AMENDED INVESTMENT ADVISORY AND SERVICE AGREEMENT
THIS AGREEMENT, dated and effective as of the 1st day of
March, 2004, is made and entered into by and between THE GROWTH FUND OF AMERICA,
INC., a Maryland corporation (hereinafter called the "Fund"), and CAPITAL
RESEARCH AND MANAGEMENT COMPANY, a Delaware corporation (hereinafter called the
"Adviser"). The parties agree as follows:
1. The Fund hereby employs the Adviser to determine what
securities shall be purchased or sold by the Fund with respect to the investment
and reinvestment of the assets of the Fund. The Adviser hereby accepts such
employment and agrees to render the services and to assume the obligation to the
extent herein set forth, for the compensation herein provided. The Adviser
shall, for all purposes herein, be deemed an independent contractor and not an
agent of the Fund.
2. The Adviser agrees to provide supervision of the portfolio
of the Fund and to determine what securities or other property shall be
purchased or sold by the Fund, giving due consideration to the policies of the
Fund as expressed in the Fund's Articles of Incorporation, By-Laws, Registration
Statement under the Investment Company Act of 1940 (the "1940 Act"),
Registration Statement under the Securities Act of 1933 (the "1933 Act"), and
prospectus as in use from time to time, as well as to the factors affecting the
Fund's status as a regulated investment company under the Internal Revenue Code.
The Adviser shall provide adequate facilities and qualified
personnel for the placement of orders for the purchase, or other acquisition,
and sale, or other disposition, of portfolio securities for the Fund. With
respect to such transactions, the Adviser, subject to such directions as may be
furnished from time to time by the Board of Directors of the Fund, shall
endeavor as the primary objective to obtain the most favorable prices and
executions of orders. Subject to such primary objective, the Adviser may place
orders with brokerage firms which have sold shares of the Fund or which furnish
statistical and other information to the Adviser, taking into account the value
and quality of the brokerage services of such broker-dealers, including the
availability and quality of such statistical and other information. Receipt by
the Adviser of any such statistical and other information and services shall not
be deemed to give rise to any requirement for abatement of the advisory fee
payable pursuant to Section 5 hereof.
3. The Adviser shall furnish the services of persons to
perform the executive, administrative, clerical, and bookkeeping functions of
the Fund, including the daily determination of net asset value and offering
price per share. The Adviser shall pay the compensation and travel expenses of
all such persons, and they shall serve without additional compensation from the
Fund. The Adviser shall also, at its expense, provide the Fund with suitable
office space (which may be in the offices of the Adviser); all necessary small
office equipment and utilities; and general purpose accounting forms, supplies,
and postage used at the offices of the Fund.
4. The Fund shall pay all its expenses not assumed by the
Adviser as provided herein. Such expenses shall include, but shall not be
limited to, custodian, stock transfer and dividend disbursing fees and expenses;
costs of the designing, printing and mailing of reports, prospectuses, proxy
statements, and notices to its shareholders; taxes; expenses of the issuance and
redemption of shares of the Fund (including stock certificates, registration and
qualification fees and expenses); legal and auditing expenses; compensation,
fees, and expenses paid to directors; association dues; costs of stationery and
forms prepared exclusively for the Fund; and costs of assembling and storing
shareholder account data.
5. The Fund shall pay to the Investment Adviser on or before
the tenth (10th) day of each month, as compensation for the services rendered by
the Investment Adviser during the preceding month, the sum of the following
amounts.
On the Portion of Daily
Total Net Asset Value Annual Rate
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Not exceeding $1 billion 0.50%
In excess of $1 billion but not exceeding $2 billion 0.40%
In excess of $2 billion but not exceeding $3 billion 0.37%
In excess of $3 billion but not exceeding $5 billion 0.35%
In excess of $5 billion but not exceeding $8 billion 0.33%
In excess of $8 billion but not exceeding $13 billion 0.315%
In excess of $13 billion but not exceeding $21 billion 0.30%
In excess of $21 billion but not exceeding $27 billion 0.29%
In excess of $27 billion but not exceeding $34 billion 0.285%
In excess of $34 billion but not exceeding $44 billion 0.280%
In excess of $44 billion but not exceeding $55 billion 0.275%
In excess of $55 billion but not exceeding $71 billion 0.270%
In excess of $71 billion but not exceeding $89 billion 0.265%
Over $89 billion 0.260%
Such fee shall be computed and accrued daily based on the
actual number of days per year. The net assets of the Fund shall be determined
in the manner set forth in the Articles of Incorporation and prospectus of the
Fund. In the event of termination other than at the end of a calendar month, the
monthly fee shall be prorated for the portion of the month prior to termination
and paid on or before the tenth (10th) day subsequent to termination.
6. The Adviser agrees to reduce the fee payable to it under
this Agreement by the amount by which the ordinary operating expenses of the
Fund for any fiscal year of the Fund, excluding interest, taxes and
extraordinary expenses, shall exceed one and one-half percent (1-1/2%) of the
first $30 million of average net assets of the Fund determined pursuant to
Section 5, plus one percent (1%) of such average net assets in excess thereof.
Costs incurred in connection with the purchase or sale of portfolio securities,
including brokerage fees and commissions, which are capitalized in accordance
with generally accepted accounting principles applicable to investment
companies, shall be accounted for as capital items and not as expenses. Proper
accruals shall be made by the Fund for any projected reduction hereunder and
corresponding amounts shall be withheld from the fees paid by the Fund to the
Adviser. Any additional reduction computed at the end of the fiscal year shall
be deducted from the fee for the last month of such fiscal year, and any excess
shall be paid to the Fund immediately after the fiscal year end, and in any
event prior to publication of the Fund's annual report, as a reduction of the
fees previously paid during the fiscal year.
7. The expense limitation described in Section 6 shall apply
only to Class A shares issued by the Fund and shall not apply to any other
class(es) of shares the Fund may issue in the future. Any new class(es) of
shares issued by the Fund will not be subject to an expense limitation. However,
notwithstanding the foregoing, to the extent the Investment Adviser is required
to reduce its management fee pursuant to provisions contained in Section 6 due
to the expenses of the Class A shares exceeding the stated limit, the Investment
Adviser will either (i) reduce its management fee similarly for other classes of
shares, or (ii) reimburse the Fund for other expenses to the extent necessary to
result in an expense reduction only for Class A shares of the Fund.
8. Nothing contained in this Agreement shall be construed to
prohibit the Adviser from performing investment advisory, management, or
distribution services for other investment companies and other persons or
companies, or to prohibit affiliates of the Adviser from engaging in such
businesses or in other related or unrelated businesses.
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9. The Adviser shall have no liability to the Fund, or its
shareholders, for any error of judgment, mistake of law, or for any loss arising
out of any investment, or for any other act or omission in the performance of
its obligations to the Fund not involving willful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations and duties hereunder.
10. This Agreement shall continue in effect until the close of
business on August 31, 2004. It may thereafter be renewed from year to year by
mutual consent, provided that such renewal shall be specifically approved at
least annually by either (i) the Board of Directors of the Fund, or by the vote
of a majority (as defined in the 0000 Xxx) of the outstanding voting securities
of the Fund, and (ii) a majority of those directors who are not parties to this
Agreement or interested persons (as defined in the 0000 Xxx) of any such party
cast in person at a meeting called for the purpose of voting on such approval.
Such mutual consent to renewal shall not be deemed to have been given unless
evidenced by a writing signed by both parties hereto.
11. This Agreement may be terminated at any time, without
payment of any penalty, by the Board of Directors of the Fund or by the vote of
a majority (as defined in the 0000 Xxx) of the outstanding voting securities of
the Fund, on sixty (60) days' written notice to the Adviser, or by the Adviser
on like notice to the Fund. This Agreement shall automatically terminate in the
event of its assignment (as defined in the 1940 Act).
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in duplicate originals by their officers thereunto duly
authorized as of the day and year first above written.
THE GROWTH FUND OF AMERICA, INC.
By /s/ Xxxxxx X. X'Xxxx
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Xxxxxx X. X'Xxxx, President
By /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx, Secretary
CAPITAL RESEARCH AND MANAGEMENT COMPANY
By /s/ Xxxxx X. Xxxxxxxxxx
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Xxxxx X. Xxxxxxxxxx, President
By /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, Vice President and Secretary
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