AMENDED INVESTMENT ADVISORY AND SERVICE AGREEMENT
THIS AGREEMENT, dated and effective as of the 1st day of November, 2004, is
made and entered into by and between CAPITAL WORLD GROWTH AND INCOME FUND, INC.,
a Maryland corporation, (hereinafter called the "Fund"), and CAPITAL RESEARCH
AND MANAGEMENT COMPANY, a Delaware corporation, (hereinafter called the
"Investment Adviser").
W I T N E S S E T H
A. The Fund is an open-end diversified investment company of the management
type, registered under the Investment Company Act of 1940 (the "1940 Act"). The
Investment Adviser is registered under the Investment Advisers Act of 1940 and
is engaged in the business of providing investment advisory and related services
to the Fund and to other investment companies.
B. The Investment Adviser has provided investment advisory services to the
Fund since its inception, and is currently providing such services under an
amended agreement dated November 1, 2000, as renewed.
NOW, THEREFORE, in consideration of the premises and the mutual undertaking
of the parties, it is covenanted and agreed as follows:
1. The Investment Adviser shall determine what securities and other assets
shall be purchased or sold by the Fund.
2. The Investment 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 per share. The Investment
Adviser shall pay the compensation and travel expenses of all such persons, and
they shall serve without any additional compensation from the Fund. The
Investment Adviser shall also, at its expense, provide the Fund with necessary
office space (which may be in the offices of the Investment Adviser); all
necessary office equipment and utilities; and general purpose forms, supplies,
and postage used at the offices of the Fund.
3. The Fund shall pay all its expenses not assumed by the Investment
Adviser as provided herein. Such expenses shall include, but shall not be
limited to, expenses incurred in connection with the organization of the Fund,
its qualification to do business as a foreign corporation in the State of
California, and its registration as an investment company under the 1940 Act;
custodian, stock transfer and dividend disbursing fees and expenses;
distribution expenses pursuant to a plan under rule 12b-1 under the 1940 Act;
costs of designing and of printing and mailing to its shareholders reports,
prospectuses, proxy statements, and notices to its shareholders; taxes; expenses
of the issuance, sale, redemption, or repurchase of shares of the Fund
(including registration and qualification expenses); legal and auditing fees and
expenses; compensation, fees, and expenses paid to directors not affiliated with
the Investment Adviser; association dues; and costs of any share certificates,
stationery and forms prepared exclusively for the Fund.
4. 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 a fee, which shall be accrued
daily based on the actual number of days per year, calculated at the annual
rates of:
0.60% on the first $500 million of the Fund's net assets, plus
0.50% on net assets from $500 million to $1 billion, plus
0.46% on net assets from $1 billion to $1.5 billion, plus
0.43% on net assets from $1.5 billion to $2.5 billion, plus
0.41% on net assets from $2.5 billion to $4 billion, plus
0.40% on net assets from $4 billion to $6.5 billion, plus
0.395% on net assets from $6.5 billion to $10.5 billion, plus
0.39% on net assets from $10.5 billion to $17 billion, plus
0.385% on net assets from $17 billion to $21 billion, plus
0.380% on net assets from $21 billion to $27 billion, plus
0.375% on net assets from $27 billion to $34 billion, plus
0.370% on net assets from $34 billion to $44 billion, plus
0.365% on net assets in excess of $44 billion.
For the purposes hereof, the net assets of the Fund shall be determined in
the manner set forth in the Articles of Incorporation and Prospectus of the
Fund. The advisory fee shall be payable for the period commencing on the date on
which operations of the Fund begin and ending on the date of termination hereof
and shall be prorated for any fraction of a month at the termination of such
period.
5. The Investment Adviser agrees that in the event the expenses of the Fund
(with the exclusion of interest, taxes, brokerage costs, extraordinary expenses
such as litigation and acquisitions or other expenses excludable under
applicable state securities laws or regulations) for any fiscal year ending on a
date on which this Investment Advisory and Service Agreement is in effect,
exceed the expense limitations, if any, applicable to the Fund pursuant to state
securities laws or any regulations thereunder, it will reduce its fee by the
extent of such excess and, if required pursuant to any such laws or regulations,
will reimburse the Fund in the amount of such excess.
6. The expense limitation described in Section 5 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 5 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.
7. This Agreement may be terminated at any time, without payment of any
penalty, by the Directors of the Fund or by vote of a majority (within the
meaning of the 0000 Xxx) of the outstanding voting securities of the Fund, on
sixty (60) days' written notice to the Investment Adviser, or by the Investment
Adviser on like notice to the Fund. Unless sooner terminated in accordance with
this provision, this Agreement shall continue until October 31, 2005. It may
thereafter be renewed from year to year by mutual consent; provided that such
renewal shall be specifically approved at least annually by the Board of
Directors of the Fund, or by vote of a majority (within the meaning of the 0000
Xxx) of the outstanding voting securities of the Fund. In either event, it must
be approved by a majority of those Directors who are not parties to such
Agreement nor interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
8. This Agreement shall not be assignable by either party hereto, and in
the event of assignment (within the meaning of the 0000 Xxx) by the Investment
Adviser shall automatically be terminated forthwith.
9. Nothing contained in this Agreement shall be construed to prohibit the
Investment Adviser from performing investment advisory, management, or
distribution services for other investment companies and other persons or
companies, nor to prohibit affiliates of the Investment Adviser from engaging in
such businesses or in other related or unrelated businesses.
10. The Investment Adviser shall not be liable to the Fund or its
stockholders for any error of judgment, act, or omission not involving willful
misfeasance, bad faith, gross negligence, or reckless disregard of its
obligations and duties hereunder.
11. It is understood that the name, "American Funds" and "Capital" or any
derivatives thereof or logo associated with those names are the valuable
property of the Investment Adviser and its affiliates, and that the Fund shall
have the right to use such names (or derivatives or logos) only so long as this
Agreement shall continue in effect. Upon termination of this Agreement the Fund
shall forthwith cease to use such names (or derivatives or logos).
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed in duplicate original by their duly authorized officers.
CAPITAL WORLD GROWTH AND CAPITAL RESEARCH AND
INCOME FUND, INC. MANAGEMENT COMPANY
By /s/ Xxxx X. Xxxxxxx By /s/ Xxxxx X. Xxxxxxxxxx
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Xxxx X. Xxxxxxx, Chairman Xxxxx X. Xxxxxxxxxx, President
By /s/ Xxxxxxx X. Xxxxx By /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxx, Secretary Xxxxxxx X. Xxxxxx,
Vice President and Secretary
