment
No. 64.
(i) Restated form of Investment Advisory
Agreement for Janus High-Yield Fund is
incorporated herein by reference to
Exhibit 5(i) to Post-Effective Amendment
No. 79.
(j) Restated form of Investment Advisory
Agreement for Janus Olympus Fund is
incorporated herein by reference to
Exhibit 5(j) to Post-Effective Amendment
No. 79.
(k) Form of Investment Advisory Agreement
for Janus Equity Income Fund is
incorporated herein by reference to
Exhibit 5(k) to Post-Effective Amendment
No. 73.
(l) Form of Investment Advisory Agreement
for Janus Special Situations Fund is
incorporated herein by reference to
Exhibit 5(l) to Post-Effective Amendment
No. 75.
Exhibit 6 Form of Distribution Agreement between
Janus Investment Fund and Janus
Distributors, Inc. is incorporated
herein by reference to Exhibit 6 to
Post-Effective Amendment No. 57.
Exhibit 7 Not Applicable.
Exhibit 8 (a) Custodian Contract between Janus
Investment Fund and State Street Bank
and Trust Company is incorporated herein
by reference to Exhibit 8(a) to
Post-Effective Amendment No. 79.
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(b) Amendment dated April 25, 1990 of State
Street Custodian Contract is
incorporated herein by reference to
Exhibit 8(b) to Post-Effective Amendment
No. 79.
(c) Letter Agreement dated February 1, 1991
regarding State Street Custodian
Contract is incorporated herein by
reference to Exhibit 8(c) to
Post-Effective Amendment No. 79.
(d) Custodian Contract between Janus
Investment Fund and Investors Fiduciary
Trust Company filed as Exhibit 8(d) to
Post-Effective Amendment No. 79 is
hereby withdrawn.
(e) Letter Agreement dated October 9, 1992
regarding State Street Custodian
Agreement is filed herein as Exhibit
8(e).
(f) Letter Agreement dated April 28, 1993
regarding State Street Custodian
Agreement is filed herein as Exhibit
8(f).
(g) Letter Agreement dated April 4, 1994
regarding State Street Custodian
Agreement is filed herein as Exhibit
8(g).
(h) Form of Custody Agreement between Janus
Investment Fund, on behalf of Janus
Money Market Fund, Janus Government
Money Market Fund and Janus Tax-Exempt
Money Market Fund, and United Missouri
Bank, N.A. is filed herein as Exhibit
8(h).
(i) Letter Agreement dated December 12, 1995
regarding State Street Custodian
Contract is incorporated herein by
reference to Exhibit 8(i) to
Post-Effective Amendment No. 72.
(j) Amendment dated October 11, 1995 of
State Street Custodian Contract is
incorporated herein by reference to
Exhibit 8(j) to Post-Effective Amendment
No. 71.
(k) Form of Amendment dated September 10,
1996 of State Street Custodian Contract
is incorporated herein by reference to
Exhibit 8(k) to Post-Effective Amendment
No. 75.
(l) Letter Agreement dated September 10,
1996 regarding State Street Custodian
Contract is incorporated herein by
reference to Exhibit 8(l) to
Post-Effective Amendment No. 75.
(m) Form of Subcustodian Contract between
United Missouri Bank, N.A., and State
Street Bank and Trust Company is
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incorporated herein by reference to
Exhibit 8(m) to Post- Effective
Amendment No. 75.
Exhibit 9 (a) Transfer Agency Agreement with Investors
Fiduciary Trust Company filed as Exhibit
9(a) to Post-Effective Amendment No. 79
is hereby withdrawn.
(b) Subagency Agreement between Janus
Service Corporation and Investors
Fiduciary Trust Company filed as Exhibit
9(b) to Post-Effective Amendment No. 79
is hereby withdrawn.
(c) Form of Administration Agreement with
Janus Capital Corporation for Janus
Money Market Fund, Janus Government
Money Market Fund and Janus Tax-Exempt
Money Market Fund is filed herein as
Exhibit 9(c).
(d) Transfer Agency Agreement dated December
9, 1994 with Janus Service Corporation
for Janus Money Market Fund, Janus
Government Money Market Fund and Janus
Tax-Exempt Money Market Fund filed as
Exhibit 9(d) to Post-Effective Amendment
No. 64 is withdrawn.
(e) Transfer Agency Agreement dated
September 27, 1995 with Janus Service
Corporation for Janus Money Market Fund,
Janus Government Money Market Fund,
Janus Tax-Exempt Money Market Fund,
Janus High-Yield Fund and Janus Olympus
Fund is incorporated herein by reference
to Exhibit 9(e) to Post-Effective
Amendment No. 70.
(f) Letter Agreement dated December 21, 1995
regarding Janus Service Corporation
Transfer Agency Agreement is
incorporated herein by reference to
Exhibit 9(f) to Post- Effective
Amendment No. 72.
(g) Letter Agreement dated May 21, 1996
regarding Janus Service Corporation
Transfer Agency Agreement is
incorporated by reference to Exhibit
9(g) to Post-Effective Amendment No. 73.
(h) Form of Amended Administration Agreement
with Janus Capital Corporation for Janus
Money Market Fund, Janus Government
Money Market Fund, and Janus Tax-Exempt
Money Market Fund is incorporated by
reference to Exhibit 9(h) to
Post-Effective Amendment No. 77.
(i) Letter Agreement dated September 10,
1996 regarding Janus Service Corporation
Transfer Agency Agreement is
incorporated herein by reference to
Exhibit 9(i) to Post-Effective Amendment
No. 76.
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<PAGE>
Exhibit 10 (a) Opinion and Consent of Messrs. Davis,
Graham & Stubbs with respect to shares
of Janus Fund is incorporated herein by
reference to Exhibit 10 (a) to
Post-Effective Amendment No. 79.
(b) Opinion and Consent of Fund Counsel with
respect to shares of Janus Growth and
Income Fund and Janus Worldwide Fund is
incorporated herein by reference to
Exhibit 10(b) to Post-Effective
Amendment No. 79.
(c) Opinion and Consent of Fund Counsel with
respect to shares of Janus Enterprise
Fund, Janus Balanced Fund and Janus
Short-Term Bond Fund is incorporated
herein by reference to Exhibit 10(c) to
Post-Effective Amendment No. 80.
(d) Opinion and Consent of Messrs. Sullivan
and Worcester with respect to shares of
Janus Twenty Fund is filed herein as
Exhibit 10(d).
(e) Opinion and Consent of Messrs. Sullivan
and Worcester with respect to shares of
Janus Venture Fund is filed herein as
Exhibit 10(e).
(f) Opinion and Consent of Messrs. Sullivan
and Worcester with respect to shares of
Janus Flexible Income Fund is filed
herein as Exhibit 10(f).
(g) Opinion and Consent of Messrs. Sullivan
and Worcester with respect to shares of
Janus Intermediate Government Securities
Fund is hereby withdrawn.
(h) Opinion and Consent of Fund Counsel with
respect to shares of Janus Federal
Tax-Exempt Fund and Janus Mercury Fund
is filed herein as Exhibit 10(h).
(i) Opinion and Consent of Fund Counsel with
respect to shares of Janus Overseas Fund
is filed herein as Exhibit 10(i).
(j) Opinion and Consent of Fund Counsel with
respect to shares of Janus Money Market
Fund, Janus Government Money Market Fund
and Janus Tax-Exempt Money Market Fund
is filed herein as Exhibit 10(j).
(k) Opinion and Consent of Fund Counsel with
respect to Institutional Shares of Janus
Money Market Fund, Janus Government
Money Market Fund and Janus Tax-Exempt
Money Market Fund is filed herein as
Exhibit 10(k).
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<PAGE>
(l) Opinion and Consent of Fund Counsel with
respect to shares of Janus High-Yield
Fund and Janus Olympus Fund is
incorporated herein by reference to
Exhibit 10(l) to Post-Effective
Amendment No. 68.
(m) Opinion and Consent of Fund Counsel with
respect to shares of Janus Equity Income
Fund is incorporated herein by reference
to Exhibit 10(m) to Post-Effective
Amendment No. 72.
(n) Opinion and Consent of Fund Counsel with
respect to shares of Janus Special
Situations Fund is incorporated herein
by reference to Exhibit 10(n) to
Post-Effective Amendment No. 75.
(o) Opinion and Consent of Fund Counsel with
respect to shares of Janus Money Market
Fund, Janus Government Money Market
Fund, and Janus Tax-Exempt Money Market
Fund is incorporated herein by reference
to Exhibit 10(o) to Post-Effective
Amendment No. 76.
Exhibit 11 Consent of Price Waterhouse LLP is filed
herein as Exhibit 11.
Exhibit 12 Not Applicable.
Exhibit 13 Not Applicable.
Exhibit 14 (a) Model Individual Retirement Plan is
filed herein as Exhibit 14(a).
(b) Model Defined Contribution Retirement
Plan is incorporated herein by reference
to Exhibit 14(b) to Post-Effective
Amendment No. 41.
(c) Model Section 403(b)(7) Plan is filed
herein as Exhibit 14(c).
Exhibit 15 Not Applicable.
Exhibit 16 (a) Computation of Total Return is
incorporated herein by reference as
Exhibit 16(a) to Post-Effective
Amendment No. 80.
(b) Computation of Current Yield and
Effective Yield is incorporated herein
by reference to Exhibit 16(b) to Post-
Effective Amendment No. 67.
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<PAGE>
Exhibit 17 Powers of Attorney dated as of May 20,
1997, are filed herein as Exhibit 17.
Exhibit 18 (a) Form of plan entered into by Janus Money
Market Fund, Janus Government Money
Market Fund and Janus Tax- Exempt Money
Market Fund pursuant to Rule 18f-3
setting forth the separate arrangement
and expense allocation of each class of
such Funds filed as Exhibit 18 to
Post-Effective Amendment No. 66 is
withdrawn.
(b) Restated form of Rule 18f-3 Plan entered
into by Janus Money Market Fund, Janus
Government Money Market Fund and Janus
Tax-Exempt Money Market Fund is
incorporated herein by reference to
Exhibit 18(b) to Post-Effective
Amendment No. 69.
(c) Amended and Restated form of Rule 18f-3
Plan entered into by Janus Money Market
Fund, Janus Government Money Market
Fund, and Janus Tax-Exempt Money Market
Fund is incorporated herein by reference
to Exhibit 18(c) to Post-Effective
Amendment No. 78.
Exhibit 27 Financial Data Schedule for Janus
Special Situations Fund is filed herein
as Exhibit 27.
ITEM 25. Persons Controlled by or Under Common Control with Registrant
None
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<PAGE>
ITEM 26. Number of Holders of Securities
The number of record holders of shares of the Registrant as of June 3,
1997, was as follows:
Number of
Title of Class Record Holders
Janus Fund shares 797,477
Janus Growth and Income Fund shares 113,590
Janus Worldwide Fund shares 340,728
Janus Overseas Fund shares 101,511
Janus Twenty Fund shares 344,645
Janus Flexible Income Fund shares 29,454
Janus Venture Fund shares 103,146
Janus Enterprise Fund shares 76,504
Janus Balanced Fund shares 24,396
Janus Short-Term Bond Fund shares 4,674
Janus Federal Tax-Exempt Fund shares 3,902
Janus Mercury Fund shares 205,634
Janus Money Market Fund - Investor Shares 77,022
Janus Money Market Fund - Institutional Shares 59
Janus Money Market Fund - Service Shares 1
Janus Government Money
Market Fund - Investor Shares 11,006
Janus Government Money
Market Fund - Institutional Shares 7
Janus Government Money
Market Fund - Service Shares 2
Janus Tax-Exempt Money
Market Fund - Investor Shares 5,483
Janus Tax-Exempt Money
Market Fund - Institutional Shares 7
Janus Tax-Exempt Money
Market Fund - Service Shares 1
Janus High-Yield Fund shares 8,904
Janus Olympus Fund shares 48,686
Janus Equity Income Fund shares 5,204
Janus Special Situations Fund shares 16,322
ITEM 27. Indemnification
Article VIII of Janus Investment Fund's Agreement and Declaration of Trust
provides for indemnification of certain persons acting on behalf of the Funds.
In general, Trustees and officers will be indemnified against liability and
against all expenses of litigation incurred by them in connection with any
claim, action, suit or proceeding (or settlement of the same) in which they
become involved by virtue of their Fund office, unless their conduct is
determined to constitute willful misfeasance, bad faith, gross negligence or
reckless disregard of their duties, or unless it has been determined that they
have not acted in good faith in the reasonable belief that their actions were in
or not opposed to the best interests of the Funds. A determination that a person
covered by the indemnification provisions is entitled to indemnification may be
made by the court or other body before which the proceeding is brought, or by
either a vote of a majority of a quorum of Trustees who are neither "interested
persons" of the Trust nor parties to the proceeding or by an independent legal
counsel in a written opinion. The Funds also may advance money for these
expenses, provided that the Trustee or officer undertakes to repay the Funds if
his conduct is later determined to preclude indemnification, and that either he
provide security for the undertaking, the Trust be insured against losses
resulting from lawful advances or a majority of
C-11
<PAGE>
a quorum of disinterested Trustees, or independent counsel in a written opinion,
determines that he ultimately will be found to be entitled to indemnification.
The Trust also maintains a liability insurance policy covering its Trustees and
officers.
ITEM 28. Business and Other Connections of Investment Adviser
The only business of Janus Capital Corporation is to serve as the
investment adviser of the Registrant and as investment adviser or subadviser to
several other mutual funds and private and retirement accounts. Business
backgrounds of the principal executive officers and directors of the adviser
that also hold positions with the Registrant are included under "Officers and
Trustees" in the currently effective Statements of Additional Information of the
Registrant. The remaining principal executive officers of the investment adviser
and their positions with the adviser and affiliated entities are: Mark B.
Whiston, Vice President and Chief Marketing Officer of Janus Capital
Corporation, Director and President of Janus Capital International Ltd.;
Marjorie G. Hurd, Vice President of Janus Capital Corporation, Director and
President of Janus Service Corporation; and Stephen L. Stieneker, Assistant
General Counsel, Chief Compliance Officer and Vice President of Compliance of
Janus Capital Corporation. Mr. Michael E. Herman, a director of Janus Capital
Corporation, is Chairman of the Finance Committee (1990 to present) of Ewing
Marion Kauffman Foundation, 4900 Oak, Kansas City, Missouri 64112. Mr. Michael
N. Stolper, a director of Janus Capital Corporation, is President of Stolper &
Company, Inc., 525 "B" Street, Suite 1080, San Diego, California 92101, an
investment performance consultant. Mr. Thomas A. McDonnell, a director of Janus
Capital Corporation, is President, Chief Executive Officer and a Director of DST
Systems, Inc., 1055 Broadway, 9th Floor, Kansas City, Missouri 64105, provider
of data processing and recordkeeping services for various mutual funds, and is
Executive Vice President and a director of Kansas City Southern Industries,
Inc., 114 W. 11th Street, Kansas City, Missouri 64105, a publicly traded holding
company whose primary subsidiaries are engaged in transportation, information
processing and financial services. Mr. Landon H. Rowland, a director of Janus
Capital Corporation, is President and Chief Executive Officer of Kansas City
Southern Industries, Inc.
ITEM 29. Principal Underwriters
(a) Janus Distributors, Inc. ("Janus Distributors") serves as a
principal underwriter for the Registrant and the Retirement
Shares of Janus Aspen Series only.
(b) The principal business address, positions with Janus Distributors
and positions with Registrant of Steven R. Goodbarn, officer and
director of Janus Distributors, are described under "Officers and
Trustees" in the Statement of Additional Information included in
this Registration Statement. The remaining principal executive
officers of Janus Distributors are Kelley Abbott Howes,
President, and Jennifer A. Davis, Secretary. Ms. Howes's position
with the Registrant is described under "Officers and Trustees" in
the Statement of Additional Information. Ms. Davis does not hold
any positions with the Registrant. The principal business address
of each person is 100 Fillmore Street, Denver, Colorado
80206-4928.
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<PAGE>
(c) Not applicable.
ITEM 30. Location of Accounts and Records
The accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the rules promulgated
thereunder are maintained by Janus Capital Corporation and Janus Service
Corporation, both of which are located at 100 Fillmore Street, Denver, Colorado
80206-4928, and by State Street Bank and Trust Company, P.O. Box 351, Boston,
Massachusetts 02101, and United Missouri Bank, P.O. Box 419226, Kansas City,
Missouri 64141-6226.
ITEM 31. Management Services
The Registrant has no management-related service contract which is not
discussed in Part A or Part B of this form.
ITEM 32. Undertakings
(a) Not applicable.
(b) Not applicable.
(c) The Registrant undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest
annual report to shareholders, upon request and without charge.
C-13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Amendment to its Registration
Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly
caused this Amendment to its Registration Statement to be signed on its behalf
by the undersigned, thereto duly authorized, in the City of Denver, and State of
Colorado, on the 26th day of June, 1997.
JANUS INVESTMENT FUND
By: /s/ Steven R. Goodbarn
Steven R. Goodbarn
Vice President and Chief Financial Officer
(Principal Financial Officer)
Janus Investment Fund is organized under the Agreement and Declaration of
Trust of the Registrant dated February 11, 1986, a copy of which is on file with
the Secretary of State of The Commonwealth of Massachusetts. The obligations of
the Registrant hereunder are not binding upon any of the Trustees, shareholders,
nominees, officers, agents or employees of the Registrant personally, but bind
only the trust property of the Registrant, as provided in the Agreement and
Declaration of Trust of the Registrant. The execution of this Amendment to the
Registration Statement has been authorized by the Trustees of the Registrant and
this Amendment to the Registration Statement has been signed by an authorized
officer of the Registrant, acting as such, and neither such authorization by
such Trustees nor such execution by such officer shall be deemed to have been
made by any of them personally, but shall bind only the trust property of the
Registrant as provided in its Declaration of Trust.
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signature Title Date
Thomas H. Bailey* President June 26, 1997
Thomas H. Bailey (Principal Executive
Officer) and Trustee
/s/ Glenn P. O'Flaherty Treasurer and Chief June 26, 1997
Glenn P. O'Flaherty Accounting Officer
(Principal Accounting
Officer)
<PAGE>
/s/ James P. Craig, III Trustee June 26, 1997
James P. Craig, III
Gary O. Loo* Trustee June 26, 1997
Gary O. Loo
Dennis B. Mullen* Trustee June 26, 1997
Dennis B. Mullen
James T. Rothe* Trustee June 26, 1997
James T. Rothe
William D. Stewart* Trustee June 26, 1997
William D. Stewart
Martin H. Waldinger* Trustee June 26, 1997
Martin H. Waldinger
/s/ Steven R. Goodbarn
*By Steven R. Goodbarn
Attorney-in-Fact
<PAGE>
INDEX OF EXHIBITS
Exhibit 1(k) Certificate of Designation for Janus Federal
Tax-Exempt Fund
Exhibit 1(l) Certificate of Designation for Janus Mercury Fund
Exhibit 1(m) Certificate of Designation for Janus Overseas Fund
Exhibit 1(n) Form of Amendment to the Registrant's Agreement
and Declaration of Trust
Exhibit 1(o) Form of Certificate of Designation for Janus Money
Market Fund, Janus Government Money Market Fund
and Janus Tax-Exempt Money Market Fund
Exhibit 4(k) Specimen Stock Certificate for Janus Federal
Tax-Exempt Fund
Exhibit 4(l) Specimen Stock Certificate for Janus Mercury Fund
Exhibit 4(m) Specimen Stock Certificate for Janus Overseas Fund
Exhibit 8(e) Letter Agreement dated October 9, 1992
Exhibit 8(f) Letter Agreement dated April 28, 1993
Exhibit 8(g) Letter Agreement dated April 4, 1994
Exhibit 8(h) Form of Custody Agreement between Janus Investment
Fund on behalf of Janus Money Market Fund, Janus
Government Money Market Fund and Janus Tax-Exempt
Money Market Fund and United Missouri Bank, N.A.
Exhibit 9(c) Form of Administration Agreement with Janus
Capital Corporation for Janus Money Market Fund,
Janus Government Money Market Fund and Janus
Tax-Exempt Money Market Fund
Exhibit 10(d) Opinion and Consent of Fund Counsel for Janus
Twenty Fund
Exhibit 10(e) Opinion and Consent of Fund Counsel for Janus
Venture Fund
<PAGE>
Exhibit 10(f) Opinion and Consent of Fund Counsel for Janus
Flexible Income Fund
Exhibit 10(h) Opinion and Consent of Fund Counsel for Janus
Federal Tax-Exempt Fund and Janus Mercury Fund
Exhibit 10(i) Opinion and Consent of Fund Counsel for Janus
Overseas Fund
Exhibit 10(j) Opinion and Consent of Fund Counsel for Janus
Money Market Fund, Janus Government Money Market
Fund and Janus Tax-Exempt Money Market Fund
Exhibit 10(k) Opinion and Consent of Fund Counsel for
Institutional Shares of Janus Money Market Fund,
Janus Government Money Market Fund and Janus
Tax-Exempt Money Market Fund
Exhibit 11 Consent of Price Waterhouse
Exhibit 14(a) Model Individual Retirement Plan
Exhibit 14(c) Model Section 403(b)(7) Plan
Exhibit 17 Powers of Attorney
Exhibit 27 Financial Data Schedule
EXHIBIT 1(k)
JANUS INVESTMENT FUND
CERTIFICATE OF DESIGNATION
FOR
JANUS FEDERAL TAX-EXEMPT FUND
The undersigned, being the Secretary of Janus Investment Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that,
pursuant to the authority conferred upon the Trustees of the Trust by Section
6.1(b) and Section 9.3 of the Agreement and Declaration of Trust, dated February
11, 1986, and all amendments thereto, (hereinafter referred to as the
"Declaration of Trust"), and by the affirmative vote of a Majority of the
Trustees at a meeting duly called and held on December 1, 1992, the Declaration
of Trust is amended as follows:
There is hereby established and designated the Janus Federal Tax-Exempt
Fund (hereinafter referred to as the "Tax-Exempt Fund"). The beneficial interest
in the Tax-Exempt Fund shall be divided into Shares having a nominal or par
value of one cent ($.01) per Share, of which an unlimited number may be issued,
which Shares shall represent interests only in the Tax-Exempt Fund. The Shares
of the Tax-Exempt Fund shall have the following rights and preferences:
(a) Assets Belonging to the Tax-Exempt Fund. Any portion of the Trust
Property allocated to the Tax-Exempt Fund, and all consideration received
by the Trust for the issue or sale of Shares of the Tax-Exempt Fund,
together with all assets in which such consideration is invested or
reinvested, all interest, dividends, income, earnings, profits and gains
therefrom, and proceeds thereof, including any proceeds derived from the
sale, exchange or liquidation of such assets, and any funds or payments
derived from any reinvestment of such proceeds in whatever form the same
may be, shall be held by the Trustees in trust for the benefit of the
holders of Shares of the Tax-Exempt Fund and shall irrevocably belong to
the Tax-Exempt Fund for all purposes, and shall be so recorded upon the
books of account of the Trust, and the Shareholders of any other Fund who
are not Shareholders of the Tax-Exempt Fund shall not have, and shall be
conclusively deemed to have waived, any claims to
1
<PAGE>
Certificate of Designation
Janus Federal Tax-Exempt Fund
the assets of the Tax-Exempt Fund. Such consideration, assets, interest,
dividends, income, earnings, profits, gains and proceeds, together with any
General Items allocated to the Tax-Exempt Fund as provided in the following
sentence, are herein referred to collectively as "Fund Assets" of the
Tax-Exempt Fund, and as assets "belonging to" the Tax-Exempt Fund. In the
event that there are any assets, income, earnings, profits, and proceeds
thereof, funds, or payments which are not readily identifiable as belonging
to any particular Fund (collectively "General Items"), the Trustees shall
allocate such General Items to and among any one or more of the Funds
established and designated from time to time in such manner and on such
basis as they, in their sole discretion, deem fair and equitable; and any
General Items so allocated to the Tax-Exempt Fund shall belong to and be
part of the Fund Assets of the Tax-Exempt Fund. Each such allocation by the
Trustees shall be conclusive and binding upon the Shareholders of all the
Funds for all purposes.
(b) Liabilities of the Tax-Exempt Fund. The assets belonging to the
Tax-Exempt Fund shall be charged with the liabilities in respect of the
Tax-Exempt Fund and all expenses, costs, charges and reserves attributable
to the Tax-Exempt Fund, and any general liabilities, expenses, costs,
charges or reserves of the Trust which are not readily identifiable as
pertaining to any particular Fund shall be allocated and charged by the
Trustees to and among any one or more of the Funds established and
designated from time to time in such manner and on such basis as the
Trustees in their sole discretion deem fair and equitable. The
indebtedness, expenses, costs, charges and reserves allocated and so
charged to the Tax-Exempt Fund are herein referred to as "liabilities of"
the Tax-Exempt Fund. Each allocation of liabilities, expenses, costs,
charges and reserves by the Trustees shall be conclusive and binding upon
the Shareholders of all the Funds for all purposes. Any creditor of the
Tax-Exempt Fund may look only to the assets of the Tax-Exempt Fund to
satisfy such creditor's debt.
(c) Dividends. Dividends and distributions on Shares of the Tax-Exempt
Fund may be paid with such frequency as the Trustees may determine, which
may be daily or otherwise pursuant to a standing resolution or resolutions
adopted only once or with such frequency as the Trustees may determine, to
the Shareholders of the Tax-Exempt Fund, from
2
<PAGE>
Certificate of Designation
Janus Federal Tax-Exempt Fund
such of the income, accrued or realized, and capital gains, realized or
unrealized, and out of the assets belonging to the Tax-Exempt Fund, as the
Trustees may determine, after providing for actual and accrued liabilities
of the Tax-Exempt Fund. All dividends and distributions on Shares of the
Tax-Exempt Fund shall be distributed pro rata to the Shareholders of the
Tax-Exempt Fund in proportion to the number of such Shares held by such
holders at the date and time of record established for the payment of such
dividends or distributions, except that in connection with any dividend or
distribution program or procedure the Trustees may determine that no
dividend or distribution shall be payable on Shares as to which the
Shareholder's purchase order and/or payment have not been received by the
time or times established by the Trustees under such program or procedure,
or that dividends or distributions shall be payable on Shares which have
been tendered by the holder thereof for redemption or repurchase, but the
redemption or repurchase proceeds of which have not yet been paid to such
Shareholder. Such dividends and distributions may be made in cash or Shares
of the Tax-Exempt Fund or a combination thereof as determined by the
Trustees, or pursuant to any program that the Trustees may have in effect
at the time for the election by each Shareholder of the mode of the making
of such dividend or distribution to that Shareholder. Any such dividend or
distribution paid in Shares will be paid at the net asset value thereof as
determined in accordance with subsection (h) hereof.
(d) Liquidation. In the event of the liquidation or dissolution of the
Trust, the Shareholders of the Tax-Exempt Fund shall be entitled to
receive, when and as declared by the Trustees, the excess of the Fund
Assets over the liabilities of the Tax-Exempt Fund. The assets so
distributable to the Shareholders of the Tax-Exempt Fund shall be
distributed among such Shareholders in proportion to the number of Shares
of the Tax-Exempt Fund held by them and recorded on the books of the Trust.
The liquidation of the Tax-Exempt Fund may be authorized by vote of a
Majority of the Trustees, subject to the affirmative vote of "a majority of
the outstanding voting securities" of the Tax-Exempt Fund, as the quoted
phrase is defined in the 1940 Act, determined in accordance with clause
(iii) of the definition of "Majority Shareholder Vote" in Section 1.4 of
the Declaration of Trust.
(e) Voting. The Shareholders shall have the voting rights set forth in
or determined under Article 7 of the Declaration of Trust.
3
<PAGE>
Certificate of Designation
Janus Federal Tax-Exempt Fund
(f) Redemption by Shareholder. Each holder of Shares of the Tax-Exempt
Fund shall have the right at such times as may be permitted by the Trust,
but no less frequently than once each week, to require the Trust to redeem
all or any part of his Shares of the Tax-Exempt Fund at a redemption price
equal to the net asset value per Share of the Tax-Exempt Fund next
determined in accordance with subsection (h) hereof after the Shares are
properly tendered for redemption; provided, that the Trustees may from time
to time, in their discretion, determine and impose a fee for such
redemption. Payment of the redemption price shall be in cash; provided,
however, that if the Trustees determine, which determination shall be
conclusive, that conditions exist which make payment wholly in cash unwise
or undesirable, the Trust may make payment wholly or partly in Securities
or other assets belonging to the Tax-Exempt Fund at the value of such
Securities or assets used in such determination of net asset value.
Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the holders of Shares of the
Tax-Exempt Fund to require the Trust to redeem Shares of the Tax-Exempt
Fund during any period or at any time when and to the extent permissible
under the 1940 Act.
(g) Redemption at the Option of the Trust. Each Share of the
Tax-Exempt Fund shall be subject to redemption at the option of the Trust
at the redemption price which would be applicable if such Share were then
being redeemed by the Shareholder pursuant to subsection (f) hereof: (i) at
any time, if the Trustees determine in their sole discretion that failure
to so redeem may have materially adverse consequences to the holders of the
Shares of the Trust or of any Fund, or (ii) upon such other conditions with
respect to maintenance of Shareholder accounts of a minimum amount as may
from time to time be determined by the Trustees and set forth in the then
current Prospectus of the Tax-Exempt Fund. Upon such redemption the holders
of the Shares so redeemed shall have no further right with respect thereto
other than to receive payment of such redemption price.
(h) Net Asset Value. The net asset value per Share of the Tax-Exempt
Fund at any time shall be the quotient obtained by dividing the value of
the net assets of the Tax-Exempt Fund at such time (being the current value
of the assets belonging to the Tax-Exempt Fund, less its then existing
liabilities) by the total number of Shares of the Tax-Exempt Fund then
outstanding, all determined in accordance with the methods and procedures,
including without limitation those with respect to rounding, established by
the Trustees from time to time. The Trustees
4
<PAGE>
Certificate of Designation
Janus Federal Tax-Exempt Fund
may determine to maintain the net asset value per Share of the Tax-Exempt
Fund at a designated constant dollar amount and in connection therewith may
adopt procedures not inconsistent with the 1940 Act for the continuing
declaration of income attributable to the Tax-Exempt Fund as dividends
payable in additional Shares of the Tax-Exempt Fund at the designated
constant dollar amount and for the handling of any losses attributable to
the Tax-Exempt Fund. Such procedures may provide that in the event of any
loss each Shareholder shall be deemed to have contributed to the shares of
beneficial interest account of the Tax-Exempt Fund his pro rata portion of
the total number of Shares required to be canceled in order to permit the
net asset value per share of the Tax-Exempt Fund to be maintained, after
reflecting such loss, at the designated constant dollar amount. Each
Shareholder of the Tax-Exempt Fund shall be deemed to have expressly
agreed, by his investment in the Tax-Exempt Fund, to make the contribution
referred to in the preceding sentence in the event of any such loss.
(i) Transfer. All Shares of the Tax-Exempt Fund shall be transferable,
but transfers of Shares of the Tax-Exempt Fund will be recorded on the
Share transfer records of the Trust applicable to the Tax-Exempt Fund only
at such times as Shareholders shall have the right to require the Trust to
redeem Shares of the Tax-Exempt Fund and at such other times as may be
permitted by the Trustees.
(j) Equality. All Shares of the Tax-Exempt Fund shall represent an
equal proportionate interest in the assets belonging to the Tax-Exempt Fund
(subject to the liabilities of the Tax-Exempt Fund), and each Share of the
Tax-Exempt Fund shall be equal to each other Share thereof; but the
provisions of this sentence shall not restrict any distinctions permissible
under subsection (c) hereof that may exist with respect to dividends and
distributions on Shares of the Tax-Exempt Fund. The Trustees may from time
to time divide or combine the Shares of the Tax-Exempt Fund into a greater
or lesser number of Shares of the Tax-Exempt Fund without thereby changing
the proportionate beneficial interest in the assets belonging to the
Tax-Exempt Fund or in any way affecting the rights of the holders of Shares
of any other Fund.
(k) Rights of Fractional Shares. Any fractional Share of the
Tax-Exempt Fund shall carry proportionately all the
5
<PAGE>
Certificate of Designation
Janus Federal Tax-Exempt Fund
rights and obligations of a whole Share of the Tax-Exempt Fund, including
rights and obligations with respect to voting, receipt of dividends and
distributions, redemption of Shares, and liquidation of the Trust or of the
Tax-Exempt Fund.
(l) Conversion Rights. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Tax-Exempt Fund shall have the right to convert said
Shares into Shares of one or more other Funds in accordance with such
requirements and procedures as the Trustees may establish.
(m) Amendment, etc. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument in writing
signed by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), provided that, if any
amendment adversely affects the rights of the Shareholders of the
Tax-Exempt Fund, such amendment may be adopted by an instrument in writing
signed by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees) when authorized to do
so by the vote in accordance with Section 7.1 of the Declaration of Trust
of the holders of a majority of all the Shares of the Tax-Exempt Fund
outstanding and entitled to vote.
(n) Incorporation of Defined Terms. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filed with the Secretary of State of the
Commonwealth of Massachusetts.
The Trustees further direct that, upon the execution of this Certificate of
Designation, the Trust take all necessary action to file a copy of this
Certificate of Designation with the Secretary of State of The Commonwealth of
Massachusetts and at any other place required by law or by the Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set her hand and seal this 11th day
of February, 1993.
/s/ Janice M. Teague
Janice M. Teague, Secretary
6
EXHIBIT 1(l)
JANUS INVESTMENT FUND
CERTIFICATE OF DESIGNATION
FOR
JANUS MERCURY FUND
The undersigned, being the Secretary of Janus Investment Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that,
pursuant to the authority conferred upon the Trustees of the Trust by Section
6.1(b) and Section 9.3 of the Agreement and Declaration of Trust, dated February
11, 1986, and all amendments thereto, (hereinafter referred to as the
"Declaration of Trust"), and by the affirmative vote of a Majority of the
Trustees at a meeting duly called and held on December 1, 1992, the Declaration
of Trust is amended as follows:
There is hereby established and designated the Janus Mercury Fund
(hereinafter referred to as the "Mercury Fund"). The beneficial interest in the
Mercury Fund shall be divided into Shares having a nominal or par value of one
cent ($.01) per Share, of which an unlimited number may be issued, which Shares
shall represent interests only in the Mercury Fund. The Shares of the Mercury
Fund shall have the following rights and preferences:
(a) Assets Belonging to the Mercury Fund. Any portion of the Trust
Property allocated to the Mercury Fund, and all consideration received by
the Trust for the issue or sale of Shares of the Mercury Fund, together
with all assets in which such consideration is invested or reinvested, all
interest, dividends, income, earnings, profits and gains therefrom, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall be
held by the Trustees in trust for the benefit of the holders of Shares of
the Mercury Fund and shall irrevocably belong to the Mercury Fund for all
purposes, and shall be so recorded upon the books of account of the Trust,
and the Shareholders of any other Fund who are not Shareholders of the
Mercury Fund shall not have, and shall be conclusively deemed to have
waived, any claims to the assets of the Mercury Fund. Such consideration,
assets, interest, dividends, income, earnings, profits, gains and proceeds,
together with any General Items allocated to the Mercury Fund as provided
in the following sentence, are herein referred to collectively as "Fund
Assets" of the
1
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Certificate of Designation
Janus Mercury Fund
Mercury Fund, and as assets "belonging to" the Mercury Fund. In the event
that there are any assets, income, earnings, profits, and proceeds thereof,
funds, or payments which are not readily identifiable as belonging to any
particular Fund (collectively "General Items"), the Trustees shall allocate
such General Items to and among any one or more of the Funds established
and designated from time to time in such manner and on such basis as they,
in their sole discretion, deem fair and equitable; and any General Items so
allocated to the Mercury Fund shall belong to and be part of the Fund
Assets of the Mercury Fund. Each such allocation by the Trustees shall be
conclusive and binding upon the Shareholders of all the Funds for all
purposes.
(b) Liabilities of the Mercury Fund. The assets belonging to the
Mercury Fund shall be charged with the liabilities in respect of the
Mercury Fund and all expenses, costs, charges and reserves attributable to
the Mercury Fund, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining to
any particular Fund shall be allocated and charged by the Trustees to and
among any one or more of the Funds established and designated from time to
time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The indebtedness, expenses, costs,
charges and reserves allocated and so charged to the Mercury Fund are
herein referred to as "liabilities of" the Mercury Fund. Each allocation of
liabilities, expenses, costs, charges and reserves by the Trustees shall be
conclusive and binding upon the Shareholders of all the Funds for all
purposes. Any creditor of the Mercury Fund may look only to the assets of
the Mercury Fund to satisfy such creditor's debt.
(c) Dividends. Dividends and distributions on Shares of the Mercury
Fund may be paid with such frequency as the Trustees may determine, which
may be daily or otherwise pursuant to a standing resolution or resolutions
adopted only once or with such frequency as the Trustees may determine, to
the Shareholders of the Mercury Fund, from such of the income, accrued or
realized, and capital gains, realized or unrealized, and out of the assets
belonging to the Mercury Fund, as the Trustees may determine, after
providing for actual and accrued liabilities of the Mercury Fund. All
dividends and distributions on Shares of the Mercury Fund shall be
distributed pro rata to the Shareholders of the Mercury Fund in proportion
to the number
2
<PAGE>
Certificate of Designation
Janus Mercury Fund
of such Shares held by such holders at the date and time of record
established for the payment of such dividends or distributions, except that
in connection with any dividend or distribution program or procedure the
Trustees may determine that no dividend or distribution shall be payable on
Shares as to which the Shareholder's purchase order and/or payment have not
been received by the time or times established by the Trustees under such
program or procedure, or that dividends or distributions shall be payable
on Shares which have been tendered by the holder thereof for redemption or
repurchase, but the redemption or repurchase proceeds of which have not yet
been paid to such Shareholder. Such dividends and distributions may be made
in cash or Shares of the Mercury Fund or a combination thereof as
determined by the Trustees, or pursuant to any program that the Trustees
may have in effect at the time for the election by each Shareholder of the
mode of the making of such dividend or distribution to that Shareholder.
Any such dividend or distribution paid in Shares will be paid at the net
asset value thereof as determined in accordance with subsection (h) hereof.
(d) Liquidation. In the event of the liquidation or dissolution of the
Trust, the Shareholders of the Mercury Fund shall be entitled to receive,
when and as declared by the Trustees, the excess of the Fund Assets over
the liabilities of the Mercury Fund. The assets so distributable to the
Shareholders of the Mercury Fund shall be distributed among such
Shareholders in proportion to the number of Shares of the Mercury Fund held
by them and recorded on the books of the Trust. The liquidation of the
Mercury Fund may be authorized by vote of a Majority of the Trustees,
subject to the affirmative vote of "a majority of the outstanding voting
securities" of the Mercury Fund, as the quoted phrase is defined in the
1940 Act, determined in accordance with clause (iii) of the definition of
"Majority Shareholder Vote" in Section 1.4 of the Declaration of Trust.
(e) Voting. The Shareholders shall have the voting rights set forth in
or determined under Article 7 of the Declaration of Trust.
(f) Redemption by Shareholder. Each holder of Shares of the Mercury
Fund shall have the right at such times as may be permitted by the Trust,
but no less frequently than once each week, to require the Trust to redeem
all or any
3
<PAGE>
Certificate of Designation
Janus Mercury Fund
part of his Shares of the Mercury Fund at a redemption price equal to the
net asset value per Share of the Mercury Fund next determined in accordance
with subsection (h) hereof after the Shares are properly tendered for
redemption; provided, that the Trustees may from time to time, in their
discretion, determine and impose a fee for such redemption. Payment of the
redemption price shall be in cash; provided, however, that if the Trustees
determine, which determination shall be conclusive, that conditions exist
which make payment wholly in cash unwise or undesirable, the Trust may make
payment wholly or partly in Securities or other assets belonging to the
Mercury Fund at the value of such Securities or assets used in such
determination of net asset value. Notwithstanding the foregoing, the Trust
may postpone payment of the redemption price and may suspend the right of
the holders of Shares of the Mercury Fund to require the Trust to redeem
Shares of the Mercury Fund during any period or at any time when and to the
extent permissible under the 1940 Act.
(g) Redemption at the Option of the Trust. Each Share of the Mercury
Fund shall be subject to redemption at the option of the Trust at the
redemption price which would be applicable if such Share were then being
redeemed by the Shareholder pursuant to subsection (f) hereof: (i) at any
time, if the Trustees determine in their sole discretion that failure to so
redeem may have materially adverse consequences to the holders of the
Shares of the Trust or of any Fund, or (ii) upon such other conditions with
respect to maintenance of Shareholder accounts of a minimum amount as may
from time to time be determined by the Trustees and set forth in the then
current Prospectus of the Mercury Fund. Upon such redemption the holders of
the Shares so redeemed shall have no further right with respect thereto
other than to receive payment of such redemption price.
(h) Net Asset Value. The net asset value per Share of the Mercury Fund
at any time shall be the quotient obtained by dividing the value of the net
assets of the Mercury Fund at such time (being the current value of the
assets belonging to the Mercury Fund, less its then existing liabilities)
by the total number of Shares of the Mercury Fund then outstanding, all
determined in accordance with the methods and procedures, including without
limitation those with respect to rounding, established by the Trustees from
time to time. The Trustees may determine to maintain the net asset value
per Share of the Mercury Fund at a
4
<PAGE>
Certificate of Designation
Janus Mercury Fund
designated constant dollar amount and in connection therewith may adopt
procedures not inconsistent with the 1940 Act for the continuing
declaration of income attributable to the Mercury Fund as dividends payable
in additional Shares of the Mercury Fund at the designated constant dollar
amount and for the handling of any losses attributable to the Mercury Fund.
Such procedures may provide that in the event of any loss each Shareholder
shall be deemed to have contributed to the shares of beneficial interest
account of the Mercury Fund his pro rata portion of the total number of
Shares required to be canceled in order to permit the net asset value per
share of the Mercury Fund to be maintained, after reflecting such loss, at
the designated constant dollar amount. Each Shareholder of the Mercury Fund
shall be deemed to have expressly agreed, by his investment in the Mercury
Fund, to make the contribution referred to in the preceding sentence in the
event of any such loss.
(i) Transfer. All Shares of the Mercury Fund shall be transferable,
but transfers of Shares of the Mercury Fund will be recorded on the Share
transfer records of the Trust applicable to the Mercury Fund only at such
times as Shareholders shall have the right to require the Trust to redeem
Shares of the Mercury Fund and at such other times as may be permitted by
the Trustees.
(j) Equality. All Shares of the Mercury Fund shall represent an equal
proportionate interest in the assets belonging to the Mercury Fund (subject
to the liabilities of the Mercury Fund), and each Share of the Mercury Fund
shall be equal to each other Share thereof; but the provisions of this
sentence shall not restrict any distinctions permissible under subsection
(c) hereof that may exist with respect to dividends and distributions on
Shares of the Mercury Fund. The Trustees may from time to time divide or
combine the Shares of the Mercury Fund into a greater or lesser number of
Shares of the Mercury Fund without thereby changing the proportionate
beneficial interest in the assets belonging to the Mercury Fund or in any
way affecting the rights of the holders of Shares of any other Fund.
(k) Rights of Fractional Shares. Any fractional Share of the Mercury
Fund shall carry proportionately all the rights and obligations of a whole
Share of the Mercury Fund, including rights and obligations with respect to
voting,
5
<PAGE>
Certificate of Designation
Janus Mercury Fund
receipt of dividends and distributions, redemption of Shares, and
liquidation of the Trust or of the Mercury Fund.
(l) Conversion Rights. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Mercury Fund shall have the right to convert said Shares
into Shares of one or more other Funds in accordance with such requirements
and procedures as the Trustees may establish.
(m) Amendment, etc. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument in writing
signed by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), provided that, if any
amendment adversely affects the rights of the Shareholders of the Mercury
Fund, such amendment may be adopted by an instrument in writing signed by a
Majority of the Trustees (or by an officer of the Trust pursuant to the
vote of a Majority of the Trustees) when authorized to do so by the vote in
accordance with Section 7.1 of the Declaration of Trust of the holders of a
majority of all the Shares of the Mercury Fund outstanding and entitled to
vote.
(n) Incorporation of Defined Terms. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filed with the Secretary of State of the
Commonwealth of Massachusetts.
The Trustees further direct that, upon the execution of this Certificate of
Designation, the Trust take all necessary action to file a copy of this
Certificate of Designation with the Secretary of State of The Commonwealth of
Massachusetts and at any other place required by law or by the Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set her hand and seal this 11th day
of February, 1993.
/s/ Janice M. Teague
Janice M. Teague, Secretary
6
EXHIBIT 1(m)
JANUS INVESTMENT FUND
CERTIFICATE OF DESIGNATION
FOR
JANUS OVERSEAS FUND
The undersigned, being the Secretary of Janus Investment Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that,
pursuant to the authority conferred upon the Trustees of the Trust by Section
6.1(b) and Section 9.3 of the Agreement and Declaration of Trust, dated February
11, 1986, and all amendments thereto, (hereinafter referred to as the
"Declaration of Trust"), and by the affirmative vote of a Majority of the
Trustees at a meeting duly called and held on December 3, 1993, the Declaration
of Trust is amended as follows:
There is hereby established and designated the Janus Overseas Fund
(hereinafter referred to as the "Overseas Fund"). The beneficial interest in the
Overseas Fund shall be divided into Shares having a nominal or par value of one
cent ($.01) per Share, of which an unlimited number may be issued, which Shares
shall represent interests only in the Overseas Fund. The Shares of the Overseas
Fund shall have the following rights and preferences:
(a) Assets Belonging to the Overseas Fund. Any portion of the Trust
Property allocated to the Overseas Fund, and all consideration received by
the Trust for the issue or sale of Shares of the Overseas Fund, together
with all assets in which such consideration is invested or reinvested, all
interest, dividends, income, earnings, profits and gains therefrom, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation of such assets, and any funds or payments derived from any
reinvestment of such proceeds in whatever form the same may be, shall be
held by the Trustees in trust for the benefit of the holders of Shares of
the Overseas Fund and shall irrevocably belong to the Overseas Fund for all
purposes, and shall be so recorded upon the books of account of the Trust,
and the Shareholders of any other Fund who are not Shareholders of the
Overseas Fund shall not have, and shall be conclusively deemed to have
waived, any claims to the assets of the Overseas Fund. Such consideration,
assets, interest, dividends, income, earnings, profits, gains and proceeds,
together with any General Items allocated to the Overseas Fund as provided
in the following sentence, are herein referred to collectively as "Fund
Assets" of the Overseas Fund, and as assets "belonging to" the Overseas
Fund. In the event that there are any assets, income, earnings, profits,
and proceeds thereof, funds, or payments which are not readily identifiable
as belonging to any particular Fund (collectively "General Items"), the
Trustees shall allocate such General Items to and among any one or more of
the Funds established and designated from time to
- 1 -
<PAGE>
Certificate of Designation
Janus Overseas Fund
time in such manner and on such basis as they, in their sole discretion,
deem fair and equitable; and any General Items so allocated to the Overseas
Fund shall belong to and be part of the Fund Assets of the Overseas Fund.
Each such allocation by the Trustees shall be conclusive and binding upon
the Shareholders of all the Funds for all purposes.
(b) Liabilities of the Overseas Fund. The assets belonging to the
Overseas Fund shall be charged with the liabilities in respect of the
Overseas Fund and all expenses, costs, charges and reserves attributable to
the Overseas Fund, and any general liabilities, expenses, costs, charges or
reserves of the Trust which are not readily identifiable as pertaining to
any particular Fund shall be allocated and charged by the Trustees to and
among any one or more of the Funds established and designated from time to
time in such manner and on such basis as the Trustees in their sole
discretion deem fair and equitable. The indebtedness, expenses, costs,
charges and reserves allocated and so charged to the Overseas Fund are
herein referred to as "liabilities of" the Overseas Fund. Each allocation
of liabilities, expenses, costs, charges and reserves by the Trustees shall
be conclusive and binding upon the Shareholders of all the Funds for all
purposes. Any creditor of the Overseas Fund may look only to the assets of
the Overseas Fund to satisfy such creditor's debt.
(c) Dividends. Dividends and distributions on Shares of the Overseas
Fund may be paid with such frequency as the Trustees may determine, which
may be daily or otherwise pursuant to a standing resolution or resolutions
adopted only once or with such frequency as the Trustees may determine, to
the Shareholders of the Overseas Fund, from such of the income, accrued or
realized, and capital gains, realized or unrealized, and out of the assets
belonging to the Overseas Fund, as the Trustees may determine, after
providing for actual and accrued liabilities of the Overseas Fund. All
dividends and distributions on Shares of the Overseas Fund shall be
distributed pro rata to the Shareholders of the Overseas Fund in proportion
to the number of such Shares held by such holders at the date and time of
record established for the payment of such dividends or distributions,
except that in connection with any dividend or distribution program or
procedure the Trustees may determine that no dividend or distribution shall
be payable on Shares as to which the Shareholder's purchase order and/or
payment have not been received by the time or times established by the
Trustees under such program or procedure, or that dividends or
distributions shall be payable on Shares which have been tendered by the
holder thereof for redemption or repurchase, but the redemption or
repurchase proceeds of which have not yet been paid to such Shareholder.
Such dividends and distributions may be made in cash or Shares of the
Overseas Fund or a combination thereof as
- 2 -
<PAGE>
Certificate of Designation
Janus Overseas Fund
determined by the Trustees, or pursuant to any program that the Trustees
may have in effect at the time for the election by each Shareholder of the
mode of the making of such dividend or distribution to that Shareholder.
Any such dividend or distribution paid in Shares will be paid at the net
asset value thereof as determined in accordance with subsection (h) hereof.
(d) Liquidation. In the event of the liquidation or dissolution of the
Trust, the Shareholders of the Overseas Fund shall be entitled to receive,
when and as declared by the Trustees, the excess of the Fund Assets over
the liabilities of the Overseas Fund. The assets so distributable to the
Shareholders of the Overseas Fund shall be distributed among such
Shareholders in proportion to the number of Shares of the Overseas Fund
held by them and recorded on the books of the Trust. The liquidation of the
Overseas Fund may be authorized by vote of a Majority of the Trustees,
subject to the affirmative vote of "a majority of the outstanding voting
securities" of the Overseas Fund, as the quoted phrase is defined in the
1940 Act, determined in accordance with clause (iii) of the definition of
"Majority Shareholder Vote" in Section 1.4 of the Declaration of Trust.
(e) Voting. The Shareholders shall have the voting rights set forth in
or determined under Article 7 of the Declaration of Trust.
(f) Redemption by Shareholder. Each holder of Shares of the Overseas
Fund shall have the right at such times as may be permitted by the Trust,
but no less frequently than once each week, to require the Trust to redeem
all or any part of his Shares of the Overseas Fund at a redemption price
equal to the net asset value per Share of the Overseas Fund next determined
in accordance with subsection (h) hereof after the Shares are properly
tendered for redemption; provided, that the Trustees may from time to time,
in their discretion, determine and impose a fee for such redemption.
Payment of the redemption price shall be in cash; provided, however, that
if the Trustees determine, which determination shall be conclusive, that
conditions exist which make payment wholly in cash unwise or undesirable,
the Trust may make payment wholly or partly in Securities or other assets
belonging to the Overseas Fund at the value of such Securities or assets
used in such determination of net asset value. Notwithstanding the
foregoing, the Trust may postpone payment of the redemption price and may
suspend the right of the holders of Shares of the Overseas Fund to require
the Trust to redeem Shares of the Overseas Fund during any period or at any
time when and to the extent permissible under the 1940 Act.
- 3 -
<PAGE>
Certificate of Designation
Janus Overseas Fund
(g) Redemption at the Option of the Trust. Each Share of the Overseas
Fund shall be subject to redemption at the option of the Trust at the
redemption price which would be applicable if such Share were then being
redeemed by the Shareholder pursuant to subsection (f) hereof: (i) at any
time, if the Trustees determine in their sole discretion that failure to so
redeem may have materially adverse consequences to the holders of the
Shares of the Trust or of any Fund, or (ii) upon such other conditions with
respect to maintenance of Shareholder accounts of a minimum amount as may
from time to time be determined by the Trustees and set forth in the then
current Prospectus of the Overseas Fund. Upon such redemption the holders
of the Shares so redeemed shall have no further right with respect thereto
other than to receive payment of such redemption price.
(h) Net Asset Value. The net asset value per Share of the Overseas
Fund at any time shall be the quotient obtained by dividing the value of
the net assets of the Overseas Fund at such time (being the current value
of the assets belonging to the Overseas Fund, less its then existing
liabilities) by the total number of Shares of the Overseas Fund then
outstanding, all determined in accordance with the methods and procedures,
including without limitation those with respect to rounding, established by
the Trustees from time to time. The Trustees may determine to maintain the
net asset value per Share of the Overseas Fund at a designated constant
dollar amount and in connection therewith may adopt procedures not
inconsistent with the 1940 Act for the continuing declaration of income
attributable to the Overseas Fund as dividends payable in additional Shares
of the Overseas Fund at the designated constant dollar amount and for the
handling of any losses attributable to the Overseas Fund. Such procedures
may provide that in the event of any loss each Shareholder shall be deemed
to have contributed to the shares of beneficial interest account of the
Overseas Fund his pro rata portion of the total number of Shares required
to be canceled in order to permit the net asset value per share of the
Overseas Fund to be maintained, after reflecting such loss, at the
designated constant dollar amount. Each Shareholder of the Overseas Fund
shall be deemed to have expressly agreed, by his investment in the Overseas
Fund, to make the contribution referred to in the preceding sentence in the
event of any such loss.
(i) Transfer. All Shares of the Overseas Fund shall be transferable,
but transfers of Shares of the Overseas Fund will be recorded on the Share
transfer records of the Trust applicable to the Overseas Fund only at such
times as Shareholders shall have the right to require the Trust to redeem
Shares of the Overseas Fund and at such other times as may be permitted by
the Trustees.
- 4 -
<PAGE>
Certificate of Designation
Janus Overseas Fund
(j) Equality. All Shares of the Overseas Fund shall represent an equal
proportionate interest in the assets belonging to the Overseas Fund
(subject to the liabilities of the Overseas Fund), and each Share of the
Overseas Fund shall be equal to each other Share thereof; but the
provisions of this sentence shall not restrict any distinctions permissible
under subsection (c) hereof that may exist with respect to dividends and
distributions on Shares of the Overseas Fund. The Trustees may from time to
time divide or combine the Shares of the Overseas Fund into a greater or
lesser number of Shares of the Overseas Fund without thereby changing the
proportionate beneficial interest in the assets belonging to the Overseas
Fund or in any way affecting the rights of the holders of Shares of any
other Fund.
(k) Rights of Fractional Shares. Any fractional Share of the Overseas
Fund shall carry proportionately all the rights and obligations of a whole
Share of the Overseas Fund, including rights and obligations with respect
to voting, receipt of dividends and distributions, redemption of Shares,
and liquidation of the Trust or of the Overseas Fund.
(l) Conversion Rights. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that holders
of Shares of the Overseas Fund shall have the right to convert said Shares
into Shares of one or more other Funds in accordance with such requirements
and procedures as the Trustees may establish.
(m) Amendment, etc. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument in writing
signed by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), provided that, if any
amendment adversely affects the rights of the Shareholders of the Overseas
Fund, such amendment may be adopted by an instrument in writing signed by a
Majority of the Trustees (or by an officer of the Trust pursuant to the
vote of a Majority of the Trustees) when authorized to do so by the vote in
accordance with Section 7.1 of the Declaration of Trust of the holders of a
majority of all the Shares of the Overseas Fund outstanding and entitled to
vote.
- 5 -
<PAGE>
Certificate of Designation
Janus Overseas Fund
(n) Incorporation of Defined Terms. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to those
terms in the Declaration of Trust filed with the Secretary of State of the
Commonwealth of Massachusetts.
The Trustees further direct that, upon the execution of this Certificate of
Designation, the Trust take all necessary action to file a copy of this
Certificate of Designation with the Secretary of State of The Commonwealth of
Massachusetts and at any other place required by law or by the Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set her hand and seal this 10th day
of February, 1994.
/s/ Janice M. Teague
Janice M. Teague, Secretary
- 6 -
<PAGE>
ACKNOWLEDGMENT
STATE OF COLORADO )
CITY AND :
COUNTY OF DENVER )
On this 10th day of February, 1994, before me personally came Janice M.
Teague, Secretary of Janus Investment Fund, to me known, and known to me to be
the person described in and who executed the foregoing instrument, and
acknowledged that she had executed the same as her free act and deed. Witness my
hand and official seal.
/s/ Dexter S. Buck
Notary Public
My commission expires 9/14/96
EXHIBIT 1(n)
JANUS INVESTMENT FUND
Form of Certificate of Amendment
The undersigned, being the Secretary of Janus Investment Fund, a trust with
transferable shares of the type commonly called a Massachusetts business trust
(the "Trust"), DOES HEREBY CERTIFY that, pursuant to the authority conferred
upon the Trustees of the Trust by Section 9.3 of the Agreement and Declaration
of Trust, dated February 11, 1986, as amended to date (hereinafter, as so
amended, referred to as the "Declaration of Trust"), and by the affirmative vote
of a Majority of the Trustees at a meeting duly called and held on
______________, the Declaration of Trust is amended as follows:
1. Section 1.4 ("Definitions") of the Declaration of Trust is hereby
amended by adding a new definition, "Class" or "Classes," which shall read
in its entirety as follows:
"Class" or "Classes" shall mean any class of Shares of a Series
authorized by the Trustees to represent differing interests in such
Series pursuant to the provisions of Section 6.1.
2. The definition of "Majority Shareholder Vote" set forth in Section 1.4
of the Declaration of Trust is hereby amended and restated in its entirety
to read as follows:
"Majority Shareholder Vote," as used with respect to the election of
any Trustee at a meeting of Shareholders, shall mean the vote for the
election of such Trustee of a plurality of all outstanding Shares of
the Trust, without regard to Series or Class, represented in person or
by proxy and entitled to vote thereon, provided that a quorum
determined as provided in Section 7.5 hereof) is present; and as used
with respect to any other action required or permitted to be taken by
Shareholders, shall mean the vote for such action of the holders of
that majority of all outstanding Shares (or, where a separate vote of
Shares of any particular Series or Class is to be taken, the
affirmative vote of that majority of the outstanding Shares of that
Series or Class) of the Trust which consists of: (i) a majority of all
Shares (or of Shares of the particular Series or Class) represented in
person or by proxy and entitled to vote on such action at the meeting
of Shareholders at which such action is to be taken, provided that a
quorum (determined as provided in Section 7.5 hereof) is present, or
(ii) if such action is to be
-1-
<PAGE>
taken by written consent of Shareholders, a majority of all Shares (or
of Shares of the particular Series or Class) issued and outstanding
and entitled to vote on such action; and as used with respect to any
action requiring the affirmative vote of "a majority of the
outstanding voting securities", as the quoted phrase is defined in the
1940 Act, of the Trust or of any Fund, shall mean the vote for such
action at a meeting of Shareholders of the smallest majority of all
outstanding Shares of the Trust (or of Shares of the particular Series
or Class) entitled to vote on such action which satisfies such 1940
Act voting requirement.
3. Section 6.1 ("Description of Funds and Shares") of the Declaration of
Trust is hereby amended and restated in its entirety to read as follows:
SECTION 6.1 Description of Funds and Shares.
(a) Shares; Funds; Series and Classes of Shares. The beneficial
interest in the Trust shall be divided into Shares having a nominal or
par value of one cent ($.01) per Share, of which an unlimited number
may be issued. The Trustees shall have the power, without any
requirement of Shareholder approval, from time to time: (i) to
establish and designate one or more separate, distinct and independent
Funds, in addition to the Funds established and designated by Section
6.2 hereof, into which the assets of the Trust shall be divided; (ii)
to authorize a separate Series of Shares for each such additional Fund
(each of which Series shall represent interests only in the Fund with
respect to which such Series was authorized); and (iii) to establish
and designate two or more separate Classes of Shares for any Series
by, from time to time, setting or changing in one or more respects
provisions applicable to such Class or Classes relating to sales
charges, expenses, any rights of redemption and the price, terms and
manner of redemption, special and relative rights as to dividends and
distributions and on liquidation, sinking or purchase fund provisions,
conversion rights and (subject to Article VII hereof) conditions under
which the Shareholders of the several Classes shall have separate
voting rights or no voting rights (but no such provision that
adversely affects the holders of Shares of any Series or Class shall
become effective unless approved in compliance with Section 9.3).
Except as otherwise provided as to a particular Fund herein, or in the
Certificate of Designation therefor, the Trustees shall have all the
rights and powers, and be subject to all the duties and obligations,
with respect
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<PAGE>
to each such Fund and the assets and affairs thereof as they have
under this Declaration of Trust, with respect to the Trust and the
Trust Property in general.
(b) Establishment, etc. of Funds; Authorization of Shares and Classes.
In order to establish and designate any Fund in addition to the Fund
established and designated in Section 6.2 hereof and to authorize the
Shares thereof, a Majority of the Trustees (or an officer of the Trust
pursuant to the vote of a Majority of the Trustees) shall execute an
instrument setting forth such establishment and designation and the
relative rights and preferences of the Shares of the Series or Classes
representing interests in such Fund and the manner in which the same
may be amended (a "Certificate of Designation"), which may provide
that the number of Shares of such Series which may be issued is
unlimited, or may limit the number issuable. At any time that there
are outstanding no Shares of any particular Series or Class previously
established and designated, including any Series or Class representing
interests in the Fund established and designated in Section 6.2
hereof, the Trustees may by an instrument executed by a Majority of
the Trustees (or by an officer of the Trust pursuant to the vote of a
Majority of the Trustees) terminate such Series or Class and the
establishment and designation thereof and the authorization of its
Shares (a "Certificate of Termination"). Each Certificate of
Designation, Certificate of Termination and any instrument amending a
Certificate of Designation shall have the status of an amendment to
this Declaration of Trust, and shall be filed and become effective as
provided in Section 9.4 hereof.
(c) Character of Separate Funds and Shares Thereof. Each Fund
established hereunder shall be a separate component of the assets of
the Trust, and the holders of Shares of the Series representing the
beneficial interest in the assets of that Fund shall be considered
Shareholders of such Fund, but such Shareholders shall also be
considered Shareholders of the Trust for purposes of receiving reports
and notices and, except as otherwise provided herein or in the
Certificate of Designation of a particular Fund as to such Fund, or as
required by the 1940 Act or other applicable law, the right to vote,
all without distinction by Series.
(d) Consideration for Shares. The Trustees may issue Shares of any
Series for such consideration (which may include property subject to,
or acquired in connection with the assumption of,
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<PAGE>
liabilities) and on such terms as they may determine (or for no
consideration if pursuant to a Share dividend or split-up), all
without action or approval of the Shareholders. All Shares when so
issued on the terms determined by the Trustees shall be fully paid and
nonassessable (but may be subject to mandatory contribution back to
the Trust as provided in Section 6.2(h) hereof). The Trustees may
classify or reclassify any unissued Shares, or any Shares of any
Series or Class previously issued and reacquired by the Trust, into
Shares of one or more other Funds that may be established and
designated from time to time.
4. Section 7.1 ("Voting Powers") of the Declaration of Trust is hereby
amended and restated in its entirety to read as follows:
SECTION 7.1 Voting Powers. The Shareholders shall have power to vote
only (i) for the election or removal of Trustees as provided in
Sections 4.1(c) and (e) hereof, (ii) with respect to the approval or
termination in accordance with the 1940 Act of any contract with a
Contracting Party as provided in Section 5.2 hereof as to which
Shareholder approval is required by the 1940 Act, (iii) with respect
to any termination or reorganization of the Trust or any Fund to the
extent and as provided in Sections 9.1 and 9.2 hereof, (iv) with
respect to any amendment of this Declaration of Trust to the extent
and as provided in Section 9.3 hereof, (v) to the same extent as the
stockholders of a Massachusetts business corporation as to whether or
not a court action, proceeding or claim should or should not be
brought or maintained derivatively or as a class action on behalf of
the Trust or any Fund, or the Shareholders of any of them (provided,
however, that a Shareholder of a particular Fund shall not in any
event be entitled to maintain a derivative or class action on behalf
of any other Fund or the Shareholders thereof), and (vi) with respect
to such additional matters relating to the Trust as may be required by
the 1940 Act, this Declaration of Trust, the Bylaws or any
registration of the Trust with the Commission (or any successor
agency) or any State, or as the Trustees may consider necessary or
desirable. If and to the extent that the Trustees shall determine that
such action is required by law or by this Declaration of Trust , they
shall cause each matter required or permitted to be voted upon at a
meeting or by written consent of Shareholders to be submitted to a
separate vote of the outstanding Shares of each Fund entitled to vote
thereon; provided, that (i) when expressly required by the 1940 Act or
by other law, actions of Shareholders shall be taken by Single Class
Voting of all
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<PAGE>
outstanding Shares of each Series or Class whose holders are entitled
to vote thereon; and (ii) when the Trustees determine that any matter
to be submitted to a vote of Shareholders affects only the rights or
interests of Shareholders of one or more but not all Funds or of one
or more but not all Classes of a single Fund, then only the
Shareholders of the Funds or Classes so affected shall be entitled to
vote thereon.
5. Section 7.5 ("Quorum and Required Vote") of the Declaration of Trust is
hereby amended and restated in its entirety to read as follows:
SECTION 7.5 Quorum and Required Vote. Thirty percent (30%) of the
Shares entitled to vote on a matter shall be a quorum for the
transaction of business with respect to such matter at a Shareholders'
meeting, but any lesser number shall be sufficient for adjournments.
Any adjourned session or sessions may be held within a reasonable time
after the date set for the original meeting without the necessity of
further notice. A Majority Shareholder Vote at a meeting at which a
quorum is present shall decide any question, except when a different
vote is required or permitted by any provision of the 1940 Act or
other applicable law or by this Declaration of Trust or the Bylaws, or
when the Trustees shall in their discretion require a larger vote or
the vote of a majority or larger fraction of the Shares of one or more
particular Series or Classes.
6. Section 9.3 ("Amendments; etc.") of the Declaration of Trust is hereby
amended and restated in its entirety to read as follows:
SECTION 9.3 Amendments; etc. All rights granted to the Shareholders
under this Declaration of Trust are granted subject to the reservation
of the right to amend this Declaration of Trust as herein provided,
except that no amendment shall repeal the limitations on personal
liability of any Shareholder or Trustee or the prohibition of
assessment upon the Shareholders (otherwise than as permitted under
Section 6.2(h)) without the express consent of each Shareholder or
Trustee involved. Subject to the foregoing, the provisions of this
Declaration of Trust (whether or not related to the rights of
Shareholders) may be amended at any time, so long as such amendment
does not adversely affect the rights of any Shareholder with respect
to which such amendment is or purports to be applicable and so long as
such amendment is not in contravention of applicable law, including
the 1940 Act, by an
-5-
<PAGE>
instrument in writing signed by a Majority of the Trustees (or by an
officer of the Trust pursuant to the vote of a Majority of the
Trustees). Any amendment to this Declaration of Trust that adversely
affects the rights of all Shareholders may be adopted at any time by
an instrument in writing signed by a Majority of the Trustees (or by
an officer of the Trust pursuant to a vote of a Majority of the
Trustees) when authorized to do so by the vote in accordance with
Section 7.1 hereof of Shareholders holding a majority of all the
Shares outstanding and entitled to vote, without regard to Series, or
if said amendment adversely affects the rights of the Shareholders of
less than all of the Funds or of less than all of the Classes of
Shares of any Fund, by the vote of the holders of a majority of all
the Shares entitled to vote of each Fund or of each Class, as the case
may be, so affected. Subject to the foregoing, any such amendment
shall be effective when the terms thereof have been duly adopted, as
aforesaid. A certificate (which may be a part of such instrument) to
the effect that such amendment has been duly adopted, and setting
forth the circumstances thereof, shall be executed and acknowledged by
a Trustee or officer of the Trust and filed as provided in Section 9.4
hereof (but such filing shall not be a prerequisite to the
effectiveness of such amendment).
-6-
<PAGE>
IN WITNESS WHEREOF, the undersigned has set her hand and seal this ____ day
of ____________, 1994.
________________________________________
Janice M. Teague, Secretary
STATE OF COLORADO )
) ss.
CITY AND COUNTY OF DENVER )
BEFORE ME, the undersigned authority, on this day personally appeared
Janice M. Teague, Secretary of Janus Investment Fund, who, being by me first
duly sworn, stated on her oath that the foregoing document is true and correct
and that she executed the same for the purposes and consideration therein
expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this ____ day of ___________, 1994.
My Commission Expires: ________________________________________
_________________________ Notary Public
-7-
EXHIBIT 1(o)
JANUS INVESTMENT FUND
Form of Certificate of Designation
The undersigned, being the Secretary of Janus Investment Fund (hereinafter
referred to as the "Trust"), a trust with transferable shares of the type
commonly called a Massachusetts business trust, DOES HEREBY CERTIFY that,
pursuant to the authority conferred upon the Trustees of the Trust by Section
6.1(b) and Section 9.3 of the Agreement and Declaration of Trust, dated February
11, 1986, as amended to date (hereinafter, as so amended, referred to as the
"Declaration of Trust"), and by the affirmative vote of a Majority of the
Trustees at a meeting duly called and held on _____________, 1994, the
Declaration of Trust was amended to establish and designate new a Series of
Shares of the Trust, the [Janus Money Market Fund] [Janus Government Money
Market Fund] [Janus Tax-Exempt Money Market Fund]. The text of the resolution
setting forth such establishment and designation is as follows:
There is hereby established and designated the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]. The
beneficial interest in the [Janus Money Market Fund] [Janus Government Money
Market Fund] [Janus Tax-Exempt Money Market Fund] shall be divided into Shares
having a nominal or par value of one cent ($.01) per Share, consisting of three
separate Classes. An unlimited number of Shares of each Class may be issued,
which Shares shall represent interests only in the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]. The
Shares of the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] shall have the following rights and
preferences:
(a) Assets Belonging to the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund].
Any portion of the Trust Property allocated to the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund], and all consideration received by the Trust for the
issue or sale of Shares of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund],
together with all assets in which such consideration is invested or
reinvested, all interest, dividends, income, earnings, profits and
gains therefrom, and proceeds thereof, including any proceeds derived
from the sale, exchange or liquidation of such assets, and any funds
or payments derived from any reinvestment of such proceeds in whatever
form the same may be, shall be held by the Trustees in trust for the
benefit of the holders of Shares of the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market
Fund] and shall irrevocably belong to the [Janus Money Market Fund]
[Janus Government Money
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<PAGE>
Market Fund] [Janus Tax-Exempt Money Market Fund] for all purposes,
and shall be so recorded upon the books of account of the Trust, and
the Shareholders of any other Fund who are not Shareholders of the
[Janus Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund] shall not have, and shall be
conclusively deemed to have waived, any claims to the assets of the
[Janus Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund]. Such consideration, assets, interest,
dividends, income, earnings, profits, gains and proceeds, together
with any General Items allocated to the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market
Fund] as provided in the following sentence, are herein referred to
collectively as "Fund Assets" of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund],
and as assets "belonging to" the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]. In
the event that there are any assets, income, earnings, profits, and
proceeds thereof, funds, or payments which are not readily
identifiable as belonging to any particular Fund (collectively
"General Items"), the Trustees shall allocate such General Items to
and among any one or more of the Funds of the Trust in such manner and
on such basis as they, in their sole discretion, deem fair and
equitable; and any General Items so allocated to the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] shall belong to and be part of the Fund Assets of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund]. Each such allocation by the
Trustees shall be conclusive and binding upon the Shareholders and
creditors of all the Funds for all purposes.
(b) Liabilities of the [Janus Money Market Fund] [Janus Government
Money Market Fund] [Janus Tax-Exempt Money Market Fund]. The assets
belonging to the [Janus Money Market Fund] [Janus Government Money
Market Fund] [Janus Tax-Exempt Money Market Fund] shall be charged
with the liabilities incurred by or arising in respect of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-
- 2 -
<PAGE>
Exempt Money Market Fund] and all expenses, costs, charges and
reserves attributable to the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund],
which may be allocated among the different Classes of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] as the Trustees may from time to time determine to
be appropriate, and any general liabilities, expenses, costs, charges
or reserves of the Trust which are not readily identifiable as
pertaining to any particular Fund shall be allocated and charged by
the Trustees to and among any one or more of the Funds of the Trust in
such manner and on such basis as the Trustees in their sole discretion
deem fair and equitable. The liabilities, expenses, costs, charges and
reserves allocated and so charged to the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market
Fund] are herein referred to as "liabilities of" the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund]. Each allocation of liabilities, expenses, costs,
charges and reserves by the Trustees shall be conclusive and binding
upon the Shareholders of all the Funds for all purposes. Any creditor
of the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] may look only to the assets of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] to satisfy such creditor's
claims, and the creditors of a particular Class of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] may look only to the share of that Class in the
assets of the [Janus Money Market Fund] [Janus Government Money Market
Fund] [Janus Tax-Exempt Money Market Fund] to satisfy their claims.
(c) Dividends. Dividends and distributions on Shares of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund] may be paid with such frequency as the
Trustees may determine, which may be daily or otherwise pursuant to a
standing resolution or resolutions adopted only once or with such
frequency as the Trustees may determine, to the Shareholders of the
[Janus Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund], from such of the income, accrued or
realized, and capital gains, realized or unrealized, and out of the
- 3 -
<PAGE>
assets belonging to the [Janus Money Market Fund] [Janus Government
Money Market Fund] [Janus Tax-Exempt Money Market Fund], as the
Trustees may determine, after providing for actual and accrued
liabilities of the [Janus Money Market Fund] [Janus Government Money
Market Fund] [Janus Tax-Exempt Money Market Fund]. Dividends and
distributions shall be in such amounts as may be declared from time to
time by the Trustees, and such dividends and distributions may vary as
between the Classes of the [Janus Money Market Fund] [Janus Government
Money Market Fund] [Janus Tax-Exempt Money Market Fund] to reflect
differing allocations among such Classes of the liabilities of the
[Janus Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund] and any resultant differences between
the net asset value of such several Classes, to such extent and for
such purposes as the Trustees may deem appropriate, but dividends and
distributions on the Shares of a particular Class shall be distributed
pro rata to the Shareholders of that Class in proportion to the number
of such Shares held by such holders at the date and time of record
established for the payment of such dividends or distributions.
Notwithstanding the foregoing, the Trustees may determine, in
connection with any dividend or distribution program or procedure,
that no dividend or distribution shall be payable on Shares as to
which the Shareholder's purchase order and/or payment have not been
received by the time or times established by the Trustees under such
program or procedure, or that dividends or distributions shall be
payable on Shares which have been tendered by the holder thereof for
redemption or repurchase, but the redemption or repurchase proceeds of
which have not yet been paid to such Shareholder. Dividends and
distributions on the Shares of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund] may
be made in cash or Shares of any Class of the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund] or a combination thereof as determined by the Trustees,
or pursuant to any program that the Trustees may have in effect at the
time for the election by each Shareholder of the mode of the making of
such dividend or distribution to that Shareholder. Any such dividend
or distribution paid in Shares will be paid at the net asset value
thereof as determined in accordance with subsection (h) hereof, but
without any load or sales charge.
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<PAGE>
(d) Liquidation. In the event of the liquidation or dissolution of the
Trust, the Shareholders of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]
shall be entitled to receive, when and as declared by the Trustees,
the excess of the Fund Assets over the liabilities of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund]. The assets so distributable to the Shareholders of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] shall be allocated among the
Classes of the [Janus Money Market Fund] [Janus Government Money
Market Fund] [Janus Tax-Exempt Money Market Fund] in proportion to the
respective aggregate net asset value of the outstanding Shares
thereof, and shall be distributed to the Shareholders of each such
Class in proportion to the number of Shares of that Class held by them
and recorded on the books of the Trust. The liquidation of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund], or of any Class thereof, may be
authorized by vote of a Majority of the Trustees, subject to the
affirmative vote of "a majority of the outstanding voting securities"
of the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] or such Class, as the quoted
phrase is defined in the 1940 Act, determined in accordance with last
clause of the definition of "Majority Shareholder Vote" in Section 1.4
of the Declaration of Trust.
(e) Voting. The Shareholders shall have the voting rights set forth in
or determined under Article VII of the Declaration of Trust.
(f) Redemption by Shareholder. Each holder of Shares of any Class of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] shall have the right at such
times as may be permitted by the Trust, but no less frequently than
once each week, to require the Trust to redeem all or any part of such
Shares at a redemption price equal to the net asset value per Share of
such Class next determined in accordance with subsection (h) hereof
after the Shares are properly tendered for redemption; provided, that
the Trustees may from time to time, in their discretion, determine and
impose a fee for such redemption. Payment of the redemption price
shall be
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<PAGE>
in cash; provided, however, that if the Trustees determine, which
determination shall be conclusive, that conditions exist which make
payment wholly in cash unwise or undesirable, the Trust may make
payment wholly or partly in Securities or other assets belonging to
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] at the value of such Securities
or assets used in such determination of net asset value.
Notwithstanding the foregoing, the Trust may postpone payment of the
redemption price and may suspend the right of the holders of Shares of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund] or any Class thereof to require
the Trust to redeem Shares of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]
during any period or at any time when and to the extent permissible
under the 1940 Act.
(g) Redemption at the Option of the Trust. Each Share of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund] shall be subject to redemption at the
option of the Trust at the redemption price which would be applicable
if such Share were then being redeemed by the Shareholder pursuant to
subsection (f) hereof: (i) at any time, if the Trustees determine in
their sole discretion that failure to so redeem may have materially
adverse consequences to the holders of the Shares of the Trust or of
any Fund, or (ii) upon such other conditions with respect to
maintenance of Shareholder accounts of a minimum amount as may from
time to time be determined by the Trustees and set forth in the then
current Prospectus of the [Janus Money Market Fund] [Janus Government
Money Market Fund] [Janus Tax-Exempt Money Market Fund]. Upon such
redemption the holders of the Shares so redeemed shall have no further
right with respect thereto other than to receive payment of such
redemption price.
(h) Net Asset Value. Subject to the provisions of the two sentences
immediately following, the net asset value per Share of any Class of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market] Fund at any time shall be the quotient
obtained by dividing the value of the net assets of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] or the share of such Class in such assets,
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<PAGE>
as the case may be, at such time (being the current value of the
assets belonging to the [Janus Money Market Fund] [Janus Government
Money Market Fund] [Janus Tax-Exempt Money Market Fund], or the share
of such Class therein, less the then-existing liabilities of the
[Janus Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund], or the share of such Class in such
liabilities) by the total number of Shares of that Class then
outstanding, all determined in accordance with the methods and
procedures, including without limitation those with respect to
rounding, established by the Trustees from time to time. The aggregate
net asset value of the several Classes of the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund] shall be separately computed, and may vary from one
another. The Trustees shall establish procedures for the allocation of
investment income or capital gains and expenses and liabilities of the
separate Classes of Shares of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]
among the several Classes of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund], in
order to reflect the varying net asset values of, and the liabilities
and expenses attributable to, such Classes. The Trustees may determine
to maintain the net asset value per Share of the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund] at a designated constant dollar amount and in connection
therewith may adopt procedures not inconsistent with the 1940 Act for
the continuing declaration of income attributable to the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] as dividends payable in additional Shares of the
[Janus Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund] at the designated constant dollar amount
and for the handling of any losses attributable to the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund]. Such procedures may provide that in the event of
any loss each Shareholder shall be deemed to have contributed to the
shares of beneficial interest account of the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market
Fund] such Shareholder's pro rata portion of the total number of
Shares required to be canceled
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<PAGE>
in order to permit the net asset value per share of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] to be maintained, after reflecting such loss, at
the designated constant dollar amount. Each Shareholder of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund] shall be deemed by his purchase of
Shares of any Class thereof to have expressly agreed to make the
contribution referred to in the preceding sentence in the event of any
such loss.
(i) Transfer. All Shares of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]
shall be transferable, but transfers of Shares of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] will be recorded on the Share transfer records of
the Trust applicable to the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund]
only at such times as Shareholders shall have the right to require the
Trust to redeem Shares of the [Janus Money Market Fund] [Janus
Government Money Market Fund] [Janus Tax-Exempt Money Market Fund] and
at such other times as may be permitted by the Trustees.
(j) Equality. All Shares of each Class of the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund] shall represent an equal proportionate interest in the
share of such Class in the assets belonging to the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund], subject to a like share of the liabilities of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund], adjusted for any liabilities
specifically allocable to that Class, and each Share of any such Class
shall be equal to each other Share thereof; but the interests
represented by the Shares of the different Classes of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] shall reflect any distinctions among the several
Classes of the [Janus Money Market Fund] [Janus Government Money
Market Fund] [Janus Tax-Exempt Money Market Fund] existing under this
Certificate of Designation. The Trustees may from time to time divide
or combine the Shares of the [Janus
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<PAGE>
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund], or any Class of the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund], into a greater or lesser number of Shares of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund] Fund or Class without thereby changing
the proportionate beneficial interest in the assets belonging to the
[Janus Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market] Fund or in any way affecting the rights of
the holders of Shares of any other Fund or Class.
(k) Rights of Fractional Shares. Any fractional Share of any Series or
Class shall carry proportionately all the rights and obligations of a
whole Share of that Series or Class, including rights and obligations
with respect to voting, receipt of dividends and distributions,
redemption of Shares, and liquidation of the Trust or of the [Janus
Money Market Fund] [Janus Government Money Market Fund] [Janus
Tax-Exempt Money Market Fund].
(l) Conversion Rights. Subject to compliance with the requirements of
the 1940 Act, the Trustees shall have the authority to provide that
holders of Shares of the [Janus Money Market Fund] [Janus Government
Money Market Fund] [Janus Tax-Exempt Money Market Fund] shall have the
right to convert said Shares into Shares of one or more other Funds of
the Trust, that holders of any Class of Shares of the [Janus Money
Market Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt
Money Market Fund] shall have the right to convert such Shares into
Shares of one or more other Classes of the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market
Fund], and that Shares of any Class of the [Janus Money Market Fund]
[Janus Government Money Market Fund] [Janus Tax-Exempt Money Market
Fund] shall be automatically converted into Shares of another Class of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund], in each case in accordance with
such requirements and procedures as the Trustees may establish.
- 9 -
<PAGE>
(m) Amendment, etc. Subject to the provisions and limitations of
Section 9.3 of the Declaration of Trust and applicable law, this
Certificate of Designation may be amended by an instrument signed in
writing by a Majority of the Trustees (or by an officer of the Trust
pursuant to the vote of a Majority of the Trustees), provided that, if
any amendment adversely affects the rights of the holders of Shares of
the [Janus Money Market Fund] [Janus Government Money Market Fund]
[Janus Tax-Exempt Money Market Fund], or of any Class thereof, such
amendment may be adopted by an instrument signed in writing by a
Majority of the Trustees (or by an officer of the Trust pursuant to
the vote of a Majority of the Trustees) when authorized to do so by
the vote in accordance with Section 7.1 of the Declaration of Trust of
the holders of a majority of all the Shares of the [Janus Money Market
Fund] [Janus Government Money Market Fund] [Janus Tax-Exempt Money
Market Fund], or of the affected Class thereof, as the case may be,
outstanding and entitled to vote.
(n) Incorporation of Defined Terms. All capitalized terms which are
not defined herein shall have the same meanings as are assigned to
those terms in the Declaration of Trust filed with the Secretary of
State of the Commonwealth of Massachusetts.
The Trustees further direct that, upon the execution of this Certificate of
Designation, the Trust take all necessary action to file a copy of this
Certificate of Designation with the Secretary of State of The Commonwealth of
Massachusetts and at any other place required by law or by the Declaration of
Trust.
IN WITNESS WHEREOF, the undersigned has set her hand and seal this ____ day
of ___________, 1994.
________________________________________
Janice M. Teague, Secretary
- 10 -
<PAGE>
STATE OF COLORADO )
) ss.
CITY AND COUNTY OF DENVER )
BEFORE ME, the undersigned authority, on this day personally appeared
Janice M. Teague, Secretary of Janus Investment Fund, who, being by me first
duly sworn, stated on her oath that the foregoing document is true and correct
and that she executed the same for the purposes and consideration therein
expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this ____ day of ___________, 1994.
My Commission Expires: ________________________________________
_________________________ Notary Public
- 11 -
EXHIBIT 4(k)
[LOGO]
JANUS INVESTMENT FUND
(A Massachusetts Business Trust)
JANUS FEDERAL TAX-EXEMPT FUND
SHARES OF BENEFICIAL INTEREST
ACCOUNT NO.
THIS CERTIFIES that SPECIMEN CUSIP 471023
SEE REVERSE FOR CERTAIN DEFINITIONS
Is the owner of ________________ shares of beneficial interest in the JANUS
FEDERAL TAX-EXEMPT FUND series of Janus Investment Fund (the "Fund"), fully paid
and nonassessable, the said shares being issued and held subject to the
provisions of the Agreement and Declaration of Trust of the Fund, and all
amendments thereto, copies of which are on file with the Secretary of The
Commonwealth of Massachusetts. The said owner by accepting this certificate
agrees to and is bound by all of the said provisions. The shares represented
hereby are transferable in writing by the owner thereof in person or by attorney
upon surrender of this certificate to the Fund properly endorsed for transfer
(see the reverse side hereof). This certificate is executed on behalf of the
Trustees of the Fund as Trustees and not individually and the obligations hereof
are not binding upon any of the Trustees, officers or shareholders individually
but are binding only upon the assets and property of the JANUS FEDERAL
TAX-EXEMPT FUND series of Janus Investment Fund. This certificate is not valid
unless countersigned by the Transfer Agent.
Witness the facsimile seal of the Fund and the facsimile signatures of its duly
authorized officers.
Dated:
/s/ Janice M. Teague /s/ Thomas H. Bailey
SECRETARY PRESIDENT
[SEAL]
COUNTERSIGNED
INVESTORS FIDUCIARY TRUST COMPANY
(KANSAS CITY MISSOURI) TRANSFER AGENT
BY JANUS SERVICE CORPORATION
(DENVER COLORADO) SUBTRANSFER AGENT
AUTHORIZED SIGNATURE
EXHIBIT 4(m)
[LOGO]
JANUS INVESTMENT FUND
(A Massachusetts Business Trust)
JANUS OVERSEAS FUND
SHARES OF BENEFICIAL INTEREST
ACCOUNT NO.
THIS CERTIFIES that SPECIMEN CUSIP 471023
SEE REVERSE FOR CERTAIN DEFINITIONS
Is the owner of ________________ shares of beneficial interest in the JANUS
OVERSEAS FUND series of Janus Investment Fund (the "Fund"), fully paid and
nonassessable, the said shares being issued and held subject to the provisions
of the Agreement and Declaration of Trust of the Fund, and all amendments
thereto, copies of which are on file with the Secretary of The Commonwealth of
Massachusetts. The said owner by accepting this certificate agrees to and is
bound by all of the said provisions. The shares represented hereby are
transferable in writing by the owner thereof in person or by attorney upon
surrender of this certificate to the Fund properly endorsed for transfer (see
the reverse side hereof). This certificate is executed on behalf of the Trustees
of the Fund as Trustees and not individually and the obligations hereof are not
binding upon any of the Trustees, officers or shareholders individually but are
binding only upon the assets and property of the JANUS OVERSEAS FUND series of
Janus Investment Fund. This certificate is not valid unless countersigned by the
Transfer Agent.
Witness the facsimile seal of the Fund and the facsimile signatures of its duly
authorized officers.
Dated:
/s/ Janice M. Teague /s/ Thomas H. Bailey
SECRETARY PRESIDENT
[SEAL]
COUNTERSIGNED
INVESTORS FIDUCIARY TRUST COMPANY
(KANSAS CITY MISSOURI) TRANSFER AGENT
BY JANUS SERVICE CORPORATION
(DENVER COLORADO) SUBTRANSFER AGENT
AUTHORIZED SIGNATURE
EXHIBIT 4(m)
[LOGO]
JANUS INVESTMENT FUND
(A Massachusetts Business Trust)
JANUS OVERSEAS FUND
SHARES OF BENEFICIAL INTEREST
ACCOUNT NO.
THIS CERTIFIES that SPECIMEN CUSIP 471023
SEE REVERSE FOR CERTAIN DEFINITIONS
Is the owner of ________________ shares of beneficial interest in the JANUS
OVERSEAS FUND series of Janus Investment Fund (the "Fund"), fully paid and
nonassessable, the said shares being issued and held subject to the provisions
of the Agreement and Declaration of Trust of the Fund, and all amendments
thereto, copies of which are on file with the Secretary of The Commonwealth of
Massachusetts. The said owner by accepting this certificate agrees to and is
bound by all of the said provisions. The shares represented hereby are
transferable in writing by the owner thereof in person or by attorney upon
surrender of this certificate to the Fund properly endorsed for transfer (see
the reverse side hereof). This certificate is executed on behalf of the Trustees
of the Fund as Trustees and not individually and the obligations hereof are not
binding upon any of the Trustees, officers or shareholders individually but are
binding only upon the assets and property of the JANUS OVERSEAS FUND series of
Janus Investment Fund. This certificate is not valid unless countersigned by the
Transfer Agent.
Witness the facsimile seal of the Fund and the facsimile signatures of its duly
authorized officers.
Dated:
/s/ Janice M. Teague /s/ Thomas H. Bailey
SECRETARY PRESIDENT
[SEAL]
COUNTERSIGNED
INVESTORS FIDUCIARY TRUST COMPANY
(KANSAS CITY MISSOURI) TRANSFER AGENT
BY JANUS SERVICE CORPORATION
(DENVER COLORADO) SUBTRANSFER AGENT
AUTHORIZED SIGNATURE
EXHIBIT 8(e)
JANUS GROUP OF MUTUAL FUNDS
P.O. Box 173375
Denver, Colorado 80217-3375
800/5252-3713
LETTER AGREEMENT
October 9, 1992
State Street Bank and Trust Company
1776 Heritage Drive
No. Quincy, MA 02171
Gentlemen:
Please be advised that Janus Investment Fund (the "Fund") has established
several new series of shares as noted below. In accordance with the Additional
Funds provision in Section 16 of the Custodian Contract dated July 31, 1986, as
amended, between the Fund and State Street Bank and Trust Company ("State
Street"), the Fund hereby requests confirmation that State Street will act as
custodian for foreign securities for the new series under the terms of the
contract.
Newly Organized Series:
Janus Balanced Fund
Janus Enterprise Fund
Janus Short-Term Bond Fund
Reorganized Series:
Janus Twenty Fund (formerly Janus Twenty Fund, Inc.)
Janus Venture Fund (formerly Janus Venture Fund, Inc.)
Janus Flexible Income Fund
(formerly a series of Janus Income Series)
Janus Intermediate Government Securities Fund
(formerly a series of Janus Income Series)
The new series established pursuant to the reorganization of Janus Twenty
Fund, Inc., Janus Venture Fund, Inc. and Janus Income Series (including the
series Janus Flexible Income Fund and Janus Intermediate Government Securities
Fund) render the separate Custodian Contracts between such funds and State
Street unnecessary. Accordingly, this letter also serves as notification of
termination of such Custodian Contracts.
Please indicate your acceptance of the foregoing by executing two copies of
this Letter Agreement, returning one copy to the Fund and retaining one copy for
your records.
JANUS INVESTMENT FUND
By /s/ David C. Tucker
David C. Tucker, Vice President
STATE STREET BANK AND TRUST COMPANY
By /s/ ___________________________
Agreed to this 26 day of October, 1992
EXHIBIT 8(f)
LETTER AGREEMENT
April 28, 1993
State Street Bank and Trust Company
1776 Heritage Drive
Mutual Fund Services A2 East
No. Quincy, MA 02171
Gentlemen:
Please be advised that Janus Investment Fund (the "Fund") has established
Janus Mercury Fund and Janus Federal Tax-Exempt Fund as two new series of the
Fund. In accordance with the Additional Funds provision in Section 16 of the
Custodian Contract dated July 31, 1986, as amended, between the Fund and State
Street Bank and Trust Company ("State Street"), the Fund hereby requests
confirmation that State Street will act as custodian for foreign securities for
the new series under the terms of the contract.
Please indicate your acceptance of the foregoing by executing two copies of
this Letter Agreement, returning one copy to the Fund and retaining one copy for
your records.
JANUS INVESTMENT FUND
/s/ David C. Tucker
David C. Tucker, Vice President
STATE STREET BANK AND TRUST COMPANY
By /s/ Angela M. Mildram
Angela Mildram, Assistant Vice President
Agreed to this 11th day of May, 1993
CC: Steven R. Goodbarn
Janice M. Teague
EXHIBIT 8(g)
JANUS FUNDS
P.O. Box 173375
Denver, Colorado 80217-3375
800 525-3713
LETTER AGREEMENT
April 4, 1994
Mr. Donald DeMarco, Vice President
State Street Bank and Trust Company
One Heritage Drive
Mutual Fund Services P2 North
No. Quincy, MA 02171
Dear Mr. DeMarco:
Please be advised that Janus Investment Fund (the "Fund") has established
Janus Overseas Fund as a new series of the Fund. Pursuant to Section 16 of the
Custodian Contract dated July 31, 1986, as amended, between the Fund and State
Street Bank and Trust Company ("State Street"), the Fund hereby requests
confirmation that State Street will act as custodian for the new series under
the terms of the contract.
Please indicate your acceptance of the foregoing by executing two copies of
this Letter Agreement, returning one copy to the Fund and retaining one copy for
your records.
JANUS INVESTMENT FUND
/s/ Janice M. Teague
Janice M. Teague, Secretary
STATE STREET BANK AND TRUST COMPANY
By /s/_________________________
Agreed to this 6 day of April, 1994
CC: Deborah E. Bielicke
Steven R. Goodbarn
Stephen L. Stieneker
David C. Tucker
EXHIBIT 8(h)
FORM OF
CUSTODY AGREEMENT
Dated _______________, 199_
Between
UMB BANK, N.A.
and
JANUS INVESTMENT FUND
on behalf of
Janus Money Market Fund
Janus Government Money Market Fund
Janus Tax-Exempt Money Market Fund
<PAGE>
Table of Contents
SECTION PAGE
1. Appointment of Custodian 1
2. Definitions 1
(a) Securities 1
(b) Assets 1
(c) Instructions and Special Instructions 1
3. Delivery of Corporate Documents 2
4. Powers and Duties of Custodian and Domestic Subcustodian 3
(a) Safekeeping 3
(b) Manner of Holding Securities 3
(c) Free Delivery of Assets 5
(d) Exchange of Securities 5
(e) Purchase of Assets 5
(f) Sales of Assets 6
(g) Options 7
(h) Futures Contracts 7
(i) Segregated Accounts 8
(j) Depositary Receipts 8
(k) Corporate Actions' Put Bonds, Called Bonds, Etc. 8
(l) Interest Bearing Deposits 9
(m) Foreign Exchange Transactions Other than as Principal 9
(n) Pledges or Loans of Securities 10
(o) Stock Dividends, Rights, Etc. 10
(p) Routine Dealings 10
(q) Collections 11
(r) Bank Accounts 11
(s) Dividends, Distributions and Redemptions 11
(t) Shares of a Fund purchased by such Fund 11
(u) Shares of a Fund purchased from such Fund 11
(v) Proxies and Notices; Compliance with
the Shareholders Communication Act of 1985 12
(w) Books and Records 12
(x) Opinion of Fund's Independent Certified Public Accountants 13
(y) Reports by Independent Certified Public Accountants 13
(z) Bills and Others Disbursements 13
5. Subcustodians 13
(a) Domestic Subcustodians 13
(b) Special Subcustodians 14
(c) Termination of a Subcustodian 14
<PAGE>
6. Standard of Care 14
(a) General Standard of Care 14
(b) Actions Prohibited by Applicable Law,
Events Beyond Custodian's Control,
Armed Conflict, Sovereign Risk, Etc. 14
(c) Liability for Past Records 15
(d) Advice of Counsel 15
(e) Advice of the Fund and Others 15
(f) Instructions Appearing to be Genuine 15
(g) Exceptions from Liability 16
7. Liability of the Custodian for Actions of Others 16
(a) Domestic Subcustodians 16
(b) Securities Systems, Interim Subcustodians,
Special Subcustodians, Securities
Depositories and Clearing Agencies 16
(c) Defaults of Insolvencies of Brokers,
Banks, Etc. 16
(d) Reimbursement of Expenses 17
8. Indemnification
(a) Indemnification by Fund 17
(b) Indemnification by Custodian 17
9. Advances 17
10. Liens 18
11. Compensation 18
12. Powers of Attorney 19
13. Termination and Assignment 19
14. Additional Funds 19
15. Notices 19
16. Miscellaneous 20
<PAGE>
CUSTODY AGREEMENT
This agreement made as of this day of , 199_, between UMB Bank, n.a., a
national banking association with its principal place of business located at
Kansas City, Missouri (hereinafter "Custodian"), and Janus Investment Fund (the
"Trust" on behalf of each of the Funds set forth on Appendix B hereto, together
with such additional Funds which shall from time to time be made parties to this
Agreement in the manner set forth herein (individually, a "Fund" and
collectively, the "Funds").
WITNESSETH:
WHEREAS, each Fund is a separate series of the Trust representing shares of
beneficial interest in a separate portfolio of assets; and
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended; and
WHEREAS, each Fund desires to appoint Custodian as its custodian for the
custody of Assets (as hereinafter defined) owned by such Fund which Assets are
to be held in such accounts as such Fund may establish from time to time; and
WHEREAS, Custodian is willing to accept such appointment on the terms and
conditions hereof.
NOW, THEREFORE, in consideration of the mutual promises contained herein,
the parties hereto, intending to be legally bound, mutually covenant and agree
as follows:
1. APPOINTMENT OF CUSTODIAN.
Each Fund hereby appoints the Custodian as custodian of Assets belonging to
each such Fund which have been or may be from time to time deposited with the
Custodian. Custodian accepts such appointment as a custodian and agrees to
perform the duties and responsibilities of Custodian as set forth herein on the
conditions set forth herein.
2. DEFINITIONS.
For purposes of this Agreement, the following terms shall have the meanings
so indicated:
(a) "Security" or "Securities" shall mean stocks, bonds, bills,
rights, script, warrants, interim certificates and all negotiable or
nonnegotiable paper commonly known as Securities and other instruments or
obligations.
(b) "Assets" shall mean Securities, monies and other property held by
the Custodian for the benefit of a Fund.
(c)(1) "Instructions", as used herein, shall mean: (i) a tested telex,
a written (including, without limitation, facsimile
<PAGE>
transmission) request, direction, instruction or certification signed or
initialed by or on behalf of a Fund by an Authorized Person (as hereinafter
defined); (ii) a telephonic or other oral communication from a person the
Custodian reasonably believes to be an Authorized Person; or (iii) a
communication effected directly between an electro-mechanical or electronic
device or system (including, without limitation, computers) on behalf of a Fund.
Instructions in the form of oral communications shall be confirmed by the
appropriate Fund by tested telex or in writing in the manner set forth in clause
(i) above, but the lack of such confirmation shall in no way affect any action
taken by the Custodian in reliance upon oral Instructions which it reasonably
believes to be genuine prior to the Custodian's receipt of such confirmation.
Each Fund authorizes the Custodian to record any and all telephonic or other
oral Instructions communicated to the Custodian.
(2) "Special Instructions", as used herein, shall mean Instructions
countersigned or confirmed in writing by the Treasurer or any Assistant
Treasurer of a Fund or any other person designated by the Treasurer of such Fund
in writing, which countersignature or confirmation shall be included on the same
instrument containing the Instructions or on a separate instrument relating
thereto.
(3) Instructions and Special Instructions shall be delivered to the
Custodian at the address and/or telephone, facsimile transmission or telex
number agreed upon from time to time by the Custodian and the Funds.
(4) Where appropriate, Instructions and Special Instructions shall be
continuing instructions.
3. DELIVERY OF CORPORATE DOCUMENTS.
Each of the parties to this Agreement represents that its execution does
not violate any of the provisions of its respective charter, articles of
incorporation, articles of association or bylaws and all required corporate
action to authorize the execution and delivery of this Agreement has been taken.
The Trust has furnished the Custodian with copies, properly certified or
authenticated, '-with all amendments or supplements thereto, of the following
documents:
(a) Certificate of Incorporation (or equivalent document) of the
Trust as in effect on the date hereof;
(b) By-Laws of the Trust as in effect on the date hereof;
(c) Resolutions of the Trustees of the Trust appointing the Custodian
and approving the form of this Agreement; and
(d) Each Fund's current prospectus and statements of additional
information.
<PAGE>
The Trust or each Fund, as appropriate, shall promptly furnish the Custodian
with copies of any updates' amendments or supplements to the foregoing
documents.
In addition, the Trust has delivered or will promptly deliver to the
Custodian, copies of the Resolution(s) of its Trustees and all amendments or
supplements thereto, properly certified or authenticated, designating certain
officers or employees of each such Fund who will have continuing authority to
certify to the Custodian: (a) the names, titles, signatures and scope of
authority of all officers and employees authorized to give Instructions or any
other notice, request, direction, instruction, certificate or instrument on
behalf of each Fund, and (b) the names, titles and signatures of those persons
authorized to countersign or confirm Special Instructions on behalf of each Fund
(in both cases collectively, the "Authorized Persons" and individually, an
"Authorized Person"). Such Resolutions and certificates many be accepted and
relied upon by the Custodian as conclusive evidence of the facts set forth
therein and shall be considered to be in full force and effect until delivery to
the Custodian of a similar Resolution or certificate to the contrary. Upon
delivery of a certificate which deletes or does not include the name(s) of a
person previously authorized to give Instructions or to countersign or confirm
Special Instructions, such persons shall no longer be considered an Authorized
Person. Unless the resolution and certificate specifically limit the authority
of an Authorized Person to specific matters or require that the approval of
anyone else will first have been obtained, the Custodian will be under no
obligation to inquire into the right of the person giving such Instructions or
Special Instructions to do so. Notwithstanding any of the foregoing, no
Instructions or Special Instructions received by the Custodian from a Fund will
be deemed to authorize or permit any director, trustee, officer, employee, or
agent of such Fund to withdraw any of the Assets of such Fund upon the mere
receipt of such authorization, Special Instructions or Instructions from such
director, trustee, officer, employee or agent.
4. POWERS AND DUTIES OF CUSTODIAN AND DOMESTIC SUBCUSTODIAN.
Except for Assets held by any Subcustodian appointed pursuant to Section
5(b) of this Agreement, the Custodian shall have and perform the powers and
duties hereinafter set forth in this Section 4. For purposes of this Section 4
all references to powers and duties of the "Custodian" shall also refer to any
Domestic Subcustodian appointed pursuant to Section 5(a).
(a) Safekeeping.
The Custodian will keep safely the Assets of each Fund which are
delivered to it from time to time. The Custodian shall not be responsible for
any property of a Fund held or received by such Fund and not delivered to the
Custodian.
(b) Manner of Holding Securities.
(1) The Custodian shall at all times hold Securities of
<PAGE>
each Fund either: (i) by physical possession of the share certificates or other
instruments representing such Securities in registered or bearer form; or (ii)
in book-entry form by a Securities System (as hereinafter defined) in accordance
with the provisions of subparagraph (3) below.
(2) The Custodian may hold registrable portfolio Securities which have
been delivered to it in physical form, by registering the same in the name of
the appropriate Fund or its nominee, or in the name of the Custodian or its
nominee, for whose actions such Fund and Custodian, respectively, shall be fully
responsible. Upon the receipt of Instructions, the Custodian shall hold such
Securities in street certificate form, so called, with or without any indication
of fiduciary capacity. However, unless it receives Instructions to the contrary,
the Custodian will register all such portfolio Securities in the name of the
Custodian's authorized nominee. All such Securities shall be held in an account
of the Custodian containing only assets of the appropriate Fund or only assets
held by the Custodian as a fiduciary, provided that the records of the Custodian
shall indicate at all times the Fund or other customer for which such Securities
are held in such accounts and the respective interests therein.
(3) The Custodian may deposit and/or maintain domestic Securities
owned by a Fund in, and each Fund hereby approves use of: (a) The Depository
Trust Company; (b) The Participants Trust Company; and (c) any book-entry system
as provided in (i) Subpart O of Treasury Circular No. 300, 31 CFR 306.115, (ii)
Subpart B of Treasury Circular Public Debt Series No. 27-76, 31 CFR 350.2, or
(iii) the book-entry regulations of federal agencies substantially in the form
of 31 CFR 306.115. Upon the receipt of Special Instructions, the Custodian may
deposit and/or maintain domestic Securities owned by a Fund in any other
domestic clearing agency registered with the Securities and Exchange Commission
("SEC") under Section 17A of the Securities Exchange Act of 1934 (or as may
otherwise be authorized by the SEC to serve in the capacity of depository or
clearing agent for the Securities or other assets of investment companies) which
acts as a Securities depository. Each of the foregoing shall be referred to in
this Agreement as a "Securities System", and all such Securities Systems shall
be listed on the attached Appendix A. Use of a Securities System shall be in
accordance with applicable Federal Reserve Board and SEC rules and regulations,
if any, and subject to the following provisions:
(i) The Custodian may deposit the Securities directly or through one
or more agents or Subcustodians which are also qualified to act
as custodians for investment companies.
(ii) The Custodian shall deposit and/or maintain the Securities in a
Securities System, provided that such Securities are represented
in an account ("Account") of the Custodian in the Securities
System that includes only assets held by the Custodian as a
fiduciary, custodian or otherwise for customers.
<PAGE>
(iii)The books and records of the Custodian shall at all times
identify those Securities belonging to any one or more Funds
which are maintained in a Securities System.
(iv) The Custodian shall pay for Securities purchased for the account
of a Fund only upon (a) receipt of advice from the Securities
System that such Securities have been transferred to the Account
of the Custodian in accordance with the rules of the Securities
System, and (b) the making of an entry on the records of the
Custodian to reflect such payment and transfer for the account of
such Fund. The Custodian shall transfer Securities sold for the
account of a Fund only upon (a) receipt of advice from the
Securities System that payment for such Securities has been
transferred to the Account of the Custodian in accordance with
the rules of the Securities System, and (b) the making of an
entry on the records of the Custodian to reflect such transfer
and payment for the account of such Fund. Copies of all advices
from the Securities System relating to transfers of Securities
for the account of a Fund shall be maintained for such Fund by
the Custodian. The Custodian shall deliver to a Fund on the next
succeeding business day daily transaction reports which shall
include each day's transactions in the Securities System for the
account of such Fund. Such transaction reports shall be delivered
to such Fund or any agent designated by such Fund pursuant to
Instructions, by computer or in such other manner as such Fund
and Custodian may agree.
(v) The Custodian shall promptly provide the Funds with reports
obtained by the Custodian or any Subcustodian with respect to a
Securities System's accounting system, internal accounting
control and procedures for safeguarding Securities deposited in
the Securities Systems. (vi) Upon receipt of Special
Instructions, the Custodian shall terminate the use of any
Securities System on behalf of a Fund as promptly as practicable
and shall take all actions reasonably practicable to safeguard
the Securities of such Fund maintained with such Securities
System.
(c) Free Delivery of Assets.
Notwithstanding any other provision of this Agreement, the Custodian,
upon receipt of Special Instructions, will undertake to make free delivery of
Assets, provided such Assets are on hand and available, in connection with a
Fund's transactions and to transfer such Assets to such broker, dealer,
Subcustodian, bank, agent, Securities System or otherwise as specified in such
Special Instructions.
<PAGE>
(d) Exchange of Securities.
Upon receipt of Instructions, the Custodian will exchange portfolio
Securities held by it for a Fund for other Securities or cash paid in connection
with any reorganization, recapitalization, merger, consolidation, or conversion
of convertible Securities, and will deposit any such Securities in accordance
with the terms of any reorganization or protective plan.
Without Instructions, the Custodian is authorized to exchange
Securities held by it in temporary form for Securities in definitive form, to
surrender Securities for transfer into a name or nominee name as permitted in
Section 4(b)(2), to effect an exchange of shares in a stock split or when the
par value of the stock is changed, to sell any fractional shares, and, upon
receiving payment therefor, to surrender bonds or other Securities held by it at
maturity or call, except that the Custodian shall not surrender any convertible
security (except mandatory conversions) held by a Fund without appropriate
Instructions.
(e) Purchases of Assets
<PAGE>
(1) Securities Purchases. In accordance with Instructions, the
Custodian shall, with respect to a purchase of Securities, pay for such
Securities out of monies held for a Fund's account for which the purchase was
made, but only insofar as monies are available therein for such purpose, and
receive the portfolio Securities so purchased. Unless the Custodian has received
Special Instructions to the contrary, such payment will be made only upon
receipt of Securities by the Custodian, a clearing corporation of a national
Securities exchange of which the Custodian is a member, or a Securities System
in accordance with the provisions of Section 4(b)(3) hereof. Notwithstanding the
foregoing, upon receipt of Instructions: (i) in connection with a repurchase
agreement, the Custodian may release funds to a Securities System prior to the
receipt of advice from the Securities system that the Securities underlying such
repurchase agreement have been transferred by book-entry into the Account
maintained with such Securities System by the Custodian, provided that the
Custodian's instructions to the Securities System require that the Securities
System may make payment of such funds to the other party to the repurchase
agreement only upon transfer by book-entry of the Securities underlying the
repurchase agreement into such Account; (ii) in the case of Interest Bearing
Deposits, currency deposits, and other deposits, foreign exchange transactions,
futures contracts or options, pursuant to Sections 4(g), 4(h), 4(l), and 4(m)
hereof, the Custodian may make payment therefor before receipt of an advice of
transaction; and (iii) in the case of Securities as to which payment for the
Security and receipt of the instrument evidencing the Security are under
generally accepted trade practice or the terms of the instrument representing
the Security expected to take place in different locations or through separate
parties, such as commercial paper which is indexed to foreign currency exchange
rates, derivatives and similar Securities, the Custodian may make payment for
such Securities prior to delivery thereof in accordance with such generally
accepted trade practice or the terms of the instrument representing such
Security.
(2) Other Assets Purchased. Upon receipt of Instructions and except as
otherwise provided herein, the Custodian shall pay for and receive other Assets
for the account of a Fund as provided in Instructions.
(f) Sales of Assets.
(1) Securities Sold. In accordance with Instructions, the Custodian
will, with respect to a sale, deliver or cause to be delivered the Securities
designated as sold to the broker or other person specified in the Instructions
relating to such sale. Unless the Custodian has received Special Instructions to
the contrary, such delivery shall be made only upon receipt of payment therefor
in the form of: (a) cash, certified check' bank cashier's check, bank credit, or
bank wire transfer; (b) credit to the account of the Custodian with a clearing
corporation of a national Securities exchange of which the Custodian is a
member; or (c) credit to the Account of the Custodian with a Securities System,
in accordance with the provisions of Section 4(b)(3) hereof. Notwithstanding the
foregoing, Securities held in physical form may be delivered and paid for in
accordance with ,street delivery custom" to a broker or its clearing agent,
against delivery
<PAGE>
to the Custodian of a receipt for such Securities, provided that the Custodian
shall have taken reasonable steps to ensure prompt collection of the payment
for, or return of, such Securities by the broker or its clearing agent, and
provided further that the Custodian shall not be responsible for the selection
of or the failure or inability to perform of such broker or its clearing agent
or for any related loss arising from delivery or custody of such Securities
prior to receiving payment therefor.
(2) Other Assets Sold. Upon receipt of Instructions and except as
otherwise provided herein' the Custodian shall receive payment for and deliver
other Assets for the account of a Fund as provided in Instructions.
(g) Options.
(1) Upon receipt of Instructions relating to the purchase of an option
or sale of a covered call option, the Custodian shall: (a) receive and retain
confirmations or other documents, if any, evidencing the purchase or writing of
the option by a Fund; (b) if the transaction involves the sale of a covered call
option, deposit and maintain in a segregated account the Securities (either
physically or by book-entry in a Securities System) subject to the covered call
option written on behalf of such Fund; and (c) pay, release and/or transfer such
Securities' cash or other Assets in accordance with any notices or other
communications evidencing the expiration, termination or exercise of such
options which are furnished to the Custodian by the Options Clearing Corporation
(the "OCC"), the securities or options exchanges on which such options were
traded, or such other organization as may be responsible for handling such
option transactions.
(2) Upon receipt of Instructions relating to the sale of a naked
option (including stock index and commodity options), the Custodian, the
appropriate Fund and the broker-dealer shall enter into an agreement to comply
with the rules of the OCC or of any registered national securities exchange or
similar organization(s). Pursuant to that agreement and such Fund's
Instructions, the Custodian shall: (a) receive and retain confirmations or other
documents, if any, evidencing the writing of the option; (b) deposit and
maintain in a segregated account, Securities (either physically or by book-entry
in a Securities System), cash and/or other Assets; and (c) pay, release and/or
transfer such Securities, cash or other Assets in accordance with any such
agreement and with any notices or other communications evidencing the
expiration, termination or exercise of such option which are furnished to the
Custodian by the OCC, the securities or options exchange on which such options
were traded, or such other organization as may be responsible for handling such
option transactions.
(3) The appropriate Fund and the broker-dealer shall be responsible
for determining the quality and quantity of assets held in any segregated
account established in compliance with applicable margin maintenance
requirements and the performance of other terms of any option contract.
<PAGE>
(h) Futures Contracts.
Upon receipt of Instructions, the Custodian shall enter into a futures
margin procedural agreement among the appropriate Fund, the Custodian and the
designated futures commission merchant (a "Procedural Agreement"). Under the
Procedural Agreement the Custodian shall: (a) receive and retain confirmations,
if any, evidencing the purchase or sale of a futures contract or an option on a
futures contract by such Fund; (b) deposit and maintain in a segregated account
cash, Securities and/or other Assets designated as initial, maintenance or
variation "margin" deposits intended to secure such Fund's performance of its
obligations under any futures contracts purchased or sold, or any options on
futures contracts written by such Fund, in accordance with the provisions of any
Procedural Agreement designed to comply with the provisions of the Commodity
Futures Trading Commission and/or any commodity exchange or contract market
(such as the Chicago Board of Trade), or any similar organization(s), regarding
such margin deposits; and (c) release Assets from and/or transfer Assets into
such margin accounts only in accordance with any such Procedural Agreements. The
appropriate Fund and such futures commission merchant shall be responsible for
determining the type and amount of Assets held in the segregated account or paid
to the broker-dealer in compliance with applicable margin maintenance
requirements and the performance of any futures contract or option on a futures
contract in accordance with its terms.
(i) Segregated Accounts.
Upon receipt of Instructions, the Custodian shall establish and
maintain on its books a segregated account or accounts for and on behalf of a
Fund, into which account or accounts may be transferred Assets of such Fund,
including Securities maintained by the Custodian in a Securities System pursuant
to Paragraph (b)(3) of this Section 4, said account or accounts to be maintained
(i) for the purposes set forth in Sections 4(g), 4(h) and 4(n) and (ii) for the
purpose of compliance by such Fund with the procedures required by the SEC
Investment Company Act Release Number 10666 or any subsequent release or
releases relating to the maintenance of segregated accounts by registered
investment companies, or (iii) for such other purposes as may be set forth, from
time to time, in Special Instructions. The Custodian shall not be responsible
for the determination of the type or amount of Assets to be held in any
segregated account referred to in this paragraph, or for compliance by the Fund
with required procedures noticed in (ii) above.
(j) Depositary Receipts.
Upon receipt of Instructions, the Custodian shall surrender or cause
to be surrendered Securities to the depositary used for such Securities by an
issuer of American Depositary Receipts, Global Depository Receipts or European
Depositary Receipts (hereinafter referred to, collectively, as "ADRs"), against
a written receipt therefor adequately describing such Securities and written
evidence satisfactory to the Custodian that the depositary has received
<PAGE>
instructions to issue ADRs with respect to such Securities in the name of the
Custodian or a nominee of the Custodian, for delivery in accordance with such
instructions.
Upon receipt of Instructions, the Custodian shall surrender or cause
to be surrendered ADRs to the issuer thereof, against a written receipt therefor
adequately describing the ADRs surrendered and written evidence satisfactory to
the Custodian that the issuer of the ADRs has received instructions to cause its
depository to deliver the Securities underlying such ADRs in accordance with
such instructions.
(k) Corporate Actions, Put Bonds, Called Bonds, Etc.
Upon receipt of Instructions, the Custodian shall: (a) deliver
warrants, puts, calls, rights or similar Securities to the issuer or trustee
thereof (or to the agent of such issuer or trustee) for the purpose of exercise
or sale, provided that the new Securities, cash or other Assets, if any,
acquired as a result of such actions are to be delivered to the Custodian; and
(b) deposit Securities upon invitations for tenders thereof, provided that the
consideration for such Securities is to be paid or delivered to the Custodian,
or the tendered Securities are to be returned to the Custodian.
Notwithstanding any provision of this Agreement to the contrary, the
Custodian shall take all necessary action, unless otherwise directed to the
contrary in Instructions, to comply with the terms of all mandatory or
compulsory exchanges, calls, tenders, redemptions, or similar rights of security
ownership, and shall notify the appropriate Fund of such action in writing by
facsimile transmission or in such other manner as such Fund and Custodian may
agree in writing.
The Fund agrees that if it gives an Instruction for the performance of
an act on the last permissible date of a period established by any optional
offer or on the last permissible date for the performance of such act, the Fund
shall hold the Bank harmless from any adverse consequences in connection with
acting upon or failing to act upon such Instructions unless such adverse
consequences result from the willful misfeasance or bad faith of Custodian, its
employees or agents.
(l) Interest Bearing Deposits.
Upon receipt of Instructions directing the Custodian to purchase
interest bearing fixed term and call deposits (hereinafter referred to,
collectively, as "Interest Bearing Deposits") for the account of a Fund, the
Custodian shall purchase such Interest Bearing Deposits in the name of such Fund
with such banks or trust companies, including the Custodian, any Subcustodian or
any subsidiary or affiliate of the Custodian (hereinafter referred to as
"Banking Institutions"), and in such amounts as such Fund may direct pursuant to
Instructions. Such Interest Bearing Deposits may be denominated in U.S. dollars
or other currencies, as such Fund may determine and direct pursuant to
Instructions. The responsibilities of the Custodian
<PAGE>
to a Fund for Interest Bearing Deposits issued by the Custodian shall be that of
a U.S. bank for a similar deposit. With respect to Interest Bearing Deposits
other than those issued by the Custodian, (a) the Custodian shall be responsible
for the collection of income and the transmission of cash to and from such
accounts; and (b) the Custodian shall have no duty with respect to the selection
of the Banking Institution or for the failure of such Banking Institution to pay
upon demand.
(m) Foreign Exchange Transactions Other than as Principal.
(1) Upon receipt of Instructions, the Custodian shall settle foreign
exchange contracts or options to purchase and sell foreign currencies for spot
and future delivery on behalf of and for the account of a Fund with such
currency brokers or Banking Institutions as such Fund may determine and direct
pursuant to Instructions. Each Fund accepts full responsibility for its use of
third party foreign exchange brokers and for execution of said foreign exchange
contracts and understands that the Fund shall be responsible for any and all
costs and interest charges which may be incurred as a result of the failure or
delay of its third party broker to deliver foreign exchange. The Custodian shall
have no responsibility with respect to the selection of the currency brokers or
Banking Institutions with which a Fund deals or, so long as the Custodian acts
in accordance with Instructions, for the failure of such brokers or Banking
Institutions to comply with the terms of any contract or option.
(2) Notwithstanding anything to the contrary contained herein, upon
receipt of Special Instructions the Custodian may, in connection with a foreign
exchange contract, make free outgoing payments of cash in the form of U.S.
Dollars or foreign currency prior to receipt of confirmation of such foreign
exchange contract or confirmation that the countervalue currency completing such
contract has been delivered or received.
(n) Pledges or Loans of Securities.
(1) Upon receipt of Instructions from a Fund, the Custodian will
release or cause to be released Securities held in custody to the pledgees
designated in such Instructions by way of pledge or hypothecation to secure
loans incurred by such Fund with various lenders including but not limited to
the Custodian; provided, however, that the Securities shall be released only
upon payment to the Custodian of the monies borrowed, except that in cases where
additional collateral is required to secure existing borrowings, further
Securities may be released or delivered, or caused to be released or delivered
for that purpose upon receipt of Special Instructions. Upon receipt of
Instructions, the Custodian will pay, but only from funds available for such
purpose, any such loan upon re-delivery to it of the Securities pledged or
hypothecated therefor and upon surrender of the note or notes evidencing such
loan. In lieu of delivering collateral to a pledgee, the Custodian, on the
receipt of Instructions, shall transfer the pledged Securities to a segregated
account for the benefit of the pledgee.
<PAGE>
(2) Upon receipt of ~, and execution of a separate Securities Lending
Agreement, the Custodian will release Securities held in custody to the borrower
designated in borrowed Instructions and may, except as otherwise provided below,
deliver such Securities prior to the receipt of collateral, if any, for such
borrowing, provided that, in case of loans of Securities held by a Securities
System that are secured by cash collateral, the Custodian's instructions to the
Securities System shall require that the Securities System deliver the
Securities of the appropriate Fund to the borrower thereof only upon receipt of
the collateral for such borrowing. The Custodian shall have no responsibility or
liability for any loss arising from the delivery of securities prior to the
receipt of collateral. Upon receipt of Instructions and the loaned Securities,
the Custodian will release the collateral to the borrower.
(o) Stock Dividends, Rights, Etc.
The Custodian shall receive and collect all stock dividends, rights,
and other items of like nature on behalf of a Fund and, upon receipt of
Instructions, take action with respect to the same as directed in such
Instructions.
(p) Routine Dealings.
The Custodian will, in general, attend to all routine and mechanical
matters in accordance with industry standards in connection with the sale,
exchange, substitution, purchase, transfer, or other dealings with Securities or
other property of each Fund except as may be otherwise provided in this
Agreement or directed from time to time by Instructions or Special Instructions
from any particular Fund. The Custodian may also make payments to itself or
others from the
Assets for disbursements and out-of-pocket expenses incidental to
handling Securities or other similar items relating to its duties under this
Agreement, provided that all such payments shall be accounted for to the
appropriate Fund.
q. Collections.
The Custodian shall (a) collect amounts due and payable to each Fund
with respect to portfolio Securities and other Assets; (b) promptly credit to
the account of each Fund all income and other payments relating to portfolio
Securities and other Assets held by the Custodian hereunder upon Custodian's
receipt of such income or payments or as otherwise agreed in writing by the
Custodian and any particular Fund; (c) promptly endorse and deliver any
instruments required to effect such collection; and (d) promptly execute
ownership and other certificates and affidavits for all federal, state, local
and foreign tax purposes in connection with receipt of income or other payments
with respect to portfolio Securities and other Assets' or in connection with the
transfer of such Securities or other Assets; provided, however, that with
respect to portfolio Securities registered in so-called street name, or physical
Securities with variable interest rates, the Custodian shall use its best
efforts to collect amounts due and payable to any such Fund. The Custodian shall
<PAGE>
notify a Fund in writing by facsimile transmission or in such other manner as
such Fund and Custodian may agree in writing if any amount payable with respect
to portfolio Securities or other Assets is not received by the Custodian when
due. The Custodian shall not be required to institute suit or take other
extraordinary action to enforce collection except upon receipt of Instructions
and being indemnified to its satisfaction against the cost and expense of such
suit or other actions.
(r) Deposit Accounts.
The Custodian will open and maintain one or more special purpose
deposit accounts in the name of the Custodian, on behalf of a Fund, subject only
to draft or order by Custodian upon receipt of Instructions. All monies received
by the Custodian from or for the account of a Fund shall be deposited in said
accounts. Barring events not under the control of the Custodian, at 9:00 a.m.,
New York time, on the second business day after deposit of any check into an
account, the Custodian agrees to make Fed Funds available to a Fund in the
amount of the check. Deposits made by Federal Reserve wire will be available to
such Fund immediately and ACH wires will be available to the Fund on the next
business day. Income earned on the portfolio Securities will be credited to the
Fund's deposit account. The Custodian will be entitled to reverse any credited
amounts where credits have been made and monies are not finally collected. If
monies are collected after such reversal, the Custodian may open and maintain
accounts in its own banking department, or in such other banks or trust
companies as any be designated by it or by the Fund in writing, all such
accounts, however, to be in the name of Custodian, on behalf of a Fund, and
subject only to its draft or order. Funds received and held for the account of
different Funds shall be maintained in separate accounts established for each
Fund
(s) Dividends, Distributions and Redemptions.
To enable each Fund to pay dividends or other distributions to
shareholders of such Fund and to make payment to shareholders who have requested
repurchase or redemption of their shares of such Fund (collectively, the
"Shares"), the Custodian shall release cash or Securities insofar as available.
In the case of cash, the Custodian shall, upon the receipt of Instructions,
transfer funds by check or wire transfer to any account at any bank or trust
company designated by the Fund in such Instructions. In the case of Securities,
the Custodian shall, upon the receipt of Special Instructions, make such
transfer to any entity or account designated by each such Fund in such Special
Instructions.
(t) Shares of a Fund purchased by such Fund.
Whenever any Shares are repurchased or redeemed by a Fund, the Fund or
its agent shall advise the Custodian of the aggregate dollar amount to be paid
for such Shares and shall confirm such advice in writing. Upon receipt of such
advice, the Custodian shall charge such aggregate dollar amount to the account
of the Fund and either deposit the same in the account maintained for purposes
of paying for
<PAGE>
the redemption of Shares or deliver the same in accordance with such advice. The
Custodian shall not have any duty or responsibility to determine that Shares
have been removed from the proper shareholder account or accounts or that the
proper number of Shares have been cancelled and removed from the shareholder
records.
(u) Shares of a Fund purchased from such Fund.
Whenever Shares are purchased from a Fund, the Fund will deposit or
cause to be deposited with the Custodian the amount received for such Shares.
The Custodian shall not have any duty or responsibility to determine that Shares
purchased from a Fund have been added to the proper shareholder account or
accounts or that the proper number of such Shares have been added to the
shareholder records.
(v) Proxies and Notices; Compliance with the Shareholders
Communication Act of 1985.
The Custodian shall deliver or cause to be delivered to the
appropriate Fund all forms of proxies, all notices of meetings, and any other
notices or announcements affecting or relating to Securities owned by such Fund
that are received by the Custodian, any Subcustodian, or any nominee of either
of them, and, upon receipt of Instructions, the Custodian shall execute and
deliver, or cause such Subcustodian or nominee to execute and deliver, such
proxies or other authorizations as may be required. Except as directed pursuant
to Instructions, neither the Custodian nor any Subcustodian or nominee shall
vote upon any such Securities, or execute any proxy to vote thereon, or give any
consent or take any other action with respect thereto.
The Custodian will not release the identity of a Fund to an issuer
which requests such information pursuant to the Shareholder Communication Act of
1985 for the specific purpose of direct communications between such issuer and
the Fund unless such Fund directs the Custodian otherwise in writing.
(w) Books and Records.
The Custodian shall maintain such records relating to its activities
under this Agreement as are required to be maintained by Rule 31a-1 under the
Investment Company Act of 1940 ("the 1940 Act") and to preserve them for the
periods prescribed in Rule 31a-2 under the 1940 Act. These records shall be open
for inspection by duly authorized officers, employees or agents (including
independent public accountants) of the appropriate Fund during normal business
hours of the Custodian.
The Custodian shall provide accountings relating to its activities
under this Agreement as shall be agreed upon by each Fund and the Custodian.
(x) Opinion of Trust's Independent Certified Public Accountants.
<PAGE>
The Custodian shall take all reasonable action as the Trust may
request to obtain from year to year favorable opinions from the Trust's
independent certified public accountants with respect to the Custodian's
activities hereunder and in connection with the preparation of each such Fund's
periodic reports to the SEC and with respect to any other requirements of the
SEC.
(y) Reports by Independent Certified Public Accountants.
The Custodian shall deliver to the Trust a written report prepared by
the Custodian's independent certified public accountants with respect to the
services provided by the Custodian under this Agreement, including, without
limitation, the Custodian's accounting system, internal accounting control and
procedures for safeguarding cash, Securities and other Assets, including cash,
Securities and other Assets deposited and/or maintained in a Securities System
or with a Subcustodian. Such report shall be of sufficient scope and in
sufficient detail as may reasonably be required by the Trust and as may
reasonably be obtained by the Custodian.
(z) Bills and Other Disbursements.
Upon receipt of Instructions, the Custodian shall pay, or cause to be
paid, all bills, statements, or other obligations of a Fund.
5. SUBCUSTODIANS.
From time to time, in accordance with the relevant provisions of this
Agreement, the Custodian may appoint one or more Domestic Subcustodians or
Special Subcustodians (as each are hereinafter defined) to act on behalf of any
one or more Funds. A Domestic Subcustodian, in accordance with the provisions of
this Agreement, may also appoint a Special Subcustodian to act on behalf of any
one or more Funds. For purposes of this Agreement, all Domestic Subcustodians
and Special Subcustodians shall be referred to collectively as "Subcustodians".
(a) Domestic Subcustodians.
The Custodian may, at any time and from time to time, appoint any bank
as defined in Section 2(a)(5) of the 1940 Act or any trust company or other
entity, any of which meet the requirements of a custodian under Section 17(f) of
the 1940 Act and the rules and regulations thereunder, to act for the Custodian
on behalf of any one or more Funds as a Subcustodian for purposes of holding
Assets of such Fund(s) and performing other functions of the Custodian within
the United States (a "Domestic Subcustodian"). Each Fund shall approve in
writing the appointment of the proposed Domestic Subcustodian; and the
Custodian's appointment of any such Domestic Subcustodian shall not be effective
without such prior written approval of the Fund(s). Each such duly approved
Domestic Subcustodian shall be listed on Appendix A attached hereto, as it may
be amended, from time to time.
<PAGE>
(b) Special Subcustodians.
Upon receipt of Special Instructions, the Custodian shall, on behalf
of a Fund, appoint one or more banks, trust companies or other entities
designated in such Special Instructions to act for the Custodian on behalf of
such Fund as a Subcustodian for purposes of: (i) effecting third-party
repurchase transactions with banks, brokers, dealers or other entities through
the use of a common custodian or subcustodian; (ii) providing depository and
clearing agency services with respect to certain variable rate demand note
Securities' (iii) providing depository and clearing agency services with respect
to dollar denominated Securities, and (iv) effecting any other transactions
designated by such Fund in such Special Instructions. Each such designated
subcustodian (hereinafter referred to as a "Special Subcustodian") shall be
listed on Appendix A attached hereto, as it may be amended from time to time. In
connection with the appointment of any Special Subcustodian, the Custodian shall
enter into a subcustodian agreement with the Special Subcustodian in form and
substance approved by the appropriate Fund in Special Instructions. The
Custodian shall not amend any subcustodian agreement entered into with a Special
Subcustodian, or waive any rights under such agreement, except upon prior
approval pursuant to Special Instructions.
(c) Supervision of Subcustodians.
The Custodian shall (i) cause each Domestic Subcustodian and (ii) use
its best efforts to cause each Special Subcustodian to perform all of its
obligations in accordance with the terms and conditions of the subcustodian
agreement under which the Subcustodian serves.
(d) Termination of a Subcustodian.
The Custodian may, at any time in its discretion upon at least 60
days' notice to the appropriate Fund(s), terminate any Subcustodian of such
Fund(s) in accordance with the termination provisions under the applicable
subcustodian agreement, and upon the receipt of Special Instructions, the
Custodian will terminate any Subcustodian in accordance with the termination
provisions under the applicable subcustodian agreement.
6. STANDARD OF CARE.
(a) General Standard of Care.
The Custodian shall hold harmless and indemnify a Fund for all losses,
damages, liabilities and reasonable costs and expenses suffered or incurred by
such Fund resulting from the negligence or willful misfeasance of the Custodian,
its directors, officers, employees, or agents; provided, however, in no event
shall be Custodian be liable for special, indirect or consequential damages
arising under or in connection with this Agreement.
(b) Actions Prohibited by Applicable Law. Events Beyond
<PAGE>
Custodian's Control, Sovereign Risk, Etc.
In no event shall the Custodian or any Domestic Subcustodian incur
liability hereunder if the Custodian or any Subcustodian or Securities System,
or any subcustodian, Securities System, Securities Depository or Clearing Agency
utilized by the Custodian or any such Subcustodian, or any nominee of the
Custodian or any Subcustodian (individually, a person") is prevented, forbidden
or delayed from performing, or omits to perform, any act or thing which this
Agreement provides shall be performed or omitted to be performed, by reason of:
(i) any provision of any present or future law or regulation or other of the
United States of America, or any state thereof, or of any foreign country, or
political subdivision thereof or of any court of competent jurisdiction (and
neither the Custodian nor any other Person shall be obligated to take any action
contrary thereto); or (ii) any event beyond the control of the Custodian or
other Person such as armed conflict, riots, strikes, lockouts, labor disputes,
equipment or transmission failures (unless caused by the negligence or willful
misconduct of the Custodian), natural disasters, or failure of the mails,
transportation, communications or power supply (unless caused by the negligence
or willful misfeasance of Custodian, its agents or employees); or (iii) any
"Sovereign Risk. "A "Sovereign Risk" shall mean nationalization, expropriation,
devaluation, revaluation, confiscation, seizure, cancellation, destruction or
similar action by any governmental authority, de facto or de jure; or enactment,
promulgation, imposition or enforcement by any such governmental authority of
currency restrictions, exchange controls, taxes, levies or other charges
affecting a Fund's Assets; or acts of armed conflict, terrorism, insurrection or
revolution; or any other act or event beyond the Custodian's or such other
Person's control.
(c) Mitigation by Custodian.
Upon the occurrence of any event which causes or may cause any loss,
damage or expense to the Funds, the Custodian shall (i) cause any Domestic
Subcustodian to and (ii) use its best efforts to cause any Special Subcustodian
to, use all commercially reasonable efforts and take all reasonable steps under
the circumstances to mitigate the effects of such event and to avoid continuing
harm to the Funds.
(d) Liability for Past Records.
Neither the Custodian nor any Domestic Subcustodian shall have any
liability in respect of any loss, damage or expense suffered by a Fund, insofar
as such loss, damage or expense arises from the performance of the Custodian or
any Domestic Subcustodian in reliance upon records that were maintained for such
Fund by entities other than the Custodian or any Domestic Subcustodian prior to
the Custodian's employment hereunder.
(d) Advice of Counsel.
The Custodian and all Domestic Subcustodians shall be entitled to
receive and act upon advice of counsel of its own choosing
<PAGE>
and acceptable to the Funds on all matters. The Custodian and all Domestic
Subcustodians shall be without liability for any actions reasonably taken or
omitted in good faith pursuant to the advice of such counsel.
(e) Advice of the Fund and Others.
The Custodian and any Domestic Subcustodian may rely upon the advice
of any Fund and upon statements of such Fund's accountants and other persons
believed by it in good faith to be expert in matters upon which they are
consulted, and neither the Custodian nor any Domestic Subcustodian shall be
liable for any actions taken or omitted, in good faith, pursuant to such advice
or statements.
(f) Instructions Appearing to be Genuine.
The Custodian and all Domestic Subcustodians shall be fully protected
and indemnified in acting as a custodian hereunder upon any Resolutions of the
Trustees, Instructions, Special Instructions, advice, notice request, consent,
certificate, instrument or paper appearing to it to be genuine and to
have been properly executed and shall, unless otherwise specifically provided
herein, be entitled to receive as conclusive proof of any fact or matter
required to be ascertained from any Fund hereunder a certificate signed by any
officer of such Fund authorized to countersign or confirm Special Instructions.
(g) Exceptions from Liability.
Without limiting the generality of any other provisions hereof,
neither the Custodian nor any Domestic Subcustodian shall be under any duty or
obligation to inquire into, nor be liable for:
(i) the validity of the issue of any Securities purchased by or for
any Fund, the legality of the purchase thereof or evidence of
ownership required to be received by any such Fund, or the
propriety of the decision to purchase or amount paid therefor;
(ii) the legality of the sale of any Securities by or for any Fund, or
the propriety of the amount for which the same were sold; or
(iii)any other expenditures, encumbrances of Securities, borrowings
or similar actions with respect to any Fund's Assets;
and may, until notified to the contrary, presume that all Instructions or
SpecialInstructions received by it are not in conflict with or in any way
contrary to any provisions of any the Trust's Declaration of Trust or By-Laws or
votes or proceedings of the shareholders of a Fund or the Trustees of the Trust,
or the Trust's currently effective Registration Statement on file with the SEC.
<PAGE>
7. LIABILITY OF THE CUSTODIAN FOR ACTIONS OF OTHERS.
(a) Domestic Subcustodians
The Custodian shall be liable for the acts or omissions of any
Domestic Subcustodian to the same extent as if such actions or omissions were
performed by the Custodian itself.
(b) Securities Systems, Special Subcustodians. Securities Depositories
and Clearing Agencies
The Custodian shall not be liable to any Fund for any loss, damage or
expense suffered or incurred by such Fund resulting from or occasioned by the
actions or omissions of a Securities System, Special Subcustodian, or Securities
Depository and Clearing Agency unless such loss, damage or expense is caused by,
or results from, the negligence or willful misfeasance of the Custodian.
(c) Defaults or Insolvencies of Brokers, Banks, Etc.
The Custodian shall not be liable for any loss, damage or expense
suffered or incurred by any Fund resulting from or occasioned by the actions,
omissions, neglects, defaults or insolvency of any broker, bank, trust company
or any other person with whom the Custodian may deal (other than any of such
entities acting as a Subcustodian, Securities System or Securities Depository
and Clearing Agency, for whose actions the liability of the Custodian is set out
elsewhere in this Agreement) unless such loss, damage or expense is caused by,
or results from, the negligence or willful misfeasance of the Custodian.
(d) Reimbursement of Expenses.
Each Fund agrees to reimburse the Custodian for all out-of-pocket
expenses incurred by the Custodian in connection with this Agreement, but
excluding salaries and usual overhead expenses.
8. INDEMNIFICATION.
(a) Indemnification by Fund.
Subject to the limitations set forth in this Agreement, each Fund
agrees to indemnify and hold harmless the Custodian and its nominees from all
losses, damages and expenses (including attorneys' fees) suffered or incurred by
the Custodian or its nominee caused by or arising from actions taken by the
Custodian, its employees or agents in the performance of its duties and
obligations under this Agreement, including, but not limited to, any
indemnification obligations undertaken by the Custodian under any relevant
subcustodian agreement; provided, however, that such indemnity shall not apply
to the extent the Custodian is liable under Sections 6 or 7 hereof.
If any Fund requires the Custodian to take any action with respect to
Securities, which action involves the payment of money or
<PAGE>
which may, in the opinion of the Custodian, result in the Custodian or its
nominee assigned to such Fund being liable for the payment of money or incurring
liability of some other form, such Fund, as a prerequisite to requiring the
Custodian to take such action, shall provide indemnity to the Custodian in an
amount and form satisfactory to it.
(b) Indemnification by Custodian.
Subject to the limitations set forth in this Agreement and in addition
to the obligations provided in Sections 6 and 7, the Custodian agrees to
indemnify and hold harmless each Fund from all losses, damages and expenses
suffered or incurred by each such Fund caused by the gross negligence or willful
misfeasance of the Custodian.
9. ADVANCES.
In the event that, pursuant to Instructions, the Custodian or any
Subcustodian, Securities System, or Securities Depository or Clearing Agency
acting either directly or indirectly under agreement with the Custodian (each of
which for purposes of this Section 9 shall be referred to as "Custodian"), makes
any payment or transfer of funds on behalf of any Fund as to which there would
be, at the close of business on the date of such payment or transfer,
insufficient funds held by the Custodian on behalf of any such Fund, the
Custodian may, in its discretion without further Instructions, provide an
advance ("Advance,) to any such Fund in an amount sufficient to allow the
completion of the transaction by reason of which such payment or transfer of
funds is to be made. In addition, in the event the Custodian is directed by
Instructions to make any payment or transfer of funds on behalf of any Fund as
to which it is subsequently determined that such Fund has overdrawn its cash
account with the Custodian as of the close of business on the date of such
payment or transfer, said overdraft shall constitute an Advance. Any Advance
shall be payable by the Fund on behalf of which the Advance was made on demand
by Custodian, unless otherwise agreed by such Fund and the Custodian, and shall
accrue interest from the date of the Advance to the date of payment by such Fund
to the Custodian at a rate agreed upon in writing from time to time by the
Custodian and such Fund. It is understood that any transaction in respect of
which the Custodian shall have made an Advance, including but not limited to a
foreign exchange contract or transaction in respect of which the Custodian is
not acting as a principal, is for the account of and at the risk of the Fund on
behalf of which the Advance was made, and not, by reason of such Advance, deemed
to be a transaction undertaken by the Custodian for its own account and risk.
The Custodian and each of the Funds which are parties to this Agreement
acknowledge that the purpose of Advances is to finance temporarily the purchase
or sale of Securities for prompt delivery in accordance with the settlement
terms of such transactions or to meet emergency expenses not reasonably
foreseeable by a Fund. The Custodian shall promptly notify the appropriate Fund
of any Advance. Such notification shall be sent by facsimile transmission or in
such other manner as such Fund and the Custodian may agree.
<PAGE>
10. COMPENSATION.
The Custodian agrees that it shall not look to the Funds or the Trust
for compensation for its services provided under this Agreement. The Custodian
shall be compensated entirely by Janus Capital Corporation, the Funds'
administrator, pursuant to the Administration Agreement between Janus Capital
Corporation and the Trust dated December 9, 1994, a copy of which has been
provided to the Custodian. Each Fund will pay to the Custodian such compensation
as is agreed to in writing by the Custodian and each such Fund from time to
time. Such compensation, together with all amounts for which the Custodian is to
be reimbursed in accordance with Section 7(e), shall be billed to each such Fund
and paid in cash to the Custodian.
11. POWERS OF ATTORNEY.
Upon request, each Fund shall deliver to the Custodian such proxies,
powers of attorney or other instruments as may be reasonable and necessary or
desirable in connection with the performance by the Custodian or any
Subcustodian of their respective obligations under this Agreement or any
applicable subcustodian agreement.
12. TERMINATION AND ASSIGNMENT.
Any Fund or the Custodian may terminate this Agreement by notice in
writing, delivered or mailed, postage prepaid (certified mail, return receipt
requested) to the other not less than 60 days prior to the date upon which such
termination shall take effect. Upon termination of this Agreement, the
appropriate Fund shall pay to the Custodian such fees as may be due the
Custodian hereunder as well as its reimbursable disbursements, costs and
expenses paid or incurred. Upon termination of this Agreement, the Custodian
shall deliver, at the terminating party's expense, all Assets held by it
hereunder to the appropriate Fund or as otherwise designated by such Fund by
Special Instructions. Upon such delivery, the Custodian shall have no further
obligations or liabilities under this Agreement except as to the final
resolution of matters relating to activity occurring prior to the effective date
of termination.
This Agreement may not be assigned by the Custodian or any Fund
without the respective consent of the other, duly authorized by a resolution by
its Board of Directors or Trustees.
13. ADDITIONAL FUNDS.
An additional Fund or Funds may become a party to this Agreement after
the date hereof by an instrument in writing to such effect signed by such Fund
or Funds and the Custodian. If this Agreement is terminated as to one or more of
the Funds (but less than all of the Funds) or if an additional Fund or Funds
shall become a party to this Agreement, there shall be delivered to each party
an Appendix B or an amended Appendix B, signed by each of the additional Funds
(if any) and each of the remaining Funds as well as the Custodian, deleting or
adding such Fund or Funds, as the case may be. The termination of this Agreement
as to less than all of the Funds
<PAGE>
shall not affect the obligations of the Custodian and the remaining Funds
hereunder as set forth on the signature page hereto and in Appendix B as revised
from time to time.
14. NOTICES
As to each Fund, notices, requests, instructions and other writings
delivered to Janus Investment Fund, 100 Fillmore Street, Suite 300, Denver, CO
80206-4923, postage prepaid, or to such other address as any particular Fund may
have designated to the Custodian in writing, shall be deemed to have been
properly delivered or given to a Fund.
Notices, requests, instructions and other writings delivered to the
Securities Administration Department of the Custodian at its office at 928 Grand
Avenue, Kansas City, Missouri, or mailed postage prepaid, to the Custodian's
Securities Administration Department, Post Office Box 226, Kansas City, Missouri
64141, or to such other addresses as the Custodian may have designated to each
Fund in writing, shall be deemed to have been properly delivered or given to the
Custodian hereunder; provided, however, that procedures for the delivery of
Instructions and Special Instructions shall be governed by Section 2(c) hereof.
15. MISCELLANEOUS.
(a) This Agreement is executed and delivered in the State of
Missouri and shall be governed by the laws of such state.
(b) All of the terms and provisions of this Agreement shall be
binding upon, and inure to the benefit of, and be enforceable by the respective
successors and assigns of the parties hereto.
(c) No provisions of this Agreement may be amended, modified or
waived, in any manner except in writing, properly executed by both parties
hereto; provided, however, Appendix A may be amended from time to time as
Domestic Subcustodians, Special Subcustodians, and Securities Depositories and
Clearing Agencies are approved or terminated according to the terms of this
Agreement.
(d) The captions in this Agreement are included for convenience of
reference only, and in no way define or delimit any of the provisions hereof or
otherwise affect their construction or effect.
(e) This Agreement shall be effective as of the date of execution
hereof.
(f) This Agreement may be executed simultaneously in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
(g) The following terms are defined terms within the meaning of
this Agreement, and the definitions thereof are found in the following sections
of the Agreement:
<PAGE>
Term Section
ADR's 4(j)
Advance 9
Assets 2
Authorized Person 3
Banking Institution 4(1)
Domestic Subcustodian 5(a)
Instruction Z
Interest Bearing Deposit 4(1)
Liability 10
OCC 4(g)(2)
Person 6(b)
Procedural Agreement 4(h)
SEC 4(b)(3)
Securities 2
Securities Depositories and 5(b)
Clearing Agencies
Securities System 4(b)(3)
Shares 4(s)
Sovereign Risk 6(b)
Special Instruction 2
Special Subcustodian 5(c)
Subcustodian 5
1940 Act 4(v)
(h) If any part, term or provision of this Agreement is held to be
illegal, in conflict with any law or otherwise invalid by any court of competent
jurisdiction, the remaining portion or portions shall be considered severable
and shall not be affected, and the rights and obligations of the parties shall
be construed and enforced as if this Agreement did not contain the particular
part, term or provision held to be illegal or invalid.
(i) This Agreement constitutes the entire understanding and
agreement of the parties hereto with respect to the subject matter hereof, and
accordingly supersedes, as of the effective date of this Agreement, any
custodian agreement heretofore in effect between the Fund and the Custodian.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Custody Agreement
to be executed by their respective duly authorized officers.
ATTEST: JANUS INVESTMENT FUND, on behalf of
Janus Money Market Fund,
Janus Government Money Market Fund
and
Janus Tax-Exempt Money Market Fund
By:_____________________________________
Name:___________________________________
Title:__________________________________
ATTEST: UMB BANK. N.A.
By:_____________________________________
Name:___________________________________
Title:__________________________________
<PAGE>
APPENDIX A
CUSTODY AGREEMENT
DOMESTIC SUBCUSTODIANS:
United Missouri Trust Company of New York
SECURITIES SYSTEMS:
Federal Book Entry
Depository Trust Company
Participant's Trust Company
SPECIAL SUBCUSTODIANS:
Bank of New York
Nations Bank of North Carolina
Chemical Bank
Bankers Trust
____________________________________ UMB Bank, n.a.
By:_________________________________ By:_____________________________________
Title:______________________________ Title:__________________________________
Date:_______________________________
____________________________________
By:_________________________________
Title:______________________________
Date:_______________________________
____________________________________
By:_________________________________
Title:______________________________
Date:_______________________________
<PAGE>
APPENDIX B
CUSTODY AGREEMENT
The following open-end management investment companies ("Funds"), each of
which is a separate series of Janus Investment Fund, are hereby made parties to
the Custody Agreement dated _____________, 199_, with UMB Bank, n.a.
("Custodian"), and agree to be bound by all the terms and conditions contained
in said Agreement as of this ___ day of _______________, 1995.
JANUS MONEY MARKET FUND
By:_____________________________________
Title:__________________________________
Address:________________________________
JANUS GOVERNMENT MONEY MARKET FUND
By:_____________________________________
Title:__________________________________
Address:________________________________
JANUS TAX-EXEMPT MONEY MARKET FUND
By:_____________________________________
Title:__________________________________
Address:________________________________
EXHIBIT 9(c)
JANUS INVESTMENT FUND
FORM OF
ADMINISTRATION AGREEMENT
THIS ADMINISTRATION AGREEMENT (the "Agreement") is made this 9th day of
December, 1994, between JANUS INVESTMENT FUND, a Massachusetts business trust
(the "Trust"), on behalf of [Janus Money Market Fund] [Janus Government Money
Market Fund] [Janus Tax-Exempt Money Market Fund] (the "Fund"), a separate
series of the Trust and JANUS CAPITAL CORPORATION, a Colorado corporation
("JCC").
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 of the Trust; and
WHEREAS, the Fund may offer shares in multiple classes representing
interest in the same portfolio of investments but having potentially different
distribution charges, exchange rights and investment minimum requirements (the
"Classes"); and
WHEREAS, the Trust and JCC have entered into a separate agreement for the
provision of investment advisory services; and
WHEREAS, the Trust and JCC deem it mutually advantageous that JCC should
assist the Trustees and officers of the Trust in the administration of the Fund.
NOW, THEREFORE, the parties agree as follows:
Administrative Services. JCC shall furnish or arrange for the following
services to the Fund incidental to its operations and business: provision of
custody, transfer agency, and fund accounting services; provision of shareholder
servicing; provision of office facilities and personnel necessary to carry on
the business of the Fund; preparation and filing of all documents necessary to
obtain and maintain registration and qualification of the shares of each Class
with the Securities and Exchange Commission and state securities commissions;
clerical, recordkeeping and bookkeeping services; preparation of reports for
distribution to shareholders of the Fund; preparation of prospectuses,
statements of additional information and proxy statements for the Fund or any
Class thereof; preparation and filing of the Fund's required tax reports;
preparation of materials for all meetings of the Trustees (as such materials
pertain to a Fund or any Class thereof); preparation and review of contracts to
which the Fund is a party; monitoring and reporting to Fund officers the Fund's
compliance with investment policies and
<PAGE>
restrictions as set forth in the currently effective prospectus and statement of
additional information of the Fund.
Other Services. JCC is hereby authorized to furnish advice and
recommendations with respect to such other aspects of the business and affairs
of the Fund as the Fund shall determine to be desirable.
Obligations of Trust. The Trust shall have the following obligations under
this Agreement:
o to keep JCC continuously and fully informed as to the composition of
the Fund's investment portfolio and the nature of all of its assets
and liabilities from time to time;
o to furnish JCC with a certified copy of any financial statement or
report prepared for the Fund by certified or independent public
accountants and with copies of any financial statements or reports
made to the Fund's shareholders or to any governmental body or
securities exchange;
o to furnish JCC with certified copies of the minutes of any and all
meetings of the Trustees of the Trust, together with any exhibits
presented to the Trustees at such meetings;
o to furnish JCC with any further materials or information which JCC may
reasonably request to enable it to perform its functions under this
Agreement; and
o to compensate JCC for its services and reimburse JCC for its expenses
incurred hereunder in accordance with the provisions hereof.
Compensation. The Fund shall pay JCC for its administrative services a fee
calculated in the manner set forth on Appendix A hereto. For the month during
which this Agreement becomes effective and the month during which it terminates,
however, there shall be an appropriate proration of the fee payable for such
month based on the number of calendar days of such month during which this
Agreement is effective.
Expenses Borne by JCC. Except for those expenses borne by the Trust
pursuant to Section 6 below, JCC shall bear all expenses incurred in connection
with the operation of the Fund.
Expenses Borne by the Trust. The Trust shall bear the following expenses:
any compensation, fees, or reimbursements which the Trust pays to its Trustees
who are not interested persons of JCC ("Independent Trustees"); fees and
expenses of counsel to the Independent Trustees; fees and expenses of
consultants to the Fund; audit expenses; brokerage commissions and all other
expenses in connection with execution of portfolio transactions; interest; all
federal, state and local taxes (including stamp, excise, income and franchise
taxes); expenses of shareholder meetings, including the preparation, printing
and distribution of proxy
<PAGE>
statements, notices and reports to shareholders; any litigation and other
extraordinary expenses.
Termination. This Agreement may be terminated at any time, without penalty,
by the Trustees of the Trust, or by the shareholders of the Trust acting by vote
of at least a majority of its outstanding voting securities (as defined in the
1940 Act), provided in either case that sixty (60) days advance written notice
of termination be given to JCC at its principal place of business. This
Agreement may be terminated by JCC 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.
Term. This Agreement shall continue in effect until June 16, 1996, and for
successive annual periods thereafter unless sooner terminated in accordance with
Section 7 hereof.
Amendments. This Agreement may be amended by the parties only if such
amendment is in writing and signed by the parties to this Agreement.
Allocation of Expenses.
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 each Fund and the other series of the Trust.
The Trustees shall determine the basis for making an appropriate allocation
of the Fund's expenses (other than those directly attributable to a Class)
between each Class of the Fund.
JCC will furnish to the Trustees such information as to the nature and
amounts of the expenses incurred by JCC in performing its obligations under this
Agreement as the Trustees may reasonably require in order to enable the Trustees
to allocate expenses as provided in paragraphs (a) and (b) of this Section 10.
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's Declaration of Trust, as amended from time to
time, is on file in the Office of the Secretary of State of the Commonwealth of
Massachusetts. Such Declaration of Trust describes in detail the respective
responsibilities and limitations on liability of the Trustees, officers and
holders of shares of beneficial interest of the Trust.
Limitation of Liability of JCC. JCC shall not be liable for any error of
judgment or mistake of law, for any loss arising out of this Agreement, 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 12,
"JCC" shall include any affiliate of JCC performing services for the Trust
contemplated hereunder and directors, officers and employees of JCC and such
affiliates.
<PAGE>
Activities of JCC. The services of JCC to the Trust hereunder are not to be
deemed to be exclusive, and JCC 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 JCC as directors, officers and
shareholders of JCC, that directors, officers, employees and shareholders of JCC
are or may become similarly interested in the Trust, and that JCC may become
interested in the Trust as a shareholder or otherwise.
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 CORPORATION
By: ___________________________________
Name: _________________________________
Title: ________________________________
JANUS INVESTMENT FUND
By: ___________________________________
Name: _________________________________
Title: ________________________________
<PAGE>
APPENDIX A
In accordance with Section 4 of this Agreement, the Fund shall compensate JCC
for services provided to each Class of the Fund in accordance with the following
schedule:
I. [JANUS MONEY MARKET FUND - JANUS INSTITUTIONAL MONEY FUND] [JANUS GOVERNMENT
MONEY MARKET FUND - JANUS INSTITUTIONAL GOVERNMENT MONEY FUND] [JANUS TAX-EXEMPT
MONEY MARKET FUND - JANUS INSTITUTIONAL TAX-EXEMPT MONEY FUND] will pay to JCC
for its administrative services a monthly fee, payable on the last day of each
month during which or part of which this Agreement is in effect, of 1/365 of
0.15% of the closing aggregate net asset value of the shares of such Class for
each day of such month.
II. [JANUS MONEY MARKET FUND - INVESTOR SHARES] [JANUS GOVERNMENT MONEY MARKET
FUND - INVESTOR SHARES] [JANUS TAX-EXEMPT MONEY MARKET FUND - INVESTOR SHARES]
will pay to JCC for its administrative services a monthly fee, payable on the
last day of each month during which or part of which this Agreement is in
effect, of 1/365 of 0.50% of the closing aggregate net asset value of the shares
of each such Class for each day of such month.
EXHIBIT 10(d)
SULLIVAN & WORCESTER
One Post Office Square
Boston, Massachusetts 02109
(617) 338-2800
Telecopier No. 617-338-2880
TWX: 710-321-1976
August 6, 1992
Janus Investment Fund
100 Fillmore Street, Suite 300
Denver, Colorado 80206
Re: Reorganization of Janus Twenty Fund
Ladies and Gentlemen:
You have requested our opinion as to certain questions of Massachusetts law
applicable to Janus Investment Fund, a Massachusetts trust with transferable
shares (the "Trust" or "you"), relating to the following facts: The trustees of
the Trust (the "Trustees") have voted to amend the Trust's Agreement and
Declaration of Trust, dated February 11, 1986, as theretofore amended (as in
effect before such amendment, the "Declaration", and as so amended, the
"Declaration, as amended") to establish and designate an additional Fund of the
Trust, designated as "Janus Twenty Fund" (the "New Fund"), and to authorize a
Series of shares of beneficial interest representing interests therein (the "New
Shares"), and caused to be filed in the office of the Secretary of State of The
Commonwealth of Massachusetts a certificate of designation (the "Certificate")
setting forth the terms of such amendment. The Trustees have also approved a
proposed Agreement and Plan of Reorganization and Liquidation (the "Plan", and
the transactions called for thereby, the "Reorganization"), under which Janus
Twenty Fund, Inc., a Maryland business corporation (the "Old Fund"), would be
reorganized into the New Fund. Under the Plan, the assets of the Old Fund would
be transferred, subject to all of the liabilities of the Old Fund, to the New
Fund, in exchange for a number of New Shares (the "Reorganization Shares") equal
to the number of shares of the Old Fund then outstanding, after which the
Reorganization Shares would be distributed pro rata to the stockholders of the
Old Fund. Following such distribution, the Old Fund would be dissolved.
You have filed with the Securities and Exchange Commission (the "SEC"),
under the Securities Act of 1933, as amended (the "Securities Act"),
Post-effective Amendment No. 46 (the "Securities Act Amendment"), and under the
Investment Company Act of 1940, as amended, Post-effective Amendment No. 29
(collectively with the Securities Act Amendment, the "Amendments"), to your
<PAGE>
-2-
registration statement on Form N-1A (the "Registration Statement") reflecting
the establishment and designation of the New Fund and the authorization of the
New Shares. The terms of the proposed Reorganization are summarized in the proxy
statement (the "Proxy Statement") which has been filed with the SEC for a
meeting of the stockholders of the Old Fund at which, among other things, the
Plan and the Reorganization will be presented for approval by the stockholders
of the Old Fund, and after which (if such approval is given) the Plan will be
signed by and on behalf of the Trust and the Old Fund, and the transfers of
assets, subject to liabilities, and issuances of Reorganization Shares
contemplated thereby will be made.
We have reviewed the Declaration, the Certificate, the Bylaws of the Trust,
the Proxy Statement, the Plan, the Prospectus and Statement of Additional
Information (the "Prospectus") for the New Fund forming part of the Registration
Statement, as amended by the Amendments, the actions taken by the initial
Trustee of the Trust to organize the Trust, the actions taken by the current
Trustees to designate and establish the New Fund and to authorize the New
Shares, to authorize the execution, delivery and performance of the Plan and the
issuance of the Reorganization Shares pursuant thereto, certificates of officers
of the Trust and of public officials as to matters of fact, and such other
documents and instruments, certified or otherwise identified to our
satisfaction, and such questions of law and fact, as we have considered
necessary or appropriate for purposes of the opinions expressed herein. We have
assumed the genuineness of the signatures on, and the authenticity of, all
documents furnished to us, and the conformity to the originals of documents
submitted to us as copies, certified or otherwise, which facts we have not
independently verified.
Based upon and subject to the foregoing, we hereby advise you that, in our
opinion, under the laws of The Commonwealth of Massachusetts:
1. The Trust is duly organized and validly existing under Massachusetts
laws as a trust with transferable shares of the type commonly called a
Massachusetts business trust.
2. The Certificate was duly authorized by all requisite action of the
Trustees and duly executed by officers of the Trust thereunto duly
authorized, has been filed with the office of the Secretary of State
of The Commonwealth of Massachusetts, and is effective to establish
and designate the New Fund as a separate Fund of the Trust, and no
action of the shareholders of the Trust (the "Shareholders") was
required in such connection.
3. The New Shares have been duly authorized by all requisite action of
the Trustees, and no action of the Shareholders is required in such
connection.
<PAGE>
-3-
4. When issued to the Old Fund in exchange for the assets, subject to the
liabilities, thereof and distributed to the stockholders of the Old
Fund in accordance with the terms of the Plan, the Reorganization
Shares will be legally and validly issued and fully paid shares of
beneficial interest of the Trust, representing interests in the New
Fund, and will be non-assessable, either by the Trust or by the New
Fund.
5. When New Shares are issued by the Trust after consummation of the
Reorganization to persons who purchase such New Shares in the manner,
and for consideration actually received by the Trust of the kinds and
in the amounts, contemplated by the Declaration, as amended, and by
the Registration Statement, as amended by the Amendments, at times at
which the Trust is validly existing as a Massachusetts trust with
transferable shares, the New Fund has not been terminated and the
Certificate has not been amended, and at which the action taken by the
Trustees to authorize the issue thereof has not been amended or
rescinded, such New Shares will be legally and validly issued and
fully paid shares of beneficial interest of the Trust, representing
interests in the New Fund, and will be non-assessable, either by the
Trust or by the New Fund.
With respect to the opinions stated in paragraphs 4 and 5, above, we wish
to point out that the shareholders of a Massachusetts business trust may under
some circumstances be subject to assessment at the instance of creditors to pay
the obligations of such trust in the event that its assets are insufficient for
the purpose.
This letter expresses our opinions as to the provisions of the Declaration
and the laws of The Commonwealth of Massachusetts applying to business trusts
generally, but does not extend to the Massachusetts Securities Act, or to
federal securities or other laws.
We hereby consent to the filing of this opinion with the SEC in connection
with the filing of the Amendments, as an exhibit to the Registration Statement.
In giving such consent, we do not thereby admit that we come within the category
of persons whose consent is required under Section 7 of the Securities Act.
Very truly yours,
/s/ Sullivan & Worcester
SULLIVAN & WORCESTER
EXHIBIT 10(e)
SULLIVAN & WORCESTER
One Post Office Square
Boston, Massachusetts 02109
(617) 338-2800
Telecopier No. 617-338-2880
TWX: 710-321-1976
August 6, 1992
Janus Investment Fund
100 Fillmore Street, Suite 300
Denver, Colorado 80206
Re: Reorganization of Janus Venture Fund
Ladies and Gentlemen:
You have requested our opinion as to certain questions of Massachusetts law
applicable to Janus Investment Fund, a Massachusetts trust with transferable
shares (the "Trust" or "you"), relating to the following facts: The trustees of
the Trust (the "Trustees") have voted to amend the Trust's Agreement and
Declaration of Trust, dated February 11, 1986, as theretofore amended (as in
effect before such amendment, the "Declaration", and as so amended, the
"Declaration, as amended") to establish and designate an additional Fund of the
Trust, designated as "Janus Venture Fund" (the "New Fund"), and to authorize a
Series of shares of beneficial interest representing interests therein (the "New
Shares"), and caused to be filed in the office of the Secretary of State of The
Commonwealth of Massachusetts a certificate of designation (the "Certificate")
setting forth the terms of such amendment. The Trustees have also approved a
proposed Agreement and Plan of Reorganization and Liquidation (the "Plan", and
the transactions called for thereby, the "Reorganization"), under which Janus
Venture Fund, Inc., a Maryland business corporation (the "Old Fund"), would be
reorganized into the New Fund. Under the Plan, the assets of the Old Fund would
be transferred, subject to all of the liabilities of the Old Fund, to the New
Fund, in exchange for a number of New Shares (the "Reorganization Shares") equal
to the number of shares of the Old Fund then outstanding, after which the
Reorganization Shares would be distributed pro rata to the stockholders of the
Old Fund. Following such distribution, the Old Fund would be dissolved.
You have filed with the Securities and Exchange Commission (the "SEC"),
under the Securities Act of 1933, as amended (the "Securities Act"),
Post-effective Amendment No. 47 (the "Securities Act Amendment"), and under the
Investment Company Act of 1940, as amended, Post-effective Amendment No. 30
(collectively with the Securities Act Amendment, the "Amendments"), to your
<PAGE>
-2-
registration statement on Form N-1A (the "Registration Statement") reflecting
the establishment and designation of the New Fund and the authorization of the
New Shares. The terms of the proposed Reorganization are summarized in the proxy
statement (the "Proxy Statement") which has been filed with the SEC for a
meeting of the stockholders of the Old Fund at which, among other things, the
Plan and the Reorganization will be presented for approval by the stockholders
of the Old Fund, and after which (if such approval is given) the Plan will be
signed by and on behalf of the Trust and the Old Fund, and the transfers of
assets, subject to liabilities, and issuances of Reorganization Shares
contemplated thereby will be made.
We have reviewed the Declaration, the Certificate, the Bylaws of the Trust,
the Proxy Statement, the Plan, the Prospectus and Statement of Additional
Information (the "Prospectus") for the New Fund forming part of the Registration
Statement, as amended by the Amendments, the actions taken by the initial
Trustee of the Trust to organize the Trust, the actions taken by the current
Trustees to designate and establish the New Fund and to authorize the New
Shares, to authorize the execution, delivery and performance of the Plan and the
issuance of the Reorganization Shares pursuant thereto, certificates of officers
of the Trust and of public officials as to matters of fact, and such other
documents and instruments, certified or otherwise identified to our
satisfaction, and such questions of law and fact, as we have considered
necessary or appropriate for purposes of the opinions expressed herein. We have
assumed the genuineness of the signatures on, and the authenticity of, all
documents furnished to us, and the conformity to the originals of documents
submitted to us as copies, certified or otherwise, which facts we have not
independently verified.
Based upon and subject to the foregoing, we hereby advise you that, in our
opinion, under the laws of The Commonwealth of Massachusetts:
1. The Trust is duly organized and validly existing under Massachusetts
laws as a trust with transferable shares of the type commonly called a
Massachusetts business trust.
2. The Certificate was duly authorized by all requisite action of the
Trustees and duly executed by officers of the Trust thereunto duly
authorized, has been filed with the office of the Secretary of State
of The Commonwealth of Massachusetts, and is effective to establish
and designate the New Fund as a separate Fund of the Trust, and no
action of the shareholders of the Trust (the "Shareholders") was
required in such connection.
3. The New Shares have been duly authorized by all requisite action of
the Trustees, and no action of the Shareholders is required in such
connection.
<PAGE>
-3-
4. When issued to the Old Fund in exchange for the assets, subject to the
liabilities, thereof and distributed to the stockholders of the Old
Fund in accordance with the terms of the Plan, the Reorganization
Shares will be legally and validly issued and fully paid shares of
beneficial interest of the Trust, representing interests in the New
Fund, and will be non-assessable, either by the Trust or by the New
Fund.
5. When New Shares are issued by the Trust after consummation of the
Reorganization to persons who purchase such New Shares in the manner,
and for consideration actually received by the Trust of the kinds and
in the amounts, contemplated by the Declaration, as amended, and by
the Registration Statement, as amended by the Amendments, at times at
which the Trust is validly existing as a Massachusetts trust with
transferable shares, the New Fund has not been terminated and the
Certificate has not been amended, and at which the action taken by the
Trustees to authorize the issue thereof has not been amended or
rescinded, such New Shares will be legally and validly issued and
fully paid shares of beneficial interest of the Trust, representing
interests in the New Fund, and will be non-assessable, either by the
Trust or by the New Fund.
With respect to the opinions stated in paragraphs 4 and 5, above, we wish
to point out that the shareholders of a Massachusetts business trust may under
some circumstances be subject to assessment at the instance of creditors to pay
the obligations of such trust in the event that its assets are insufficient for
the purpose.
This letter expresses our opinions as to the provisions of the Declaration
and the laws of The Commonwealth of Massachusetts applying to business trusts
generally, but does not extend to the Massachusetts Securities Act, or to
federal securities or other laws.
We hereby consent to the filing of this opinion with the SEC in connection
with the filing of the Amendments, as an exhibit to the Registration Statement.
In giving such consent, we do not thereby admit that we come within the category
of persons whose consent is required under Section 7 of the Securities Act.
Very truly yours,
/s/ Sullivan & Worcester
SULLIVAN & WORCESTER
EXHIBIT 10(f)
SULLIVAN & WORCESTER
One Post Office Square
Boston, Massachusetts 02109
(617) 338-2800
Telecopier No. 617-338-2880
TWX: 710-321-1976
August 6, 1992
Janus Investment Fund
100 Fillmore Street, Suite 300
Denver, Colorado 80206
Re: Reorganization of Janus Flexible Income Fund
Ladies and Gentlemen:
You have requested our opinion as to certain questions of Massachusetts law
applicable to Janus Investment Fund, a Massachusetts trust with transferable
shares (the "Trust" or "you"), relating to the following facts: The trustees of
the Trust (the "Trustees") have voted to amend the Trust's Agreement and
Declaration of Trust, dated February 11, 1986, as theretofore amended (as in
effect before such amendment, the "Declaration", and as so amended, the
"Declaration, as amended") to establish and designate an additional Fund of the
Trust, designated as "Janus Flexible Income Fund" (the "New Fund"), and to
authorize a Series of shares of beneficial interest representing interests
therein (the "New Shares"), and caused to be filed in the office of the
Secretary of State of The Commonwealth of Massachusetts a certificate of
designation (the "Certificate") setting forth the terms of such amendment. The
Trustees have also approved a proposed Agreement and Plan of Reorganization and
Liquidation (the "Plan", and the transactions called for thereby, the
"Reorganization"), under which Janus Flexible Income Fund (the "Old Fund"), a
separate series of Janus Income Series, a Massachusetts business trust with
transferable shares (the "Income Series Trust") would be reorganized into the
New Fund. Under the Plan, the assets of the Old Fund would be transferred,
subject to the liabilities of the Old Fund, to the New Fund, in exchange for a
number of New Shares (the "Reorganization Shares") equal to the number of shares
of the Old Fund then outstanding, after which the Reorganization Shares would be
distributed pro rata to the stockholders of the Old Fund. Following such
distribution, and consummation of a similar transaction involving Janus
Intermediate Government Securities Fund, the Income Series Trust would be
terminated.
You have filed with the Securities and Exchange Commission (the "SEC"),
under the Securities Act of 1933, as amended (the
<PAGE>
-2-
"Securities Act"), Post-effective Amendment No. 46 (the "Securities Act
Amendment"), and under the Investment Company Act of 1940, as amended,
Post-effective Amendment No. 29 (collectively with the Securities Act Amendment,
the "Amendments"), to your registration statement on Form N-1A (the
"Registration Statement") reflecting the establishment and designation of the
New Fund and the authorization of the New Shares. The terms of the proposed
Reorganization are summarized in the proxy statement (the "Proxy Statement")
which has been filed with the SEC for a meeting of the stockholders of the Old
Fund at which, among other things, the Plan and the Reorganization will be
presented for approval by the stockholders of the Old Fund, and after which (if
such approval is given) the Plan will be signed by and on behalf of the Trust
and the Old Fund, and the transfers of assets, subject to liabilities, and
issuances of Reorganization Shares contemplated thereby will be made.
We have reviewed the Declaration, the Certificate, the Bylaws of the Trust,
the Proxy Statement, the Plan, the Prospectus and Statement of Additional
Information (the "Prospectus") for the New Fund forming part of the Registration
Statement, as amended by the Amendments, the actions taken by the initial
Trustee of the Trust to organize the Trust, the actions taken by the current
Trustees to designate and establish the New Fund and to authorize the New
Shares, to authorize the execution, delivery and performance of the Plan and the
issuance of the Reorganization Shares pursuant thereto, certificates of officers
of the Trust and of public officials as to matters of fact, and such other
documents and instruments, certified or otherwise identified to our
satisfaction, and such questions of law and fact, as we have considered
necessary or appropriate for purposes of the opinions expressed herein. We have
assumed the genuineness of the signatures on, and the authenticity of, all
documents furnished to us, and the conformity to the originals of documents
submitted to us as copies, certified or otherwise, which facts we have not
independently verified.
Based upon and subject to the foregoing, we hereby advise you that, in our
opinion, under the laws of The Commonwealth of Massachusetts:
1. The Trust is duly organized and validly existing under Massachusetts
laws as a trust with transferable shares of the type commonly called a
Massachusetts business trust.
2. The Certificate was duly authorized by all requisite action of the
Trustees and duly executed by officers of the Trust thereunto duly
authorized, has been filed with the office of the Secretary of State
of The Commonwealth of Massachusetts, and is effective to establish
and designate the New Fund as a separate Fund of the Trust, and no
action of the shareholders of the Trust (the "Shareholders") was
required in such connection.
<PAGE>
-3-
3. The New Shares have been duly authorized by all requisite action of
the Trustees, and no action of the Shareholders is required in such
connection.
4. When issued to the Old Fund in exchange for the assets, subject to the
liabilities, thereof and distributed to the stockholders of the Old
Fund in accordance with the terms of the Plan, the Reorganization
Shares will be legally and validly issued and fully paid shares of
beneficial interest of the Trust, representing interests in the New
Fund, and will be non-assessable, either by the Trust or by the New
Fund.
5. When New Shares are issued by the Trust after consummation of the
Reorganization to persons who purchase such New Shares in the manner,
and for consideration actually received by the Trust of the kinds and
in the amounts, contemplated by the Declaration, as amended, and by
the Registration Statement, as amended by the Amendments, at times at
which the Trust is validly existing as a Massachusetts trust with
transferable shares, the New Fund has not been terminated and the
Certificate has not been amended, and at which the action taken by the
Trustees to authorize the issue thereof has not been amended or
rescinded, such New Shares will be legally and validly issued and
fully paid shares of beneficial interest of the Trust, representing
interests in the New Fund, and will be non-assessable, either by the
Trust or by the New Fund.
With respect to the opinions stated in paragraphs 4 and 5, above, we wish
to point out that the shareholders of a Massachusetts business trust may under
some circumstances be subject to assessment at the instance of creditors to pay
the obligations of such trust in the event that its assets are insufficient for
the purpose.
This letter expresses our opinions as to the provisions of the Declaration
and the laws of The Commonwealth of Massachusetts applying to business trusts
generally, but does not extend to the Massachusetts Securities Act, or to
federal securities or other laws.
We hereby consent to the filing of this opinion with the SEC in connection
with the filing of the Amendments, as an exhibit to the Registration Statement.
In giving such consent, we do not thereby admit that we come within the category
of persons whose consent is required under Section 7 of the Securities Act.
Very truly yours,
/s/ Sullivan & Worcester
SULLIVAN & WORCESTER
EXHIBIT 10(h)
JANUS GROUP OF MUTUAL FUNDS
100 Fillmore Street, Suite 300
Denver, Colorado 80206-4923
303/333-3863
February 18, 1993
Janus Investment Fund
100 Fillmore Street, Suite 300
Denver, CO 80206-9916
RE: Public Offering of Janus Federal Tax-Exempt Fund Shares and
Janus Mercury Fund Shares of Janus Investment Fund
Gentlemen:
I have acted as counsel for Janus Investment Fund, a Massachusetts business
trust (the "Trust"), in connection with the filing with the Securities and
Exchange Commission of a post-effective amendment to the Trust's registration
statement with respect to the proposed sale of shares of beneficial interest,
$0.01 par value (the "Shares"), of the Janus Federal Tax-Exempt Fund and Janus
Mercury Fund.
I have examined the Trust's Agreement and Declaration of Trust and Bylaws,
as amended, the proceedings of its trustees relating to the authorization,
issuance and proposed sale of the Shares, and such other records and documents
as I have deemed relevant. Based upon such examination, it is my opinion that
upon the issuance and sale of the Shares in the manner contemplated by the
aforesaid registration statement, such Shares will be legally issued, fully paid
and nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the above
referenced registration statement. This opinion is for the exclusive use of the
Trust in connection with the filing of such registration statement with the
Securities and Exchange Commission (and certain state securities commissions)
and is not to be used, circulated, quoted, relied upon or otherwise referred to
by any other person or for any other purpose. This opinion is given as of the
date hereof and I render no opinion and disclaim any obligation to revise or
supplement this opinion based upon any change in applicable law or any factual
matter that occurs or comes to my attention after the date hereof.
Very truly yours,
/s/ David C. Tucker
David C. Tucker
EXHIBIT 10(i)
JANUS FUNDS
P.O. Box 173375
Denver, Colorado 80217-3375
800/525-3713
February 11, 1994
Janus Investment Fund
100 Fillmore Street, Suite 300
Denver, Colorado 80206-9916
Re: Public Offering of Janus Overseas Fund
Gentlemen:
I have acted as counsel for Janus Investment Fund, a Massachusetts business
trust (the "Trust"), in connection with the filing with the Securities and
Exchange Commission of a post-effective amendment to the Trust's registration
statement with respect to the proposed sale of shares of beneficial interest,
$0.01 par value (the "Shares"), of the Janus Overseas Fund.
I have examined the Trust's Agreement and Declaration of Trust and Bylaws,
as amended, the proceedings of its trustees relating to the authorization,
issuance and proposed sale of the Shares, and such other records and documents
as I have deemed relevant. Based upon such examination, it is my opinion that
upon the issuance and sale of the Shares in the manner contemplated by the
aforesaid registration statement, such Shares will be legally issued, fully paid
and nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the
above-referenced registration statement. This opinion is for the exclusive use
of the Trust in connection with the filing of such registration statement with
the Securities and Exchange Commission (and certain state securities
commissions) and is not to be used, circulated, quoted, relied upon or otherwise
referred to by any other person or for any other purpose. This opinion is given
as of the date hereof and I render no opinion and disclaim any obligation to
revise or supplement this opinion based upon any change in applicable law or any
factual matter that occurs or comes to my attention after the date hereof.
Very truly yours,
/s/ Deborah E. Bielicke
Deborah E. Bielicke
DEB:el
EXHIBIT 10(j)
JANUS GROUP OF MUTUAL FUNDS
100 Fillmore Street, Suite 300
Denver, Colorado 80206-4923
303/333-3863
November 22, 1994
Janus Investment Fund
100 Fillmore Street, Suite 300
Denver, Colorado 80206-9916
Re: Public Offering of Janus Money Market Fund,
Janus Government Money Market Fund, and
Janus Tax-Exempt Money Market Fund
Gentlemen:
I have acted as counsel for Janus Investment Fund, a Massachusetts business
trust (the "Trust"), in connection with the filing with the Securities and
Exchange Commission of a post-effective amendment to the Trust's registration
statement with respect to the proposed sale of shares of beneficial interest,
$0.01 par value (the "Shares"), of Janus Money Market Fund, Janus Government
Money Market Fund, and Janus Tax-Exempt Money Market Fund.
I have examined the Trust's Agreement and Declaration of Trust and Bylaws,
as amended, the proceedings of its trustees relating to the authorization,
issuance and proposed sale of the Shares, and such other records and documents
as I have deemed relevant. Based upon such examination, it is my opinion that
upon the issuance and sale of the Shares in the manner contemplated by the
aforesaid post-effective amendment to the Trust's registration statement, such
Shares will be legally issued, fully paid and nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the above
referenced registration statement. This opinion is for the exclusive use of the
Trust in connection with the filing of such post-effective amendment to the
Trust's registration statement with the Securities and Exchange Commission (and
certain state securities commissions) and is not to be used, circulated, quoted,
relied upon or otherwise referred to by any other person or for any other
purpose. This opinion is given as of the date hereof and I render no opinion and
disclaim any obligation to revise or supplement this opinion based upon any
change in applicable law or any factual matter that occurs or comes to my
attention after the date hereof.
Very truly yours,
/s/ David C. Tucker
David C. Tucker
EXHIBIT 10(k)
JANUS FUNDS
P.O. Box 173375
Denver, Colorado 80217-3375
800/525-3713
February 10, 1995
Janus Investment Fund
100 Fillmore Street, Suite 300
Denver, Colorado 80206-9916
Re: Public Offering of Janus Money Market Fund - Institutional Shares;
Janus Government Money Market Fund - Institutional Shares; and
Janus Tax-Exempt Money Market Fund - Institutional Shares
Gentlemen:
I have acted as counsel for Janus Investment Fund, a Massachusetts business
trust (the "Trust"), in connection with the filing with the Securities and
Exchange Commission of a post-effective amendment to the Trust's registration
statement with respect to the proposed sale of a second class of shares of
beneficial interest, $0.01 par value (the "Institutional Shares"), of Janus
Money Market Fund, Janus Government Money Market Fund and Janus Tax-Exempt Money
Market Fund.
I have examined the Trust's Agreement and Declaration of Trust and Bylaws,
as amended, the proceedings of its trustees relating to the authorization,
issuance and proposed sale of the Institutional Shares, and such other records
and documents as I have deemed relevant. Based upon such examination, it is my
opinion that upon the issuance and sale of the Institutional Shares in the
manner contemplated by the aforesaid post-effective amendment to the Trust's
registration statement, such Institutional Shares will be legally issued, fully
paid and nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the above-
referenced registration statement. This opinion is for the exclusive use of the
Trust in connection with the filing of such post-effective amendment to the
Trust's registration statement with the Securities and Exchange Commission (and
certain state securities commissions) and is not to be used, circulated, quoted,
relied upon or otherwise referred to by any other person or for any other
purpose. This opinion is given as of the date hereof and I render no opinion and
disclaim any obligation to revise or supplement this opinion based upon any
change in applicable law or any factual matter that occurs or comes to my
attention after the date hereof.
Very truly yours,
/s/ Deborah E. Bielicke
Deborah E. Bielicke
EXHIBIT 11
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the reference to us under the heading "Independent
Accountants" in the Statement of Additional Information constituting part of
this Post-Effective Amendment No. 81 to the Registration Statement on Form N-1A
of Janus Investment Fund.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Denver, Colorado
June 26, 1997
EXHIBIT 14(a)
IRA
CUSTODIAL AGREEMENT
AND
DISCLOSURE STATEMENT
[LOGO] JANUS FUNDS
<PAGE>
CUSTODIAL AGREEMENT
- --------------------------------------------------------------------------------
INTRODUCTION
The Depositor, by signing the Application, and the Custodian, by accepting the
Application, have established this Individual Retirement Custodial Account
Agreement (the "Agreement") sponsored by Janus Investment Fund. The Application
is a part of this Agreement. The Individual Retirement Custodial Account is
established within the meaning of Section 408 (a) of the Internal Revenue Code
of 1986, as amended, or any successor statute (hereafter referred to as the
"Code"). It is agreed by the Depositor and the Custodian that the terms and
conditions of the Individual Retirement Custodial Account are as stated in this
Agreement, which shall be effective as of the date the Application is accepted
by the Custodian.
5305-A Individual Retirement Custodial Account
ARTICLE I
Contributions
Paragraph 1.1 - The Custodian may accept additional cash contributions on behalf
of the Depositor for a tax year of the Depositor. The total cash contributions
are limited to $2,000 for the tax year unless the contribution is a rollover
contribution described in section 402(c) (but only after December 31, 1992),
403(a)(4), 403(b)(8), 408(d)(3), or an employer contribution to a simplified
employee pension plan as described in section 408(k). Rollover contributions
before January 1, 1993, include rollovers described in section 402(a)(5),
402(a)(6), 402(a)(7), 403(a)(4), 403(b)(8), 408(d)(3), or an employer
contribution to a simplified employee pension plan as described in section
408(k).
ARTICLE II
Nonforfeitable Benefits
Paragraph 2.1 - The Depositor's interest in the balance in the custodial account
is nonforfeitable.
ARTICLE III
Investments
Paragraph 3.1 - No part of the custodial funds may be invested in life insurance
contracts, nor may the assets of the custodial account be commingled with other
property except in a common trust fund or common investment fund (within the
meaning of section 408(a)(5)).
Paragraph 3.2 - No part of the custodial funds may be invested in collectibles
(within the meaning of section 408(m)) except as otherwise permitted by section
408(m)(3) which provides an exemption for certain gold and silver coins and
coins issued under the laws of any state.
ARTICLE IV
Distribution of the Account
Paragraph 4.1 - Notwithstanding any provision of this Agreement to the contrary,
the distribution of the Depositor's interest in the custodial account shall be
made in accordance with the following requirements and shall otherwise comply
with section 408(a)(6) and Proposed Regulations section 1.408-8, including the
incidental death benefit provisions of Proposed Regulations section
1.401(a)(9)-2, the provisions of which are incorporated by reference.
Paragraph 4.2 - Unless otherwise elected by the time distributions are required
to begin to the Depositor under paragraph 4.3, or to the surviving spouse under
paragraph 4.4, other than in the case of a life annuity, life expectancies shall
be recalculated annually. Such election shall be irrevocable as to the Depositor
and the surviving spouse and shall apply to all subsequent years. The life
expectancy of a nonspouse beneficiary may not be recalculated.
Paragraph 4.3 - The Depositor's entire interest in the custodial account must
be, or begin to be, distributed by the Depositor's required beginning date,
(April 1 following the calendar year end in which the Depositor reaches age
701/2). By that date, the Depositor may elect, in a manner acceptable to the
Custodian, to have the balance in the custodial account distributed in:
(a) A single sum payment.
(b) An annuity contract that provides equal or substantially equal
monthly, quarterly, or annual payments over the life of the Depositor.
(c) An annuity contract that provides equal or substantially equal
monthly, quarterly, or annual payments over the joint and last
survivor lives of the Depositor and his or her designated beneficiary.
(d) Equal or substantially equal annual payments over a specified period
that may not be longer than the Depositor's life expectancy.
(e) Equal or substantially equal annual payments over a specified period
that may not be longer than the joint life and last survivor
expectancy of the Depositor and his or her designated beneficiary.
Paragraph 4.4 - If the Depositor dies before his or her entire interest is
distributed to him or her, the entire remaining interest will be distributed as
follows:
(a) If the Depositor dies on or after distribution of his or her interest
has begun, distribution must continue to be made in accordance with
paragraph 4.3.
(b) If the Depositor dies before distribution of his or her interest has
begun, the entire remaining interest will, at the election of the
Depositor or, if the Depositor has not so elected, at the election of
the beneficiary or beneficiaries, either
(i) Be distributed by the December 31 of the year containing the
fifth anniversary of the Depositor's death, or
(ii) Be distributed in equal or substantially equal payments over
the life or life expectancy of the designated beneficiary or
beneficiaries starting by December 31 of the year following
the year of the Depositor's death. If, however, the
beneficiary is the Depositor's surviving spouse, then this
distribution is not required to begin before December 31 of
the year in which the Depositor would have turned age 701/2.
(c) Except where distribution in the form of an annuity meeting the
requirements of section 408(b)(3) and its related regulations has
irrevocably commenced, distributions are treated as having begun on
the Depositor's required beginning date, even though payments may
actually have been made before that date.
(d) If the Depositor dies before his or her entire interest has been
distributed and if the beneficiary is other than the surviving spouse,
no additional cash contributions or rollover contributions may be
accepted in the account.
Paragraph 4.5 - In the case of a distribution over life expectancy in equal or
substantially equal annual payments, to determine the minimum annual payment for
each year, divide the Depositor's entire interest in the custodial account as of
the close of business on December 31 of the preceding year by the life
expectancy of the Depositor (or the joint life and last survivor expectancy of
the Depositor and the Depositor's designated beneficiary, or the life expectancy
of the designated beneficiary, whichever applies). In the case of distributions
under paragraph 4.3, determine the initial life expectancy (or joint life and
last survivor expectancy) using the attained ages of the Depositor and
designated beneficiary as of their birthdays in the year the Depositor reaches
age 701/2. In the case of a distribution in accordance with paragraph
4.4(b)(ii), determine life expectancy using the attained age of the designated
beneficiary as of the beneficiary's birthday in the year distributions are
required to commence.
<PAGE>
CUSTODIAL AGREEMENT
- -------------------------------------------------------------------------------1
Paragraph 4.6 - The owner of two or more individual retirement accounts may use
the "alternative method" described in Notice 88-38, 1988-1 C.B. 524, to satisfy
the minimum distribution requirements described above. This method permits an
individual to satisfy these requirements by taking from one individual
retirement account the amount required to satisfy the requirement for another.
ARTICLE V
Disclosure and Reporting
Paragraph 5.1 - The Depositor agrees to provide the Custodian with information
necessary for the Custodian to prepare any reports required under section 408(i)
and Regulations sections 1.408-5 and 1.408-6.
Paragraph 5.2 - The Custodian agrees to submit reports to the Internal Revenue
Service and the Depositor prescribed by the Internal Revenue Service.
ARTICLE VI
Miscellaneous
Paragraph 6.1 - Notwithstanding any other articles which may be added or
incorporated, the provisions of Articles I through III and this sentence will be
controlling. Any additional articles that are not consistent with section 408(a)
and the related regulations will be invalid.
ARTICLE VII
Amendment
Paragraph 7.1 - This Agreement will be amended from time to time to comply with
the provisions of the Code and related regulations. Other amendments may be made
with the consent of the persons whose signatures appear below.
ARTICLE VIII
Definitions and Other
Paragraph 8.1 - Definitions. The following definitions shall apply to terms used
in this Agreement:
a. "Application" shall mean the IRA Application submitted by the
Depositor to the Custodian.
b. "Code" shall mean the Internal Revenue Code of 1986, as amended,
including any regulations, procedures, rulings, or notices issued
thereunder.
c. "Company" shall mean Janus Investment Fund.
d. "Custodial Account" shall mean the custodial account established under
this Agreement.
e. "Custodian" shall mean Investors Fiduciary Trust Company and any
successor custodian.
f. "Depositor" shall mean the individual establishing this IRA by
completing and signing the Application.
Paragraph 8.2 - Investment of Contributions. Contributions shall be invested in
shares of available series of the Company in accordance with the Depositor's
written instructions in the Application, and with subsequent written
instructions of the Depositor (or, following the death of the Depositor, his or
her beneficiary) in a form acceptable to and filed with the Custodian. By giving
such instructions, the Depositor (or beneficiary, where applicable) will be
deemed to have acknowledged receipt of the then current prospectus for any
shares in which the Depositor (or beneficiary) directs the Custodian to invest
contributions. The Depositor, by making a rollover contribution, as described in
Article I, hereby certifies that the contribution meets all requirements for
rollover contributions. The amount of each contribution shall be applied to the
purchase of such shares at the price and in the manner in which such shares are
then being publicly offered by the Company in accordance with the then current
prospectus, and such shares shall be credited to the Custodial Account. All
dividends and capital gain distributions received on the shares of the fund held
in each Custodial Account shall be reinvested in such shares which shall be
credited to such Custodial Account. If any distribution on shares of the fund
may be received at the election of the shareholder in additional shares or in
cash or other property, the Custodian shall elect to receive such distribution
in additional shares. The Custodian shall not be liable for interest on any cash
balance in the Custodial Account. All Company shares acquired by the Custodian
shall be registered in the name of the Custodian or its registered nominee.
Paragraph 8.3 - Voting with respect to shares. The Custodian shall not vote any
of the shares of a Company mutual fund held in the Custodial Account except in
accordance with written instructions of the Depositor, timely received, in a
form acceptable to the Custodian.
Paragraph 8.4 - Alternative Distribution Methods: Notwithstanding Article IV, a
Depositor may elect in writing in a form acceptable to and filed with the
Custodian, to have the balance in the Custodial Account distributed only in a
lump sum or in substantially equal payments over a period that does not exceed
the Depositor's life expectancy or the joint and last survivor life expectancy
of the Depositor and his or her designated beneficiary. For this purpose, life
expectancies must be determined by using applicable Internal Revenue Service
tables. Such election shall be irrevocable as to the Depositor and the surviving
spouse and shall apply to all subsequent years. The life expectancy of a
nonspouse beneficiary may not be recalculated. To receive an annuity
distribution, a Depositor may roll over a lump sum distribution to purchase an
individual retirement annuity payable in equal or substantially equal payments
over the Depositor's life expectancy or the joint and last survivor life
expectancy of the Depositor and his or her designated beneficiary. The
distribution option should be reviewed in the year the Depositor reaches age
701/2 to make sure the requirements of Code Section 408(a)(6) have been met.
Consistent with paragraph 4.6 of Article IV, the Custodian is not obligated to
make any distribution absent a specific written direction, in a form acceptable
to and filed with the Custodian, from the Depositor or designated beneficiary to
do so.
Paragraph 8.5 - Amendment and Termination. The Depositor may at any time and
from time to time terminate this Agreement in whole or in part by delivering to
the Custodian a signed written notice of such termination, in a form acceptable
to the Custodian. The Depositor and the Custodian delegate to the Company the
right to amend this Agreement (including retroactive amendments) by written
notice to the Custodian and the Depositor. The Depositor shall be deemed to have
consented to any such amendment, provided that (a) no amendment shall cause or
permit any part of the assets of the Custodial Account to be diverted to
purposes other than for the exclusive benefit of the Depositor or his or her
beneficiaries; (b) any amendment which affects the rights, duties or
responsibilities of the Custodian may only be made with the Custodian's consent;
and (c) no amendment shall be made except in accordance with any applicable laws
and regulations affecting this Agreement and the Custodial Account.
Paragraph 8.6 - Resignation or Removal of Custodian. The Custodian may resign at
any time upon thirty (30) days notice in writing to the Depositor and the
Company. Upon such resignation, the Depositor delegates to the Company the
responsibility to appoint a successor custodian under this Agreement. The
Company at any time may remove the Custodian upon 30 days written notice to that
effect in a form acceptable to and filed with the Custodian. Such notice must
include designation of a successor custodian. The successor custodian shall
satisfy the requirements of section 408(h) of the Code. Upon receipt by the
Custodian of written acceptance of such appointment by the successor custodian,
the Custodian shall transfer and pay over to such successor the assets of and
records relating to the Custodial Account. The Custodian is authorized, however,
to reserve such sum of money as it may deem advisable for payment of all its
fees, compensation, costs and expenses, or for payment of any other liability
constituting a charge on or against the assets of the Custodial Account
<PAGE>
CUSTODIAL AGREEMENT
2-------------------------------------------------------------------------------
or on or against the Custodian, and where necessary may liquidate shares in the
Custodial Account for such payments. Any balance of such reserve remaining after
the payment of all such items shall be paid over to the successor custodian. The
Custodian shall not be liable for the acts or omissions of any successor
custodian.
Paragraph 8.7 - Custodian's Annual Fees: The Depositor shall be charged by the
Custodian for its services under this Agreement in such amount as the Custodian
shall establish from time to time. Sufficient shares may be liquidated from the
Custodial Account to pay the fee. The annual fee in effect on the date of this
Agreement is set forth in the Application. A different fee may be substituted at
any time upon written notice to the Depositor. A Depositor who does not consent
to such new fee should terminate this Agreement pursuant to paragraph 8.5 of
Article VIII within 30 days of the notice of the new fee. If no such termination
is made within 30 days of the notice of the new fee, the Depositor will be
deemed to have consented to the new fee.
Paragraph 8.8 - Other Fees and Expenses. Any income or other taxes of any kind
whatsoever that may be levied or assessed upon or with respect to the Custodial
Account or the income thereof, any transfer taxes incurred in connection with
the investment and reinvestment of the assets of the Custodial Account, all
other reasonable administrative expenses incurred by the Custodian with respect
to any such taxes, or with respect to any controversies concerning the Custodial
Account, including, but not limited to, fees for legal services rendered to the
Custodian and related costs, and such reasonable compensation to the Custodian
for acting in that capacity with respect to any such taxes or controversies,
may, in the discretion of the Custodian, be charged against and paid from the
assets of the Custodial Account. Sufficient shares may be liquidated from the
Custodial Account to pay any such taxes, expenses and compensation.
Paragraph 8.9 - Inalienability of Assets: No interest, right or claim in or to
any part of the Custodial Account, nor any assets held therein or benefits
provided hereunder shall be subject to alienation, assignment, garnishment,
attachment, execution or levy of any kind, and any attempt to cause any such
interest, right, claim, assets or benefits to be so subjected shall not be
recognized, except to the extent as may be required by law.
Paragraph 8.10 - Exchange Privilege: With respect to any Company shares held in
the Custodial Account, the Depositor (or beneficiary, where applicable) may,
upon submission of written or oral instructions in a form acceptable to and
filed with the Custodian, cause shares of any fund to be exchanged for shares of
any other fund of the Company meeting the requirements of this Agreement, upon
the terms and within the limitations imposed by the then current prospectus of
the fund of the Company whose shares are acquired in the exchange. By giving
such instructions, the Depositor (or beneficiary) will be deemed to have
acknowledged receipt of such prospectus.
Paragraph 8.11 - Designation of Beneficiary. The Depositor may designate a
beneficiary or change or revoke the designation of a beneficiary, by written
notice in a form acceptable to and filed with the Custodian, prior to the
complete distribution of the balance in the Custodial Account. If the Depositor
has not by the date of his or her death properly designated a beneficiary in
accordance with the preceding sentence, or if no designated beneficiary survives
the Depositor, the Depositor's beneficiary shall be his or her estate. If a
beneficiary dies before receiving his or her entire interest in the Custodial
Account, his or her remaining interest in the Custodial Account shall be paid to
the beneficiary's estate.
Paragraph 8.12 - Responsibility as to Contributions or Distributions. The
Custodian will not under any circumstances be responsible for the timing,
purpose or propriety of any contribution or of any distribution made hereunder,
nor shall the Custodian incur any liability or responsibility for any tax
imposed on account of any such contribution or distribution.
Paragraph 8.13 - Other Limits on Responsibilities of the Custodian. The
Custodian shall not incur any liability or responsibility in taking or omitting
to take any action based on any notice, election, instruction or any written
instrument believed by the Custodian to be genuine and to have been properly
executed. The Custodian shall be under no duty of inquiry with respect to any
such notice, election, instruction or written instrument, but in its discretion
may request any tax waivers, proof of signatures or other evidence which it
reasonably deems necessary for its protection. The Depositor and the successors
of the Depositor including any executor or administrator of the Depositor shall,
to the extent permitted by law, indemnify the Custodian and its successors and
assigns against any and all claims, actions or liabilities of the Custodian to
the Depositor or the successors or beneficiaries of the Depositor whatsoever
(including without limitation all reasonable expenses incurred in defending
against or settlement of such claims, actions or liabilities) which may arise in
connection with this Agreement or the Custodial Account, except those due to the
Custodian's own bad faith, gross negligence or willful misconduct. The Custodian
shall not be under any duty to take any action not specified in this Agreement,
unless the Depositor shall furnish it with instructions in proper form and such
instructions shall have been specifically agreed to by the Custodian, or to
defend or engage in any suit with respect hereto unless it shall have first
agreed in writing to do so and shall have been fully indemnified to its
satisfaction.
Paragraph 8.14 - Notices. All written notices required or permitted to be given
by the Custodian shall be deemed to have been given when sent by mail to the
Depositor at the Depositor's last address of record provided to the Custodian.
All written notices required or permitted to be given to the Custodian shall be
deemed to have been given when received by the Custodian if mailed to the
Custodian at Janus Funds, P.O. Box 173375, Denver, Colorado 80217-3375 or such
other address as the Custodian shall provide to the Depositor from time to time.
Paragraph 8.15 - Timing of Contributions. A contribution is deemed to have been
made on the last day of the preceding taxable year if the contribution is made
by the deadline for filing the Depositor's income tax return (not including
extensions) and if the Depositor designates the contribution as a contribution
for the preceding taxable year in a manner acceptable to the Custodian. However,
shares shall be purchased on the day such contribution is received by the
Custodian. The Custodian will not be liable or responsible for any consequences
of postal delays or delays resulting from an incomplete Application or a
designation made in an unacceptable form. Applications received postmarked after
the deadline will be treated as a contribution for the Depositor's current tax
year. Improperly completed applications will be returned to the sender.
Paragraph 8.16 - Governing Law. This Agreement and the Custodial Account shall
be construed, administered and enforced according to the laws of the State of
Missouri.
Paragraph 8.17 - When Effective. This Agreement shall not become effective until
acceptance of the Application by the Custodian at its principal offices, as
evidenced by a written confirmation to the Depositor.
<PAGE>
DISCLOSURE STATEMENT
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INTRODUCTION
The following information is provided to you in accordance with the requirements
of the Internal Revenue Code (the "Code") and Treasury regulations and should be
reviewed in conjunction with the Individual Retirement Custodial Account
Agreement (the "Custodial Agreement"), the Application for your IRA (the
"Application"), and the prospectus for the Janus mutual funds that are allowable
investments for your IRA. The provisions of the Custodial Agreement, Application
and prospectus govern in any instance where the Disclosure Statement is
incomplete or appears to conflict. This Disclosure Statement reflects the
provisions of the Internal Revenue Code in effect on January 1, 1993. This
Disclosure Statement provides a nontechnical summary of the law. Please consult
with your tax advisor for more complete information and refer to IRS Publication
590, Individual Retirement Arrangements.
I. IRA STATUTORY REQUIREMENTS
An IRA is a trust or custodial account established for the exclusive benefit of
you and your beneficiaries. Current law requires that your IRA agreement be in
writing and that it meet the following requirements:
1. All contributions should be in U.S. dollars and should be drawn on U.S. banks
and, for any taxable year, cannot exceed 100% of your compensation or $2,000,
whichever is less, unless the contribution is a rollover contribution or an
employer contribution to a simplified employee pension plan ("SEP").
2. The custodian or trustee must be a bank or other institution or person that
is approved by the Internal Revenue Service to administer your IRA in accordance
with current tax laws.
3. None of your IRA assets may be invested in life insurance contracts or
commingled with the assets of other people except in a common trust fund or
common investment fund.
4. Your interest in your IRA account is nonforfeitable.
5. Distribution from your IRA must be in accordance with certain minimum
distribution rules, which are explained in Section VII.
II. RIGHT TO REVOKE
You may revoke your IRA at any time within seven days of the time your
Application is signed. To revoke your IRA, mail or deliver a written notice
stating "I hereby elect to revoke my Janus Funds IRA." Sign your name exactly as
it appears on your Application, include your social security number, and mail
the notice to:
Janus Funds
P.O. Box 173375
Denver, Colorado 80217-3375
Your notice will be considered mailed on the date of postmark, or the date of
certification or registration if it is sent by certified or registered mail.
When the Custodian receives the proper notice of revocation, you will be
entitled to a refund of your full IRA contribution, without any adjustment for
expenses or market fluctuations. If your have any questions concerning your
right of revocation, please call 1-800-525-3713.
III. ELIGIBILITY
You may make regular contributions to an IRA if you receive compensation from
employment, earnings from self-employment, or alimony, and you have not reached
age 701/2 by the end of the tax year for which the contribution is made. In
addition, if you are married and file a joint tax return, you may make
contributions to an IRA for your spouse whether or not your spouse receives
compensation. You may make a rollover contribution to an IRA if you have
received an eligible rollover distribution from a qualified retirement plan or
tax-sheltered annuity or an eligible distribution from another IRA and elect
rollover treatment within 60 days. You may also make a trustee-to-trustee
transfer from another IRA. Finally, your employer may contribute to your IRA,
and if your employer sponsors a simplified employee pension ("SEP"), your
employer can make contributions to a SEP/IRA on your behalf.
IV. CONTRIBUTIONS
A. REGULAR CONTRIBUTIONS
You may contribute each year up to $2,000 or 100% of your compensation,
whichever is less, to your IRA. If you also establish a spousal IRA for your
spouse, you may contribute up to $2,250 or 100% of your compensation, if less,
which may be split between the two IRA's as you choose, provided that no more
than $2,000 may be contributed to either your IRA or the spousal IRA. If your
spouse has compensation in excess of $250, you and your spouse can make a larger
total contribution if you each contribute to a regular IRA. If your employer
contributes to your IRA, the contribution is treated as compensation paid to
you, whether or not the contribution is deductible, unless the contribution is
made under a SEP (see below). Compensation for these purposes means wages,
salaries, professional fees, or other amounts derived from or received for
personal services actually rendered. It includes earned income from self
employment and alimony or separate maintenance payments includable in income. It
does not include pension or annuity payments or deferred compensation.
B. Time for Making Regular Contributions
You may make regular contributions to your IRA and/or your spousal IRA anytime
during a year, up to and including the due date for filing your tax return for
the year (without extensions). No regular contributions may be made to an IRA
for the calendar year in which you reach age 701/2 or later years. No regular
contributions to a spousal IRA may be made for years in which your spouse is age
701/2 or older.
C. Deductibility
Regular IRA contributions are fully deductible unless you or your spouse are
active participants in a tax-qualified plan of an employer. If you or your
spouse are active participants in such a plan, then your allowable deduction for
regular IRA contributions is reduced or eliminated if your Adjusted Gross Income
("AGI") exceeds certain levels. (If you file separately and are married but live
apart from your spouse at all times during the year, you will be considered to
be single when applying the following rules regarding deduction limitations.)
The deductible amount is determined as follows:
1. If you (and your spouse) are not active participants in a tax-qualified plan,
any contribution up to the maximum amount is deductible.
2. If you (or your spouse) are an active participant in a tax-qualified plan,
and
(a) your AGI is $25,000 or less ($40,000 for a married couple filing a
joint return and $0 for a married person filing separately), any
contribution up to the maximum amount is deductible;
(b) your AGI is $35,000 or more ($50,000 for a married couple filing a
joint return and $10,000 for a married person filing separately), no
IRA contribution is deductible;
(c) your AGI is between $25,000 and $35,000 ($40,000 and $50,000 for a
married couple filing a joint return and $0 to $10,000 for a married
person filing separately), the deductible amount is reduced. In the
case of a regular IRA, the reduction is $0.20 for each $1.00 of AGI
over $25,000 ($40,000 for a married couple filing a joint return and
$10,000 for a married person filing separately). For a spousal IRA,
the reduction is $0.225 for each $1.00 of AGI over $40,000 if filing
jointly. The limit will not be reduced below $200 unless it is
eliminated entirely.
To the extent that the deductibility of IRA contributions is reduced or
eliminated, then nondeductible contributions may be made to your IRA. Earnings
on all IRA contributions, whether or not the contributions themselves are
deductible, are tax-deferred until receipt. You must designate the amount of
nondeductible IRA contributions when filing your tax return for the year. If you
overstate the amount of your nondeductible contributions you must pay a $100
penalty, unless you can show that such overstatement was due to reasonable
cause. If you fail to report nondeductible IRA contributions you will be subject
to a $50 penalty, unless your failure was due to reasonable cause.
<PAGE>
DISCLOSURE STATEMENT
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D. Rollover Contributions
1. Amounts Eligible for Rollover from Plans
and Tax-Sheltered Annuities
You may make a rollover contribution to your IRA of an "eligible rollover
distribution" from an employer tax-qualified plan (an "employer plan") or a
tax-sheltered annuity (including a 403(b)(7) account). The administrator of the
employer plan or the payor of a distribution from the tax-sheltered annuity
should be able to tell you what portion of your payment is an eligible rollover
distribution. The following types of payments cannot be rolled over:
Non-Taxable Payments. In general, only the "taxable portion" of your payment is
an eligible rollover distribution. If you have made "after-tax" employee
contributions to the plan or annuity, these contributions will be non-taxable
when they are paid to you, and they cannot be rolled over. (After-tax employee
contributions generally are contributions you made from your own pay that were
already taxed.)
Payments Spread Over Long Periods. You cannot roll over a payment if it is part
of a series of equal (or almost equal) payments that are made at least once a
year and that will last for
o your lifetime (or your life expectancy), or
o your lifetime and your beneficiary's lifetime (or life expectancies), or
o a period of ten years or more.
Required Minimum Payments. Beginning in the year you reach age 701/2, a certain
portion of your payment cannot be rolled (or transferred) over because it is a
"required minimum payment" that must be paid to you.
2. Direct Rollover
Generally, payment from an employer plan or a tax-sheltered annuity that is an
"eligible rollover distribution," as described above, will be subject to a
mandatory 20% income tax withholding. However, to avoid the 20% withholding you
can choose to perform a direct rollover. In a direct rollover, the eligible
rollover distribution is paid directly from the plan or tax-sheltered annuity to
your IRA. If you choose a direct rollover, you are not taxed on a payment until
you later take it out of the IRA.
3. Rollover of Plan Payments Paid To You
A payment to you of an eligible rollover distribution from an employer plan or
tax-sheltered annuity is taxed in the year you receive it unless, within 60
days, you roll it over to an IRA (or another plan that accepts rollovers). If
you do not roll it over, special tax rules may apply. If any portion of the
payment to you is an eligible rollover distribution, the payor is required by
law to withhold 20% of that amount. This amount is sent to the IRS as income tax
withholding.
Sixty-Day Rollover Option. If you have an eligible rollover distribution paid to
you, you can still decide to roll over all or part of it to an IRA (or another
employer plan that accepts rollovers). If you decide to roll over, you must make
the rollover within 60 days after you receive the payment. The portion of your
payment that is rolled over will not be taxed until you take it out of the IRA
(or the employer plan).
You can roll over up to 100% of the eligible rollover distribution, including an
amount equal to the 20% that was withheld. If you choose to roll over 100%, you
must find other money within the 60-day period to contribute to the IRA or the
employer plan to replace the 20% that was withheld. (On the other hand, if you
roll over only the 80% that you received, you will be taxed on the 20% that was
withheld).
See the Special Tax Notice Regarding Plan Payments, that must be provided by the
plan administrator or payor of your employer plan or tax-sheltered annuity, for
additional information on the rules governing rollover and taxation of plan
distributions, or consult your tax advisor for more details.
You should maintain a separate IRA account for any rollovers of funds from an
employer plan if you want to preserve your ability to later roll over these
funds and earnings into another employer plan. Similarly, you should maintain a
separate account for any rollover of funds from a tax-sheltered annuity.
You can make a rollover from a tax-qualified plan of your spouse's employer if
you received all or a part of your spouse's share as a result of his or her
death. A spouse or former spouse who is a recipient of a distribution made under
a qualified domestic relations order may roll over all or part of the
distribution.
Because complex rules apply to the distribution and rollover of payments from
employer plans and tax-sheltered annuities, you should seek competent tax advice
whenever you contemplate receiving a distribution from a qualified plan or
tax-sheltered annuity or an IRA funded by a rollover from a qualified plan or
tax-sheltered annuity.
4. Rollovers from Other IRAs
You may also make a rollover contribution of amounts held in another IRA. There
are no limits on the amount of rollover contributions made to an IRA from
another IRA, except you may not roll over (or transfer) the required minimum
amount (described in VII.D.). However, the distribution from the first IRA must
be rolled over within 60 days of receipt and no more than one distribution per
year from an IRA may be rolled over into another IRA.
5. Tax-Deferral on IRA Rollover or
Trustee-to-Trustee Transfer
An effective rollover allows you to postpone paying taxes on the amount
distributed from an employer plan, tax-sheltered annuity or IRA until it is
withdrawn from the recipient IRA. You do not report the distribution as income
and you do not take a deduction for the rollover contribution. Earnings on your
rollover IRA are tax- deferred until receipt. (Similarly, a trustee-to-trustee
transfer is not treated as a distribution and the amount transferred and
earnings are tax-deferred until receipt.)
E. SEP Contributions
If your employer has established a simplified employee pension ("SEP"), your
employer may make contributions to your SEP/IRA. If the SEP contains a salary
reduction arrangement, you may elect to reduce your salary by up to the lesser
of 15% of compensation or $7,000 (indexed); and have that amount contributed to
your SEP/IRA. The maximum SEP contribution, including salary reduction amounts
and employer contributions, is the lesser of 15% of compensation or $30,000. SEP
contributions are not included in your taxable income.
V. EXCESS CONTRIBUTIONS
Amounts contributed to an IRA which exceed the maximum allowable contribution
are treated as "excess contributions" and are subject to a nondeductible 6%
penalty tax for each year in which the excess remains in the IRA. Excess
contributions may be corrected and the 6% penalty tax avoided by withdrawal of
the excess and any earnings thereon before the due date (including extensions)
of the federal income tax return for the tax year for which the excess
contribution was made. No deduction may be taken for the excess contributions
and the earnings must be included in taxable income for the year the
contribution was made. The earnings withdrawn may be subject to a 10% premature
distribution tax if you are under age 591/2. See Section VII.B.
An excess contribution may be withdrawn after the due date of the federal income
tax return (including extensions) with the following consequences:
(a) If your total contribution for the tax year for which the excess
contribution was made is $2,250 or less (or below the limit of your
employer's SEP contribution) the excess contribution may be withdrawn
without being included in income or being subject to the 10% premature
distribution tax. No deduction may be taken for the excess
contribution. Any earnings withdrawn will be includable in income in
the year received as a distribution and will be subject to any 10%
premature distribution tax that may apply.
(b) If your total contribution for the tax year the excess contribution
was made exceeds $2,250 (or, if higher, the limit of your employer's
<PAGE>
DISCLOSURE STATEMENT
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SEP contribution) any excess contribution and any earnings on the
excess withdrawn after the due date for the federal income tax return
(including extensions), will be includable in income in the year
received and will be subject to any 10% premature distribution tax
that may apply. Additionally, no deduction may be taken for the excess
contribution for the year in which it is made.
(c) Any excess contribution withdrawn after the due date for the tax
filing (including extensions) for the year for which the contribution
was made is subject to the 6% penalty tax on the amount of the excess
contribution for the taxable year in which made and each tax year that
it is still in your IRA at the end of the year.
You may also correct an excess contribution to your IRA by treating the excess
amount as contributed to your IRA in a subsequent year to the extent that the
excess, when aggregated with your IRA contribution (if any) for the subsequent
year, does not exceed the maximum amount for that year. You may be entitled to a
deduction for the amount of the excess contribution that is applied in the
subsequent year.
VI. INVESTMENT OF ACCOUNT AND FINANCIAL DISCLOSURE
The assets in your IRA will be invested in Janus mutual fund shares in
accordance with your instructions and Article VIII, paragraphs 8.2 and 8.10 of
the Custodial Agreement.
Growth in the value of your IRA cannot be guaranteed or projected. However, the
income and operating expenses of each allowable investment that you select for
your IRA will affect the value of its shares and, therefore, the value of your
IRA. The Janus Funds prospectus for such shares contains information regarding
current income and expenses of each of these investments. Reasonable fees and
other expenses of maintaining your IRA may be charged to you or your IRA. The
current annual Custodian's fee is set forth in the Application. A new fee may be
substituted from time to time as provided in paragraph 8.7 of the Custodial
Agreement.
VII. DISTRIBUTIONS
A. Taxation of Distribution as Ordinary Income
In general, you must include distributions from your IRA in your gross income
for the year in which the distributions are received. There is a 10% additional
income tax assessed against premature distributions to the extent such
distributions are includable in income, as described in B. below.
You may exclude from your income that portion of a distribution that constitutes
a return of your properly reported nondeductible contributions. The amount of
the distribution excludable from income is the portion that bears the same ratio
to the total distribution that your aggregate nondeductible contributions (not
distributed in prior years) bear to the balance at the end of the year
(calculated after adding back distributions made during the year) of your IRA.
For this purpose, all of your IRAs are treated as a single IRA, and all
distributions from an IRA during a taxable year are to be treated as one
distribution.
In addition, your gross income does not include any distribution from an IRA
that is properly rolled over. Except as provided in D. below, you may roll over
all or any part of property received in a distribution of assets, within 60 days
of receipt, into another IRA or individual retirement annuity, and maintain the
tax-deferred status of such assets. A rollover from an IRA to another may be
made once every twelve months. Also, certain qualifying distributions which were
rolled over into an IRA from employer tax-qualified plans may be rolled over
into another employer tax-qualified plan. (You should seek competent tax advice
regarding these rollovers.)
As explained in Section V, certain distributions of excess contributions are not
included in income. In addition, IRA contributions for a taxable year which do
not exceed the contribution limits for such year may also be withdrawn without
being included in income or being subject to a 10% premature distribution tax,
as long as such contributions and earnings thereon are withdrawn prior to the
due date (including extensions) of your federal income tax return for the tax
year for which the contribution was made. The earnings withdrawn must be
included in taxable income for the year in which the contribution was made and
may be subject to the 10% premature distribution tax.
B. Tax on Premature Distributions
To the extent they are included in income, distributions from your IRA made
before you reach age 591/2 will be subject to a 10% additional income tax (in
addition to being taxable as ordinary income) unless the distribution is subject
to an exception, including, a distribution made on account of your death or
disability, or a distribution that is one of a scheduled series of payments over
your life expectancy or the joint life expectancies of you and your beneficiary.
C. Tax on Excess Distributions
There is a 15% excise tax assessed against annual distributions from tax-favored
retirement plans, including IRAs, which exceed the greater of $150,000 or
$112,500 adjusted after 1988 to reflect cost-of-living increases. To determine
whether you have distributions in excess of this limit, you must aggregate the
amounts of all distributions received by you during the calendar year from all
retirement plans, including IRAs. If you had account balances or accrued
benefits equal to at least $562,500 as of August 1, 1986, you may have a portion
of the excess distributions exempted from the 15% additional tax. Please consult
with you tax advisor for more complete information, including the availability
of favorable elections.
D. Required Minimum Distributions
1. During Your Life
The minimum distribution rules require that for your "701/2 year," and each year
thereafter, you must make withdrawals from your IRA accounts that are at least
equal to the "minimum distribution." Your 701/2 year is the calendar year that
contains the date six months after your 70th birthday.
Generally, you must withdraw an amount equal to at least the minimum
distribution by December 31 of each year. However, for your 701/2 year, you may
wait to withdraw the minimum distribution until April 1 of the following year.
(This means that if you wait to make your withdrawal for the 701/2 year until
April 1 of the following year, your total withdrawal in that year must equal the
minimum distributions for two years - a withdrawal by April 1 that is equal to
the minimum distribution for the 701/2 year and a second withdrawal by December
31 that is equal to the minimum distribution for that year.) In each year
thereafter, you must withdraw the minimum distribution for the year by December
31.
The amount of the minimum distribution is usually determined by dividing the
account balance of your IRA, as of December 31 of the prior year, by a divisor
(determined by Internal Revenue Service actuarial tables) that is based on your
life expectancy or the joint life and last survivor expectancy for you and your
beneficiary. See Article IV of the Custodial Agreement for a more detailed
explanation of how to calculate the minimum distribution. The distributions must
also satisfy the minimum distribution incidental benefit rule, which generally
will require distributions over a period less than the joint and last survivor
expectancy of you and your designated beneficiary unless your beneficiary is
your spouse or is no more than ten years younger than you. The IRS provides
tables for determining the distribution needed to satisfy incidental benefit
requirements.
The minimum distribution required must be calculated separately for each IRA you
own, but the amounts so determined may be totalled and taken from any one or
more of your IRAs.
You will be subject to a 50% excise tax on the amount by which the distribution
you actually received in any year falls short of the minimum distribution
required for the year.
You may take your distribution in:
o a lump sum;
o equal or substantially equal payments over a specified period no longer than
your life expectancy or the joint life and last survivor expectancy of you and
your designated beneficiary.
Also, as described in Section VII.A., you may roll over your lump sum
distribution to purchase an individual retirement annuity payable in equal or
substantially equal payments over your life or the joint and last survivor lives
of you and your designated beneficiary. (See Article IV and paragraph 8.4, of
the Custodial Agreement and IRS Publication 590, Individual Retirement
Arrangements, for a full description of permissible distribution methods.)
<PAGE>
DISCLOSURE STATEMENT
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2. After Your Death
If you die before you reach age 701/2, distribution must be made to your
beneficiary by December 31 of the fifth year following the year of your death
unless, by December 31 of the year following your death, your beneficiary begins
receiving distributions over a period not extending beyond your beneficiary's
life expectancy. When your beneficiary is your spouse, however, distributions
can be postponed until December 31 of the year in which you would have reached
age 701/2, at which time your spouse must take them over a period not extending
beyond his or her life expectancy.
(See Article IV of the Custodial Agreement and IRS Publication 590, Individual
Retirement Arrangements, for a more detailed explanation of how to calculate
your minimum distribution.)
If you die after your required beginning date, the balance in the Custodial
Account must continue to be paid at least as rapidly as under the method of
payment being used prior to your death.
If your beneficiary is your spouse, your beneficiary can elect to treat your IRA
as his or her own IRA.
The minimum distribution required must be calculated separately for each IRA,
but the amounts so determined may be totalled and taken from any one or more
IRAs.
A payee is subject to a 50% excise tax on the amount by which a distribution for
the year falls short of the minimum distribution required.
Your beneficiary may take his or her distribution in:
o a lump sum;
o equal or substantially equal payments over a specified period no longer than
his or her life expectancy.
Also, as described in Section VII.A., a spousal beneficiary may roll over a lump
sum distribution to purchase an individual retirement annuity payable in equal
or substantially equal payments over his or her life expectancy. (See Article IV
and paragraph 8.4, of the Custodial Agreement and IRS Publication 590,
Individual Retirement Arrangements, for a full description of permissible
distribution methods.)
3. Further Information
This explanation only summarizes the minimum distribution rules. Other rules and
exceptions may apply to you that are not discussed in this summary, including
rules which, in some cases, would prevent you from using certain options
described above. You should consult your personal tax advisor or IRS Publication
590, Individual Retirement Arrangements, for more detailed information.
VIII. LOSS OF TAX-EXEMPT STATUS OF IRA
If you engage in any of the prohibited transactions listed in Section 4975 of
the Code (such as any sale, exchange, or leasing of any property between you and
your IRA) or if you take a loan from your IRA, your account will be disqualified
and the entire balance of your account will be treated as if it had been
distributed to you as of the first day of the year in which the prohibited
transaction occurred. The fair market value of your IRA will be included in
income in the year the prohibited transaction takes place and, if you are under
age 591/2 at the time, you may be subject to the 10% penalty tax on premature
distributions. Should you or your beneficiary pledge all or any portion of your
IRA as security for a loan, the portion so pledged will be treated as if
distributed to you, will be included in your income, and may be subject to the
10% premature distribution penalty during the year in which the pledge occurred.
IX. OTHER TAX CONSIDERATIONS
A. Federal Income Tax Withholding
Federal income tax will be withheld on amounts distributed from your IRA unless
you elect not to have withholding apply. Generally, tax will be withheld at a
10% rate. At the time of distribution from your IRA, you will be notified of
your right to elect not to have withholding apply and will be provided with the
appropriate election form. If your IRA distribution is to be delivered outside
of the U.S., you may elect not to have withholding apply only if you certify to
the Custodian that you are not a U.S. citizen residing overseas or a "tax
avoidance expatriate" as described in Section 877 of the Internal Revenue Code.
(The distribution may also be subject to state withholding laws.)
B. Distribution not Eligible for Lump-Sum Averaging
or Capital Gains Treatment
No distribution to you or anyone else from your account can qualify for capital
gains treatment under the federal income tax laws or for the five- or ten-year
averaging available with respect to certain lump sum distributions from other
types of retirement plans. The distribution is taxed to the person receiving it
as ordinary income.
C. Gift Tax
If you elect during your lifetime to have all or any part of your account
payable to a beneficiary at or after your death, the election will not subject
you to any gift tax liability.
D. Reporting for Tax Purposes
You must report deductible IRA contributions and distributions on your tax Form
1040 or 1040A for the taxable year in which the contributions or distributions
were made. If you make any nondeductible contributions, you must include the
amount of such nondeductible contributions and the aggregate account balance of
all your IRAs as of the end of the calendar year on Form 8606. Additional
reporting is required in the event that special taxes or penalties described
herein are due. You must file Form 5329 with the IRS for each taxable year in
which the contribution limits are exceeded, a premature distribution takes
place, less than the required minimum amount is distributed from your IRA, or
excess distributions are made.
X. IRS APPROVAL & INFORMATION
This IRA has not been submitted to the IRS for approval as to form because it
incorporates Form 5305-A issued by the IRS. This Disclosure Statement provides
only a summary of the laws governing IRAs. You should consult your personal tax
advisor or IRS Publication 590, Individual Retirement Arrangements, for more
detailed information. This publication is available from your local IRS office
or by calling 1-800-TAX-FORMS.
P.O. Box 173375
Denver, CO 80217-3375
1-800-525-3713
[LOGO] JANUS FUNDS
Funds distributed by Janus Distributors, Inc. Member NASD. (6/96)
EXHIBIT 14(c)
JANUS 403(b)(7) TAX-SHELTERED CUSTODY AGREEMENT
The Employer signing the accompanying Application on behalf of the Employee
named in said Application establishes this Custodial Agreement with Investors
Fiduciary Trust Company as authorized by Section 403(b)(7) of the Internal
Revenue Code in order to provide for the Employee's retirement. This Custody
Agreement shall be effective upon acceptance by Investors Fiduciary Trust
Company of its appointment as Custodian as specified in the Application.
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ARTICLE 1 - DEFINITIONS
As used in this Custody Agreement, the following terms shall have the meaning
hereinafter set forth, unless different meaning is plainly required by the
context:
1.01 Account means the Account established hereunder for the benefit of the
Employee.
1.02 Application means the Application by which this Custody Agreement, as may
be amended from time to time, is established by the Employer on behalf of the
Employee. The statements contained in the Application shall be incorporated into
this Custody Agreement.
1.03 Beneficiary means the person or persons (including a trust or estate)
designated in writing by the Employee to receive any benefit vested under this
Custody Agreement in the event of such Employee's death.
1.04 Code means the Internal Revenue Code of 1986, as amended from time to time.
1.05 Custodian means Investors Fiduciary Trust Company or any successor thereto.
1.06 Custody Agreement means this Agreement and the Application, as the same may
be amended from time to time.
1.07 Employee means a person:
(a) who performs services as an Employee directly for the Employer; and
(b) who has entered into a Salary Reduction Agreement with the Employer under
which the Employer will reduce the Employee's salary by the amount specified in
the most recent Salary Reduction Agreement and contribute such amount to the
Account in accordance with this Custody Agreement.
1.08 Employer means the Employer named in the Application, which shall be any
corporation or other entity that is:
(a) exempt from taxation under Section 501(a) of the Code by virtue of
qualification under Section 501(c)(3) of the Code; or
(b) a state, political subdivision of a state, or an agency or instrumentality
of any one of the foregoing, provided the Employee performs services for an
educational organization described in Section 170(b)(1)(A)(ii) of the Code.
1.09 Plan Year means the calendar year.
1.10 Salary Reduction Agreement means the agreement between the Employer and the
Employee pursuant to which the Employer shall reduce the Employee's salary by a
designated amount and periodically contribute such amount to the Account.
1.11 Shares means the Shares of those regulated investment companies whose
investment advisor is Janus Capital Corporation, or its successors, and which
Shares are authorized by the Sponsor for the investment of contributions to the
Account.
1.12 Sponsor means Janus Capital Corporation.
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ARTICLE 2 - ESTABLISHMENT OF ACCOUNT
The Custodian shall open an Account established by the Employer for the benefit
of the Employee. The Employee shall be the beneficial owner of all Shares held
in or credited to the Account.
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ARTICLE 3 - CONTRIBUTIONS
3.1 Receipt of Contributions: All contributions to the Account shall be made in
cash. The Custodian shall accept and hold in the Account such contributions as
it may receive from time to time and shall invest such contributions in the
class(es) of Shares most recently specified by the Employee in accordance with
Article 4.
3.2 Employer Contributions: The Employer shall make contributions to the
Employee's account in accordance with the Salary Reduction Agreement described
in Section 1.10, subject to the limitations in Section 3.5. In addition, the
Employer may make contributions to the Account on behalf of the Employee in
accordance with any retirement plan, fund or program covering the Employee and
established by the Employer.
3.3 Employee Contributions: The Employee may make voluntary after-tax
contributions to the Account. All such contributions shall be separately
maintained and shall not be commingled with Employer contributions.
3.4 Transfers: The Employee or the Employer may transfer, or cause to be
transferred, in cash or Shares, to the Account:
(a) all or a portion of the assets of an annuity contract or another custodial
account established pursuant to Section 403(b) of the Code; or
(b) all or a portion of the assets of an Individual Retirement Account or
Individual Retirement Annuity, provided such assets are attributable solely
to a rollover contribution from one or more such annuity contracts or
custodial accounts.
Similarly, the Employee may arrange for the transfer of all or a portion of the
assets in the Account to an annuity contract or another custodial account
established pursuant to Section 403(b) of the Code, or to an Individual
Retirement Account or Individual Retirement Annuity.
3.5 Contribution Limitations: Annual contributions (excluding amounts
representing rollover contributions from a prior 403(b) plan or Individual
Retirement Account or Annuity) to an Employee's Account may not exceed the
limitations specified in Sections 403(b)(2), 402(g) or 415(c)(1) of the Code
unless an election is made by the Employee under Section 415(c)(4) of the Code.
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ARTICLE 4 - INVESTMENT OF ACCOUNT ASSETS
Each contribution to the Account shall be applied to the purchase of full and
fractional Shares of the class(es) designated in the Application, and shall be
credited to and held in such Account with a notation as to cost. Contributions
shall continue to be invested in such Shares, unless subsequent contrary
telephone or written instructions, in a form acceptable to the Custodian, to
invest in another class of Shares are received by the Custodian from the
Employee. The Employee may exchange a class of Shares by submitting telephone or
written instructions to the Custodian.
All dividends and capital gains distributions received on the Shares held in the
Account (unless received in additional Shares) shall be reinvested in additional
Shares, which shall be credited to such Account.
If any distribution of such Shares may be received at the election of the
Custodian in additional Shares or in cash, the Custodian shall elect to receive
it in additional Shares. All Shares acquired by the Custodian shall be
registered in the name of the Custodian or its nominee.
<PAGE>
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ARTICLE 5 - DISTRIBUTIONS
5.1 Retirement or Termination Benefits: If an Employee retires or leaves the
employ of the Employer for any reason other than death, the Employer shall make
no further contributions on such Employee's behalf, and the Custodian shall
maintain the Account until it receives written instructions from the Employee to
distribute the Account in accordance with Section 5.3. No distribution shall be
made to the Employee or his beneficiaries before the Employee attains age 59 1/2
unless the Employee or Beneficiary furnishes Custodian written notice and proof
that the Employee has:
(a) become disabled within the meaning of Section 72(m)(7) of the Code;
(b) died;
(c) left the service of the Employer; or
(d) been determined by the Employer to have encountered "financial hardship" as
defined and determined pursuant to Section 403(b)(7)(A)(ii) of the Code and
the regulations promulgated thereunder; PROVIDED, any distribution made due
to financial hardship may not exceed the amount of Employer contributions
made to the Account pursuant to a Salary Reduction Agreement, exclusive of
earnings thereon.
Furthermore, distributions from the Account must comply with the minimum
distribution requirements of Section 403(b)(10) of the Code and the regulations
thereunder.
5.2 Death Benefits: Each Employee shall have the right, by written notice on a
form approved by the Custodian, to designate or to change Beneficiary to receive
the benefit amount payable by reason of the Employee's death. Such benefit
amount shall consist of the balance of the Employee's account, and except as
otherwise herein provided, shall be paid or commenced to be paid to the
Beneficiary within thirty (30) days of the Custodian's receipt of proper
notification of the person(s) entitled thereto. Distribution of any such death
benefit shall be made in any of the forms specified in Section 5.3. The method
of distribution shall be determined by the Beneficiary, provided that in the
event of the Beneficiary's inability or failure to act within a reasonable
period of time, the Custodian shall distribute the Account in a single payment
in kind.
A designation of beneficiary form shall be deemed legally valid only when
submitted to the Custodian fully completed and duly executed. Any such
designation may be revoked by the Employee at any time, and shall be
automatically revoked upon receipt by the Custodian of a subsequent, valid
designation of beneficiary form bearing a later execution date.
If more than one Beneficiary shall have been designated, the amount of the
benefit shall be paid to the Beneficiaries as provided in the designation of
beneficiary form otherwise in equal parts. However, no part of any death benefit
shall be paid to a Beneficiary who is not living at the time of the Employee's
death. If any Beneficiary is then deceased, the parts to which the living
Beneficiaries are entitled shall be increased proportionately. If a Beneficiary
entitled to a distribution under the provisions of this Section 5.2 should die
before receiving full distribution of the amount to which he or she is entitled,
the remaining balance shall be distributed in a single payment to the deceased
Beneficiary's spouse, children, or personal representative, in accordance with
the class distribution and preference order as set forth in the next following
paragraph. In all such cases, the Custodian shall determine the person(s) to be
paid, at its absolute discretion and with full immunity.
If no Beneficiary should survive the Employee, or in the absence of a valid
designation of beneficiary in effect at the time of an Employee's death, the
Custodian shall, upon receipt of a certified copy of the death certificate or
other appropriate evidence of the fact of death satisfactory to the Custodian,
make distribution of the deceased Employee's Account to the person(s) of the
following class and in the following order of preference:
(a) the deceased Employee's spouse, but if no such spouse shall survive the
Employee; then to
(b) the descendants, per stirpes, of the deceased Employee, but if there should
be no descendants; then to
(c) the personal representative of the deceased Employee.
The Custodian may conclusively rely upon the accuracy of all matters reported to
it by any source ordinarily presumed to be knowledgeable respecting the matters
so reported. The Custodian shall have no higher duty than the exercise of good
faith, and shall incur no liability by reason of any action taken in reliance
upon inaccurate or fraudulent information reported by any source assumed to be
reliable, or by reason of incomplete information in its possession at the time
of such distribution.
Any distribution of the Account of an Employee may be made in cash or in Shares
(or partly in each), and shall be made within thirty (30) days following receipt
by the Custodian of information deemed by it sufficient upon which to base such
distribution; PROVIDED, however, that the Custodian shall incur no liability
respecting fluctuations in the value of the Account of a deceased Employee in
the event of a delay occasioned by the Custodian's good faith decision to await
additional evidence or information bearing on the Beneficiary.
Upon full and complete distribution of the Employee's Account pursuant to the
provisions of this Section 5.2, the Custodian shall be fully discharged from all
liability respecting such Account. In the event of reasonable doubt respecting
the proper course of action to be taken, the Custodian may at its sole and
absolute discretion resolve such doubt by judicial determination, which shall be
binding on all parties claiming any interest in the Account of the deceased
Employee. In such event, all court costs, legal expenses, reasonable
compensation for time expended by the Custodian in the performance of its
duties, and other appropriate and pertinent expenses and cost shall be collected
by the Custodian from the deceased Employee's Account.
Notwithstanding any provision elsewhere herein to the contrary, (a) if the
Employee dies on or after the date on which payment from the Account has
commenced but before the entire interest in such Account has been distributed,
the remaining portion of such interest shall be distributed to the Employee's
Beneficiary at least as rapidly as under the method of distribution being used
as of the date of such Employee's death, and (b) if the Employee dies before any
such distribution has commenced, the entire interest of such Employee in the
Account shall be distributed to the Beneficiary within five years of the death
of the Employee; PROVIDED, however that if (i) any portion of the Account is
payable to (or for the benefit of) a designated Beneficiary (within the meaning
of Section 72(s)(4) of the Code), (ii) such portion is to be distributed over
the life of such designated Beneficiary over a period not extending beyond the
life expectancy of such designated Beneficiary (determined as of the date of the
Employee's death), and (iii) such distribution begins no later than one year
after the Employee's death, then the foregoing five-year limitation shall not
apply to such portion of the deceased Account.
5.3 Distribution Options: At the time benefits are paid in accordance with
Section 5.1 or 5.2, the entire value of the Employee's Account shall be
distributed in cash or Shares in any of the following ways as directed by the
Employee, or, in the event of death, by the Beneficiary:
(a) in a lump sum;
(b) in equal or substantially equal installments over a period of time, not
extending beyond the life expectancy of the Employee (or Beneficiary),
determined as of the commencement of such installments; or
(c) in equal or substantially equal installments over a period of time not
extending beyond the joint and last survivor expectancies of the Employee
and his or her spouse, determined as of the commencement of such
installments.
In determining the installments specified in (b) and (c) above, the Employee (or
Beneficiary) shall ensure that the payment amounts will comply with the Code and
regulations promulgated thereunder with respect to required minimum payments in
such cases (with life expectancy payments to include any current earnings on the
unpaid balance of the Employee's Account).
(CONTINUED ON NEXT PAGE)
P.O. Box 173375, Denver, Colorado 80217-3375 [LOGO] JANUS
Funds distributed by Janus Distributors, Inc. Member NASD (1/97)
<PAGE>
JANUS 403(b)(7) TAX-SHELTERED CUSTODY AGREEMENT (Continued)
5.4 Withdrawal of Excess Contributions: If the Custodian should at any time
receive notice from the Employer or Employee that any contribution on behalf of
the Employee exceeded the limitations set forth in Article 3 of this Agreement,
the Custodian shall, as soon as practical after the receipt of such
notification, distribute to such Employee from the Account, Shares representing
the amount of such excess contribution and the net income attributable thereto.
If the excess contribution is not withdrawn before the end of the Employee's
taxable year, the amount of the excess contribution must be included in the
Employee's taxable income and shall be subject to a 6% penalty tax for each
taxable year until the excess is eliminated. Notwithstanding any of the above
provisions, if such excess contribution is not withdrawn before the end of the
Employee's taxable year, the Employee may direct the Custodian to retain the
excess contribution in the Account, providing such excess is used to reduce the
permissible contribution for the current taxable year.
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ARTICLE 6 - THE CUSTODIAN
6.1 Limitations on Custodian's Responsibilities: The Custodian shall not be
responsible in any way for determining the permissible amount of contributions,
the collection of contributions under this Custody Agreement, the purpose or
propriety of any distribution made pursuant to Article 5 hereof, or any other
action or non-action taken at the direction of the Employee, Employer or
Beneficiary. The Employee, Beneficiary, and the executor or administrator of
either of them, as appropriate, shall at all times fully indemnify and save
harmless the Custodian, its successors and assigns, from any liability arising
from distributions so made or actions or non-actions so taken, and from any and
all other liability whatsoever which may arise in connection with this Custody
Agreement, except liability arising from the negligence or willful misconduct of
the Custodian.
The Custodian shall be under no duty to take any action other than as herein
specified with respect to the Account unless the Employee shall furnish the
Custodian with instructions in proper form and such instructions shall have been
specifically agreed to by the Custodian in writing; or to defend or engage in
any suit with respect to the Account unless the Custodian shall first have
agreed in writing to do so and shall have been fully indemnified to the
satisfaction of the Custodian.
The Custodian may conclusively rely upon and
shall be protected in acting upon any written order from the Employer, Employee
or Beneficiary, or any other notice, request, consent, certificate, or other
instrument or paper believed by it to be genuine and to have been properly
executed, and, so long as it acts in good faith, in taking or omitting to take
any other action. No amendment to this Custody Agreement shall place any greater
burden on the Custodian without its written consent.
The Custodian may appoint such agents, attorneys, or other parties and delegate
to such persons such ministerial and limited discretionary duties, including,
but not limited to:
(a) acceptance and investment of contributions;
(b) maintenance of Employee's Account records;
(c) maintenance of Employee's beneficiary designations; and
(d) collection and remittance of Custodian fees.
The Custodian may submit any question arising hereunder or in respect of the
Account to counsel, including its own counsel, and shall be protected in the
acting on the advice of such counsel.
6.2 Reports: The Custodian shall keep accurate and detailed records of all
receipts, investments, disbursements, and other transactions hereunder. The
Custodian shall keep such records, and file with the Internal Revenue Service
such returns and other information concerning the Account, as may be required of
it under the Code and any regulations promulgated thereunder.
The Employee and Custodian shall furnish to each other such information relevant
to the Account as may be required under the Code and any regulations issued, or
forms adopted, by the Treasury Department thereunder.
6.3 Voting and Other Action: The Custodian shall deliver or cause to be
delivered to the Employee all notices, prospectuses, financial statements,
proxies and proxy soliciting materials relating to the Shares held in the
Account. The Custodian shall not vote any Shares held hereunder except in
accordance with the written instructions of the Employee.
6.4 Fee and Expenses: In consideration of its services hereunder, the Custodian
shall receive an annual maintenance fee according to the published fee schedule
which has been delivered to the Employee. Any income taxes or other taxes of any
kind whatsoever that may be levied or assessed upon, or in respect of the
Account, shall be paid from the assets of the Account. Any transfer taxes
incurred in connection with the investment of the assets of the Account, and all
other administrative expenses incurred by the Custodian in the performance of
its duties, including fees for legal services rendered to the Custodian, shall
similarly be paid from the assets of the Account.
The Custodian may change the published fee schedule with respect to Plan Years
beginning at least forty-five (45) days after the Custodian gives the Employee
written notice of such change.
6.5 Resignation or Removal: The Custodian may resign at any time upon thirty
(30) days' notice in writing to the Sponsor, and the Custodian may be removed by
the Sponsor at any time upon thirty (30) days' notice in writing to the
Custodian. Upon such resignation or removal, the Sponsor shall appoint a
successor Custodian, which successor shall be a "bank" as defined in Section
408(n) of the Code.
Upon receipt by the Custodian of written acceptance of such appointment by the
successor Custodian, the Custodian shall transfer and pay over to such successor
the assets of the account and all records pertaining thereto, provided that any
successor Custodian shall agree not to dispose of any such records without the
Custodian's consent. The Custodian is authorized, however, to reserve such sum
of money or Shares as it may deem advisable for payment of all its fees,
compensation, costs, and expenses, or for payment of any liabilities
constituting a charge on or against the assets of the Account or on or against
the Custodian, with any balance of such reserve remaining after the payment of
all such items to be paid over to the successor Custodian. The successor
Custodian shall hold the assets paid over to it under terms similar to those of
this Plan that qualify under Section 403(b) of the Code.
If, within thirty (30) days after the Custodian's resignation or removal, the
Sponsor has not appointed a successor Custodian which has accepted such
appointment, the Custodian may appoint such successor. The Custodian shall not
be liable for the acts or omissions of such successor, whether or not it makes
such appointment.
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ARTICLE 7 - AMENDMENT
The Custody Agreement may at any time and from time to time be amended in whole
or in part by the Sponsor mailing to the Employer and Employee a written copy of
such amendment; provided, however, the Sponsor shall not have the right to amend
the Custody Agreement in such a manner as to: (a) deprive any Employee of any
benefit to which he or she was entitled under the Custody Agreement by reason of
contributions made prior to the amendment, unless such amendment is necessary to
conform the Custody Agreement to, or satisfy the conditions of, any law,
governmental regulation or ruling, and to permit the Custody Agreement and the
Account to meet the requirements of Section 403(b) of the Code or any similar
statute; (b) cause or permit the Account to be diverted to purposes other than
for the exclusive benefit of the Employee or Beneficiary; or (c) cause or permit
any part of the Account to revert to or become the property of the Employer.
<PAGE>
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ARTICLE 8 - TERMINATION OF ACCOUNT
The Custodian may elect to terminate the Account if, within thirty (30) days
after its resignation or removal pursuant to Section 6.5, the Sponsor has not
appointed a successor Custodian which has accepted such appointment.
Upon termination of the Account in any manner provided for in this Article 8 and
in Article 6, this Custody Agreement shall be considered to be rescinded and of
no force and effect, and the Custodian shall be relieved from all further
liability with respect to this Custody Agreement, the Account and all assets
thereof so distributed, and any determination by the Custodian of the mode of
distributing the assets of the Account.
- --------------------------------------------------------------------------------
ARTICLE 9 - MISCELLANEOUS
9.1 Prohibited Diversion: At no time shall it be possible for any part of the
assets of the Account to be used for, or diverted to, purposes other than for
the exclusive benefit of the Employee or the Employee's Beneficiary except as
specifically provided in this Custody Agreement.
9.2 Inalienability of Benefits: Except as provided in Sections 3.4 and 6.4, the
assets of the Account shall be nonforfeitable and non-transferable, and shall
not be subject to the claims of the Employee's creditors or to alienation,
assignment, trustee process, garnishment, attachment, execution or levy of any
kind except by the Custodian for its fees and for the expenses of the Account;
and no attempt to cause such assets to be so subjected shall be recognized
except to such extent as may be required by law or provided for herein;
provided, however, that nothing contained in this Custody Agreement prevents the
Custodian from complying with the provisions of a qualified domestic relations
order (as defined in Section 414(p) of the Code). This Custody Agreement
specifically permits distribution to an alternate payee pursuant to a qualified
domestic relations order at any time, irrespective of whether the Employee has
attained his earliest retirement age (as defined under Section 414(p) of the
Code) under this Custody Agreement. Nothing in this Section 9.2 gives an
Employee a right to receive distribution at a time otherwise not permitted under
this Custody Agreement, nor does it permit the alternate payee to receive a form
of payment not otherwise permitted under this Custody Agreement.
9.3 Taxes: The tax treatment of any contributions to the Account and of any
earnings of the Account depends, among other things, upon the nature of the
Employer, the relationship of the Employee to the Employer, and the amount of
contributions made in any Plan Year to the Account (and to other plans, accounts
or contracts with the benefit of special tax treatment) for the benefit of the
Employee. The Custodian and the Sponsor assume no responsibility with respect to
such matters, nor shall any term or provision of this Custody Agreement be
construed so as to place any such responsibility upon either one of them.
9.4 Condition of Custody Agreement: The Account is established with the intent
that it shall qualify under Section 403(b) of the Code as that section exists at
the time the Account is established. Notwithstanding any other provision
contained in this Custody Agreement, if the Internal Revenue Service determines
that because of some inadequacy in the provisions of this original Account, the
Account initially fails to so qualify, all of the assets of the Account shall be
distributed to the Employee, and the Custody Agreement shall be considered to be
rescinded and of no force and effect, unless such inadequacy is removed by a
retroactive amendment. The Sponsor forthwith shall notify the Custodian in
writing of any determination made with respect to the qualified status of the
Custody Agreement.
9.5 Notices by the Custodian: Any notice from the Custodian to the Employer,
Employee, or Beneficiary provided for in this Custody Agreement shall be
effective if sent by first class mail to such person at the last address on the
Custodian's records.
9.6 Construction: Wherever used in the Custody Agreement, the masculine gender
shall include the feminine gender, and singular shall include the plural, unless
the context indicates otherwise.
9.7 Governing Laws: This Agreement shall be construed and administered in
accordance with the laws of the State of Missouri.
P.O. Box 173375, Denver, Colorado 80217-3375 [LOGO] JANUS
Funds distributed by Janus Distributors, Inc. Member NASD (1/97)
EXHIBIT 17
JANUS INVESTMENT FUND (the "Trust")
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby makes, constitutes,
and appoints Steven R. Goodbarn his true and lawful attorney and agent in his
name, place, and stead on his behalf (a) to sign and cause to be filed
amendments to the registration statement of the Trust under the Securities Act
of 1933, the Investment Company Act of 1940 and the laws and regulations of the
various states, if applicable, and all consents and exhibits thereto; (b) to
withdraw such registration statement or any amendments or exhibits and make
requests for acceleration in connection therewith; (c) to take all other action
of whatever kind or nature in connection with such registration statement, and
all amendments thereto, which said attorney may deem advisable; and (d) to make,
file, execute, amend, and withdraw documents of every kind, and to take other
action of whatever kind he may elect, for the purpose of complying with all laws
relating to the sale of securities of the Trust, hereby ratifying and confirming
all actions of said attorney hereunder, provided that this Power of Attorney is
ratified to be effective by the Trustees with respect to each filing or
withdrawal of such registration statement and all amendments, consents, and
exhibits thereto.
IN WITNESS WHEREOF, the undersigned has hereby set his hand as of this 20th
day of May, 1997.
Signature Title Date
/s/ Thomas H. Bailey Chairman, May 20, 1997
Thomas H. Bailey (Principal Executive Officer)
President and Trustee
EXHIBIT 17
JANUS INVESTMENT FUND (the "Trust")
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby makes, constitutes,
and appoints Thomas H. Bailey and Steven R. Goodbarn, and each of them,
severally, his true and lawful attorneys and agents in his name, place, and
stead on his behalf (a) to sign and cause to be filed amendments to the
registration statement of the Trust under the Securities Act of 1933, the
Investment Company Act of 1940 and the laws and regulations of the various
states, if applicable, and all consents and exhibits thereto; (b) to withdraw
such registration statement or any amendments or exhibits and make requests for
acceleration in connection therewith; (c) to take all other action of whatever
kind or nature in connection with such registration statement, and all
amendments thereto, which said attorneys may deem advisable; and (d) to make,
file, execute, amend, and withdraw documents of every kind, and to take other
action of whatever kind they may elect, for the purpose of complying with all
laws relating to the sale of securities of the Trust, hereby ratifying and
confirming all actions of any of said attorneys hereunder, provided that this
Power of Attorney is ratified to be effective by the Trustees with respect to
each filing or withdrawal of such registration statement and all amendments,
consents, and exhibits thereto. Said attorneys may act jointly or severally, and
the action of one shall being the undersigned as if two or more had acted
together.
IN WITNESS WHEREOF, the undersigned has hereby set his hand as of this 20th
day of May, 1997.
Signature Title Date
/s/ James P. Craig Trustee May 20, 1997
James P. Craig, III
EXHIBIT 17
JANUS INVESTMENT FUND (the "Trust")
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby makes, constitutes,
and appoints Thomas H. Bailey and Steven R. Goodbarn, and each of them,
severally, his true and lawful attorneys and agents in his name, place, and
stead on his behalf (a) to sign and cause to be filed amendments to the
registration statement of the Trust under the Securities Act of 1933, the
Investment Company Act of 1940 and the laws and regulations of the various
states, if applicable, and all consents and exhibits thereto; (b) to withdraw
such registration statement or any amendments or exhibits and make requests for
acceleration in connection therewith; (c) to take all other action of whatever
kind or nature in connection with such registration statement, and all
amendments thereto, which said attorneys may deem advisable; and (d) to make,
file, execute, amend, and withdraw documents of every kind, and to take other
action of whatever kind they may elect, for the purpose of complying with all
laws relating to the sale of securities of the Trust, hereby ratifying and
confirming all actions of any of said attorneys hereunder, provided that this
Power of Attorney is ratified to be effective by the Trustees with respect to
each filing or withdrawal of such registration statement and all amendments,
consents, and exhibits thereto. Said attorneys may act jointly or severally, and
the action of one shall being the undersigned as if two or more had acted
together.
IN WITNESS WHEREOF, the undersigned has hereby set his hand as of this 20th
day of May, 1997.
Signature Title Date
/s/ Gary O. Loo Trustee May 20, 1997
Gary O. Loo
EXHIBIT 17
JANUS INVESTMENT FUND (the "Trust")
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby makes, constitutes,
and appoints Thomas H. Bailey and Steven R. Goodbarn, and each of them,
severally, his true and lawful attorneys and agents in his name, place, and
stead on his behalf (a) to sign and cause to be filed amendments to the
registration statement of the Trust under the Securities Act of 1933, the
Investment Company Act of 1940 and the laws and regulations of the various
states, if applicable, and all consents and exhibits thereto; (b) to withdraw
such registration statement or any amendments or exhibits and make requests for
acceleration in connection therewith; (c) to take all other action of whatever
kind or nature in connection with such registration statement, and all
amendments thereto, which said attorneys may deem advisable; and (d) to make,
file, execute, amend, and withdraw documents of every kind, and to take other
action of whatever kind they may elect, for the purpose of complying with all
laws relating to the sale of securities of the Trust, hereby ratifying and
confirming all actions of any of said attorneys hereunder, provided that this
Power of Attorney is ratified to be effective by the Trustees with respect to
each filing or withdrawal of such registration statement and all amendments,
consents, and exhibits thereto. Said attorneys may act jointly or severally, and
the action of one shall being the undersigned as if two or more had acted
together.
IN WITNESS WHEREOF, the undersigned has hereby set his hand as of this 20th
day of May, 1997.
Signature Title Date
/s/ Dennis B. Mullen Trustee May 20, 1997
Dennis B. Mullen
EXHIBIT 17
JANUS INVESTMENT FUND (the "Trust")
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby makes, constitutes,
and appoints Thomas H. Bailey and Steven R. Goodbarn, and each of them,
severally, his true and lawful attorneys and agents in his name, place, and
stead on his behalf (a) to sign and cause to be filed amendments to the
registration statement of the Trust under the Securities Act of 1933, the
Investment Company Act of 1940 and the laws and regulations of the various
states, if applicable, and all consents and exhibits thereto; (b) to withdraw
such registration statement or any amendments or exhibits and make requests for
acceleration in connection therewith; (c) to take all other action of whatever
kind or nature in connection with such registration statement, and all
amendments thereto, which said attorneys may deem advisable; and (d) to make,
file, execute, amend, and withdraw documents of every kind, and to take other
action of whatever kind they may elect, for the purpose of complying with all
laws relating to the sale of securities of the Trust, hereby ratifying and
confirming all actions of any of said attorneys hereunder, provided that this
Power of Attorney is ratified to be effective by the Trustees with respect to
each filing or withdrawal of such registration statement and all amendments,
consents, and exhibits thereto. Said attorneys may act jointly or severally, and
the action of one shall being the undersigned as if two or more had acted
together.
IN WITNESS WHEREOF, the undersigned has hereby set his hand as of this 20th
day of May, 1997.
Signature Title Date
/s/ James T. Rothe Trustee May 20, 1997
James T. Rothe
EXHIBIT 17
JANUS INVESTMENT FUND (the "Trust")
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby makes, constitutes,
and appoints Thomas H. Bailey and Steven R. Goodbarn, and each of them,
severally, his true and lawful attorneys and agents in his name, place, and
stead on his behalf (a) to sign and cause to be filed amendments to the
registration statement of the Trust under the Securities Act of 1933, the
Investment Company Act of 1940 and the laws and regulations of the various
states, if applicable, and all consents and exhibits thereto; (b) to withdraw
such registration statement or any amendments or exhibits and make requests for
acceleration in connection therewith; (c) to take all other action of whatever
kind or nature in connection with such registration statement, and all
amendments thereto, which said attorneys may deem advisable; and (d) to make,
file, execute, amend, and withdraw documents of every kind, and to take other
action of whatever kind they may elect, for the purpose of complying with all
laws relating to the sale of securities of the Trust, hereby ratifying and
confirming all actions of any of said attorneys hereunder, provided that this
Power of Attorney is ratified to be effective by the Trustees with respect to
each filing or withdrawal of such registration statement and all amendments,
consents, and exhibits thereto. Said attorneys may act jointly or severally, and
the action of one shall being the undersigned as if two or more had acted
together.
IN WITNESS WHEREOF, the undersigned has hereby set his hand as of this 20th
day of May, 1997.
Signature Title Date
/s/ William D. Stewart Trustee May 20, 1997
William D. Stewart
EXHIBIT 17
JANUS INVESTMENT FUND (the "Trust")
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby makes, constitutes,
and appoints Thomas H. Bailey and Steven R. Goodbarn, and each of them,
severally, his true and lawful attorneys and agents in his name, place, and
stead on his behalf (a) to sign and cause to be filed amendments to the
registration statement of the Trust under the Securities Act of 1933, the
Investment Company Act of 1940 and the laws and regulations of the various
states, if applicable, and all consents and exhibits thereto; (b) to withdraw
such registration statement or any amendments or exhibits and make requests for
acceleration in connection therewith; (c) to take all other action of whatever
kind or nature in connection with such registration statement, and all
amendments thereto, which said attorneys may deem advisable; and (d) to make,
file, execute, amend, and withdraw documents of every kind, and to take other
action of whatever kind they may elect, for the purpose of complying with all
laws relating to the sale of securities of the Trust, hereby ratifying and
confirming all actions of any of said attorneys hereunder, provided that this
Power of Attorney is ratified to be effective by the Trustees with respect to
each filing or withdrawal of such registration statement and all amendments,
consents, and exhibits thereto. Said attorneys may act jointly or severally, and
the action of one shall being the undersigned as if two or more had acted
together.
IN WITNESS WHEREOF, the undersigned has hereby set his hand as of this 20th
day of May, 1997.
Signature Title Date
/s/ Martin H. Waldinger Trustee May 20, 1997
Martin H. Waldinger
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from
financial
statements dated October 31, 1996 included in the Fund's Annual
Report and is
qualified in its entirely by reference to such financial statement.
</LEGEND>
<SERIES>
<NUMBER> 3
<NAME> JANUS SPECIAL SITUATIONS FUND
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> DEC-31-1996
<PERIOD-END> APR-30-1997
<EXCHANGE-RATE> 1.000
<INVESTMENTS-AT-COST> 117,886
<INVESTMENTS-AT-VALUE> 124,442
<RECEIVABLES> 5,726
<ASSETS-OTHER> 594
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 130,762
<PAYABLE-FOR-SECURITIES> 5,998
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 522
<TOTAL-LIABILITIES> 6,520
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 117,889
<SHARES-COMMON-STOCK> 11,478
<SHARES-COMMON-PRIOR> 0
<ACCUMULATED-NII-CURRENT> 38
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> (235)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 6,550
<NET-ASSETS> 124,242
<DIVIDEND-INCOME> 278
<INTEREST-INCOME> 159
<OTHER-INCOME> 0
<EXPENSES-NET> 399
<NET-INVESTMENT-INCOME> 38
<REALIZED-GAINS-CURRENT> (235)
<APPREC-INCREASE-CURRENT> 6,550
<NET-CHANGE-FROM-OPS> 6,315
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 13,026
<NUMBER-OF-SHARES-REDEEMED> (1,548)
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 117,889
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 251
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 407
<AVERAGE-NET-ASSETS> 91,325
<PER-SHARE-NAV-BEGIN> 10.000
<PER-SHARE-NII> 0.000
<PER-SHARE-GAIN-APPREC> 0.820
<PER-SHARE-DIVIDEND> 0.000
<PER-SHARE-DISTRIBUTIONS> 0.000
<RETURNS-OF-CAPITAL> 0.000
<PER-SHARE-NAV-END> 10.820
<EXPENSE-RATIO> 1.34
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0.000
</TABLE>
