INTERNATIONAL GROWTH AND INCOME FUND INVESTMENT ADVISORY AND SERVICE AGREEMENT
INTERNATIONAL
GROWTH AND INCOME FUND
THIS INVESTMENT
ADVISORY AND SERVICE AGREEMENT, dated and effective as of the 1st day of March,
2010, is made and entered into by and between INTERNATIONAL GROWTH AND INCOME
FUND, a Delaware statutory trust, (the “Fund”), and CAPITAL RESEARCH AND
MANAGEMENT COMPANY, a Delaware corporation (the “Investment
Adviser”).
W I T N E S S E T
H
The Fund is an
open-end diversified investment company of the management type, registered under
the Investment Company Act of 1940, as amended (the “1940 Act”). The
Investment Adviser is registered under the Investment Advisers Act of 1940, as
amended, and is engaged in the business of providing investment advisory and
related services to the Fund and to other investment companies.
NOW, THEREFORE, in
consideration of the premises and the mutual undertaking of the parties, it is
covenanted and agreed as follows:
1. The
Fund hereby employs the Investment Adviser to provide investment advisory and
administrative services to the Fund. The Investment Adviser hereby
accepts such employment and agrees to render the services to the extent herein
set forth, for the compensation herein provided. The Investment
Adviser shall, for all purposes herein, be deemed an independent contractor and
not an agent of the Fund.
2. (a) The
Investment Adviser will provide general management services to the Fund,
including overall supervisory responsibility for the general management and
investment of the Fund’s assets, giving due consideration to the policies of the
Fund as expressed in the Fund’s declaration of trust, by-laws, registration
statement under the 1940 Act and registration statement under the Securities Act
of 1933, as amended (the “1933 Act”), as well as to the factors affecting the
Fund’s status as a regulated investment company under the Internal Revenue Code
of 1986, as amended.
(b) The
Investment Adviser may delegate its investment management responsibilities under
paragraph 2(a), or a portion thereof, to one or more entities that are direct or
indirect subsidiaries of the Investment Adviser or at least majority owned
subsidiaries of The Capital Group Companies, Inc. and registered as investment
advisers under the Investment Adviser’s Act of 1940 (each a “Subsidiary”),
pursuant to an agreement between the Investment Adviser and the Subsidiary (the
“Subsidiary Agreement”). Any Subsidiary to which the Investment
Adviser proposes to delegate its investment management responsibilities must be
approved by the Fund’s Board of Trustees, including a majority of the Trustees
who are not parties to this Agreement nor interested persons of any such party
(“Independent Trustees”).
(c) The
Investment Adviser will, subject to the review and approval of the Board of
Trustees of the Fund: (i) set the Fund’s overall investment strategies; (ii)
evaluate, select and recommend Subsidiaries to manage all or a part of the
Fund’s assets; (iii) when appropriate, allocate and reallocate the Fund’s assets
among multiple Subsidiaries; (iv) monitor and evaluate the performance of
Subsidiaries; and (v) implement procedures reasonably designed to ensure that
the Subsidiaries comply with the Fund’s investment objective, policies and
restrictions. The Investment Adviser shall be solely responsible for paying the
fees of any Subsidiary.
(d) Any
Subsidiary Agreement may provide that the Subsidiary, subject to the control and
supervision of the Fund’s Board of Trustees and the Investment Adviser, shall
have full investment discretion for the Fund and shall make all determinations
with respect to (i) the investment of the Fund’s assets assigned to the
Subsidiary; (ii) the purchase and sale of portfolio securities with those
assets, and (iii) any steps that may be necessary to implement an investment
decision. Any delegation of duties pursuant to this paragraph shall comply with
all applicable provisions of Section 15 of the 1940 Act, except to the extent
permitted by any exemptive order of the Securities and Exchange Commission
(“SEC”), or similar relief. The Investment Adviser will periodically
evaluate the continued advisability of retaining any Subsidiary and will make
recommendations to the Fund’s Board of Trustees, as needed.
(e) 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.
(f) The
Investment Adviser shall maintain all books and records with respect to the
Fund’s investment management activities that are required to be maintained
pursuant to the 1940 Act and the rules thereunder, as well as any other
applicable legal requirements. The Investment Adviser acknowledges
and agrees that all such records are the property of the Fund, and it shall
maintain and preserve such records in accordance with applicable law and provide
such records promptly to the Fund upon request.
(g) The
Investment Adviser shall prepare and submit to the Fund all data on the
performance of its duties as investment adviser for required filings with
governmental agencies or for the preparation of reports to the Board of Trustees
or the shareholders of the Fund.
(h) The
Investment Adviser shall furnish from time to time such other appropriate
information as may be reasonably requested by 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 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; service and distribution
expenses pursuant to a plan adopted in accordance with Rule 12b-1 under the 1940
Act; expenses incurred for shareholder servicing, recordkeeping, transactional
services, tax and informational returns and fund and shareholder communications;
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 Independent Trustees;
association dues; and costs of any share certificates, stationery and forms
prepared exclusively for the Fund.
4. (a) 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 calculated at the annual rate of:
0.690% on first
$500 million of net assets,
plus 0.590% on net
assets over $500 million to $1 billion,
plus 0.530% on net
assets over $1 billion to $1.5 billion,
plus 0.500% on net
assets over $1.5 billion to $2.5 billion,
plus 0.480% on net
assets over $2.5 billion to $4 billion,
plus 0.470% on net
assets over $4 billion.
(b) Such fee shall be
accrued daily and the daily rate shall be computed based on the actual number of
days per year. For the purposes hereof, the net assets of the Fund
shall be determined in the manner set forth in the declaration of trust and
registration statement 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 beginning or the termination of such period.
5. This
Agreement may be terminated at any time, without payment of any penalty, by the
Trustees 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 December 31,
2010. 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 Trustees 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, any such renewal must be approved by a
majority of the Independent Trustees at a meeting called for the purpose of
voting on such approval.
6. 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.
7. 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.
8. The
Investment Adviser shall not be liable to the Fund or its shareholders for any
error of judgment, for any mistake of law, for any loss arising out of any
investment or for any act, or omission not involving willful misfeasance, bad
faith, gross negligence, or reckless disregard of its obligations and duties
hereunder.
9. The
obligations of the Fund under this Agreement are not binding upon any of the
Trustees, officers, employees, agents or shareholders of the Fund individually,
but bind only the Fund’s estate. The Investment Adviser agrees to
look solely to the assets of the Fund for the satisfaction of any liability in
respect of the Fund under this Agreement and will not seek recourse against such
Trustees, officers, employees, agents or shareholders, or any of them, or any of
their personal assets for such satisfaction.
10. The
Fund acknowledges and agrees that the names, “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.
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INTERNATIONAL
GROWTH AND
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CAPITAL
RESEARCH AND
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INCOME
FUND
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MANAGEMENT
COMPANY
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By /s/ Xxxx X.
Xxxx
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By /s/ Xxxxxxx X.
Xxxxxx
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Xxxx
X. Xxxx
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Xxxxxxx X. Xxxxxx
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Executive Vice President and
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President
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Principal Executive Officer
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By /s/ Xxxxxxx X.
Xxxx
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By /s/ Xxxxxxx X.
Xxxxxx
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Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxxxx
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Secretary
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Senior
Vice President and Secretary
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