EXHIBIT 10.2
EIGHTH AMENDMENT dated as of April 14, 2004
(this "Amendment"), among JANUS CAPITAL GROUP INC., a
Delaware corporation formerly known as Stilwell
Financial Inc. (the "Borrower"), the lenders party
hereto (the "Lenders") and CITIBANK, N.A., as
administrative agent (in such capacity, the "Agent")
and as swingline lender.
Reference is made to the Five-Year Credit Agreement dated
December 7, 2000 (as amended, supplemented or otherwise modified from time to
time, the "Five-Year Agreement"), among the Borrower, the Lenders party thereto,
Wells Fargo Bank West, N.A., as documentation agent, JPMorgan Chase Bank, as
syndication agent, and the Agent. Capitalized terms used but not otherwise
defined herein have the meanings assigned to them in the Five-Year Agreement as
amended hereby.
The Borrower has informed the Lenders that it intends to
commence an exchange offer pursuant to which it will issue unsecured senior
notes due 2014 in an aggregate principal amount not to exceed $700,000,000 in
exchange for any combination of (a) its 7% senior notes due November 1, 2006
(the "2006 Notes"), together with all accrued interest and other amounts due
thereunder, and (b) its 7.75% senior notes due June 15, 2009 (the "2009 Notes"),
together with all accrued interest and other amounts due thereunder. In
connection with such transactions, the Borrower will incur for a period of no
longer than 65 days additional Indebtedness in an aggregate principal amount not
to exceed $100,000,000 to pay the amount by which the price offered for the 2006
Notes and 2009 Notes in the Exchange Transaction exceeds the principal of and
interest and other amounts accrued or owed with respect to such Notes.
The Borrower has requested that the Lenders consent to the
temporary incurrence of additional Indebtedness described in the preceding
paragraph and agree to amend certain provisions of the Five-Year Agreement as
set forth in this Amendment, and the Lenders whose signatures appear below,
constituting at least the Required Lenders, are willing to agree to such waivers
and amendments on the terms and subject to the conditions set forth herein.
Accordingly, in consideration of the mutual agreements herein
contained and other good and valuable consideration, the sufficiency and receipt
of which are hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. Amendment of Section 1.01. The following new
definitions are inserted in the appropriate alphabetical in Section 1.01 of the
Five-Year Agreement:
"'Eighth Amendment' shall mean the Eighth Amendment
dated as of April 14, 2004, to this Agreement."
"'Exchange Transaction' shall mean the issuance by
the Borrower of unsecured senior notes due 2014 in an
aggregate principal amount not to exceed
$700,000,000 in exchange for any combination of (a) its 7%
senior notes due November 1, 2006 (the "2006 Notes"), together
with all accrued interest and other amounts due thereunder,
and (b) its 7.75% senior notes due June 15, 2009 (the "2009
Notes"), together with all accrued interest and other amounts
due thereunder, and the incurrence for a period not to exceed
65 days of additional Indebtedness to pay the amount by which
the price offered for the 2006 Notes and 2009 Notes in the
exchange exceeds the principal of and interest and other
amounts accrued or owed with respect to such Notes."
"'Leverage Ratio' shall mean, on any date, the ratio
of (a) Consolidated Total Indebtedness as of such date
(excluding the Secured Portion of any Indebtedness referred to
in Section 6.01(a)(viii) and any Indebtedness referred to in
Section 6.01(a)(xii)) to (b) Consolidated EBITDA for the
period of four consecutive fiscal quarters of Stilwell ended
on such date (or, if such date is not the last day of a fiscal
quarter, on the last day of the fiscal quarter of Stilwell
most recently ended prior to such date)."
"'Liquid Assets' shall mean unencumbered cash, cash
equivalents, unused cash available under any equity
monetization and/or hedging transactions described under
Section 6.01(a)(viii), and other readily marketable securities
(it being understood that the equity of the Borrower held by
any Related Subsidiary shall not qualify as 'Liquid Assets'
hereunder), the value of which shall be deemed to be the
amount of cash which would be realized upon prompt liquidation
of such securities."
"'Secured Portion' shall mean, with respect to any
Indebtedness under Section 6.01(a)(viii), either of the
following as applicable: for 'European Options', up to the
present value of the put strike; or, for 'American Options',
up to the strike price."
SECTION 2. Amendment of Section 5.08. Section 5.08 of the
Five-Year Agreement is hereby amended by inserting ", (viii) (excluding the
Secured Portion of any Indebtedness)" immediately after "(v)".
SECTION 3. Amendment of Section 6.01(a). Section 6.01(a) of
the Five-Year Agreement is hereby amended as follows:
(a) Paragraph (viii) of Section 6.01(a) is amended to read as
follows:
(viii) at any time after the completion of
the Exchange Transaction, Indebtedness of the
Borrower and its Related Subsidiaries incurred
pursuant to any equity monetization and/or hedging
transactions entered into with respect to shares of
capital stock of DST Systems; provided that the
aggregate principal amount of such Indebtedness shall
not at any time exceed the greater of (x) (A)
7,424,052 multiplied by (B) the closing price on the
New York Stock Exchange of a share of capital stock
of DST Systems on the date any applicable equity
monetization and/or hedging transaction in connection
with shares of capital stock of DST Systems is
entered into or (y) the current value of the collared
floor under such equitization and/or hedging
transactions.
(b) Section 6.01(a)(xi) of the Five-Year Agreement is amended
to read as follows:
"(xi) other Indebtedness of Stilwell and its
Related Subsidiaries that is not secured by any Lien
in an aggregate principal amount at any time
outstanding that does not exceed $856,000,000
(excluding Indebtedness permitted pursuant to Section
6.01(a)(xii)) minus the aggregate principal amount of
any Indebtedness outstanding under this paragraph
(other than Indebtedness referred to in the
parenthetical above) that shall have been repaid,
prepaid, redeemed, purchased or defeased by Stilwell
or any other Related Subsidiary, including any such
Indebtedness of either Borrower or any Related
Subsidiary of either Borrower originally owed to
third parties and purchased by either Borrower or any
Related Subsidiary of either Borrower (other, in each
case, than Indebtedness repaid, prepaid, redeemed,
purchased or defeased with the proceeds of new
Indebtedness issued for the specific purpose of
providing funds for any such repayment, prepayment,
redemption or purchase); provided that with respect
to any such Indebtedness issued or incurred to
extend, renew or refinance existing Indebtedness, the
principal thereof is not by its terms required to be
repaid, prepaid, redeemed, purchased or defeased, in
whole or in part, at the option of any holder thereof
or on any date prior to the Maturity Date; provided
further that the incurrence of such Indebtedness
would not cause a Default or an Event of Default
under any other Section of this Agreement."
(c) by adding a new Section 6.01(a)(xii) that reads in its
entirety as follows:
(xii) only during the period commencing on
the date of the effectiveness of the Eighth Amendment
and ending 65 days thereafter, an aggregate principal
amount not to exceed $100,000,000 of Indebtedness of
Stilwell outstanding in connection with the Exchange
Transaction.
SECTION 4. Amendment of Section 6.02(g). Section 6.02(g) of
the Five-Year Agreement is hereby amended to read in its entirety as follows:
"(g) Liens on shares of the capital stock of DST
Systems or on any other financial instruments incorporated as
part of a monetization and/or hedging transaction thereof
securing Indebtedness described under Section 6.01(a)(viii);"
SECTION 5. Amendment of Section 6.04. Section 6.04(c)(iv) of
the Five-Year Agreement is hereby amended to read in it entirety as follows:
"(iv) Stilwell may (x) sell the common stock of DST
Systems for cash, (y) exchange the common stock of DST Systems
for the common stock of publicly-traded entity whose senior
unsecured non-credit enhanced long-term indebtedness for
borrowed money is rated Baa3 or better by Moody's Investors
Service or BBB- by Standard and Poor's, in either case to a
third party buyer that
is not an Affiliate of Stilwell, or (z) sell, transfer,
encumber, or otherwise dispose of the common stock of DST
Systems pursuant to any equity monetization and/or hedging
transactions as described under Section 6.01(a)(viii)."
SECTION 6. Amendment to Section 6.06. Section 6.06 of the
Five-Year Agreement is hereby amended by inserting the following language at the
beginning of the Section:
"Except with respect to any equity monetization
and/or hedging transactions as described under Section
6.01(a)(viii),"
SECTION 7. Amendment of Section 6.09. Section 6.09 of the
Five-Year Agreement is hereby amended to read in its entirety as follows:
"SECTION 6.09. Limitation on Investment in JCG
Partners. Except for any contributions or other transfers of
call and/or put options to JCG Partners in connection with the
Exchange Transaction, such Borrower shall not make, or permit
any Related Subsidiary to make, any loans, advances or capital
contributions to, or other investments of any kind in, JCG
Partners or any of its subsidiaries, except that JCG Inc. may
make regularly scheduled payments of interest and principal in
respect of any Indebtedness of JCG Inc. that shall have been
purchased or otherwise acquired by JCG Partners from third
parties."
SECTION 8. Representations, Warranties and Agreements. The
Borrower hereby represents and warrants to and agrees with each Lender and the
Agent that:
(a) The representations and warranties of the Borrower set
forth in Article III of the Five-Year Agreement, after giving effect to
this Amendment, are true and correct in all material respects with the
same effect as if made on the Amendment Effective Date, except to the
extent such representations and warranties expressly relate to an
earlier date.
(b) The Borrower has the requisite power and authority to
execute, deliver and perform its obligations under this Amendment and
to perform its obligations under the Five-Year Agreement, as amended
and waived by this Amendment.
(c) This Amendment has been duly executed and delivered by the
Borrower. The Five-Year Agreement, as amended and waived by this
Amendment, constitutes a legal, valid and binding obligation of the
Borrower, enforceable against the Borrower in accordance with its
terms, except as enforceability may be limited by (i) any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and (ii)
general principles of equity.
(d) As of the Amendment Effective Date, no Event of Default or
Default has occurred and is continuing.
SECTION 9. Conditions to Effectiveness. This Amendment shall
become effective as of the date first above written (the "Amendment Effective
Date") on the date of the satisfaction in full of the following conditions
precedent:
(a) The Agent shall have received duly executed counterparts
hereof which, when taken together, bear the authorized signatures of
the Borrower, Janus Capital Management LLC, the Agent and the Required
Lenders under the Five-Year Agreement.
(b) All legal matters incident to this Amendment shall be
satisfactory to the Required Lenders, the Agent and Cravath, Swaine &
Moore LLP, counsel for the Agent.
(c) The Agent shall have received such other documents,
instruments and certificates as it or its counsel shall reasonably
request.
SECTION 10. Five-Year Agreement. Except as specifically stated
herein, the Five-Year Agreement shall continue in full force and effect in
accordance with the provisions thereof. As used therein, the terms "Agreement,"
"herein," "hereunder," "hereto," "hereof" and words of similar import shall,
unless the context otherwise requires, refer to the Five-Year Agreement as
modified hereby.
SECTION 11. Applicable Law. THIS AMENDMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 12. Counterparts. This Amendment may be executed in
any number of counterparts, each of which shall be an original but all of which,
when taken together, shall constitute but one instrument. Delivery of an
executed counterpart of a signature page of this Amendment by facsimile shall be
effective as delivery of a manually executed counterpart of this Amendment.
SECTION 13. Expenses. The Borrower agrees to reimburse the
Agent for its out-of-pocket expenses in connection with this Amendment,
including the reasonable fees, charges and disbursements of Cravath, Swaine &
Moore LLP, counsel for the Agent.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their respective authorized officers as of the
date first above written.
JANUS CAPITAL GROUP INC.,
by: /s/ Loren M. Starr
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Name: Loren M. Starr
Title: SVP, CFO
JANUS CAPITAL MANAGEMENT LLC, as Guarantor,
by: /s/ Gregory Frost
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Name: Gregory Frost
Title: VP and Controller
CITIBANK, N.A., individually and as
Administrative Agent and as Swingline
Lender,
by: /s/ Matthew Nichols
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Name: Matthew Nichols
Title: Director
WELLS FARGO BANK, N.A., as successor in
interest to WELLS FARGO BANK WEST, N.A.,
by: /s/ Randall Schmidt
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Name: Randall Schmidt
Title: Vice President
JPMORGAN CHASE BANK, individually and as
Syndication Agent,
by: /s/ Marybeth Mullen
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Name: Marybeth Mullen
Title: Vice President
BANK OF AMERICA, N.A.,
by: /s/ Patrick Gally
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Name: Patrick Gally
Title: Vice President
THE GOVERNOR AND COMPANY OF THE BANK OF
IRELAND,
by:
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Name:
Title:
by:
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Name:
Title:
THE BANK OF NEW YORK,
by:
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Name:
Title:
CREDIT SUISSE FIRST BOSTON,
by: /s/ Jay Chall
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Name: Jay Chall
Title: Director
by: /s/ Cassandra Droogan
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Name: Cassandra Droogan
Title: Associate
U.S. BANK NATIONAL ASSOCIATION,
by:
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Name:
Title:
FLEET NATIONAL BANK,
by:
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Name:
Title:
HSBC,
by: /s/ Scott H. Buitekant
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Name: Scott H. Buitekant
Title: First VP
THE ROYAL BANK OF SCOTLAND plc,
by:
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Name:
Title:
STATE STREET BANK AND TRUST COMPANY,
by: /s/ John A. Stankard
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Name: John A. Stankard
Title: Vice President
UMB, N.A.,
by: /s/ Douglas F. Page
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Name: Douglas F. Page
Title: Executive Vice President