AMENDED INVESTMENT ADVISORY AND SERVICE AGREEMENT
THIS AGREEMENT, dated and effective as of the 1st day of March, 2000
is made and entered into by and between AMERICAN HIGH-INCOME TRUST, a
Massachusetts business trust, (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
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.
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 and offering
price 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, registrar, stock transfer and dividend disbursing fees and expenses;
distribution expenses pursuant to a plan under Rule 12b-1 of the 1940 Act;
costs of the 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; 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, the sum of the following
amounts:
(a) 0.30% per annum on the first $60 million of the Fund's average daily net
assets during the month; plus 0.21% per annum on the portion of such net assets
between $60 million and $1 billion; plus 0.18% per annum on the portion of such
net assets between $1 billion and $3 billion, plus 0.16% per annum on the
portion of such net assets in excess of $3 billion ("Net Asset Portion"); plus
(b) 3% of the first $8,333,333 of the Fund's gross investment income for such
period, plus 2.5% of such income between $8,333,333 and $25 million, plus 2% of
such income in excess of $25 million of the Fund's gross investment income for
such period ("Investment Income Portion").
The Net Asset Portion shall be accrued daily at 1/365th of the applicable
annual rate set forth above. The net assets of the Fund shall be determined in
the manner and on the dates set forth in the prospectus of the Fund and, on
days on which the net assets are not determined, shall be as of the last
preceding day on which the net assets shall have been determined.
The Investment Income Portion shall be accrued daily and "gross investment
income" for this purpose shall be determined in accordance with Generally
Accepted Accounting Principles and shall not include net gains from the sale of
securities or gains from closing transactions in options.
For the purposes hereof, the net assets of the Fund shall be
determined in the manner set forth in the Declaration of Trust 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, distribution
expenses pursuant to a plan under Rule 12b-1 and extraordinary expenses such as
litigation and acquisitions) 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 Board of Directors of the Fund or by vote of a majority (within
the meaning of the Investment Company Act of l940) 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 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, it must be approved by a majority of
those Trustees 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. The term
"assignment" shall have the meaning defined in the 1940 Act.
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 business 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. 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 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.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed in duplicate original by their duly authorized officers.
AMERICAN HIGH-INCOME TRUST CAPITAL RESEARCH AND MANAGEMENT COMPANY
By /s/ Xxxx X. Xxxxx, Xx. By /s/ Xxxxx X. Xxxxxxxxxx
Xxxx X. Xxxxx, Xx., Chairman Xxxxx X. Xxxxxxxxxx, President
By /s/ Xxxxx X. Xxxxxxxx By /s/ Xxxxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxx, Secretary Xxxxxxx X. Xxxxxx, Secretary
