AMENDED INVESTMENT ADVISORY AND SERVICE AGREEMENT
THIS AGREEMENT, dated and effective as of the 3rd day of December, 1999, 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 a
written agreement dated February 1, 1993 and amended November 1, 1998, 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,
calculated at the annual rate of:
0.60% on the first $500 million of the Fund's net assets,
0.50% on net assets from $500 million to $1 billion,
0.46% on net assets from $1 billion to $1.5 billion,
0.43% on net assets from $1.5 billion to $2.5 billion,
0.41% on net assets from $2.5 billion to $4 billion,
0.40% on net assets from $4 billion to $6.5 billion,
0.395% on net assets from $6.5 billion to $10.5 billion,
0.39% on net assets in excess of $10.5 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, 2000. 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 By
Xxxx X. Xxxxx, Xx., President Xxxxx X. Xxxxxxxxxx, President
By By
Xxxxxxx X. Xxxxx, Secretary Xxxxxxx X. Xxxxxx, Secretary
