EMERGING MARKETS GROWTH FUND, INC. PRINCIPAL UNDERWRITING AGREEMENT
EMERGING
MARKETS GROWTH FUND, INC.
THIS PRINCIPAL
UNDERWRITING AGREEMENT, is between EMERGING MARKETS GROWTH FUND, INC., a
Maryland corporation (the “Fund”), and AMERICAN FUNDS DISTRIBUTORS, INC., a
California corporation (the “Distributor”).
W I T N E S S E T
H:
WHEREAS, the Fund
is registered under the Investment Company Act of 1940, as amended (the “1940
Act”), as a diversified open-end interval management investment company which
offers one class of shares of common stock, and it is a part of the business of
the Fund, and affirmatively in the interest of the Fund, to offer shares of the
Fund either from time to time or continuously as determined by the Fund’s
officers subject to authorization by its Board of Directors; and
WHEREAS, the
Distributor is engaged in the business of promoting the distribution of shares
of investment companies through securities broker-dealers; and
WHEREAS, the Fund
and the Distributor wish to enter into an agreement with each other to promote
the distribution of the shares of the Fund and of all series or classes of the
Fund which may be established in the future;
NOW, THEREFORE, the
parties agree as follows:
1. (a) The
Distributor shall be the exclusive principal underwriter for the sale of the
shares of the Fund and of each series or class of the Fund which may be
established in the future, except as otherwise provided pursuant to the
following subsection (b). The terms “shares of Fund” or “shares” as
used herein shall mean shares of common stock of the Fund and each series or
class which may be established in the future and become covered by this
Agreement in accordance with Section 20 of this Agreement.
(b) The
Fund may, upon 60 days’ written notice to the Distributor, from time to time,
designate other principal underwriters of its shares with respect to areas other
than the North American continent, Hawaii, Puerto Rico, and such countries or
other jurisdictions as to which the Fund may have expressly waived in writing
its right to make such designation. In the event of such designation,
the right of the Distributor under this Agreement to sell shares in the areas so
designated shall terminate, but this Agreement shall remain otherwise in full
force and effect until terminated in accordance with the other provisions
hereof.
2. In
the sale of shares of the Fund, the Distributor shall act as agent of the Fund
except in any transaction in which the Distributor sells such shares as a dealer
to the public, in which event the Distributor shall act as principal for its own
account.
3. The
Fund shall sell shares only through the Distributor, except that the Fund may,
to the extent permitted by the 1940 Act and the rules and regulations
promulgated thereunder or pursuant thereto, at any time:
(a) issue
shares to any corporation, association, trust, partnership or other
organization, or its, or their, security holders, beneficiaries or members, in
connection with a merger, consolidation or reorganization to which the Fund is a
party, or in connection with the acquisition of all or substantially all the
property and assets of such corporation, association, trust, partnership or
other organization;
(b) issue
shares at net asset value to the holders of shares of capital stock or
beneficial interest of other investment companies that have an affiliated
company or companies of The Capital Group Companies, Inc. serving as investment
adviser, to the extent of all or any portion of amounts received by such
shareholders upon redemption or repurchase of their shares by the other
investment companies;
(c) issue shares at
net asset value to its shareholders in connection with the reinvestment of
dividends paid and other distributions made by the Fund.
4. The
Distributor agrees to sell the Shares, as agent for the Fund, from time to time
during the term of this Agreement only to persons eligible to invest in the Fund
as described in the current Prospectus of the Fund’s Registration Statement in
effect under the Securities Act of 1933, as amended
(“Prospectus”). The Distributor shall not be obligated to sell any
certain number of shares of the Fund. The Distributor shall effect
and maintain appropriate qualification in all those jurisdictions in which it
sells or offers shares for sale and in which qualification is required and shall
remain registered with the Financial Industry Regulatory Authority (“FINRA”) for
so long as this Agreement is in effect.
5. Within
the United States of America, any dealers to whom the Distributor shall offer
and sell shares must be duly licensed and qualified to sell shares of the
Fund. Shares sold to dealers shall be for resale by such dealers only
at the public offering price set forth in and subject to the terms and
conditions of the Prospectus. The Distributor shall not, without the
consent of the Fund, sell or offer for sale any shares of a series or class
issued by the Fund other than as principal underwriter pursuant to this
Agreement.
6. In
its sales to dealers, it shall be the responsibility of the Distributor to
insure that such dealers are appropriately qualified to transact business in the
shares under applicable laws, rules and regulations promulgated by
such national, state, local or other governmental or quasi-governmental
authorities as may in a particular instance have jurisdiction.
7. The
applicable public offering price of shares shall be the price which is equal to
the net asset value per share, as shall be determined by the Fund in the manner
and at the time or times set forth in and subject to the provisions of the
Prospectus of the Fund.
8. All
orders for shares received by the Distributor shall, unless rejected by the
Distributor or the Fund, be accepted by the Distributor immediately upon receipt
and confirmed at an offering price determined in accordance with the provisions
of the Prospectus and the 1940 Act, and applicable rules in effect
thereunder. The Distributor shall not hold orders subject to
acceptance nor otherwise delay their execution. The provisions of
this Section shall not be construed to restrict the right of the Fund to
withhold shares from sale under Section 15 hereof.
9. The
Fund or its transfer agent shall be promptly advised of all orders received, and
shall cause shares to be issued upon payment in New York or Los Angeles Clearing
House Funds (or in such other manner that results in payment no later than would
be the case in either of such Clearing House Funds).
10. The
Distributor shall adopt and follow procedures as approved by the officers of the
Fund for the confirmation of sales to dealers, the collection of amounts payable
by dealers on such sales, and the cancellation of unsettled transactions, as may
be necessary to comply with the requirements of the Securities and Exchange
Commission or FINRA, as such requirements may from time to time
exist.
11. The
Fund agrees to use its best efforts to maintain its registration as a
diversified open-end interval management investment company under the 0000
Xxx.
12. The
Fund agrees to use its best efforts to maintain an effective Prospectus under
the Securities Act of 1933, as amended, and warrants that such Prospectus will
contain all statements required by and will conform with the requirements of
such Securities Act of 1933 and the rules and regulations thereunder, and that
no part of any such Prospectus, at the time the Registration Statement of which
it is a part becomes effective, will contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein, or
necessary to make the statements therein not misleading (excluding any
information provided by the Distributor in writing for inclusion in the
Prospectus). The Distributor agrees and warrants that it will not in
the sale of shares use any Prospectus, advertising or sales literature not
approved by the Fund or its officers nor make any untrue statement of a material
fact nor omit the stating of a material fact necessary in order to make the
statements made, in the light of the circumstances under which they are made,
not misleading. The Distributor agrees to indemnify and hold the Fund
harmless from any and all loss, expense, damage and liability resulting from a
breach of the agreements and warranties contained in this Section, or from the
use of any sales literature, information, statistics or other aid or device
employed in connection with the sale of shares.
13. The
expense of each printing of each Prospectus and each revision thereof or
addition thereto deemed necessary by the Fund’s officers to meet the
requirements of applicable laws shall be borne by the Fund. In
addition, any out-of-pocket costs incurred by the Distributor in connection with
performing its duties hereunder shall be reimbursed by the Fund.
14. The
Fund agrees to use its best efforts to qualify and maintain the qualification of
an appropriate number of the shares of each series or class it offers for sale
under the securities laws of such states as the Distributor and the Fund may
approve. Any such qualification for any series or class may be
withheld, terminated or withdrawn by the Fund at any time in its
discretion. The expense of qualification and maintenance of
qualification shall be borne by the Fund, but the Distributor shall furnish such
information and other material relating to its affairs and activities as may be
required by the Fund or its counsel in connection with such
qualifications.
15. The
Fund may withhold shares of any series or class from sale to any person or
persons or in any jurisdiction temporarily or permanently if, in the opinion of
its counsel, such offer or sale would be contrary to law or if the Directors or
the President or any Vice President of the Fund determines that such offer or
sale is not in the best interest of the Fund. The Fund will give
prompt notice to the Distributor of any withholding and will indemnify it
against any loss suffered by the Distributor as a result of such withholding by
reason of nondelivery of shares of any series or class after a good faith
confirmation by the Distributor of sales thereof prior to receipt of notice of
such withholding.
16. (a)
This Agreement may be terminated at any time, without payment of any penalty, as
to the Fund or any series on sixty (60) days’ written notice by the Distributor
to the Fund.
(b) This Agreement
may be terminated as to the Fund or any series or class by either party upon
five (5) days’ written notice to the other party in the event that the
Securities and Exchange Commission has issued an order or obtained an injunction
or other court order suspending effectiveness of the Registration Statement
covering the shares of the Fund or such series or class.
(c) This Agreement
may be terminated as to the Fund or any series or class by the Fund upon five
(5) days’ written notice to the Distributor provided either of the following
events has occurred:
(i) FINRA
has expelled the Distributor or suspended its membership in that organization;
or
(ii) the
qualification, registration, license or right of the Distributor to sell shares
of any series in a particular state has been suspended or canceled by the State
of California or any other state in which sales of the shares of the Fund or
such series during the most recent 12-month period exceeded 10% of all shares of
such series sold by the Distributor during such period.
(d) This
Agreement may be terminated as to the Fund or any series or class at any time on
sixty (60) days’ written notice to the Distributor without the payment of any
penalty, by vote of a majority of the Independent Directors or by vote of a
majority of the outstanding voting securities (as defined in the 0000 Xxx) of
the Fund or such series or class.
17. This
Agreement shall not be assignable by either party hereto and in the event of
assignment shall automatically terminate forthwith. The term
“assignment” shall have the meaning set forth in the 1940 Act.
18. No
provision of this Agreement shall protect or purport to protect the Distributor
against any liability to the Fund or holders of its shares for which the
Distributor would otherwise be liable by reason of willful misfeasance, bad
faith, gross negligence or reckless disregard of its obligations and duties
under this Agreement.
19. This
Agreement shall become effective on _________, 2009. Unless sooner terminated in
accordance with the other provisions hereof, this Agreement shall continue in
effect until _________, 2010, and shall continue in effect from year to year
thereafter but only so long as such continuance is specifically approved at
least annually by (i) the vote of a majority of the Independent Directors of the
Fund cast in person at a meeting called for the purpose of voting on such
approval, and (ii) the vote of either a majority of the entire Board of
Directors of the Fund or a majority (within the meaning of the 0000 Xxx) of the
outstanding voting securities of the Fund.
20. If
the Fund shall at any time issue shares in more than one series or class, this
Agreement shall take effect with respect to such series or class of the Fund
which may be established in the future at such time as it has been approved as
to such series or class by vote of the Board of Directors and the Independent
Directors.
This Agreement may
be approved, amended, continued or renewed with respect to a series or class as
provided herein notwithstanding such approval, amendment, continuance or renewal
has not been effected with respect to any one or more other series or class of
the Fund.
This Agreement
shall be construed under and shall be governed by the laws of the State of
California, and the parties hereto agree that proper venue of any action with
respect hereto shall be Los Angeles County, California.
IN WITNESS WHEREOF,
the parties hereto have caused this instrument to be executed in duplicate
original by their officers thereunto duly authorized, as of _________,
2009.
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AMERICAN
FUNDS DISTRIBUTORS, INC.
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EMERGING
MARKETS GROWTH FUND, INC.
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By:
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By:
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Xxxxx X.
Xxxxxxxx, President
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Xxxxxx X.
Xxxx, President
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By:
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By:
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Xxxxx X.
Xxxxxx, Secretary
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Xxxxxx X.
Xxx, Secretary
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