| Shareholders of these proposals will impact your Fund. Please refer to the following table as
a reference for which proposal(s) applies to you.
PROPOSALS
--------------------------------------------------------------------------------------
2.a. 2.b. 2.c.
1 (PERFORMANCE (PERFORMANCE (PERFORMANCE
(TRUSTEE BASED BASED BASED
FUND ELECTION) ADVISORY FEE) ADVISORY FEE) ADVISORY FEE)
---- --------- ------------- ------------- -------------
Balanced Portfolio X
Enterprise Portfolio X
Flexible Bond Portfolio X
Forty Portfolio X X
Global Life Sciences
Portfolio X
Global Technology Portfolio X
Growth and Income Portfolio X Janus Portfolio X X
Overseasare being asked to consider a proposal to approve an amended and restated investment advisory agreement to change the benchmark index and performance hurdle used to calculate the performance adjustment component of the Fund’s investment advisory fee. You are being asked to consider this change in connection with proposed changes to the investment policies and strategies of Janus Portfolio, X X
Research Corewhich are intended to align Janus Portfolio X
Worldwidewith a similarly managed retail fund for which a reorganization has been proposed. The amended and restated investment advisory agreement and investment strategy changes for Janus Portfolio Xwill only take effect if the proposed reorganization of the similarly managed Fund is completed.
| The Board of Trustees is requesting that shareholders elect an additional Trustee, Diane L. Wallace (the “Trustee Nominee”). |
| Shareholders are also being asked to consider a proposal to implement a “manager-of-managers” structure in order to provide Janus Aspen INTECH Risk-
Managed Core Portfolio XCapital with greater flexibility with respect to the appointment of sub-advisers in the future. |
| Each of these proposals is discussed further below. Not all of these proposals impact all Funds. Please refer to the table at the end of this synopsis as a reference for which proposal(s) applies to you. |
Q: | How will Fund shareholders (and contract owners) be affected by the Transaction? |
A: | Your Fund investment will not change as a result of the Transaction. You will still own the same Fund shares and the underlying value of those shares will not change as a result of the Transaction. The Adviser, and, if applicable, your Fund’s sub-adviser, will continue to manage your Fund according to the same objectives and policies as before and do not anticipate any significant changes to your Fund’s operations, except as described in Proposal 3 with respect to Janus Portfolio. |
i
| In the event the Transaction takes place, the combined company, which will be renamed Janus Henderson Global Investors plc (“Janus Henderson”), will have approximately $[] billion in assets under management and a combined market capitalization of $[] billion. In addition, each Fund’s name will change to reflect “Janus Henderson” as part of the Fund’s name. Janus expects that the combination of these two complementary businesses will create a leading global active asset manager with significant scale, diverse products and investment strategies, and depth and breadth in global distribution. |
Proposals 1 and 2: Approve New Investment Advisory and Sub-advisory Agreements Q: | Why are shareholders being asked to approve a new investment advisory agreement between the Fund and Janus Capital? |
A: | Janus Capital currently serves as each Fund’s investment adviser. The Transaction may be deemed to cause an “assignment” of the current investment advisory agreement with your Fund, which would cause the agreement to terminate. Shareholders are being asked to approve a new investment advisory agreement between the Adviser and their Fund to permit the Adviser to continue to serve as investment adviser to the Fund. |
Q: | For certain Funds, why are shareholders being asked to approve a new sub-advisory agreement between Janus Capital and the Fund’s current sub-adviser? |
A: | For Janus Aspen Perkins Mid Cap Value Portfolio, X
Janus Capital has retained Perkins, to manage the assets of the Fund. For Janus Aspen INTECH U.S. Low Volatility Portfolio, Janus Capital has retained INTECH, to manage the assets of the Fund. The Transaction may cause the current sub-advisory agreement for such Funds to terminate. Shareholders of such Funds are being asked to approve a new sub-advisory agreement between Janus Capital and Perkins or INTECH, as applicable, to permit such sub-adviser to continue to manage their Fund following the Closing. |
PROPOSAL 1: ELECTION OF TRUSTEES
WHY AM I BEING ASKED TO ELECT TRUSTEES?
The Trustees overseeQ: | Will the Transaction result in any important differences between the new investment advisory agreement and investment sub-advisory agreement compared to the current agreements for my Fund? |
A: | No. The terms of the new agreements with the Adviser and your Fund’s current sub-adviser are substantially similar to the current agreements. There will be no change in the contractual advisory fee rate your Fund pays or the investment advisory services it receives as a result of the Transaction. Certain proposed changes to the performance adjustment component of the investment advisory fee for Janus Portfolio are discussed in Proposal 3. |
Q: | What will happen if shareholders of my Fund do not approve the new investment advisory agreement or sub-advisory agreement before consummation of the Transaction? |
A: | Janus Capital, and if applicable, your Fund’s current sub-adviser, will continue to manage your Fund under an interim investment advisory agreement and if applicable, an interim sub-advisory agreement, but must place their compensation for their services during this interim period in escrow, pending shareholder approval of the proposed new agreements. The Board of Trustees urges you to vote without delay in order to avoid potential disruption to your Fund if the Adviser and any sub-adviser were unable to continue to manage the Fund. |
ii
Proposal 3: Approve an Amended and Restated Investment Advisory Agreement for Janus Portfolio Q. | For shareholders of Janus Portfolio, why am I being asked to approve an amended and restated investment advisory agreement to change the Performance Adjustment? |
A: | For Janus Portfolio, the Adviser has proposed certain changes to the Fund’s name, principal investment strategy and portfolio management team (the “Realignment”) in order to streamline the Janus product lineup and to more efficiently manage the portfolios. These changes do not require shareholder approval. Separately, a similarly managed retail fund managed by Janus Capital, “JIF Janus Fund,” is proposed to merge into another retail fund managed by Janus Capital, “JIF Janus Research Fund.” The Realignment is intended to align Janus Portfolio with JIF Janus Research Fund. Pursuant to the Realignment, Janus Portfolio’s name will change to Janus Research Portfolio (or Janus Henderson Research Portfolio assuming the Transaction is completed), and the Fund will be managed by Janus Capital’s research analysts, overseen by Janus Capital’s Director of Research, who select investments that represent the research team’s high-conviction investment ideas in all market capitalizations and styles. |
| In connection with the Realignment, the Board of Trustees has approved an amended and restated investment advisory agreement for Janus Portfolio that would implement a change to the benchmark index and the performance hurdle for Janus Portfolio used to calculate the performance adjustment (“Performance Adjustment”) to the advisory fee. This change is intended to align the performance fee components with the investment strategy changes. The Realignment and the amended and restated advisory agreement will only take effect if the Merger of JIF Janus Fund into JIF Janus Research Fund is completed. The Realignment does not require shareholder approval. If the proposed merger of JIF Janus Fund into JIF Janus Research Fund is completed, but the amended and restated advisory agreement is not approved, the Board will reconsider whether to implement the Realignment and take such actions as it deems to be in the best interest of Janus Portfolio. |
Q: | What effect will the change to the Performance Adjustment for Janus Portfolio have upon the investment advisory fee rate the Fund pays to Janus Capital? |
A: | Janus Portfolio pays Janus Capital a base investment advisory fee rate that adjusts up or down based on the Fund’s Performance Adjustment. The base fee rate, which is an annualized rate of 0.64% of the average daily net assets of the Fund, will not change. Whether the change in the Performance Adjustment results in an increase or decrease in the investment advisory fees that otherwise would have been paid by the Fund depends on whether the Fund’s future performance compares more favorably with the new performance fee benchmark index and performance hurdle or the current performance fee benchmark index and performance hurdle. While it is not possible to predict the effect of the change to the Performance Adjustment on future advisory fees paid by the Fund to Janus Capital, since any adjustment will depend on the future cumulative performance of the Fund relative to the approved performance fee benchmark index and performance hurdle, as well as future changes to the size of the Fund over the specified period of time, this proxy statement contains information to help you evaluate the impact of this change. |
Q: | What will happen if shareholders of Janus Portfolio do not approve the change to the Performance Adjustment? |
A: | The current benchmark index and hurdle rate used to calculate the Performance Adjustment would remain the same and the Fund’s name and principal investment strategies would not change. |
Proposal 4: Election of an Additional Trustee Q: | Why are shareholders being asked to elect an additional Trustee? |
A: | Currently, the Board of Trustees of the Trust has eight members, each of whom is an Independent Trustee (as described below). In connection with the Transaction, the Board has sought to increase the size of the Board to nine and has nominated Diane L. Wallace (the “Trustee Nominee”) to stand for election as a Trustee. Ms. Wallace currently serves as a trustee of certain mutual funds advised by Henderson Global Investors (North America) Inc., a subsidiary of Henderson. Ms. Wallace was unanimously approved by the Board to stand for election, upon a recommendation from the Trust’s Nominating and Governance Committee. Among other things, the Board considered Ms. Wallace’s background and experience in the financial services industry, including with the Henderson funds, and determined that the addition of Ms. Wallace to the Board would provide valuable continuity and enhance the Board’s oversight of the Funds following the completion of the Transaction. |
iii
| Each current Trustee and the Trustee Nominee is an Independent Trustee, meaning that each is not an “interested person” (as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended (the “1940 Act”)) of the Trust, Janus Capital, or Henderson. Information about the Trustee Nominee, including age, principal occupations during the past five years, and other information, such as the Trustee Nominee’s experience, qualifications, attributes, or skills, is set forth in this Proxy Statement. |
Proposal 5: Approval of Manager of Managers Structure Q. | Why are shareholders being asked to vote on the Manager of Managers proposal? |
A: | Janus Capital and the Trust obtained exemptive relief from the U.S. Securities and Exchange Commission (“SEC”) that provides Janus Capital the flexibility to enter into and materially amend sub-advisory agreements in the future with wholly-owned sub-advisers and unaffiliated sub-advisers, with the approval of the Board of Trustees of the Trust, but without the costs and delays associated with holding a shareholder meeting. This is referred to as “Manager of Managers” relief. However, in order to utilize the relief, shareholders of a Fund must approve its use for their Fund. There are no proposed changes to any Fund’s existing sub-advisory arrangement at this time. In the future, if Janus Capital and/or the Board determines that resources of a sub-adviser, or different sub-adviser, would be beneficial for a Fund, your approval of the Manager of Managers Proposal would allow Janus Capital to engage the sub-adviser without incurring the costs related to a shareholder meeting and proxy solicitation. The appointment of the sub-adviser is subject to Board approval and you would have notification of each such engagement. |
Voting Q: | How does the Board of Trustees of the Trust suggest I vote with respect to each proposal? |
A: | After careful consideration, the Board of Trustees of the Trust unanimously recommends that you vote “FOR” each proposal. Please see the section of the Proxy Statement for a discussion of the Board’s considerations in making such recommendations. |
Q: | Who is eligible to vote? |
A: | Shareholders who owned shares of a Fund and other series of the Trust at the close of business on December 29, 2016 (the “Record Date”) will be entitled to be present and vote at the Meeting. Those shareholders are entitled to one vote for each whole dollar (and a proportionate fractional vote for each fractional dollar) of net asset value owned on all matters presented at the Meeting regarding their Fund. |
| Shares of each Fund are available in connection with investment in and payments under variable life insurance contracts and variable annuity contracts offered by the separate accounts, or subaccounts thereof, of certain life insurance companies (“Participating Insurance Companies”). Shares of the Funds may also be available to certain qualified retirement plans. Individual contract owners are not the “shareholders” of a Fund. Rather, the Participating Insurance Companies and their separate accounts are the shareholders. Each Participating Insurance Company may offer to contract owners the opportunity to instruct it how to vote shares on the proposals presented at the Meeting. Each contract owner of record at the close of business on the Record Date may have the right to instruct a Participating Insurance Company as to the manner in which shares attributable to their contract should be voted. |
Q: | How do I vote my shares? |
A: | You can vote or provide instructions in any one of four ways: |
By Internetthrough the management and operations of your Fundwebsite listed in the proxy voting instructions; By telephoneby calling the toll-free number listed on your behalf. Certain regulations require that a majority ofproxy card(s) and following the Trustees be elected
by shareholders and while the Funds are not required, and do not intend, to hold
annual shareholder meetings for the purpose of electing Trustees, under the
terms of a settlement reached between Janus Capital Management LLC ("Janus
Capital") and the Securities and Exchange Commission in August 2004, commencing
in 2005 and not less than every fifth calendar year thereafter, the Funds are
obligated to hold a meeting of shareholders to elect Trustees. The last
shareholder meeting to elect Trustees occurred in 2005. The Board of Trustees of
your Fund (the "Board) is currently comprised of eight Trustees, all of whom are
independent. Two Trustees will retire effective December 31, 2010 in accordance
with the retirement policy set by the Trustees. The Board is seeking to add two
independent Trustees to maintain the number of Trustees at eight going forward.
All eight members of the current Board and two new members will stand for
election at the
1
Meeting and, if approved, all ten members will serve on the Board until two of
those members retire effective December 31, 2010.
PROPOSAL 2: APPROVAL OF AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENTS
(FORTY PORTFOLIO, JANUS PORTFOLIO AND OVERSEAS PORTFOLIO ONLY)
WHY IS THE BOARD PROPOSING MOVING TO A PERFORMANCE-BASED FEE SCHEDULE FOR
CERTAIN FUNDS?
The Board believes that a fee schedule that adjusts based upon the positive
or negative performance of a Fund, relative to its benchmark index, better
aligns the interests of the portfolio manager and Janus Capital with those of
the Fund's shareholders. Currently, each Fund pays an advisory fee at a fixed
annual rate. As proposed, the rate of the investment advisory fee payable to
Janus Capital would decrease when a Fund does not perform well over a certain
time period, relative to its benchmark index, and would increase during periods
when the Fund outperforms its benchmark index. Janus Capital believes that the
proposed advisory fee structure will enable it to maintain the quality of
services it provides to each Fund and to attract and retain talented investment
personnel.
WHAT EFFECT WILL MOVING TO A PERFORMANCE-BASED FEE SCHEDULE FOR CERTAIN FUNDS
HAVE UPON THE INVESTMENT ADVISORY FEE RATE EACH FUND PAYS TO JANUS CAPITAL?
It is not possible to predict the effect of the performance adjustment on
future overall compensation paid by a Fund to Janus Capital, since any
adjustment will depend on the cumulative performance of the Fund relative to the
approved Fund benchmark index, as well as future changes to the size of the Fund
over the specified performance period. That being said, the proxy statement
contains information to help you evaluate the impact of this proposed change in
the fee structure.
ADDITIONAL INFORMATION
WHAT IS THE RECOMMENDATION OF THE BOARD OF TRUSTEES?
The Board of Trustees recommends that you vote "FOR" the proposals
applicable to your Fund.
WHAT WILL HAPPEN IF SHAREHOLDERS OF A FUND DO NOT APPROVE THE APPLICABLE
PROPOSALS TO AMEND THE INVESTMENT ADVISORY AGREEMENT FOR THEIR FUND TO IMPLEMENT
PERFORMANCE FEES? (FORTY PORTFOLIO, JANUS PORTFOLIO, AND OVERSEAS PORTFOLIO
ONLY)
If shareholders of a Fund do not approve the proposal applicable to their
Fund, the current investment advisory agreement will remain in effect with
respect to that Fund. Janus Capital will continue to manage the Fund and receive
compensation for its services at a flat fixed-rate fee. The Board of Trustees
will take such action as it deems to be in the best interest of each Fund,
including potentially soliciting additional proxies.
2
WHO IS ELIGIBLE TO VOTE?
Shareholders who owned shares of a Fund at the close of business on
[ , 2010] (the "Record Date") will be entitled to be present and vote
at the Meeting. Those shareholders are entitled to one vote for each whole
dollar (and a proportionate fractional vote for each fractional dollar) of net
asset value owned on all matters presented at the Meeting regarding their
respective Fund.
HOW DO I VOTE MY SHARES?
You can vote in any one of four ways:
- BY MAIL, recorded instructions; By mail,by sending the enclosed proxy card(s) (signed and dated) in the enclosed envelope; - BY INTERNET, by going to the website listed on your proxy card;
- BY TELEPHONE, using the toll-free number listed on your proxy card; or
- IN PERSON, by attending In personat the Meeting on [ , 2010] (or any
adjournment or postponement thereof).
Whichever method you choose, please take the time to read the full text of
the Proxy Statement before you vote.
It is important that shareholders respond to ensure that there is a quorum
for the Meeting. If we do not receive your response within a few weeks, you may
be contacted by [ ], the proxy solicitor engaged by Janus Capital, who
will remind you to vote your shares and help you return your proxy. If we do not
receive sufficient votes to approve a proposal by the date of the Meeting, we
may adjourn the Meeting, with respect to that proposal, to a later date so that
we can continue to seek additional votes. Submitting your vote promptly will
help to save costs associated with additional solicitations.
IF I SEND MY VOTE IN NOW AS REQUESTED, CAN I CHANGE IT LATER?
Yes. You may revoke your proxy vote at any time before it is voted at the
Meeting by: (i) delivering a written revocation to the Secretary of the Funds at
151 Detroit Street, Denver, Colorado 80206; (ii) submitting a subsequently
executed proxy vote; or (iii) attending the Meeting and voting in person. Even
if you plan to attend the Meeting, we ask that you return your proxy. This will
help us ensure that an adequate number of shares are present at the Meeting for
consideration of the proposal.
WHAT IS THE REQUIRED VOTE TO APPROVE EACH PROPOSAL?
Election of the Trustees will be determined by the affirmative vote of a
plurality (the greatest number of affirmative votes) of the shares of all Funds
of the Trust voting in person or by proxy at the Meeting.
Approval of each remaining proposal (Proposals 2.a., 2.b., and 2.c.) will
require the affirmative vote of a "majority of the outstanding voting
securities" of the Fund (voting separately) within the meaning of the Investment
Company Act of 1940, as amended. A
3
"majority of the outstanding voting securities" means the lesser of (i) 67% or
more of the shares of the Fund present at the Meeting, if the holders of more
than 50% of the outstanding shares are present or represented by proxy, or (ii)
more than 50% of the outstanding shares (a "1940 Act Majority").
Quorum for consideration of a proposal at the Meeting is one-third of the
outstanding shares entitled to vote of (i) all Funds (for election of Trustees),
and (ii) the applicable Fund for the proposal related to the amendment to the
advisory agreement.
WHO SHOULD I CALL FOR ADDITIONAL INFORMATION ABOUT THIS PROXY STATEMENT?
Please call [ ], the proxy solicitor for the Fund, at
[1- ].
4
[ , 2010]
JANUS ASPEN SERIES
April 6, 2017. iv
| Whichever method you choose, please take the time to read the full text of the Proxy Statement before you vote. |
| It is important that shareholders respond to ensure that there is a quorum for the Meeting. If we do not receive your response within a few weeks, you may be contacted by Computershare Fund Services (“Computershare”), the proxy solicitor engaged by the Funds, who will remind you to vote your shares and help you return your proxy. If we do not receive sufficient votes to approve the proposals by the date of the Meeting, we may adjourn the Meeting to a later date so that we can continue to seek additional votes. |
| Each Participating Insurance Company may offer to contract owners the opportunity to instruct it how to vote shares with respect to the proposals presented at the Meeting. Each contract owner of record at the close of business on the Record Date may have the right to instruct a Participating Insurance Company as to the manner in which shares attributable to their contract should be voted. |
Q: | If I send my vote in now as requested, can I change it later? |
A: | Yes. Shareholders may revoke their proxy vote at any time before it is voted at the Meeting by: (i) delivering a written revocation to the Secretary of the Trust at 151 Detroit Street, Denver, Colorado 80206; (ii) submitting a subsequently executed proxy vote; or (iii) attending the Meeting and voting in person. Even if a shareholder plans to attend the Meeting, we ask that all shareholders return proxies. This will help us ensure that an adequate number of shares are present at the Meeting for consideration of the proposals. Shareholders should send notices of revocation to Janus Investment Fund at 151 Detroit Street, Denver, Colorado 80206, Attn: Secretary. |
Q: | What is the required vote to approve the proposals? |
A: | Approval of Proposals 1, 2, 3 and 5 with respect to each applicable Fund requires the affirmative vote of a “majority of the outstanding voting securities” as defined under the Investment Company Act of 1940, as amended (the “1940 Act”) (such a majority referred to herein as a “1940 Act Majority”), of such Fund. A 1940 Act Majority means the lesser of the vote of (i) 67% or more of the shares of the Fund entitled to vote thereon present at the Meeting, if the holders of more than 50% of such outstanding shares are present in person or represented by proxy; or (ii) more than 50% of such outstanding shares of the Fund entitled to vote thereon. |
| Shareholders of each applicable Fund (with all classes of shares of a Fund voting together as a single class) will vote separately on Proposals 1, 2, 3 and 5 relating to their Fund. An unfavorable vote on any proposal by the shareholders of one Fund will not affect the implementation of such proposal by another Fund if the proposal is approved by the shareholders of that Fund. However, Proposals 1 and 2 will only take effect upon the closing of the Transaction, which is conditioned upon obtaining the approval of new investment advisory agreements by shareholders of Janus funds representing a specified percentage of assets under management. |
| For Proposal 4, the Trustee election will be determined by the affirmative vote of a plurality (the greatest number of affirmative votes) of the shares of all funds of the Trust, including all Funds listed in this Proxy Statement and Global Allocation Portfolio – Moderate, for which votes are being solicited pursuant to a separate proxy statement. Proposal 4 will only take effect upon the closing of the Transaction. |
| A quorum of shareholders is required to take action at the Meeting. The presence in person or by proxy of the holders of record of one-third of shares outstanding and entitled to vote at the Meeting constitutes a quorum. |
Q: | Who should I call for additional information about this Proxy Statement? |
A: | Please call Computershare, the proxy solicitor engaged by the Funds, at 866-492-0863. |
v
Proposals | | | | | | | | | | | Fund | | Proposal 1: Advisory Agreement | | Proposal 2: New Sub- Advisory Agreement (with the sub-adviser listed below) | | Proposal 3: Amended and Restated Advisory Agreement | | Proposal 4: Election of Trustee | | Proposal 5: Manager of Managers | Balanced Portfolio Janus Portfolio
| | X | | | | | | X | | X | Enterprise Portfolio Overseas Portfolio
| | X | | | | | | X | | X | Flexible Bond Portfolio | | X | | | | | | X | | X | Forty Portfolio | | X | | | | | | X | | X | Global Allocation Portfolio – Moderate | | X | | | | | | X | | X | Global Research Core Portfolio
Forty Portfolio Worldwide Portfolio
| | X | | | | | | X | | X | Global Life SciencesTechnology Portfolio | | X | | | | | | X | | X | Global Unconstrained Bond Portfolio | | X | | | | | | X | | | Janus Aspen INTECH Risk-Managed CoreU.S. Low Volatility Portfolio
Global Technology Portfolio | | X | | X (INTECH) | | | | X | | X | Janus Aspen Perkins Mid Cap Value Portfolio
Growth and Income | | X | | X (Perkins) | | | | X | | X | Janus Portfolio | | X | | | | X | | X | | X | Overseas Portfolio | | X | | | | | | X | | X |
vi
, 2017 JANUS ASPEN SERIES | | | Balanced Portfolio Enterprise Portfolio Flexible Bond Portfolio Forty Portfolio Global Allocation Portfolio – Moderate Global Research Portfolio | | Global Technology Portfolio Global Unconstrained Bond Portfolio Janus Aspen INTECH U.S. Low Volatility Portfolio Janus Aspen Perkins Mid Cap Value Portfolio Janus Portfolio Overseas Portfolio |
151 DETROIT STREET
DENVER, COLORADODetroit Street Denver, Colorado 80206 JOINT SPECIAL MEETING OF SHAREHOLDERS JOINT PROXY STATEMENT This is a joint proxy statement ("(“Proxy Statement"Statement”) for the Janus funds listed above (each, a "Fund"“Fund” and collectively, the "Funds"“Funds”), each a series of Janus Aspen Series (the "Trust"“Trust”). Proxies for a joint Special Meeting of Shareholders of each Fund are being solicited by the Board of Trustees of the Trust (the "Board,"“Board,” the "Board“Board of Trustees,"” or the "Trustees"“Trustees”) to approve the following proposals (each, a “Proposal”) that have already been approved by the Board: Proposal 1. For all Funds, to approve a new investment advisory agreement between the Trust, to elect ten Trustees, eachon behalf of whom is
considered "independent."
your Fund, and Janus Capital Management LLC (“Janus Capital” or the “Adviser”). Proposal 2. ToFor certain Funds, to approve a new sub-advisory agreement between the Adviser and the Fund’s current sub-adviser as follows: | a. | For Janus Aspen INTECH U.S. Low Volatility Portfolio, to approve a new sub-advisory agreement between the Adviser and INTECH Investment Management LLC (“INTECH”); and |
| b. | For Janus Aspen Perkins Mid Cap Value Portfolio, to approve a new sub-advisory agreement between the Adviser and Perkins Investment Management LLC (“Perkins” and together with INTECH, each a “Sub-Adviser” and collectively, the “Sub-Advisers”). |
Proposal 3. For Janus Portfolio, to approve an amended and restated investment advisory agreement between the Fund and Janus Capital Management LLC
("Janus Capital") to change the benchmark index and performance hurdle used to calculate the performance adjustment component of the Fund’s investment advisory fee rate
fromrate. Proposal 4. For all Funds, to elect an additional trustee to the Board of Trustees of the Trust. Proposal 5. For all Funds, except Global Unconstrained Bond Portfolio, to approve a fixed rateproposal that would authorize the Adviser to a rate that adjusts up or down based uponenter into and materially amend sub-advisory agreements in the Fund's performance relative to its benchmark index forfuture with wholly-owned sub-advisers and unaffiliated sub-advisers, with the following Funds:
a. Forty Portfolio
b. Janus Portfolio (formerly named Large Cap Growth Portfolio)
c. Overseas Portfolio (formerly named International Growth
Portfolio)
approval of the Board of Trustees of the Trust, but without obtaining additional shareholder approval. The joint Special Meeting of Shareholders will be held at the JW Marriott Hotel, 150 Clayton Lane, Denver, Colorado 80206, on [ , 2010]April 6, 2017 at [10:10:00 a.m.] Mountain Time, or at such later time as may be necessary due to adjournments or postponements thereof (the "Meeting"“Meeting”). Any shareholder of record who owned shares of a Fund as of the close of business on [ , 2010]December 29, 2016 (the "Record Date"“Record Date”), will receive notice of the Meeting and will be entitled to vote at the Meeting. 5
At the Meeting, youshareholders will be asked to vote on the proposalseach proposal applicable to theeach Fund offor which youshares were held shares as of the Record Date. You should read the
entire Proxy Statement before voting. If you have any questions, please call our
proxy solicitor, [ ], at [1- ]. This Proxy Statement, Notice 1
Shares of Special Meeting, and the proxy card(s)each Fund are first being mailed to shareholders
and contract owners on or about [ , 2010].
Each Fund is available in connection with investment in and payments under variable life insurance contracts and variable annuity contracts offered by the separate accounts, or subaccounts thereof, of certain life insurance companies ("(“Participating Insurance Companies"Companies”). TheShares of the Funds may also be available to certain qualified retirement plans. Individual contract owners are not the "shareholders"“shareholders” of a Fund. Rather, the Participating Insurance Companies and their separate accounts are the shareholders. Each Participating Insurance Company may offer to contract owners the opportunity to instruct it how to vote shares on the applicable proposal(s)proposals presented at the Meeting. THE FUNDS PROVIDE ANNUAL AND SEMIANNUAL REPORTS TO THEIR SHAREHOLDERS THAT
HIGHLIGHT RELEVANT INFORMATION, INCLUDING INVESTMENT RESULTS AND A REVIEW OF
PORTFOLIO CHANGES. ADDITIONAL COPIES OF EACH FUND'S MOST RECENT ANNUAL REPORT
AND ANY MORE RECENT SEMIANNUAL REPORT ARE AVAILABLE, WITHOUT CHARGE, BY CALLING
A JANUS REPRESENTATIVE AT [1-877-335-2687]Each contract owner of record at the close of business on the Record Date may have the right to instruct a Participating Insurance Company as to the manner in which shares attributable to their contract should be voted. You should read the entire Proxy Statement before voting. If you have any questions, please call our proxy solicitor, Computershare Fund Services (“Computershare”), VIA THE INTERNET AT
[JANUS.COM/VARIABLE-INSURANCE]at 866-492-0863. This Proxy Statement, Notice of a Joint Special Meeting, and the proxy card(s) are first being mailed to shareholders and contract owners on or about , OR BY SENDING A WRITTEN REQUEST TO THE SECRETARY
OF THE TRUST AT2017. Shares of each Fund are available in connection with investment in and payments under variable life insurance contracts and variable annuity contracts offered by the separate accounts, or subaccounts thereof, of certain life insurance companies (“Participating Insurance Companies”). Shares of the Funds may also be available to certain qualified retirement plans. Individual contract owners are not the “shareholders” of a Fund. Rather, the Participating Insurance Companies and their separate accounts are the shareholders. Each Participating Insurance Company may offer to contract owners the opportunity to instruct it how to vote shares on the proposals presented at the Meeting. The Funds provide annual and semiannual reports to their shareholders that highlight relevant information, including investment results and a review of portfolio changes. Additional copies of each Fund’s most recent annual report and any more recent semiannual report are available, without charge, by calling a Janus representative at 1-877-335-2687, via the Internet at janus.com/variable-insurance, or by sending a written request to the Secretary of the Trust at 151 DETROIT STREET, DENVER, COLORADODetroit Street, Denver, Colorado 80206.
6
PROPOSAL 1
ELECTION OF TRUSTEES
2
INTRODUCTION
At The Adviser is a direct subsidiary of Janus Capital Group Inc. (“Janus”), a publicly traded company with principal operations in financial asset management businesses and approximately $198.9 billion in assets under management as of September 30, 2016. Recently, Janus and Henderson Group plc (“Henderson”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which Janus and Henderson have agreed to effect an all-stock merger of equals strategic combination of their respective businesses, with Janus surviving the Meeting,merger as a direct wholly-owned subsidiary of Henderson (the “Transaction”). Henderson is an independent global asset management business founded in 1934 with approximately $131.2 billion in assets under management, as of September 30, 2016. The Transaction will be effected via a share exchange with each share of Janus common stock exchanged for 4.7190 newly issued ordinary shares in Henderson. Based on the current number of shares outstanding, upon closing of the Transaction, Henderson and Janus shareholders are expected to own approximately 57% and 43%, respectively, of the ordinary shares of the combined company, which will be renamed Janus Henderson Global Investors plc (“Janus Henderson”). Janus Henderson will have approximately $[] billion in assets under management and a combined market capitalization of $[] billion. Janus expects that the combination of these two complementary businesses will create a leading global active asset manager with significant scale, diverse products and investment strategies, and depth and breadth in global distribution, resulting in an organization that will be well-positioned to provide world-class client service. Under the terms of the Merger Agreement, as of the effective time of the Transaction, (i) Richard M. Weil, the current Chief Executive Officer of Janus, will become a co-Chief Executive Officer of Janus Henderson and (ii) Andrew J. Formica, the current Chief Executive Officer of Henderson, will become a co-Chief Executive Officer of Janus Henderson. Janus Henderson will have a Board of Directors consisting initially of twelve directors, (i) six of whom will be persons designated by the existing Board of Directors of Henderson, and (ii) six of whom will be persons designated by the existing Board of Directors of Janus. Completion of the Transaction is subject to the satisfaction or waiver of certain conditions, including (i) the requisite approval of the Merger Agreement by the holders of common stock of Janus; (ii) the requisite approval of the shareholders of allHenderson of the Transaction and certain related matters; (iii) regulatory approvals; and (iv) receipt of certain third party consents, including approval of new investment advisory agreements by shareholders of Janus Capital-advised U.S. registered investment companies, including the Funds, will berepresenting at least 67.5% of the aggregate assets under management of the Janus Capital-advised U.S. registered investment companies. The Merger Agreement also contains certain termination rights for each of Janus and Henderson. Janus and Henderson currently expect to complete the Transaction by the second quarter of 2017. Shareholders of the Funds are being asked to elect ten
individuals to constituteconsider Proposals 1 and 2 (approval of advisory and sub-advisory agreements) and 4 (appointment of trustees) in connection with the Trust's Board of Trustees. The ten nominees for
election as Trustees who receiveTransaction. These Proposals are contingent upon the greatest number of votes from shareholders
voting in person or by proxy at the Meeting will be elected as TrusteesClosing of the Trust. These ten nominees were selected after careful considerationTransaction and will take effect only if the Transaction closes. Proposals 3 (amended advisory agreement for Janus Portfolio) and 5 (manager of managers proposal) are not related to the Transaction and will take effect whether or not the Transaction closes, in the case of Proposal 3 assuming all conditions described herein are met. 3
PROPOSAL 1 APPROVAL OF NEW INVESTMENT ADVISORY AGREEMENT (All Funds) Background Pursuant to a separate investment advisory agreement between Janus Capital and the Trust on behalf of each Fund (each a “Current Advisory Agreement” and collectively, the “Current Advisory Agreements”), Janus Capital serves as each Fund’s investment adviser. The date of each Fund’s Current Advisory Agreement and the date on which it was last approved by shareholders and approved for continuance by the Trust's Nominating and Governance Committee, a committee consisting entirely of
Trustees whoBoard are not "interested" persons (as definedprovided inAppendix B to this Proxy Statement. Each Current Advisory Agreement, as required by Section 2(a)(19)15 of the Investment Company Act of 1940, as amended (the "1940 Act"“1940 Act”), provides for its automatic termination in the event of its “assignment” (as defined in the 1940 Act). The consummation of the Transaction may be deemed an “assignment” of each Current Advisory Agreement which would cause the automatic termination of each Current Advisory Agreement, as required by the 1940 Act. The 1940 Act requires that a new advisory agreement be approved by the board of trustees and the shareholders of a fund in order for it to become effective. The Proposal With respect to each Fund, shareholders of the Fund are being asked to approve a new investment advisory agreement between the Trust, on behalf of the Fund, and the Adviser that are substantially similar to the Current Advisory Agreement to take effect immediately after the Transaction or shareholder approval, whichever is later (each a “New Advisory Agreement” and collectively, the “New Advisory Agreements”). At the December 8, 2016 Board meeting, and for the reasons discussed below (see “Board Considerations” after Proposal 2 in this Proxy Statement), the Board, all of whom are Trustees who are not “interested persons” (as defined in Section 2(a)(19) of the 1940 Act) of the Funds, the Adviser, any sub-adviser or Henderson (the “Independent Trustees”), unanimously approved the New Advisory Agreement on behalf of each Fund and unanimously recommended approval of the New Advisory Agreement by shareholders. For additional information regarding the Board’s consideration of the New Advisory Agreements, see “Board Considerations” after Proposal 2 in this Proxy Statement. The form of the New Advisory Agreement is attached hereto asAppendix L to this Proxy Statement. Comparison of Current Advisory Agreements and New Advisory Agreements The terms of each New Advisory Agreement are substantially similar to those of the Current Advisory Agreement. There is no change in the fee rate payable by each Fund to the Adviser. Changes made to the New Advisory Agreement compared to the Current Advisory Agreement include the date of expiration, and, for Funds with a performance-based investment advisory fee, changes to ensure continuity of the advisory fee based on the Fund’s historical performance, as provided for under the Current Advisory Agreement. If approved by shareholders of a Fund, the New Advisory Agreement for each Fund will have an initial term through February 1, 2018 and will continue in effect from year to year if such continuance is approved at least annually in the manner required by the 1940 Act and the rules and regulations thereunder. Below is a comparison of certain terms of the Current Advisory Agreement to the terms of the New Advisory Agreement. For Janus Portfolio, if the Amended Advisory Agreement (as defined in Proposal 3) is approved and entered into prior to the Closing of the Transaction, the Amended Advisory Agreement would replace the Current Advisory Agreement. Under these circumstances, the New Advisory Agreement for Janus Portfolio would be substantially similar to the Amended Advisory Agreement, as opposed to the Current Advisory Agreement. For additional information regarding the Amended Advisory Agreement, see “Comparison of the Current Advisory Agreement and the Amended Advisory Agreement” in Proposal 3. 4
Investment Advisory Services. The investment advisory services to be provided by the Adviser to each Fund are the same under the Current Advisory Agreements and the New Advisory Agreements. Both the Current Advisory Agreements and New Advisory Agreements provide that the Adviser shall furnish continuous advice and recommendations to each Fund, and shall have authority to act with respect thereto, as to the acquisition, holding, or disposition of any or all of the securities or other assets which each Fund may own or contemplate acquiring from time to time. The Adviser shall give due consideration to the investment policies and restrictions and the other statements concerning each Fund in the Trust’s Amended and Restated Trust Instrument, as then in effect, the Trust’s Bylaws, as then in effect, and the registration statements of the Trust, and to provisions of the Internal Revenue Code, as applicable to each Fund as a regulated investment company and as a funding vehicle for variable insurance contracts. In addition, the Adviser shall cause its officers to attend meetings and furnish oral and written reports, as each Fund may reasonably require, in order to keep the Board and appropriate officers of each Fund fully informed as to the condition of the investment portfolio of each Fund. The investment advisory services are expected to be provided by the same personnel of the Adviser under the New Advisory Agreements as under the Current Advisory Agreements. Janus Global Unconstrained Bond Portfolio has a subsidiary to which Janus Capital provides investment advisory services (the “Subsidiary”). The Subsidiary has entered into a separate investment advisory agreement with Janus Capital (the “Subsidiary Advisory Agreement”). The consummation of the Transaction may be deemed an “assignment” of the Subsidiary Advisory Agreement which would cause the automatic termination of the Subsidiary Advisory Agreement, as required by the 1940 Act. In order to permit Janus Capital to continue to serve as investment adviser to the Subsidiary following the Transaction, if the New Advisory Agreement is approved Janus Capital will enter into a new investment advisory agreement with the Subsidiary, which will be substantially similar to the current Subsidiary Advisory Agreement. Fees. Under each Current Advisory Agreement and New Advisory Agreement, the Fund pays to the Adviser an investment advisory fee which is calculated daily and paid monthly. Each Fund’s investment advisory fee rate under the New Advisory Agreement for such Fund is identical to the investment advisory fee rate under the Current Advisory Agreement. Certain Funds pay an investment advisory fee rate that may adjust up or down based on such Fund’s performance relative to the cumulative investment record of its benchmark index over a performance measurement period. For each such Fund, the terms of such performance adjustment under the New Advisory Agreement are identical to the terms of such performance adjustment under the Current Advisory Agreement.Appendix C to this Proxy Statement sets forth each Fund’s investment advisory fee rate.Appendix F to this Proxy Statement sets forth the amount of fees paid to the Adviser during each Fund’s most recently ended fiscal year. Payment of Expenses. Under each Current Advisory Agreement and the New Advisory Agreement, the Funds assume and pay all expenses incidental to their organization, operations and business not specifically assumed or agreed to be paid by the Adviser. These Fund expenses include custodian and transfer agency fees and expenses, brokerage commissions and dealer spreads, and other expenses in connection with the execution of portfolio transactions, legal and accounting expenses, interest, taxes, a portion of trade association or other investment company organization dues and expenses, registration fees, expenses of shareholders’ meetings, reports to shareholders, fees and expenses of Independent Trustees, and other costs of complying with applicable laws regulating the sales of Fund shares. The Funds, along with other Janus funds, also pay some or all of the salaries, fees, and expenses of certain Fund officers and employees of the Adviser (also sharing certain expenses and salaries for the Funds’ Chief Compliance Officer and other compliance-related personnel employed by the Adviser as authorized by the Trustees from time to time). Other Services. Under each Current Advisory Agreement and New Advisory Agreement, the Adviser is authorized, but not obligated, to perform management and administrative services necessary for the operation of each Fund. Specifically, the Adviser is authorized to conduct relations with custodians, depositories, transfer and pricing agents, accountants, attorneys, underwriters, brokers and dealers, corporate fiduciaries, insurance company separate accounts, insurers, banks and such other persons in any such other capacity deemed by the Adviser to be necessary or desirable. The Adviser shall also generally monitor and report to the officers of the Trust regarding each Fund’s compliance with investment policies and restrictions as set forth in the currently effective prospectus and statement of additional information relating to the shares of each Fund. Additionally, the Adviser shall make reports to the Board of its performance of services upon request and furnish advice and recommendations with respect to such other aspects of the business and affairs of each Fund as it shall determine to be desirable. The 5
Adviser is also authorized, subject to review by the Board, to furnish such other services as the Adviser shall from time to time determine to be necessary or useful to perform the services contemplated by the agreement. The Adviser also serves as administrator to the Funds pursuant to an Administration Agreement between Janus Capital and the Trust. See “Affiliated Service Providers, Affiliated Brokerage and Other Fees – Administrator” for additional information regarding these administrative services. Limitation on Liability. The Current Advisory Agreements and New Advisory Agreements provide that the Adviser will not be liable for any error of judgment or mistake of law or for any loss arising out of any investment or for any act or omission taken with respect to a Fund, 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 except to the extent otherwise provided by law. Continuance. The Current Advisory Agreement for each Fund continues in effect for successive one-year periods after its initial term, if such continuance is specifically approved at least annually by (a) the vote of a majority of the Independent Trustees cast in person at a meeting called for the purpose of voting on the terms of such renewal, and (b) either the Trustees of the Trust or the affirmative vote of a majority of the outstanding voting securities of the Fund. The New Advisory Agreement for each Fund will have an initial term until February 1, 2018, and will continue thereafter for successive one-year periods if approved annually in the same manner required under the Current Advisory Agreement. Termination. The Current Advisory Agreement and New Advisory Agreement for each Fund provide that the agreement may be terminated at any time, without penalty, by the Board, or by the shareholders of the Fund acting by vote of at least a majority of its outstanding voting securities, provided in either case that sixty (60) days’ advance written notice of termination be given to the Adviser at its principal place of business. Further, the Current Advisory Agreement and the New Advisory Agreement may be terminated by the Adviser at any time, without penalty, by giving sixty (60) days’ advance written notice of termination to the Fund, addressed to its principal place of business. Interim Advisory Agreements In the event shareholders of a Fund do not approve the New Advisory Agreement at the Meeting prior to the closing of the Transaction, an interim investment advisory agreement between the Adviser and such Fund (each, an “Interim Advisory Agreement” and collectively, the “Interim Advisory Agreements”) will take effect upon the closing of the Transaction. At the December, 2016 meeting, the Board, all of whom are Independent Trustees, unanimously approved an Interim Advisory Agreement for each Fund in order to assure continuity of investment advisory services to the Funds after the Transaction. The terms of each Interim Advisory Agreement are substantially identical to those of the applicable Current Advisory Agreement and New Advisory Agreement, except for the term and escrow provisions described below. The Interim Advisory Agreement will continue in effect for a term ending on the earlier of 150 days from the closing of the Transaction (the “150-day period”) or when shareholders of the Fund approve the New Advisory Agreement. Pursuant to Rule 15a-4 under the 1940 Act, compensation earned by the Adviser under an Interim Advisory Agreement will be held in an interest-bearing escrow account. If shareholders of a Fund approve the New Advisory Agreement prior to the end of the 150-day period, the amount held in the escrow account under the Interim Advisory Agreement will be paid to the Adviser. If shareholders of a Fund do not approve the New Advisory Agreement prior to the end of the 150-day period, the Board will take such action as it deems to be in the best interests of the Fund, and the Adviser will be paid the lesser of its costs incurred in performing its services under the Interim Advisory Agreement or the total amount in the escrow account, plus interest earned. Certain Conditions under the 1940 Act The Board has been advised that the parties to the Merger Agreement have structured the Transaction in reliance upon Section 15(f) of the 1940 Act. Section 15(f) provides in substance that when a sale of a controlling interest in an investment adviser occurs, the investment adviser or any of its affiliated persons may receive any amount or benefit in connection with the sale so long as two conditions are satisfied. The first condition of Section 15(f) is that, during the three-year period following the consummation of a transaction, at least 75% of the investment company’s board of directors must not be “interested persons” (as defined in the 1940 Act) of the investment adviser or predecessor adviser. The composition of the Board of the Trust currently meets this test and 6
would continue to meet this test after the trustee election pursuant to Proposal 4. Second, an “unfair burden” (as defined in the 1940 Act, including any interpretations or no-action letters of the Securities and Exchange Commission (the “SEC”) or the staff of the SEC) must not be imposed on the investment company as a result of the transaction relating to the sale of such interest, or any express or implied terms, conditions or understandings applicable thereto. The term “unfair burden” (as defined in the 1940 Act) includes any arrangement, during the two-year period after the transaction, whereby the investment adviser (or predecessor or successor adviser), or any “interested person” (as defined in the 1940 Act) of such an adviser, receives or is entitled to receive any compensation, directly or indirectly, from the investment company or its security holders (other than fees for bona fide investment advisory or other services) or from any person in connection with the purchase or sale of securities or other property to, from or on behalf of the investment company (other than bona fide ordinary compensation as principal underwriter for the investment company). Under the Merger Agreement, Henderson has acknowledged Janus’s reliance upon the benefits and protections provided by Section 15(f) and has agreed not to take, and to cause its affiliates not to take, any action that would have the effect, directly or indirectly, of causing the requirements of any of the provisions of Section 15(f) not to be met in respect of the Transaction. Additional Information About the Adviser The Adviser, a registered investment adviser, is organized as a Delaware limited liability company and is a direct subsidiary of Janus. Janus is a publicly traded company with principal operations in financial asset management businesses and approximately $198.9 billion in assets under management as of September 30, 2016. Janus offers a broad range of investment solutions, including fixed income, equity, alternative and multi-asset class strategies. Investment strategies are offered through open-end funds domiciled in both the U.S. and offshore, as well as through separately managed accounts, collective investment trusts and exchange-traded products. Based in Denver, Janus has offices located in 12 countries throughout North America, Europe, Asia and Australia. The Adviser has managed primarily growth equity portfolios since 1969. The Adviser has leveraged its research-driven investment philosophy and culture to other areas of the markets, including fundamental fixed income, global macro fixed income, diversified alternatives and exchange-traded products. As of September 30, 2016, the Adviser had approximately $148.8 billion in assets under management. The business address of Janus and the Adviser is 151 Detroit Street, Denver, Colorado 80206. Information regarding other registered investment companies or series thereof (other than the Trust and the Funds) managed by the Adviser, a Sub-Adviser or Henderson that have similar investment strategies to a Fund is set forth inAppendix D to this Proxy Statement. Certain information regarding the executive officers and directors of the Adviser and Sub-Advisers is set forth inAppendix E to this Proxy Statement. Affiliated Service Providers, Affiliated Brokerage and Other Fees Administrator. Janus Capital also serves as administrator to the Funds pursuant to an Administration Agreement between Janus Capital and the Trust. Janus Capital is authorized to delegate to others to perform certain administrative and other services. Pursuant to the Administration Agreement between Janus Capital and the Trust, the Funds reimburse Janus Capital for reasonable costs incurred in performing certain administrative and clerical functions. Some examples of these reimbursable expenses include net asset value determination, fund accounting, updating of the Trust’s registration statement, and supporting the Board of Trustees. Janus Capital does not receive a fee for serving as administrator to the Funds. Janus Capital intends to provide the same administrative services after implementation of the Proposed New Advisory Agreement. Distributor. Janus Distributors LLC (the "Independent Trustees"“Distributor”), located at 151 Detroit Street, Denver, Colorado 80206, a wholly-owned subsidiary of the Adviser, serves as the distributor for the Funds’ shares. Service Shares of the Funds have adopted a distribution and shareholder servicing plan in accordance with Rule 12b-1 under the 1940 Act. The plan is a compensation type plan pursuant to which the Funds pay, on behalf of Service Shares, distribution and/or service fees to the Distributor up to 0.25% intended to result in the sale and/or shareholder servicing of Service Shares of the Funds. Payments are made to the Distributor, who may make ongoing payments to financial intermediaries and may retain amounts paid by the Funds. Payments under the plans are not tied exclusively to actual distribution and shareholder service expenses, and the payments may exceed distribution and shareholder 7
service expenses actually incurred. The Distributor intends to continue to provide the same services after implementation of the proposed New Advisory Agreement. Fees paid by Service Shares of each Fund to the Distributor, pursuant to the 12b-1 plan, during the Fund’s last fiscal year is set forth inAppendix F to this Proxy Statement. Transfer Agent. Janus Services LLC (“Janus Services”), located at 151 Detroit Street, Denver, Colorado 80206, an affiliate of the Adviser, serves as each Fund’s transfer agent. Janus Services receives an administrative services fee at an annual rate of 0.05% of the average daily net assets of each Fund for arranging for the provision by participating insurance companies and qualified plan service providers of administrative services, including recordkeeping, subaccounting, order processing, or other shareholder services provided on behalf of contract holders or plan participants investing in the Funds. Other shareholder services may include the provision of order confirmations, periodic account statements, forwarding prospectuses, shareholder reports, and other materials to existing investors, and answering inquiries regarding accounts. Janus Services expects to use this entire fee to compensate insurance companies and qualified plan service providers for providing these services to its customers who invest in the Funds. Any unused portion will be reimbursed to the applicable share class at least annually. In addition, Janus Services provides or arranges for the provision of certain other internal administrative, recordkeeping, and shareholder relations services for the Funds. Janus Services is not compensated for these internal services related to the Shares, except for out-of-pocket costs. Fees paid to Janus Services by the Funds for compensation payable to third party intermediaries went into effect May 1, 2016, and therefore, no such fees were paid during the Funds’ last fiscal year. Affiliated Brokerage. No Fund paid brokerage commissions within the last fiscal year to (i) any broker that is an affiliated person of such Fund or an affiliated person of such person, or (ii) any broker an affiliated person of which is an affiliated person of such Fund, the Adviser or any Sub-Adviser of such Fund. Payments to Affiliates. During each Fund’s last fiscal year, no Fund made any material payments to the Adviser or Sub-Adviser to such Fund or any affiliated person of the Adviser or Sub-Adviser to such Fund for services provided to the Fund (other than pursuant to the Current Advisory Agreement, Current Sub-Advisory Agreement, Administration Agreement, or fees paid to the Distributor or Janus Services as described herein). Shareholder Approval To become effective with respect to a Fund, each New Advisory Agreement requires the affirmative vote of a 1940 Act Majority (as defined herein) of such Fund, with all classes of shares voting together as a single class. For purposes of determining the approval of the New Advisory Agreement, abstentions and broker non-votes will have the same effect as shares voted against the proposal. An unfavorable vote on the proposal to approve the New Advisory Agreement by the shareholders of one Fund will not affect the implementation of the proposal by another Fund if the proposal is approved by the shareholders of that Fund. However, the New Advisory Agreement will only take effect upon the closing of the Transaction, which is conditioned upon obtaining the approval of new advisory agreements by shareholders of Janus funds representing a specified percentage of assets under management. In the event that the Transaction does not, for any reason, occur, each Current Advisory Agreement will continue in effect in accordance with its terms. The Board unanimously recommends that shareholders of each Fund vote FOR approval of the Fund’s New Advisory Agreement. 8
PROPOSAL 2 APPROVAL OF NEW INVESTMENT SUB-ADVISORY AGREEMENT WITH CURRENT SUB-ADVISER (Sub-Advised Funds) Background For Janus Aspen INTECH U.S. Low Volatility Portfolio (the “INTECH Fund”), the Adviser has retained INTECH, an indirect wholly-owned subsidiary of the Adviser, as sub-adviser to manage the assets of the Fund. For Janus Aspen Perkins Mid Cap Value Portfolio (the “Perkins Fund”), the Adviser has retained Perkins, an indirect wholly-owned subsidiary of the Adviser, as sub-adviser to manage the assets of the Fund. The Adviser has entered into (i) an investment sub-advisory agreement with INTECH with respect to the INTECH Fund (the “Current INTECH Sub-Advisory Agreement”), and (ii) an investment sub-advisory agreement with Perkins with respect to the Perkins Fund (the “Current Perkins Sub-Advisory Agreement”). Collectively, the Current INTECH Sub-Advisory Agreement and the Current Perkins Sub-Advisory Agreement are referred to herein as the “Current Sub-Advisory Agreements” and each as a “Current Sub-Advisory Agreement.” The Current INTECH Sub-Advisory Agreement is dated September 6, 2012, and was last approved by Janus as the initial shareholder of the INTECH Fund on that same date. The Current Perkins Sub-Advisory Agreement is dated December 31, 2008, and was last approved by the sole shareholder of the Perkins Fund on October 30, 2008. The Board most recently approved continuance of each Current Sub-Advisory Agreement at its meeting on December 8, 2016. As with the Current Advisory Agreements, each Current Sub-Advisory Agreement, as required by Section 15 of the 1940 Act, provides for its automatic termination in the event of its assignment. Each of INTECH and Perkins is a direct wholly-owned subsidiary of the Adviser. Therefore, the consummation of the Transaction may be deemed an “assignment” of each Current Sub-Advisory Agreement. In addition, each Current Sub-Advisory Agreement provides that it will terminate upon the termination of the Current Advisory Agreement with respect to such Fund. As a result, the consummation of the Transaction would result in the termination of each Current Sub-Advisory Agreement. The 1940 Act requires that each New Sub-Advisory Agreement be approved by the Fund’s shareholders in order for it to become effective. The Proposal Shareholders of the INTECH Fund are being asked to approve a new sub-advisory agreement between the Adviser and INTECH (the “New INTECH Sub-Advisory Agreement”), and shareholders of the Perkins Fund are being asked to approve a new sub-advisory agreement between the Adviser and Perkins (the “New Perkins Sub-Advisory Agreement” and, together with the New INTECH Sub-Advisory Agreement, each a “New Sub-Advisory Agreement” and collectively, the “New Sub-Advisory Agreements”). Each New Sub-Advisory Agreement will be substantially similar to the Current Sub-Advisory Agreement for each Fund. At the December 8, 2016 Board meeting, and for the reasons discussed below (see “Board Considerations” after proposal 2 in this Proxy Statement), the Board, including the Independent Trustees, unanimously approved the New Sub-Advisory Agreement on behalf of each applicable Fund and unanimously recommended approval of the New Sub-Advisory Agreement by shareholders. For additional information regarding the Board’s consideration of the New Sub-Advisory Agreements, see “Board Considerations” after proposal 2 in this Proxy Statement. The form of the New INTECH Sub-Advisory Agreement is attached hereto asAppendix M to this Proxy Statement. The form of the New Perkins Sub-Advisory Agreement is attached hereto asAppendix N to this Proxy Statement. Because each New Sub-Advisory Agreement, like each Current Sub-Advisory Agreement, is between the Adviser and the Sub-Adviser, a Fund’s New Sub-Advisory Agreement will not take effect until the New Advisory Agreement for such Fund has been approved by shareholders. 9
Comparison of Current Sub-Advisory Agreements and New Sub-Advisory Agreements The terms of each New Sub-Advisory Agreement are substantially similar to those of the corresponding Current Sub-Advisory Agreement. There is no change in the fee rate payable by the Adviser to the Sub-Adviser. If approved by shareholders of a Fund, the New Sub-Advisory Agreement for the Fund will have an initial term through February 1, 2018 and will continue in effect from year to year thereafter if such continuance is approved for the Fund at least annually in the manner required by the 1940 Act and the rules and regulations thereunder. Below is a comparison of certain terms of the Current Sub-Advisory Agreements to the terms of the New Sub-Advisory Agreements. Sub-Advisory Services. Under the terms of the agreements, the sub-advisory services provided by the Sub-Adviser to each Fund under the New Sub-Advisory Agreements and to be provided under the Current Sub-Advisory Agreements are the same. Both the Current Sub-Advisory Agreements and New Sub-Advisory Agreements provide that the Sub-Adviser shall manage the investment operation of the Fund and the composition of its investment portfolio, shall determine without prior consultation with the Trust or the Adviser, what securities and other assets of the Fund will be acquired, held, disposed of or loaned, and place orders or direct the Adviser to place orders, for the purchase or sale of such securities or other assets with brokers, dealers or others, all in conformity with the investment objectives, policies and restrictions and the other statements concerning the Fund in the Trust’s Amended and Restated Trust Instrument, as then in effect, the Trust’s Bylaws, as then in effect, and the registration statement of the Trust, and to provisions of the Internal Revenue Code, as applicable to each Fund as a regulated investment company. The Sub-Adviser shall cause its officers to attend meetings and furnish oral and written reports, as each Fund may reasonably require, in order to keep the Trustees and appropriate officers of each Fund fully informed as to the condition of the investment portfolio of each Fund. Additionally, the Sub-Adviser shall furnish reports as may be reasonably requested by the Board or the Adviser, including, but not limited to reports relating to the valuation of the Fund’s assets. Fees. Under both the Current Sub-Advisory Agreements and New Sub-Advisory Agreements, the Adviser pays the Sub-Adviser the same sub-advisory fee rate of half of the investment advisory fee rate the Adviser receives from the Fund. The Adviser pays INTECH a sub-advisory fee rate equal to 50% of the investment advisory fee paid by the INTECH Fund to the Adviser (calculated after any fee waivers and expense reimbursement). The Adviser pays Perkins a sub-advisory fee equal to 50% of the investment advisory fee paid by the Perkins Fund to the Adviser (plus or minus half of any performance fee adjustment, and net of any reimbursement of expenses incurred or fees waived by the Adviser). The sub-advisory fee paid by the Adviser to Perkins adjusts up or down based on the Perkins Fund’s performance relative to the Perkins Fund’s benchmark index over the performance measurement period. Information regarding the fees paid by the Adviser to the Sub-Adviser with respect to each Fund during each Fund’s last fiscal year are set forth inAppendix F to this Proxy Statement. Payment of Expenses. Under each Current Sub-Advisory Agreement and New Sub-Advisory Agreement, the Sub-Adviser agrees to pay its own costs and expenses incurred in rendering its services. Limitation on Liability. The Current Sub-Advisory Agreements and New Sub-Advisory Agreements provide that the Sub-Adviser will not be liable for, and the Adviser will not take any action against the Sub-Adviser to hold the Sub-Adviser liable for, any error of judgment or mistake of law or for any loss arising out of any investment or for any act or omission taken with respect to the Fund except for willful misfeasance, bad faith or gross negligence in the performance of its duties, or by reason of its reckless disregard of its obligations and duties under the agreement and except to the extent otherwise provided by law. Continuance. The Current Sub-Advisory Agreement for each Fund continues in effect for successive one-year periods after its initial term, if such continuance is approved in the manner required by the 1940 Act. The New Sub-Advisory Agreement for each Fund will have an initial term until February 1, 2018, and will continue thereafter for successive one-year periods if approved annually in the same manner required under the Current Sub-Advisory Agreement. Termination. The Current INTECH Sub-Advisory Agreements and New INTECH Sub-Advisory Agreements provide that the agreement may be terminated at any time, without penalty, by the Board, or by the shareholders of the Fund acting by vote of at least a majority of its outstanding voting securities, provided in either case that sixty (60) days’ advance written notice of termination be given to INTECH at its principal place of 10
business. Further, the Current INTECH Sub-Advisory Agreements and New INTECH Sub-Advisory Agreements provide that the agreement may be terminated (i) by the Adviser or by INTECH at any time, without penalty, by giving sixty (60) days’ advance written notice of termination to the other party, or (ii) by the Adviser or the Trust without advance notice if INTECH becomes unable to discharge its duties and obligations under the agreement. In addition, a Fund’s Current INTECH Sub-Advisory Agreement and New INTECH Sub-Advisory Agreement shall terminate, without penalty, upon termination of the Current Advisory Agreement or New Advisory Agreement, as applicable, of such Fund. The Current Perkins Sub-Advisory Agreements and New Perkins Sub-Advisory Agreements provide that the agreement may be terminated at any time, without penalty, by the Board, or by the shareholders of a Fund acting by vote of at least a majority of its outstanding voting securities, provided in either case that sixty (60) days’ advance written notice of termination be given to Perkins at its principal place of business. Further, the Current Perkins Sub-Advisory Agreements and New Perkins Sub-Advisory Agreements provide that the agreement may be terminated (i) by the Adviser at any time, without penalty, by giving sixty (60) days’ advance written notice of termination to Perkins; (ii) by Perkins at any time, without penalty, by giving ninety (90) days’ advance notice to the Adviser and the Trust, unless the Adviser or the Trust requests additional time to find a replacement for Perkins, in which case Perkins shall allow the additional time requested by the Adviser or the Trust not to exceed ninety (90) days’ beyond the initial 90 days’ notice period unless otherwise agreed to by the Adviser, the Trust and Perkins; or (iii) by the Adviser or the Trust without advance notice if Perkins becomes unable to discharge its duties and obligations under the agreement. In addition, a Fund’s Current Perkins Sub-Advisory Agreement and New Perkins Sub-Advisory Agreement shall terminate, without penalty, upon termination of the Current Advisory Agreement or New Advisory Agreement, as applicable, of such Fund. Interim Sub-Advisory Agreements In the event shareholders of a Fund do not approve such Fund’s New Advisory Agreement and/or New Sub-Advisory Agreement at the Meeting prior to the closing of the Transaction, an interim sub-advisory agreement between the Adviser and the applicable Sub-Adviser (each an “Interim Sub-Advisory Agreement” and collectively, the “Interim Sub-Advisory Agreements”) will take effect upon the closing of the Transaction. At the December 8, 2016 meeting, the Board, including the Independent Trustees, unanimously approved an Interim Sub-Advisory Agreement for the INTECH Fund and the Perkins Fund in order to assure continuity of sub-advisory services to these sub-advised Funds after the Transaction. The terms of each Interim Sub-Advisory Agreement are substantially identical to those of the Current Sub-Advisory Agreements and New Sub-Advisory Agreements, except for the term and escrow provisions described below. The Interim Sub-Advisory Agreement will continue in effect for a term ending on the earlier of 150 days from the closing of the Transaction (the “150-day period”) or when shareholders of a Fund approve the New Advisory Agreement and New Sub-Advisory Agreement. Pursuant to Rule 15a-4 under the 1940 Act, compensation earned by a Sub-Adviser under an Interim Sub-Advisory Agreement will be held in an interest-bearing escrow account. If shareholders of a Fund approve the New Advisory Agreement and New Sub-Advisory Agreement prior to the end of the 150-day period, the amount held in the escrow account under the Interim Sub-Advisory Agreement will be paid to the Sub-Adviser. If shareholders of a Fund do not approve the New Advisory Agreement and/or New Sub-Advisory Agreement prior to the end of the 150-day period, the Board will take such action as it deems to be in the best interests of the Fund, and the Sub-Adviser will be paid the lesser of its costs incurred in performing its services under the Interim Sub-Advisory Agreement or the total amount in the escrow account, plus interest earned. Information About the Sub-Advisers INTECH. INTECH serves as investment sub-adviser to the INTECH Fund, a series of the Trust. INTECH is organized as a Delaware limited liability company and is an independently managed direct wholly-owned subsidiary of the Adviser and an indirect subsidiary of Janus. INTECH is a global asset manager with one of the industry’s longest continuous performance records of mathematical equity investment strategies for institutional investors and $48.2 billion in assets under management as of September 30, 2016. INTECH’s global headquarters is located in West Palm Beach, Florida, with its research headquarters in Princeton, New Jersey, and an international headquarters in London. The business address of INTECH is 525 Okeechobee Blvd., Suite 1800, West Palm Beach, Florida 33401. 11
INTECH’s operations will be unaffected by the Transaction. INTECH’s CEO will continue to report to the Board of Directors of INTECH. Perkins. Perkins serves as investment sub-adviser to the Perkins Fund, a series of the Trust. Perkins is organized as a Delaware limited liability company and is a direct wholly-owned subsidiary of the Adviser and an indirect subsidiary of Janus. Perkins is a value equity manager that uses a bottom-up approach to build diversified portfolios of what it believes to be high quality, undervalued stocks with favorable reward-to-risk characteristics. As of September 30, 2016, Perkins had approximately $9.4 billion in assets under management. The business address for Perkins is 311 S. Wacker Drive, Suite 6000, Chicago, Illinois 60606. Perkins’s operations will be unaffected by the Transaction. Perkins’s CEO will continue to report to the Board of Directors of Perkins. Additional Information. Certain information regarding the executive officers and directors of each Sub-Adviser is set forth inAppendix E to this Proxy Statement. Shareholder Approval To become effective with respect to a Fund, the New Sub-Advisory Agreement must be approved by a 1940 Act Majority (defined earlier) of the Fund, with all classes of shares voting together as a single class. For purposes of determining the approval of each New Sub-Advisory Agreement, abstentions and broker non-votes will have the same effect as shares voted against the proposal. An unfavorable vote on the proposal to approve the New Sub-Advisory Agreement by the shareholders of one Fund will not affect the implementation of the proposal by another Fund if the proposal is approved by the shareholders of that Fund. However, the New Sub-Advisory Agreement for each Fund will only take effect upon the closing of the Transaction, which is conditioned upon obtaining the approval by shareholders of Janus funds representing a specified percentage of assets under management. In addition, each New Sub-Advisory Agreement will only take effect if a New Advisory Agreement for a Fund has been approved by shareholders. In the event that the Transaction does not, for any reason, occur, each Current Sub-Advisory Agreement will continue in effect in accordance with its terms. The Board unanimously recommends that shareholders of each Fund vote FOR approval of the New Sub-Advisory Agreement for their Fund. 12
BOARD CONSIDERATIONS On September 15, 2016, Janus advised the Board of its intent to seek a strategic combination of its advisory business with Henderson. The Board met with the Chief Executive Officer of Janus, who outlined the proposed combination and the potential benefits to Janus Capital and the Funds. Subsequent to the September 15, 2016 meeting, the Trustees identified a list of basic principles, which they believed should serve as the foundation for their review of the organizational, operational and strategic issues involved with any potential change in control of Janus Capital, the investment adviser to the Funds. These basic principles were communicated to Janus Capital on September 27, 2016, and were intended to be shared with Henderson. On October 3, 2016, Janus announced that it had entered into a definitive Agreement and Plan of Merger with Henderson pursuant to which Janus and Henderson agreed to effect an all-stock merger of equals strategic combination of their respective businesses, with Janus Capital surviving the merger as a direct wholly-owned subsidiary of Henderson (the “Transaction”). The Board was advised that, subject to certain conditions, the Transaction is currently expected to close by the second quarter of 2017. As part of its due diligence, the Board developed an initial list of questions related to the proposed transaction, which was provided to Janus Capital on October 6, 2016. At a special Board meeting held on October 19, 2016, the Board considered Janus Capital’s response to the initial information request and met with the management of Janus to discuss the impact of the Transaction on the nature, extent and quality of services Janus Capital is expected to provide to the Funds following the Transaction, addressing, among other matters, the personnel expected to provide such services, and the resources available to do so. After its October 19, 2016 meeting, the Board developed a supplemental request for additional information, which was provided to Janus Capital on October 26, 2016. At another special Board meeting held on November 7-8, 2016, the Board considered Janus Capital’s response to the supplemental information request and again met with the management of Janus and Henderson to discuss the impact of the Transaction on the nature, extent and quality of services Janus Capital is expected to provide to the Funds following the Transaction, and also met with various officers of the Funds and of Janus Capital including various Fund portfolio managers. After its November 7-8, 2016 meeting, the Board developed a second supplemental request for additional information, which was provided to Janus Capital on November 21, 2016. On December 7-8, 2016, the Board met to consider Janus Capital’s response to the second supplemental information request and to also consider the proposed New Advisory Agreement for each Fund and the New Sub-Advisory Agreement for Funds managed by INTECH or Perkins. During each of these meetings, the Board sought additional and clarifying information as it deemed necessary or appropriate. Throughout the process, the Board had the assistance of its independent legal counsel, who advised them on, among other things, its duties and obligations. In connection with the Board’s review, Janus Capital provided, and the Board obtained, substantial information regarding the following matters: the management, financial position and business of Henderson; the history of Henderson’s business and operations; the investment performance of the investment companies advised by Henderson; the proposed structure, operations and investment processes of the combined investment management organization after the Transaction and the strategy for operating and growing the business following the Transaction; the future plans of Janus and Henderson with respect to the Funds and any proposed changes to the operations or structure of the Funds; and the future plans of Janus and Henderson with respect to the provision of services to the Funds, and the entities providing such services, including those affiliated with Janus. The Board also received information regarding the terms of the Transaction, anticipated management of the combined organization, the resources that each of Janus and Henderson bring to the combined organization and the process being followed by Janus and Henderson to integrate their organizations. The Board also received information regarding the impact of the Transaction on each of INTECH and Perkins. In connection with the Board’s approval of New Advisory Agreements and New Sub-Advisory Agreements at its December 8, 2016 meeting, the Board also continued its on-going annual process to determine whether to continue the Current Advisory Agreements and the Current Sub-Advisory Agreements. In this regard, the Board received and reviewed information provided by Janus and the respective Sub-Advisers in response to requests of the Board and its independent legal counsel. The Board also received and reviewed information and analysis provided by, and in response to requests of, its independent fee consultant. The Board noted that as part of this annual process, the Board had considered and was in the process of considering, numerous factors, including the nature and quality of services provided by Janus Capital and each Sub-Adviser, as applicable; investment performance, on an absolute basis and relative to appropriate peer groups and one or a combination of market indices; investment management fees, expense ratios and asset sizes of the Funds and peer groups; Janus Capital’s profitability from managing the Funds;fall-out benefits to Janus 13
Capital from its relationship to the Funds, including revenues derived from services provided to the Funds by affiliates of Janus Capital; and the potential benefits to Janus Capital, the Funds of receiving research services from broker/dealer firms in connection with the allocation of portfolio transactions to such firms. In determining whether to approve the New Advisory Agreement for each Fund and the New Sub-Advisory Agreement for Funds managed by INTECH or Perkins in connection with the Transaction, and whether to recommend approval to Fund shareholders, the Board received information and made inquiries into all matters as it deemed appropriate. The Board reviewed and analyzed various factors it deemed relevant, including the following factors, among others, none of which by itself was considered dispositive: The terms of the New Advisory Agreements are substantially similar to the corresponding Current Advisory Agreements, and the contractual fee rate will not change. The terms of the New Sub-Advisory Agreements are substantially similar to the corresponding Current Sub-Advisory Agreements, and the contractual fee rate will not change. Janus Capital’s plans for the operation of the Funds, including its plans for the continued provision of all services currently provided to the Funds by Janus Capital and its affiliates, including, among others, investment advisory services, portfolio trading services, and Fund administrative and accounting services, and the personnel and resources proposed to support the provision of such services. The estimated profitability to Janus Capital from managing the Funds after the Transaction, including potential economies of scale andfall-out benefits to Janus Capital from its relationship to the Funds, including revenues derived from services provided to the Funds by affiliates of Janus Capital, and the potential benefits to Janus Capital, and the Funds of receiving research services from broker/dealer firms in connection with the allocation of portfolio transactions to such firms. In connection with its deliberations, the Board received assurances from Janus, on behalf of itself and its affiliates (collectively, “Janus”) including the following: Janus has provided to the Board such information as it believes is reasonably necessary to evaluate the New Advisory Agreements and New Sub-Advisory Agreements. Janus is committed to the continuance, without interruption, of services to the Funds of at least the type and quality currently provided by Janus Capital and its affiliates, or superior thereto. The Transaction is not expected to affect negatively the nature, extent or quality of the investment advisory services provided by Janus Capital to the Funds following the Transaction, and the investment advisory services are expected to be at least comparable to the services being provided under the Current Advisory Agreements and Current Sub-Advisory Agreements. In this regard, the Board noted specific representations that Janus does not intend for the nature, extent or quality of investment advisory and other services to be provided to the Funds following the Transaction to change, and the extent of such services were expected to increase based on the combined resources of the combined investment management organization after the Transaction, and should the nature, extent or quality of such services decline, Janus would commit the resources needed to return such services to pre-Transaction levels. The Funds’ current operations were expected to remain largely unchanged, except for certain fund reorganizations which will be separately considered by the Board, and such other changes as were or will be presented to the Board. The Transaction is not expected to result in any changes to the portfolio managers providing services to the Funds. After the Transaction, the distribution and marketing services provided to the Funds were expected to be improved or enhanced based on the combined resources of Janus and Henderson. 14
The intent of Janus Capital to take the necessary and appropriate steps to retain and attract key investment advisory personnel. The intent of Janus to take the necessary and appropriate steps to retain and attract key compliance, financial, fund accounting and administrative personnel supporting the management and oversight of the Funds. Janus is not aware of any express or implied term, condition, arrangement or understanding that would impose in its best judgement an “unfair burden” on any Fund as a result of the Transaction, as defined in Section 15(f) of the 1940 Act, and that Janus will take no action that would have the effect of imposing such an “unfair burden” on any Fund in connection with the Transaction. Janus assured the Board that it intended to comply with Section 15(f) of the 1940 Act. Section 15(f) provides anon-exclusive safe harbor for an investment adviser to an investment company or any of its affiliated persons to receive any amount or benefit in connection with a change in control of the investment adviser so long as two conditions are met. First, for a period of three years after the transaction, at least 75% of the board members of the investment company must not be Interested Persons of such investment adviser. The composition of the Board is in compliance with this provision of Section 15(f). In addition, after careful review and consideration, the Board determined that it would be in the best interests of the Funds to add to the Board an individual who currently acts as a non-interested board members of the Henderson Trust. The Board believes that this change in the Board composition will provide perspective and insight relating to experience working with the Henderson organization. The Board’s Nominating and Governance Committee considered a number of candidates and recommended that the Board nominate one proposed new trustee from those candidates who currently act as non-interested board members of the Henderson Trust. The Board approved that trustee nominee to serve on the Board, subject to election by the shareholders of the Funds and contingent on the close of the Transaction. If the new trustee is elected and serves on the Board, the Board composition would continue to satisfy the provisions of Section 15(f). To meet the second condition of Section 15(f), an “unfair burden” must not be imposed upon the investment company as a result of such transaction or any express or implied terms, conditions or understandings applicable thereto. The term “unfair burden” is defined in Section 15(f) to include any arrangement during thetwo-year period after the transaction, whereby the investment adviser, or any interested person of such adviser, receives or is entitled to receive any compensation, directly or indirectly, from the investment company or its shareholders (other than fees for bona fide investment advisory or other services) or from any person in connection with the purchase or sale of securities or other property to, from or on behalf of the investment company (other than bona fide ordinary compensation as principal underwriter for such investment company). Janus represented that it does not believe that an “unfair burden” will be placed on the Funds as a result of the Transaction. In furtherance thereof, Janus has undertaken to pay the costs of preparing and distributing proxy materials to, and of holding the Meetings of, the Funds’ shareholders, as well as other fees and expenses in connection with the Transaction, including the reasonable fees and expenses of legal counsel and consultants to the Funds and the Trustees. In addition, Janus has agreed, for a period of two years following the closing of the Transaction, (i) not to request any increases to advisory fees for the Funds, other than those proposed to and approved by the Board prior to the close of the Transaction, and (ii) to continue to use the current process by which expense caps are set annually for the Funds. As a result of its review and consideration of the New Investment Advisory Agreements and New Sub-Advisory Agreements in connection with the Transaction, at a meeting on December 8, 2016, the Board voted unanimously to approve a New Investment Advisory Agreement for each Fund and a New Sub-Advisory Agreement for each Fund managed by INTECH or Perkins, and to recommend such agreements to the Funds’ shareholders for their approval. 15
PROPOSAL 3 APPROVAL OF AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT – CHANGE TO PERFORMANCE ADJUSTMENT (For Janus Portfolio) Background Pursuant to the Current Advisory Agreement between Janus Capital and the Trust on behalf of Janus Portfolio (for purposes of this Proposal 3, the “Fund” refers to Janus Portfolio), Janus Capital serves as the Fund’s investment adviser. The date of the Fund’s Current Advisory Agreement and the date on which it was last approved by shareholders and approved for continuance by the Board are provided inAppendix B to this Proxy Statement. Pursuant to the Fund’s Current Advisory Agreement, the Fund pays Janus Capital a performance-adjusted investment advisory fee. The calculation of the performance adjustment applies as follows: Investment Advisory Fee = Base Fee Rate +/– Performance Adjustment. The Performance Adjustment is determined based on the Fund’s performance relative to the cumulative investment record of its benchmark index (the “Performance Fee Benchmark”) over a rolling 36-month performance measurement period, with incremental adjustments up or down to the advisory fee rate based on the amount of such outperformance or underperformance (the “Performance Hurdle”). As described below, in connection with certain proposed changes to the Fund’s investment strategy, Janus Capital has proposed, and the Board of Trustees has approved, an amended and restated investment advisory agreement (the “Amended Advisory Agreement”) that reflects a change to the Performance Hurdle and Performance Fee Benchmark for the Fund. The 1940 Act and staff of the SEC require Fund shareholders to approve material amendments to an investment advisory agreement in order to become effective. Fund Realignment The Fund has the same investment strategies as Janus Fund, a series of Janus Investment Fund (the “JIF Janus Fund”). The Board of Trustees of Janus Investment Fund has approved a merger of the JIF Janus Fund into Janus Research Fund, also a series of Janus Investment Fund (“JIF Research Fund”). Accordingly, if approved by the JIF Janus Fund’s shareholders, JIF Janus Fund will merge with and into JIF Research Fund and JIF Janus Fund will be terminated and liquidated. In order to streamline the Janus product lineup and to more efficiently manage its portfolios, Janus Capital has proposed, and the Board of Trustees of the Fund has approved, changes to the name, principal investment strategies and portfolio management team of the Fund to align the Fund with the investment approach of JIF Research Fund (collectively, the “Realignment”). The Realignment does not require shareholder approval. If the proposed merger of JIF Janus Fund into JIF Janus Research Fund is completed, but the Amended Advisory Agreement is not approved, the Board will reconsider whether to implement the Realignment and take such actions as it deems to be in the best interest of Janus Portfolio. Name Change. The name of the Fund would be changed from “Janus Portfolio” to “Janus Research Portfolio” (or “Janus Henderson Research Portfolio,” assuming the Transaction is completed). Investment Strategy Changes. The principal investment strategies of the Fund would be changed as follows: Investment Approach. The Fund would continue to focus on a portfolio of large cap common stocks, with the ability to invest in companies of any size. Following the Realignment, the Fund would apply an investment process in which a team of the Adviser’s equity research analysts, overseen by the Portfolio Oversight Team led by the Adviser’s Director of Research (the “Research Team”), selects investments that represent the Research Team’s high-conviction investment ideas in all market capitalizations and styles and expects to be broadly diversified among a variety of industry sectors, whereas the Fund’s current investment process, while utilizing ideas of the Research Team, is based on several portfolio managers applying their “bottom up” approach to selecting investments, which may result in broad diversification among industry sectors. The Fund does not currently have a formal policy to balance sector weightings, however, following the Realignment, securities held by the Fund may be sold to 16
rebalance sector weightings. It is currently anticipated that transaction costs associated with portfolio repositioning transactions related to the Realignment will not have a material impact on the Fund. In addition, while the Fund has the ability to lend securities, it typically has not done so. JIF Research Fund does engage in securities lending and it is anticipated that the Fund may also engage in securities lending. Principal Investment Strategies. The following is intended to show the primary similarities and differences between the current principal investment strategies and those that would be implemented following the Realignment. | | | Current Investment Strategies | | Post-Realignment Investment Strategies | General Strategy, Company Size and Geographic Distribution | The Fund pursues its investment objective primarily by investing in common stocks selected for their growth potential. Although the Fund may invest in companies of any size, it generally invests in larger, more established companies. | | The Fund pursues its investment objective primarily by investing in common stocks selected for their growth potential. The fund may invest in companies of any size, from larger, well-established companies to smaller, emerging growth companies. | The Fund may invest in foreign securities, which may include investments in emerging markets. | | Although the Research Team may find high-conviction investment ideas anywhere in the world, the Research Team emphasizes investments in securities of U.S.-based issuers. | Investment Approach | The portfolio managers of the Fund apply a “bottom up” approach in choosing investments. In other words, the portfolio managers look at companies one at a time to determine if a company is an attractive investment opportunity and if it is consistent with the Fund’s investment policies. | | The Adviser’s equity research analysts, overseen by the Portfolio Oversight Team led by the Adviser’s Director of Research (“Research Team”), select investments for the fund that represent the Research Team’s high-conviction investment ideas in all market capitalizations and styles. The Research Team, comprised of sector specialists, conducts a fundamental analysis with a focus on “bottom up” research, quantitative modeling, and valuation analysis. Using this research process, analysts rate their stocks based upon attractiveness. Analysts bring their high conviction ideas to their respective sector teams. Sector teams compare the appreciation and risk potential of each of the team’s high-conviction ideas and construct a sector portfolio that is intended to maximize the best risk-reward opportunities. The Fund may sell positions when, among other things, there is no longer high conviction in the return potential of the investment or if the risk characteristics have caused a re-evaluation of the opportunity. This may occur if the stock has appreciated and reflects the anticipated value, if another company represents a better risk-reward opportunity, or if the investment’s fundamental characteristics deteriorate. The Fund may sell securities from the portfolio to rebalance sector weightings. It is expected that the Fund will be broadly diversified among a variety of industry sectors. The Fund intends to be fully invested under normal circumstances. However, under unusual circumstances, if the Fund’s Research Team does not have high conviction in enough investment opportunities, the Fund’s uninvested assets may be held in cash or similar instruments. |
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Portfolio Manager Changes. Currently, co-portfolio managers Jean Barnard and Burton H. Wilson jointly share responsibility for the day-to-day management of Janus Portfolio, with no limitation on the authority of one co-portfolio manager in relation to the other. Following the Realignment, the Research Team (Janus Capital’s equity research analysts overseen by the Portfolio Oversight Team led by Carmel Wellso) will select investments for the Fund and Carmel Wellso will be responsible for the day-to-day management of the Fund. Carmel Wellso is the Adviser’s Director of Research and Executive Vice President of Janus Research Fund. Ms. Wellso is also portfolio manager of other Janus accounts. She joined Janus Capital in June 2008 as a research analyst. Ms. Wellso holds a Bachelor’s degree in English Literature and Business Administration from Marquette University and a Master’s degree from the Thunderbird School of Global Management. Board Approval. The changes to the Fund’s name, principal investment strategies and portfolio management team do not require shareholder approval in order to become effective. At a meeting of the Board of Trustees held December 8, 2016, the Board, for the reasons discussed below, unanimously approved the changes to the Fund’s name, principal investment strategies and related matters, subject to the completion of the merger of JIF Janus Fund into JIF Research Fund. Proposed Changes to Performance Fee Adjustment Calculation In connection with the Realignment, the Board has approved the Amended Advisory Agreement that reflects a change to the Performance Hurdle and the Performance Fee Benchmark for the Fund. The Board met at a series of meetings, including meetings of certain committees thereof, commencing with an in person meeting of the Board on October 19, 2016 and concluding with an in person meeting of the Board on December 8, 2016, for purposes of, among other things, considering whether to approve the Amended Advisory Agreement. Pursuant to the Fund’s Current Advisory Agreement and proposed Amended Advisory Agreement, the Fund pays Janus Capital a performance-adjusted investment advisory fee. The calculation of the performance adjustment applies as follows: Investment Advisory Fee = Base Fee Rate +/– Performance Adjustment. Under both the Current Advisory Agreement and the Amended Advisory Agreement, the investment advisory fee rate consists of two components: (1) a base fee calculated by applying the contractual fixed rate of the advisory fee, 0.64%, to the Fund’s average daily net assets during the previous month (“Base Fee Rate”), plus or minus (2) a performance-fee adjustment (“Performance Adjustment”) calculated by applying a variable rate of up to 0.15% (positive or negative) to the Fund’s average daily net assets based on the Fund’s relative performance to the cumulative investment record of its Performance Fee Benchmark over a 36-month performance measurement period. Under both the Current Advisory Agreement and the Amended Advisory Agreement, incremental adjustments up or down to the advisory fee rate are determined based on the amount of such outperformance or underperformance (the “Performance Hurdle”). In connection with the Realignment, it is proposed that the Performance Adjustment calculation for the Fund be modified by changing the Performance Hurdle and Performance Fee Benchmark. A comparison of the current and proposed Performance Hurdle and Performance Fee Benchmark is as follows: | | | | | | | Current Advisory Agreement | | Amended Advisory Agreement | Performance Hurdle | | +/- 4.50% | | +/- 5.00% | Performance Fee Benchmark | | Core Growth Index | | Russell 1000 Growth Index |
The Core Growth Index is an internally-calculated, hypothetical index that combines total returns from the Russell 1000 Growth Index (50%) and the nominationsS&P 500 Index (50%). The S&P 500 Index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The Russell 1000 Growth Index is designed to track the performance of the large capitalization growth segment of the United States equity market. 18
The Russell 1000 Growth Index is designed to track the performance of the large capitalization growth segment of the United States equity market. As an example, if the Fund outperformed its Performance Fee Benchmark over the 36-month performance measurement period by its Performance Hurdle (+/- 4.50% under the Current Advisory Agreement and +/- 5.00% under the Amended Advisory Agreement), the advisory fee rate would increase by 0.15% (assuming constant assets). Conversely, if the Fund underperformed its Performance Fee Benchmark over the performance measurement period by its Performance Hurdle, the advisory fee rate would decrease by 0.15% (assuming constant assets). Actual performance within the full range of the Performance Hurdle rate may result in positive or negative incremental adjustments to the advisory fee rate of greater or less than 0.15%. The methodology by which the Performance Adjustment is calculated will not change. No Performance Adjustment is applied unless the difference between the Fund’s investment performance and the cumulative investment record of the Performance Fee Benchmark is 0.50% or greater (positive or negative) during the previous 36 months. The Base Fee Rate is subject to an upward or downward Performance Adjustment for every full 0.50% increment by which the Fund outperforms or underperforms its Performance Fee Benchmark. Because the Performance Adjustment is tied to the Fund’s relative performance compared to its Performance Fee Benchmark (and not its absolute performance), the Performance Adjustment could increase the Adviser’s fee even if the Fund’s shares lose value during the performance measurement period and could decrease the Adviser’s fee even if the Fund’s shares increase in value during the performance measurement period. For purposes of computing the Base Fee Rate and the Performance Adjustment, net assets are averaged over different periods (average daily net assets during the previous month for the Base Fee Rate versus average daily net assets during the performance measurement period for the Performance Adjustment). Performance of the Fund is calculated net of expenses, whereas the Fund’s Performance Fee Benchmark does not have any fees or expenses. Reinvestment of dividends and distributions is included in calculating both the performance of the Fund and its Performance Fee Benchmark. The Base Fee Rate is calculated and accrued daily. The Performance Adjustment is calculated monthly in arrears and is accrued throughout the month. The investment advisory fee is paid monthly in arrears. Under extreme circumstances involving underperformance by a rapidly shrinking Fund, the dollar amount of the Performance Adjustment could be more than the dollar amount of the Base Fee Rate. In such circumstances, the Adviser would reimburse the Fund. The application of an expense limit, if any, will have a positive effect upon the Fund’s performance and may result in an increase in the Performance Adjustment. It is possible that the cumulative dollar amount of additional compensation ultimately payable to Janus Capital may, under some circumstances, exceed the cumulative dollar amount of management fees waived by Janus Capital. The investment performance of the Fund’s Service Shares is used for purposes of calculating the Fund’s Performance Adjustment. After Janus Capital determines whether the Fund’s performance was above or below its Performance Fee Benchmark by comparing the investment performance of the Fund’s Service Shares against the cumulative investment record of the Performance Fee Benchmark, Janus Capital applies the same Performance Adjustment (positive or negative) across each other class of shares of the Fund. If this Proposal 3 is approved, the Amended Advisory Agreement will become effective upon the completion of the merger of JIF Janus Fund into JIF Research Fund, or as soon as practicable after shareholder approval of the Amended Advisory Agreement obtained (assuming the merger of JIF Janus Fund into JIF Research Fund has been completed). For performance measurement periods prior to the effective date of the Amended Advisory Agreement, the current Performance Fee Benchmark of the Core Growth Index will be used for purposes of evaluating the Fund’s performance and calculating the investment advisory fee rate. For performance measurement periods after that date, the new Performance Fee Benchmark of the Russell 1000 Growth Index will be used for that purpose, and will be implemented on a transitional basis described under “Implementation of the Changes to the Performance Adjustment.” The Performance Hurdle rate of +/- 5.00% will take effect immediately and replace the current Performance Hurdle rate of +/- 4.50%. If shareholders do not approve the Amended Advisory Agreement, the Performance Adjustment will continue to be measured in accordance with the terms of the Current Advisory Agreement. See “Additional Information Regarding the Performance Fee Adjustment” below for more information regarding the implementation of the changes to the Performance Adjustment. 19
Appendix F to this Proxy Statement sets forth the amount of fees paid to the Adviser during each Fund’s most recently ended fiscal year. Comparison of the Current Advisory Agreement and the Amended Advisory Agreement Other than the change to the Performance Hurdle and the Performance Fee Benchmark (each as described above) and the date of execution, the only other change to the terms of the Current Advisory Agreement relates to the description of the period used for calculating the performance fee in order to allow for continuity of the fee based on the Fund’s historical performance over a 36 month measurement period. It is expected that, if approved, the merger of JIF Janus Fund into JIF Research Fund will occur prior to the Closing of the Transaction, in which case the Amended Advisory Agreement, if approved, will replace the Current Advisory Agreement. However, if the merger of JIF Janus Fund into JIF Research Fund occurs after the Closing of the Transaction, the Amended Advisory Agreement, if approved, would replace the New Advisory Agreement, if approved. Other than the change to the Performance Hurdle, Performance Fee Benchmark and date of execution, the terms of the New Advisory Agreement and the Amended Advisory Agreement would be the same. Investment Advisory Services. The investment advisory services to be provided by the Adviser to the Fund are the same under the Current Advisory Agreement and the Amended Advisory Agreement. Both the Current Advisory Agreement and Amended Advisory Agreement provide that the Adviser shall furnish continuous advice and recommendations to the Fund, and shall have authority to act with respect thereto, as to the acquisition, holding, or disposition of any or all of the securities or other assets which the Fund may own or contemplate acquiring from time to time. The Adviser shall give due consideration to the investment policies and restrictions and the other statements concerning the Fund in the Trust’s Amended and Restated Trust Instrument, as then in effect, the Trust’s Bylaws, as then in effect, and the registration statements of the Trust, and to provisions of the Internal Revenue Code, as applicable to the Fund as a regulated investment company and as a funding vehicle for variable insurance contracts. In addition, the Adviser shall cause its officers to attend meetings and furnish oral and written reports, as the Fund may reasonably require, in order to keep the Board and appropriate officers of the Fund fully informed as to the condition of the investment portfolio of the Fund. Payment of Expenses. Under the Current Advisory Agreement and the Amended Advisory Agreement, the Fund assumes and pays all expenses incidental to its organization, operations and business not specifically assumed or agreed to be paid by the Adviser. These Fund expenses include custodian and transfer agency fees and expenses, brokerage commissions and dealer spreads, and other expenses in connection with the execution of portfolio transactions, legal and accounting expenses, interest, taxes, a portion of trade association or other investment company organization dues and expenses, registration fees, expenses of shareholders’ meetings, reports to shareholders, fees and expenses of Independent Trustees, and other costs of complying with applicable laws regulating the sales of Fund shares. The Fund, along with other Janus funds, also pays some or all of the salaries, fees, and expenses of certain Fund officers and employees of the Adviser (also sharing certain expenses and salaries for the Funds’ Chief Compliance Officer and other compliance-related personnel employed by the Adviser as authorized by the Trustees from time to time). Other Services. Under the Current Advisory Agreement and Amended Advisory Agreement, the Adviser is authorized, but not obligated, to perform management and administrative services necessary for the operation of the Fund. Specifically, the Adviser is authorized to conduct relations with custodians, depositories, transfer and pricing agents, accountants, attorneys, underwriters, brokers and dealers, corporate fiduciaries, insurance company separate accounts, insurers, banks and such other persons in any such other capacity deemed by the Adviser to be necessary or desirable. The Adviser shall also generally monitor and report to the officers of the Trust regarding the Fund’s compliance with investment policies and restrictions as set forth in the currently effective prospectus and statement of additional information relating to the shares of the Fund. Additionally, the Adviser shall make reports to the Board of its performance of services upon request and furnish advice and recommendations with respect to such other aspects of the business and affairs of the Fund as the Board shall determine to be desirable. The Adviser is also authorized, subject to review by the Board, to furnish such other services as the Adviser shall from time to time determine to be necessary or useful to perform the services contemplated by the agreement. The Adviser also serves as administrator to the Fund pursuant to an Administration Agreement between Janus Capital and the Trust. See “Affiliated Service Providers, Affiliated Brokerage and Other Fees – Administrator” under Proposal 1 for additional information regarding these administrative services. 20
Limitation on Liability. The Current Advisory Agreement and Amended Advisory Agreement provide that the Adviser will not be liable for any error of judgment or mistake of law or for any loss arising out of any investment or for any act or omission taken with respect to the Fund, 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 except to the extent otherwise provided by law. Continuance. The Current Advisory Agreement for the Fund continues in effect for successive one-year periods after its initial term, if such continuance is specifically approved at least annually by (a) the vote of a majority of the Independent Trustees cast in person at a meeting called for the purpose of voting on the terms of such renewal, and (b) either the Trustees of the Trust or the affirmative vote of a majority of the outstanding voting securities of the Fund. The Amended Advisory Agreement will have an initial term until February 1, 2018, and will continue thereafter for successive one-year periods if approved annually in the same manner required under the Current Advisory Agreements. Termination. The Current Advisory Agreement and Amended Advisory Agreement for the Fund provide that the agreement may be terminated at any time, without penalty, by the Board, or by the shareholders of the Fund acting by vote of at least a majority of its outstanding voting securities, provided in either case that sixty (60) days’ advance written notice of termination be given to the Adviser at its principal place of business. Further, the Current Advisory Agreement and the Amended Advisory Agreement may be terminated by the Adviser at any time, without penalty, by giving sixty (60) days’ advance written notice of termination to the Fund, addressed to its principal place of business. Additional Information Regarding the Performance Adjustment Calculation Changes Comparison of Proposed and Current Performance Fee Benchmark Indices. The Core Growth Index is an internally-calculated, hypothetical index that combines total returns from the Russell 1000 Growth Index (50%) and the S&P 500 Index (50%). The S&P 500 Index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The Russell 1000 Growth Index is designed to track the performance of the large capitalization growth segment of the United States equity market. If the proposal is approved by shareholders, Janus Portfolio will change its Performance Fee Benchmark from the Core Growth Index to the Russell 1000 Growth Index. The following chart compares the calendar year performance of the Fund’s current and proposed Performance Fee Benchmark. The charts show how the two benchmarks have performed differently at times over this period. | | | | | Year | | Core Growth Index | | Russell 1000 Growth Index | 2016 | | | | | 2015 | | 3.51% | | 5.67% | 2014 | | 13.38% | | 13.05% | 2013 | | 32.94% | | 33.48% | 2012 | | 15.64% | | 15.26% |
The following chart shows how the monthly returns of the Fund’s Service Shares, the Core Growth Index and the Russell 1000 Growth Index have performed for the period January 1, 2014 through December 31, 2016. | | | | | | | Month | | Janus Portfolio Service Shares | | Core Growth Index | | Russell 1000 Growth Index | January 2014 | | (3.59)% | | (3.15)% | | (2.85)% | February 2014 | | 5.23% | | 4.86% | | 5.15% | March 2014 | | (1.81)% | | (0.08)% | | (1.01)% | April 2014 | | (0.89)% | | 0.37% | | 0.00% | May 2014 | | 3.60% | | 2.73% | | 3.12% | June 2014 | | 2.39% | | 2.01% | | 1.95% | July 2014 | | (1.74)% | | (1.45)% | | (1.53)% | August 2014 | | 4.85% | | 4.29% | | 4.58% | September 2014 | | (1.87)% | | (1.43)% | | (1.45)% |
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| | | | | | | October 2014 | | 3.26% | | 2.54% | | 2.64% | November 2014 | | 3.34% | | 2.93% | | 3.17% | December 2014 | | (0.22)% | | (0.65)% | | (1.04)% | January 2015 | | (0.26)% | | (2.27)% | | (1.53)% | February 2015 | | 7.15% | | 6.21% | | 6.67% | March 2015 | | (0.61)% | | (1.36)% | | (1.14)% | April 2015 | | (0.48)% | | 0.73% | | 0.50% | May 2015 | | 1.99% | | 1.35% | | 1.41% | June 2015 | | (2.12)% | | (1.85)% | | (1.76)% | July 2015 | | 3.85% | | 2.74% | | 3.39% | August 2015 | | (6.94)% | | (6.05)% | | (6.07)% | September 2015 | | (3.41)% | | (2.47)% | | (2.47)% | October 2015 | | 6.84% | | 8.52% | | 8.61% | November 2015 | | 1.39% | | 0.29% | | 0.28% | December 2015 | | (1.53)% | | (1.52)% | | (1.47)% | January 2016 | | (6.81)% | | (5.27)% | | (5.58)% | February 2016 | | (0.82)% | | (0.09)% | | (0.04)% | March 2016 | | 6.15% | | 6.76% | | 6.74% | April 2016 | | (0.54)% | | (0.26)% | | (0.91)% | May 2016 | | 1.93% | | 1.87% | | 1.94% | June 2016 | | (1.34)% | | (0.07)% | | (0.39)% | July 2016 | | 4.87% | | 4.20% | | 4.72% | August 2016 | | (0.65)% | | (0.18)% | | (0.50)% | September 2016 | | 0.14% | | 0.19% | | 0.37% | October 2016 | | (2.45)% | | (2.09)% | | (2.35)% | November 2016 | | (0.25)% | | 2.94% | | 2.18% | December 2016 | | | | | | |
Impact of Proposed Changes to the Advisory Fees. While it is not possible to predict the effect of the proposed changes on the future investment advisory fees to be paid to the Adviser since it will depend on the future performance of Janus Portfolio relative to the performance of its Performance Fee Benchmark and the Performance Hurdle, and future changes to the size of Janus Portfolio, below is information to help you evaluate the impact of the changes. The following table shows: (i) the dollar amount of the actual investment advisory fee paid by Janus Portfolio for the twelve months ended June 30, 2015 and June 30, 2016, before and after application of the performance fee; (ii) the dollar amount of the pro forma investment advisory fee that would have been paid by Janus Portfolio before and after application of the performance fee, assuming the new Performance Hurdle, and the new Performance Fee Benchmark, the Russell 1000 Growth Index, were in effect for the entire performance measurement period; and (iii) the difference between the actual fees paid and thepro forma fees in dollars and as a percentage of the actual fees paid. Such percentage difference ispositive when the amount of thepro formaadvisory fees would have beenlargerthan actual advisory fees paid, andnegativewhen the amount of thepro formaadvisory fees would have beensmallerthan actual advisory fees paid. Janus Portfolio | | | | | | | | | | | | | | | | | Actual Advisory Fees Paid | | Pro Forma Advisory Fees Paid | | | 12-Months Ended | | Before Performance Fee | | Performance Fee | | After Performance Fee | | Before Performance Fee | | Performance Fee | | After Performance Fee | | Difference $/ % | June 30, 2015 June 30, 2016 | | $3,822,183
$3,393,045 | | ($410,360)
($39,060) | | $3,411,823
$3,353,985 | | $3,822,183
$3,393,045 | | ($383,446)
($475,284) | | $3,438,737
$2,917,761 | | $26,914 / 1%
($436,224)/(13%) |
As reflected in the table above, if the changes to the Performance Adjustment had been in effect the Fund would have paid slightly higher investment advisory fees for the twelve months ended June 30, 2015, and lower investment advisory fees for the twelve months ended June 30, 2016. 22
Implementation of the Changes to the Performance Adjustment. If Proposal 3 is approved, the change to the Performance Fee Benchmark will be implemented on a prospective basis beginning as soon as practicable following the date of shareholder approval and the consummation of the merger of JIF Janus Fund into JIF Research Fund. However, because the Performance Adjustment is based upon a rolling 36-month performance measurement period, the new Performance Fee Benchmark will not be fully implemented for 36 months after the implementation of the Amended Advisory Agreement. During this transition period, Janus Portfolio’s return will be compared to a blended index return that reflects the performance of the current Performance Fee Benchmark, the Core Growth Index, for the portion of the performance adjustment period prior to implementation of the Amended Advisory Agreement, and the performance of the new Performance Fee Benchmark, the Russell 1000 Growth Index, after implementation of the Amended Advisory Agreement, each in accordance with the terms of the Amended Advisory Agreement. For example, for the first month after the implementation of the changes to the Performance Adjustment, the Performance Adjustment would be calculated based on the performance of the Core Growth Index for the past 35 months (performance which occurred before the Amended Advisory Agreement was implemented) and the Russell 1000 Growth Index for the most recent month ended (performance that occurred after the Amended Advisory Agreement was implemented). At the conclusion of the transition period (36 months), the performance of the Core Growth Index would be eliminated from the Performance Adjustment calculation, and the calculation would include only the performance of the Russell 1000 Growth Index. The new Performance Hurdle will be used to calculate the Performance Adjustment beginning immediately in the first month following the implementation of the Amended Advisory Agreement and will be applied for the full 36-month performance measurement period. Calculation of the Performance Adjustment. If the average daily net assets of the Fund remain constant during a 36-month performance measurement period, current net assets will be the same as average net assets over the performance measurement period and the maximum Performance Adjustment will be equivalent to 0.15% of current net assets. When current net assets vary from average net assets over the 36-month performance measurement period, the Performance Adjustment, as a percentage of current assets, may vary significantly, including at a rate more or less than 0.15%, depending upon whether the net assets of the Fund had been increasing or decreasing (and the amount of such increase or decrease) during the performance measurement period. Note that if net assets for the Fund were increasing during the performance measurement period, the total performance fee paid, measured in dollars, would be more than if the Fund had not increased its net assets during the performance measurement period. The following hypothetical examples illustrate the application of the Performance Adjustment for the Fund. The examples assume that the average daily net assets of the Fund remain constant during a 36-month performance measurement period. The Performance Adjustment would be a smaller percentage of current assets if the net assets of the Fund were increasing during the performance measurement period, and a greater percentage of current assets if the net assets of the Fund were decreasing during the performance measurement period. All numbers in the examples are rounded to the nearest hundredth percent. The net assets of the Fund as of the twelve months ended June 30, 2015 and June 30, 2016 were $571,928,869 and $506,372,438, respectively. Under the Amended Advisory Agreement, the monthly maximum positive or negative Performance Adjustment of 1/12th of 0.15% of average net assets during the prior 36 months occurs if the Fund outperforms or underperforms its Performance Fee Benchmark by 5.00% over the same period. The Performance Adjustment is made in even increments for every 0.50% difference in the investment performance of the Fund’s Service Shares compared to the cumulative investment record of the Performance Fee Benchmark. Example 1: Fund Outperforms its Performance Fee Benchmark by 5.00% If the Fund has outperformed its Performance Fee Benchmark by 5.00% during the preceding 36 months, the Fund would calculate the investment advisory fee as follows: | | | | | Base Fee Rate | | Performance Adjustment Rate | | Total Investment Fee Rate For That Month | 1/12th of 0.64% | | 1/12th of 0.15% | | 1/12th of 0.79% |
23
Example 2: Fund Performance Tracks its Performance Fee Benchmark If the Fund’s performance has tracked the performance of its Performance Fee Benchmark during the preceding 36 months, the Fund would calculate the investment advisory fee as follows: | | | | | Base Fee Rate | | Performance Adjustment Rate | | Total Investment Fee Rate For That Month | 1/12th of 0.64% | | 0.00% | | 1/12th of 0.64% |
Example 3: Fund Underperforms its Performance Fee Benchmark by 5.00% If the Fund has underperformed its Performance Fee Benchmark by 5.00% during the preceding 36 months, the Fund would calculate the investment advisory fee as follows: | | | | | Base Fee Rate | | Performance Adjustment Rate | | Total Investment Fee Rate For That Month | 1/12th of 0.64% | | 1/12th of -0.15% | | 1/12th of 0.49% |
Comparison of Current and Pro Forma Expenses. The following tables describe the shareholder fees and annual fund operating expenses that you may pay if you buy and hold shares of the Fund under the current fee structure applying the current Performance Fee Benchmark (the Core Growth Index) and Performance Hurdle (+/- 4.50%) and thepro forma fee structure applying the proposed Performance Fee Benchmark (the Russell 1000 Growth Index) and Performance Hurdle (+/- 5.00%), without giving effect to any fee waivers. For purposes ofpro forma calculations, it is assumed that the proposed Performance Fee Benchmark and Performance Hurdle were in place during the entire 36-month performance measurement period. The fees and expenses shown were determined based upon net assets as of June 30, 2016. For the 36 months ended June 30, 2016, the Fund underperformed both the Core Growth Index and the Russell 1000 Growth Index, and the June 30, 2016 average daily net assets were lower than the trailing 36-month average daily net assets. However, the Fund’s performance was better relative to the Core Growth Index than the Russell 1000 Index for the 36 months ended June 30, 2016, resulting in the actual management fee rate paid by the Fund being higher than thepro formamanagement fee rate that would have been paid by Janus Portfolio applying the new Performance Fee Benchmark and new Performance Hurdle, as shown in the Annual Fund Operating Expenses table below. Shareholder fees are those paid directly from your investment and may include sales loads. Annual fund operating expenses are paid out of the Fund’s assets and include fees for portfolio management and administrative services, including recordkeeping, subaccounting, and other shareholder services. You do not pay these fees directly but, as the examples show, these costs are borne indirectly by all shareholders.Owners of variable insurance contracts that invest in the shares of the Fund should refer to the variable insurance contract prospectus for a description of fees and expenses, as the following table and examples do not reflect deductions at the separate account level or contract level for any charges that may be incurred under a contract. Inclusion of these charges would increase the fees and expenses described below. | | | | | ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage of the value of your investment) | Service Shares | | Current based on Core Growth Index and 4.50% Hurdle | | Pro Forma based on Russell 1000 Growth Index and 5.00% Hurdle | Management Fees (may adjust up or down)(1) | | 0.63% | | 0.55% | Distribution/Service (Rule 12b-1) Fees(2) | | 0.25% | | 0.25% | Other Expenses(3) | | 0.11% | | 0.11% | Total Annual Fund Operating Expenses | | 0.99% | | 0.91% |
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| | | | | ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage of the value of your investment) | Institutional Shares | | Current based on Core Growth Index and 4.50% Hurdle | | Pro Forma based on Russell 1000 Growth Index and 5.00% Hurdle | Management Fees (may adjust up or down) (1) | | 0.63% | | 0.55% | Other Expenses(3) | | 0.11% | | 0.11% | Total Annual Fund Operating Expenses | | 0.74% | | 0.66% |
EXAMPLE: The following Example is based on expenses as shown in the table above. The Example is intended to help you compare the cost of investing in the Fund under both the Current Advisory Agreement and the Amended Advisory Agreement, with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 for the time periods indicated, reinvest all dividends and distributions, and then redeem all of your shares at the end of each period. The Example also assumes that your investment has a 5% return each year and that the Fund’s operating expenses remain the same as shown above. Thepro formacalculations assume the Performance Adjustment had been in effect for a 36-month period as of June 30, 2016. Although your actual costs may be higher or lower, based on these assumptions your costs would be: | | | | | | | | | | | | | | | | | | | 1 Year | | | 3 Years | | | 5 Years | | | 10 Years | | Service Shares | | | | | | | | | | | | | | | | | Current based on Core Growth Index and 4.50% Hurdle | | | $101 | | | | $315 | | | | $547 | | | | $1,213 | | Pro Formabased on Russell 1000 Growth Index and 5.00% Hurdle | | | $93 | | | | $290 | | | | $504 | | | | $1,120 | | Institutional Shares | | | | | | | | | | | | | | | | | Current based on Core Growth Index and 4.50% Hurdle | | | $76 | | | | $237 | | | | $411 | | | | $918 | | Pro Formabased on Russell 1000 Growth Index and 5.00% Hurdle | | | $67 | | | | $211 | | | | $368 | | | | $822 | |
(1) | The Management Fee is the investment advisory fee rate paid by the Fund to Janus Capital. Any Performance Adjustment included in calculating thePro Forma Management Fee as shown for each class of shares of the Fund is based on the investment performance of the Fund’s Service shares versus the Core Growth Index (for “Current” expenses) and Russell 1000 Index (for “Pro Forma” expenses), over the 36-month period ended June 30, 2016. Because the New Performance Benchmark will be implemented over a transitional period, actual advisory fees paid if the Amended Advisory Agreement is approved may have been higher. Once the Performance Adjustment is determined, it is applied across the Institutional Shares of the Fund. The annual investment advisory fee rate, prior to any Performance Adjustment, is 0.64% for each Fund. |
(2) | Because Rule 12b-1 fees are charged as an ongoing fee, over time the fee will increase the cost of your investment and may cost you more than paying other types of sales charges. |
(3) | “Other Expenses” have been restated to include an administrative services fee at the annual rate of 0.05% of the average daily net assets effective May 1, 2016, to compensate insurance companies or other financial intermediaries for services provided to contract owners and plan participants and may include reimbursements to Janus Services LLC of its out-of-pocket costs for serving as transfer agent and providing servicing to shareholders, including servicing provided by third parties. “Other Expenses” for all classes of the Funds may include reimbursement to the Adviser of its out-of-pocket costs for services as administrator. |
Board Considerations The Adviser met with the Trustees on December 7-8, 2016, to discuss the Amended Advisory Agreement and other matters related to the Realignment. At the meeting, the Trustees also discussed the Amended Advisory Agreement and other matters related to the Realignment with their independent counsel in executive session. During the course of this meeting, the Trustees requested and considered such information as they deemed relevant to their deliberations. In addition, at prior meetings and during the course of this meeting the Board also considered the proposal to merge the JIF Janus Fund into the JIF Research Fund and undertook a comprehensive process to 25
evaluate the impact of the Transaction on the nature, quality and extent of services expected to be provided by the Adviser to the Fund, including after the completion of the Transaction. For a fuller discussion of the Board’s consideration of the approval of a new investment advisory agreement for the Fund in connection with the Transaction, see “Board Considerations” after Proposal 2 in this Proxy Statement beginning at page [13]. At a meeting of the Board of Trustees held on December 8, 2016, the Trustees approved the Amended Advisory Agreement and other matters related to the Realignment. In determining whether to approve the Amended Advisory Agreement, and whether to recommend approval to Fund shareholders, the Board received information and made inquiries into all matters as it deemed appropriate. The Board reviewed and analyzed various factors it deemed relevant, including the following factors, among others, none of which by itself was considered dispositive: the terms of the Amended Advisory Agreement are substantially the same as the Current Advisory Agreement, except for the change to the Performance Hurdle and Performance Fee Benchmark; the estimated impact of the change to the Performance Hurdle and Performance Fee Benchmark on the amount of advisory fees to be paid by the Fund, including consideration of comparative pro forma data showing the advisory fees payable if the Amended Advisory Agreement had been in place in prior years; the Fund’s investment team will be able to more efficiently manage the Fund’s portfolio, assuming the merger of the JIF Janus Fund into the JIF Research Fund is implemented, which may also provide benefits from opportunities to aggregate trading across funds that have similar investment strategies; the Adviser’s belief that the Fund shareholders may benefit from the Realignment, as a result of the research-driven investment process to be implemented, which includes lower historical transaction costs and potential performance gains from securities lending as compared to the Fund’s current investment approach; the Realignment was being proposed as part of the Adviser’s efforts to streamline its product line; the Adviser’s belief that the Fund would benefit from the Adviser’s operational efficiencies resulting from the merger of the JIF Janus Fund into the JIF Research Fund and the Realignment, including a potentially more efficient and effective investment management approach providing the potential for a growing fund and improved performance after the Realignment; the costs of the seeking approval of the Amended Advisory Agreement will be borne by the Adviser; the costs incurred to reposition the Fund’s portfolio in connection with the Realignment; the potential tax consequences of any repositioning of the Fund’s portfolio as a result of the Merger; and any potential benefits of the Adviser and its affiliates as a result of the Realignment. Shareholder Approval To become effective with respect to Janus Portfolio, the Amended Advisory Agreement must be approved by a 1940 Act Majority of the Fund, with all classes of shares voting together as a single class. The shares of Janus Portfolio will be counted using dollar-based voting. This means that each share of Janus Portfolio will represent the number of votes equal to that share’s net asset value on the record date. For purposes of determining the approval of the Amended Advisory Agreement, abstentions and broker non-votes will have the same effect as shares voted against the proposal. The Realignment does not require shareholder approval. If the proposed merger of JIF Janus Fund into JIF Janus Research Fund is completed, but the Amended Advisory Agreement is not approved, the Board will consider whether to nonetheless implement the Realignment and will take such actions as it deems to be in the best interest of Janus Portfolio. 26
The Board unanimously recommends that shareholders of the Fund vote FOR approval of the Amended Advisory Agreement. 27
PROPOSAL 4 TRUSTEE ELECTION Introduction At the Meeting, shareholders of all series of the Trust will be asked to elect an additional individual to the Board of Trustees. Currently, the Board has eight members, each of whom is an Independent Trustee. In connection with the Transaction, the Board has sought to increase the size of the Board to nine members and has nominated Diane L. Wallace (the “Trustee Nominee”) to stand for election as a Trustee. Ms. Wallace was unanimously approved by the Board to stand for election, upon a recommendation from the Trust’s Nominating and Governance Committee, a committee consisting entirely of Independent Trustees, and the nomination was approved by all of the current Independent Trustees. Eight Ms. Wallace currently serves as a trustee of the ten nominees currently
serve as Trustees of the Trust. Each nominee has consentedcertain mutual funds advised by HGINA and would qualify to serve as aan Independent Trustee. Among other things, the Board considered Ms. Wallace’s background and experience in the financial services industry, including her experience with the Henderson funds, and determined that the addition of Ms. Wallace to the Board would provide valuable continuity and enhance the Board’s oversight of the Trust following the completion of the Transaction. The election by shareholders of the Trustee Nominee will provide the Board with flexibility going forward to replace Trustees as needed without the time and to being named in this Proxy Statement. expense of unnecessary proxy solicitation. The persons named as proxies on the enclosed proxy card(s) will vote for the election of the nomineesnominee named below unless authority to vote for any or all of the nominees is withheld. If elected, eachthe Trustee Nominee will serve as a Trustee until the next meeting of the shareholders, if any, called for the purpose of electing all Trustees or until the election and qualification of a successor. If a Trustee sooner dies, resigns, retires (required(currently expected at the end of the calendar year in which the Trustee turns age 72)75), or is removed as provided in the organizational documents of the Trust, the Board may, in its discretion and subject to the 1940 Act, select another person to fill the vacant position. If any or all of the nomineesTrustee Nominee should become unavailable for election at the Meeting due to events not now known or anticipated, the personpersons named as proxies will vote for such other nominee or nominees as the current Independent Trustees may recommend. The Funds areTrust is not required, and do not intend, to hold annual shareholder meetings for the purpose of electing Trustees. However, under the terms of a
settlement reached between Janus Capital and the Securities and Exchange
Commission (the "SEC," or the "Staff") in August 2004, commencing in 2005 and
not less than every fifth calendar year thereafter, the Funds are obligated to
hold a meeting of shareholders to elect Trustees. Shareholders also have the right to call a meeting to remove a Trustee or to take other action described in the Trust'sTrust’s organizational documents. Also, if at any time less than a majority of the Trustees holding office hashave been elected by the Trust'sTrust’s shareholders, the Trustees then in office will promptly call a shareholder meeting for the purpose of electing one or more Trustees. The nominees for TrusteesTrustee Nominee and their backgroundsher background are shown on the following pages. This information includes each nominee'sTrustee’s and Trustee Nominee’s name, age, principal occupation(s) and other information about the nominee'seach Trustee and Trustee Nominee’s professional background, including other directorships the nomineeTrustee or the Trustee Nominee holds or held, during the past five years. The address of each nomineeTrustee and the Trustee Nominee is 151 Detroit Street, Denver, Colorado 80206. All nominees listed below, other than John H. CammackEach Trustee serves, and John P.
McGonigle, are currently Trustees of the Trust and have served in that capacity
since originallyTrustee Nominee, if so elected or appointed. In addition, each
7
nominee, other than John H. Cammack and John P. McGonigle, is currentlywill serve, as a trustee of Janus Investment Fund ("JIF"(“JIF”), another registered investment company advised by Janus Capital (JIF and the Trust, are collectively referred to herein as the "Janus funds"“Janus Funds”). Collectively, the Janus fundsFunds consist of 52 series as of December 31, 2009.
Each Trustee or nominee is not an "interested" person of the Trust, as that
term is defined in the 1940 Act.
2016. 28
NUMBER OF FUNDS IN PRINCIPAL OCCUPATION(S) AND
NAME, AGE AND LENGTH OF TIME FUND COMPLEX OTHER DIRECTORSHIPS
POSITIONS(S) WITH THE SERVED FOR THE OVERSEEN OR TO BE HELD BY | | | | | | | | | Name, Year of Birth, and Position(s) with the Trust | | Length of Time Served for the Trust | | Number of Funds in Fund Complex Overseen or to be Overseen by Nominee | | | Principal Occupation(s) and Other Directorships Held by Nominee During Past Five Years | TRUSTEE NOMINEE
TRUST TRUST OVERSEEN BY NOMINEE DURING PAST FIVE YEARS
--------------------- -------------- ------------------- ---------------------------
John H. Cammack : | | | | | | | Diane L. Wallace Year of Birth: 1958 | | N/A 52 Managing partner | | | 58 | | | Retired. Independent Trustee, Henderson Global Funds (13 portfolios) (since 2015); Independent Trustee, State Farm Associates’ Funds Trust, State Farm Mutual Fund Trust, and State Farm Variable product Trust (28 portfolios) (since 2013). | INDEPENDENT TRUSTEES: | | | | Alan A. Brown Year of Cammack
DOB: 1952 Associates LLC, a
Nominee consulting firmBirth: 1962 Trustee | | 1/13-Present | | | 58 | | | Executive Vice President, Institutional Markets, of Dividend Capital Group (private equity real estate investment management firm) (since 2009)2012). Formerly, HeadExecutive Vice President andCo-Head, Global Private Client Group (2007-2010), Executive Vice President, Mutual Funds (2005-2007), and Chief Marketing Officer (2001-2005) of Third Party Distribution
divisionNuveen Investments, Inc. (asset management). Director of T. Rowe Price
(1991-2009).
Jerome S. Contro 12/05 - Present 52 General partnerMotiveQuest LLC (strategic social market research company) (since 2003), and Director of DOB: 1956 Crosslink Capital, a
Trustee private investment firmWTTW (PBS affiliate) (since 2008). Formerly,
partner of Tango Group, a
private investment firm
(1999-2008)2003). Formerly, Director of Envysion, Inc.
(internet technology),
Lijit Networks, Inc.
(internet technology), and
LogRhythm Inc. (software
solutions)Nuveen Global Investors LLC (2007-2011); Trustee and
ChairmanDirector of RS Investment
Trust; Director, IZZE
Beverages;Communities in Schools (2004-2010); and Director Ancestory.com,of Mutual Fund Education Alliance (until 2010). | William D. Cvengros Year of Birth: 1948 Trustee | | 1/11-Present | | | 58 | | | Managing Member and Chief Executive Officer of SJC Capital, LLC (a personal investment company and consulting firm) (since 2002). Formerly, Venture Partner for The Edgewater Funds (a middle market private equity firm) (2002-2004); Chief Executive Officer and President of PIMCO Advisors Holdings L.P. (a publicly traded investment management firm) (1994-2000); and Chief Investment Officer of Pacific Life Insurance Company (a mutual life insurance and annuity company) (1987-1994). Advisory Board Member, Innovate Partners Emerging Growth and Equity Fund I (early stage venture capital fund) (since 2014) and Managing Trustee of National Retirement Partners Liquidating Trust (since 2013). Formerly, Chairman, National Retirement Partners, Inc. (genealogical research
website)(formerly a network of advisors to 401(k) plans) (2005-2013); Director of Prospect Acquisition Corp. (a special purpose acquisition corporation) (2007-2009); Director of RemedyTemp, Inc. (temporary help services company) (1996-2006); and Trustee of PIMCO Funds Multi-Manager Series (1990-2000) and Pacific Life Variable Life & Annuity Trusts (1987-1994). | Raudline Etienne Year of Birth: 1965 Trustee | | 6/16-Present | | | 58 | | | Senior Advisor, Albright Stonebridge Group LLC (global strategy firm) (since 2016). Formerly, Senior Vice President (2011-2015), Albright Stonebridge Group LLC; and Deputy Comptroller and Chief Investment Officer, New York State Common Retirement Fund (public pension fund) (2008-2011). Director of Brightwood Capital Advisors, LLC (since 2014). | William F. McCalpin Year of Birth: 1957 Chairman Trustee | | 1/08 - Present 5208-Present 6/02-Present | | | 58 | | | Managing Partner, Impact Investments, Athena Capital Advisors LLC (independent registered investment advisor) (since 2016) and Managing Director, Holos DOB: 1957 6/02 - Present Consulting LLC (provides Chairman consulting services to
Trustee foundations and other nonprofit organizations). Formerly, Chief Executive Officer, Imprint Capital (impact investment firm) (2013-2015) and Executive Vice President and Chief Operating Officer of The Rockefeller Brothers Fund (a private family foundation) (1998-2006). Chairman of the Board and Director of The Investment Fund for Foundations Investment Program (TIP) (consisting of 42 funds);, and Director of the F.B. Heron Foundation (a private grantmakinggrant making foundation).
John W. McCarter, Jr. |
29
| | | | | | | Name, Year of Birth, and Position(s) with the Trust | | Length of Time Served for the Trust | | Number of Funds in Fund Complex Overseen or to be Overseen by Nominee | | Principal Occupation(s) and Other Directorships Held by Nominee During Past Five Years | Gary A. Poliner Year of Birth: 1953 Trustee | | 6/02 - Present 5216-Present | | 58 | | Retired. Formerly, President (2010-2013) and Executive Vice President and Chief DOB: 1938 ExecutiveRisk Officer (2009-2012) of TheNorthwestern Mutual Life Insurance Company. Director of MGIC Investment Corporation (private mortgage insurance) (since 2013) and West Bend Mutual Insurance Company (property/casualty insurance) (since 2013). Formerly, Trustee Field Museum of Natural
History (Chicago, IL)
(since 1996).Northwestern Mutual Life Insurance Company (2010-2013); Chairman of
the Board and Director of DivergenceNorthwestern Mutual Series Fund, Inc. (biotechnology firm);
Director of W.W. Grainger,
Inc. (industrial
distributor); Trustee of
WTTW (Chicago public
television station) and the
University of Chicago;
Regent, Smithsonian
Institution; and Member of
the Board of Governors for
Argonne National Laboratory
John P. McGonigle N/A 52 Formerly, Vice President,
DOB: 1955 Senior Vice President and
Nominee Executive Vice President of
Charles Schwab & Co., Inc.
(1989-2006). Trustee of
PayPal Funds (since 2008).
Formerly, Director of
Charles Schwab
International Holdings (a
brokerage service division
for joint ventures outside
the U.S.) (1999-2006)
|
8
NUMBER OF FUNDS IN PRINCIPAL OCCUPATION(S) AND
NAME, AGE AND LENGTH OF TIME FUND COMPLEX OTHER DIRECTORSHIPS
POSITIONS(S) WITH THE SERVED FOR THE OVERSEEN OR TO BE HELD BY NOMINEE
TRUST TRUST OVERSEEN BY NOMINEE DURING PAST FIVE YEARS
--------------------- -------------- ------------------- ---------------------------
Dennis B. Mullen 2/71 - Present 52 * Chief Executive Officer of
DOB: 1943 Red Robin Gourmet Burgers,
Trustee Inc. (since 2005).
Formerly, private investor.
Chairman of the Board
(since 2005) and Director
of Red Robin Gourmet
Burgers, Inc. (RRGB)(2010-2012); and Director of Janus Capital
Funds Plc (Dublin-based,
non-U.S. funds)Frank Russell Company (global asset management firm)(2008-2013).James T. Rothe Year of Birth: 1943 Trustee | | 1/97 - Present 52 97-Present | | 58 | | Co-founder and Managing
DOB: 1943 Director of Roaring Fork Trustee Capital SBIC, LPL.P. (SBA SBIC fund focusing on private investment in public equity firms);, and Professor Emeritus of Business of the University of Colorado, Colorado Springs, CO (since 2004). Formerly, Professor of Business of the University of Colorado (2002-2004);, and Distinguished Visiting Professor of Business (2001-2002) of Thunderbird (American Graduate School of International Management), Glendale, AZ. Formerly, Director of Red Robin Gourmet Burgers, Inc. (RRGB) (2004-2014). | William D. Stewart Year of Birth: 1944 Trustee | | 6/84 - Present 5284-Present | | 58 | | Retired. Formerly, Corporate Vice President
DOB: 1944 and General Manager of MKS Trustee Instruments -– HPS Products, Boulder, CO (a manufacturer of vacuum fittings and valves) and PMFC Division, Andover, MA (manufacturing pressure measurement and flow products)(1976-2012).
Martin H. Waldinger 8/69 - Present 52 Private investor and
DOB: 1938 Consultant to California
Trustee Planned Unit Developments
(since 1994). Formerly, CEO
and President of Marwal,
Inc. (homeowner association
management company).
| Linda S. Wolf Year of Birth: 1947 Trustee | | 11/05 - Present 52 05-Present | | 58 | | Retired. Formerly, Chairman
DOB: 1947 and Chief Executive Officer
Trustee of Leo Burnett (Worldwide) (advertising agency) (2001-
2005)(2001-2005). Director of Wal-
Mart, The Field Museum of
Natural History (Chicago,
IL), Children's Memorial
Hospital (Chicago, IL)Chicago Community Trust (Regional Community Foundation), Chicago Council on Global Affairs, and InnerWorkings (U.S. provider of print procurement solutions to corporate clients), Lurie Children’s Hospital (Chicago, IL), Rehabilitation Institute of Chicago, Walmart, and Wrapports, LLC (digital communications company). Formerly, Director of Chicago Convention & Tourism Bureau (until 2014) and The Field Museum of Natural History (Chicago, IL) (until 2014). |
--------
* Mr. Mullen also serves as directorGeneral Information Regarding the Board of Janus Capital Funds Plc ("JCF"), an
offshore product, consisting of 17 funds. Including JCF and the 52 funds
comprising the Janus funds, Mr. Mullen oversees 69 funds.
GENERAL INFORMATION REGARDING THE BOARD OF TRUSTEES
Trustees The Trust is governed by the Board of Trustees, which is responsible for and oversees the management and operations of the Trust and each of the FundsFund on behalf of Fund shareholders. Each member of the Board is an Independent Trustee, including the Board'sBoard’s Chairman. The Board'sBoard’s responsibilities include, but are not limited to, oversight of the Funds'Funds’ officers and service providers, including Janus Capital, which is responsible for the Trust'sTrust’s day-to-day operations. The Trustees approve all of the agreements entered into with the Funds'Funds’ service providers, including the investment management
9
advisory agreements with Janus Capital and the Funds' sub-advisors.Funds’ sub-advisers. The Trustees are also responsible for determining or changing the Funds'Funds’ investment objectives, policies, and available investment techniques, as well as for overseeing the Funds'Trust’s Chief Compliance Officer. In carrying out these responsibilities, the Trustees are assisted by the Trust'sTrust’s independent auditor (who reports directly to the Trust'sTrust’s Audit Committee), independent counsel, an independent fee consultant, and other expertsspecialists as appropriate, all of whom are selected by the Trustees. The Trustees also meet regularly with and without representatives of Janus Capital or its affiliates present. The Trustees discharge their responsibilities collectively as a Board, as well as through Board committees, each of which operates pursuant to a Board-
approvedBoard-approved charter that delineates the specific responsibilities of that committee. For example, the Board as a whole is responsible for oversight of the annual process by which the Board considers and approves each Fund'sFund’s investment advisory agreement with Janus Capital, but specific matters related to oversight of the Fund'sFunds’ independent auditors have been delegated by the Board to its Audit Committee, subject to approval of the Audit Committee'sCommittee’s recommendations by the Board. The members and responsibilities of each Board committee are summarized below. In addition to serving on certain committees, the Chairman of the Board ("(“Board Chairman"Chairman”) is responsible for presiding at all meetings of the Board, and has other duties as may be assigned by the 30
Trustees from time to time. The Board Chairman also serves as the Board'sBoard’s liaison to Janus Capital with respect to all matters related to the Funds that are not otherwise delegated to the chair of a Board committee. The Board has determined that this leadership structure is appropriate based on (1) the number of Funds overseen and the various investment objectives of those Funds,Funds; (2) the manner in which the Funds'Funds’ shares are marketed and distributeddistributed; and (3) the responsibilities entrusted to Janus Capital and its affiliates to oversee the Trust'sTrust’s day-to-day operations, including the management of each Fund'sFund’s portfolio and the distribution of Fund shares. On an annual basis, the Board conducts a self-evaluation that considers, among other matters, whether the Board and its committees are functioning effectively and whether, given the size and composition of the Board and each ifof its committees, the Trustees are able to oversee effectively the number of Janus Funds in the complex. There were six regular meetings and fourteen special meetings of the Trustees held during the Trust'sTrust’s fiscal year ended December 31, 2009.2016. Each Trustee attended most if not all of thethese meetings with few exceptions during that fiscal year. SinceBecause the Trust is not required to convene annual shareholder meetings, there is no policy requiring Trustee attendance at such meetings.
The Board of Trustees proposed for election at the Meeting will be
comprised of ten trustees. The SEC has adopted rules that require at least 75%
of the board members of a fund to be "independent" in order for the fund to take
advantage of certain exemptive rules under the 1940 Act. If the slate of
nominees is approved by shareholders, 100% Committees of the Board of Trustees will
continue to be "independent."
10
COMMITTEES OF THE BOARD OF TRUSTEES
The Board of Trustees has six standing committees that perform specialized functions: an Audit Committee, a Brokerage Committee, an Investment Oversight Committee, a Legal and Regulatory Committee, a Nominating and Governance Committee, and a Pricing Committee. Each committee is comprised entirely of Independent Trustees and has a written charter that delineates its duties and powers. Each committee reviews and evaluates matters as specified in its charter and makes recommendations to the Trustees as it deems appropriate. Each committee may utilize the resources of counsel to the Independent Trustees and the Trust, independent auditors and other experts. The committees normally meet in conjunction with regular meetings of the Trustees but may convene at other times (in person or by telephone) as deemed appropriate or necessary. The membership and chairperson of each committee is appointed by the Trustees upon recommendation of the Trust'sTrust’s Nominating and Governance Committee. Audit Committee.Committee. The Audit Committee reviews the Trust'sTrust’s financial reporting process, the system of internal controls over financial reporting, disclosure controls and procedures, Form N-CSR filings, and the audit process. The Committee'sCommittee’s review of the audit process includes, among other things, the recommendationappointment, compensation and oversight of the appointment and compensation of the Trust'sTrust’s independent auditor, which performs the audits of the Funds'Funds’ financial statements, oversight
of the independent auditor, and pre-approval of all audit and non-audit services. The Committee receives annual representations from the Trust'sTrust’s independent auditor as to its independence. Currently, the members of the Audit Committee are: Jerome S. Contro (Chairman)William D. Cvengros (Chair), John W. McCarter, Jr.Gary A. Poliner and Dennis B.
Mullen.William D. Stewart. The Committee held four meetings during the fiscal year ended December 31, 2009.
2016. Brokerage Committee.Committee. The Brokerage Committee reviews and makes recommendations regarding matters related to the Trust'sTrust’s use of brokerage commissions and placement of Fund portfolio transactions, including policies
regarding the allocation of brokerage commissions, directed brokerage, "step-
out" arrangements and client commission arrangements.transactions. Currently, the members of the Brokerage Committee are: Alan A. Brown (Chair), James T. Rothe, (Chairman), Jerome S. Contro and Martin H. Waldinger.William D. Stewart. The Committee held four meetings during the fiscal year ended December 31, 2009.
2016. Investment Oversight Committee.Committee. The Investment Oversight Committee oversees the investment activities of the Funds. The Committee meets regularly with investment personnel at Janus Capital and any sub-advisersubadviser to a Fund to review the investment performance and strategies of the Funds in light of their stated investment objectives and policies. Currently, the members of the Investment Oversight Committee are: Dennis B. Mullen (Chairman), Jerome S.
Contro, William F. McCalpin John W. McCarter, Jr.(Chair), Alan A. Brown, William D. Cvengros, Raudline Etienne, Gary A. Poliner, James T. Rothe, William D. Stewart, Martin H. Waldinger and Linda S. Wolf. The Committee held five meetings during the fiscal year ended December 31, 2009.
2016. Legal and Regulatory Committee.Committee. The Legal and Regulatory Committee oversees compliance with various procedures adopted by the Trust, reviews certain 11
regulatory filings made with the SEC, and oversees, among other matters, the implementation and administration of the Trust'sTrust’s Proxy Voting Guidelines. Currently, the members of the Legal and Regulatory Committee are: Linda S. Wolf (Chairman)(Chair), Alan A. Brown, Gary A Poliner and William F. McCalpin and William D. Stewart.McCalpin. The Committee held five meetings during the fiscal year ended December 31, 2009.
2016. 31
Nominating and Governance Committee.Committee. The Nominating and Governance Committee identifies and recommends individuals for Trustee membership, consults with Fund managementofficers and the Board Chairman in planning Trustee meetings, and oversees the administration of, and ensures compliance with, the Governance Procedures and Guidelines adopted by the Trustees, which includes review of, and proposed changes to, Trustee compensation. In addition, the Nominating and Governance Committee leads the Trustees’ annual self-assessment process. Currently, the members of the Nominating and Governance Committee are: John W. McCarter, Jr. (Chairman)James T. Rothe (Chair), William F. McCalpin, and Dennis B Mullen.Linda S. Wolf. The Committee held eightmeetings during the fiscal year ended December 31, 2009.
2016. Pricing Committee.Committee. The Pricing Committee determines the fair value of restricted and other securities for which market quotations are not readily available, or that are deemed not to be reliable, pursuant to procedures adopted by the Trustees. The Committee also reviews other matters related to pricing the Funds'Janus Funds’ securities. Currently, the members of the Pricing Committee are: William D. Stewart (Chairman)(Chair), Raudline Etienne, James T. Rothe, and Linda S. Wolf. The Committee held sixteen meetings during the fiscal year ended December 31, 2009.
PROCESS FOR IDENTIFYING AND EVALUATING TRUSTEE NOMINEES AND NOMINEE
QUALIFICATIONS
2016. Process for Identifying and Evaluating Trustee Nominees and Nominee Qualifications The Nominating and Governance Committee of the Board is responsible for identifying and nominating candidates for appointment as Trustees. As stated in the Committee'sCommittee’s charter, (1) the principal criterion for selection of candidates for the Board is the candidate'scandidate’s ability to contribute to the overall functioning of the Board and to carry out the responsibilities of a Trustee.Trustee, and (2) the Trustees should, collectively, represent a broad cross section of backgrounds, functional disciplines, and experience. In considering a potential candidate'scandidate’s qualifications to serve as a Trustee, the Committee may also take into account a variety of other diverse criteria, including, but not limited to (i) knowledge of the investment company industry,industry; (ii) relevant experience,experience; (iii) educational background,background; (iv) reputation for high ethical standards and personal and professional integrity,integrity; (v) financial, technical or other expertise,expertise; (vi) time commitment to the performance of duties of a Trustee,Trustee; (vii) stature commensurate with the responsibility of representing Fund shareholders,shareholders; and (viii) if a candidate is nominated for an Independent Trustee position, that the person meets the independence criteria established by the 1940 Act and the Governance Procedures and Guidelines adopted by the Trustees. Consistent with the Trust'sTrust’s organizational documents and procedures adopted by the Committee, the Committee will consider Trustee nominations made by shareholders. Shareholders of a Fund may submit names of potential candidates for consideration by the Committee by submitting their recommendations to the Trust'sTrust’s Secretary, at the address of the principal executive office of the Trust, in accordance with procedures
12
adopted by the Committee. A copy of such procedures is included as Appendix 1 to the Nominating and Governance Committee Charter attached to this Proxy Statement asAppendix A.
J. The Committee may use any process it deems appropriate for identifying and evaluating candidates for service as a Trustee, which may include, without limitation, personal interviews, background checks, written submissions by the candidates, third party references and the use of consultants, including professional recruiting firms.firms, which the Committee utilized to assist its efforts to identify and evaluate potential nominees during its most recent search. The Committee will evaluate nominees for a particular vacancy using the same process regardless of whether the nominee is submitted by a Fund shareholder or identified by some other means. On an annual basis, the Board conducts a self-evaluation that considers, among other matters, the contributions of individual Trustees, whether the Board has an appropriate size and the right mix of characteristics, experiences and skills, and whether the age distribution and diversity among the Trustees is appropriate. After completion of its process to identify and evaluate Trustee nominees, and after giving due consideration to all factors it deemed appropriate, the Committee approved for nomination, and recommended that the Trustees approve for nomination, the ten nomineesTrustee Nominee identified below.herein. The Committee believes that if elected, each of the nomineesTrustee Nominee qualifies to serve as an Independent Trustee. Each
nominee'sThe Trustee Nominee’s background is detailed above. The Committee and the Trustees considered the totality of the information available to them, and took into account the specific experience, qualifications, attributes or skills discussed below to conclude that each nomineeTrustee and Trustee Nominee should serve as a Trustee, in light of the Trust'sTrust’s business and structure. In reaching these conclusions, the Committee and the Trustees, in the exercise of their reasonable business judgment, evaluated each nomineeTrustee and Trustee Nominee based on the criteria described above, and reviewed the specific experience, qualifications, attributes or skills that each nomineeTrustee and Trustee Nominee presented, none of which by itself was considered dispositive.
John H. Cammack: service 32
Trustee Nominee Diane L. Wallace: Service as HeadIndependent Trustee of Third Party DistributionHenderson Global Funds and memberother leading investment management firms, and as Chief Operating Officer, Senior Vice President of the Operating Steering Committee forOperations, Treasurer and Chief Financial Officer of a large mutualleading investment management firm. Independent Trustees Alan A. Brown: Service as Executive Vice President and as Chief Marketing Officer of a leading investment management firm, a corporate and fund complex, service on two
not-for-profit boardsdirector, and chairman of the Mutual Fund Education Alliance.
Jerome S. Contro: General Partner inas an executive with a private equity real estate investment firms, service on
multiple corporate boards,management firm, and a Fund Independent Trustee since 2005.
2013. William D. Cvengros: Service as Chief Executive Officer and President of a leading publicly traded investment management firm, Chief Investment Officer of a major life insurance company, a corporate and fund director, and in various capacities with private investment firms, and a Fund Independent Trustee since 2011. Raudline Etienne: Service as Deputy Controller and Chief Investment Officer of a large public pension fund, Senior Vice President and Senior Adviser to a global strategy firm, and a Fund Independent Trustee since 2016. William F. McCalpin: serviceMcCalpin: Service as Chief Operating Officer of a large private family foundation, Chairman and Director of an unaffiliated fund complex, and a Fund Independent Trustee since 2002 and Independent Chairman of the Board of Trustees since 2008.
John P. McGonigle: service in multiple capacities with a leading financial
services firm, including Gary A. Poliner: Service as Head of Mutual FundsPresident, and Asset Management,Vice President and as an
independent trusteeChief Risk Officer, of a money market fund.
John W. McCarter, Jr.: Presidentlarge life insurance company, a director of private companies, service as director and CEOChairman and Director of large non-profit organization,
service on multiple corporate and non-profit boards,unaffiliated fund complexes, and a Fund Independent Trustee since 2002.
13
Dennis B. Mullen: Chairman of the Board and CEO of NASDAQ-listed company,
director of off-shore fund complex, and a Fund Independent Trustee since 1971
and Independent Chairman of the Board of Trustees from 2004 to 2007.
2016. James T. Rothe:Rothe: Co-founder and Managing Director of a private investment firm, former business school professor, service as a corporate director, and a Fund Independent Trustee since 1997. William D. Stewart: Corporate vice-presidentStewart: Service as a corporate vice president of a NASDAQ-listed industrial manufacturer and a Fund Independent Trustee since 1984.
Martin H. Waldinger: service as CEO of a homeowner association management
company, and a Fund Independent Trustee since 1969.
Linda S. Wolf: serviceWolf: Service as Chairman and CEOChief Executive Officer of a global advertising firm, service on multiple corporate and non-profitnonprofit boards, and a Fund Independent Trustee since 2005.
BOARD OVERSIGHT OF RISK MANAGEMENT
Board Oversight of Risk Management Janus Capital, as part of its responsibilities for the day-to-day operations of the Funds, is responsible for day-to-day risk management forof the Funds. The Board, as part of its overall oversight responsibilities for the Fund'sFunds’ operations, oversees Janus Capital'sCapital’s risk management efforts with respect to the Funds. The Board, inJanus funds. In the exercise of its reasonable business judgment, the Board also separately considers potential risks that may impact the Funds. The Board discharges its oversight duties and considers potential risks in a number of different ways, including, but not limited to, receiving reports on a regular basis, either directly or through an appropriate committee, from Janus Capital and its officers. Reports received include those from, among others, Janus Capital'sCapital’s (1) senior managers responsible for oversight of global risk;risk, including, for example, those responsible for oversight of cyber risks; (2) senior managers responsible for oversight of portfolio construction and trading risk; (3) Chief Compliance Officer,Officer; and (4) Director of Internal Audit. At the time these reports are presented, the Board or the committee receiving the report will, as it deems necessary, invite the presenter to participate in an executive session to discuss matters outside the presence of any other officers or representatives of Janus Capital or its affiliates. The Board also receives reports from other entities and individuals unaffiliated with Janus Capital, including reports from the Funds'Funds’ other service providers and from independent consultants hired by the Board. Various Board committees also will consider particular risk items as the committee addresses items and issues specific to the jurisdiction of that committee. For example, the Pricing Committee will consider valuation risk as part of its regular oversight responsibilities, and similarly, the Brokerage Committee will consider counter-partycounterparty risk associated with the Funds'Funds’ portfolio transactions. The Board also may be apprised of particular risk management matters in connection with its general oversight and approval of various Fund matters brought before the Board.
14
33
The Board has appointed a Chief Compliance Officer for the Funds ("(“Fund CCO"CCO”) who (1) reports directly to the Board and (2) provides a comprehensive written report annually and presents quarterly at the Board'sBoard’s regular meetings. The Fund CCO, who also serves as Janus Capital'sCapital’s Chief Compliance Officer, discusses relevant risk issues that may impact the Funds and/or Janus Capital'sCapital’s services to the Funds, and routinely meets with the Board in private without representatives of Janus Capital or its affiliates present. The Fund CCO also provides the Board with updates on the application of the Funds'Funds’ compliance policies and procedures, including how these procedures are designed to mitigate risk and what, if any, changes have been made to enhance the procedures. The Fund CCO may also report to the Board on an ad hoc basis in the event that he identifies issues associated with the Funds'Funds’ compliance policies and procedures that could expose the Funds'Funds to additional risk or adversely impact the ability of Janus Capital to provide services to the Funds. The Board believes that its leadership structure permits it to effectively discharge its oversight responsibilities with the respect to the Funds'Funds’ risk management process.
SHARE OWNERSHIP
The Trustee Share Ownership Under the Trust’s Governance Procedures and Guidelines, the Trustees believe that each Trustee shouldare expected to invest in one or more Janus
funds (but not necessarily all) funds advised by Janus Capital for which he or she servesthey serve as Trustee, to the extent the Trustee isthey are directly eligible to do so. The amount of such investment,
and the Janus fund(s) in which a Trustee determines to invest, is dictated by
the Trustee's individual financial circumstances and investment goals.
The Trustees and nominees cannot directly own shares of a Fund without
purchasing an insurance contract through one of the Participating Insurance
Companies or through a qualified plan. As a result, none of the Trustees or
nominees for election at the Meeting currently own any Fund shares. In addition,
as of [ ], the nominees, Trustees and executive officers of the Funds,
individually and collectively as a group, owned less than 1% of the outstanding
shares of each Fund. The Trustees and nominees own shares of other Janus funds
that are similarly managed as the Funds and managed by the same portfolio
managers, but available through different distribution channels. The following
table shows the aggregate dollar range of equity securities in all Janus funds
15
(52 funds as of December 31, 2009) owned directly or beneficially as
of , 2009 by each Trustee and the nominees for election at the
Meeting.
AGGREGATE DOLLAR RANGE OF EQUITY
SECURITIES IN ALL FUNDS OVERSEEN OR
TO BE OVERSEEN BY TRUSTEE/NOMINEE IN
NAME OF TRUSTEE/NOMINEE JANUS FAMILY OF FUNDS
----------------------- ------------------------------------
Independent Trustees
Jerome S. Contro..................... Over $100,000(1)
William F. McCalpin.................. Over $100,000
John W. McCarter, Jr. ............... Over $100,000
Dennis B. Mullen..................... Over $100,000(1)
James T. Rothe....................... Over $100,000
William D. Stewart................... Over $100,000
Martin H. Waldinger.................. Over $100,000(1)
Linda S. Wolf........................ Over $100,000(1)
Trustee Nominees
John H. Cammack...................... Over $100,000(2)
John P. McGonigle.................... Over $100,000
--------
(1) OwnershipThese investments may include amounts held under a deferred compensation plan that are valued based on "shadow investments"“shadow investments” in such funds. Such investments, including the amount and which funds, are dictated by each Trustee’s individual financial circumstances and investment goals. The Trustees and Trustee Nominee cannot directly own shares of the Funds without purchasing an insurance contract through one of the participating insurance companies or through a qualified retirement plan. To the best knowledge of the Trust, such Trustees as a group do not directly or beneficially own any outstanding shares of the Funds. The Trustees and Trustee Nominee may, however, own shares of certain other Janus mutual funds that have comparable investment objectives and strategies as the Funds but offered through different distribution channels. The table below gives the aggregate dollar range of securities of all mutual funds advised by Janus Capital and overseen by the Trustees ( funds as of December 31, 2016), owned by each Trustee and Trustee Nominee as of December 31, 2016: | | | | | | | | Name of Trustee/Trustee Nominee | | Dollar Range of Equity Securities in the Funds | | Aggregate Dollar Range of Equity Securities in All Registered Investment Companies Overseen by Trustee in Janus Funds | Independent Trustees | William F. McCalpin | | | | None | | | | Alan A. Brown | | | | None | | | | William D. Cvengros | | | | None | | | | Raudline Etienne | | | | None | | | | Gary A. Poliner | | | | None | | | | James T. Rothe | | | | None | | | | William D. Stewart | | | | None | | | | Linda S. Wolf | | | | None | | | | Diane L. Wallace | | | | None | | | |
(1)Ownership shown includes amounts held under a deferred compensation plan that are valued based on “shadow investments” in one or more funds.
(2) Ownership is as Compensation of February 8, 2010.
COMPENSATION OF TRUSTEES
Trustees The Trust pays each Independent Trustee an annual retainer plus a fee for each regular in-person meeting of the Trustees attended, a fee for in-person meetings of committees attended if convened on a date other than that of a regularly scheduled meeting, and a fee for telephone meetings of the Trustees and committees. In addition, committee chairschairs/leads and the Chairman of the Board of Trustees receive an additional supplemental retainer. Each current Independent Trustee also receives fees from other Janus funds for serving as Trustee of those funds and those amounts are included below. Janus Capital pays persons who
are directors, officers, or employees of Janus Capital or any affiliate thereof,
or any Trustee not considered an "independent"“independent” Trustee, for 34
their services as Trustees or officers.a Trustee. All of the Trustees or nomineesand the Trustee Nominee are "independent."“independent;” therefore, none of the Trustees are paid by Janus Capital. The Trust and other funds managed by Janus Capital may pay all or a portion of the compensation and related expenses of the Funds' Chief Compliance OfficerFund CCO and compliance staff, as well as certain Fund officers and Janus Capital employees, as authorized from time to time by the Trustees. The Trust'sTrust’s Nominating and Governance Committee, which consists solely of Independent Trustees, annually reviews and recommends to the Independent Trustees any changes to compensation paid by the Funds to the Independent Trustees. The Independent Trustees also meet at least annually to review their fees in connection with the recommendations of the Nominating and Governance Committee, to ensure that 16
such fees continue to be appropriate in light of the Trustees'Trustees’ responsibilities as well as in relation to fees paid to trustees of other similarly situated mutual fund complexes. The following table showstables set forth inAppendix G to this Proxy Statement show, for each Trustee, the aggregate compensation paid by each Fund to each current
Independent Trustee for its last fiscal year, as well as the total compensation paid by all Janus Funds to each Trustee for the calendar year ended December 31, 2016. Officers of the Trust and by all of the Janus funds during calendar
year 2009. None of the Trustees receives any pension or retirement benefits from
the Funds or the Janus funds. The Trustees have established a deferred
compensation plan under which the Trustees may elect to defer receipt of all, or
a portion, of the compensation they earn for their services to the Funds, in
lieu of receiving current payments of such compensation. Any deferred amount is
treated as though an equivalent dollar amount has been invested in shares of one
or more funds advised by Janus Capital ("Shadow Investments").
AGGREGATE TOTAL COMPENSATION
COMPENSATION FROM THE TRUST
FROM THE AND THE JANUS
NAME OF INDEPENDENT TRUSTEE TRUST(1) FUND COMPLEX(2)(3)
--------------------------- ------------ ------------------
William F. McCalpin(4)................. $376,000
Jerome S. Contro(5).................... $305,500
John W. McCarter, Jr.(5)............... $300,750
Dennis B. Mullen(5).................... $328,661
James T. Rothe(5)...................... $312,750
William D. Stewart(5).................. $296,750
Martin H. Waldinger.................... $267,000
Linda S. Wolf(5)....................... $273,750
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(1) Includes compensation for service on behalf of 14 Funds (as of December 31,
2009).
(2) For all Trustees, includes compensation for service on the boards of three
Janus trusts (the Trust, Janus Investment Fund and Janus Adviser Series)
comprised of 68 portfolios, and for two trusts (the Trust and Janus
Investment Fund) from July 2, 2009 to December 31, 2009, comprised of 52
portfolios. In addition, Mr. Mullen's compensation includes service on the
board of an additional trust, Janus Capital Funds Plc (an offshore product)
comprised of a total of 17 portfolios (as of December 31, 2009).
(3) Total Compensation received from the Janus funds includes any amounts
deferred under the deferred compensation plan. The deferred compensation
amounts for the period shown are as follows: Jerome S. Contro $152,250;
Martin H. Waldinger $66,750; and Linda S. Wolf $68,438.
(4) Aggregate Compensation received from the Funds and Total Compensation
received from all Janus funds includes additional compensation paid for
service as Independent Chairman of the Board of Trustees.
(5) Aggregate Compensation received from the Funds and Total Compensation
received from all Janus funds includes additional compensation paid for
service as chair of one or more committees of the Board of Trustees.
OFFICERS OF THE TRUST
The officers of the Trust and their principal occupations are set forth inAppendix BH to this Proxy Statement.
THE INDEPENDENT TRUSTEES OF THE TRUST UNANIMOUSLY RECOMMEND THAT YOU VOTE "FOR"
EACH NOMINEE.
17
PROPOSAL 2
APPROVE AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT
RELATED TO INTRODUCTION OF PERFORMANCE INCENTIVE
INVESTMENT ADVISORY FEE STRUCTURE
INTRODUCTION
On December 11, 2009, Shareholder Approval Election of the Trustee Nominee will be determined by the affirmative vote of a plurality (the greatest number of affirmative votes) of the shares of all funds of the Trust, including all Funds listed in this Proxy Statement and each other series of the Trust for which votes are being solicited pursuant to separate proxy statements. For purposes of determining the election of the Trustee Nominee, abstentions and broker non-votes will have no effect on the outcome of the vote. If elected by shareholders, it is expected that the Trustee Nominee will be seated as Trustees of the Trust prior to the first meeting of the Board of Trustees of the Trust held after the consummation of the Transaction. The election of the trustee nominee is contingent on the closing of the Transaction. If the Transaction is not consummated, the trustee nominee will not join the Board of Trustees. The Board unanimously recommends that shareholders of the Trust vote FOR the Trustee Nominee. 35
PROPOSAL 5 APPROVAL OF MANAGER OF MANAGERS PROPOSAL (All Funds except Global Unconstrained Bond Portfolio) The Board has approved, amendmentsand recommends that shareholders approve, a proposal authorizing the Adviser to enter into and materially amend sub-advisory agreements in the investment advisoryfuture with wholly-owned sub-advisers and unaffiliated sub-advisers, with the approval of the Board, but without obtaining additional shareholder approval (the “Manager of Managers Proposal”). The Manager of Managers Proposal Shareholder Approval of Sub-Advisory Agreements. Federal securities laws generally require that shareholders approve agreements with a sub-adviser. Shareholder approval also is required if the terms of existing sub-advisory agreements are changed materially or if there is a change in control of the sub-adviser. In order to obtain shareholder approval, a fund must call and conduct shareholder meetings, prepare and distribute proxy materials and solicit votes from shareholders. The process can be costly and time-consuming. The Board believes that it is in the Funds’ best interests if the Board represents their interests in approving or rejecting recommendations made by the Adviser regarding sub-advisers. This approach will avoid the costs and delays associated with holding shareholder meetings to obtain approval for future changes. SEC Exemptive Order. On July 29, 2014, the SEC granted an order exempting the Trust and the Adviser from the federal securities law requirements to obtain shareholder approval regarding sub-advisory agreements between Janus Capital and each of Forty
Portfolio, Janus Portfoliowholly-owned sub-advisers and Overseas Portfolio (for purposes of this Proposal
2, each of Forty Portfolio, Janus Portfolio and Overseas Portfolio is referredunaffiliated sub-advisers (the “SEC Exemptive Order”). The SEC Exemptive Order permits the Adviser to asselect sub-advisers to manage all or a "Fund" and collectively, the "Funds"). Each amendment changes the annual
rate of compensation paid to Janus Capital as your Fund's investment adviser
from a fixed rate of 0.64% to a rate that adjusts up or down based on the Fund's
performance relative to its benchmark index (the "Proposed Amended Advisory
Agreement"). This change in fee structure requires shareholder approval. The
Board of Trustees authorized the submissionportion of the Proposed Amended Advisory
Agreements to shareholders of the Funds for their approval, as described further
below. Shareholders of Forty Portfolio will vote on Proposal 2.a.; shareholders
of Janus Portfolio will vote on Proposal 2.b., and shareholders of Overseas
Portfolio will vote on Proposal 2.c. A form of a Proposed Amended Advisory
Agreement is attached to this Proxy Statement as Appendix C.
The proposal to implement a performance-based advisory fee is designed to
more closely align Janus Capital's interests with those of the Funds'
shareholders. The premise of a performance fee is that an investment adviser
should earn more if it is performing well for Fund shareholders and should earn
less if it is underperforming. To assess the performance of the investment
adviser, a Fund's performance is measured against the performance of the Fund's
primary benchmark. This means that it is the relative outperformance or
underperformance of a Fund compared to its benchmark, and not the Fund's
absolute performance, that causes the advisory fee to be adjusted up or down. As
a result, if the performance-based advisory fee is approved for your Fund, the
investment advisory fee paid by your Fund to Janus Capital will decrease when
the Fund is not performing well relative to its benchmark index and increases
during periods when the Fund outperforms its benchmark index. The section
entitled "Comparison of the Current and Proposed Amended Advisory Agreements"
below provides a detailed description of how the proposed performance-based
advisory fee would be calculated for your Fund, and also includes examples
showing the investment advisory fees your Fund would have paid if the proposed
performance-fee had been in place during the Fund's most recent fiscal year.
The Board of Trustees has previously approved performance-based advisory
fees for a number of other Janus funds, and, for the reasons described below,
believes that moving to a fee that adjusts up or down based on a Fund's
performance better aligns the interest of Janus Capital, each Fund's investment
adviser, with those of the Fund's shareholders. At the same time, Janus Capital
believes that the proposed advisory fee structure will enable it to maintain the
quality of services to the Funds and to attract and retain talented investment
personnel.
18
BOARD CONSIDERATION, APPROVAL AND RECOMMENDATION
At a meeting of the Trustees held on December 11, 2009, the Trustees, each
of whom are Independent Trustees, meaning he or she is not an "interested
person" (as defined by the 1940 Act) of the Trust ("Independent Trustees"),
voted unanimously to approve each Proposed Amended Advisory Agreement and
authorized the submission of each Proposed Amended Advisory Agreement to each
Fund's shareholders for approval. If approved, the Proposed Amended Advisory
Agreements will be in effect until February 1, 2011, and may continue in effect
thereafter from year to year if such continuation is specifically approved at
least annually by either the Board of Trustees or the affirmative vote of a 1940
Act Majority and, in either event, by the vote of a majority of the Independent
Trustees.
Over the past few years, the Independent Trustees and their independent fee
consultant, in consultation with independent legal counsel to the Independent
Trustees, have continued to explore the possibility of modifying the fee
structure for certain Janus funds to provide for a Base Fee Rate (as defined
below under "Comparison of the Current and Proposed Amended Advisory
Agreements - Proposed Performance Fee Structure") for each of those funds at the
same rate as its current advisory fee rate, and a performance-based adjustment
that would increase or decrease the fee based on whether the fund's total return
performance exceeds or lags a stated relevant benchmark index.
Working with Janus Capital to develop a performance structure that was
acceptable to Janus Capital, the Independent Trustees were seeking to provide a
closer alignment of the interests of Janus Capital with those of the Funds and
their shareholders. They believe that the fee structure proposed for the Funds
will achieve that objective. Included as part of their analysis of the overall
performance fee structure, the Trustees, in consultation with their independent
fee consultant, considered the appropriate performance range maximum and minimum
that would result in the Performance Adjustment of up to 0.15% (positive or
negative) of a Fund's average daily net assets during the applicable performance
measurement period. The Trustees reviewed information provided by Janus Capital
and prepared by their independent fee consultant with respect to an appropriate
deviation of excess/under returns relative to a Fund's benchmark index, taking
into consideration expected tracking error of the Fund, expected returns and
potential risks and economics involved for Janus Capital and the Fund's
shareholders. The Trustees also reviewed the structure of performance fees
applied by other Janus funds.
As described below, the Performance Adjustment that will be added to or
subtracted from the Base Fee Rate as a result of a Fund's performance, relative
to its benchmark index, is a variable rate of up to 0.15% of average net assets
during the performance measurement period. Importantly, the performance is
computed after deducting a Fund's operating expenses (including advisory fees),
which means that, in order to receive any upward adjustment from the Base Fee
Rate, Janus Capital must deliver a total return after expenses that exceeds the
return of the benchmark index, which does not incur any expenses.
19
The Trustees determined that the benchmark index specified in each Proposed
Amended Advisory Agreement for purposes of computing the Performance Adjustment
is appropriate for the applicable Fund based on a number of factors, including
that each index is broad-based and is composed of securities of the types in
which the Fund may invest. The Trustees believe that divergence between a Fund's
performance and performance of the index can be attributed, in part, to the
ability of the portfolio managers in making investment decisions within the
parameters of the Fund's investment objective and investment policies and
restrictions.
The time periods to be used in determining any Performance Adjustment were
also judged to be of appropriate length to ensure proper correlation and to
prevent fee adjustments from being based upon random or insignificant
differences between the performance of a Fund and of its benchmark index. In
that regard, the Trustees concluded that it would be appropriate for there to be
no adjustmententer into sub-advisory agreements with sub-advisers, and materially amend sub-advisory agreements with sub-advisers, subject to the Base Fee Rate for at least the first 12 months and up to 18
months after the effective dateapproval of the performance-based fees structure outlined
in each Proposed Amended Advisory Agreement and that, once implemented, the
Performance Adjustment should reflect only a Fund's performance subsequent to
that effective date. Moreover, the Trustees believed that, upon reaching the
thirty-sixth month after the effective date, the performance measurement period
should be fully implemented, and that the Performance Adjustment should
thereafter be based upon a 36-month rolling performance measurement period.
In considering the Proposed Amended Advisory Agreements, and the
performance fee structure reflected in the Agreements, the Independent Trustees
met in executive session and were advised by their independent legal counsel.
The Independent Trustees received and reviewed a substantial amount of
information provided by Janus Capital in response to requests of the Independent
Trustees and their counsel. They also considered information provided by their
independent fee consultant.
In considering whether to approve the Proposed Amended Advisory Agreements,
the Board, of Trustees noted that, except for the performance-based fee
structure, the Proposed Amended Advisory Agreements are substantially similar to
the Current Advisory Agreements, which were most recently approved by them at a
meeting held on December 11, 2009. The Board took into account the services
provided by Janus Capital in its capacity as investment adviser to the Funds and
concluded that the services provided were acceptable. Certain of these
considerations are discussed in more detail below. Based on their evaluation of
that information and other factors, on December 11, 2009, the Independent
Trustees approved the Proposed Amended Advisory Agreement for each Fund, subject
to shareholder approval.
NATURE, EXTENT AND QUALITY OF SERVICES
The Trustees reviewed the nature, extent and quality of the services
provided by Janus Capital, taking into account the investment objective and
strategies of each Fund and the knowledge the Trustees gained from their regular
meetings with management on at least a quarterly basis, and their ongoing review
of information related to the Funds. In addition, the Trustees reviewed the
resources and key personnel of Janus Capital,
20
especially those who provide investment management services to the Funds. The
Trustees also considered other services provided to the Funds by Janus Capital.
Janus Capital also advised the Board of Trustees that it expects that there will
be no diminution in the scope and quality of advisory services provided to the
Funds as a result of the Proposed Amended Advisory Agreements.
The Trustees concluded that the Proposed Amended Advisory Agreement for
each Fund was not expected to adversely affect the nature, extent or quality of
services provided to the Funds, and that the Funds would continue to benefit
from services provided under the Proposed Amended Advisory Agreements. They also
concluded that the quality of Janus Capital's services to each Fund has been
adequate. In reaching their conclusions, the Trustees considered: (i)
information provided by Janus Capital for their consideration of the Proposed
Amended Advisory Agreements; (ii) the key factors identified in materials
provided to the Trustees by their independent counsel; and (iii) the
reasonableness of the fees payable by shareholders of each Fund. They also
concluded that Janus Capital's financial condition was sound.
COSTS OF SERVICES PROVIDED
The Trustees considered the fee structure under the Proposed Amended
Advisory Agreements, as well as the overall fee structure of the Funds. The
Trustees examined the fee information and expenses for the Funds in comparison
to information for other comparable funds, as provided by Lipper.
The Trustees considered the structure by which Janus Capital would be paid
for their services, including the implementation of the new performance-based
fee structure for each Fund. The Trustees also considered the overall fees of
each Fund for services provided to the Fund.
The Trustees concluded that the estimated overall expense ratio of each
Fund was comparable to or more favorable than the median expense ratio of its
peers, and that the fees that the Fund will pay to Janus Capital are reasonable
in relation to the nature and quality of the services to be provided, taking
into consideration (1) the fees charged by other advisers for managing
comparable mutual funds with similar strategies, and (2) the impact of the
performance-based fee structure, as applicable.
PERFORMANCE OF THE FUNDS
The Trustees considered the performance results of the Funds over various
time periods. They reviewed information comparing each Fund's performance with
the performance of comparable funds and peer groups identified by Lipper, and
with each Fund's benchmark index. They concluded that the performance of the
Funds was acceptable under current market conditions. [Although the performance
of the Funds lagged benchmark indices for certain periods,] the Trustees also
concluded that the manner in which Janus Capital addressed those instances of
underperformance was appropriate.
21
OTHER BENEFITS FROM THE RELATIONSHIP WITH JANUS CAPITAL
The Trustees also considered benefits that would accrue to the Funds from
their relationship with Janus Capital. The Trustees concluded that, other than
the services to be provided by Janus Capital pursuant to the Proposed Amended
Advisory Agreements and the fees to be paid by the Funds for such services, the
Funds and Janus Capital may potentially benefit from their relationship with one
another in other ways. They also concluded that success of the relationship
between the Funds and Janus Capital could attract other business to Janus
Capital or to other Janus funds, and that the success of Janus Capital could
enhance the firm's ability to serve the Funds. They also concluded that Janus
Capital may potentially benefit from the receipt of proprietary and third-party
research products and services to be acquired through commissions paid on
portfolio transactions of the Funds or other funds in the Janus complex, and
that the Funds may potentially benefit from Janus Capital's receipt of those
products and services, as well as research products and services acquired
through commissions paid by other clients of Janus Capital. The Trustees further
concluded that Janus Capital's use of "soft" commission dollars to obtain
proprietary and third-party research products and services was consistent with
regulatory requirements and guidelines and was likely to benefit the Funds.
After full consideration of the above factors, as well as other factors,
the Trustees concluded that approving the Proposed Amended Advisory Agreement
for each Fund was in the best interest of each Fund and its shareholders. The
Trustees, each of whom is an Independent Trustee, voted to approve the Proposed
Amended Advisory Agreements and to recommend them to shareholders for their
approval.
INFORMATION CONCERNING THE ADVISER
Janus Capital, 151 Detroit Street, Denver, Colorado 80206-4805, serves as
investment adviser to the Funds pursuant to a separate investment advisory
agreement between the Trust, on behalf of each Fund, and Janus Capital, each
dated July 1, 2004 (each, a "Current Advisory Agreement" and collectively, the
"Current Advisory Agreements"). Janus Capital is a direct subsidiary of Janus
Capital Group Inc. ("JCGI"), a publicly traded company with principal operations
in financial asset management businesses that had $159.7 billion in assets under
management as of December 31, 2009. JCGI owns approximately 95% of Janus
Capital, with the remaining 5% held by Janus Management Holdings Corporation.
Certain employees of Janus Capital and/or its affiliates serve as officers of
the Trust. Certain officers of the Trust are shareholders of JCGI.
Janus Capital (together with its predecessors) has served as an investment
adviser since 1970. As of December 31, 2009, the Janus funds that Janus Capital
advises consisted of 52 portfolios offering a broad range of investment
objectives, including those with similar investment objectives as the Funds (see
attached Appendix D for further information). Janus Capital also serves as
subadviser for a number of private-label mutual funds and provides separate
account advisory services for institutional accounts.
22
Principal Executive Officers and Directors of the Adviser. The principal
executive officers and directors of Janus Capital and their principal
occupations are included in Appendix E to this Proxy Statement.
COMPARISON OF THE CURRENT AND PROPOSED AMENDED ADVISORY AGREEMENTS
Except for the change in fee structure to a performance-based advisory fee
and the dates of execution, the terms of the Current Advisory Agreements and the
Proposed Amended Advisory Agreements are the same. A summary of these agreements
is provided below.
Advisory Services. The terms of the advisory services are the same under
the Current Advisory Agreements and the Proposed Amended Advisory Agreements.
Janus Capital provides each Fund with continuing investment management
services. Janus Capital is responsible for the day-to-day management of each
Fund and for providing continuous investment advice regarding the purchase and
sale of securities held by the Funds, subject to (i) the Trust's Amended and
Restated Trust Instrument and Bylaws; (ii) the investment objectives, policies
and restrictions set forth in the Trust's registration statement; (iii) the
provisions of the 1940 Act and the Internal Revenue Code of 1986, as amended;
and (iv) such other policies and instructions as the Trustees may from time to
time determine.
Janus Capital provides office space for each Fund and pays the salaries,
fees, and expenses of all Fund officers (sharing certain expenses and salaries
for the Funds' Chief Compliance Officer and other compliance-related personnel
as authorized by the Trustees from time to time). Janus Capital provides certain
administrative services to each Fund as described under "Fund Service Providers"
and is responsible for the other business affairs of each Fund. Janus Capital is
authorized to delegate to others to perform certain administrative and other
services.
Each Fund pays all expenses incidental to its organization, operations and
business not specifically assumed by Janus Capital, including custodian and
transfer agency fees and expenses, brokerage commissions and dealer spreads, and
other expenses in connection with the execution of portfolio transactions, legal
and accounting expenses, interest, taxes, a portion of trade association or
other investment company organization dues and expenses, registration fees,
expenses of shareholders' meetings, reports to shareholders, fees and expenses
of Independent Trustees, and other costs of complying with applicable laws
regulating the sale of Fund shares. Information concerning services provided by
Janus Distributors LLC ("Janus Distributors"), the Funds' distributor, and Janus
Services LLC ("Janus Services"), the Funds' transfer agent, each a wholly-owned
subsidiary of Janus Capital, and a description of any fees paid by each Fund to
Janus Distributors and Janus Services, is included under "Fund Service
Providers" in this Proxy Statement.
Liability. Each Fund's Current Advisory Agreement and Proposed Amended
Advisory Agreement provides that Janus Capital shall not be liable for any error
of judgment or mistake of law or for any loss arising out of any investment or
for any act or
23
omission taken with respect to the Fund, 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 under the agreement, and except
to the extent otherwise provided by law.
Termination of the Agreement. Each Fund's Current Advisory Agreement and
Proposed Amended Advisory Agreement continues in effect until February 1, 2011,
and from year to year thereafter, so long as such continuance is specifically
approved at least annually by a majority of the Fund's Independent Trustees, and
by either a majority of the outstanding voting securities of the Fund or the
Board of Trustees. The "majority of outstanding voting securities" means the
lesser of (i) 67% or more of the shares of a Fund present at the Meeting, if the
holders of more than 50% of the outstanding shares are present or represented by
proxy, or (ii) more than 50% of the outstanding shares (a "1940 Act Majority").
The Current Advisory Agreements and the Proposed Amended Advisory
Agreements each: (i) may be terminated, without penalty, by a 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, including a majority of the Independent Trustees, and, towithout obtaining shareholder approval. Before a Fund may rely on the extent requiredSEC Exemptive Order, the operation of the Fund in the manner permitted by the 1940 Act,SEC Exemptive Order must be approved by shareholders. Under the voteSEC Exemptive Order, the Trust and the Adviser are subject to several conditions imposed by the SEC to ensure that the interests of the Funds’ shareholders are adequately protected. Among these conditions are that within 90 days of the hiring of a 1940 Act
Majority.
Additional Information. The datenew sub-adviser, a Fund will provide shareholders with an information statement, or with a notice of the Current Advisory Agreements
between Janus Capital and each Fund,availability of such information statement, that contains substantially the date they were last considered and
reviewed bysame information about the Trustees,sub-adviser, the date when they were last approved by shareholders
of each Fund,sub-advisory agreement and the reason it was last submitted for shareholder approval are
set forth below:
DATE LAST DATE LAST
DATE OF CURRENT CONSIDERED BY SUBMITTED TO
FUND AGREEMENT TRUSTEES SHAREHOLDERS REASON
---- -------------------- ----------------- ------------ ------
Forty Portfolio..... July 1, 2004 as December 11, 2009
amended February 1,
2006 and June 14,
2006
Janus Portfolio..... July 1, 2004 as December 11, 2009
amended February 1,
2006 and June 4,
2006
Overseas Portfolio.. July 1, 2004 as December 11, 2009
amended February 1,
2006 and June 14,
2006
The implementation of each Proposed Amended Advisory Agreement forsub-advisory fee that the Fund would otherwise have been required to send to shareholders in a Fund
is contingent upon shareholderproxy statement.Shareholder approval of that Fund.
Compensation. Pursuant to its Current Advisory Agreement, each Fund pays
Janus Capital an investment advisory fee for its services, which is calculated
daily and paid monthly. The investment advisory fee paid by each Fund to Janus
Capital under its
24
Current Advisory Agreement is calculated at an annual fixed ratethe Manager of 0.64% of a
Fund's average daily net asset value.
Under each Fund's Proposed Amended Advisory Agreement, the advisory fee
paid would consist of an annual base fee and a performance fee adjustment. The
base fee would be the same as the current fixed rate at 0.64%, but would be
subject to an adjustment up or down based on the Fund's performance relative to
its respective benchmark index, as discussed in further detail below.
Proposed Performance Fee Structure. The proposed investment advisory fee
to be paid to Janus Capital by each FundManagers Proposal will consist of two components: (1) a
base fee calculated by applying the current contractual fixed-rate advisory fee
rate of 0.64% to a Fund's average daily net assets during the previous month
("Base Fee Rate"), plus or minus (2) a performance-fee adjustment ("Performance
Adjustment") calculated by applying a variable rate of up to 0.15% (positive or
negative) to the Fund's average daily net assets during the applicable
performance measurement period. The performance measurement period generally
will be the previous 36 months, although no Performance Adjustment will be made
until the Proposed Amended Advisory Agreement has been in effect for at least 12
months for Janus Portfolio; 15 months for Overseas Portfolio; or 18 months for
Forty Portfolio. When the Proposed Amended Advisory Agreement has been in effect
for at least 12 months (15 months for Overseas Portfolio and 18 months for Forty
Portfolio), but less than 36 months, the performance measurement period will be
equal to the time that has elapsed since the Proposed Amended Advisory Agreement
took effect. The Base Fee Rate is calculated and accrued daily. The Performance
Adjustment is calculated monthly in arrears and is accrued evenly each day
throughout the month. The investment advisory fee is paid monthly in arrears.
The Performance Adjustment maynot result in an increase or decrease in the total amount of investment advisory fee ratefees that would be paid by a Fund depending onto the Adviser. Board Considerations The Board believes that it is in the best interest of each Fund to afford the Adviser the flexibility to provide investment performanceadvisory services to each Fund through one or more sub-advisers that have particular expertise in the type of investments in which a Fund invests. As described above, without the ability to utilize the SEC Exemptive Order, in order for the Adviser to appoint a new sub-adviser or modify a sub-advisory agreement materially, the Board must call and hold a shareholder meeting of that Fund, create and distribute proxy materials and solicit votes from the Fund’s shareholders. This process is time consuming and costly. Without the delay inherent in holding shareholder meetings, the Adviser would be able to act more quickly to appoint a new sub-adviser if and when the Board and the Adviser believe that the appointment would benefit the Fund. The Board believes that granting the Adviser (subject to review and approval by the Board) maximum flexibility to select sub-advisers, without incurring the delay or expense of obtaining further shareholder approval, is in the best interest of the Funds because it will allow each Fund relative to its benchmark index overoperate more efficiently. 36
In addition, the performance
measurement period. No Performance Adjustment will be applied unlessBoard believes that it is appropriate to vest the difference between a Fund's investment performanceselection of sub-advisers in the Adviser (subject to review and approval by the investment recordBoard) in light of the Fund's benchmark is 0.50%Adviser’s investment advisory expertise and its experience in selecting sub-advisers. The Board believes that if in the future it becomes appropriate to add or greater (positive or negative) during the
applicable performance measurement period. Because the Performance Adjustment is
tiedchange a sub-adviser to a Fund's performance relativeyour Fund, it can access this expertise and experience in ways that can add value to its benchmark index (and not its
absolute performance), the Performance Adjustment could increase Janus Capital's
fee even if the Fund's shares lose value during the performance measurement
period, and could decrease Janus Capital's fee even if the Fund's shares
increase in value during the performance measurement period. For purposes of
computing the Base Fee Rate and the Performance Adjustment, net assets will be
averaged over different periods (average daily net assets during the previous
month for the Base Fee Rate, versus average daily net assets during the
performance measurement period for the Performance Adjustment). Performance of a
Fund is calculated net of expenses, whereas a Fund's benchmark index does not
have any fees or expenses. Reinvestment of dividends and distributions are
included in calculating the performance of both the Fund and its benchmark
index.
25
The investment performance of a Fund's Service Shares ("Service Shares")
forshareholders. Although no new sub-advisory arrangements or changes to any Fund’s existing sub-advisory arrangement are being recommended in connection with the performance measurement period will be usedTransaction, the Adviser expects to calculatecontinue to evaluate these relationships, including evaluating the Performance
Adjustment. After Janus Capital determines whether a particular Fund's
performance was above or below its benchmark index by comparing the investment
performancecapabilities of the Fund's Service Shares againstexisting Sub-Advisers, the investment recordcapabilities of other possible sub-advisers and the enhanced capabilities of Janus Henderson, assuming the Transaction occurs. If that Fund's benchmark index, Janus Capitalevaluation results in a recommendation to implement a new sub-advisory relationship or change any existing sub-advisory relationship, either in connection with the Transaction or separately, that recommendation could not be implemented without Board approval. Finally, the Board believes that it will applyretain sufficient oversight of each Fund’s sub-advisory arrangements to seek to ensure that shareholders’ interests are protected whenever the same Performance Adjustment
(positiveAdviser selects a sub-adviser or negative) across each other class of shares of the Fund.modifies a sub-advisory agreement. The Trustees may determine that a class of shares of the Fund other than
Service Shares is the most appropriate for use in calculating the Performance
Adjustment. If a different class of shares is substituted in calculating the
Performance Adjustment, the use of that successor class of shares may applyBoard will continue to the entire performance measurement periodevaluate and to approve all proposed sub-advisory agreements, as well as any proposed modifications to existing sub-advisory agreements. In doing so, long as the successor class was
outstanding at the beginning of such period. If the successor class of shares
was not outstanding for all or a portion of the performance measurement period,
it may only be used in calculating that portion of the Performance Adjustment
attributable to the period during which the successor class was outstanding, and
any prior portion of the performance measurement period would be calculated
using the class of shares previously designated. Any change to the class of
shares used to calculate the Performance Adjustment is subject to applicable
law. The Trustees would notify you of any such change.
Each Fund's benchmark index is identified below. The Trustees may from time
to time determine that another securities index is a more appropriate benchmark
index for purposes of evaluating the performance of that Fund. In that event, the Trustees will approveanalyze such factors that they consider to be relevant to the substitutiondetermination. The terms of a successor indexeach sub-advisory agreement will include those required by applicable provisions of the 1940 Act, except for the Fund's
benchmark index. However, the calculationspecific provisions of the Performance Adjustment for any
portion of the performance measurement period prior to the adoption of the
successor index will still be based upon the Fund's performance compared to its
former benchmark index. Any change to a Fund's benchmark index for purposes of
calculating the Performance Adjustment is subject to applicable law. It is
currently the position of the Staff of1940 Act from which the SEC that any changesExemptive Order provides relief. Shareholder Approval To become effective with respect to a Fund's
benchmark index will require shareholder approval. If there is a change in the
Staff's position, the Trustees intend to notify shareholders if they determine
that a change in a Fund's benchmark index is appropriate.
While it is not possible to predict the effect of the Performance
Adjustment on future overall compensation to Janus Capital since it will depend
on the performance of each Fund relative to the record of its benchmark index
and future changes to the size of each Fund, below is information to help you
evaluate the potential impact of this change.
If the average daily net assets of a Fund remain constant during a 36-month
performance measurement period, current net assets will be the same as average
net assets over the performance measurement period, and the maximum Performance
Adjustment will be equivalent to 0.15% of current net assets. When current net
assets vary from average net assets over the 36-month performance measurement
period, the Performance Adjustment, as a percentage of current assets, may vary
significantly, including at a rate more or less than 0.15%, depending upon
whether the net assets of the Fund had been increasing or decreasing (and the
amount of such increase or decrease)
26
during the performance measurement period. Note that if net assets for a Fund
were increasing during the performance measurement period, the total performance
fee paid, measured in dollars, would be more than if that Fund had not increased
its net assets during the performance measurement period.
Suppose, for example, that the Performance Adjustment was being computed
after the assets of a Fund had been shrinking. Applying the monthly Base Fee
Rate of 1/12(th) of 0.64% of average daily net assets during the previous month,
assume that average daily net assets during the 36-month performance measurement
period were $500 million, but that average daily net assets during the preceding
month were just $200 million.
The Base Fee Rate would be computed as follows:
$200 million x 0.64% / 12 = $106,667
If the Fund outperformed or underperformed its benchmark index by an amount
which triggered the maximum Performance Adjustment, the Performance Adjustment
would be computed as follows:
$500 million x 0.15% / 12 = $62,500, which is approximately 1/12th of
0.375% of $200 million.
If the Fund had outperformed its benchmark index, the advisory fee rate for
that month would be a Base Fee Rate of $106,667, plus a Performance Adjustment
of $62,500, for a total fee of $169,167, which is approximately 1/12th of 1.01%
of $200 million.
If the Fund had underperformed its benchmark index, the advisory fee rate
for that month would be a Base Fee Rate of $106,667, minus a Performance
Adjustment of $62,500, for a total fee of $44,167, which is approximately 1/12th
of 0.26% of $200 million.
Therefore, the total advisory fee rate for that month, as a percentage of
average net assets during the preceding month, would be approximately 1/12th of
1.01% in the case of outperformance, or approximately 1/12th of 0.26% in the
case of underperformance. Under extreme circumstances involving underperformance
by a rapidly shrinking Fund, the dollar amount of the Performance Adjustment
could be more than the dollar amount of the Base Fee Rate. In such
circumstances, Janus Capital would reimburse the Fund.
By contrast, the Performance Adjustment would be a smaller percentage of
current assets if the net assets of the Fund were increasing during the
performance measurement period. Suppose, for example, that the Performance
Adjustment was being computed after the assets of the Fund had been growing.
Assume its average daily net assets during the 36-month performance measurement
period were $500 million, but that average daily net assets during the preceding
month were $800 million.
The Base Fee Rate would be computed as follows:
$800 million x 0.64% / 12 = $426,667
27
If the Fund outperformed or underperformed its benchmark index by an amount
which triggered the maximum Performance Adjustment, the Performance Adjustment
would be computed as follows:
$500 million x 0.15% / 12 = $62,500, which is approximately 1/12th of
0.094% of $800 million.
If the Fund had outperformed its benchmark index, the advisory fee rate for
that month would be a Base Fee Rate of $426,667, plus a Performance Adjustment
of $62,500, for a total fee of $489,167, which is approximately 1/12th of 0.73%
of $800 million.
If the Fund had underperformed its benchmark index, the advisory fee rate
for that month would be a Base Fee Rate of $426,667, minus a Performance
Adjustment of $62,500, for a total fee of $364,167, which is approximately
1/12th of 0.55% of $800 million.
Therefore, the total advisory fee rate for that month, as a percentage of
average net assets during the preceding month, would be approximately 1/12th of
0.73% in the case of outperformance, or approximately 1/12th of 0.55% in the
case of underperformance.
If approved for a Fund, the Proposed Amended Advisory Agreement, including
the performance-based advisory fee structure, described in thisManager of Managers Proposal is
expected to become effective on or about [July 1, 2010]. However, as noted
above, no Performance Adjustment willmust be made until the Proposed Amended
Advisory Agreement has been in effect for at least 12 months in the case of
Janus Portfolio; 15 months in the case of Overseas Portfolio; or 18 months in
the case of Forty Portfolio. Until such time, only the Fund's Base Fee Rate will
apply.
The proposed Base Fee Rate for each Fund (which is the same as the current
annual investment advisory fee rate paidapproved by each Fund to Janus Capital) and each
Fund's benchmark index are shown in the following table:
BASE FEE RATE
FUND BENCHMARK INDEX (ANNUAL FEE RATE)
---- ----------------------------------------- -----------------
Forty Portfolio........ Russell 1000(R) Growth Index(1) 0.64%
Janus Portfolio........ Russell 1000(R) Growth Index(1) 0.64%
Overseas Portfolio..... MSCI All Country World ex-U.S. IndexSM(2) 0.64%
--------
(1) The Russell 1000(R) Growth Index measures the performance of those Russell
1000(R) companies with higher price-to-book ratios and higher forecasted
growth values.
(2) The Morgan Stanley Capital International (MSCI) All Country World ex-U.S.
Index(SM) is an unmanaged, free float-adjusted, market capitalization
weighted index composed of stocks of companies located in countries
throughout the world, excluding the United States. It is designed to measure
equity market performance in global developed and emerging markets outside
the United States. The index includes reinvestment of dividends, net of
foreign withholding taxes.
28
COMPARISON OF CURRENT AND PRO FORMA ADVISORY FEES DURING THE PREVIOUS FISCAL
YEAR
The following table shows: (1) the dollar amount of the actual advisory
fees paid by each Fund for the fiscal year ended December 31, 2009; (2) the
dollar amount of the pro forma advisory fees that would have been paid by each
Fund if the proposed performance-based fee structure had been in effect during
such fiscal year; and (3) for each Fund, the difference between (i) the amount
of the pro forma advisory fees that would have been paid under the performance-
based fee structure and (ii) the amount of the actual advisory fees paid
expressed as a percentage of the actual advisory fees' amount. Such percentage
difference is positive when the amount of the pro forma advisory fees would have
been larger than the amount of the actual advisory fees paid by a Fund, and
negative when the amount of the pro forma advisory fees would have been smaller
than the amount of the actual advisory fees paid by a Fund. For purposes of pro
forma calculations, it is assumed that the Performance Adjustment would have
been in effect during the entire fiscal year ended December 31, 2009 and that it
would have been calculated over the full preceding 36-month performance
measurement period. No fee waivers are in effect during any of the periods
noted.
ACTUAL ADVISORY FEES PRO FORMA ADVISORY FEES
------------------------------------- --------------------------------------
ACTUAL ACTUAL PRO FORMA PRO FORMA DIFFERENCE
ADVISORY ADVISORY ADVISORY ADVISORY FEE BETWEEN
FEE BEFORE FEE AFTER FEE BEFORE PRO FORMA AFTER PRO FORMA
WAIVER WAIVER WAIVER WAIVER* WAIVER* WAIVER* AND ACTUAL
FUND ($) (000'S) ($) (000'S) ($) (000'S) ($) (000'S) ($) (000'S) ($) (000'S) ADVISORY FEE
---- ----------- ----------- ----------- ----------- ----------- ------------ ------------
Forty Portfolio.... 6,408 N/A 6,408 7,446 N/A 7,446 16.19%
Janus Portfolio.... 12,199 N/A 12,199 12,198 N/A 12,198 -0.01%
Overseas
Portfolio........ 11,715 N/A 11,715 14,671 N/A 14,671 25.23%
--------
* As described below in this Proxy Statement, any Performance Adjustment
included in calculating the Pro Forma Advisory Fees for each Fund is based
on the investment performance of the Fund's Service Shares versus the Fund's
benchmark index over the 36-month period ended December 31, 2009.
2.a. FORTY PORTFOLIO
HYPOTHETICAL EXAMPLE
The following hypothetical examples illustrate the application of the
Performance Adjustment for Forty Portfolio. The examples assume that the average
daily net assets of the Fund remain constant during a 36-month performance
measurement period. The Performance Adjustment would be a smaller percentage of
current assets if the net assets of the Fund were increasing during the
performance measurement period, and a greater percentage of current assets if
the net assets of the Fund were decreasing during the performance measurement
period. All numbers in the examples are rounded to the nearest hundredth
percent. The net assets of the Fund as of the fiscal years ended December 31,
2008 and December 31, 2009 were $827,195,677 and $1,222,490,446, respectively.
29
The monthly maximum positive or negative Performance Adjustment of 1/12th
of 0.15% of average net assets during the prior 36 months occurs if the Fund
outperforms or underperforms its benchmark index by 8.50% over the same period.
The Performance Adjustment is made in even increments for every 0.50% difference
in the investment performance of the Fund's Service Shares compared to the
investment record of the Russell 1000(R) Growth Index.
EXAMPLE 1: FUND OUTPERFORMS ITS BENCHMARK BY 8.50%
If the Fund has outperformed the Russell 1000(R) Growth Index by 8.50%
during the preceding 36 months, the Fund would calculate the investment advisory
fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 1/12(th) of 0.15% 1/12(th) of 0.79%
EXAMPLE 2: FUND PERFORMANCE TRACKS ITS BENCHMARK
If Fund performance has tracked the performance of the Russell 1000(R)
Growth Index during the preceding 36 months, the Fund would calculate the
investment advisory fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 0.00% 1/12(th) of 0.64%
EXAMPLE 3: FUND UNDERPERFORMS ITS BENCHMARK BY 8.50%
If the Fund has underperformed the Russell 1000(R) Growth Index by 8.50%
during the preceding 36 months, the Fund would calculate the investment advisory
fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 1/12(th) of - 0.15% 1/12(th) of 0.49%
COMPARISON OF CURRENT AND PRO FORMA EXPENSES
The following tables describe the shareholder fees and annual fund
operating expenses that you may pay if you buy and hold shares of the Fund under
the current fee structure and proposed performance-based fee structure. No fee
waivers are in effect so all numbers are shown gross of expenses. For purposes
of pro forma calculations, it is assumed that the Performance Adjustment would
have been in effect during the entire fiscal year ended December 31, 2009, and
that it would have been calculated over a full 36-month performance measurement
period. The fees and expenses shown were determined based upon average net
assets as of the fiscal year ended December 31, 2009. For the 36-month period
ended December 31, 2009, the Fund outperformed the Russell 1000(R) Growth Index
and the fiscal year-end average daily net assets were lower
30
than the trailing 36-month average daily net assets, resulting in the pro forma
management fee shown in the Annual Fund Operating Expenses table below.
Shareholder fees are those paid directly from your investment and may
include sales loads, redemption fees or exchange fees. The Fund is a no-load
investment, so you will generally not pay any shareholder fees when you buy or
sell shares of the Fund. However, each variable insurance contract involves fees
and expenses not described herein. See your contract prospectus for information
regarding contract fees and expenses, and any restrictions on purchases or
allocations.
Annual fund operating expenses are paid out of the Fund's assets and
include fees for portfolio management, maintenance of shareholder accounts,
shareholder servicing, accounting and other services. You do not pay these fees
directly but, as the examples show, these costs are borne indirectly by all
shareholders.
The tables and examples provided below are designed to assist participants
in qualified plans that invest in shares of the Fund in understanding the fees
and expenses that you may pay as an investor in the Fund. THE TABLES AND
EXAMPLES DO NOT REFLECT DEDUCTIONS AT THE SEPARATE ACCOUNT LEVEL FOR ANY CHANGES
THAT MAY BE INCURRED UNDER A CONTRACT. INCLUSION OF THESE CHARGES WOULD INCREASE
THE FEES AND EXPENSES DESCRIBED BELOW.
SHAREHOLDER FEES (PAID DIRECTLY FROM YOUR INVESTMENT)
SERVICE INSTITUTIONAL
SHARES SHARES
------- -------------
(CURRENT AND PRO FORMA STRUCTURE)
Maximum Sales Charge (Load) Imposed on Purchases
(as a % of offering price)........................... None None
Redemption Fee......................................... None None
Exchange Fee........................................... None None
ANNUAL FUND OPERATING EXPENSES (DEDUCTED FROM FUND ASSETS)(1)
TOTAL
ANNUAL
FUND
MANAGEMENT DISTRIBUTION OTHER OPERATING
FEE(2) (12b-1) FEES(3) EXPENSES(4) EXPENSES
---------- --------------- ----------- ---------
FORTY PORTFOLIO
Service Shares
Current............... 0.64% 0.25% 0.04% 0.93%
Pro Forma............. 0.74% 0.25% 0.04% 1.03%
Institutional Shares
Current............... 0.64% N/A 0.04% 0.68%
Pro Forma............. 0.74% N/A 0.04% 0.78%
31
EXAMPLES:
THE FOLLOWING EXAMPLES ARE BASED ON EXPENSES AS SHOWN IN THE TABLES
ABOVE. These examples are intended to help you compare the cost of investing in
the Fund, under both the current fee structure and the proposed fee structure,
with the cost of investing in other mutual funds. The examples assume that you
invest $10,000 in the Fund for the time periods indicated, reinvest all
dividends and distributions, and then redeem all of your shares at the end of
each period. Since no sales load applies, the results apply whether or not you
redeem your shares at the end of the periods shown below. The examples also
assume that your investment has a 5% return each year and that the Fund's
operating expenses remain the same. The pro forma calculations assume that the
Performance Adjustment had been in effect for a 36-month period as of the end of
the last fiscal year (December 31, 2009). Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
FORTY PORTFOLIO
Service Shares
Current........................ $ 95 $296 $515 $1,143
Pro Forma(*)................... 105 328 569 1,259
Institutional Shares
Current........................ 69 218 379 847
Pro Forma(*)................... 80 249 433 966
--------
(1) All expenses are shown without the effect of expense offset arrangements.
Pursuant to such arrangements, credits realized as a result of uninvested
cash balances are used to reduce custodian and transfer agent expenses.
(2) The "Management Fee" is the investment advisory fee rate paid by the Fund to
Janus Capital. Any Performance Adjustment included in calculating the Pro
Forma Management Fee as shown is based on the investment performance of the
Fund's Service Shares versus the Russell 1000(R) Growth Index over the 36-
month period ended December 31, 2009. Once the Performance Adjustment is
determined, it is applied across each other class of shares of the Fund.
(3) Because the 12b-1 fee is charged as an ongoing fee, over time the fee will
increase the cost of your investment and may cost you more than paying other
types of sales charges.
(4) "Other Expenses" include acquired fund fees and expenses. "Acquired Fund"
means any underlying fund (including, but not limited to, exchange-traded
funds) in which a Portfolio invests or has invested during the period. Total
Annual Fund Operating Expenses shown may not correlate to the Fund's "ratio
of gross expenses to average net assets" appearing in the Fund's financial
statements, which reflect the operating expenses of the Fund and does not
include Acquired Fund fees and expenses. Amounts less than 0.01%, if
applicable, are included in Other Expenses.
* The Pro Forma numbers shown include a pro forma management fee calculated as
described in the text and related footnotes that accompany the fee table
above.
32
2.b. JANUS PORTFOLIO
HYPOTHETICAL EXAMPLE
The following hypothetical examples illustrate the application of the
Performance Adjustment for Janus Portfolio. The examples assume that the average
daily net assets of the Fund remain constant during a 36-month performance
measurement period. The Performance Adjustment would be a smaller percentage of
current assets if the net assets of the Fund were increasing during the
performance measurement period, and a greater percentage of current assets if
the net assets of the Fund were decreasing during the performance measurement
period. All numbers in the examples are rounded to the nearest hundredth
percent. The net assets of the Fund as of the fiscal years ended December 31,
2008 and December 31, 2009 were $1,505,286,603 and $2,488,816,223, respectively.
The monthly maximum positive or negative Performance Adjustment of 1/12th
of 0.15% of average net assets during the prior 36 months occurs if the Fund
outperforms or underperforms its benchmark index by 4.00% over the same period.
The Performance Adjustment is made in even increments for every 0.50% difference
in the investment performance of the Fund's Service Shares compared to the
investment record of the Russell 1000(R) Growth Index.
EXAMPLE 1: FUND OUTPERFORMS ITS BENCHMARK BY 4.00%
If the Fund has outperformed the Russell 1000(R) Growth Index by 4.00%
during the preceding 36 months, the Fund would calculate the investment advisory
fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 1/12(th) of 0.15% 1/12(th) of 0.79%
EXAMPLE 2: FUND PERFORMANCE TRACKS ITS BENCHMARK
If Fund performance has tracked the performance of the Russell 1000(R)
Growth Index during the preceding 36 months, the Fund would calculate the
investment advisory fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 0.00% 1/12(th) of 0.64%
EXAMPLE 3: FUND PERFORMANCE UNDERPERFORMS ITS BENCHMARK BY 4.00%
If the Fund has underperformed the Russell 1000(R) Growth Index by 4.00%
during the preceding 36 months, the Fund would calculate the investment advisory
fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 1/12(th) of -0.15% 1/12(th) of 0.49%
33
COMPARISON OF CURRENT AND PRO FORMA EXPENSES
The following tables describe the shareholder fees and annual fund
operating expenses that you may pay if you buy and hold shares of the Fund under
the current fee structure and proposed performance-based fee structure. No fee
waivers are in effect so all numbers are shown gross of expenses. For purposes
of pro forma calculations, it is assumed that the Performance Adjustment would
have been in effect during the entire fiscal year ended December 31, 2009, and
that it would have been calculated over a full 36-month performance measurement
period. The fees and expenses shown were determined based upon average net
assets as of the fiscal year ended December 31, 2009. For the 36-month period
ended December 31, 2009, the Fund underperformed the Russell 1000(R) Growth
Index and the fiscal year-end average daily net assets were higher than the
trailing 36-month average daily net assets, resulting in the pro forma
management fee shown in the Annual Fund Operating Expenses table below.
Shareholder fees are those paid directly from your investment and may
include sales loads, redemption fees or exchange fees. The Fund is a no-load
investment, so you will generally not pay any shareholder fees when you buy or
sell shares of the Fund. However, each variable insurance contract involves fees
and expenses not described herein. See your contract prospectus for information
regarding contract fees and expenses, and any restrictions on purchases or
allocations.
Annual fund operating expenses are paid out of the Fund's assets and
include fees for portfolio management, maintenance of shareholder accounts,
shareholder servicing, accounting and other services. You do not pay these fees
directly but, as the examples show, these costs are borne indirectly by all
shareholders.
The tables and examples provided below are designed to assist participants
in qualified plans that invest in shares of the Fund in understanding the fees
and expenses that you may pay as an investor in the Fund. THE TABLES AND
EXAMPLES DO NOT REFLECT DEDUCTIONS AT THE SEPARATE ACCOUNT LEVEL FOR ANY CHANGES
THAT MAY BE INCURRED UNDER A CONTRACT. INCLUSION OF THESE CHARGES WOULD INCREASE
THE FEES AND EXPENSES DESCRIBED BELOW.
SHAREHOLDER FEES (PAID DIRECTLY FROM YOUR INVESTMENT)
SERVICE INSTITUTIONAL
SHARES SHARES
------- -------------
(CURRENT AND PRO FORMA STRUCTURE)
Maximum Sales Charge (Load) Imposed on Purchases
(as a % of offering price)........................... None None
Redemption Fee......................................... None None
Exchange Fee........................................... None None
34
ANNUAL FUND OPERATING EXPENSES (DEDUCTED FROM FUND ASSETS)(1)
TOTAL
ANNUAL
DISTRIBUTION FUND
MANAGEMENT (12b-1) OTHER OPERATING
FEE(2) FEES(3) EXPENSES(4) EXPENSES
---------- ------------ ----------- ---------
JANUS PORTFOLIO
Service Shares
Current................ 0.64% 0.25% 0.03% 0.92%
Pro Forma.............. 0.64% 0.25% 0.03% 0.92%
Institutional Shares
Current................ 0.64% N/A 0.04% 0.68%
Pro Forma.............. 0.64% N/A 0.04% 0.68%
EXAMPLES:
THE FOLLOWING EXAMPLES ARE BASED ON EXPENSES AS SHOWN IN THE TABLES ABOVE.
These examples are intended to help you compare the cost of investing in the
Fund, under both the current fee structure and the proposed fee structure, with
the cost of investing in other mutual funds. The examples assume that you invest
$10,000 in the Fund for the time periods indicated, reinvest all dividends and
distributions, and then redeem all of your shares at the end of each period.
Since no sales load applies, the results apply whether or not you redeem your
shares at the end of the periods shown below. The examples also assume that your
investment has a 5% return each year and that the Fund's operating expenses
remain the same. The pro forma calculations assume that the Performance
Adjustment had been in effect for a 36-month period as of the end of the last
fiscal year (December 31, 2009). Although your actual costs may be higher or
lower, based on these assumptions your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
JANUS PORTFOLIO
Service Shares
Current........................ $94 $293 $509 $1,131
Pro Forma(*)................... 94 293 509 1,131
Institutional Shares
Current........................ 69 218 379 847
Pro Forma(*)................... 69 218 379 847
--------
(1) All expenses are shown without the effect of expense offset arrangements.
Pursuant to such arrangements, credits realized as a result of uninvested
cash balances are used to reduce custodian and transfer agent expenses.
(2) The "Management Fee" is the investment advisory fee rate paid by the Fund to
Janus Capital. Any Performance Adjustment included in calculating the Pro
Forma Management Fee as shown is based on the investment performance of the
Fund's Service Shares versus the Russell 1000(R) Growth Index over the 36-
month period ended December 31, 2009. Once the Performance Adjustment is
determined, it is applied across each other class of shares of the Fund.
35
(3) Because the 12b-1 fee is charged as an ongoing fee, over time the fee will
increase the cost of your investment and may cost you more than paying other
types of sales charges.
(4) "Other Expenses" include acquired fund fees and expenses. "Acquired Fund"
means any underlying fund (including, but not limited to, exchange-traded
funds) in which a Portfolio invests or has invested during the period. Total
Annual Fund Operating Expenses shown may not correlate to the Fund's "ratio
of gross expenses to average net assets" appearing in the Fund's financial
statements, which reflect the operating expenses of the Fund and does not
include Acquired Fund fees and expenses. Amounts less than 0.01%, if
applicable, are included in Other Expenses.
* The Pro Forma numbers shown include a pro forma management fee calculated as
described in the text and related footnotes that accompany the fee table
above.
2.c. OVERSEAS PORTFOLIO
HYPOTHETICAL EXAMPLE
The following hypothetical examples illustrate the application of the
Performance Adjustment for Overseas Portfolio. The examples assume that the
average daily net assets of the Fund remain constant during a 36-month
performance measurement period. The Performance Adjustment would be a smaller
percentage of current assets if the net assets of the Fund were increasing
during the performance measurement period, and a greater percentage of current
assets if the net assets of the Fund were decreasing during the performance
measurement period. All numbers in the examples are rounded to the nearest
hundredth percent. The net assets of the Fund as of the fiscal years ended
December 31, 2008 and December 31, 2009 were $1,361,309,107 and $2,326,932,204,
respectively.
The monthly maximum positive or negative Performance Adjustment of 1/12th
of 0.15% of average net assets during the prior 36 months occurs if the Fund
outperforms or underperforms its benchmark index by 7.00% over the same period.
The Performance Adjustment is made in even increments for every 0.50% difference
in the investment performance of the Fund's Service Shares compared to the
investment record of the Morgan Stanley Capital International ("MSCI") All
Country World ex-U.S. Index(SM).
EXAMPLE 1: FUND OUTPERFORMS ITS BENCHMARK BY 7.00%
If the Fund has outperformed the MSCI All Country World ex-U.S. Index(SM)
by 7.00% during the preceding 36 months, the Fund would calculate the investment
advisory fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 1/12(th) of 0.15% 1/12(th) of 0.79%
36
EXAMPLE 2: FUND PERFORMANCE TRACKS ITS BENCHMARK
If Fund performance has tracked the performance of the MSCI All Country
World ex-U.S. Index(SM) during the preceding 36 months, the Fund would calculate
the investment advisory fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 0.00% 1/12(th) of 0.64%
EXAMPLE 3: FUND PERFORMANCE UNDERPERFORMS ITS BENCHMARK BY 7.00%
If the Fund has underperformed the MSCI All Country World ex-U.S. Index(SM)
by 7.00% during the preceding 36 months, the Fund would calculate the investment
advisory fee as follows:
TOTAL ADVISORY FEE RATE
BASE FEE RATE PERFORMANCE ADJUSTMENT RATE FOR THAT MONTH
------------- --------------------------- -----------------------
1/12(th) of 0.64% 1/12(th) of -0.15% 1/12(th) of 0.49%
COMPARISON OF CURRENT AND PRO FORMA EXPENSES
The following tables describe the shareholder fees and annual fund
operating expenses that you may pay if you buy and hold shares of the Fund under
the current fee structure and proposed performance-based fee structure. No fee
waivers are in effect so all numbers are shown gross of expenses. For purposes
of pro forma calculations, it is assumed that the Performance Adjustment would
have been in effect during the entire fiscal year ended December 31, 2009, and
that it would have been calculated over a full 36-month performance measurement
period. The fees and expenses shown were determined based upon average net
assets as of the fiscal year ended December 31, 2009. For the 36-month period
ended December 31, 2009, the Fund outperformed the MSCI All Country World ex-
U.S. Index(SM) and the fiscal year-end average daily net assets were lower than
the trailing 36-month average daily net assets, resulting in the pro forma
management fee shown in the Annual Fund Operating Expenses table below.
Shareholder fees are those paid directly from your investment and may
include sales loads, redemption fees or exchange fees. The Fund is a no-load
investment, so you will generally not pay any shareholder fees when you buy or
sell shares of the Fund. However, each variable insurance contract involves fees
and expenses not described herein. See your contract prospectus for information
regarding contract fees and expenses, and any restrictions on purchases or
allocations.
Annual fund operating expenses are paid out of the Fund's assets and
include fees for portfolio management, maintenance of shareholder accounts,
shareholder servicing, accounting and other services. You do not pay these fees
directly but, as the examples show, these costs are borne indirectly by all
shareholders.
The tables and examples provided below are designed to assist participants
in qualified plans that invest in shares of the Fund in understanding the fees
and expenses
37
that you may pay as an investor in the Fund. THE TABLES AND EXAMPLES DO NOT
REFLECT DEDUCTIONS AT THE SEPARATE ACCOUNT LEVEL FOR ANY CHANGES THAT MAY BE
INCURRED UNDER A CONTRACT. INCLUSION OF THESE CHARGES WOULD INCREASE THE FEES
AND EXPENSES DESCRIBED BELOW.
SHAREHOLDER FEES (PAID DIRECTLY FROM YOUR INVESTMENT)
SERVICE SHARES SERVICE II SHARES INSTITUTIONAL SHARES
-------------- ----------------- --------------------
(CURRENT AND PRO FORMA STRUCTURE)
Maximum Sales Charge (Load)
Imposed on Purchases (as a
% of offering price)...... None None None
Redemption Fee on Shares
held for 60 days or less
(as a % of amount
redeemed)................. None 1.00%(1) None
ANNUAL FUND OPERATING EXPENSES (DEDUCTED FROM FUND ASSETS)(2)
TOTAL
ANNUAL
DISTRIBUTION FUND
MANAGEMENT (12b-1) OTHER OPERATING
FEE(3) FEES(4) EXPENSES(5) EXPENSES
---------- ------------ ----------- ---------
OVERSEAS PORTFOLIO
Service Shares
Current................ 0.64% 0.25% 0.06% 0.95%
Pro Forma.............. 0.80% 0.25% 0.06% 1.11%
Service II Shares
Current................ 0.64% 0.25% 0.06% 0.95%
Pro Forma.............. 0.80% 0.25% 0.06% 1.11%
Institutional Shares
Current................ 0.64% N/A 0.06% 0.70%
Pro Forma.............. 0.80% N/A 0.06% 0.86%
EXAMPLES:
THE FOLLOWING EXAMPLES ARE BASED ON EXPENSES AS SHOWN IN THE TABLES
ABOVE. These examples are intended to help you compare the cost of investing in
the Fund, under both the current fee structure and the proposed fee structure,
with the cost of investing in other mutual funds. The examples assume that you
invest $10,000 in the Fund for the time periods indicated, reinvest all
dividends and distributions, and then redeem all of your shares at the end of
each period. Since no sales load applies, the results apply whether or not you
redeem your shares at the end of the periods shown below. The examples also
assume that your investment has a 5% return each year and that the Fund's
operating expenses remain the same. The pro forma calculations assume that the
Performance Adjustment had been in effect for a 36-month period as of the end
38
of the last fiscal year (December 31, 2009). Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
OVERSEAS PORTFOLIO
Service Shares
Current........................ $ 97 $303 $525 $1,166
Pro Forma(*)................... 113 353 612 1,352
Service II Shares
Current........................ 97 303 525 1,166
Pro Forma(*)................... 113 353 612 1,352
Institutional Shares
Current........................ 72 224 390 871
Pro Forma(*)................... 88 274 477 1,061
--------
(1) A redemption fee of 1.00% applies to interest held in a separate account or
qualified plan for 60 days or less. The redemption fee may be waived in
certain circumstances, as described in the Shareholder's Guide in the Fund's
Prospectus.
(2) All expenses are shown without the effect of expense offset arrangements.
Pursuant to such arrangements, credits realized as a result of uninvested
cash balances are used to reduce custodian and transfer agent expenses.
(3) The "Management Fee" is the investment advisory fee rate paid by the Fund to
Janus Capital. Any Performance Adjustment included in calculating the Pro
Forma Management Fee as shown is based on the investment performance of the
Fund's Service Shares versus the MSCI All Country World ex-U.S. Index(SM)
Index over the 36-month period ended December 31, 2009. Once the Performance
Adjustment is determined, it is applied across each other class of shares of
the Fund.
(4) Because the 12b-1 fee is charged as an ongoing fee, over time the fee will
increase the cost of your investment and may cost you more than paying other
types of sales charges.
(5) "Other Expenses" include acquired fund fees and expenses. "Acquired Fund"
means any underlying fund (including, but not limited to, exchange-traded
funds) in which a Portfolio invests or has invested during the period. Total
Annual Fund Operating Expenses shown may not correlate to the Fund's "ratio
of gross expenses to average net assets" appearing in the Fund's financial
statements, which reflect the operating expenses of the Fund and does not
include Acquired Fund fees and expenses. Amounts less than 0.01%, if
applicable, are included in Other Expenses.
* The Pro Forma numbers shown include a pro forma management fee calculated as
described in the text and related footnotes that accompany the fee table
above.
REQUIRED VOTE
Approval of each Proposed Amended Advisory Agreement requires the
affirmative vote of a 1940 Act Majority of the Fund, with all classes of shares voting together as a single class. For purposes of determining the approval of the Manager of Managers Proposal, abstentions and broker non-votes will have the same effect as shares voted against the proposal. An unfavorable vote on the Manager of Managers Proposal by the shareholders of one Fund will not affect the implementation of the Manager of Managers Proposal by another Fund if the Manager of Manager Proposal is approved by the shareholders of that Fund. Shareholder approval of the Manager of Managers Proposal is not being sought with respect to which it applies. Global Unconstrained Bond Portfolio, as such Fund has already implemented the manager of managers structure at their inception. If shareholders of a Fund do not approve the proposal applicable to their Fund,Manager of Managers Proposal, the Current Advisory Agreement for that Fund will remain in effect and the Board of
TrusteesProposal will take such further action as it deems to be ineffect whether or not the best interest of
the Fund and its shareholders.
39
THE INDEPENDENT TRUSTEES OF THE TRUST UNANIMOUSLY RECOMMEND THAT YOU VOTE "FOR"
APPROVAL OF THE PROPOSED AMENDED ADVISORY AGREEMENT FOR YOUR FUND.
FUND SERVICE PROVIDERS
ADMINISTRATOR. Janus Capital serves as administrator to the Funds,
performing internal accounting, recordkeeping, blue sky monitoring and
registration functions of the Funds. Janus Capital may be reimbursed by the
Funds for certain administrative and clerical functions it provides to the
Funds, as well as for reasonable costs it incurs in performing certain
functions. Janus Capital intends to continue to provide the same administrative
services after implementation of the proposed amended advisory agreements
(discussed in Proposal 2).
DISTRIBUTOR. Janus Distributors, a wholly-owned subsidiary of Janus
Capital, located at 151 Detroit Street, Denver, Colorado 80206, serves as
distributor of the Funds pursuant to an Amended and Restated Distribution
Agreement between the Trust and Janus Distributors. According to plans adopted
pursuant to Rule 12b-1 under the 1940 Act for Service Shares and Service II
Shares, Janus Distributors receives a 12b-1 distribution fee from Service Shares
and Service II Shares at the annual rate of up to 0.25% of the average daily net
assets of such shares in each Fund, as applicable. Janus Distributors uses the
payments to pay insurance companies and qualified service providers for
distribution and/or administrative services provided by such service providers.
Janus Distributors may retain some or all of the fee it receives from each class
of shares or may pass it through to financial intermediaries in payment for
distribution and/or administrative services. Janus Distributors intends to
continue to provide the same services after implementation of the proposed
amended advisory agreements (discussed in Proposal 2).
Fees paid by Service Shares and Service II SharesTransaction is consummated. The Board unanimously recommends that shareholders of each Fund offering
such shares for the fiscal year ended December 31, 2009 are shown in the table
below.
FEES PAID TO JANUS DISTRIBUTORS FOR
FISCAL YEAR ENDED DECEMBER 31, 2009
------------------------------------
SERVICE SHARES SERVICE II SHARES
FUND ($) (000'S) ($) (000'S)
---- -------------- -----------------
Balanced Portfolio..................... 1,357 N/A
Enterprise Portfolio................... 752 N/A
Flexible Bond Portfolio................ 71 N/A
Forty Portfolio........................ 1,633 N/A
Global Life Sciences Portfolio......... 50 N/A
Global Technology Portfolio............ 254 48
Growth and Income Portfolio............ 72 N/A
Janus Portfolio........................ 3,128 N/A
Mid Cap Value Portfolio................ 146 N/A
Research Core Portfolio................ 5 N/A
Risk-Managed Core Portfolio............ 71 N/A
Overseas Portfolio..................... 3128 911
Worldwide Portfolio.................... 399 -N/A
40
TRANSFER AGENT. Janus Services, P.O. Box 173375, Denver, Colorado 80207-
3375, a wholly-owned subsidiary of Janus Capital, serves as each Fund's transfer
agent pursuant to an Amended and Restated Transfer Agency Agreement ("Transfer
Agency Agreement") between Janus Services and the Trust. Janus Services provides
certain other administrative, recordkeeping, and shareholder relations services
for the Funds. Janus Services is not compensated for its services related to the
Funds, except for out-of-pocket costs. Pursuant to the Transfer Agency
Agreement, each class of each Fund reimburses Janus Services for out-of-pocket
expenses incurred by Janus Services in connection with services rendered. Janus
Services may receive from Risk-Managed Core Portfolio and Mid Cap Value
Portfolio a fee at an annual rate of up to 0.10%vote FOR approval of the average daily net assetsManager of the Service Shares of each of these Portfolios, to compensate Janus Services
for providing, or arranging for the provision of record keeping, subaccounting,
and administrative services to retirement or pension plan participants, variable
contract owners, or other underlying investors investing through institutional
channels. Janus Services intends to continue to provide the same services after
implementation of the Proposed Amended Advisory Agreements (discussed in
Proposal 2).
For the fiscal year ended December 31, 2009, the total administrative
services fee amounts paid by Service Shares of the Portfolios to Janus Services
are summarized below:
FEES PAID TO JANUS SERVICES
FOR FISCAL YEAR ENDED
DECEMBER 31, 2009
FUND NAME ($) (000'S)
--------- ---------------------------
Risk-Managed Core Portfolio Service Shares.. 29
Mid Cap Value Portfolio Service Shares...... 58
Manager’s Proposal.37
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Based on the Audit Committee'sCommittee’s recommendation, the Board of Trustees, all of whom are Independent Trustees, selected PricewaterhouseCoopers LLP ("PWC"(“PwC”) as the Trust'sTrust’s independent registered public accounting firm during the Trust'sTrust’s current fiscal year. In accordance with Independence Standards Board Standard No. 1 ("(“ISB No. 1"1”), PWCPwC has confirmed to the Trust'sTrust’s Audit Committee that it is an independent registered accounting firm with respect to the Funds. Representatives of PWCPwC will be available at the Meeting to answer appropriate questions concerning the Trust'sTrust’s financial statements and will have an opportunity to make a statement if they so choose.
As the independent registered public accounting firm Audit Fees. The aggregate fees billed for the Trust, PWC
performs auditprofessional services rendered by PwC for the Trust, including the audit of the Trust's annual financial statements reviews of the Trust's annual reports, semiannual reports,
quarterly portfolio holdings reports and registration statement amendments. PWC
may also provide other audit-related, non-audit and tax-relatedor services to the
Funds.
The Trust's Audit Committee must pre-approve all audit and non-audit
servicesthat are normally provided by PWC to the Funds. The Trust's Audit Committee has adopted
policiesPwC in connection with statutory and procedures to, among other purposes, provide a frameworkregulatory filings or engagements for the Audit Committee's
41
consideration of any non-audit services provided by PWC. The policiesfiscal years ending in 2016 and procedures require that any audit2015 for each Fund and non-audit services provided to the Funds
by PWC and any non-audit service provided by PWC to Janus Capital andor entities controlling, controlled by, or under common control with Janus Capital that provide ongoing services to the Funds (collectively, "Fund“Fund Service Providers"Providers”)
that relate directly to the operations and financial reporting of a Fund
("Covered Services"), are subject to approval by the Audit Committee before such
service is provided. The Chairman of the Audit Committee (or, in his absence,
any Audit Committee member) is authorized to grant such pre-approvallisted in the interim between regularly scheduled meetings of the Audit Committee. In such
case, the Chairman must report the pre-approvaltables set forth inAppendix I to the Audit Committee no later
than its next meeting.
Pre-approval of non-audit services provided by PWC to the Trust and Fund
Service Providers is not required if: (i) the services were not recognized by
Janus Capital at the time of the engagement as non-audit services; (ii) for non-
audit services provided to the Trust, thethis Proxy Statement. Audit-Related Fees. The aggregate fees paid for all such non-
audit services provided to the Trust are no more than 5% of the total fees paid
by the Trust to the independent auditor during the fiscal year in which the non-
audit services are provided; (iii) for non-audit services provided to Fund
Service Providers, the aggregate fees for all such non-audit services provided
are no more than 5% of the total fees paid by the Trust and Fund Service
Provides during the fiscal year of the Trust in which the non-audit services are
provided; and (iv) such services are promptly brought to the attention of the
Audit Committee by Janus Capital, and the Audit Committee or its delegate
approves them prior to the completion of the audit (the "de minimis exception").
In circumstances where the Trust's Audit Committee did not pre-approve
certain non-audit services that were rendered by PWC to any Fund Service
Provider that did not relate directly to the operations and financial reporting
of a Janus fund ("Non-Covered Service"), the Trust's Audit Committee will
consider whether the provision of the such non-audit service by PWC is
compatible with maintaining PWC's independence in auditing the Funds, taking
into account representations from PWC, in accordance with ISB No. 1, regarding
its independence from the Funds and their related entities. There were no non-
audit services provided to a Fund Service Provider by PWC that were not pre-
approved by the Audit Committee.
Audit Fees. In each of the fiscal years ended December 31, 2009 and
December 31, 2008, the aggregate Audit Fees billed by PWC for professional
services rendered for the audits of the financial statements of each Fund, or
services that are normally provided by PWC in connection with statutory and
regulatory filings or engagements for those fiscal years for the Trust, are
shown in the table below.
2009(A) 2008(A)
------- --------
$363,463
--------
(A) Aggregate amounts may reflect rounding.
Audit-Related Fees. In each of the fiscal years ended December 31, 2009
and December 31, 2008, there were no Audit-Related Fees billed by PWC for
services
42
rendered for assurance and related services to each Fundby PwC that are reasonably related to the performance of the audit or review of the Funds' financial statements butand are not reported as Audit Fees.
In each ofunder “Audit Fees” above for the fiscal years ended December 31, 2009ending in 2016 and December 31, 2008,
the aggregate Audit-Related Fees that were billed by PWC that were required to
be approved by the Audit Committee2015 for services rendered on behalf ofeach Fund and the Fund Service Providers for assurance and related services that relate directlyare listed in the tables set forth inAppendix I to the
operationsthis Proxy Statement. The nature of the Audit orservices comprising the fees disclosed under this category includes the review of the Funds' financial statements, but not
reported as Audit Fees, are shown in the table below.
2009(A) 2008(A)
------- --------
$339,818
--------
(A) Aggregate amounts may reflect rounding.
Fees included in the audit-related category consist of assurance and
related services (e.g., due diligence services) that are traditionally performed
by the independent registered public accounting firm. These audit-related
services include due diligence relatedsemiannual reports to mergers and acquisitions and
semiannual financial statement disclosure review.
No amounts were approved by the Audit Committee pursuant to the de minimis
exception for the fiscal years ended December 31, 2009 and December 31, 2008 for
the Trust. There were no amounts that were required to be approved by the Audit
Committee pursuant to the de minimis exception for the fiscal years ended
December 31, 2009 and December 31, 2008 for the Trust, on behalf of the Fund
Service Providers, that relate directly to the operations and financial
reporting of each Fund.
Tax Fees. In each of the fiscal years ended December 31, 2009 and December
31, 2008, the aggregate shareholders.Tax Fees. The aggregate fees billed by PWC for professional services rendered for tax compliance, tax advice, corporate actions review, and tax
planning for the Funds are shown in the table below.
2009(A) 2008(A)
------- -------
$81,875
--------
(A) Aggregate amounts may reflect rounding.
In each of the fiscal years ended December 31, 2009 and December 31, 2008,
the aggregate Tax Fees billed by PWC that were required to be approved by the
Audit Committee for professional services rendered on behalf of the Fund Service
ProvidersPwC for tax compliance, tax advice, and tax planning that relatefor the fiscal years ending in 2016 and 2015 for each Fund and the Fund Service Providers are listed in the tables set forth inAppendix I to this Proxy Statement. The nature of the services comprising the fees disclosed under this category includes tax compliance, tax planning, tax advice, and corporate actions review.All Other Fees. The aggregate fees billed for products and services provided by PwC, other than the services reported in “Audit Fees,” “Audit-Related Fees,” and “Tax Fees” above, for the fiscal years ending in 2016 and 2015 for each Fund and the Fund Service Providers are listed in the tables set forth inAppendix I to this Proxy Statement. Pre-Approval of Certain Services. The Trust’s Audit Committee Charter requires the Audit Committee to pre-approve any engagement of PwC (i) to provide audit or non-audit services to the Trust or (ii) to provide non-audit services to the Fund Service Providers, if the engagement relates directly to the operations and financial reporting of the Funds are shown in the table
below.
2009(A) 2008(A)
------- -------
$0
--------
(A) Aggregate amounts may reflect rounding.
43
Fees included in the Tax Fees category consist of allTrust, except for those non-audit services performed by
professional staff of PWC's tax division, except those services relatedthat were subject to the audit. Typically, this category includes feespre-approval exception under Rule 2-01 of Regulation S-X (the “Pre-Approval Exception”). The Chair of the Audit Committee or, if the Chair is unavailable, another member of the Audit Committee who is an Independent Trustee, may grant the pre-approval. All such delegated pre-approvals must be presented to the Audit Committee no later than the next Audit Committee meeting.None of the services rendered by PwC to the Funds or to Janus Capital (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) or any Fund Service Providers for tax compliance, tax planning,the fiscal years ending in 2016 and tax advice. Tax fees include amounts for tax advice related to mergers and
acquisitions and requests for ruling or technical advice from taxing
authorities.
No amounts2015 were approvedpre-approved by the Audit Committee pursuant to the de minimis
exceptionPre-Approval Exception. Non-Audit Fees. The aggregate non-audit fees billed by PwC for services rendered to the Trust, and rendered to Janus Capital (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any Fund Service Providers for the fiscal years ended December 31, 2009ending in 2016 and December 31, 2008 for2015 are listed in the Trust. There were no amountstables set forth inAppendix I to this Proxy Statement. The Audit Committee has considered whether the provision of non-audit services that were requiredrendered to be approvedJanus Capital (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by the Audit
Committee pursuant to the de minimis exception for the fiscal years ended
December 31, 2009another investment adviser), and December 31, 2008 for the Trust, on behalf of the Fund Service Providers that relate directly to the operations and financial
reporting of each Fund.
All Other Fees. In each of the fiscal years ended December 31, 2009 and
December 31, 2008, there were no Other Fees billed by PWC for other non-audit
services rendered to the Funds.
In each of the fiscal years ended December 31, 2009 and December 31, 2008,
there were no Other Fees billed by PWC that were required to be approved by the
Audit Committee for other non-audit services rendered on behalf of the Fund
Service Providers that relate directly to the operations and financial reporting
of the Funds.
No amounts were approved by the Audit Committeenot pre-approved pursuant to the de minimis
exceptions for the fiscal years ended December 31, 2009 and December 31, 2008
for the Trust. There were no amounts that were required to be approved by the
Audit Committee pursuant to the de minimis exception for the fiscal years ended
December 31, 2009 and December 31, 2008 for the Trust, on behalfparagraph (c)(7)(ii) of the Fund
Service Providers that relate directly to the operations and financial reportingRule 2-01 of each Fund.
For the fiscal years ended December 31, 2009 and December 31, 2008 for the
Trust, the aggregate fees billed by PWC of $ and $0, respectively, for non-
audit services rendered on behalf of the Funds, Janus Capital and Fund Service
Providers relating to Covered and Non-Covered Services are shown in the table
below.
2009(A) 2008(A)
--------------------- ----------------------
COVERED NON-COVERED COVERED NON-COVERED
SERVICES SERVICES SERVICES SERVICES
-------- ----------- -------- -----------
$0 $0
--------
(A) Aggregate amounts may reflect rounding.
Regulation S-X is compatible with maintaining PwC’s independence.38
ADDITIONAL INFORMATION ABOUT THE MEETING
QUORUM AND VOTING
Quorum and Voting Shareholders are entitled to one vote for each whole dollar and a proportionate fractional vote for each fractional dollar of net asset value of shares held in such shareholder'sshareholder’s name as of the Record Date. If you are not the owner of record, but are a beneficial owner as a participant in a qualified plan or a contract owner of a variable 44
insurance contract, your qualified plan or insurance companyParticipating Insurance Company may request that you provide instruction on how to vote the shares you beneficially own. It is important to note that qualified plans and Participating Insurance Companies generally vote all shares proportionately in accordance with the instructions they have received. In addition, qualified plans and Participating Insurance Companies generally do not require voting instructions from a minimum number of beneficially owned shares in order to vote the shares held and, as a result, a relatively small number of participants in qualified plans or contract owners can determine the manner in which a qualified plan or a Participating Insurance Company votes. Your qualified plan or insurance company willParticipating Insurance Company can provide you with additional information. One-third of the outstanding shares entitled to vote at the Meeting with respect to each Fund or the Trust, as applicable, shall be a quorum for the transaction of business by that Fund at the Meeting. Any lesser number is sufficient for adjournments. Quorum with respect to each proposal is described in greater detail below. In the event that the necessary quorum to transact business or the vote required to approve a proposal is not obtained at the Meeting with respect to one or more Funds,each Fund, the persons named as proxies may propose one or more adjournments or postponements of the Meeting, in accordance with applicable law, to permit further solicitation of proxies with respect to thatthe proposal. Any such adjournment or postponement as to athe proposal will require the affirmative vote of the holders of a majority of the shares of the applicable Fund, present in person or by proxy at the Meeting. If a quorum is not present, the persons named as proxies will vote those proxies for the Fund (excluding broker non-votes and abstentions) in favor of such adjournment or postponement if they determine additional solicitation is warranted and in the interest of shareholders of the Fund.
"Broker non-votes" “Broker non-votes” are shares held by a broker or nominee for which an executed proxy is received by a Fund, but are not voted because instructions have not been received from beneficial owners or persons entitled to vote, and the broker or nominee does not have discretionary voting power. AbstentionsFor purposes of voting on a proposal, abstentions and "broker non-votes" are“broker non-votes” will be counted as shares eligible to vote at the Meeting inpresent for purposes of determining whether a quorum is present, but do not represent votes cast with
respect toin favor of an adjournment, postponement, or a proposal. For purposes of voting on a proposal,
abstentions and "broker non-votes" will not be counted in favor of, but will
have no other effect on Proposal 1, for which the required vote is a plurality
(the greatest number) of votes cast. For Proposals 2.a., 2.b. and 2.c, and
assuming the presence of a quorum, abstentions and "broker non-votes" will have
the effect of a vote against the Proposal. Therefore, if your shares are held through a broker or other nominee, it is important for you to instruct the broker or nominee how to vote your shares.
PROPOSAL Certain funds in the Janus fund complex are considered “fund of funds” and invest their assets in the Janus funds. Such funds of funds will vote any shares of the Funds for and against any matter in the same proportion as the votes of other shareholders of the underlying funds. Proposal 1: ELECTION OF TRUSTEESApproval of New Investment Advisory Agreement. Shareholders of each Fund will vote together.separately on Proposal 1. To become effective with respect to a Fund, the New Advisory Agreements require the affirmative vote of a 1940 Act Majority of the applicable Fund, with all classes of shares voting together as a single class. A 1940 Act Majority means the lesser of the vote of (i) 67% or more of the shares of the Fund entitled to vote thereon present at the meeting if the holders of more than 50% of such outstanding shares are present in person or represented by proxy; or (ii) more than 50% of such outstanding shares of the Fund entitled to vote thereon. The shares of each Fund will be counted using dollar-based voting. This means that each share of a Fund will represent a number of votes equal to that share’s net asset value on the record date. For purposes of determining the approval of the New Advisory Agreements, abstentions and broker non-votes will have the same effect as shares voted against the proposal. An unfavorable vote on the proposal to approve the New Advisory Agreement by the shareholders of one Fund will not affect the implementation of the proposal by another Fund if the proposal is approved by the shareholders of that Fund. However, the proposal will only take effect upon the closing of the Transaction, which is conditioned upon obtaining the approval of new investment advisory agreements by shareholders of Janus funds representing a specified percentage of assets under management. 39
Proposal 2: Approval of New Investment Sub-Advisory Agreement with Current Sub-Adviser. Shareholders of the INTECH Fund and the Perkins Fund will vote separately on Proposal 2. To become effective with respect to a Fund, the New Sub-Advisory Agreement must be approved by a 1940 Act Majority of the applicable Fund, with all classes of shares voting together as a single class. The shares of each Fund will be counted using dollar-based voting. This means that each share of a Fund will represent the number of votes equal to that share’s net asset value on the record date. For purposes of determining the approval of each New Sub-Advisory Agreement, abstentions and broker non-votes will have the same effect as shares voted against the proposal. An unfavorable vote on the proposal to approve the New Sub-Advisory Agreement by the shareholders of one Fund will not affect the implementation of the proposal by another Fund if the proposal is approved by the shareholders of that Fund. However, the proposal will only take effect upon the closing of the Transaction, which is conditioned upon obtaining the approval of new investment advisory agreements by shareholders of Janus funds representing a specified percentage of assets under management. Proposal 3: Approval of Janus Portfolio’s Amended Advisory Agreement. Shareholders of Janus Portfolio will vote separately on Proposal 3. To become effective with respect to Janus Portfolio, the Amended Advisory Agreement must be approved by a 1940 Act Majority of the Fund, with all classes of shares voting together as a single class. The shares of the Fund will be counted using dollar-based voting. This means that each share of the Fund will represent the number of votes equal to that share’s net asset value on the Record Date. For purposes of determining the approval of Janus Portfolio’s Amended Advisory Agreement, abstentions and broker non-votes will have the same effect as shares voted against the proposal. Proposal 4: Trustee Election. Election of an additional Trustee will be determined by the affirmative vote of a plurality (the greatest number of affirmative votes) of the shares with respect to each fund in the Trust. All series of the Trust, including Global Allocation Portfolio – Moderate, for which votes are being solicited with respect to the election of the Trustee Nominee pursuant to a separate proxy statement. The presence in person or by proxy of the holders of record of one-third of the Funds' aggregate total shares outstanding and entitled to vote of all funds in the Trust constitutes a quorum at the Meeting with respect to this Proposal.
PROPOSAL 2: APPROVAL OF AMENDED INVESTMENT ADVISORY AGREEMENTSProposal 4 with all classes of shares of the fund voting together as a single class. Proposal 5: Approval of Manager of Managers Proposal. Shareholders of Forty Portfolio, Janus Portfolio and Overseas Portfolioeach Fund (except for Global Unconstrained Bond Portfolio) will vote separately on Proposal 2 (all classes of a Fund voting together). The
presence in person or by proxy of the holders of record of one-third of each
applicable Fund's shares outstanding and entitled to vote at the Meeting
constitutes a quorum5. To become effective with respect to this Proposal. Approvala Fund, the Manager of theManagers Proposal will require the affirmative vote ofmust be approved by a 1940 Act Majority of the Fund, with all classes of shares voting together as a Fund'ssingle class. The shares of each Fund will be counted using dollar-based voting. This means that each share of a Fund will represent the number of votes equal to that share’s net asset value on the record date. For purposes of determining the approval of the Manager of Managers Proposal, abstentions and broker non-votes will have the same effect as shares voted against the proposal. An unfavorable vote on the Manager of Managers Proposal by the shareholders eligible to vote atof one Fund will not affect the Meeting.
45
SHARE OWNERSHIP
implementation of the Manager of Managers Proposal by another Fund if the Manager of Manager Proposal is approved by the shareholders of that Fund. Fund Share Ownership The number of outstanding shares and net assets of each class of each Fund, as applicable, as of the close of business on the Record Date, is included inAppendix FA to this Proxy Statement
Statement. Shares of each Fund are offered for purchase through an insurance contract of a Participating Insurance Company or through a qualified plan. As of [ , 2009],December 29, 2016, unless otherwise noted, all of the outstanding shares of each Fund were owned by certain insurance company separate accounts and qualified plans. The percentage ownership of each separate account or qualified plan owning 5% or more of the outstanding shares of each class of each Fund as of the Record Date is provided inAppendix G. To the best knowledge of the Trust, as of [ , 2009] no
person beneficially owned more than 5% of the outstanding shares of any class of
a Fund except as stated in Appendix G.K to this Proxy Statement. To the best knowledge of the Trust, entities shown as owning 25% or more of a Fund, unless otherwise indicated, are not the beneficial owners of such shares. None 40
Solicitation of Proxies Janus will pay the fees and expenses related to each proposal, including the cost of the qualified plans owned 10%
or morepreparation of the shares of the Trust as a whole.
As of the Record Date, the officersthese proxy materials and Trustees as a group owned less than
1% of the outstanding shares of each Fund.
SOLICITATION OF PROXIES
The cost of preparing, printing, and mailing the proxy card(s) and this
Proxy Statement,their distribution, and all other costs incurred with the solicitation of proxies, the Meeting, including any additional solicitation made by letter, telephone, or otherwise,
will be allocated between Janus Capital and the Funds. Janus Capital will pay
the costs associated with engagement of the solicitor and solicitation of
proxies for the election of Trustees. Solicitation of proxies related to
Proposal 2 will be borne by those Funds voting on that Proposal, pursuant to a
methodology agreed upon by the Trustees and Janus Capital. otherwise. In addition to solicitation of proxies by mail, certain officers and representatives of the Trust, certain officers and employees of Janus Capitalthe Adviser or its affiliates, and certain financial services firms and their representatives, without extra compensation, or a solicitor, may conduct additional solicitations personally, by telephone, U.S. mail, verbal, internet, email, or by any other means available. Janus Capital has engaged [ ],Computershare, a professional proxy solicitation firm, to assist in the solicitation of proxies for the Funds, at an estimated cost of [$ ],$740,000 plus [any out-of-pocket]any out-of-pocket expenses. Among other things, [ ]Computershare will be: (i) required to maintain the confidentiality of all shareholder information; (ii) prohibited from selling or otherwise disclosing shareholder information to any third party; and (iii) required to comply with applicable telemarketing laws. Insurance companies and qualified plans may be required to forward soliciting material to the beneficial owners of shares of a Fund and to obtain authorization for the execution of proxies. For those services, they will be
reimbursed by [Janus Capital or the Funds] for their expenses, toTo the extent that [Janus CapitalJanus or the Fundsa Fund would have directly borne the expenses for those services, Janus will reimburse those intermediaries for their expenses.]
46
The Board has determined that the use of this Proxy Statement is in the best interest of each Fund in light of the similar proposals being considered and voted on by the shareholders of each Fund. Certain other Janus funds, not listed in this Proxy Statement, will also hold meetings of shareholders with similar proposals. If you were also a shareholder of record of one or more of those other funds on the record date established for the meetings of shareholders of such other funds, you will receive a separate proxy statement and proxy card(s) relating to those funds. As the Meeting date approaches, certain shareholders whose votes have not been received may receive telephone calls from a representative of [ ].Computershare. Authorization to permit [ ]Computershare to execute proxies may be obtained by telephonic or electronically transmitted instructions from shareholders of each Fund. Proxies that are obtained telephonically will be recorded in accordance with the procedures described below. The Funds believeJanus believes that these procedures are reasonably designed to ensure that both the identity of the shareholder casting the vote and the voting instructions of the shareholder are accurately determined. In all cases where a telephonic proxy is solicited, the [ ]Computershare representative is required to ask for certain identifying information from each shareholder's full name, address and
title (ifshareholder. Then the representative will ask the shareholder is authorized to act on behalf of an entity, such as a
corporation), and to confirm that the shareholder has received the Proxy
Statement or notice of proxy and proxy card(s) in the mail or electronically. If
the information solicited agrees with the information provided to the
representative, then the representative has the responsibility to explain the
process, read the proposal(s) listed on the proxy card,vote their shares by telephone, and ask for the shareholder'sshareholder’s instructions on the proposal(s). Although the representative is permitted to answer questions about the process, he or she is not permitted to recommend to the shareholder how to vote. The representative may read any
recommendationthe recommendations set forth in this Proxy Statement. The representative will record the shareholder'sshareholder’s instructions. Within 72 hours, the shareholder will be sent a confirmation of his or her vote asking the shareholder to call [ ]866-492-0863 immediately if his or her instructions are not accurately reflected in the confirmation. Telephone Touch-Tone Voting.Voting. Shareholders may provide their voting instructions through telephone touch-tone voting by following the instructions on the proxy card(s). Shareholders will have an opportunity to review their voting instructions and make any necessary changes before submitting their voting instructions and terminating their telephone call. Internet Voting.Voting. Shareholders may provide their voting instructions through Internet voting by following the instructions on the proxy card(s). Shareholders who vote via the Internet, in addition to confirming their voting instructions prior to submission and terminating their Internet session, will, upon request, receive an e-mail confirming their voting instructions. If a shareholder wishes to participate in the Meeting but does not wish to give a proxy by telephone or via the Internet, the shareholder may still submit the proxy card(s) originally sent with the Proxy Statement in the postage-paid envelope provided or otherwise mailed or provided to the shareholder, or attend the Meeting in person. Shareholders requiring additional information regarding the proxy or replacement proxy card(s) may contact [ ]Computershare at [1-
].866-492-0863. Any proxy given by a shareholder is revocable until voted at the Meeting. 41
Revoking a Proxy.Proxy. Any shareholder submitting a proxy has the power to revoke it at any time before it is exercised at the Meeting by submitting to the Secretary of the Trust at 151 Detroit Street, Denver, Colorado 80206, a written notice of revocation or a 47
subsequently executed proxy or voting instruction, or by attending the Meeting and voting in person. All properly executed and unrevoked proxies received in time for the Meeting will be voted as specified in the proxy or, if no specification is made, will be voted "FOR"“FOR” the proposal(s), as described in this Proxy Statement. Attending the Meeting. Shareholders who wish to attend the Meeting and vote in person will be able to do so. If you intend to attend the Meeting in person and you are a record holder of a Fund’s shares, in order to gain admission you may be asked to show photographic identification, such as your driver’s license. If you intend to attend the Meeting in person and you hold your shares through a broker, bank or other intermediary, in order to gain admission you may be asked to show photographic identification, such as your driver’s license, and satisfactory proof of ownership of shares of a Fund, such as your voting instruction form (or a copy thereof) or broker’s statement indicating ownership as of a recent date. If you hold your shares in a brokerage account or through a bank or other intermediary you will not be able to vote in person at the Meeting unless you have previously requested and obtained a “legal proxy” from your broker, bank or other intermediary and present it at the Meeting. Shareholders may contact the Computershare at 866-492-0863 to obtain directions to the site of the Meeting. Shares Held by Accounts of Participating Insurance Companies.Companies. Shares of the Funds may be held by certain separate accounts of insurance companiesParticipating Insurance Companies to fund benefits payable under certain variable annuity contracts and variable life insurance policies. Your insurance companyEach Participating Insurance Company may request that you provideoffer to contract owners the opportunity to instruct it with voting
instructions for your beneficially heldhow to vote shares on the proposals presented at the Meeting. Each contract owner of any such separate account.record at the close of business on the Record Date may have the right to instruct a Participating Insurance Company as to the manner in which shares attributable to their contract should be voted. If you doa contract owner does not provide voting instructions to your insurance company,a Participating Insurance Company, it may vote all of the shares held in that separate account in the same proportions as the votinginstructions actually received from its other variable contract holders for that separate account.
PORTFOLIO TRANSACTIONS
All orders Shareholder Proposals for the purchase or sale of a Fund's portfolio securities are
placed on behalf of the Fund by Janus Capital or its agent. INTECH Investment
Management LLC, subadviser to Janus Aspen INTECH Risk-Managed Core Portfolio,
has authority to place trades on behalf of that Fund. With respect to Janus
Aspen Perkins Mid Cap Value Portfolio, Janus Capital places portfolio
transactions solely upon the direction of that Fund's subadviser, Perkins
Investment Management LLC. The Funds do not allocate portfolio transactions to
broker-dealers on the basis of the sale of Fund shares, although brokerage firms
whose customers purchase shares of a Fund may execute transactions for the Fund
and receive brokerage commissions.
During the most recent fiscal year, no Fund paid any commissions to a
broker-dealer affiliated with Janus Capital.
LEGAL MATTERS
Information regarding material pending legal proceedings involving Janus
Capital or the Trust is attached as Appendix H to this Proxy Statement.
SHAREHOLDER PROPOSALS FOR SUBSEQUENT MEETINGS
Subsequent Meetings The Funds are not required, and do not intend, to hold annual shareholder meetings. Under the terms of a settlement reached between Janus Capital and the
SEC in August 2004, commencing in 2005 and not less than every fifth calendar
year thereafter, the Trust are obligated to hold a meeting of shareholders to
elect Trustees. Shareholder meetings may be called from time to time as described in the Amended and Restated Trust Instrument and the Bylaws of the Trust.
Trust, as amended. Under the proxy rules of the SEC, shareholder proposals that meet certain conditions may be included in a Fund'sFund’s proxy statement for a particular meeting. Those rules currently require that for future meetings, the shareholder must be a record or beneficial owner of Fund shares either (i) with a value of at least $2,000 or (ii) in an amount representing at least 1% of the Fund'sFund’s securities to be voted at the time the
48
proposal is submitted and for one year prior thereto, and must continue to own such shares through the date on which the meeting is held. Another requirement relates to the timely receipt by a Fund of any such proposal. Under those rules, a proposal must have been submitted within a reasonable time before the Fund began to print and mail this Proxy Statement in order to be included in this Proxy Statement. A proposal submitted for inclusion in a Fund'sFund’s proxy material for the next special meeting after the meeting to which this Proxy Statement relates must be received by the Fund within a reasonable time before the Fund begins to print and mail the proxy materials for that meeting. A shareholder wishing to submit a proposal for inclusion in a proxy statement subsequent to the Meeting, if any, should send the written proposal to the Secretary of the Trust at 151 Detroit Street, Denver, Colorado 80206, within a reasonable time before a Fund begins to print and mail the proxy materials for that meeting. Notice of shareholder proposals to be presented at the Meeting must have been received within a reasonable time before the Funds began to mail this Proxy Statement. The timely submission of a proposal does not guarantee its inclusion in the proxy materials.
SHAREHOLDER COMMUNICATIONS
42
Shareholder Communications The Trustees provide for shareholders to send written communications to the Trustees via regular mail. Written communications to the Trustees, or to an individual Trustee, should be sent to the attention of the Trust'sTrust’s Secretary at the address of the Trust'sTrust’s principal executive office. All such communications received by the Trust'sTrust’s Secretary shall be promptly forwarded to the individual Trustee to whom they are addressed or to the full Board of Trustees, as applicable. If a communication does not indicate a specific Trustee, it will be sent to the Chairperson of the Nominating and Governance Committee and the independent counsel to the Trustees for further distribution, as deemed appropriate by such persons. The Trustees may further develop and refine this process as deemed necessary or desirable.
REPORTS TO SHAREHOLDERS AND FINANCIAL STATEMENTS
Reports to Shareholders and Financial Statements The annual report to shareholders of the Funds, including financial statements of each Fund, has previously been sent to shareholders. THE FUNDS
PROVIDE ANNUAL AND SEMIANNUAL REPORTS TO ITS SHAREHOLDERS THAT HIGHLIGHT
RELEVANT INFORMATION, INCLUDING INVESTMENT RESULTS AND A REVIEW OF PORTFOLIO
CHANGES. ADDITIONAL COPIES OF THE FUNDS' MOST RECENT ANNUAL REPORT AND ANY MORE
RECENT SEMIANNUAL REPORT ARE AVAILABLE, WITHOUT CHARGE, BY CALLING A JANUS
REPRESENTATIVE AT [1-877-335-2687], VIA THE INTERNET AT [JANUS.COM/INFO], OR BY
SENDING A WRITTEN REQUEST TO THE SECRETARY OF THE TRUST ATThe Funds provide annual and semiannual reports to their shareholders that highlight relevant information, including investment results and a review of portfolio changes. Additional copies of the Funds’ most recent annual report and any more recent semiannual report are available, without charge, by calling a Janus representative at 1-877-335-2687, via the Internet at janus.com/variable-insurance, or by sending a written request to the Secretary of the Trust at 151 DETROIT STREET,
DENVER, COLORADODetroit Street, Denver, Colorado 80206.
OTHER MATTERS TO COME BEFORE THE MEETING
Other Matters to Come Before the Meeting The Board of Trustees is not aware of any matters that will be presented for action at the Meeting other than the matters described in this Proxy Statement. Should any other mattersmatter requiring a vote of shareholders arise, the proxy in the accompanying form will confer upon the person or persons entitled to vote the shares represented by such 49
proxy the discretionary authority to vote the shares as to any other matters, in accordance with their best judgment in the interest of the Trust and/or Funds.
PLEASE COMPLETE, SIGN, AND RETURN THE ENCLOSED PROXY CARD(S) OR VOTE BY
INTERNET OR TELEPHONE PROMPTLY. NO POSTAGE IS REQUIRED IF YOU MAIL YOUR PROXY
CARD(S) IN THE UNITED STATES.
By order Please vote by Internet or telephone promptly, or complete, sign and return the enclosed proxy card(s). No postage is required if you mail your proxy card(s) in the United States. | By Order of the Board of Trustees, | | /s/ Bruce L. Koepfgen | Bruce L. Koepfgen | President and Chief Executive Officer of | Janus Aspen Series |
43
APPENDIX LIST | | Appendix A – Shares Outstanding and Net Assets | | Appendix B – Dates Relating to Current Advisory Agreements | | Appendix C – Advisory Fee Rates | | Appendix D – Comparable Funds | | Appendix E – Information Regarding Officers and Directors of Adviser and Sub-Advisers | | Appendix F – Fees Paid | | Appendix G – Compensation of Trustees | | Appendix H – Principal Officers of the Trust and Their Principal Occupations | | Appendix I – Audit and Related fees | | Appendix J – Nominating and Governance Committee Charter | | Appendix K – Principal Holders | | Appendix L – Form of New Advisory Agreement | | Appendix M – Form of New INTECH Sub-Advisory Agreement | | Appendix N – Form of New Perkins Sub-Advisory Agreement |
44
Appendix A Shares Outstanding and Net Assets The following charts show the shares outstanding and net assets of each class of each Fund as of December 29, 2016. | | | | | | | | | | Fund | | Share Class | | Total Number of Outstanding Shares | | Net Assets | | | | | | | | | | | Balanced Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | | | | | | | | | | | Enterprise Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | | | | | | | | | | | Flexible Bond Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | | | | | | | | | | | Forty Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | Global Allocation Portfolio – Moderate | | | | | | | | | | | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | | | | | | | | | | | Global Research Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | | | | | | | | | | | Global Technology Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | Global Unconstrained Bond Portfolio | | | | | | | | | | | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | Janus Aspen INTECH U.S. Low Volatility Portfolio | | | | | | | | | | | | Service Shares | | | | | | | | Janus Aspen Perkins Mid Cap Value Portfolio | | | | | | | | | | | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | | | | | | | | | | | Janus Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | | | | | | | | | | | | Overseas Portfolio | | Institutional Shares | | | | | | | | | | Service Shares | | | | | | | |
A-1
Appendix B Dates Relating to Current Advisory Agreements | | | | | | | Fund | | Date of Current Advisory Agreement | | Date Current Advisory Agreement Last Approved by Shareholders | | Date Current Advisory Agreement Last Approved For Continuance of Board | Balanced Portfolio | | July 1, 2004, as amended February 1, 2006 and June 14, 2006 | | | | December 9, 2015 | | | | | | | | Enterprise Portfolio | | July 1, 2004, as amended February 1, 2006, June 14, 2006 and May 1, 2009 | | | | December 9, 2015 | | | | | | | | Flexible Bond Portfolio | | July 1, 2004, as amended February 1, 2006 and June 14, 2006 | | | | December 9, 2015 | | | | | | | | Forty Portfolio | | July 1, 2010, as amended December 3, 2010 | | | | December 9, 2015 | | | | | | | | Global Allocation Portfolio – Moderate | | July 1, 2004, as amended February 1, 2006, June 14, 2006, May 1, 2009, December 3, 2010 and May 1, 2013 | | | | December 9, 2015 | | | | | | | | Global Research Portfolio | | May 1, 2009, as amended July 1, 2010, August 31, 2011 and May 1, 2013 | | | | December 9, 2015 | | | | | | | | Global Technology Portfolio | | July 1, 2004, as amended February 1, 2006 and June 14, 2006 | | | | December 9, 2015 | | | | | | | | Global Unconstrained Bond Portfolio | | January 29, 2015, as amended October 5, 2016 | | | | December 9, 2015 | | | | | | | | Janus Aspen INTECH U.S. Low Volatility Portfolio | | September 6, 2012 | | | | December 9, 2015 | | | | | | | | Janus Aspen Perkins Mid Cap Value Portfolio | | December 31, 2008, as amended December 3, 2010 | | | | December 9, 2015 | | | | | | | | Janus Portfolio | | July 1, 2010, as amended December 3, 2010 | | | | December 9, 2015 | | | | | | | | Overseas Portfolio | | July 1, 2010, as amended December 3, 2010 | | | | December 9, 2015 |
B-1
Appendix C Advisory Fee Rates | | | | | | | | | | | | | Fund | | Fiscal Year End | | | Contractual Investment Advisory Fee Rate | | | Performance Adjusted Investment Advisory Fee Rate(1) | Balanced Portfolio | | | 12/31/15 | | | All Asset Levels | | | 0.55 | % | | N/A | Enterprise Portfolio | | | 12/31/15 | | | All Asset Levels | | | 0.64 | % | | N/A | Flexible Bond Portfolio | | | 12/31/15 | | | First $300 Million Over $300 Million | |
| 0.55
0.45 | %
% | | N/A | Forty Portfolio* | | | 12/31/15 | | | All Asset Levels | | | 0.64 | % | | 0.65%(2) | Global Allocation Portfolio – Moderate | | | 12/31/15 | | | All Asset Levels | | | 0.05 | % | | N/A | Global Research Portfolio* | | | 12/31/15 | | | All Asset Levels | | | 0.60 | % | | 0.57%(2) | Global Technology Portfolio | | | 12/31/15 | | | All Asset Levels | | | 0.64 | % | | N/A | Global Unconstrained Bond Portfolio | | | 12/31/15 | | | First $1 Billion Next $2 Billion Over $3 Billion | |
| 0.65
0.62 0.60 | %
% % | | N/A | Janus Aspen INTECH U.S. Low Volatility Portfolio | | | 12/31/15 | | | All Asset Levels | | | 0.50 | % | | N/A | Janus Aspen Perkins Mid Cap Value Portfolio* | | | 12/31/15 | | | All Asset Levels | | | 0.64 | % | | [ ]% | Janus Portfolio* | | | 12/31/15 | | | All Asset Levels | | | 0.64 | % | | 0.58%(2) | Overseas Portfolio* | | | 12/31/15 | | | All Asset Levels | | | 0.64 | % | | 0.37% |
| (1) | Before fee waiver or expense reimbursement. See Appendix F for additional information regarding fee waivers. |
* Additional Information Regarding Performance Fees: For each Fund listed in the chart below, the investment advisory fee rate is determined by calculating a base fee (shown in the previous table) and applying a performance adjustment (described in further detail below). The performance adjustment either increases or decreases the base fee depending on how well each Fund has performed relative to its benchmark index as shown below: | | | | | Fund | | Benchmark Index | | Performance Hurdle | Janus Forty Portfolio | | Russell 1000 Growth Index | | 8.50% | Janus Global Research Portfolio | | MSCI World Index | | 6.00% | Janus Aspen Perkins Mid Cap Value Portfolio | | Russell Midcap Value Index | | 4.00% | Janus Portfolio | | Core Growth Index | | 4.50% | Overseas Portfolio | | MSCI All Country World ex-U.S. Index | | 7.00% |
The calculation of the Boardperformance adjustment applies as follows: Investment Advisory Fee = Base Fee Rate +/– Performance Adjustment The investment advisory fee rate paid to the Adviser by each Fund in the table above consists of two components: (1) a base fee calculated by applying the contractual fixed rate of the advisory fee to the Fund’s average daily net assets during the previous month (“Base Fee Rate”), plus or minus (2) a performance-fee adjustment (“Performance Adjustment”) calculated by applying a variable rate of up to 0.15% (positive or negative) to the Fund’s average daily net assets during the applicable performance measurement period. The performance measurement period is the previous 36 months. As an example, if the Fund outperformed its Performance Fee Benchmark over the 36-month performance measurement period by its Performance Hurdle, the advisory fee rate would increase by 0.15% (assuming constant assets). Conversely, if the Fund underperformed its Performance Fee Benchmark over the performance measurement period by its Performance Hurdle, the advisory fee rate would decrease by 0.15% (assuming constant assets). Actual performance within the full range of the Performance Hurdle rate may result in positive or negative incremental adjustments to the advisory fee rate of greater or less than 0.15% C-1
No Performance Adjustment is applied unless the difference between a Fund’s investment performance and the cumulative investment record of the Fund’s benchmark index is 0.50% or greater (positive or negative) during the applicable performance measurement period. The Base Fee Rate is subject to an upward or downward Performance Adjustment for every full 0.50% increment by which the Fund outperforms or underperforms its benchmark index. Because the Performance Adjustment is tied to a Fund’s relative performance compared to its benchmark index (and not its absolute performance), the Performance Adjustment could increase the Adviser’s fee even if the Fund’s shares lose value during the performance measurement period and could decrease the Adviser’s fee even if the Fund’s shares increase in value during the performance measurement period. For purposes of computing the Base Fee Rate and the Performance Adjustment, net assets are averaged over different periods (average daily net assets during the previous month for the Base Fee Rate, versus average daily net assets during the performance measurement period for the Performance Adjustment). Performance of a Fund is calculated net of expenses whereas a Fund’s benchmark index does not have any fees or expenses. Reinvestment of dividends and distributions is included in calculating both the performance of a Fund and the Fund’s benchmark index. The Base Fee Rate is calculated and accrued daily. The Performance Adjustment is calculated monthly in arrears and is accrued throughout the month. The investment advisory fee is paid monthly in arrears. Under extreme circumstances involving underperformance by a rapidly shrinking Fund, the dollar amount of the Performance Adjustment could be more than the dollar amount of the Base Fee Rate. In such circumstances, the Adviser would reimburse the applicable Fund. The application of an expense limit, if any, will have a positive effect upon a Fund’s performance and may result in an increase in the Performance Adjustment. It is possible that the cumulative dollar amount of additional compensation ultimately payable to the Adviser may, under some circumstances, exceed the cumulative dollar amount of management fees waived by Janus Capital. The investment performance of a Fund’s Service Shares (waiving the upfront sales load) for the performance measurement period is used to calculate the Performance Adjustment. After the Adviser determines whether a particular Fund’s performance was above or below its benchmark index by comparing the investment performance of the Fund’s Service Shares against the cumulative investment record of that Fund’s benchmark index, the Adviser applies the same Performance Adjustment (positive or negative) across each other class of shares of the Fund, as applicable. It is not possible to predict the effect of the Performance Adjustment on future overall compensation to the Adviser since it depends on the performance of each Fund relative to the record of the Fund’s benchmark index and future changes to the size of each Fund. C-2
Appendix D Comparable Funds The following table sets forth information regarding other registered investment companies or series thereof (other than the Trust and the Funds) managed by the Adviser, a Sub-Adviser or Henderson that have similar investment strategies to a Fund. | | | | | | | | | | | | | Fund | | Comparable Fund | | Comparable Fund Contractual Fee Rate | | | Comparable Fund Waivers | | Comparable Fund Net Assets (as of 9/30/16) | Balanced Portfolio | | Janus Investment Fund – Balanced Fund | | All Asset Levels | | | 0.55 | % | | Expense limit: 0.68% | | $12.91 billion | | Mainstay VP Janus Balanced Portfolio(1) | | First $250 million
Over $250 million | |
| 0.27
0.25 | %
% | | [ ]% | | $1.02 billion | | Ohio National Fund, Inc., Risk Managed Balanced Portfolio(1) | | First $500 million
Over $500 million | |
| 0.35
0.25 | %
% | | [ ]% | | $200 million | | Transamerica Janus Balanced VP(1) | | First $1 billion
Over $1 billion | |
| 0.325
0.30 | %
% | | [ ]% | | $745 million | Enterprise Portfolio | | Janus Investment Fund – Enterprise Fund | | All Asset Levels | | | 0.64 | | | Expense limit: 0.87% | | $9.76 billion | | VALIC Company I – Mid Cap Strategic Growth Fund(1) | | First $50 million
Over $50 million | |
| 0.44
0.40 | %
% | | [ ]% | | $151 million | | Penn Series Fund, Inc. – Small Cap Growth Fund(1) | | All Asset Levels | | | 0.55 | % | | [ ]% | | $88 million | | Guardian Mid Cap Traditional Growth VIP Fund(1) | | First $50 million
Over $50 million | |
| 0.44
0.40 | %
% | | [ ]% | | $10 million | | Transamerica Janus Mid-Cap Growth VP(1) | | First $500 million
Next $500 million Over $1 billion | |
| 0.375
0.34 0.32 | %
% % | | [ ]% | | $571 million | Flexible Bond Portfolio | | Janus Investment Fund – Flexible Bond Fund | | First $300 Million
Over $300 Million | |
| 0.50
0.40 | %
% | | Expense limit: 0.51% | | $[ ] | Forty Portfolio | | Janus Investment Fund – Forty Fund | | All Asset Levels | | | 0.64 | %* | | Expense limit: 0.64% | | $2.14 billion | | SunAmerica Series Trust – SA Janus Focused Growth Portfolio | | First $250 million
Over $250 million | |
| 0.35
0.30 | %
% | | [ ]% | | $255 million | Global Research Portfolio | | Janus Investment Fund – Global Research Fund | | All Asset Levels | | | 0.60 | %* | | — | | $2.49 billion | Global Technology Portfolio | | Janus Investment Fund – Global Technology Fund | | All Asset Levels | | | 0.64 | % | | Expense limit: 0.90% | | $1.27 billion | | Henderson Global Technology Fund | | First $1 billion
Over $1 billion | |
| 0.90
0.80 |
% | | — | | $219 million | Global Unconstrained Bond Portfolio | | Janus Investment Fund – Global Unconstrained Bond Fund | | First $1 Billion
Next $2 Billion Over $3 Billion | |
| 0.65
0.62 0.60 | %
% % | | Expense limit: 0.82% | | $[ ] | | Henderson Unconstrained Bond Fund | | First $1 billion
Next $1 billion Over $2 billion | |
| 0.65
0.55 0.50 | %
% % | | Expense limit: 0.90% | | $[ ] | Janus Aspen INTECH U.S. Low Volatility Portfolio | | N/A | | | | | | | | | | | Janus Aspen Perkins Mid Cap Value Portfolio | | Janus Investment Fund – Perkins Mid Cap Value Fund(3) | | All Asset Levels | | | 0.64 | %* | | Expense limit: 0.83% | | $[ ] | Janus Portfolio | | Janus Investment Fund – Janus Fund | | All Asset Levels | | | 0.64 | | | Expense limit: 0.83% | | $7.64 billion | Overseas Portfolio | | Janus Investment Fund – Overseas Fund | | All Asset Levels | | | 0.64 | %* | | Expense limit: 0.95% | | $[ ] |
D-1
Appendix E Information Regarding Officers and Directors of Adviser and Sub-Advisers Janus Capital Management LLC(1) | | | | | Name | | Janus Capital/Affiliated Entity Name | | Position(s) with Janus Capital or Affiliated Entity | Enrique Chang | | Janus Capital Group Inc. | | President – Head of Investments | | | Janus Capital Management LLC | | President – Head of Investments | | | Perkins Investment Management LLC | | Director | | | Janus Capital International Limited | | Director | | | | Augustus Cheh | | Janus Capital Management LLC | | Executive Vice President | | | Janus Capital Asia Limited | | Director | | | Janus Capital Trust Manager Limited | | Director | | | Janus Capital International Limited | | Director | | | | Michael Drew Elder | | Janus Capital Group Inc. | | Executive Vice President | | | Janus Capital Management LLC | | Executive Vice President | | | Janus Distributors LLC | | President | | | Perkins Investment Management LLC | | Director | | | | David W. Grawemeyer | | Janus Capital Group Inc. | | General Counsel and Executive Vice President | | | Janus Capital Management LLC | | Executive Vice President | | | Janus Management Holdings Corp. | | General Counsel, Executive Vice President, and Director | | | Janus International Holding LLC | | General Counsel and Executive Vice President | | | | Brennan A. Hughes | | Janus Capital Group Inc. | | Chief Accounting Officer and Senior Vice President | | | Janus Capital Management LLC | | Chief Accounting Officer and Senior Vice President | | | Janus Distributors LLC | | Chief Accounting Officer and Senior Vice President | | | Janus Services LLC | | Chief Accounting Officer and Senior Vice President | | | The Janus Foundation | | Director | | | Janus Management Holdings Corp. | | Chief Accounting Officer and Senior Vice President | | | Janus Holdings LLC | | Senior Vice President | | | INTECH Investment Management LLC | | Vice President | | | Perkins Investment Management LLC | | Vice President and Controller | | | Janus International Holding LLC | | Chief Accounting Officer, Senior Vice President, and Director | | | VS Holdings Inc. | | Chief Accounting Officer, Senior Vice President, and Director | | | Janus Capital Asia Limited | | Director | | | Janus Capital Taiwan Limited | | Director | | | Janus Capital Singapore Pte. Limited | | Director | | | Janus Capital International Limited | | Director | | | Janus Capital Switzerland Limited | | Director | | | | Bruce L. Koepfgen | | Janus Capital Group Inc. | | President | | | Janus Capital Management LLC | | President | | | Janus Distributors LLC | | Executive Vice President | | | Janus Management Holdings Corp. | | Executive Vice President and Director | | | INTECH Investment Management LLC | | Executive Vice President and Working Director | | | Perkins Investment Management LLC | | Executive Vice President and Director | | | Janus International Holding LLC | | Executive Vice President and Director | | | VS Holdings Inc. | | President and Director | | | Kapstream Capital Pty Limited | | Director | | | | David R. Kowalski | | Janus Capital Management LLC | | Chief Compliance Officer and Senior Vice President | | | Janus Distributors LLC | | Chief Compliance Officer and Senior Vice President |
E-1
| | | | | Name | | Janus Capital/Affiliated Entity Name | | Position(s) with Janus Capital or Affiliated Entity | | | Janus Services LLC | | Chief Compliance Officer and Senior Vice President | | | The Janus Foundation | | Director | | | INTECH Investment Management LLC | | Vice President | | | Perkins Investment Management LLC | | Vice President | | | VS Holdings Inc. | | Chief Compliance Officer and Senior Vice President | | | | Tiphani D. Krueger | | Janus Capital Group Inc. | | Executive Vice President | | | Janus Capital Management LLC | | Executive Vice President | | | The Janus Foundation | | President and Director | | | Janus Management Holdings Corp. | | Executive Vice President | | | | Mari Lakio-Grundy | | Janus Capital Management LLC | | Assistant General Counsel and Vice President | Adrian Lam | | Janus Capital Management LLC | | Assistant General Counsel and Vice President | David Master | | Janus Capital Management LLC | | Chief Marketing Officer and Senior Vice President | | | Janus Holdings LLC | | Senior Vice President | | | | Jennifer J. McPeek | | Janus Capital Group Inc. | | Chief Financial Officer and Executive Vice President | | | Janus Capital Management LLC | | Chief Financial Officer and Executive Vice President | | | Janus Management Holdings Corp. | | Chief Financial Officer and Executive Vice President | | | Perkins Investment Management LLC | | Vice President and Director | | | | | | VS Holdings Inc. | | Chief Financial Officer and Executive Vice President | | | Kapstream Capital Pty Limited | | Director | | | | Michelle R. Rosenberg | | Janus Capital Management LLC | | Deputy General Counsel and Senior Vice President | | | Janus Distributors LLC | | Deputy General Counsel and Senior Vice President | | | Janus Services LLC | | Deputy General Counsel and Senior Vice President | | | Janus Diversified Alternatives Subsidiary, Ltd. | | Director | | | Janus Aspen Global Unconstrained Bond Subsidiary, Ltd. | | Director | | | Janus Global Unconstrained Bond Subsidiary, Ltd. | | Director | | | | Richard M. Weil | | Janus Capital Group Inc. | | Chief Executive Officer and Director | | | Janus Capital Management LLC | | Chief Executive Officer | | | Janus Management Holdings Corp. | | President and Director | | | INTECH Investment Management LLC | | Working Director | | | Perkins Investment Management LLC | | Director | | | Kapstream Capital Pty Limited | | Director |
(1) | The business address for each officer and director is 151 Detroit Street, Denver, Colorado 80206. |
The following officers or Trustees /s/ Robin C. Beery
Robin C. Beery
of the Funds are officers, employees, directors, general partners or shareholders of the Adviser: | | | | | Name | | Title with the Funds | | Title with the Adviser | Bruce L. Koepfgen | | President and Chief Executive Officer | | President | | | | David R. Kowalski | | Vice President, Chief Compliance Officer, and Anti- Money Laundering Officer | | Chief Compliance Officer and Senior Vice President |
E-2
INTECH Investment Management LLC(1) | | | | | Name | | Entity Name | | Position(s) with Entity | Adrian Banner | | INTECH Investment Management LLC | | Chief Executive Officer, Chief Investment Officer, and Working Director | | | | Lance V. Campbell | | INTECH Investment Management LLC | | Chief Financial Officer and Executive Vice President | | | | Patricia Flynn | | INTECH Investment Management LLC | | Chief Compliance Officer and Senior Vice President | | | | Brennan A. Hughes | | INTECH Investment Management LLC | | Vice President | | | | Bruce L. Koepfgen | | INTECH Investment Management LLC | | Executive Vice President and Working Director | | | | David R. Kowalski | | INTECH Investment Management LLC | | Vice President | | | | Vassilios Papathanakos | | INTECH Investment Management LLC | | Deputy Chief Investment Officer and Executive Vice President | | | | David Schofield | | INTECH Investment Management LLC | | President, International Division and Working Director | | | | Richard M. Weil | | INTECH Investment Management LLC | | Working Director | | | | Justin B. Wright | | INTECH Investment Management LLC | | General Counsel, Chief Operating Officer, and Executive Vice President |
(1) | The business address for each officer and director is 25 Okeechobee Blvd., Suite 1800, West Palm Beach, Florida 33401. |
Perkins Investment Management LLC(1) | | | | | Name | | Entity Name | | Position(s) with Entity | Enrique Chang | | Perkins Investment Management LLC | | Director | | | | Michael Drew Elder | | Perkins Investment Management LLC | | Director | | | | Ted Hans | | Perkins Investment Management LLC | | Chief Operating Officer, Chief Compliance Officer, and Director | | | | Brennan A. Hughes | | Perkins Investment Management LLC | | Vice President and Controller | | | | Greg Kolb | | Perkins Investment Management LLC | | Chief Investment Officer and Director | | | | Bruce L. Koepfgen | | Perkins Investment Management LLC | | Executive Vice President and Director | | | | David R. Kowalski | | Perkins Investment Management LLC | | Vice President | | | | Jennifer J. McPeek | | Perkins Investment Management LLC | | Vice President and Director | | | | Valerie Newman | | Perkins Investment Management LLC | | Director | | | | Tom Perkins | | Perkins Investment Management LLC | | Chief Executive Officer and Director | | | | Richard M. Weil | | Perkins Investment Management LLC | | Director | | | | Ryan G. Wolf | | Perkins Investment Management LLC | | Chief Information Officer |
(1) | The business address for each officer and director is 311 S. Wacker Drive, Suite 6000, Chicago, Illinois 60606. |
E-3
Appendix F Fees Paid | | | | | | | | | | | | | | | Fund | | Fiscal Year End | | Actual Advisory Fees Paid to the Adviser Before Waiver | | Fees Waived or Reimbursed by the Adviser | | Actual Advisory Fee Paid to the Adviser After Waiver | | Fees Paid by the Adviser to the Sub-Adviser | | Distribution and or Service Fees paid to Distributor(4) | | Fees paid to Janus Services(5) | Balanced Portfolio | | 12/31/15 | | $11,696,000 | | N/A | | $11,696,000 | | N/A | | $4,113,000 | | N/A | Enterprise Portfolio | | 12/31/15 | | $4,681,000 | | N/A | | $4,681,000 | | N/A | | $748,000 | | N/A | Flexible Bond Portfolio | | 12/31/15 | | $3,009,000 | | $(2,000)a | | $3,007,000 | | N/A | | $626,000 | | N/A | Forty Portfolio | | 12/31/15 | | $5,265,000 | | N/A | | $5,265,000 | | N/A | | $1,254,000 | | N/A | Global Allocation Portfolio – Moderate | | 12/31/15 | | $5,000 | | $(5,000)a | | $0 | | N/A | | $28,000 | | N/A | Global Research Portfolio | | 12/31/15 | | $5,802,000 | | N/A | | $5,802,000 | | N/A | | $545,000 | | N/A | Global Technology Portfolio | | 12/31/15 | | $1,075,000 | | $0a | | $1,075,000 | | N/A | | $396,000 | | N/A | Global Unconstrained Bond Portfolio | | 12/31/15 | | $29,000 | | $(29,000)(1)b | | $0 | | N/A | | $9,000 | | N/A | Janus Aspen INTECH U.S. Low Volatility Portfolio | | 12/31/15 | | $2,962,000 | | $0a | | $2,962,000 | | $1,470,000(3) | | $1,470,000 | | N/A | Janus Aspen Perkins Mid Cap Value Portfolio | | 12/31/15 | | $626,000 | | $0a | | $626,000 | | $311,000(3) | | $224,000 | | N/A | Janus Portfolio | | 12/31/15 | | $3,851,000 | | N/A | | $3,851,000 | | N/A | | $416,000 | | N/A | Overseas Portfolio | | 12/31/15 | | $4,578,000 | | N/A | | $4,578,000 | | N/A | | $1,806,000 | | N/A |
| (1) | Fees waived or expenses reimbursed by Janus Capital exceeded the advisory fee. |
| (2) | After the reimbursement of expenses incurred or fees waived by Janus Capital, if applicable. |
| (3) | After the reimbursement of expenses incurred or fees waived by Janus Capital, and any performance adjustment, if applicable. |
| (4) | Payments (substantially all of which Janus Distributors pays out as compensation to broker-dealers and other services providers) cover activities including, but not limited to, advertising and literature, as well as prospectus preparation, printing, and mailing. |
| (5) | Administrative service fees to Janus Services were first implemented on May 1, 2016. |
Fee Waivers | a | Janus Capital has contractually agreed to waive its investment advisory fee and/or reimburse Fund expenses to the extent that the Portfolio’s total annual fund operating expenses (excluding any performance adjustments to management fees, any applicable distribution and shareholder servicing fees, administrative services fees payable pursuant to the Transfer Agency Agreement, brokerage commissions, interest, dividends, taxes, acquired fund fees and expenses, and extraordinary expenses) exceed a certain limit until at least [May 1, 2018]. The contractual waiver may be terminated or modified prior to this date only at the discretion of the Portfolio’s Board of Trustees. |
| | | | | Fund | | Expense Limit | | Flexible Bond Portfolio | | | 0.57 | % | Global Allocation Portfolio – Moderate | | | 0.14 | % | Global Technology Portfolio | | | 0.90 | % | Janus Aspen INTECH U.S. Low Volatility Portfolio | | | 0.79 | % | Janus Aspen Perkins Mid Cap Value Portfolio | | | 0.77 | % |
| b | Janus Capital has contractually agreed to waive its investment advisory fee and/or reimburse Fund expenses to the extent that the Fund’s total annual fund operating expenses, which include the other expenses of the subsidiary (excluding applicable distribution and shareholder servicing fees, administrative services fees payable pursuant to the Transfer Agency Agreement, brokerage commissions, interest, dividends, taxes, acquired fund fees and expenses, and extraordinary expenses) exceed 0.68% until at least [May 1, 2018]. The contractual waiver may be terminated or modified prior to this date only at the discretion of the Fund’s Board of Trustees. For a period beginning with the Fund’s commencement of operations (January 29, 2015) and expiring on the third anniversary of the commencement of operations, or when the Portfolio’s assets meet the first breakpoint in the investment advisory fee schedule (0.65% of the first $1 billion of the average daily closing net asset value of the Fund), whichever occurs first, Janus Capital may recover from the Fund fees and expenses previously waived or reimbursed if the Portfolio’s expense ratio, including recovered expenses, falls below the expense limit. There is no guarantee that the Portfolio’s assets will reach this asset level. |
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Appendix G Compensation of Trustees The following table shows the aggregate compensation paid to each Trustee for the Fund’s fiscal year ended in December 31, 2016, as well as the total compensation paid by all of the Janus Funds during the calendar year 2016. None of the Trustees receives any pension or retirement benefits from the Funds or the Janus Funds. The Trustees have established a deferred compensation plan under which a Trustee may elect to defer receipt of all, or a portion, of the compensation earned for services to the Funds, in lieu of receiving current payments of such compensation. Any deferred amount is treated as though an equivalent dollar amount has been invested in shares of one or more funds advised by Janus Capital (“shadow investments”). | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fund | | Wallace | | | Brown(4) | | | Cvengros(4) | | | Etienne(5) | | | McCalpin(3)(4) | | | Poliner(6) | | | Rothe(4) | | | Stewart(4) | | | Wolf(4) | | Balanced Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Enterprise Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Flexible Bond Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Forty Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Global Allocation Portfolio – Moderate | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Global Research Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Global Technology Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Global Unconstrained Bond Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Janus Aspen INTECH U.S. Low Volatility Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Janus Aspen Perkins Mid Cap Value Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Janus Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Overseas Portfolio | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Total Compensation from the Janus Funds for calendar year ended December 31, 2016(1)(2) | | | $0 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | For all Trustees, includes compensation for service on the boards of two Janus trusts comprised of 58 portfolios. |
| (2) | Total Compensation received from the Janus Funds includes any amounts deferred under the deferred compensation plan. The deferred compensation amounts for the year are as follows: William F. McCalpin $[], James T. Rothe $[], and Linda S. Wolf $[]. |
| (3) | Aggregate Compensation received from the Funds and Total Compensation received from all Janus Funds includes additional compensation paid for service as Independent Chairman of the Board of Trustees. |
| (4) | Aggregate Compensation received from the Funds and Total Compensation received from all Janus Funds includes additional compensation paid for service as chair of, or as Lead Trustee for, one or more committees of the Board of Trustees during certain periods. |
| (5) | Ms. Etienne was elected as a Trustee on June 14, 2016. She was appointed consultant to the Trustees effective June 2, 2014. During the calendar year ended December 31, 2016, Ms. Etienne received total compensation of $[]from the Janus Funds for serving as an independent consultant to the Trustees. Ms. Etienne’s Total Compensation includes compensation paid for services as consultant to the Trustees and as a Trustee. |
| (6) | Mr. Poliner was elected as a Trustee on June 14, 2016. He was appointed consultant to the Trustees effective January 1, 2016. During the calendar year ended December 31, 2016, Mr. Poliner received total compensation of $[]from the Janus Funds for serving as an independent consultant to the Trustees. Mr. Poliner’s Total Compensation includes compensation paid for services as consultant to the Trustees and as a Trustee. |
G-1
Appendix H Principal Officers of the Trust and Chief Executive OfficerTheir Principal Occupations The business address of Janus Aspen Series
50
LIST OF APPENDICES
each officer is 151 Detroit Street, Denver, CO 80206.
APPENDIX A: NOMINATING AND GOVERNANCE COMMITTEE CHARTER
APPENDIX B: PRINCIPAL EXECUTIVE OFFICERS OF THE TRUST AND
THEIR PRINCIPAL OCCUPATIONS
APPENDIX C: FORM OF PROPOSED AMENDED ADVISORY AGREEMENT
APPENDIX D: OTHER FUNDS MANAGED BY JANUS CAPITAL WITH
SIMILAR INVESTMENT OBJECTIVES
APPENDIX E: PRINCIPAL EXECUTIVE OFFICERS AND DIRECTORS OF
JANUS CAPITAL AND THEIR PRINCIPAL OCCUPATIONS
APPENDIX F: NUMBER OF OUTSTANDING SHARES AND NET ASSETS
APPENDIX G: 5% BENEFICIAL OWNERS OF OUTSTANDING SHARES
APPENDIX H: LEGAL MATTERS
| | | | | | | Name and Year of Birth | | Position(s) Held with the Trust | | Term of Office* and Length of Time Served | | Principal Occupation(s) and Other Directorships Held by Nominee During Past Five Years | | | | | Bruce L. Koepfgen 151 Detroit Street Denver, CO 80206 DOB: 1952 | | President and Chief Executive Officer | | 7/14-Present | | President of Janus Capital Group Inc. and Janus Capital Management LLC (since 2013); Executive Vice President and Director of Janus International Holding LLC (since 2011); Executive Vice President of Janus Distributors LLC (since 2011); Executive Vice President and Working Director of INTECH Investment Management LLC (since 2011); Executive Vice President and Director of Perkins Investment Management LLC (since 2011); and Executive Vice President and Director of Janus Management Holdings Corporation (since 2011). Formerly, Executive Vice President of Janus Services LLC (2011-2015), Janus Capital Group Inc. and Janus Capital Management LLC (2011- 2013) and Chief Financial Officer of Janus Capital Group Inc., Janus Capital Management LLC, Janus Distributors LLC, Janus Management Holdings Corporation, and Janus Services LLC (2011- 2013). | | | | | David R. Kowalski 151 Detroit Street Denver, CO 80206 DOB: 1957 | | Vice President, Chief Compliance Officer, and Anti-Money Laundering Officer | | 6/02-Present | | Senior Vice President and Chief Compliance Officer of Janus Capital, Janus Distributors LLC, and Janus Services LLC; Vice President of INTECH Investment Management LLC and Perkins Investment Management LLC; and Director of The Janus Foundation. | | | | | Jesper Nergaard 151 Detroit Street Denver, CO 80206 DOB: 1962 | | Chief Financial Officer Vice President, Treasurer, and Principal Accounting Officer | | 3/05-Present
2/05-Present | | Vice President of Janus Capital and Janus Services LLC. | | | | | Kathryn L. Santoro 151 Detroit Street Denver, CO 80206 DOB: 1974 | | Vice President, Chief Legal Counsel, and Secretary | | 12/16-Present | | Vice President of Janus Capital and Janus Services LLC (since 2016). Formerly, Vice President and Associate Counsel of Curian Capital, LLC and Curian Clearing LLC (2013-2016); and General Counsel and Secretary (2011-2012) and Vice President (2009-2012) of Old Mutual Capital, Inc. |
51
APPENDIX A
NOMINATING AND GOVERNANCE COMMITTEE CHARTER
H-1
Appendix I Audit Related Fees | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Audit Fees | | Audit Related Fees | | Tax Fees | | All Other Fees | | | Fund | | Fund | | Adviser and Related Entities | | Fund | | Adviser and Related Entities | | Fund | | Adviser and Related Entities | | | Fiscal Year Ended: | | Fiscal Year Ended: | | Fiscal Year Ended: | | Fiscal Year Ended: | | Fiscal Year Ended: | | Fiscal Year Ended: | | Fiscal Year Ended: | | | 2016 | | | 2015 | | 2016 | | 2015 | | 2016 | | 2015 | | 2016 | | 2015 | | 2016 | | 2015 | | 2016 | | 2015 | | 2016 | | 2015 | | | | | | | | | | | | | | | | Balanced Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Enterprise Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Flexible Bond Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Forty Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Global Allocation Portfolio – Moderate | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Global Research Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Global Technology Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Global Unconstrained Bond Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Janus Aspen INTECH U.S. Low Volatility Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Janus Aspen Perkins Mid Cap Value Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Janus Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | | | | | | | Overseas Portfolio | | | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] |
I-1
| | | | | | | | | | | | | | | | | | | | Total Non-Audit Fees Billed to Fund | | Total Non-Audit Fees Billed to Advisers and Fund Service Providers (Engagements Related Directly to the Operations and Financial Reporting of Fund) | | TotalNon-Audit Fees Billed to Advisers and Fund Service Providers (All Other Engagements) | | Total | | | | Fiscal Year Ended: | | Fiscal Year Ended: | | Fiscal Year Ended: | | Fiscal Year Ended: | | | 2016 | | 2015 | | 2016 | | 2015 | | 2016 | | 2015 | | 2016 | | 2015 | | | | | | | | | | Balanced Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Enterprise Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Flexible Bond Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Forty Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Global Allocation Portfolio – Moderate | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Global Research Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Global Technology Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Global Unconstrained Bond Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Janus Aspen INTECH U.S. Low Volatility Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Janus Aspen Perkins Mid Cap Value Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Janus Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] | | | | | | | | | | Overseas Portfolio | | | | [ ] | | | | [ ] | | | | [ ] | | | | [ ] |
I-2
Appendix J Nominating and Governance Committee Charter JANUS ASPEN SERIES JANUS INVESTMENT FUND
(Adopted (Adopted December 5, 2000; Revised December 10, 2001; December 10, 2002; September 16, 2003; March 16, 2004; June 15, 2004; June 14, 2005; June 14, 2006; June 20, 2008; July 6, 2009)
I. PURPOSE
2009; June 24, 2010; June 23, 2011; June 21, 2012; June 16, 2016) The Nominating and Governance Committee (the "Committee"“Committee”) is a committee of the Board of Trustees ("Trustees"(“Board” or “Trustees”) of each of Janus Aspen Series and Janus Investment Fund (each a "Trust"“Trust” and, together, the "Trusts"“Trusts” and each series thereof, a “Fund”). Its primary functions are to:
- identify and recommend individuals for Trustee membership,
- consult with management and the ChairmanChair of the Trustees in planning Trustee meetings, and
- oversee the administration of, and ensure compliance with, the Governance Procedures and Guidelines (the "Procedures“Procedures and Guidelines"Guidelines”) adopted by the Trusts as in effect from time to time.
II. COMPOSITION
The Committee shall be comprised of three or more Independent Trustees, who shall be designated by a majority vote of the Trustees. Independent Trustees are those Trustees of the Trusts who are not "interested persons"“interested persons” of the Trusts, as defined by the Investment Company Act of 1940, as amended (the "1940 Act"“1940 Act”), and who meet the standards for independence set forth in the Procedures and Guidelines. The members and Chair of the Committee shall be elected by the Trustees annually and serve until their respective successors shall be duly elected and qualified.
III. MEETINGS
The Committee shall meet four times annually, or more frequently as circumstances dictate. Special meetings (including telephone meetings) may be called by the Chair or a majority of the members of the Committee upon reasonable notice to the other members of the Committee. The presence in person or by telephone of a majority of the number of Committee members shall constitute a quorum at any meeting. If a quorum is not present, the member(s) of the Committee who is/are present may select any other Independent Trustee(s) to serve on the Committee for such meeting to constitute a quorum. The Committee may ask management and representatives of the Trusts’ servicing agents to attend meetings and provide pertinent information as appropriate.
A-1
IV. RESPONSIBILITIES AND DUTIES
IV. | RESPONSIBILITIES AND DUTIES |
In performing its duties, the Committee will maintain effective working relationships with the Trustees and management. To effectively perform his or her role, each Committee member will obtain an understanding of the detailed responsibilities of Committee membership. Each Committee member will also achieve an understanding of the Trusts'Trusts’ separation of duties and responsibilities among the investment adviser, sub-adviser(s), if any, custodian, transfer agent, fund accounting function and principal accounting officer, and the risks associated with such responsibilities. The duties and responsibilities of a Committee member shall be in addition to his or her duties as a Trustee and include responsibility to prepare for, attend to the extent possible, and actively participate in Committee meetings. Members may pursue training related to their responsibilities.
A. Trustee Nominations, Elections, and Training
J-1
A. | Trustee Nominations, Elections, and Training |
The Committee shall:
1. Identify and nominate candidates for appointment as Trustees of the
Trusts. The principal criterion for selection of candidates is their
ability to contribute to the overall functioning of the Boards and to carry
out the responsibilities of the Trustees. The Trustees, collectively,
should represent a broad cross section of backgrounds, functional
disciplines, and experience. In addition, in considering a potential
candidate's qualifications to serve as a Trustee of a Trust, the Committee
may take into account a wide variety of criteria, including, but not
limited to:
(a) The candidate's knowledge in matters related to the
investment company industry;
(b) The candidate's relevant experience, including as a director
or senior officer of public or private companies, or service as a
director/trustee of a registered investment company;
(c) The candidate's educational background;
(d) The candidate's reputation for high ethical standards and
personal and professional integrity;
(e) Any specific financial, technical or other expertise
possessed by the candidate, and the extent to which such expertise
would complement the Trustees' existing mix of skills and
qualifications;
(f) The candidate's willingness to serve, and willingness and
ability to commit the time necessary for the performance of the duties
of a Trustee, including high attendance at regular and special
meetings and participation in committee activities as needed;
(g) The candidate must exhibit stature commensurate with the
responsibility of representing Fund shareholders;
A-2
(h) If the nomination is for an "independent" trustee, the
candidate must not be considered an "interested" person of the Fund,
Janus Capital Management LLC ("Janus Capital") or any sub-adviser to a
Fund, as defined under the 1940 Act;
(i) The candidate must otherwise be qualified under applicable
laws and regulations to serve as a trustee of the applicable Trust;
and
(j) Such other criteria as the Committee determines to be
relevant in light of the existing composition of the Board, number of
Board members and any anticipated vacancies or other factors.
| 1. | Identify and nominate candidates for appointment as Trustees of the Trusts. The principal criterion for selection of candidates is their ability to contribute to the overall functioning of the Boards and to carry out the responsibilities of the Trustees. The Trustees, collectively, should represent a broad cross section of backgrounds, functional disciplines, and experience. In addition, in considering a potential candidate’s qualifications to serve as a Trustee of a Trust, the Committee may take into account a wide variety of criteria, including, but not limited to: |
| (a) | The candidate’s knowledge in matters related to the investment company industry, any professional licenses, designations, or certifications currently or previously held; |
| (b) | The candidate’s relevant experience, including as a director or senior officer of public or private companies, or service as a director/trustee of a registered investment company; |
| (c) | The candidate’s educational background; |
| (d) | The candidate’s reputation for high ethical standards and personal and professional integrity; |
| (e) | Any specific financial, technical or other expertise possessed by the candidate, and the extent to which such expertise would complement the Trustees’ existing mix of skills and qualifications; |
| (f) | The candidate’s willingness to serve, and willingness and ability to commit the time necessary for the performance of the duties of a Trustee, including high attendance at regular and special meetings and participation in committee activities as needed; |
| (g) | The candidate must exhibit stature commensurate with the responsibility of representing Fund shareholders; |
| (h) | If the nomination is for an “independent” trustee, the candidate must not be considered an “interested” person of the Fund, Janus Capital Management LLC (“Janus Capital”), or any sub-adviser to a Fund or Janus Distributors LLC, as defined under the 1940 Act; |
| (i) | The candidate must otherwise be qualified under applicable laws and regulations to serve as a trustee of the applicable Trust; and |
| (j) | Such other criteria as the Committee determines to be relevant in light of the existing composition of the Board, number of Board members and any anticipated vacancies or other factors. |
Although Janus Capital, current Trustees, current shareholders of a Fund and any other person or entity that may be deemed necessary or desirable by the Committee, may submit to the Committee suggested candidates for Trustees, neither the Committee nor the Independent Trustees as a group shall consider those candidates on a preferential basis as opposed to other possible candidates. Shareholders may submit the name of a candidate for consideration by the Committee by submitting their recommendations to the Trusts'Trusts’ Secretary in accordance with the Procedures for Consideration of Trustee Candidates Submitted by Shareholders ("(“Shareholder Nomination Procedures"Procedures”) attached as Appendix 1. The Trusts'Trusts’ Secretary will forward all such recommendations to the ChairmanChair of the Committee (or his designee) promptly upon receipt, and, for shareholder recommendations, in accordance with the Shareholder Nomination Procedures. The Committee may use any process it deems appropriate for the purpose of evaluating candidates, which process may include, without limitation, personal interviews, background checks, written submissions by the candidates and third party references. The Committee shall be empowered to use Trust assets to retain consultants and other professionals to assist in the process of evaluating candidates. There is no difference in the manner by which the Committee will evaluate nominees when the nominee is submitted by a shareholder. J-2
The Committee reserves the right to make the final selection regarding the nomination of any Trustee of a Trust and to recommend such nomination to the Independent Trustees of the applicable Trust.
2. Review periodically the composition and size of the Board of
Trustees to determine whether it may be appropriate to add individuals with
backgrounds or skill sets different from those of the current Trustees.
3. Oversee arrangements for orientation of new Independent Trustees,
continuing education for the Independent Trustees, and an annual evaluation
of the performance of the Independent Trustees in accordance with the
Procedures and Guidelines.
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B. Committee Nominations and Functions
| 2. | Review periodically the composition and size of the Board of Trustees to determine whether it may be appropriate to add individuals with backgrounds or skill sets different from those of the current Trustees. |
| 3. | Oversee arrangements for orientation of new Independent Trustees, continuing education for the Independent Trustees, and an annual evaluation of the performance of the Independent Trustees in accordance with the Procedures and Guidelines. |
B. | Committee Nominations and Functions |
The Committee shall:
1. Identify and recommend individuals for membership on all
committees, recommend individuals to chair committees, and review committee
assignments at least annually.
2. Review as necessary the responsibilities of each committee, whether
there is a continuing need for each committee, whether there is a need for
additional committees, and whether committees should be combined or
reorganized.
C. Governance Oversight
| 1. | Identify and recommend individuals for membership on all committees, recommend individuals to chair committees, and review committee assignments at least annually. |
| 2. | Review as necessary the responsibilities of each committee, whether there is a continuing need for each committee, whether there is a need for additional committees, and whether committees should be combined or reorganized. |
The Committee shall:
1. Oversee the governance processes and activities of the Trustees to
assure conformity to the Procedures and Guidelines.
2. Recommend an Independent Trustee of the Trust for appointment by
the Trustees as Chairman of the Trustees, as described in each Trust's
Declaration of Trust or Trust Instrument, or by-laws. The Chairman of the
Trustees may perform the following functions:
(a) Act as the primary contact between Janus Capital and the
Trustees, undertaking to meet or confer periodically with members of
the Janus Capital executive team regarding matters related to the
operations and performance of the Trusts;
(b) Coordinate the Trustees' use of outside resources, including
consultants or other professionals;
(c) Coordinate an annual schedule of portfolio reports to the
Trustees;
(d) Conduct the Trustee meetings;
(e) Confer with Janus Capital personnel and counsel for the
Independent Trustees in planning agendas for regular board and
committee meetings; and
(f) Perform such other duties as the Independent Trustees may
determine from time to time.
3. Review annually the Procedures and Guidelines, and recommend
changes, if any, to the Trustees.
D. Trustee Meeting Planning
| 1. | Oversee the governance processes and activities of the Trustees to assure conformity to the Procedures and Guidelines. |
| 2. | Recommend an Independent Trustee of the Trust for appointment by the Trustees as Chair of the Trustees, as described in each Trust’s Declaration of Trust or Trust Instrument, or by-laws. The Chair of the Trustees may perform the following functions: |
| (a) | Act as the primary contact between Janus Capital and the Trustees, undertaking to meet or confer periodically with members of the Janus Capital executive team regarding matters related to the operations and performance of the Trusts; |
| (b) | Coordinate the Trustees’ use of outside resources, including consultants or other professionals; |
| (c) | Coordinate an annual schedule of portfolio reports to the Trustees; |
| (d) | Conduct the Trustee meetings; |
| (e) | Confer with Janus Capital personnel and counsel for the Independent Trustees in planning agendas for regular board and committee meetings; and |
| (f) | Perform such other duties as the Independent Trustees may determine from time to time. |
| 3. | Review annually the Procedures and Guidelines, and recommend changes, if any, to the Trustees. |
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D. | Trustee Meeting Planning |
The Committee shall consult with management in planning Trustee meetings and may from time to time recommend agenda items, or request presentations from particular service providers, consultants, or portfolio managers, either to the Committee or the Trustees.
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E. Other Responsibilities and Duties
E. | Other Responsibilities and Duties |
The Committee shall:
1. Review annually the compensation of the Independent Trustees and
determine whether to recommend to the Trustees any change in the schedule
of compensation. The Committee may also recommend that the Trustees
authorize the payment of supplemental compensation to any one or more
Independent Trustees in view of special responsibilities assumed, services
rendered or any other appropriate factors.
2. Authorize and oversee investigations into any matters within the
Committee's scope of responsibilities. The Committee shall be empowered to
use Trust assets to retain independent counsel, consultants, and other
professionals to assist in the conduct of any investigation. Janus Capital
will report the use of Trust assets for such purpose quarterly to the
Trustees.
3. Review this Charter at least annually and recommend changes, if
any, to the Trustees.
4. Perform any other activities consistent with this Charter, each
Trust's Declaration of Trust or Trust Instrument, by-laws, and governing
law as the Committee or the Trustees deem necessary or appropriate.
5. Maintain minutes of its meetings and report to the Trustees.
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APPENDIX | 1. | Review annually the compensation of the Independent Trustees and determine whether to recommend to the Trustees any change in the schedule of compensation. The Committee may also recommend that the Trustees authorize the payment of supplemental compensation to any one or more Independent Trustees in view of special responsibilities assumed, services rendered or any other appropriate factors. |
| 2. | Authorize and oversee investigations into any matters within the Committee’s scope of responsibilities. The Committee shall be empowered to use Trust assets to retain independent counsel, consultants, and other professionals to assist in the conduct of any investigation or to advise the Committee. Janus Capital will report any use of Trust assets for such purpose quarterly to the Trustees. |
| 3. | Lead the Trustees’ annual self-assessment process. |
| 4. | Review this Charter at least annually and recommend changes, if any, to the Trustees. |
| 5. | Perform any other activities consistent with this Charter, each Trust’s Declaration of Trust or Trust Instrument, by-laws, and governing law as the Committee or Trustees deem necessary or appropriate. |
| 6. | Report its significant activities to the Trustees and make such recommendations with respect to the foregoing matters as the Committee may consider necessary or appropriate. |
| 7. | Maintain minutes of its meetings. |
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Appendix 1 JANUS INVESTMENT FUND JANUS ASPEN SERIES
(EACH A "TRUST," AND TOGETHER, THE "TRUSTS," AND EACH
SERIES OF A TRUST, A "FUND" (each a “Trust,” and together, the “Trusts,” and each series of a Trust, a “Fund”) PROCEDURES FOR CONSIDERATION OF TRUSTEE CANDIDATES SUBMITTED BY SHAREHOLDERS
(ADOPTED MARCH (Adopted March 16, 2004; REVISED JULYRevised July 6, 2009)
2009; Revised June 24, 2010; June 23, 2011) The Trusts'Trusts’ Nominating and Governance Committee ("Committee"(“Committee”) is responsible for identifying and nominating candidates for appointment as Trustees of the Trusts. Shareholders of a Fund may submit names of potential candidates for nomination as Trustee of a Trust in accordance with these Procedures. A candidate for nomination as Trustee of a Trust submitted by a shareholder will not be deemed to be properly submitted to the Committee for the Committee'sCommittee’s consideration unless the following qualifications have been met and procedures followed: 1. A shareholder of a Fund who wishes to nominate a candidate for election to a Trust'sTrust’s Board of Trustees ("(“Nominating Shareholder"Shareholder”) must submit any such recommendation in writing via regular mail to the attention of the Secretary of the Trust, at the address of the principal executive offices of the Trust ("(“Shareholder Recommendation"Recommendation”). 2. The Shareholder Recommendation must include: (i) the class or series and number of all shares of the Fund owned beneficially or of record by the Nominating Shareholder at the time the recommendation is submitted and the dates on which such shares were acquired, specifying the number of shares owned beneficially; (ii) a full listing of the proposed candidate'scandidate’s education, experience (including knowledge of the investment company industry, any professional licenses, designations or certifications currently or previously held, any non-profit activities relevant to board services, experience as a director or senior officer of public or private companies, and directorships on other boards or other boards of other registered investment companies), current employment, date of birth, business and residence address, and the names and addresses of at least three professional references; (iii) information as to whether the candidate is or may be an "interested person"“interested person” (as such term is defined in the Investment Company Act of 1940, as amended) of the Fund, Janus Capital Management LLC, or any sub-
advisersub-adviser to a Fund, and, if believed not to be an "interested“interested person,"” information regarding the candidate that will be sufficient for the Fund to make such determination; (iv) the written and signed consent of the candidate to be named as a nominee and to serve as a Trustee of the Trust, if elected; (v) a description of all arrangements or understandings between the Nominating Shareholder, the candidate and/or any other person or persons (including their names) pursuant to which the Shareholder Recommendation is being made, and if none, so specify; (vi) the class or series and number of all shares of the Fund owned of record or beneficially by the candidate, A-6
as reported by the candidate; and (vii) such other information that would be helpful to the Committee in evaluating the candidate. 3. The Committee may require the Nominating Shareholder to furnish such other information as it may reasonably require or deem necessary to verify any information furnished pursuant to paragraph 2 above or to determine the qualifications and eligibility of the candidate proposed by the Nominating Shareholder to serve as a Trustee of a Trust. If the Nominating Shareholder fails to provide such other information in writing within sevenfourteen days of receipt of written request from the Committee, the recommendation of such candidate as a nominee will be deemed not properly submitted for consideration, and the Committee is not required to consider such candidate. Unless otherwise specified by the Committee chairmanchair (or his designee) or by outside counsel to the independent Trustees, the Secretary of the Trust (or her designee) will promptly forward all Shareholder Recommendations to the Committee chairmanchair (or his designee) and the outside counsel to the independent Trustees of the Trust, indicating whether the Shareholder Recommendation has been properly submitted pursuant to these Procedures. J-5
Recommendations for candidates as Trustees of a Trust will be evaluated, among other things, in light of whether the number of Trustees is expected to change and whether the Trustees expect any vacancies. When the Committee is not actively recruiting new Trustees, Shareholder Recommendations will be kept on file until active recruitment is under way.
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APPENDIX B
TRUST OFFICERS AND THEIR PRINCIPAL OCCUPATIONS
TERM OF OFFICE*
NAME, ADDRESS, POSITIONS HELD AND LENGTH OF PRINCIPAL OCCUPATIONS
AND AGE WITH THE TRUST TIME SERVED DURING THE PAST FIVE YEARS
-------------- -------------------- --------------- --------------------------
Andrew Acker Executive Vice 5/07-Present Vice President and
151 Detroit Street President and Research Analyst of Janus
Denver, CO 80206 Portfolio Manager Capital, and Portfolio
DOB: 1972 Global Life Sciences Manager for other Janus
Portfolio accounts.
Jonathan D. Coleman Executive Vice 11/07-Present Co-Chief Investment
151 Detroit Street President and Co- Officer and Executive Vice
Denver, CO 80206 Portfolio Manager President of Janus
DOB: 1971 Janus Portfolio Capital, and Portfolio
Manager for other Janus
accounts. Formerly,
Portfolio Manager (2002-
2007) for Enterprise
Portfolio and Vice
President (1998-2006) for
Janus Capital.
Brian Demain Executive Vice 11/07-Present Vice President of Janus
151 Detroit Street President and Capital. Formerly,
Denver, CO 80206 Portfolio Manager Assistant Portfolio
DOB: 1977 Enterprise Portfolio Manager (2004-2007) of
Enterprise Portfolio and
Analyst (1999-2007) for
Janus Capital.
James P. Goff Executive Vice 11/07-Present Vice President and
151 Detroit Street President Research Director of Research of
Denver, CO 80206 Core Portfolio Janus Capital.
DOB: 1964
Brent A. Lynn Executive Vice 1/01-Present Vice President of Janus
151 Detroit Street President and Capital.
Denver, CO 80206 Portfolio Manager
DOB: 1964 Overseas Portfolio
Marc Pinto Executive Vice 5/05-Present Vice President of Janus
151 Detroit Street President and Co- Capital and Portfolio
Denver, CO 80206 Portfolio Manager Manager for other Janus
DOB: 1961 Balanced Portfolio accounts.
Daniel Riff Executive Vice 11/07-Present Portfolio Manager for
151 Detroit Street President and Co- other Janus accounts.
Denver, CO 80206 Portfolio Manager Formerly, Analyst (2003-
DOB: 1972 Janus Portfolio 2007) for Janus Capital.
Ron Sachs Executive Vice 1/08-Present Vice President of Janus
151 Detroit Street President and Capital and Portfolio
Denver, CO 80206 Portfolio Manager Manager for other Janus
DOB: 1967 Forty Portfolio accounts.
Laurent Saltiel Executive Vice 04/09-Present Vice President of Janus
151 Detroit Street President and Capital and Portfolio
Denver, CO 80206 Portfolio Manager Manager for other Janus
DOB: 1969 Worldwide Portfolio accounts. Formerly,
Research Analyst (2002-
2009) for Janus Capital.
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TERM OF OFFICE*
NAME, ADDRESS, POSITIONS HELD AND LENGTH OF PRINCIPAL OCCUPATIONS
AND AGE WITH THE TRUST TIME SERVED DURING THE PAST FIVE YEARS
-------------- -------------------- --------------- --------------------------
Daniel Scherman Executive Vice 5/09-Present Senior Vice President of
151 Detroit Street President and Janus Capital. Formerly,
Denver, CO 80206 Portfolio Manager Vice President and
DOB: 1961 Modular Portfolio Director of Risk and
Construction Trading for Janus Capital
Portfolio (2006), and Senior
Quantitative Analyst and
Portfolio Manager (2001-
2005) for MFS Investment
Management.
Gibson Smith Executive Vice 5/05-Present Co-Chief Investment
151 Detroit Street President and Co- 5/07-Present Officer and Executive Vice
Denver, CO 80206 Portfolio Manager President of Janus
DOB: 1968 Balanced Portfolio Capital; Executive Vice
Executive Vice President of Janus
President and Co- Distributors LLC and Janus
Portfolio Manager Services LLC; and
Flexible Bond Portfolio Manager for
Portfolio other Janus accounts.
Formerly, Vice President
(2003-2006) of Janus
Capital.
Darrell Watters Executive Vice 5/07-Present Vice President and
151 Detroit Street President and Co- Research Analyst for Janus
Denver, CO 80206 Portfolio Manager Capital and Portfolio
DOB: 1963 Flexible Bond Manager for other Janus
Portfolio accounts.
Burton H. Wilson Executive Vice 2/06-Present Vice President and
151 Detroit Street President and Assistant Director of
Denver, CO 80206 Portfolio Manager Research of Janus Capital,
DOB: 1963 Global Technology and Portfolio Manager for
Portfolio other Janus accounts.
Formerly, Research Analyst
(2004-2009) for Janus
Capital.
Robin C. Beery President and Chief 4/08-Present Executive Vice President,
151 Detroit Street Executive Officer Chief Marketing Officer,
Denver, CO 80206 and Head of Intermediary
DOB: 1967 Distribution, Global
Marketing and Product of
Janus Capital Group Inc.
and Janus Capital;
Executive Vice President,
and Head of Intermediary
Distribution, Global
Marketing and Product of
Janus Distributors LLC and
Janus Services LLC;
Director of Perkins
Investment Management LLC;
and Working Director of
INTECH Investment
Management LLC. Formerly,
President (2002-2007) and
Director (2000-2007) of
The Janus Foundation;
President (2004-2006) of
Janus Services LLC; and
Senior Vice President
(2003-2005) of Janus
Capital Group Inc. and
Janus Capital.
Stephanie Chief Legal Counsel 1/06-Present Vice President and
Grauerholz-Lofton and Secretary Vice 3/06-Present Assistant General Counsel
151 Detroit Street President of Janus Capital, and Vice
Denver, CO 80206 President and Assistant
DOB: 1970 Secretary of Janus
Distributors LLC.
Formerly, Assistant Vice
President of Janus Capital
and Janus Distributors LLC
(2006).
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TERM OF OFFICE*
NAME, ADDRESS, POSITIONS HELD AND LENGTH OF PRINCIPAL OCCUPATIONS
AND AGE WITH THE TRUST TIME SERVED DURING THE PAST FIVE YEARS
-------------- -------------------- --------------- --------------------------
David R. Kowalski Vice President, 6/02-Present Senior Vice President and
151 Detroit Street Chief Compliance Chief Compliance Officer
Denver, CO 80206 Officer, and Anti- of Janus Capital, Janus
DOB: 1957 Money Laundering Distributors LLC, and
Officer Janus Services LLC; and
Vice President of INTECH
Investment Management LLC.
Formerly, Chief Compliance
Officer of Bay Isle
Financial LLC (2003 2008)
and INTECH Investment
Management LLC (2003-
2005); Vice President of
Janus Capital (2000 2005)
and Janus Services LLC
(2004-2005).
Jesper Nergaard Chief Financial 3/05-Present Vice President of Janus
151 Detroit Street Officer Vice 2/05-Present Capital. Formerly,
Denver, CO 80206 President, Director of Financial
DOB: 1962 Treasurer, and Reporting for
Principal Accounting OppenheimerFunds, Inc.
Officer (2004-2005).
--------
* Officers are elected at least annually J-6
Appendix K Principal Holders The officers and Trustees of the Funds cannot directly own shares of the Funds without purchasing an insurance contract through one of the Participating Insurance Companies or through a qualified retirement plan. To the best knowledge of the Trust, such officers and Trustee nominees individually, and collectively as a group, do not directly or beneficially own any outstanding shares of the Funds. To the best knowledge of the Trust, unless otherwise noted, as of December 29, 2016 all of the outstanding shares of the Funds were owned by certain insurance company separate accounts or qualified plans. The percentage ownership of each separate account or qualified plan owning 5% or more of the Trustees foroutstanding shares of any Fund is listed below. To the best knowledge of the Trust, no qualified plan owned 10% or more of the shares of the Trust as a one-year term
and may also be elected fromwhole. From time to time, a Fund may have a concentration of several shareholders holding a significant percentage of shares outstanding. Investment activities of these shareholders could have a material impact on the Fund. The shares held by the Trusteesseparate accounts of each insurance company, including shares for an interim
period.
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APPENDIX C
which no voting instructions have been received, are typically voted by each insurance company in proportion to instructions received from contract owners. Since the listed insurance company separate accounts’ voting rights typically are passed through to contract owners, the insurance companies themselves may not exercise voting control over the shares held in those accounts. | | | | | | | | Fund | | Shareholder and Address of Record | | Percentage Ownership | Balanced Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Enterprise Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Flexible Bond Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Forty Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Global Allocation Portfolio – Moderate Institutional Shares | | | | | | | | Service Shares | | | | | | | | Global Research Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Global Technology Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Global Unconstrained Bond Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | |
K-1
| | | | | | | | Fund | | Shareholder and Address of Record | | Percentage Ownership | Janus Aspen INTECH U.S. Low Volatility Portfolio
| | | | | | | | Service Shares | | | | | | | | Janus Aspen Perkins Mid Cap Value Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Janus Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | | Overseas Portfolio Institutional Shares | | | | | | | | Service Shares | | | | | | | |
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Appendix L Form of New Advisory Agreements JANUS ASPEN SERIES
FORM OF [AMENDED AND RESTATED] PROPOSED INVESTMENT ADVISORY AGREEMENT
[ ] BALANCED PORTFOLIO ENTERPRISE PORTFOLIO FLEXIBLE BOND PORTFOLIO GLOBAL ALLOCATION PORTFOLIO – MODERATE GLOBAL TECHNOLOGY PORTFOLIO GLOBAL UNCONSTRAINED BOND PORTFOLIO JANUS ASPEN INTECH U.S. LOW VOLATILITY PORTFOLIO THIS [AMENDED AND RESTATED] INVESTMENT ADVISORY AGREEMENT (the "Agreement"“Agreement”) is made this [[]1(st) day of July, [2004][2010]] [as amended February 1, 2006,], 2017 between JANUS ASPEN SERIES, a Delaware statutory trust (the "Trust"“Trust”), and JANUS[JANUS HENDERSON CAPITAL MANAGEMENT LLC,LLC], a Delaware limited liability company ("JCM"(the “Adviser”). 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"“1940 Act”), and has registered its shares for public offering under the Securities Act of 1933, as amended (the "1933 Act"“1933 Act”); and WHEREAS, the Trust is authorized to create separate funds, each with its own separate investment portfolio of which the beneficial interests are represented by a separate series of shares; one of such funds created by the Trust being designated as the [ ][Balanced Portfolio] [Enterprise Portfolio] [Flexible Bond Portfolio] [Global Allocation Portfolio – Moderate] [Global Technology Portfolio] [Global Unconstrained Bond Portfolio] [Janus Aspen INTECH U.S. Low Volatility Portfolio] (the "Fund"“Fund”); and WHEREAS, the Trust and JCMthe Adviser deem it mutually advantageous that JCMthe Adviser should be appointed as the investment adviser to the Fund. NOW, THEREFORE, the parties agree as follows: [For All Funds except Global Unconstrained Bond Portfolio] 1. Appointment.Appointment. The Trust hereby appoints JCMthe Adviser as investment adviser and manager with respect to the Fund for the period and on the terms set forth in this Agreement. JCMThe Adviser hereby accepts such appointment and agrees to render the services herein set forth, for the compensation herein provided. [For Global Unconstrained Bond Portfolio] 1.Appointment. The Trust hereby appoints the Adviser as investment adviser and manager, commodity trading adviser and commodity pool operator, with respect to the Fund for the period and on the terms set forth in this Agreement. The Adviser hereby accepts such appointment and agrees to render the services herein set forth, for the compensation herein provided. 2.Investment Advisory Services. JCMServices. The Adviser shall determine the securities or other assets to be purchased, sold or held and shall place orders for the purchase or sale of such securities or other assets with brokers, dealers or others. JCMThe Adviser shall furnish continuous advice and recommendations to the Fund, and have authority to act with respect thereto, as to the acquisition, holding, or disposition of any or all of the securities or other assets which the Fund may own or contemplate acquiring from time to time. JCMThe Adviser shall give due consideration to the investment policies and restrictions and the other statements concerning the Fund in the Amended and Restated Trust Instrument bylaws,(“Trust Instrument”), Bylaws, and registration statements under the 1940 Act and the 1933 Act, and to the provisions of the Internal Revenue Code, as amended from time to time, applicable to the Fund as a regulated investment company and as a funding vehicle for variable insurance contracts. In addition, JCMthe Adviser shall cause its
C-1
officers to attend meetings and furnish oral or written reports, as the Trust may reasonably require, in L-1
order to keep the Trustees and appropriate officers of the Trust fully informed as to the condition of the investment portfolio of the Fund. [Subject to the approval of the Trustees of the Trust and, if required, the shareholders of the Fund, the Adviser is authorized to engage one or more subadvisers in connection with the Adviser’s duties and responsibilities under this Agreement, which subadvisers may be, but are not required to be, affiliates of the Adviser.1] 3.Other Services. JCMServices. The Adviser is hereby authorized (to the extent the Trust has not otherwise contracted) but not obligated (to the extent it so notifies the Trustees at least 60 days in advance), to perform (or arrange for the performance by other service providers, including affiliates of)of, independent third party service providers, or duly appointed subadvisers whether affiliated or not) the management and administrativeadministration services necessary for the operation of the Fund. JCMThe Adviser is specifically authorized, on behalf of the Trust and the Fund, to conduct relations with custodians, depositories, transfer and pricing agents, administrators, fund accounting agents, accountants, attorneys, underwriters, brokers and dealers, corporate fiduciaries, insurance company separate accounts, insurers, banks, agents, and such other persons in any such other capacity deemed by JCMthe Adviser and/or the Trustees to be necessary or desirable. JCMTo the extent the Trust has not otherwise contracted on behalf of the Fund, the Adviser shall generally monitor and report to Fund officers the Fund'sFund’s compliance with investment policies and restrictions as set forth in the currently effective prospectus and statement of additional information relating to the shares of the Fund under the 1933 Act. JCMThe Adviser shall make reports to the Trustees of its performance of services hereunder upon request therefor and furnish advice and recommendations with respect to such other aspects of the business and affairs of the Fund as it shall determine to be desirable. JCMThe Adviser is also authorized, subject to review by the Trustees, to furnish such other services as JCMthe Adviser shall from time to time determine to be necessary or useful to perform the services contemplated by this Agreement.
Agreement to the extent such services are not otherwise contracted by the Trust, on behalf of the Fund. 4.Obligations of Trust.Trust. The Trust shall have the following obligations under this Agreement:
(a) to keep JCM continuously and fully informed as to the composition
of its investment portfolio and the nature of all of its assets and
liabilities from time to time;
(b) to furnish JCM with a certified copy of any financial statement or
report prepared for it by certified or independent public accountants
and with copies of any financial statements or reports made to its
shareholders or to any governmental body or securities exchange;
(c) to furnish JCM with any further materials or information which JCM
may reasonably request to enable it to perform its function under this
Agreement; and
(d) to compensate JCM for its services and reimburse JCM for its
expenses incurred hereunder in accordance with the provisions hereof.
| (a) | to keep the Adviser continuously and fully informed as to the composition of its investment portfolio and the nature of all of its assets and liabilities from time to time; |
| (b) | to furnish the Adviser with a certified copy of any financial statement or report prepared for it by certified or independent public accountants and with copies of any financial statements or reports made to its shareholders or to any governmental body or securities exchange; |
| (c) | to furnish the Adviser with any further materials or information which the Adviser may reasonably request to enable it to perform its function under this Agreement; and |
| (d) | to compensate the Adviser for its services and reimburse the Adviser for its expenses incurred hereunder in accordance with the provisions hereof. |
5. Compensation. Compensation. [For Balanced Portfolio:] The Trust shall pay to JCMthe Adviser for its services pursuant to this Agreement a [monthly base] fee[,fee, calculated and payable for each day that this Agreement is in effect, of 1/365] [of 1/12]365 of 0.64%0.55% of the [average] daily closing net asset value of the Fund [("Base Fee")(1/366 of 0.55% of the daily closing net asset value of the Fund in a leap year). The fee shall be paid monthly. [For Enterprise Portfolio and Global Technology Portfolio:] [( The Trust shall pay to the Adviser for its services pursuant to this Agreement a fee, calculated and payable for each day that this Agreement is in effect, of 1/365 of 0.64% of the daily closing net asset value of the Fund (1/366 of 0.64% of the daily closing net asset value of the Fund in a leap year). The fee shall be paid monthly. 1 | With the exception of Global Unconstrained Bond Portfolio, this text does not appear in each Fund’s Investment Advisory Agreement, but will be included in it to the extent that a Fund’s shareholders approve Proposal 5, the Manager of Managers Proposal, included in this Proxy Statement. |
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[For Flexible Bond Portfolio:] [adjusted by The Trust shall pay to the Adviser for its services pursuant to this Agreement a performance
fee, as set forth in Schedule A. For any period less than a month during whichcalculated and payable for each day that this Agreement is in effect, of 1/365 of 0.55% of the Base Fee shall be prorated
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according tofirst $300,000,000 of the proportion which such period bears todaily closing net asset value of the Fund, plus 1/365 of 0.45% of the daily closing net asset value in excess of $300,000,000 (or 1/366 of the daily closing net asset value of either rate in a full month of 28, 29,
30 or 31 days, as the case may be.] [Theleap year). The fee shall be paid monthly. [For Global Allocation Portfolio – Moderate:] The Trust shall pay to the Adviser for its services pursuant to this Agreement a fee, calculated and payable for each day that this Agreement is in effect, of 1/365 of 0.07% of the daily closing net asset value of the Fund (1/366 of 0.07% of the daily closing net asset value of the Fund in a leap year). The fee shall be paid monthly. [For Global Unconstrained Bond Portfolio:] The Trust shall pay to the Adviser for its services a fee, calculated and payable for each day that this Agreement is in effect, of 1/365 of 0.65% of the first $1,000,000,000 of the average daily closing net asset value of the Fund, plus 1/365 of 0.62% of the next $2,000,000,000 of the average daily closing asset value of the Fund, plus 1/365 of 0.60% of the average daily closing net asset value of the Fund in excess of $3,000,000,000 (1/366 of 0.65% of the first $1,000,000,000 of the average daily closing asset value of the Fund, plus 1/366 of 0.62% of the next $2,000,000,000 of the average daily closing asset value of the Fund, plus 1/366 of 0.60% of the average daily closing net asset value of the Fund in excess of $3,000,000,000 in a leap year). The fee shall be paid monthly. To the extent the Fund invests its assets in the Janus Aspen Global Unconstrained Bond Subsidiary, Ltd., a wholly-owned subsidiary of the Fund (“Subsidiary”), Janus Capital shall not collect advisory fees that Janus Capital would otherwise be entitled to under this Agreement in an amount equal to the fee that Janus Capital receives from the Subsidiary. [For Janus Aspen INTECH U.S. Low Volatility Portfolio] The Trust shall pay to the Adviser for its services pursuant to this Agreement a fee, calculated and payable for each day that this Agreement is in effect, of 1/365 of 0.50% of the average daily closing net asset value of the Fund (1/366 of 0.50% of the average daily closing net asset value of the Fund in a leap year). The fee shall be paid monthly. [For all Funds except Global Allocation Portfolio – Moderate:] 6.Expenses Borne by JCM.the Adviser. In addition to the expenses which JCMthe Adviser may incur in the performance of its investment advisory functions and other services under this Agreement, and the expenses which it may expressly undertake to incur and pay under other agreements with the Trust or otherwise, the Adviser shall incur and pay the following expenses relating to the Fund’s operations without reimbursement from the Fund: | (a) | Reasonable compensation, fees and related expenses of the Trust’s officers and its Trustees, except for such Trustees who are not “interested persons,” as defined in the 1940 Act, of the Adviser, and except as otherwise provided in Section 7; |
| (b) | Rental of offices of the Trust; and |
| (c) | Fees of any subadviser engaged by the Adviser pursuant to the authority granted in Section 2 hereof. |
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[For Global Allocation Portfolio – Moderate] 6.Expenses Borne by the Adviser. In addition to the expenses which the Adviser may incur in the performance of its investment advisory functions and other services under this Agreement, and the expenses which it may expressly undertake to incur and pay under other agreements with the Trust or otherwise, JCM shall incur and pay the following expenses relating to the Fund'sFund’s operations without reimbursement from the Fund:
(a) Reasonable compensation, fees and related expenses of the Trust's | (a) | Reasonable compensation, fees and related expenses of the Trust’s officers and its Trustees, except for such Trustees who are not “interested persons,” as defined in the 1940 Act, of the Adviser, and except as otherwise provided in Section 7; Reasonable compensation, fees and related expenses of the Trust’s officers and its Trustees, except for such Trustees who are not “interested persons,” as defined in the 1940 Act, of JCM, and except as otherwise provided in Section 7; and |
| (b) | Rental of offices of the Trust. |
[For all Funds except Global Allocation Portfolio – Moderate:] 7.Expenses Borne by the Trust. The Trust assumes and shall pay all expenses incidental to its organization, operations and business not specifically assumed or agreed to be paid by the Adviser pursuant to Sections 3 and 6 hereof, including, but not limited to, investment adviser fees; any compensation, fees, or reimbursements which the Trust pays to its Trustees who are not "interested“interested persons,"” as defined in the 1940 Act, of JCM,the Adviser; compensation and except as
otherwise provided in Section 7; and
(b) Rental of officesrelated expenses of the Trust.
Chief Compliance Officer of the Trust and compliance staff, as authorized from time to time by the Trustees of the Trust; compensation (and any out-of-pocket expense as may be agreed upon) of the Fund’s custodian, transfer agent, administrator, fund accounting agent, registrar and dividend disbursing agent; legal, accounting, audit and printing expenses; administrative, clerical, recordkeeping and bookkeeping expenses; brokerage commissions and all other expenses in connection with execution of portfolio transactions (including any appropriate commissions paid to the Adviser, its affiliates, or other Fund service providers, for effecting exchange listed, over-the-counter or other securities transactions); interest; all federal, state and local taxes (including stamp, excise, income and franchise taxes); costs of stock certificates and expenses of delivering such certificates to purchasers thereof; expenses of local representation in Delaware; expenses of shareholders’ meetings and of preparing, printing and distributing proxy statements, notices, and reports to shareholders; expenses of preparing and filing reports and tax returns with federal and state regulatory authorities; all expenses incurred in complying with all federal and state laws and the laws of any foreign country applicable to the issue, offer, or sale of shares of the Fund, including, but not limited to, all costs involved in the registration or qualification of shares of the Fund for sale in any jurisdiction, the costs of portfolio pricing services and compliance systems, and all costs involved in preparing, printing and mailing prospectuses and statements of additional information to Fund shareholders; and all fees, dues and other expenses incurred by the Trust in connection with the membership of the Trust in any trade association or other investment company organization. To the extent that the Adviser shall perform any of the above described administrative and clerical functions, including transfer agency, registry, dividend disbursing, recordkeeping, bookkeeping, accounting and blue sky monitoring and registration functions, and the preparation of reports and returns, the Trust shall pay to the Adviser compensation for, or reimburse the Adviser for its expenses incurred in connection with, such services as the Adviser and the Trust shall agree from time to time, any other provision of this Agreement notwithstanding. [For Global Allocation Portfolio – Moderate] 7.Expenses Borne by the Trust.Trust. The Trust assumes and shall pay all expenses incidental to its organization, operations and business not specifically assumed or agreed to be paid by JCM pursuant to Sections 3 and 6 hereof, including, but not limited to, investment adviser fees; any compensation, fees, or reimbursements which the Trust pays to its Trustees who are not "interested“interested persons,"” as defined in the 1940 Act, of JCM; compensation and related expenses of the Chief Compliance Officer of the Trust and compliance staff, as authorized from time to time by the Trustees of the Trust; compensation of the Fund'sFund’s custodian, transfer agent, registrar and dividend disbursing agent; legal, accounting, audit and printing expenses; administrative, clerical, recordkeeping and bookkeeping expenses; brokerage commissions and all other expenses in connection with execution of portfolio L-4
transactions (including any appropriate commissions paid to JCM or its affiliates for effecting exchange listed, over-the-counterover the counter or other securities transactions); interest; all federal, state and local taxes (including stamp, excise, income and franchise taxes); costs of stock certificates and expenses of delivering such certificates to purchasers thereof; expenses of local representation in Delaware; expenses of shareholders'shareholders’ meetings and of preparing, printing and distributing proxy statements, notices, and reports to shareholders; expenses of preparing and filing reports and tax returns with federal and state regulatory authorities; all expenses incurred in complying with all federal and state laws and the laws of any foreign country applicable to the issue, offer, or sale of shares of the Fund, including, but not limited to, all costs involved in the registration or qualification of shares of the Fund for sale in any jurisdiction, the costs of portfolio pricing services and compliance systems, and all costs involved in preparing, printing and mailing prospectuses and statements of additional information to Fund shareholders; and all fees, dues and other expenses incurred by the Trust in connection with the membership of the Trust in any trade association or other investment company organization. To the extent that JCM shall perform any of the above described administrative and clerical functions, including transfer agency, registry, dividend disbursing, recordkeeping, bookkeeping, accounting and blue sky monitoring and registration functions, and the preparation of reports and returns, the Trust shall pay to JCM compensation for, or reimburse JCM for its expenses C-3
incurred in connection with, such services as JCM and the Trust shall agree from time to time, any other provision of this Agreement notwithstanding.” 8. Termination.Termination. This Agreement may be terminated at any time, without penalty, by the Trustees of the Trust, or by the shareholders of the Fund acting by vote of at least a majority of its outstanding voting securities, provided in either case that sixty (60) days advance written notice of termination be given to JCMthe Adviser at its principal place of business. This Agreement may be terminated by JCMthe Adviser at any time, without penalty, by giving sixty (60) days advance written notice of termination to the Trust, addressed to its principal place of business. The Trust agrees that, consistent with the terms of the Trust Instrument, the Trust shall cease to use the name "Janus"“Janus” in connection with the Fund as soon as reasonably practicable following any termination of this Agreement if JCMthe Adviser does not continue to provide investment advice to the Fund after such termination. 9. Assignment.Assignment. This Agreement shall terminate automatically in the event of any assignment of this Agreement. 10. Term.Term. This Agreement shall continue in effect until February[February 1, [2007][2011]2018], unless sooner terminated in accordance with its terms, and shall continue in effect from year to year thereafter only so long as such continuance is specifically approved at least annually by (a) the vote of a majority of the Trustees of the Trust who are not parties hereto or interested persons of any such party, cast in person at a meeting called for the purpose of voting on the approval of the terms of such renewal, and (b) either the Trustees of the Trust or the affirmative vote of a majority of the outstanding voting securities of the Fund. The annual approvals provided for herein shall be effective to continue this Agreement from year to year if given within a period beginning not more than ninety (90) days prior to February 1 of each applicable year, notwithstanding the fact that more than three hundred sixty-five (365) days may have elapsed since the date on which such approval was last given. 11. Amendments.Amendments. This Agreement may be amended by the parties only if such amendment is specifically approved (i) by a majority of the Trustees, including a majority of the Trustees who are not interested persons (as that phrase is defined in Section 2(a)(19) of the 1940 Act) of any party to this Agreement, and (ii) if required by applicable law, (ii) by the affirmative vote of a majority of the outstanding voting securities of the Fund (as that phrase is defined in Section 2(a)(42) of the 1940 Act). 12.Other Series.Series. The Trustees shall determine the basis for making an appropriate allocation of the Trust'sTrust’s expenses (other than those directly attributable to the Fund) between the Fund and the other series of the Trust. 13.Limitation of Personal Liability.Liability. All the parties hereto acknowledge and agree that all liabilities of the Trust arising, directly or indirectly, under this Agreement, of any and every nature whatsoever, shall be satisfied solely out of the assets of the Fund and that no Trustee, officer or holder of shares of beneficial interest of the Trust shall be personally liable for any of the foregoing liabilities. The Trust Instrument describes in detail the respective responsibilities and limitations on liability of the Trustees, officers and holders of shares of beneficial interest of the Trust.
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14.Limitation of Liability of JCM. JCMthe Adviser. The Adviser shall not be liable for any error of judgment or mistake of law or for any loss arising out of any investment or for any act or omission taken with respect to the Trust, except for willful misfeasance, bad faith or gross negligence in the performance of its duties, or by reason of reckless disregard of its obligations and duties hereunder and except to the extent otherwise provided by law. As used in this Section 14, "JCM"the “Adviser” shall include any affiliate of JCMthe Adviser performing services for the Trust contemplated hereunder and directors, officers and employees of JCMthe Adviser and such affiliates. 15.Activities of JCM.the Adviser. The services of JCMthe Adviser to the Trust hereunder are not to be deemed to be exclusive, and JCMthe Adviser 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 JCMthe Adviser as directors, officers and shareholders of JCM,the Adviser, that directors, officers, employees and shareholders of JCMthe Adviser are or may become similarly interested in the Trust, and that JCMthe Adviser may become interested in the Trust as a shareholder or otherwise. 16.Certain Definitions.Definitions. The terms "vote“vote of a majority of the outstanding voting securities," "assignment"” “assignment” and "interested persons"“interested persons” when used herein, shall have the respective meanings specified in the 1940 Act, as now in effect or hereafter amended, and the rules and regulations thereunder, subject to such orders, exemptions and interpretations as may be issued by the Securities and Exchange Commission under said Act and as may be then in effect. 17.Governing Law.Law. This Agreement shall be construed in accordance with the laws of the State of Colorado (without giving effect to the conflicts of laws principles thereof) and the 1940 Act. To the extent that the applicable laws of the State of Colorado conflict with the applicable provisions of the 1940 Act, the latter shall control.
This Agreement shall supercede all prior investment advisory agreements
entered into between JCM and the Trust, on behalf [Remainder of the Fund.
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IN WITNESS WHEREOF, the parties have caused their duly authorized officers to execute this Investment Advisory Agreement as of the amended date and year first above written. | | | [JANUS HENDERSON CAPITAL MANAGEMENT LLC] | | | By: | | | Name: | | | Title: | | |
| | | JANUS ASPEN SERIES | | | By: | | | Name: | | | Title: | | |
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JANUS CAPITAL MANAGEMENT LLC
By:
------------------------------------ASPEN SERIES PROPOSED INVESTMENT ADVISORY AGREEMENT FORTY PORTFOLIO GLOBAL RESEARCH PORTFOLIO JANUS PORTFOLIO OVERSEAS PORTFOLIO JANUS ASPEN PERKINS MID CAP VALUE PORTFOLIO THIS INVESTMENT ADVISORY AGREEMENT (the “Agreement”) is made thisday of, 2017 between JANUS ASPEN SERIES, By:
------------------------------------
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[SCHEDULE A
PERFORMANCE ADJUSTMENT]
[Beginninga Delaware statutory trust (the “Trust”), and [JANUS HENDERSON CAPITAL MANAGEMENT LLC], a Delaware limited liability company (the “Adviser”). W I T N E S S E T H: WHEREAS, the Trust is registered as an open-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”), and has registered its shares for public offering under the Securities Act of 1933, as amended (the “1933 Act”); and WHEREAS, the Trust is authorized to create separate funds, each with its own separate investment portfolio of which the beneficial interests are represented by a separate series of shares; one of such funds created by the Trust being designated as the [Forty Portfolio] [Global Research Portfolio] [Janus Portfolio] [Overseas Portfolio] [Janus Aspen Perkins Mid Cap Value Portfolio] (the “Fund”); and WHEREAS, the Trust and the Adviser deem it mutually advantageous that the Adviser should be appointed as the investment adviser to the Fund. NOW, THEREFORE, the parties agree as follows: 1.Appointment. The Trust hereby appoints the Adviser as investment adviser and manager with respect to the Fund for the period and on the terms set forth in this Agreement. The Adviser hereby accepts such appointment and agrees to render the services herein set forth, for the compensation herein provided. 2.Investment Advisory Services. The Adviser shall determine the securities or other assets to be purchased, sold or held and shall place orders for the purchase or sale of such securities or other assets with brokers, dealers or others. The Adviser shall furnish continuous advice and recommendations to the Fund, and have authority to act with respect thereto, as to the acquisition, holding, or disposition of any or all of the securities or other assets which the Fund may own or contemplate acquiring from time to time. The Adviser shall give due consideration to the investment policies and restrictions and the other statements concerning the Fund in the Amended and Restated Trust Instrument (“Trust Instrument”), Bylaws, and registration statements under the 1940 Act and the 1933 Act, and to the provisions of the Internal Revenue Code, as amended from time to time, applicable to the Fund as a regulated investment company and as a funding vehicle for variable insurance contracts. In addition, the Adviser shall cause its officers to attend meetings and furnish oral or written reports, as the Trust may reasonably require, in order to keep the Trustees and appropriate officers of the Trust fully informed as to the condition of the investment portfolio of the Fund. [Subject to the approval of the Trustees of the Trust and, if required, the shareholders of the Fund, the Adviser is authorized to engage one or more subadvisers in connection with the Adviser’s duties and responsibilities under this Agreement, which subadvisers may be, but are not required to be, affiliates of the Adviser.2] 2 | This text does not appear in each Fund’s Investment Advisory Agreement, but will be included in it to the extent that a Fund’s shareholders approve Proposal 5, the Manager of Managers Proposal, included in this Proxy Statement. |
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3.Other Services. The Adviser is hereby authorized (to the extent the Trust has not otherwise contracted) but not obligated (to the extent it so notifies the Trustees at least 60 days in advance), to perform (or arrange for the performance by other service providers, including affiliates of, independent third party service providers, or duly appointed subadvisers whether affiliated or not) the management and administration services necessary for the operation of the Fund. The Adviser is specifically authorized, on behalf of the Trust and the Fund, to conduct relations with custodians, depositories, transfer and pricing agents, administrators, fund accounting agents, accountants, attorneys, underwriters, brokers and dealers, corporate fiduciaries, insurance company separate accounts, insurers, banks, agents, and such other persons in any such other capacity deemed by the Adviser and/or the Trustees to be necessary or desirable. To the extent the Trust has not otherwise contracted on behalf of the Fund, the Adviser shall generally monitor and report to Fund officers the Fund’s compliance with investment policies and restrictions as set forth in the currently effective prospectus and statement of additional information relating to the shares of the Fund under the 1933 Act. The Adviser shall make reports to the Trustees of its performance of services hereunder upon request therefor and furnish advice and recommendations with respect to such other aspects of the business and affairs of the Fund as it shall determine to be desirable. The Adviser is also authorized, subject to review by the Trustees, to furnish such other services as the Adviser shall from time to time determine to be necessary or useful to perform the services contemplated by this Agreement to the extent such services are not otherwise contracted by the Trust, on behalf of the Fund. 4.Obligations of Trust. The Trust shall have the following obligations under this Agreement: | (a) | to keep the Adviser continuously and fully informed as to the composition of its investment portfolio and the nature of all of its assets and liabilities from time to time; |
| (b) | to furnish the Adviser with a certified copy of any financial statement or report prepared for it by certified or independent public accountants and with copies of any financial statements or reports made to its shareholders or to any governmental body or securities exchange; |
| (c) | to furnish the Adviser with any further materials or information which the Adviser may reasonably request to enable it to perform its function under this Agreement; and |
| (d) | to compensate the Adviser for its services and reimburse the Adviser for its expenses incurred hereunder in accordance with the provisions hereof. |
5.Compensation. [For Forty Portfolio, Janus Portfolio, Overseas Portfolio, and Janus Aspen Perkins Mid Cap Value Portfolio:] The Trust shall pay to the Adviser for its services pursuant to this Agreement a monthly base fee of 1/12 of 0.64% of the average daily closing net asset value of the Fund (“Base Fee”) adjusted by a performance fee as set forth in Schedule A. For any period less than a month during which this Agreement is in effect, the Base Fee payableshall be prorated according to the proportion which such period bears to a full month of 28, 29, 30 or 31 days, as the case may be. [For Global Research Portfolio:] The Trust shall pay to the Adviser for July 2010its services pursuant to this Agreement a monthly base fee of 1/12 of 0.60% of the average daily closing net asset value of the Fund (“Base Fee”), adjusted by a performance fee as set forth in Schedule A. For any period less than a month during which this Agreement is in effect, the Base Fee shall be prorated according to the proportion which such period bears to a full month of 28, 29, 30 or 31 days, as the case may be. 6.Expenses Borne by the Adviser. In addition to the expenses which the Adviser may incur in the performance of its investment advisory functions and other services under this Agreement, and the expenses which it may expressly undertake to incur and pay under other agreements with the Trust or otherwise, the Adviser shall incur and pay the following expenses relating to the Fund’s operations without reimbursement from the Fund: | (a) | Reasonable compensation, fees and related expenses of the Trust’s officers and its Trustees, except for such Trustees who are not “interested persons,” as defined in the 1940 Act, of the Adviser, and except as otherwise provided in Section 7; |
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| (b) | Rental of offices of the Trust; and |
| (c) | Fees of any subadviser engaged by the Adviser pursuant to the authority granted in Section 2 hereof. |
7.Expenses Borne by the Trust. The Trust assumes and shall pay all expenses incidental to its organization, operations and business not specifically assumed or agreed to be paid by the Adviser pursuant to Sections 3 and 6 hereof, including, but not limited to, investment adviser fees; any compensation, fees, or reimbursements which the Trust pays to its Trustees who are not “interested persons,” as defined in [JANUS
PORTFOLIO - MONTH 13] [OVERSEAS PORTFOLIO - MONTH 16] [FORTY PORTFOLIO - MONTH
19]the 1940 Act, of the Adviser; compensation and related expenses of the Chief Compliance Officer of the Trust and compliance staff, as authorized from time to time by the Trustees of the Trust; compensation (and any out-of-pocket expense as may be agreed upon) of the Fund’s custodian, transfer agent, administrator, fund accounting agent, registrar and dividend disbursing agent; legal, accounting, audit and printing expenses; administrative, clerical, recordkeeping and bookkeeping expenses; brokerage commissions and all other expenses in connection with execution of portfolio transactions (including any appropriate commissions paid to the Adviser, its affiliates, or other Fund service providers, for effecting exchange listed, over-the-counter or other securities transactions); interest; all federal, state and local taxes (including stamp, excise, income and franchise taxes); costs of stock certificates and expenses of delivering such certificates to purchasers thereof; expenses of local representation in Delaware; expenses of shareholders’ meetings and of preparing, printing and distributing proxy statements, notices, and reports to shareholders; expenses of preparing and filing reports and tax returns with federal and state regulatory authorities; all expenses incurred in complying with all federal and state laws and the laws of any foreign country applicable to the issue, offer, or sale of shares of the Fund, including, but not limited to, all costs involved in the registration or qualification of shares of the Fund for sale in any jurisdiction, the costs of portfolio pricing services and compliance systems, and all costs involved in preparing, printing and mailing prospectuses and statements of additional information to Fund shareholders; and all fees, dues and other expenses incurred by the Trust in connection with the membership of the Trust in any trade association or other investment company organization. To the extent that the Adviser shall perform any of the above described administrative and clerical functions, including transfer agency, registry, dividend disbursing, recordkeeping, bookkeeping, accounting and blue sky monitoring and registration functions, and the preparation of reports and returns, the Trust shall pay to the Adviser compensation for, or reimburse the Adviser for its expenses incurred in connection with, such services as the Adviser and the Trust shall agree from time to time, any other provision of this Agreement notwithstanding. 8.Termination. This Agreement may be terminated at any time, without penalty, by the Trustees of the Trust, or by the shareholders of the Fund acting by vote of at least a majority of its outstanding voting securities, provided in either case that sixty (60) days advance written notice of termination be given to the Adviser at its principal place of business. This Agreement may be terminated by the Adviser at any time, without penalty, by giving sixty (60) days advance written notice of termination to the Trust, addressed to its principal place of business. The Trust agrees that, consistent with the terms of the Trust Instrument, the Trust shall cease to use the name “Janus” in connection with the Fund as soon as reasonably practicable following any termination of this Agreement if the Adviser does not continue to provide investment advice to the Fund after such termination. 9.Assignment. This Agreement shall terminate automatically in the event of any assignment of this Agreement. 10.Term. This Agreement shall continue in effect until [February 1, 2018], unless sooner terminated in accordance with its terms, and shall continue in effect from year to year thereafter only so long as such continuance is specifically approved at least annually by (a) the vote of a majority of the Trustees of the Trust who are not parties hereto or interested persons of any such party, cast in person at a meeting called for the purpose of voting on the approval of the terms of such renewal, and (b) either the Trustees of the Trust or the affirmative vote of a majority of the outstanding voting securities of the Fund. The annual approvals provided for herein shall be effective to continue this Agreement from year to year if given within a period beginning not more than ninety (90) days prior to February 1 of each applicable year, notwithstanding the fact that more than three hundred sixty-five (365) days may have elapsed since the date on which such approval was last given. L-10
11.Amendments. This Agreement may be amended by the parties only if such amendment is specifically approved (i) by a majority of the Trustees, including a majority of the Trustees who are not interested persons (as that phrase is defined in Section 2(a)(19) of the 1940 Act) of any party to this Agreement, and (ii) if required by applicable law, by the affirmative vote of a majority of the outstanding voting securities of the Fund (as that phrase is defined in Section 2(a)(42) of the 1940 Act). 12.Other Series. The Trustees shall determine the basis for making an appropriate allocation of the Trust’s expenses (other than those directly attributable to the Fund) between the Fund and the other series of the Trust. 13.Limitation of Personal Liability. All the parties hereto acknowledge and agree that all liabilities of the Trust arising, directly or indirectly, under this Agreement, of any and every nature whatsoever, shall be satisfied solely out of the assets of the Fund and that no Trustee, officer or holder of shares of beneficial interest of the Trust shall be personally liable for any of the foregoing liabilities. The Trust Instrument describes in detail the respective responsibilities and limitations on liability of the Trustees, officers and holders of shares of beneficial interest of the Trust. 14.Limitation of Liability of the Adviser. The Adviser shall not be liable for any error of judgment or mistake of law or for any loss arising out of any investment or for any act or omission taken with respect to the Trust, except for willful misfeasance, bad faith or gross negligence in the performance of its duties, or by reason of reckless disregard of its obligations and duties hereunder and except to the extent otherwise provided by law. As used in this Section 14, the “Adviser” shall include any affiliate of the Adviser performing services for the Trust contemplated hereunder and directors, officers and employees of the Adviser and such affiliates. 15.Activities of the Adviser. The services of the Adviser to the Trust hereunder are not to be deemed to be exclusive, and the Adviser 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 the Adviser as directors, officers and shareholders of the Adviser, that directors, officers, employees and shareholders of the Adviser are or may become similarly interested in the Trust, and that the Adviser may become interested in the Trust as a shareholder or otherwise. 16.Certain Definitions. The terms “vote of a majority of the outstanding voting securities,” “assignment” and “interested persons” when used herein, shall have the respective meanings specified in the 1940 Act, as now in effect or hereafter amended, and the rules and regulations thereunder, subject to such orders, exemptions and interpretations as may be issued by the Securities and Exchange Commission under said Act and as may be then in effect. 17.Governing Law. This Agreement shall be construed in accordance with the laws of the State of Colorado (without giving effect to the conflicts of laws principles thereof) and the 1940 Act. To the extent that the applicable laws of the State of Colorado conflict with the applicable provisions of the 1940 Act, the latter shall control. [Remainder of page intentionally left blank.] L-11
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 HENDERSON CAPITAL MANAGEMENT LLC] | | | By: | | | Name: | Title: |
| | | JANUS ASPEN SERIES | | | By: | | | Name: | Title: |
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Schedule A Performance Adjustment The Base Fee shall be adjusted monthly based upon the investment performance of the Fund'sFund’s Service Shares ("Class"(“Class”) in relation to the cumulative investment record of the Fund'sFund’s benchmark,[For Forty Portfolio: the [JANUS PORTFOLIO AND FORTY
PORTFOLIO - RUSSELL 1000((R)) GROWTH INDEX (THE "INDEX")Russell 1000® Growth Index] [For Global Research Portfolio: the MSCI World IndexSM] [OVERSEAS
PORTFOLIO - MORGAN STANLEY CAPITAL INTERNATIONAL ALL COUNTRY WORLD EX-U.S.
INDEX(SM)[For Janus Portfolio: the Core Growth Index] [For Overseas Portfolio: the MSCI All Country World ex-U.S. IndexSM] [For Janus Aspen Perkins Mid Cap Value Portfolio: the Russell Midcap® Value Index](THE "INDEX"the “Index”)], over the "Performance Period"“Performance Period” (such adjustment being referred to herein as the "Performance Adjustment"“Performance Adjustment”). The "Performance Period"“Performance Period” is defined as the shorter of (a) the period from the date of this Agreement through
the end of the month for which the fee is being calculated, and (b) the 36 month period preceding the end of the month for which the fee is being calculated. [For Janus Portfolio:]
[The The Index consists of an equal weighting (balanced daily) of two benchmark indices, the Standard & Poor’s 500® Index (“S&P 500® Index”) and the Russell 1000® Growth Index. The Index performance for the Performance Period is calculated based on the equally weighted total returns from the Russell 1000® Growth Index (50%) and the S&P 500® Index (50%). The Performance Adjustment shall be calculated by subtracting the investment record of the Index from the investment performance of the Class. If there is less than a 0.50% difference (plus or minus) between the investment performance of the Class and the investment record of the Index, the Fund pays JCMthe Adviser the Base Fee with no adjustment. If the difference between the investment performance of the Class and the investment record of the Index is 0.50% or greater during any Performance Period, the Base Fee will be subject to an upward or downward performance adjustment of [JANUS PORTFOLIO -[For Forty Portfolio: 1/12 OFof 0.0088235%] [For Global Research Portfolio: 1/12 of 0.0125%] [For Janus Portfolio: 1/12 of 0.016667%] [For Overseas Portfolio: 1/12 of 0.0107143%] [For Janus Aspen Perkins Mid Cap Value Portfolio: 1/12 of 0.01875%]
[FORTY PORTFOLIO - 1/12 OF 0.0088235%] [OVERSEAS PORTFOLIO - 1/12 OF 0.0107143%]
for every full 0.50% increment by which the Class outperforms or underperforms the Index. The maximum percentage used in calculating the Performance Adjustment (positive or negative) in any month is 1/12 of 0.15%. The Performance Adjustment is applied against the Fund'sFund’s average daily net assets during the Performance Period.]
[For For purposes of computing the Base Fee and the Performance Adjustment, net assets are averaged over different periods (average daily net assets during the relevant month for the Base Fee versus average daily net assets during the Performance Period for the Performance Adjustment). The Base Fee is calculated and accrued daily. The Performance Adjustment is calculated monthly in arrears and is accrued daily, beginning no later than the second business day of the month, and thereafter, the amount is distributed evenly each day throughout the month. The investment advisory fee is paid monthly in arrears.]
[The The average daily net asset value of the Fund, or any class thereof, shall be determined in the manner set forth in the Trust's Amended and RestatedTrust’s Trust Instrument, Bylaws and registration statement, each as may be amended from time to time.]
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[The investment performance of the Class will be the sum of:]
[(1) the change in the Class' net asset value ("NAV") per share during the
Performance Period; plus]
[(2) the value of the Class' cash distributions per share accumulated to
the end of the Performance Period; plus]
[(3) | The | investment performance of the Class will be the sum of: |
| (1) | the change in the Class’ net asset value (“NAV”) per share during the Performance Period; plus |
| (2) | the value of the Class’ cash distributions per share accumulated to the end of the Performance Period; plus |
(3) the value of capital gains taxes per share paid or payable on undistributed realized long-term capital gains accumulated to the end of the Performance Period;]
[expressed expressed as a percentage of the Class'Class’ NAV per share at the beginning of the Performance Period. For this purpose, the value of distributions per share of realized capital gains, of dividends per share paid from investment income and of capital gains taxes per share paid or payable on undistributed realized long-
termlong-term capital gains shall be treated as reinvested in shares of the Class at the NAV in effect at the close of business on the record date for the payment of such distributions and dividends and the date on which provision is made for such taxes, after giving effect to such distributions, dividends and taxes.]
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The investment record of the Index will be the sum of: [For all Funds except Janus Portfolio:]
[(1) (1) the change in the level of the Index during the Performance Period; plus]
[(2)plus (2) the value, computed consistently with the Index, of cash distributions made by companies whose securities comprise the Index accumulated to the end of the Performance Period; expressed as a percentage of the Index level at the beginning of the Performance Period. For this purpose, cash distributions on the securities which comprise the Index shall be treated as reinvested in the Index at least as frequently as the end of each calendar quarter following the payment of the dividend. [For Janus Portfolio:]
[The (1) the change in the level of the Index during the Performance Period, which is an equal weighting of the change in the level of the underlying indices during the Performance Period; plus (2) the value, computed consistently with the Index, of cash distributions made by companies whose securities comprise the Index (50% of the S&P 500® Index and 50% of the Russell 1000® Growth Index) accumulated to the end of the Performance Period; expressed as a percentage of the Index level at the beginning of the Performance Period. For this purpose, cash distributions on the securities which comprise the Index shall be treated as reinvested in the Index at least as frequently as the end of each calendar quarter following the payment of the dividend. The Trustees have initially designated the Class to be used for purposes of determining the Performance Adjustment. From time to time, the Trustees may, by vote of the Trustees of the Trust voting in person, including a majority of the Trustees who are not parties to this Agreement or "interested persons"“interested persons” (as defined in the 1940 Act) of any such parties, determine that a class of shares of the Fund other than the Class is the most appropriate for use in calculating the Performance Adjustment. If a different class of shares ("(“Successor Class"Class”) is substituted in calculating the Performance Adjustment, the use of that Successor Class of shares for purposes of calculating the Performance Adjustment may apply to the entire Performance Period so long as such Successor Class was outstanding at the beginning of such period. If the Successor Class of shares was not outstanding for all or a portion of the Performance Period, it may only be used in calculating that portion of the Performance Adjustment attributable to the period during which such Successor Class was outstanding and any prior portion of the Performance Period shall be calculated using the class of shares previously designated.]
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APPENDIX D
OTHER FUNDS MANAGED BY L-14
Appendix M Form of New INTECH Sub-Advisory Agreement PROPOSED SUB-ADVISORY AGREEMENT JANUS ASPEN INTECH U.S. LOW VOLATILITY PORTFOLIO (a Series of Janus Aspen Series) This SUB-ADVISORY AGREEMENT (the “Agreement”) is entered into effective as of the, 2017, by and between [JANUS HENDERSON CAPITAL WITH SIMILARMANAGEMENT LLC], a Delaware limited liability company (the “Adviser”) and INTECH INVESTMENT OBJECTIVESMANAGEMENT LLC, a Delaware limited liability company (“INTECH”). WHEREAS, the Adviser has entered into an Investment Advisory Agreement (the “Advisory Agreement”) with Janus Aspen Series, a Delaware statutory trust (the “Trust”) and an open-end, management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”), with respect to Janus Aspen INTECH U.S. Low Volatility Portfolio, a series of the Trust (the “Fund”) pursuant to which the Adviser has agreed to provide investment advisory services with respect to the Fund; and WHEREAS, INTECH is engaged in the business of rendering investment advisory services and is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”); and WHEREAS, the Adviser desires to retain INTECH to furnish investment advisory services with respect to the Fund, and INTECH is willing to furnish such services; NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Duties of INTECH. The Adviser hereby engages the services of INTECH as subadviser in furtherance of the Advisory Agreement. INTECH agrees to perform the following table lists certainduties, subject to the oversight of the Adviser and to the overall control of the officers and the Board of Trustees (the “Trustees”) of the Trust: (a) INTECH shall manage the investment operations of the Fund and the composition of its investment portfolio, shall determine without prior consultation with the Trust or the Adviser, what securities and other assets of the Fund will be acquired, held, disposed of or loaned, and place orders, or direct the Adviser to place orders, for the purchase or sale of such securities or other assets with brokers, dealers or others, all in conformity with the investment objectives, policies and restrictions and the other statements concerning the Fund in the Trust’s trust instrument, as amended from time to time (the “Trust Instrument”), bylaws and registration statements under the 1940 Act and the Securities Act of 1933, as amended (the “1933 Act”), the Advisers Act, the rules thereunder and all other applicable federal and state laws and regulations, and the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), applicable to the Trust, on behalf of the Fund, as a regulated investment company; (b) INTECH shall cause its officers to attend meetings and furnish oral or written reports, as the Trust or the Adviser may reasonably require, in order to keep the Adviser, the Trustees and appropriate officers of the Trust fully informed as to the condition of the investment portfolio of the Fund, the investment decisions of INTECH, and the investment considerations which have given rise to those decisions; (c) INTECH shall maintain all books and records required to be maintained by INTECH pursuant to the 1940 Act, the Advisers Act, and the rules and regulations promulgated thereunder, as the same may be amended from time to time, with respect to transactions on behalf of the Fund, and shall furnish the Trustees and the Adviser with such periodic and special reports as the Trustees or the Adviser reasonably may request. INTECH hereby agrees that all records which it maintains for the Fund or the Trust are the property of the Trust, agrees to permit the reasonable inspection thereof by the Trust or its designees and agrees to preserve for the periods prescribed under the 1940 Act and the Advisers Act any records which it maintains for the Trust and which are required to be maintained under the 1940 Act and the Advisers Act, and further agrees to surrender promptly to the Trust or its designees any records which it maintains for the Trust upon request by the Trust; M-1
(d) INTECH shall submit such reports relating to the valuation of the Fund’s assets and to otherwise assist in the calculation of the net asset value of shares of the Fund as may reasonably be requested; (e) INTECH shall exercise, and/or provide the Adviser with such assistance and advice as the Adviser may reasonably request as to the manner in which to exercise, on behalf of the Fund, exercise such voting rights, subscription rights, rights to consent to corporate action and any other rights pertaining to the Fund’s assets that may be exercised, in accordance with any policy pertaining to the same that may be adopted or agreed to by the Trustees of the Trust, so that the Adviser may exercise such rights, as needed, or, in the event that the Trust retains the right to exercise such voting and other rights, to furnish the Trust with advice as may reasonably be requested as to the manner in which such rights should be exercised; (f) At such times as shall be reasonably requested by the Trustees or the Adviser, INTECH shall provide the Trustees and the Adviser with economic, operational and investment data and reports, including without limitation all information regarding funds withand materials reasonably requested by or requested to be delivered to the Trustees of the Trust pursuant to Section 15(c) of the 1940 Act, and shall make available to the Trustees and the Adviser any economic, statistical and investment services normally available to similar investment objectivescompany clients of INTECH; and (g) INTECH will provide to the Adviser for regulatory filings and other appropriate uses materially accurate and complete information relating to INTECH as may be reasonably requested by the Adviser from time to time and, notwithstanding anything herein to the contrary, INTECH shall be liable to the Adviser for all damages, costs and expenses, including without limitation reasonable attorney’s fees (hereinafter referred to collectively as “Damages”), incurred by the Adviser as a result of any material inaccuracies or omissions in such information provided by INTECH to the Adviser, provided, however, that INTECH shall not be liable to the extent that any Damages are based upon inaccuracies or omissions made in reliance upon information furnished to INTECH by the Adviser. 2. Further Obligations. In all matters relating to the performance of this Agreement, INTECH shall act in conformity with the Trust’s Trust Instrument, bylaws and currently effective registration statements under the 1940 Act and the 1933 Act and any amendments or supplements thereto (the “Registration Statements”) and with the written policies, procedures and guidelines of the Fund, and written instructions and directions of the Trustees and the Adviser and shall comply with the requirements of the 1940 Act, the Advisers Act, the rules thereunder, and all other applicable federal and state laws and regulations. The Adviser agrees to provide to INTECH copies of the Trust’s Trust Instrument, bylaws, Registration Statement, written policies, procedures and guidelines and written instructions and directions of the Trustees and the Adviser, and any amendments or supplements to any of them at, or, if practicable, before the time such materials become effective. 3. Obligations of the Adviser. The Adviser shall have the following obligations under this Agreement: (a) To keep INTECH continuously and fully informed (or cause the custodian of the Fund’s assets to keep INTECH so informed) as to the composition of the investment portfolio of the Fund and the nature of all of the Fund’s assets and liabilities from time to time; (b) To furnish INTECH 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; (c) To furnish INTECH with any further materials or information which Janus Capital provides investment advisoryINTECH may reasonably request to enable it to perform its function under this Agreement; and (d) To compensate INTECH for its services in accordance with the provisions of Section 4 hereof. M-2
4. Compensation. The Adviser shall pay to INTECH for its services under this Agreement a fee calculated and payable for each day that this Agreement is in effect, of 1/365 of 0.25% of the average daily closing net asset value of the Fund (1/366 of 0.25% of the average daily closing net asset value of the Fund in a leap year) (net of any reimbursement of expenses incurred, fees waived by the Adviser, or subadvisory services. The table showsany recoupment of such fund's asset sizereimbursement or fee reduction, each of which are shared equally between the Adviser and INTECH). Fees paid to INTECH shall be computed and accrued daily and payable monthly as of December 31,
2009, the ratelast day of compensation paideach month during which or part of which this Agreement is in effect. 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. 5. Expenses. INTECH shall pay all its own costs and expenses incurred in rendering its service under this Agreement. 6. Representations of INTECH. INTECH hereby represents, warrants and covenants to the Adviser as follows: (a) INTECH: (i) is registered as an investment adviser under the Advisers Act and will continue to be so registered for so long as this Agreement remains in effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from performing the services contemplated by this Agreement; (iii) has met, and will continue to meet for so long as this Agreement remains in effect, any other applicable federal or state requirements, or the applicable requirements of any regulatory or industry self-regulatory organization necessary to be met in order to perform the services contemplated by this Agreement; (iv) has the legal and corporate authority to enter into and perform the services contemplated by this Agreement; and (v) will immediately notify the Adviser of the occurrence of any event that fund,would disqualify INTECH from serving as an investment adviser of an investment company pursuant to Section 9(a) of the 1940 Act or otherwise, and whether Janus Capitalof the institution of any administrative, regulatory or judicial proceeding against INTECH that could have a material adverse effect upon INTECH’s ability to fulfill its obligations under this Agreement. (b) INTECH has contractually agreedadopted a written code of ethics complying with the requirements of Rule 17j-1 under the 1940 Act and, to waive or reduce compensation receivedthe extent it is a separate Code of Ethics from that fund.
[To Be Updated]
CONTRACTUAL
INVESTMENT
ASSET SIZE ADVISORY FEE
(IN $ FEES/BASE FEES WAIVERS OR
FUND* OBJECTIVE MILLIONS) (ANNUAL RATE) REDUCTIONS
----- ----------------------------------- ---------- -------------- ----------
Balanced Portfolio............ Seeks long-term capital growth, 0.55% N/A
consistent with preservation of
capital and balanced by current
income.
Enterprise Portfolio.......... Seeks long-term growth of capital. 0.64% N/A
Global Technology Portfolio... Seeks long-term growth of capital. 0.64% 0.95%(1)
INTECH Risk-Managed Core
Fund(2)..................... Seeks long-term growth of capital. 0.50%(3) 0.89%(4)
INTECH Risk-Managed Growth
Fund(2)..................... Seeks long-term growth of capital. 0.50% 0.90%(4)
INTECH Risk-Managed
International Fund(2)....... Seeks long-term growth of capital. 0.55% 1.00%(4)
INTECH Risk-Managed Value
Fund(2)..................... Seeks long-term growth of capital. 0.50% 0.75%(4)
Janus Balanced Fund........... Seeks long-term capital growth, 0.55% 0.76%(4)
consistent with preservation of
capital and balanced by current
income.
Janus Contrarian Fund......... Seeks long-term growth of capital. 0.64%(3) 0.89%(4)
Janus Enterprise Fund......... Seeks long-term growth of capital. 0.64% 0.90%(4)
Janus Forty Fund.............. Seeks long-term growth of capital. 0.64% 0.78%(4)
Janus Fund.................... Seeks long-term growth of capital. 0.64% 0.78%(4)
Janus Global Life Sciences
Fund........................ Seeks long-term growth of capital. 0.64% N/A
Janus Global Opportunities
Fund........................ Seeks long-term growth of capital. 0.64% N/A
Janus Global Research Fund.... Seeks long-term growth of capital. 0.64%(3) 1.00%(4)
Janus Global Technology Fund.. Seeks long-term growth of capital. 0.64% N/A
Janus Growth and Income Fund.. Seeks long-term capital growth and 0.62% 0.73%(4)
current income.
Janus International Equity
Fund........................ Seeks long-term growth of capital. 0.68%(3) 1.25%(4)
Janus International Forty
Fund........................ Seeks long-term growth of capital. 0.73%(3) 1.25%(4)
Janus Modular Portfolio
Construction Fund........... Seeks long-term growth of capital 0.07% 0.45%(4)
with a secondary emphasis on
income.
Janus Orion Fund.............. Seeks long-term growth of capital. 0.64% 0.90%(4)
Janus Overseas Fund........... Seeks long-term growth of capital. 0.64% 0.92%(4)
Janus Research Core Fund...... Seeks long-term growth of capital. 0.60% 0.66%(4)
Janus Research Fund........... Seeks long-term growth of capital. 0.64%(3) N/A
D-1
CONTRACTUAL
INVESTMENT
ASSET SIZE ADVISORY FEE
(IN $ FEES/BASE FEES WAIVERS OR
FUND* OBJECTIVE MILLIONS) (ANNUAL RATE) REDUCTIONS
----- ----------------------------------- ---------- -------------- ----------
Janus Smart
Portfolio - Conservative.... Seeks the highest return over time 0.05% 0.40%(5)
consistent with a primary emphasis
on income and a secondary emphasis
on growth of capital.
Janus Smart
Portfolio - Growth.......... Seeks the highest return over time 0.05% 0.45%(5)
consistent with a primary emphasis
on growth of capital and a
secondary emphasis on income.
Janus Smart
Portfolio - Moderate........ Seeks the highest return over time 0.05% 0.39%(5)
consistent with an emphasis on
growth of capital and income.
Janus Triton Fund............. Seeks long-term growth of capital. 0.64% 1.05%(4)
Janus Twenty Fund............. Seeks long-term growth of capital. 0.64% N/A
Janus Worldwide Fund.......... Seeks long-term growth of capital 0.60%(3) 1.00%(4)
in a manner consistent with the
preservation of capital.
Worldwide Portfolio........... Seeks long-term growth of capital 0.60%(3) N/A
in a manner consistent with the
preservation of capital.
AXA Multimanager Large Cap
Core Equity Portfolio....... Seeks long-term capital growth. N/A
ING Janus Contrarian
Portfolio................... Seeks long-term growth of capital. N/A
Lincoln Janus Capital
Appreciation Fund........... Seeks long-term growth of capital. N/A
Maxim Janus Large Cap Growth
Portfolio................... Seeks long-term growth of capital. N/A
Met Janus Forty Portfolio..... Seeks long-term growth of capital. N/A
Northwestern Mutual Focused
Appreciation Portfolio...... Seeks long-term growth of capital. N/A
Northwestern Mutual
International Growth
Portfolio................... Seeks long-term growth of capital. N/A
Ohio National Aggressive
Growth Portfolio............ Seeks long-term growth of capital. N/A
Pacific Life Growth LT Fund... Seeks long-term growth of capital. N/A
Pacific Select Focused 30
Portfolio................... Seeks long-term growth of capital. N/A
Pacific Select Growth LT
Portfolio................... Seeks long-term growth of capital. N/A
SunAmerica Focus Growth
Portfolio................... Seeks long-term growth of capital. N/A
SunAmerica Focused Growth
Portfolio................... Seeks long-term growth of capital. N/A
SunAmerica International
Equity Portfolio............ Seeks long-term growth of capital. N/A
SunAmerica Large Cap Growth
Portfolio................... Seeks long-term growth of capital. N/A
SunAmerica Multi-Managed
Growth Portfolio............ Seeks long-term growth of capital. N/A
SunAmerica Multi-Managed
Income Portfolio............ Seeks long-term growth of capital. N/A
SunAmerica Multi-Managed
Income/Equity Portfolio..... Seeks long-term growth of capital. N/A
SunAmerica Multi-Managed
Moderate Growth Portfolio... Seeks long-term growth of capital. N/A
D-2
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of the Adviser, will provide the Adviser with a copy of such code of ethics, together with evidence of its adoption, and any material changes thereto. Within 45 days after the end of the last calendar quarter of each year that this Agreement is in effect, the president or a vice president of INTECH shall certify to the Adviser that INTECH has complied with the requirements of Rule 17j-1 during the previous year and that there has been no violation of INTECH’s code of ethics or, if such a violation has occurred, that appropriate action was taken in response to such violation. Upon the written request of the Adviser, INTECH shall permit the Adviser, its employees or its agents to examine the reports required to be made to INTECH by Rule 17j-1(c)(1) Janus Capitaland all other records relevant to INTECH’s code of ethics.(c) INTECH has contractually agreedprovided the Adviser with a copy of its Form ADV as most recently filed with the U.S. Securities and Exchange Commission (“SEC”) and will, promptly after filing any amendment to waiveits Form ADV with the Portfolio's total annual
fund operating expenses (excluding distributionSEC, furnish a copy of such amendment to the Adviser. 7. Representations of the Adviser. The Adviser hereby represents, warrants and shareholder servicing
feescovenants to INTECH as follows: (a) The Adviser (i) is registered as an investment adviser under the Advisers Act and will continue to be so registered for so long as this Agreement remains in effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from fulfilling its obligations under this Agreement; (iii) has met, and will continue to meet for so long as this Agreement remains in effect, any other applicable federal or state requirements, or the applicable requirements of any regulatory or industry self-regulatory organization necessary to Service Sharesbe met in order to fulfill its obligations under this Agreement; (iv) has the legal and Service II Shares, brokerage
commissions, interest, dividends, taxes,corporate authority to enter into and extraordinary expenses
including, but not limitedperform this Agreement; and (v) will immediately notify INTECH of the occurrence of any event that would disqualify the Adviser from serving as an investment adviser of an investment company pursuant to acquired fund feesSection 9(a) of the 1940 Act or otherwise, and expenses)of the institution of any administrative, regulatory or judicial proceeding against the Adviser that could have a material adverse effect upon the Adviser’s ability to fulfill its obligations under this Agreement. M-3
(b) The Adviser has adopted a certain
limitwritten code of ethics complying with the requirements of Rule 17j-1 under the 1940 Act and will provide INTECH with a copy of such code of ethics, together with evidence of its adoption. (c) The Adviser has provided INTECH with a copy of its Form ADV as most recently filed with the U.S. Securities and Exchange Commission (“SEC”) and will, promptly after filing any amendment to its Form ADV with the SEC, furnish a copy of such amendment to INTECH. 8. Term. This Agreement shall become effective as of the date first set forth above and shall continue in effect until [February 1, 2018] unless sooner terminated in accordance with its terms, and shall continue in effect from year to year thereafter only so long as such continuance is specifically approved at least Mayannually by (a) the vote of a majority of the Trustees of the Trust who are not parties hereto or interested persons of the Trust, the Adviser or INTECH, cast in person at a meeting called for the purpose of voting on the approval of the terms of such renewal, and (b) either the Trustees of the Trust or the affirmative vote of a majority of the outstanding voting securities of the Fund. The annual approvals provided for herein shall be effective to continue this Agreement from year to year if given within a period beginning not more than ninety (90) days prior to February 1 2011. The contractual waiverof each applicable year, notwithstanding the fact that more than three hundred sixty-five (365) days may have elapsed since the date on which such approval was last given. 9. Termination. This Agreement may be terminated or modified at any time, without penalty, by the Trustees or by the shareholders of the Fund acting by vote of at least a majority of its outstanding voting securities, provided in any such case that 60 days’ advance written notice of termination be given to INTECH at its principal place of business. This Agreement may be terminated (i) by the Adviser or by INTECH at any time, without penalty by giving 60 days’ advance written notice of termination to the other party, or (ii) by the Adviser or the Trust without advance notice if INTECH becomes unable to discharge its duties and obligations under this Agreement. In addition, this Agreement shall terminate, without penalty, upon termination of the Advisory Agreement. 10. Assignment. This Agreement shall automatically terminate in the event of its assignment. 11. Amendments. This Agreement may be amended by the parties only in a written instrument signed by the parties to this Agreement and only if such amendment is specifically approved (i) by a majority of the Trustees, including a majority of the Trustees who are not interested persons (as that phrase is defined in Section 2(a)(19) of the 1940 Act) of the Trust or the Adviser, INTECH or their affiliates, and (ii) if required by applicable law, by the affirmative vote of a majority of the outstanding voting securities of the Fund (as that phrase is defined in Section 2(a)(42) of the 1940 Act). 12. Limitation on Personal Liability. All parties to this Agreement acknowledge and agree that the Trust is a series trust and all debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to a particular series shall be enforceable against the assets held with respect to such series only, and not against the assets of the Trust generally or against the assets held with respect to any other series and further that no Trustee, officer or holder of shares of beneficial interest of the Trust shall be personally liable for any of the foregoing. 13. Limitation of Liability of INTECH. The Adviser will not seek to hold INTECH, and INTECH shall not be, liable for any error of judgment or mistake of law or for any loss arising out of any investment or for any act or omission taken with respect to the Fund, 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, “INTECH” shall include any affiliate of INTECH performing services for the Fund contemplated hereunder and directors, officers and employees of INTECH and such affiliates. 14. Activities of INTECH. The services of INTECH hereunder are not to be deemed to be exclusive, and INTECH is free to render services to other parties, so long as its services under this Agreement are not materially adversely affected or otherwise impaired thereby. Nothing in this Agreement shall limit or restrict the right of any director, officer or employee of INTECH to engage in any other business or to devote his or her time and attention in part to the management or other aspects of any other business, whether of a similar or a dissimilar M-4
nature. It is understood that Trustees, officers and shareholders of the Trust are or may become interested in INTECH as directors, officers and shareholders of INTECH, that directors, officers, employees and shareholders of INTECH are or may become similarly interested in the Trust, and that INTECH may become interested in the Trust as a shareholder or otherwise. 15. Third Party Beneficiary. The parties expressly acknowledge and agree that the Trust is a third party beneficiary of this Agreement and that the Trust shall have the full right to sue upon and enforce this Agreement in accordance with its terms as if it were a signatory hereto. Any oversight, monitoring or evaluation of the activities of INTECH by the Adviser, the Trust or the Fund shall not diminish or relieve in any way the liability of INTECH for any of its duties and responsibilities under this Agreement. 16. Notices. Any notice or other communication required to be given pursuant to this Agreement shall be deemed duly given if delivered personally or by overnight delivery service or mailed by certified or registered mail, return receipt requested and postage prepaid, or sent by facsimile addressed to the parties at their respective addresses set forth below, or at such other address as shall be designated by any party in a written notice to the other party. (a) To the Adviser at: [Janus Henderson Capital Management LLC] 151 Detroit Street Denver, Colorado 80206 Attention: General Counsel Phone: (303) 333-3863 Fax: (303) 316-5728 (b) To INTECH at: INTECH Investment Management LLC 525 Okeechobee Blvd, Suite 1800 West Palm Beach, Florida 33401 Attention: General Counsel Phone: (561) 775-1100 Fax: (561) 775-1150 (c) To the Trust at: Janus Investment Fund 151 Detroit Street Denver, Colorado 80206 Attention: Chief Legal Counsel Phone: (303) 333-3863 Fax: (303) 316-5728 17. Certain Definitions. The terms “vote of a majority of the outstanding voting securities,” “assignment,” “approved at least annually,” and “interested persons” shall have the respective meanings specified in the 1940 Act, as now in effect or hereafter amended, and the rules and regulations thereunder, subject to such orders, exemptions and interpretations as may be issued by the SEC under the 1940 Act and as may be then in effect. 18. Governing Law. This Agreement shall be construed in accordance with the laws of the State of Colorado (without giving effect to the conflicts of laws principles thereof) and the 1940 Act. To the extent that the applicable laws of the State of Colorado conflict with the applicable provisions of the 1940 Act, the latter shall control. [Remainder of page intentionally left blank.] M-5
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized officers designated below as of the first date written above. | | | [JANUS HENDERSON CAPITAL MANAGEMENT LLC] | | | By: | | | Name: | | | Title: | | |
| | | INTECH INVESTMENT MANAGEMENT LLC | | | By: | | | Name: | | | Title: | | |
M-6
Appendix N Form of New Perkins Sub-Advisory Agreement PROPOSED SUB-ADVISORY AGREEMENT JANUS ASPEN PERKINS MID CAP VALUE PORTFOLIO (a Series of Janus Aspen Series) This SUB-ADVISORY AGREEMENT (the “Agreement”) is entered into effective as of the day of __, 2017, by and between [JANUS HENDERSON CAPITAL MANAGEMENT LLC], a Delaware limited liability company (the “Adviser”) and PERKINS INVESTMENT MANAGEMENT LLC, a Delaware limited liability company (“Perkins”). WHEREAS, the Adviser has entered into an Investment Advisory Agreement (the “Advisory Agreement”) with Janus Aspen Series, a Delaware statutory trust (the “Trust”) and an open-end, management investment company registered under the Investment Company Act of 1940, as amended (the “1940 Act”), with respect to Janus Aspen Perkins Mid Cap Value Portfolio, a series of the Trust (the “Fund”) pursuant to which the Adviser has agreed to provide investment advisory services with respect to the Fund; and WHEREAS, Perkins is engaged in the business of rendering investment advisory services and is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”); and WHEREAS, the Adviser desires to retain Perkins to furnish investment advisory services with respect to the Fund, and Perkins is willing to furnish such services; NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Duties of Perkins. The Adviser hereby engages the services of Perkins as subadviser in furtherance of the Advisory Agreement. Perkins agrees to perform the following duties, subject to the oversight of the Adviser and to the overall control of the officers and the Board of Trustees (the “Trustees”) of the Trust: (a) Perkins shall manage the investment operations of the Fund and the composition of its investment portfolio, shall determine without prior consultation with the Trust or the Adviser, what securities and other assets of the Fund will be acquired, held, disposed of or loaned, and shall direct the Adviser with respect to the execution of trades in connection with such determinations, in conformity with the investment objectives, policies and restrictions and the other statements concerning the Fund in the Trust’s trust instrument, as amended from time to time (the “Trust Instrument”), bylaws and registration statements under the 1940 Act and the Securities Act of 1933, as amended (the “1933 Act”), the Advisers Act, the rules thereunder and all other applicable federal and state laws and regulations, and the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), applicable to the Trust, on behalf of the Fund, as a regulated investment company; (b) Perkins shall cause its officers to attend meetings and furnish oral or written reports, as the Trust or the Adviser may reasonably require, in order to keep the Adviser, the Trustees and appropriate officers of the Trust fully informed as to the condition of the investment portfolio of the Fund, the investment decisions of Perkins, and the investment considerations which have given rise to those decisions; (c) Perkins shall maintain all books and records required to be maintained by Perkins pursuant to the 1940 Act, the Advisers Act, and the rules and regulations promulgated thereunder, as the same may be amended from time to time, with respect to transactions on behalf of the Fund, and shall furnish the Trustees and the Adviser with such periodic and special reports as the Trustees or the Adviser reasonably may request. Perkins hereby agrees that all records which it maintains for the Fund or the Trust are the property of the Trust, agrees to permit the reasonable inspection thereof by the Trust or its designees and agrees to preserve for the periods prescribed under the 1940 Act and the Advisers Act any records which it maintains for the Trust and which are required to be maintained under the 1940 Act and the Advisers Act, and further agrees to surrender promptly to the Trust or its designees any records which it maintains for the Trust upon request by the Trust; N-1
(d) Perkins shall submit such reports relating to the valuation of the Fund’s assets and to otherwise assist in the calculation of the net asset value of shares of the Fund as may reasonably be requested; (e) Perkins shall provide the Adviser with such assistance and advice as the Adviser may reasonably request as to the manner in which to exercise, on behalf of the Fund, such voting rights, subscription rights, rights to consent to corporate action and any other rights pertaining to the Fund’s assets that may be exercised, in accordance with any policy pertaining to the same that may be adopted or agreed to by the Trustees of the Trust, so that the Adviser may exercise such rights, or, in the event that the Trust retains the right to exercise such voting and other rights, to furnish the Trust with advice as may reasonably be requested as to the manner in which such rights should be exercised; (f) At such times as shall be reasonably requested by the Trustees or the Adviser, Perkins shall provide the Trustees and the Adviser with economic, operational and investment data and reports, including without limitation all information and materials reasonably requested by or requested to be delivered to the Trustees of the Trust pursuant to Section 15(c) of the 1940 Act, and shall make available to the Trustees and the Adviser any economic, statistical and investment services normally available to similar investment company clients of Perkins; and (g) Perkins will provide to the Adviser for regulatory filings and other appropriate uses materially accurate and complete information relating to Perkins as may be reasonably requested by the Adviser from time to time and, notwithstanding anything herein to the contrary, Perkins shall be liable to the Adviser for all damages, costs and expenses, including without limitation reasonable attorney’s fees (hereinafter referred to collectively as “Damages”), incurred by the Adviser as a result of any material inaccuracies or omissions in such information provided by Perkins to the Adviser, provided, however, that Perkins shall not be liable to the extent that any Damages are based upon inaccuracies or omissions made in reliance upon information furnished to Perkins by the Adviser. 2. Further Obligations. In all matters relating to the performance of this Agreement, Perkins shall act in conformity with the Trust’s Trust Instrument, bylaws and currently effective registration statements under the 1940 Act and the 1933 Act and any amendments or supplements thereto (the “Registration Statements”) and with the written policies, procedures and guidelines of the Fund, and written instructions and directions of the Trustees and the Adviser and shall comply with the requirements of the 1940 Act, the Advisers Act, the rules thereunder, and all other applicable federal and state laws and regulations. The Adviser agrees to provide to Perkins copies of the Trust’s Trust Instrument, bylaws, Registration Statement, written policies, procedures and guidelines and written instructions and directions of the Trustees and the Adviser, and any amendments or supplements to any of them at, or, if practicable, before the time such materials become effective. 3. Obligations of the Adviser. The Adviser shall have the following obligations under this Agreement: (a) To keep Perkins continuously and fully informed (or cause the custodian of the Fund’s assets to keep Perkins so informed) as to the composition of the investment portfolio of the Fund and the nature of all of the Fund’s assets and liabilities from time to time; (b) To furnish Perkins 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; (c) To furnish Perkins with any further materials or information which Perkins may reasonably request to enable it to perform its function under this Agreement; and (d) To compensate Perkins for its services in accordance with the provisions of Section 4 hereof. N-2
4. Compensation. The Adviser shall pay Perkins for its services under this Agreement, a fee equal to 50% of the advisory fee payable to the Adviser from the Fund (net of any performance fee adjustment, reimbursement of expenses incurred or fees waived by the Adviser). Fees paid to Perkins shall be computed and accrued daily and payable monthly as of the last day of each month during which or part of which this Agreement is in effect. 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. 5. Expenses. Perkins shall pay all its own costs and expenses incurred in rendering its service under this Agreement. 6. Representations of Perkins. Perkins hereby represents, warrants and covenants to the Adviser as follows: (a) Perkins: (i) is registered as an investment adviser under the Advisers Act and will continue to be so registered for so long as this Agreement remains in effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from performing the services contemplated by this Agreement; (iii) has met, and will continue to meet for so long as this Agreement remains in effect, any other applicable federal or state requirements, or the applicable requirements of any regulatory or industry self-regulatory organization necessary to be met in order to perform the services contemplated by this Agreement; (iv) has the legal and corporate authority to enter into and perform the services contemplated by this Agreement; and (v) will immediately notify the Adviser of the occurrence of any event that would disqualify Perkins from serving as an investment adviser of an investment company pursuant to Section 9(a) of the 1940 Act or otherwise, and of the institution of any administrative, regulatory or judicial proceeding against Perkins that could have a material adverse effect upon Perkins’ ability to fulfill its obligations under this Agreement. (b) Perkins has adopted a written code of ethics complying with the requirements of Rule 17j-1 under the 1940 Act and will provide the Adviser with a copy of such code of ethics, together with evidence of its adoption, and any material changes thereto. Within 45 days after the end of the last calendar quarter of each year that this Agreement is in effect, the president or a vice president of Perkins shall certify to the Adviser that Perkins has complied with the requirements of Rule 17j-1 during the previous year and that there has been no violation of Perkins’ code of ethics or, if such a violation has occurred, that appropriate action was taken in response to such violation. Upon the written request of the Adviser, Perkins shall permit the Adviser, its employees or its agents to examine the reports required to be made to Perkins by Rule 17j-1(c)(1) and all other records relevant to Perkins’ code of ethics. (c) Perkins has provided the Adviser with a copy of its Form ADV as most recently filed with the U.S. Securities and Exchange Commission (“SEC”) and will, promptly after filing any amendment to its Form ADV with the SEC, furnish a copy of such amendment to the Adviser. 7. Term. This Agreement shall become effective as of the date first set forth above and shall continue in effect until [February 1, 2018] unless sooner terminated in accordance with its terms, and shall continue in effect from year to year thereafter only so long as such continuance is specifically approved at least annually by (a) the vote of a majority of the Trustees of the Trust who are not parties hereto or interested persons of the Trust, the Adviser or Perkins, cast in person at a meeting called for the purpose of voting on the approval of the terms of such renewal, and (b) either the Trustees of the Trust or the affirmative vote of a majority of the outstanding voting securities of the Fund. The annual approvals provided for herein shall be effective to continue this Agreement from year to year if given within a period beginning not more than ninety (90) days prior to February 1 of each applicable year, notwithstanding the fact that more than three hundred sixty-five (365) days may have elapsed since the date on which such approval was last given. 8. Termination. This Agreement may be terminated at any time, without penalty, by the Trustees or by the shareholders of the Fund acting by vote of at least a majority of its outstanding voting securities, provided in any such case that 60 days’ advance written notice of termination be given to Perkins at its principal place of business. This Agreement may be terminated (i) by the Adviser at any time, without penalty by giving 60 days’ advance written notice of termination to Perkins; (ii) by Perkins at any time, without penalty by giving 90 days’ N-3
advance notice to the Adviser and the Trust, unless the Adviser or the Trust requests additional time to find a replacement for Perkins, in which case Perkins shall allow the additional time requested by the Adviser or the Trust not to exceed 90 days’ beyond the initial 90 days’ notice period unless otherwise agreed to by the Adviser, the Trust and Perkins; or (iii) by the Adviser or the Trust without advance notice if Perkins becomes unable to discharge its duties and obligations under this dateAgreement. In addition, this Agreement shall terminate, without penalty, upon the termination of the Advisory Agreement. 9. Assignment. This Agreement shall automatically terminate in the event of its assignment. 10. Amendments. This Agreement may be amended by the parties only in a written instrument signed by the parties to this Agreement and only if such amendment is specifically approved (i) by a majority of the Trustees, including a majority of the Trustees who are not interested persons (as that phrase is defined in Section 2(a)(19) of the 1940 Act) of the Trust or the Adviser, Perkins or their affiliates, and (ii) if required by applicable law, by the affirmative vote of a majority of the outstanding voting securities of the Fund (as that phrase is defined in Section 2(a)(42) of the 1940 Act). 11. Limitation on Personal Liability. All parties to this Agreement acknowledge and agree that the Trust is a series trust and all debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to a particular series shall be enforceable against the assets held with respect to such series only, and not against the assets of the Trust generally or against the assets held with respect to any other series and further that no Trustee, officer or holder of shares of beneficial interest of the Trust shall be personally liable for any of the foregoing. 12. Limitation of Liability of Perkins. The Adviser will not seek to hold Perkins, and Perkins shall not be, liable for any error of judgment or mistake of law or for any loss arising out of any investment or for any act or omission taken with respect to the Fund, 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, “Perkins” shall include any affiliate of Perkins performing services for the Fund contemplated hereunder and directors, officers and employees of Perkins and such affiliates. 13. Activities of Perkins. The services of Perkins hereunder are not to be deemed to be exclusive, and Perkins is free to render services to other parties, so long as its services under this Agreement are not materially adversely affected or otherwise impaired thereby. Nothing in this Agreement shall limit or restrict the right of any director, officer or employee of Perkins to engage in any other business or to devote his or her time and attention in part to the management or other aspects of any other business, whether of a similar or a dissimilar nature. It is understood that Trustees, officers and shareholders of the Trust are or may become interested in Perkins as directors, officers and shareholders of Perkins, that directors, officers, employees and shareholders of Perkins are or may become similarly interested in the Trust, and that Perkins may become interested in the Trust as a shareholder or otherwise. 14. Third Party Beneficiary. The parties expressly acknowledge and agree that the Trust is a third party beneficiary of this Agreement and that the Trust shall have the full right to sue upon and enforce this Agreement in accordance with its terms as if it were a signatory hereto. Any oversight, monitoring or evaluation of the activities of Perkins by the Adviser, the Trust or the Fund shall not diminish or relieve in any way the liability of Perkins for any of its duties and responsibilities under this Agreement. 15. Notices. Any notice or other communication required to be given pursuant to this Agreement shall be deemed duly given if delivered personally or by overnight delivery service or mailed by certified or registered mail, return receipt requested and postage prepaid, or sent by facsimile addressed to the parties at their respective addresses set forth below, or at such other address as shall be designated by any party in a written notice to the other party. N-4
(a) To the Adviser at: [Janus Henderson Capital Management LLC] 151 Detroit Street Denver, Colorado 80206 Attention: General Counsel Phone: (303) 333-3863 Fax: (303) 316-5728 (b) To Perkins at: Perkins Investment Management LLC 311 South Wacker Drive, Suite 6000 Chicago, Illinois 60606 Attention: President Phone: (312) 922-0355 Fax: (312) 922-0418 (c) To the Trust at: Janus Aspen Series 151 Detroit Street Denver, Colorado 80206 Attention: Chief Legal Counsel 16. Certain Definitions. The terms “vote of a majority of the outstanding voting securities,” “assignment,” “approved at least annually,” and “interested persons” shall have the respective meanings specified in the 1940 Act, as now in effect or hereafter amended, and the rules and regulations thereunder, subject to such orders, exemptions and interpretations as may be issued by the SEC under the 1940 Act and as may be then in effect. 17. Governing Law. This Agreement shall be construed in accordance with the laws of the State of Colorado (without giving effect to the conflicts of laws principles thereof) and the 1940 Act. To the extent that the applicable laws of the State of Colorado conflict with the applicable provisions of the 1940 Act, the latter shall control. [Remainder of page intentionally left blank.] N-5
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized officers designated below as of the day and year first above written. | | | [JANUS HENDERSON CAPITAL MANAGEMENT LLC] | | | By: | | | Name: | | | Title: | | | | PERKINS INVESTMENT MANAGEMENT LLC | | | By: | | | Name: | | | Title: | | |
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JOINT SPECIAL JANUS MEETING ASPEN OF SERIES SHAREHOLDERS TO BE HELD ON APRIL 6, 2017 This Proxy is solicited on behalf of the Trustees of Janus Aspen Series. The undersigned, revoking any previous proxies, hereby appoints Bruce Koepfgen, Kathryn Santoro, and Jesper Nergaard or any of them, as attorneys and proxies, with full power of substitution to each, to vote the shares which the undersigned is entitled to vote at the discretionJoint Special Meeting of Shareholders (the “Meeting”) of Janus Aspen Series (the “Trust,” each separate series thereof, a “Fund”), to be held at the JW Marriott Hotel, 150 Clayton Lane, Denver, Colorado, 80206 on April 6, 2017 at [●] a.m. Mountain Time and at any adjournment(s) or postponement(s) of such Meeting. As to any other matter that properly comes before the Meeting or any adjournment(s) or postponement(s) thereof, the persons appointed above may vote in accordance with their best judgment. Receipt of the Notice of a Joint Special Meeting and the accompanying Proxy Statement is hereby acknowledged. The shares of Janus Aspen Series represented hereby will be voted as indicated or FOR the proposals if no choice is indicated. REGARDING THE IMPORTANT AVAILABLITY NOTICE OF PROXY MATERIALS for the The Joint Proxy Special Statement Meeting for of this Shareholders meeting is available on April 6, at: 2017 . https://www.proxy-direct.com/jas-28316 VOTE ON THE INTERNET Log on to: www or scan .proxy the -direct QR code .com Follow the available on-screen 24 hours instructions Call VOTE 1-800 BY- 337 PHONE -3503 Follow the recorded instructions available 24 hours JAS_28316_122016 FUNDS FUNDS FUNDS Fundname Drop-In 1 Fundname Drop-In 2 Fundname Drop-In 3 Fundname Drop-In 4 Fundname Drop-In 5 Fundname Drop-In 6 Fundname Drop-In 7 Fundname Drop-In 8 Fundname Drop-In 9 Fundname Drop-In 10 Fundname Drop-In 11 Fundname Drop-In 12 THIS PROXY IS SOLICITED BY THE BOARD OF TRUSTEES. The Board of Trustees recommends that you vote FOR the following Proposal(s): TO VOTE MARK BLOCKS BELOW IN BLUE OR BLACK INK AS SHOWN IN THIS EXAMPLE: X + A Proposals 1 . To approve a new investment advisory agreement between the Trust, on behalf of your Fund, and Janus Capital Management LLC (“Janus Capital” or the “Adviser”). FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN 01 Fundname Drop-In 1 ? ? ? 02 Fundname Drop-In 2 ? ? ? 03 Fundname Drop-In 3 ? ? ? 04 Fundname Drop-In 4 ? ? ? 05 Fundname Drop-In 5 ? ? ? 06 Fundname Drop-In 6 ? ? ? 07 Fundname Drop-In 7 ? ? ? 08 Fundname Drop-In 8 ? ? ? 09 Fundname Drop-In 9 ? ? ? 10 Fundname Drop-In 10 ? ? ? 11 Fundname Drop-In 11 ? ? ? 12 Fundname Drop-In 12 ? ? ? 2.
2. To approve a new sub-advisory agreement between the Adviser and the Fund’s current Sub-Adviser as follows: 2A. To approve a new sub-advisory agreement between the Adviser and INTECH Investment Management LLC (“INTECH”). FOR AGAINST ABSTAIN 01 Fundname Drop-In 1 2B. To approve a new sub-advisory agreement between the Adviser and Perkins Investment Management LLC (“Perkins”). FOR AGAINST ABSTAIN 01 Fundname Drop-In 1 3. To approve an amended and restated investment advisory agreement to change the benchmark index and performance hurdle used to calculate the performance adjustment component of the Fund’s investment advisory fee rate. FOR AGAINST ABSTAIN 01 Fundname Drop-In 1 4. To elect an additional Trustee to the Board of Trustees of the Trust. 01. Diane L. Wallace FOR WITHHOLD FOR WITHHOLD 01 Fundname Drop-In 1 02 Fundname Drop-In 2 03 Fundname Drop-In 3 04 Fundname Drop-In 4 05 Fundname Drop-In 5 06 Fundname Drop-In 6 07 Fundname Drop-In 7 08 Fundname Drop-In 8 09 Fundname Drop-In 9 10 Fundname Drop-In 10 11 Fundname Drop-In 11 12 Fundname Drop-In 12 5. To approve a proposal that would authorize the Adviser to enter into and materially amend sub-advisory agreements in the future with wholly-owned sub-advisers approval (the “Manager and unaffiliated of Managers sub-advisers, Proposal”) with . the approval of the Board of Trustees. The expense limit is described in the "Management Expenses"
sectionTrustees of the respective prospectus.
(2) Subadvised by INTECH Investment Management LLC.
(3) Each Fund listed below pays an investment advisory fee rate that adjusts up
or down based upon the Fund's performance relative to its benchmark index
during a measurement period.
FUND AS OF DATE FEE RATE
---- ---------- --------
INTECH Risk-Managed Core Fund..................... 10/31/09 0.37%
Janus Contrarian Fund............................. 10/31/09 0.70%
Janus Global Research Fund........................ 10/31/09 0.75%
Janus International Equity Fund................... 07/31/09 0.74%
Janus International Forty Fund.................... 07/31/09 0.73%
Janus Research Fund............................... 10/31/09 0.71%
Janus Worldwide Fund.............................. 10/31/09 0.52%
Worldwide Portfolio............................... 12/31/09 0.57%
(4) Janus Capital has contractually agreed to waive the Fund's total annual fund
operating expenses (excluding any performance adjustments to management
fees, distribution andTrust, but without obtaining additional shareholder servicing fees (12b-1) applicable to
Class A Shares, Class C Shares, Class R Shares, and Class S Shares, the
administrative fees payable pursuant to the Transfer Agency Agreement
applicable to Class D Shares, Class R Shares, Class S Shares, and Class T
Shares, brokerage commissions, interest, dividends, taxes, and extraordinary
expenses including, but not limited to, acquired fund fees and expenses) to
a certain limit until at least February 16, 2011. The contractual waiver may
be terminated or modified at any time prior to this date at the discretion
of the Board of Trustees. The expense limit is described in the "Management
Expenses" section of the respective prospectus.
(5) Janus Capital has contractually agreed to waive the Portfolio's total annual
fund operating expenses (excluding any expenses of an underlying fund
(acquired fund fees and expenses), distribution and shareholder servicing
fees (12b-1) applicable to Class A Shares, Class C Shares, and Class S
Shares, the administrative fees payable pursuant to the Transfer Agency
Agreement applicable to Class D Shares, Class S Shares, and Class T Shares,
brokerage commissions, interest, dividends, taxes, and extraordinary
expenses) to a certain limit until at least February 16, 2011. The
contractual waiver may be terminated or modified at any time prior to this
date at the discretion of the Board of Trustees. The expense limit is
described in the "Management Expenses" section of the respective prospectus.
* The Trustees approved a plan to liquidate and terminate Global Life Sciences
Portfolio, Growth and Income Portfolio, Janus Aspen INTECH Risk-Managed Core
Portfolio, and Research Core Portfolio effective on or about April 30, 2010
or at such earlier time as may be authorized by the Trustees, therefore,
information is not provided for these Portfolios.
D-3
APPENDIX E
PRINCIPAL EXECUTIVE OFFICERS AND DIRECTORS OF JANUS CAPITAL AND THEIR PRINCIPAL
OCCUPATIONS
POSITION(S) WITH JANUS CAPITAL
NAME JANUS CAPITAL/AFFILIATED ENTITY NAME OR AFFILIATED ENTITY
---- -------------------------------------------- --------------------------------------------
Timothy K. Armour(1) Janus Capital Group Inc. Interim Chief Executive Officer and Director
Janus Capital Management LLC Interim Chief Executive Officer
Janus Management Holdings Corp. Interim President and Interim Director
INTECH Investment Management LLC Working Director
Perkins Investment Management LLC Director
Robin C. Beery Janus Capital Group Inc. Executive Vice President and Head of
Intermediary Distribution, Global Marketing
and Product
Janus Capital Management LLC Executive Vice President and Head of
Intermediary Distribution, Global Marketing
and Product
Janus Distributors LLC Executive Vice President and Head of
Intermediary Distribution, Global Marketing
and Product
Perkins Investment Management LLC Director
INTECH Investment Management LLC Working Director
The Janus Foundation Director
Janus Services LLC Executive Vice President and Head of
Intermediary Distribution, Global Marketing
and Product
Gary D. Black(2) Janus Capital Group Inc. Chief Executive Officer and Director
Janus Capital Management LLC Chief Executive Officer
Janus Management Holdings Corp. President and Director
Janus Services LLC Executive Vice President
INTECH Investment Management LLC Working Director
Perkins Investment Management LLC Director
Daniel P. Charles(3) Janus Capital Management LLC Executive Vice President
Janus Capital Asia Limited Director
Janus Capital International Limited Director
Janus Services LLC Executive Vice President
INTECH Investment Management LLC Working Director
Janus Distributors LLC Executive Vice President
Jonathan D. Coleman Janus Capital Management LLC Co-Chief Investment Officer and Executive
Vice President
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POSITION(S) WITH JANUS CAPITAL
NAME JANUS CAPITAL/AFFILIATED ENTITY NAME OR AFFILIATED ENTITY
---- -------------------------------------------- --------------------------------------------
Gregory A. Frost Janus Capital Group Inc. Chief Financial Officer and Executive Vice
President
Janus Capital Management LLC Chief Financial Officer and Executive Vice
President
Janus Capital Asia Limited Director
Janus Capital International Limited Director
Janus Capital Singapore Pte. Limited Director
The Janus Foundation Director
Janus Holdings LLC Senior Vice President, Controller, and
Director
Janus International Holding LLC Executive Vice President, Controller, and
Director
Janus Management Holdings Corp. Chief Financial Officer, Executive Vice
President, and Director
Janus Services LLC Chief Financial Officer and Executive Vice
President
Capital Group Partners, Inc. Chief Financial Officer, Executive Vice
President, and Director
INTECH Investment Management LLC Vice President and Working Director
Perkins Investment Management LLC Executive Vice President and Director
Janus Distributors LLC Chief Financial Officer and Executive Vice
President
Heidi W. Hardin Janus Capital Management LLC General Counsel and Senior Vice President
Janus Services LLC General Counsel and Senior Vice President
Perkins Investment Management LLC Vice President
Janus Distributors LLC General Counsel and Senior Vice President
Kelley Abbott Howes Janus Capital Group Inc. Chief Administrative Officer, General
Counsel, and Executive Vice President
Janus Capital Management LLC Chief Administrative Officer and Executive
Vice President
Janus Management Holdings Corp. Chief Administrative Officer, General
Counsel, Executive Vice President, and
Director
Capital Group Partners, Inc. Director
INTECH Investment Management LLC Vice President
Janus Distributors LLC Chief Administrative Officer and Executive
Vice President
E-2
POSITION(S) WITH JANUS CAPITAL
NAME JANUS CAPITAL/AFFILIATED ENTITY NAME OR AFFILIATED ENTITY
---- -------------------------------------------- --------------------------------------------
Dominic C.
Martellaro(4) Janus Capital Group Inc. Executive Vice President
Janus Capital Management LLC Executive Vice President
Janus Capital Funds Plc Director
Janus Capital Trust Manager Limited Director
Janus Services LLC Executive Vice President
Janus Distributors LLC
Gibson Smith Janus Capital Management LLC Co-Chief Investment Officer and Executive
Vice President
Janus Services LLC Executive Vice President
Perkins Investment Management LLC Director
Richard M. Weil Janus Capital Group Inc. Chief Executive Officer and Director
Janus Capital Management LLC Chief Executive Officer
Janus Management Holdings Corp. President and Director
Janus Services LLC Executive Vice President
INTECH Investment Management LLC Working Director
Perkins Investment Management LLC Director
--------
(1) Mr. Armour resigned his positions with Janus Capital Group Inc. and its
subsidiaries effective January 31, 2010.
(2) Mr. Black resigned his positions with Janus Capital Group Inc. and its
subsidiaries effective July 13, 2009.
(3) Mr. Charles resigned his positions with Janus Capital Group Inc. and its
subsidiaries effective March FOR AGAINST ABSTAIN FOR AGAINST ABSTAIN 01 Fundname Drop-In 1 02 Fundname Drop-In 2 03 Fundname Drop-In 3 04 Fundname Drop-In 4 05 Fundname Drop-In 5 2010.
(4) Mr. Martellaro resigned his positions with Janus Capital Group Inc. and its
subsidiaries effective October 31, 2009.
E-3
APPENDIX F
NUMBER OF OUTSTANDING SHARES AND NET ASSETS
[TO BE UPDATED]
F-1
APPENDIX G
5% BENEFICIAL OWNERS OF OUTSTANDING SHARES
[TO BE UPDATED]
G-1
APPENDIX H
LEGAL MATTERS
In the fall of 2003, the Securities and Exchange Commission ("SEC"), the
Office of the New York State Attorney General ("NYAG"), the Colorado Attorney
General ("COAG"), and the Colorado Division of Securities ("CDS") announced that
they were investigating alleged frequent trading practices in the mutual fund
industry. On August 18, 2004, Janus Capital announced that it had reached final
settlements with the SEC, the NYAG, the COAG, and the CDS related to such
regulators' investigations into Janus Capital's frequent trading arrangements.
A number of civil lawsuits were brought against Janus Capital and certain
of its affiliates, the Janus funds, and related entities and individuals based
on allegations similar to those announced by the above regulators and were filed
in several state and federal jurisdictions. Such lawsuits alleged a variety of
theories for recovery including, but not limited to, the federal securities
laws, other federal statutes (including ERISA), and various common law
doctrines. The Judicial Panel on Multidistrict Litigation transferred these
actions to the U.S. District Court for the District of Maryland (the "Court")
for coordinated proceedings. On September 29, 2004, five consolidated amended
complaints were filed with the Court, one of which still remains, and which was
brought by a putative class of shareholders of Janus Capital Group Inc. ("JCGI")
asserting claims on behalf of the shareholders against JCGI and Janus Capital
(First Derivative Traders et al. v. Janus Capital Group Inc. et al., U.S.
District Court, District of Maryland, MDL 1586, formerly referred to as Wiggins,
et al. v. Janus Capital Group Inc., et al., U.S. District Court, District of
Maryland, Case No. 04-CV-00818).
In the Wiggins case, a Motion to Dismiss was previously granted and the
matter was dismissed in May 2007. Plaintiffs appealed that dismissal to the
United States Court of Appeals for the Fourth Circuit. In May 2009, the Fourth
Circuit reversed the order of dismissal and remanded the case back to the Court
for further proceedings. In October 2009, Janus filed a petition for a writ of
certiorari with the United States Supreme Court to review the judgment of the
United States Court of Appeals for the Fourth Circuit. On January 11, 2010, the
Supreme Court asked the United States Solicitor General to file a brief on the
question of whether Janus' petition should be granted. As a result of these
developments at the Supreme Court, the Court has stayed all further proceedings
until the Supreme Court rules on Janus' petition for a writ of certiorari. In
addition to the Wiggins case, on January 20, 2010, the Court entered orders
dismissing the remaining claims asserted against Janus Capital and its
affiliates by fund investors in Steinberg et al. v. Janus Capital Management,
LLC et al., U.S. District Court, District of Maryland, Case No. 04-CV-00518 (a
derivative claim involving alleged frequent trading practices).
In addition to the lawsuits described above, the Auditor of the State of
West Virginia ("Auditor"), in his capacity as securities commissioner, initiated
administrative proceedings against many of the defendants in the market timing
cases (including JCGI and Janus Capital) and, as a part of its relief, is
seeking disgorgement and other monetary
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relief based on similar market timing allegations (In the Matter of Janus
Capital Group Inc. et al., Before the Securities Commissioner, State of West
Virginia, Summary Order No. 05-1320). In September 2006, JCGI and Janus Capital
filed their answer to the Auditor's summary order instituting proceedings as
well as a Motion to Discharge Order to Show Cause. On July 31, 2009, Janus filed
a "Notice that Matter is Deemed Concluded." At this time, no further proceedings
are scheduled in this matter.
Additional lawsuits may be filed against certain of the Janus funds, Janus
Capital, and related parties in the future. Janus Capital does not currently
believe that these pending actions will materially affect its ability to
continue providing services it has agreed to provide to the Janus funds.
H-2
FORM OF PROXY CARD
PROXY JANUS ASPEN SERIES PROXY
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD [___________], 2010
THIS PROXY IS SOLICITED ON BEHALF OF THE TRUSTEES OF JANUS ASPEN SERIES (THE "TRUST"). The undersigned, revoking any
previous proxies, hereby appoints Robin C. Beery, Jesper Nergaard, and Stephanie Grauerholz-Lofton or any of them, as
attorneys and proxies, with full power of substitution to each, to vote the shares which the undersigned is entitled to
vote at the Special Meeting of Shareholders ("Meeting") of the Funds listed below to be held at the JW Marriott Hotel,
150 Clayton Lane, Denver, CO on [______________], 2010 at [10:00 a.m.] Mountain Time and at any adjournment(s) or
postponement(s) of such Meeting. As to any other matter that properly comes before the Meeting or any adjournment(s) or
postponement(s) thereof, the persons appointed above may vote in accordance with their best judgment. The undersigned
hereby acknowledges receipt of the accompanying Proxy Statement and Notice of Special Meeting.
[VOTE VIA THE INTERNET:]
[VOTE VIA THE TELEPHONE:]
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NOTE: Please sign exactly as your name(s) appears on the
Proxy. If you are signing this Proxy for a corporation,
estate, trust or in other fiduciary capacity, for example,
as a trustee, please state that capacity or title along with
your signature.
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Signature Date
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Signature (Joint Owners) Date
FUNDS FUNDS
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Balanced Portfolio Janus Portfolio
Enterprise Portfolio Overseas Portfolio
Flexible Bond Portfolio Research Core Portfolio
Forty Portfolio Worldwide Portfolio
Global Life Sciences Portfolio Janus Aspen INTECH Risk-Managed Core Portfolio
Global Technology Portfolio Janus Aspen Perkins Mid Cap Value Portfolio
Growth and Income Portfolio
THE SHARES REPRESENTED HEREBY WILL BE VOTED AS INDICATED, OR, IF YOU RETURN THIS PROXY BUT DO NOT FILL IN A BOX BELOW,
WE WILL VOTE YOUR SHARES "FOR" THAT PROPOSAL.
PLEASE MARK BOXES BELOW IN BLUE OR BLACK INK AS FOLLOWS. EXAMPLE: [X]
[ ] To vote FOR ALL Funds on ALL Proposals mark this box. No other vote is necessary.
1. ELECTION OF TEN TRUSTEES: FOR ALL WITHHOLD FOR ALL
AUTHORITY EXCEPT
01. Jerome S. Contro 02. William F. McCalpin 03. John W. McCarter, Jr. FOR ALL
04. Dennis B. Mullen 05. James T. Rothe 06. William D. Stewart [ ] [ ] [ ]
07. Martin H. Waldinger 08. Linda S. Wolf 09. John P. McGonigle
10. John H. Cammack
To withhold authority to vote for one or more (but not all) nominees, mark "FOR ALL EXCEPT" and write the
corresponding number(s) of the nominee(s) on the line below.
2. APPROVE AN AMENDED AND RESTATED INVESTMENT ADVISORY AGREEMENT THAT WILL CHANGE THE INVESTMENT ADVISORY FEE RATE
FROM A FIXED RATE TO A RATE THAT ADJUSTS UP OR DOWN BASED UPON THE FUND'S PERFORMANCE RELATIVE TO ITS BENCHMARK
INDEX.
FOR AGAINST ABSTAIN
Proposal 2.a. Forty Portfolio [ ] [ ] [ ]
Proposal 2.b. Janus Portfolio [ ] [ ] [ ]
Proposal 2.c. Overseas Portfolio [ ] [ ] [ ]
06 Fundname Drop-In 6 07 Fundname Drop-In 7 08 Fundname Drop-In 8 09 Fundname Drop-In 9 10 Fundname Drop-In 10 |