ASSIGNMENT AND ASSUMPTION AGREEMENT AND FIFTH AMENDMENT
TO STOCK PURCHASE AGREEMENT
This Assignment and Assumption Agreement and Fifth Amendment to Stock
Purchase Agreement ("Agreement") is made and entered into this 19th day of
November, 1999 by and among Kansas City Southern Industries, Inc., a Delaware
corporation ("KCSI"), ▇▇▇▇▇▇▇▇ Financial, Inc., a Delaware corporation
("▇▇▇▇▇▇▇▇") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, as individuals.
WHEREAS, KCSI, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ are parties to that
certain Stock Purchase Agreement dated April 13, 1984, as amended by that
certain Amendment to Stock Purchase Agreement dated January 4, 1985, that
certain Second Amendment to Stock Purchase Agreement dated March 18, 1988,
that certain Third Amendment to Stock Purchase Agreement dated February 5,
1990, and that certain Fourth Amendment to Stock Purchase Agreement dated
January 1, 1991 (collectively, "Stock Purchase Agreement");
WHEREAS, other individuals initially were also parties to the Stock
Purchase Agreement but have ceased to be shareholders of Janus Capital
Corporation ("JCC") and therefore, in accordance with paragraph 9.12 of the
Stock Purchase Agreement, no longer have any rights or obligations under the
Stock Purchase Agreement;
WHEREAS, KCSI proposes to assign the Stock Purchase Agreement to
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ is willing to assume the obligations of KCSI under such
agreement;
WHEREAS, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ are willing to consent to
the assignment and assumption of the Stock Purchase Agreement; and
WHEREAS, the parties desire to amend the Stock Purchase Agreement as
provided herein.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereby agree as follows:
1. Assignment and Assumption.
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KCSI hereby assigns and transfers to ▇▇▇▇▇▇▇▇ all of its interests in
and rights under the Stock Purchase Agreement and ▇▇▇▇▇▇▇▇ hereby assumes and
agrees to be bound by, satisfy and discharge all of KCSI's obligations under
the Stock Purchase Agreement. The actions taken in the preceding sentence
hereinafter are referred to as the "Assignment".
2. Consent.
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ hereby consent to the aforesaid
Assignment of the Stock Purchase Agreement.
3. Effective Date.
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The Assignment of the Stock Purchase Agreement shall become effective
on the date that the Board of Directors of KCSI approves the distribution of
all or substantially all of the shares of ▇▇▇▇▇▇▇▇ stock owned by KCSI to the
shareholders of KCSI and fixes a record date and distribution date for such
distribution (the "Effective Date"). The amendments to the Stock Purchase
Agreement set forth below shall become effective as of the date of this
Agreement set forth above.
4. Effect of Assignment.
--------------------
(a) The Assignment shall not constitute or result in a release of KCSI
from its obligations under the Stock Purchase Agreement, and KCSI shall
remain obligated under such agreement as a guarantor of the obligations of
▇▇▇▇▇▇▇▇, and also shall continue to be bound by paragraph 18.06 in the same
manner as KCSI was bound thereby prior to the execution of this Agreement.
In the event that ▇▇▇▇▇▇▇▇ fails to perform any obligation under the Stock
Purchase Agreement within the time fixed by such agreement, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
or ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ may give written notice to ▇▇▇▇▇▇▇▇ and KCSI of such
failure, and if such failure continues for a period of thirty days after the
giving of such notice, KCSI then shall be obligated to immediately perform
such obligation. From and after the Effective Date of the Assignment, the
obligations of KCSI under the Stock Purchase Agreement shall be solely as set
forth in this paragraph 4(a).
(b) From and after the Effective Date of the Assignment, all
references to KCSI in the Stock Purchase Agreement which involve or relate to
continuing performance obligations are hereby amended to refer instead to
▇▇▇▇▇▇▇▇. Prior to the Effective Date of the Assignment, all references to
▇▇▇▇▇▇▇▇ in the amendments to the Stock Purchase Agreement set forth below
shall be deemed to refer to KCSI.
5. Amendment of Paragraph 9.13.
---------------------------
Paragraph 9.13 of the Stock Purchase Agreement shall be amended and
restated to read in its entirety as follows:
9. 13 The closing of any purchase of JCC Shares made pursuant to this
Article IX shall take place as the parties to such sale may agree, within 120
days after the date of acceptance of an offer to sell, the exercise of an
option to purchase, or the incurring of an obligation to purchase, pursuant
to this Article IX. At each such closing, the selling Shareholders of JCC
shall deliver certificates representing the JCC Shares being sold and
▇▇▇▇▇▇▇▇ shall deliver payment for such shares in the manner provided in
paragraph 3.02. If the closing occurs on or after the 30th day following the
date of acceptance of an offer to sell, the exercise of an option to
purchase, or the incurring of an obligation to purchase, ▇▇▇▇▇▇▇▇ also shall
pay interest on the purchase price for such shares from such 30th day until
the closing at a rate equal to 50 basis points above the London Inter-Bank
Offered Rate on such 30th day for borrowings with a maturity of 30 days.
6. Amendment of Paragraph 9.15.
---------------------------
Paragraph 9.15 of the Stock Purchase Agreement shall be amended and
restated to read in its entirety as follows:
9.15
(a) If ▇▇▇▇▇▇▇▇ determines to sell its shares of JCC common stock for
cash, stock or other consideration ("Sale of JCC"), and such sale reduces its
ownership of JCC to less than 20% of the voting stock of JCC, ▇▇▇▇▇▇▇▇ shall,
upon such determination, give prompt written notice to the Remaining
Shareholders of JCC (other than ▇▇▇▇▇▇▇▇) of such determination. Such
Remaining Shareholders shall at ▇▇▇▇▇▇▇▇'▇ request, sell their Shares that
are subject to this Agreement to ▇▇▇▇▇▇▇▇ or to ▇▇▇▇▇▇▇▇'▇ designee at the
price set forth in paragraph 9.15 (c) below. Such sale shall occur at such
time and place and in such manner as ▇▇▇▇▇▇▇▇ shall reasonably request;
provided such sale shall not occur prior to the time ▇▇▇▇▇▇▇▇ sells all or a
majority of its shares of JCC common stock as set forth in this paragraph.
(b) If ▇▇▇▇▇▇▇▇ does not request that such Remaining Shareholders sell
their Shares as set forth in paragraph 9.15(a) above, each such Remaining
Shareholder may, with respect to the Shares that are subject to this
Agreement, require (i) ▇▇▇▇▇▇▇▇ to purchase all such Shares held by such
Remaining Shareholder, or (ii) ▇▇▇▇▇▇▇▇ to cause the Remaining Shareholder to
be included as a seller in the Sale of JCC at the price set forth in
paragraph 9.15(c) below and on the other terms agreed to by the parties to
such sale. If a Remaining Shareholder exercises such right, ▇▇▇▇▇▇▇▇ shall
determine which alternative applies. A Remaining Shareholder may exercise
such right by giving written notice to ▇▇▇▇▇▇▇▇ within thirty days after such
Remaining Shareholder receives notice from ▇▇▇▇▇▇▇▇ of ▇▇▇▇▇▇▇▇'▇
determination to enter into a Sale of JCC.
(c) The purchase price under this paragraph shall be the greater of:
(i) fifteen times the Net After-Tax Earnings per Share of JCC for
the fiscal year ended immediately prior to the date of the Sale of JCC, or
(ii) the per share consideration to be received by ▇▇▇▇▇▇▇▇ for
the Sale of JCC.
7. Amendment of Paragraph 10.06.
----------------------------
Paragraph 10.06 of the Stock Purchase Agreement shall be amended and
restated to read in its entirety as follows:
10.06 For purposes of this Article X and elsewhere in this Agreement,
the term "Change in Ownership" shall mean the earlier to occur of the
following:
(a) less than 75% of the members of the Board of Directors of ▇▇▇▇▇▇▇▇
shall be individuals who were members of the Board on the effective date of
this Amendment or individuals whose election, or nomination for election by
▇▇▇▇▇▇▇▇ stockholders, was approved by a vote of at least 75% of the members
of the Board in office prior to such election or nomination; or
(b) Any "person" (as such term is used in Sections 13(d) and 14(d)(2)
of the Securities Exchange Act of 1934 (the "Exchange Act")) shall have
become, without the prior approval of at least 75% of the members of the
Board of Directors of ▇▇▇▇▇▇▇▇ then still in office who were members of such
Board on the effective date of this Amendment or whose election or nomination
for election by ▇▇▇▇▇▇▇▇'▇ stockholders was approved by a vote of at least
75% of members of the Board in office at any time after the date of this
Agreement, the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act) of securities of ▇▇▇▇▇▇▇▇ representing 25% or more (calculated
in accordance with Rule 13d-3) of the combined voting power of ▇▇▇▇▇▇▇▇'▇
then outstanding voting securities, and such person shall have filed a proxy
statement, or tender offer materials, or any other statement or schedule with
the Securities and Exchange Commission, indicating an intention to acquire
control of ▇▇▇▇▇▇▇▇.
8. Amendment of Paragraph 11.01.
----------------------------
Paragraph 11.01 of the Stock Purchase Agreement shall be amended and
restated to read in its entirety as follows:
11.01 The parties hereto have AGREED that the present management of
JCC shall continue to operate the business of JCC, including the business of
JMC prior to the merger of JMC into JCC, of providing investment advice and
management services to Janus Fund, as hereinafter provided. So long as
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ is a holder of at least 5% of the shares of JCC and
continues to be employed as President or Chairman of the Board of JCC and if
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ does not serve as President of JCC, ▇▇▇▇▇ ▇. ▇▇▇▇▇, III
serves as President and Chief Executive Officer (or Co-Chief Executive
Officer with ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇) of JCC, (i) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ shall continue to
establish and implement policy with respect to the investment advisory and
portfolio management activity of JCC, (ii) without ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇'▇
consent, ▇▇▇▇▇▇▇▇ shall not cause JCC to implement, or impose on the
management of JCC any policies, conditions or restrictions regarding the
policy referred to in (i) other than those which were in place at November
15, 1983, and (iii) any changes in management philosophy, style or approach
influencing the management of JCC with respect to the policy referred to in
(i) shall be mutually agreed to by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and by ▇▇▇▇▇▇▇▇. In
furtherance of this objective, so long as ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ is a holder of at
least 5% of the shares of JCC and continues to be employed as President or
Chairman of the Board of JCC and if ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ does not serve as
President of JCC, ▇▇▇▇▇ ▇. ▇▇▇▇▇, III serves as President and Chief Executive
Officer (or Co-Chief Executive Officer with ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇) of JCC,
▇▇▇▇▇▇▇▇ agrees to vote its JCC Shares to elect directors of JCC, at least a
majority of whom shall be selected by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, subject to ▇▇▇▇▇▇▇▇'▇
approval, which approval shall not be unreasonably withheld. Each of the
preceding provisions set forth in this paragraph is expressly conditioned,
however, upon such management and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ continuing to perform
their respective duties with reasonable care and in a manner which is
consistent with past practice and not contrary to the best interests of JCC.
9. Amendment of Paragraph 18.0 1.
-----------------------------
Paragraph 18.01 of the Stock Purchase Agreement shall be amended and
restated to read in its entirety as follows:
18.01 All notices and other communications required or permitted to be
given hereunder shall be in writing and shall be deemed to have
been fully given if delivered or mailed, first class, postage
paid, to the following addresses:
(a) If to KCSI:
Kansas City Southern Industries, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
cc: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Sonnenschein, Nath & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(b) If to the Shareholders of JCC:
Janus Capital Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
cc: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ Plaza Building, Suite 4700
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. Early, Esq.
Janus Capital Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(c) If to ▇▇▇▇▇▇▇▇:
▇▇▇▇▇▇▇▇ Financial, Inc
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
cc: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Sonnenschein, Nath & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
or to any other address or addresses as may hereafter be specified by notice
given by any of the above for itself to the others.
10. Conflict.
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If any conflict shall arise between the terms and conditions of this
Agreement and the Stock Purchase Agreement, this Agreement shall govern with
respect to the matters described herein. Subject to the Assignment and the
amendments made herein, the Stock Purchase Agreement shall remain in full
force and effect and is hereby reaffirmed by the parties as amended herein.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
KANSAS CITY SOUTHERN INDUSTRIES, INC.
By: /s/ ▇.▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman, President and Chief
Executive Officer
▇▇▇▇▇▇▇▇ FINANCIAL INC.
By: /s/ ▇.▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇