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American Funds Distributors
000 Xxxxx Xxxx Xxxxxx x Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone 800/000-0000, ext. 4
INSTITUTIONAL SELLING GROUP AGREEMENT
Ladies and Gentlemen:
We have entered into a principal underwriting agreement with each Fund
in The American Funds Group (Funds) under which we are appointed exclusive agent
for the sale of shares. You have indicated that you wish to act as agent for
your customers in connection with the purchase, sale and redemption of shares of
the Funds as are qualified for sale in your state. We agree to honor your
request, subject to the terms of this Selling Group Agreement (Agreement) set
forth below.
1. Authorization
As a member of a group of firms authorized to make shares of the Funds
available to institutional customers (Selling Group), you will make shares of
the Funds available only to retirement plans of entities that have retirement
plan assets of at least $50 million (Plans). In placing orders for the purchase
and sale of shares of the Funds, you will be acting as agent for your customers.
We shall execute transactions for each of your customers only upon your
authorization, at the regular public price currently determined by the
respective Funds in the manner described in their offering prospectuses
(Prospectuses). This Agreement on your part runs to us and to the respective
Funds and is for the benefit of and enforceable by each. The offering
Prospectuses and this Agreement set forth the terms applicable to sales of
shares of the Funds through you and all other representations or documents are
subordinate.
2. Compensation on Class A Shares
In consideration of your acting as agent for your customers in
connection with the purchase and redemption of Fund shares and to compensate you
for providing certain services to your customers, we will pay you compensation
as described below, subject to your compliance with the following terms. Your
eligibility to continue receiving this compensation will be evaluated
periodically, and your failure to comply with the terms below may result in our
discontinuing ongoing payments to you. Initial qualification does not assure
continued participation, and the payment of this compensation is subject to the
limitations contained in each Fund's Plan of Distribution and may be varied or
discontinued by us at any time.
a. You agree to cooperate as requested with programs that we provide
to enhance shareholder service. You also agree to assume an
active role in providing shareholder services such as processing
May 2002
purchase and redemption transactions, establishing shareholder
accounts, and providing certain information and assistance with
respect to the Funds.
b. You agree to support our marketing efforts by granting reasonable
requests for visits to your offices by our wholesalers and, to
the extent applicable, by including all Funds covered by this
Agreement on your "approved" list.
c. You agree to assign an individual to each Plan account on your
books and to reassign the account should that individual no
longer be assigned to the account. You agree to instruct each
such individual to regularly contact shareholders having accounts
so assigned.
d. You agree to pass through either directly or indirectly to the
individual(s) assigned to such accounts a share of the
compensation paid to you pursuant to this Agreement. You
recognize that payments under this Agreement are intended to
compensate the individual for providing, and encourage the
individual to continue to provide, service to the account holder.
e. You acknowledge that (i) all compensation is subject to the
limitations contained in each Fund's Plan of Distribution and may
be varied or discontinued at any time, (ii) in order to receive a
payment for a particular month, the payment must amount to at
least $100, and (iii) no compensation will be paid on shares
purchased under the net asset value purchase privilege as
described in the Funds' statements of additional information.
f. You will be paid a monthly fee in respect of Class A shares of
Funds held in accounts that are assigned to you. The fee shall be
the product of the average daily net asset value of Class A
shares of Funds in Category 1 and Category 2 on the attached
Schedule A held in such accounts for the applicable month
multiplied by one-twelfth of 0.25%. The rate for Class A shares
of Funds in Category 3 on the attached Schedule A shall be
one-twelfth of 0.15%.
3. Retirement Plan Share Classes (R shares) and Account Options (for
retirement plans only)
a. We will pay you ongoing compensation on a quarterly basis, at the
applicable annual rate set forth below, of the average daily net
asset value of R shares of Funds listed in Category 1, Category 2
and Category 3 on the attached Schedule A that are held in a Plan
account assigned to you at the end of the quarter for which
payment is made. The payment of this ongoing compensation is
subject to the limitations contained in each Fund's Plan of
Distribution and may be varied or discontinued at any time. We
expect that you will maintain one account for each of your Plan
customers on the books of the Funds.
R Share Class Annual Compensation Rate
Class R-1 1.00%
Class R-2 0.75%
Class R-3 0.50%
Class R-4 0.25%
Class R-5 No compensation paid
May 2002
b. If you hold Plan accounts in an omnibus account (i.e., multiple
Plans in one account on the books of the Funds), Plans that are
added to the omnibus account after May 15, 2002 may invest only in
R shares, and you must execute an Omnibus Addendum to the Selling
Group Agreement, which you can obtain by calling our Dealer
Support department, extension 34222.
4. Order Processing
Any order by you for the purchase of shares of the respective Funds
through us shall be accepted at the time when it is received by us (or any
clearinghouse agency that we may designate from time to time), and at the
offering and sale price next determined, unless rejected by us or the respective
Funds. In addition to the right to reject any order, the Funds have reserved the
right to withhold shares from sale temporarily or permanently. We will not
accept any order from you that is placed on a conditional basis or subject to
any delay or contingency prior to execution. The procedure relating to the
handling of orders shall be subject to instructions that we shall forward from
time to time to all members of the Selling Group. The shares purchased will be
issued by the respective Funds only against receipt of the purchase price, in
collected New York or Los Angeles Clearing House funds. If payment for the
shares purchased is not received within three days after the date of
confirmation the sale may be cancelled forthwith, by us or by the respective
Funds, without any responsibility or liability on our part or on the part of the
Funds, and we and/or the respective Funds may hold you responsible for any loss,
expense, liability or damage, including loss of profit suffered by us and/or the
respective Funds, resulting from your delay or failure to make payment as
aforesaid. If this section conflicts with provisions of any operational
agreement you have with any of our affiliates, such operational agreement shall
control.
5. Timeliness of Submitting Orders
You are obliged to date and indicate the time of receipt of all orders
you receive from your customers and to transmit promptly all orders to us in
time to provide for processing at the price next determined after receipt by
you, in accordance with the Prospectuses. You are not to withhold placing with
us orders received from any customers for the purchase of shares. You shall not
purchase shares through us except for the purpose of covering purchase orders
already received by you, or for your bona fide investment.
6. Repurchase of Shares
If any share is repurchased by any of the Funds or is tendered thereto
for redemption within seven business days after confirmation by us of the
original purchase order from you for such security, you shall forthwith refund
to us the full compensation paid to you on the original sale.
7. Processing Redemption Requests
You shall not purchase any share of any of the Funds from a record
holder at a price lower than the net asset value next determined by or for the
Funds' shares. You shall, however, be permitted to sell any shares for the
account of a shareholder of the Funds at the net asset value currently quoted by
or for the Funds' shares, and may charge a fair service fee for handling the
transaction provided you disclose the fee to the record owner.
May 2002
8. Prospectuses and Marketing Materials
We shall furnish you without charge reasonable quantities of offering
Prospectuses (including any supplements currently in effect), current
shareholder reports of the Funds, and sales materials issued by us from time to
time. In the purchase of shares through us, you are entitled to rely only on the
information contained in the offering Prospectus(es). You may not publish any
advertisement or distribute sales literature or other written material to the
public that makes reference to us or any of the Funds (except material that we
furnished to you) without our prior written approval.
9. Effect of Prospectus
This Agreement is in all respects subject to statements regarding the
sale and repurchase or redemption of shares made in offering Prospectuses of the
Funds, which shall control and override any provision to the contrary in this
Agreement.
10. Relationship of Parties
You shall make available shares of the Funds only through us. In no
transaction (whether of purchase or sale) shall you have any authority to act as
agent for, partner of, or participant in a joint venture with us or with the
Funds or any other entity having either a Selling Group Agreement or other
agreement with us.
11. State Securities Qualification
We act solely as agent for the Funds and are not responsible for
qualifying the Funds or their shares for sale in any jurisdiction. Upon written
request we will provide you with a list of the jurisdictions in which the Funds
or their shares are qualified for sale. We also are not responsible for the
issuance, form, validity, enforceability or value of Fund shares.
12. Representations
a. You represent that you are (a) a properly registered or licensed
broker or dealer under applicable federal and state securities laws
and regulations and are complying with and will continue to comply
with all applicable federal and state laws, rules and regulations; a
member of the National Association of Securities Dealers, Inc. (NASD);
and your membership with the NASD is not currently suspended or
terminated; or (b) a "bank" as defined in Section 3(a)(6) of the
Securities Exchange Act of 1934 (or other financial institution) and
not otherwise required to register as a broker or dealer under such
Act or any state laws. You agree to notify us immediately in writing
if any of the foregoing representations ceases to be true to a
material extent. You also agree that, if you are a bank or other
financial institution as set forth above, you will comply with the
applicable rules of the NASD, that you will maintain adequate records
with respect to your customers and their transactions, and that such
transactions will be without recourse against you by your customers.
We recognize that, in addition to applicable provisions of state and
federal securities laws, you may be subject to the provisions of other
laws governing, among other things, the conduct of activities by
federal- and state-chartered and supervised financial institutions and
their
May 2002
affiliated organizations. Because you will be the only entity having a
direct relationship with the customer in connection with securities
purchases hereunder, you will be responsible in that relationship for
ensuring compliance with all applicable federal and state laws, rules
and regulations relating to securities purchases hereunder.
b. We represent that (a) we are acting as an underwriter within the
meaning of the applicable rules of the NASD and are complying with and
will continue to comply with all applicable federal and state laws,
rules and regulations, (b) we are a member of the NASD and (c) our
membership with the NASD is not currently suspended or terminated. We
agree to notify you immediately in writing if any of the foregoing
representations ceases to be true to a material extent.
13. Confidentiality
Each party to this Agreement agrees to maintain all information
received from the other party pursuant to this Agreement in confidence, and each
party agrees not to use any such information for any purpose, or disclose any
such information to any person, except as permitted by applicable laws, rules
and regulations. This provision shall survive the termination of this Agreement.
14. Termination
Either of us may cancel this Agreement at any time by written notice to
the other.
15. Notices
All communications to us should be sent to the above address. Any
notice to you shall be duly given if mailed or sent by overnight courier to you
at the address specified by you below.
* * * * *
May 2002
Execute this Agreement in duplicate and return one of the duplicate
originals to us for our file. This Agreement (i) may be amended by notification
from us and orders received following such notification shall be deemed to be an
acceptance of any such amendment and (ii) shall be construed in accordance with
the laws of the State of California.
Very truly yours,
Accepted:
AMERICAN FUNDS DISTRIBUTORS, INC.
-----------------------------
Firm
By
--------------------------------
By Xxxxx X. Xxxxxxxx
-------------------------- President
Officer or Partner
---------------------------
Print Name
---------------------------
Title
Address:
--------------------------------------------
--------------------------------------------
Date:
May 2002
SCHEDULE A
January 15, 2001
(supersedes Schedule A dated
May 3, 1999)
Category 1 Category 2
AMCAP Fund American High-Income Trust
American Balanced Fund Bond Fund of America
American Mutual Fund Capital World Bond Fund
Capital Income Builder Intermediate Bond Fund of America
Capital World Growth and Income Fund U.S. Government Securities Fund
EuroPacific Growth Fund
Fundamental Investors
Growth Fund of America
Income Fund of America
Investment Company of America
New Economy Fund
New Perspective Fund
New World Fund
SMALLCAP World Fund
Washington Mutual Investors Fund
Category 3
Cash Management Trust of America
U.S. Treasury Money Fund of America
May 2002
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April 2002 1
American Funds Distributors, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone 800/000-0000, ext. 4
Form of omnibus addendum to the
Selling group agreement
(for retirement plan share classes (R shares) only)
Ladies and Gentlemen:
This Omnibus Addendum (Addendum) to the Selling Group Agreement (Agreement1)
into which we previously entered is made by and between you and American Funds
Distributors, Inc. as of the date indicated below. This Addendum constitutes the
agreement between you and us in respect of your holding retirement plan (Plan)
accounts in an omnibus account on the books of the Funds. All terms of the
Agreement and of addenda to the Agreement dated on or prior to the date of this
Addendum continue in full force and effect. If any provision of the Agreement or
any addenda to the Agreement is inconsistent with this Addendum, this Addendum
shall supersede such other provisions.
Requirements to Maintain Retirement Plan Omnibus Accounts
a. In order for you to hold Plan accounts in an omnibus account on the
books of the Funds, you agree to provide us with the following
information, current as of the end of each calendar month, and in a
manner and format satisfactory to us, for each Plan account in the
omnibus account within fifteen (15) calendar days following the end of
such month:
1. Plan's name
2. Selling representative's name
3. Selling representative's number
4. Selling representative's street address, city, state and zip code
5. Selling representative's branch number
6. Name of selling representative's affiliated firm
7. Dollar amount of investments to American Funds during the month
(Include investments from mapped takeover assets, participant
contributions and employer contributions. Do not include
participant-initiated transactions that result in (i) asset
movement between American Funds or (ii) investments to American
Funds from other mutual fund families.)
8. Dollar amount of redemptions from American Fund during the month
(Include redemptions or distributions due to a participant's
separation of service or the removal of an American Fund as an
investment option within the Plan. Do not include
participant-initiated transactions that result in (i) asset
movement between American Funds or (ii) asset movement from
American Funds to other mutual fund families.)
Please note that if you are an institution that conducts retirement
plan business through only one branch and has no representatives (such
as a bank), then you are required to provide only the information
listed in items 1, 7 and 8 above.
--------
1 Agreement means the Selling Group Agreement, Bank Selling Group Agreement, or
Institutional Selling Group Agreement, as the case may be, into which we
previously entered.
April 2002 2
b. If you provide third parties with trading or clearing services, you
may not give such third parties access to the Funds without our
written consent.
Should you hold Plan accounts in an omnibus account, failure to comply with the
requirements set forth above will constitute a breach of the Agreement, thereby
giving us the right to terminate the Agreement.
* * * * *
Execute this Addendum in duplicate and return one of the duplicate originals to
us for our file. This Addendum (i) may be amended by notification from us and
orders received following such notification shall be deemed to be an acceptance
of any such amendment and (ii) shall be construed in accordance with the laws of
the State of California.
Very truly yours,
American Funds Distributors, Inc.
By...........................................................
Xxxxx X. Xxxxxxxx
President
Accepted
...............................................................
Firm
By...........................................................
Officer or Partner
Address:
...............................................................
...............................................................
Date:
...............................................................
April 2002 3
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May 2002 1
American Funds Distributors, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone 800/000-0000, ext. 4
Form of selling group agreement
Ladies and Gentlemen:
We have entered into a principal underwriting agreement with each Fund in The
American Funds Group (Funds) under which we are appointed exclusive agent for
the sale of shares. As such agent we offer to sell to you as a member of a
Selling Group, shares of the Funds as are qualified for sale in your state, on
the terms set forth below. We are acting as an underwriter within the meaning of
the applicable rules of the National Association of Securities Dealers, Inc.
(NASD). In addition, we are the distributor of CollegeAmerica (Program), a
college savings program as described in Section 529 of the Internal Revenue
Code.
1. Authorization to Sell
You are to offer and sell shares only at the regular public price currently
determined by the respective Funds in the manner described in their
offering Prospectuses. This Agreement on your part runs to us and to the
respective Funds and is for the benefit of and enforceable by each. The
offering Prospectuses and this Agreement set forth the terms applicable to
members of the Selling Group and all other representations or documents are
subordinate. You understand that Class 529 shares of the Funds are
available only as underlying investments through the Program.
2. Compensation on Sales of Class A Shares and Class 529-A Shares
a. On sales of Class A shares and Class 529-A shares of Funds listed in
Category 1 on the attached Schedule A that are accepted by us and for
which you are responsible, you will be paid dealer concessions as
follows:
Concession as Sales Charge
Percentage of as Percentage
Purchases Offering Price of Offering Price
Less than $25,000 5.00% 5.75%
$25,000 but less than $50,000 4.25% 5.00%
$50,000 but less than $100,000 3.75% 4.50%
$100,000 but less than $250,000 2.75% 3.50%
$250,000 but less than $500,000 2.00% 2.50%
$500,000 but less than $750,000 1.60% 2.00%
$750,000 but less than $1,000,000 1.20% 1.50%
$1,000,000 or more See below None
b. On sales of Class A shares and Class 529-A shares of Funds listed in
Category 2 on the attached Schedule A that are accepted by us and for
which you are responsible, you will be paid the same dealer
concessions indicated above except as follows:
Concession as Sales Charge
Percentage of as Percentage
Purchases Offering Price of Offering Price
Less than $100,000 3.00% 3.75%
c. If you initiate and are responsible for sales of Class A shares and
Class 529-A shares, a) amounting to $1 million or more, b) made to
employer-sponsored defined contribution-type retirement plans that
qualify to invest at net asset value under the terms of the Fund
Prospectuses, or c) made at net asset value to endowments and
foundations with assets of $50 million or more, you will be paid a
dealer concession of 1.00% on sales to $4 million, plus 0.50% on
amounts over $4 million up to $10 million, plus 0.25% on amounts over
$10 million. No dealer concessions are paid on any other sales of
shares at net asset value, except that concessions may be paid to
dealers on their sales of fund shares to accounts managed by
affiliates of The Capital Group Companies, Inc. as set forth in this
Agreement. Sales of shares of Washington Mutual Investors Fund below
$1 million made in connection with certain accounts established before
September 1, 1969 are subject to reduced concessions and sales charges
as described in the Washington Mutual Investors Fund Prospectus. With
respect to sales of shares of any tax-exempt fund, the concession
schedule for sales of shares to endowments and foundations or
retirement plans of organizations with assets of $50 million or more
is inapplicable. The schedules of sales charges above apply to single
purchases, concurrent purchases of two or more of the Funds (except
those listed in Category 3 on the attached Schedule A), and purchases
made under a statement of intention and pursuant to the right of
accumulation, both of which are described in the Prospectuses.
d. On sales of Class A shares and Class 529-A shares of Funds listed in
Category 3 on the attached Schedule A, no dealer concessions will be
paid.
3. Compensation on Sales of Class B Shares and Class 529-B Shares
a. On sales of Class B shares and Class 529-B shares of Funds listed in
Category 1 and Category 2 on the att Schedule A that are accepted by
us and for which you are responsible, you will be paid:
o a dealer concession of 3.75% of the amount invested, plus
o an immediate service fee of 0.25% of the amount invested.
b. On sales of Class B shares and Class 529-B shares of Funds listed in
Category 3 on the attached Schedule A, no dealer concessions will be
paid.
4. Ongoing Service Fees for Class A, Class 529-A, Class B and Class 529-B
Shares We are also authorized to pay you continuing service fees each
quarter with respect to the Class A, Class 529-A, Class B and Class 529-B
shares of all the Funds to promote selling efforts and to compensate you
for providing certain services to your clients, subject to your compliance
with the following terms, which may be revised by us from time to time.
Your eligibility to continue receiving this compensation will be evaluated
periodically, and your failure to comply with the terms below may result in
our discontinuing service fee payments to you. Initial qualification does
not assure continued participation, and this service fee program may be
amended or terminated by us at any time as indicated below.
a. You agree to cooperate as requested with programs that we provide to
enhance shareholder service. You also agree to assume an active role
in providing shareholder services such as processing purchase and
redemption transactions, establishing shareholder accounts, and
providing certain information and assistance with respect to the
Funds. Redemption levels of shareholder accounts assigned to you will
be considered in evaluating your continued participation in this
service fee program.
b. You agree to support our marketing efforts by granting reasonable
requests for visits to your offices by our wholesalers and, to the
extent applicable, by including all Funds covered by this Agreement on
your "approved" list.
May 2002 3
c. You agree to assign an individual to each shareholder account on your
books and to reassign the account should that individual no longer be
assigned to the account. You agree to instruct each such individual to
regularly contact shareholders having accounts so assigned.
d. You agree to pass through either directly or indirectly to the
individual(s) assigned to such accounts a share of the service fees
paid to you pursuant to this Agreement. You recognize that the service
fee is intended to compensate the individual for providing, and
encourage the individual to continue to provide, service to the
account holder.
e. You acknowledge that (i) all service fee payments are subject to the
limitations contained in each Fund's Plan of Distribution and may be
varied or discontinued at any time, (ii) in order to receive a service
fee for a particular quarter, the fee must amount to at least $100,
and (iii) no service fees will be paid on shares purchased under the
net asset value purchase privilege as described in the Funds'
statements of additional information.
f. On Class A, Class 529-A, Class B and Class 529-B shares of Funds
listed in Category 1 and Category 2 on the attached Schedule A, we
will pay you a quarterly service fee at the following annual rates,
based on the average daily net asset value of Class A, Class 529-A,
Class B and Class 529-B shares, respectively, that have been invested
for 12 months and are held in an account assigned to you at the end of
the quarter for which payment is made:
Annual Service Fee Rate
Shares with a first anniversary of purchase before 7-1-88* 0.15%
Shares with a first anniversary of purchase on or after 7-1-88 0.25%
Shares of state-specific tax-exempt funds 0.25%
g. On Class A, Class 529-A, Class B and Class 529-B shares of Funds
listed in Category 3 on the attached Schedule A, we will pay you a
quarterly service fee at the following annual rates, based on the
average daily net asset value of Class A, Class 529-A, Class B and
Class 529-B shares, respectively, that have been invested for 12
months and are held in an account assigned to you at the end of the
quarter for which payment is made:
Annual Service Fee Rate
All Shares 0.15%
5. Compensation on Sales of Class C Shares and Class 529-C Shares
a. On sales of Class C shares and Class 529-C shares of Funds listed in
Category 1 and Category 2 on the attached Schedule A that are accepted
by us and for which you are responsible, we will pay you: o a dealer
concession of 0.75% of the amount invested, plus o an immediate
service fee of 0.25% of the amount invested.
b. In addition, we will pay you ongoing compensation on a quarterly basis
at the annual rate of 1.00% of the average daily net asset value of
Class C shares and Class 529-C shares of Funds listed in Category 1,
Category 2 and Category 3 on the attached Schedule A that have been
invested for 12 months and are held in an account assigned to you at
the end of the quarter for which payment is made. The payment of this
ongoing compensation is subject to the limitations contained in each
Fund's Plan of Distribution and may be varied or discontinued at any
time. -------- * Except U.S. Government Securities Fund, which pays
service fees at the 0.25% rate on all shares held at least 12 months.
May 2002 4
6. Compensation on Sales of Class 529-E Shares
We will pay you ongoing compensation on a quarterly basis at the annual
rate of 0.50% of the average daily net asset value of Class 529-E shares of
Funds listed in Category 1, Category 2 and Category 3 on the attached
Schedule A that are held in an account assigned to you at the end of the
quarter for which payment is made. The payment of this ongoing compensation
is subject to the limitations contained in each Fund's Plan of Distribution
and may be varied or discontinued at any time.
7. Retirement Plan Share Classes (R shares) and Account Options (for
retirement plans only)
a. We will pay you ongoing compensation on a quarterly basis, at the
applicable annual rate set forth below, of the average daily net asset
value of R shares of Funds listed in Category 1, Category 2 and
Category 3 on the attached Schedule A that are held in a retirement
plan (Plan) account assigned to you at the end of the quarter for
which payment is made. The payment of this ongoing compensation is
subject to the limitations contained in each Fund's Plan of
Distribution and may be varied or discontinued at any time. We expect
that you will maintain one account for each of your Plan customers on
the books of the Funds.
R Share Class Annual Compensation Rate
Class R-1 1.00%
Class R-2 0.75%
Class R-3 0.50%
Class R-4 0.25%
Class R-5 No compensation paid
b. If you hold Plan accounts in an omnibus account (i.e., multiple Plans
in one account on the books of the Funds), Plans that are added to the
omnibus account after May 15, 2002 may invest only in R shares, and
you must execute an Omnibus Addendum to the Selling Group Agreement,
which you can obtain by calling our Dealer Support department,
extension 34222.
8. Order Processing
Any order by you for the purchase of shares of the respective Funds through
us shall be accepted at the time when it is received by us (or any
clearinghouse agency that we may designate from time to time), and at the
offering and sale price next determined, unless rejected by us or the
respective Funds. In addition to the right to reject any order, the Funds
have reserved the right to withhold shares from sale temporarily or
permanently. We will not accept any order from you that is placed on a
conditional basis or subject to any delay or contingency prior to
execution. The procedure relating to the handling of orders shall be
subject to instructions that we shall forward from time to time to all
members of the Selling Group. The shares purchased will be issued by the
respective Funds only against receipt of the purchase price, in collected
New York or Los Angeles Clearing House funds subject to deduction of all
concessions on such sale (reallowance of any concessions to which you are
entitled on purchases at net asset value will be paid through our direct
purchase concession system). If payment for the shares purchased is not
received within three days after the date of confirmation the sale may be
cancelled forthwith, by us or by the respective Funds, without any
responsibility or liability on our part or on the part of the Funds, and we
and/or the respective Funds may hold you responsible for any loss, expense,
liability or damage, including loss of profit suffered by us and/or the
respective Funds resulting from your delay or failure to make payment as
aforesaid.
May 2002 5
9. Timeliness of Submitting Orders
You are obliged to date and indicate the time of receipt of all orders you
receive from your customers and to transmit promptly all orders to us in
time to provide for processing at the price next determined after receipt
by you, in accordance with the Prospectuses. You are not to withhold
placing with us orders received from any customers for the purchase of
shares. You shall not purchase shares through us except for the purpose of
covering purchase orders already received by you, or for your bona fide
investment.
10. Repurchase of Shares
If any share is repurchased by any of the Funds or is tendered thereto for
redemption within seven business days after confirmation by us of the
original purchase order from you for such security, you shall forthwith
refund to us the full concessions paid to you on the original sale.
11. Processing Redemption Requests
You shall not purchase any share of any of the Funds from a record holder
at a price lower than the net asset value next determined by or for the
Funds' shares. You shall, however, be permitted to sell any shares for the
account of a shareholder of the Funds at the net asset value currently
quoted by or for the Funds' shares, and may charge a fair service fee for
handling the transaction provided you disclose the fee to the record owner.
12. Prospectuses and Marketing Materials
We shall furnish you without charge reasonable quantities of offering
Prospectuses (including any supplements currently in effect), current
shareholder reports of the Funds, and sales materials issued by us from
time to time. In the purchase of shares through us, you are entitled to
rely only on the information contained in the offering Prospectus(es). You
may not publish any advertisement or distribute sales literature or other
written material to the public that makes reference to us or any of the
Funds (except material that we furnished to you) without our prior written
approval.
13. Effect of Prospectus
This Agreement is in all respects subject to statements regarding the sale
and repurchase or redemption of shares made in offering Prospectuses of the
Funds, and to the applicable Rules of the NASD, which shall control and
override any provision to the contrary in this Agreement.
14. Relationship of Parties
You shall make available shares of the Funds only through us. In no
transaction (whether of purchase or sale) shall you have any authority to
act as agent for, partner of, or participant in a joint venture with us or
with the Funds or any other entity having either a Selling Group Agreement
or other Agreement with us.
15. State Securities Qualification
We act solely as agent for the Funds and are not responsible for qualifying
the Funds or their shares for sale in any jurisdiction. Upon written
request we will provide you with a list of the jurisdictions in which the
Funds or their shares are qualified for sale. We also are not responsible
for the issuance, form, validity, enforceability or value of Fund shares.
May 2002 6
16. Representations
a. You represent that (a) you are a properly registered or licensed
broker or dealer under applicable federal and state securities laws
and regulations and are complying with and will continue to comply
with all applicable federal and state laws, rules and regulations, (b)
you are a member of the NASD, (c) your membership with the NASD is not
currently suspended or terminated and (d) to the extent you offer any
Class 529 shares, you are properly registered to offer such shares.
You agree to notify us immediately if any of the foregoing
representations is no longer true to a material extent.
b. We represent that (a) we are acting as an underwriter within the
meaning of the applicable rules of the NASD and are complying with and
will continue to comply with all applicable federal and state laws,
rules and regulations, (b) we are a member of the NASD and (c) our
membership with the NASD is not currently suspended or terminated. We
agree to notify you immediately if any of the foregoing
representations is no longer true to a material extent.
17. Confidentiality
Each party to this Agreement agrees to maintain all information received
from the other party pursuant to this Agreement in confidence, and each
party agrees not to use any such information for any purpose, or disclose
any such information to any person, except as permitted by applicable laws,
rules and regulations. This provision shall survive the termination of this
Agreement.
18. Termination
Either of us may cancel this Agreement at any time by written notice to the
other.
19. Notices
All communications to us should be sent to the above address. Any notice to
you shall be duly given if mailed or sent by overnight courier to you at
the address specified by you below.
* * * * *
May 2002 7
Execute this Agreement in duplicate and return one of the duplicate originals to
us for our file. This Agreement (i) may be amended by notification from us and
orders received following such notification shall be deemed to be an acceptance
of any such amendment and (ii) shall be construed in accordance with the laws of
the State of California.
Very truly yours,
American Funds Distributors, Inc.
By......................................................
Xxxxx X. Xxxxxxxx
President
Accepted
...............................................................
Firm
By...........................................................
Print Name ____________________________________
Title __________________________________________
Address:
...............................................................
...............................................................
Date:
...............................................................
May 2002 8
Schedule A
May 15, 2002
(supersedes Schedule A dated January 1, 2002)
A B C 529-A 529-B 529-C 529-E R-1 R-2 R-3 R-4 R-5
Category 1
AMCAP Fund o o o o o o o o o o o o
American Balanced Fund o o o o o o o o o o o o
American Mutual Fund o o o o o o o o o o o o
Capital Income Builder o o o o o o o o o o o o
Capital World Growth and Income Fund o o o o o o o o o o o o
EuroPacific Growth Fund o o o o o o o o o o o o
Fundamental Investors o o o o o o o o o o o o
Growth Fund of America o o o o o o o o o o o o
Income Fund of America o o o o o o o o o o o o
Investment Company of America o o o o o o o o o o o o
New Economy Fund o o o o o o o o o o o o
New Perspective Fund o o o o o o o o o o o o
New World Fund o o o o o o o o o o o o
SMALLCAP World Fund o o o o o o o o o o o o
Washington Mutual Investors Fund o o o o o o o o o o o o
Category 2
American High-Income Trust o o o o o o o o o o o o
American High-Income Municipal Bond Fund o o o na na na na na na na na na
Bond Fund of America o o o o o o o o o o o o
Capital World Bond Fund o o o o o o o o o o o o
Intermediate Bond Fund of America o o o o o o o o o o o o
Limited Term Tax-Exempt Bond Fund of America o o o na na na na na na na na na
Tax-Exempt Bond Fund of America o o o na na na na na na na na na
Tax-Exempt Fund of California o o o na na na na na na na na na
Tax-Exempt Fund of Maryland o o o na na na na na na na na na
Tax-Exempt Fund of Virginia o o o na na na na na na na na na
U.S. Government Securities Fund o o o o o o o o o o o o
Category 3
Cash Management Trust of America o e e o e e o o o o o o
Tax-Exempt Money Fund of America o na na na na na na na na na na na
U.S. Treasury Money Fund of America o na na na na na na o o o o o
Notes and symbols
Class F and Class 529-F shares are available pursuant to a separate agreement.
o Share class is available.
e Share class is available for exchanges only.
na Share class is not available.
May 2002 9
[GRAPHIC OMITTED]
American Funds Distributors, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone 800/000-0000, ext. 4
Form of bank selling group agreement
Ladies and Gentlemen:
We have entered into a principal underwriting agreement with each Fund in The
American Funds Group (Funds) under which we are appointed exclusive agent for
the sale of shares. You have indicated that you wish to act as agent for your
customers in connection with the purchase, sale and redemption of shares of the
Funds as are qualified for sale in your state. We agree to honor your request,
subject to the terms set forth below. In addition, we are the distributor of
CollegeAmerica (Program), a college savings program as described in Section 529
of the Internal Revenue Code.
1. Authorization
In placing orders for the purchase and sale of shares of the Funds, you
will be acting as agent for your customers. We shall execute transactions
for each of your customers only upon your authorization, at the regular
public price currently determined by the respective Funds in the manner
described in their offering Prospectuses. The offering Prospectuses and
this Agreement set forth the terms applicable to sales of shares of the
Funds through you and all other representations or documents are
subordinate. You understand that Class 529 shares of the Funds are
available only as underlying investments through the Program.
2. Compensation on Sales of Class A Shares and Class 529-A Shares
a. On each purchase order for Class A shares and Class 529-A shares of
Funds listed in Category 1 on the attached Schedule A that is accepted
by us and for which you are responsible, you will be paid compensation
as follows:
Compensation as Sales Charge
Percentage of as Percentage
Purchases Offering Price of Offering Price
Less than $25,000 5.00% 5.75%
$25,000 but less than $50,000 4.25% 5.00%
$50,000 but less than $100,000 3.75% 4.50%
$100,000 but less than $250,000 2.75% 3.50%
$250,000 but less than $500,000 2.00% 2.50%
$500,000 but less than $750,000 1.60% 2.00%
$750,000 but less than $1,000,000 1.20% 1.50%
$1,000,000 or more See below None
b. On each purchase order for Class A shares and Class 529-A shares of
Funds listed in Category 2 on the attached Schedule A that is accepted
by us and for which you are responsible, you will be paid the same
compensation indicated above except as follows:
Compensation as Sales Charge
Percentage of as Percentage
Purchases Offering Price of Offering Price
Less than $100,000 3.00% 3.75%
May 2002 1
c. For purchase orders of Class A shares and Class 529-A shares for which
you are responsible, a) amounting to $1 million or more, b) made to
employer-sponsored defined contribution-type retirement plans that
qualify to invest at net asset value under the terms of the Fund
Prospectuses, or c) made at net asset value to endowments and
foundations with assets of $50 million or more, you will be paid
compensation of 1.00% on sales to $4 million, plus 0.50% on amounts
over $4 million up to $10 million, plus 0.25% on amounts over $10
million. No compensation is paid on any other sales of shares at net
asset value, except that compensation may be paid on sales of fund
shares to accounts managed by affiliates of The Capital Group
Companies, Inc. as set forth in this Agreement. Sales of shares of
Washington Mutual Investors Fund below $1 million made in connection
with certain accounts established before September 1, 1969 are subject
to reduced compensation and sales charges as described in the
Washington Mutual Investors Fund Prospectus. With respect to sales of
shares of any tax-exempt fund, the compensation schedule for sales of
shares to endowments and foundations or retirement plans of
organizations with assets of $50 million or more is inapplicable. The
schedules of sales charges above apply to single purchases, concurrent
purchases of two or more of the Funds (except those listed in Category
3 on the attached Schedule A), and purchases made under a statement of
intention and pursuant to the right of accumulation, both of which are
described in the Prospectuses.
d. On each purchase order for Class A shares and Class 529-A shares of
Funds listed in Category 3 on the attached Schedule A, no compensation
will be paid.
3. Compensation on Sales of Class B Shares and Class 529-B Shares
a. On purchase orders for Class B shares and Class 529-B shares of Funds
listed in Category 1 and Category 2 on the attached Schedule A that are
accepted by us and for which you are responsible, you will be paid: o
compensation of 3.75% of the amount invested, plus o an immediate
service fee of 0.25% of the amount invested.
b. On purchase orders for Class B shares and Class 529-B shares of Funds
listed in Category 3 on the attached Schedule A, no compensation will
be paid.
4. Ongoing Service Fees for Class A, Class 529-A, Class B and Class 529-B
Shares We are also authorized to pay you continuing service fees each
quarter with respect to the Class A, Class 529-A, Class B and Class 529-B
shares of all the Funds to compensate you for providing certain services to
your clients, subject to your compliance with the following terms, which
may be revised by us from time to time. Your eligibility to continue
receiving this compensation will be evaluated periodically, and your
failure to comply with the terms below may result in our discontinuing
service fee payments to you. Initial qualification does not assure
continued participation, and this service fee program may be amended or
terminated by us at any time as indicated below.
a. You agree to cooperate as requested with programs that we
provide to enhance shareholder service. You also agree to
assume an active role in providing shareholder services such
as processing purchase and redemption transactions,
establishing shareholder accounts, and providing certain
information and assistance with respect to the Funds.
Redemption levels of shareholder accounts assigned to you will
be considered in evaluating your continued participation in
this service fee program.
b. You agree to support our marketing efforts by granting
reasonable requests for visits to your offices by our
wholesalers and, to the extent applicable, by including all
Funds covered by this Agreement on your "approved" list.
c. You agree to assign an individual to each shareholder account
on your books and to reassign the account should that
individual no longer be assigned to the account. You agree to
instruct each such individual to regularly contact
shareholders having accounts so assigned.
d. You agree to pass through either directly or indirectly to the
individual(s) assigned to such accounts a share of the service
fees paid to you pursuant to this Agreement. You recognize
that the service fee is intended to compensate the individual
for providing, and encourage the individual to continue to
provide, service to the account holder.
e. You acknowledge that (i) all service fee payments are subject
to the limitations contained in each Fund's Plan of
Distribution and may be varied or discontinued at any time,
(ii) in order to receive a service fee for a particular
quarter, the fee must amount to at least $100, and (iii) no
service fees will be paid on shares purchased under the net
asset value purchase privilege as described in the Funds'
statements of additional information.
f. On Class A, Class 529-A, Class B and Class 529-B shares of
Funds listed in Category 1 and Category 2 on the attached
Schedule A, we will pay you a quarterly service fee at the
following annual rates, based on the average daily net asset
value of Class A, Class 529-A, Class B and Class 529-B shares,
respectively, that have been invested for 12 months and are
held in an account assigned to you at the end of the quarter
for which payment is made:
Annual Service Fee Rate
Shares with a first anniversary of purchase before 7-1-88* 0.15%
Shares with a first anniversary of purchase on or after 7-1-88 0.25%
Shares of state-specific tax-exempt funds 0.25%
g. On Class A, Class 529-A, Class B and Class 529-B shares of
Funds listed in Category 3 on the attached Schedule A, we will
pay you a quarterly service fee at the following annual rates,
based on the average daily net asset value of Class A, Class
529-A, Class B and Class 529-B shares, respectively, that have
been invested for 12 months and are held in an account
assigned to you at the end of the quarter for which payment is
made:
Annual Service Fee Rate
All Shares 0.15%
5. Compensation on Sales of Class C Shares and Class 529-C Shares
a. On purchase orders for Class C shares and Class 529-C shares
of Funds listed in Category 1 and Category 2 on the attached
Schedule A that are accepted by us and for which you are
responsible, we will pay you: o compensation of 0.75% of the
amount invested, plus o an immediate service fee of 0.25% of
the amount invested.
*Except U.S. Government Securities Fund, which pays service
fees at the 0.25% rate on all shares held at least 12 months.
May 2002 3
b. In addition, we will pay you ongoing compensation on a
quarterly basis at the annual rate of 1.00% of the average
daily net asset value of Class C shares and Class 529-C shares
of Funds listed in Category 1, Category 2 and Category 3 on
the attached Schedule A that have been invested for 12 months
and are held in an account assigned to you at the end of the
quarter for which payment is made. The payment of this ongoing
compensation is subject to the limitations contained in each
Fund's Plan of Distribution and may be varied or discontinued
at any time.
6. Compensation on Sales of Class 529-E Shares
We will pay you ongoing compensation on a quarterly basis at the annual
rate of 0.50% of the average daily net asset value of Class 529-E shares of
Funds listed in Category 1, Category 2 and Category 3 on the attached
Schedule A that are held in an account assigned to you at the end of the
quarter for which payment is made. The payment of this ongoing compensation
is subject to the limitations contained in each Fund's Plan of Distribution
and may be varied or discontinued at any time.
7. Retirement Plan Share Classes (R shares) and Account Options (for
retirement plans only)
a. We will pay you ongoing compensation on a quarterly basis, at the
applicable annual rate set forth below, of the average daily net asset
value of R shares of Funds listed in Category 1, Category 2 and
Category 3 on the attached Schedule A that are held in a retirement
plan (Plan) account assigned to you at the end of the quarter for
which payment is made. The payment of this ongoing compensation is
subject to the limitations contained in each Fund's Plan of
Distribution and may be varied or discontinued at any time. We expect
that you will maintain one account for each of your Plan customers on
the books of the Funds.
R Share Class Annual Compensation Rate
Class R-1 1.00%
Class R-2 0.75%
Class R-3 0.50%
Class R-4 0.25%
Class R-5 No compensation paid
b. If you hold Plan accounts in an omnibus account (i.e., multiple Plans
in one account on the books of the Funds), Plans that are added to the
omnibus account after May 15, 2002 may invest only in R shares, and you
must execute an Omnibus Addendum to the Selling Group Agreement, which
you can obtain by calling our Dealer Support department, extension
34222.
8. Order Processing
Any order by you for the purchase of shares of the respective Funds through
us shall be accepted at the time when it is received by us (or any
clearinghouse agency that we may designate from time to time), and at the
offering and sale price next determined, unless rejected by us or the
respective Funds. In addition to the right to reject any order, the Funds
have reserved the right to withhold shares from sale temporarily or
permanently. We will not accept any order from you that is placed on a
conditional basis or subject to any delay or contingency prior to
execution. The procedure relating to the handling of orders shall be
subject to instructions that we shall forward from time to time to all
members of the Selling Group. The shares purchased will be issued by the
respective Funds only against receipt of the purchase price, in collected
New York or Los Angeles Clearing House funds subject to deduction of all
compensation on such sale (reallowance of any compensation to which you are
entitled on purchases at net asset value will be paid through our direct
purchase
compensation system). If payment for the shares purchased is not received
within three days after the date of confirmation the sale may be cancelled
forthwith, by us or by the respective Funds, without any responsibility or
liability on our part or on the part of the Funds, and we and/or the
respective Funds may hold you responsible for any loss, expense, liability
or damage, including loss of profit suffered by us and/or the respective
Funds resulting from your delay or failure to make payment as aforesaid.
9. Timeliness of Submitting Orders
You are obliged to date and indicate the time of receipt of all orders you
receive from your customers and to transmit promptly all orders to us in
time to provide for processing at the price next determined after receipt
by you, in accordance with the Prospectuses. You are not to withhold
placing with us orders received from any customers for the purchase of
shares. You shall not purchase shares through us except for the purpose of
covering purchase orders already received by you, or for your bona fide
investment.
10. Repurchase of Shares
If any share is repurchased by any of the Funds or is tendered thereto for
redemption within seven business days after confirmation by us of the
original purchase order from you for such security, you shall forthwith
refund to us the full compensation paid to you on the original sale.
11. Processing Redemption Requests
You shall not purchase any share of any of the Funds from a record holder
at a price lower than the net asset value next determined by or for the
Funds' shares. You shall, however, be permitted to sell any shares for the
account of a shareholder of the Funds at the net asset value currently
quoted by or for the Funds' shares, and may charge a fair service fee for
handling the transaction provided you disclose the fee to the record owner.
12. Prospectuses and Marketing Materials
We shall furnish you without charge reasonable quantities of offering
Prospectuses (including any supplements currently in effect) current
shareholder reports of the Funds, and sales materials issued by us from
time to time. In the purchase of shares through us, you are entitled to
rely only on the information contained in the offering Prospectus(es). You
may not publish any advertisement or distribute sales literature or other
written material to the public that makes reference to us or any of the
Funds (except material that we furnished to you) without our prior written
approval.
13. Effect of Prospectus
This Agreement is in all respects subject to statements regarding the sale
and repurchase or redemption of shares made in offering Prospectuses of the
Funds, which shall control and override any provision to the contrary in
this Agreement.
14. Relationship of Parties
You shall make available shares of the Funds only through us. In no
transaction (whether of purchase or sale) shall you have any authority to
act as agent for, partner of, or participant in a joint venture with us or
with the Funds or any other entity having either a Bank Selling Group
Agreement or other Agreement with us.
May 2002 5
15. State Securities Qualification
We act solely as agent for the Funds and are not responsible for qualifying
the Funds or their shares for sale in any jurisdiction. Upon written
request we will provide you with a list of the jurisdictions in which the
Funds or their shares are qualified for sale. We also are not responsible
for the issuance, form, validity, enforceability or value of Fund shares.
16. Representations
a. You represent that (1) you are (a) a properly registered or licensed
broker or dealer under applicable federal and state securities laws and
regulations, a member of the National Association of Securities
Dealers, Inc. (NASD), and your membership with the NASD is not
currently suspended or terminated or (b) a "bank" as defined in Section
3(a)(6) of the Securities Exchange Act of 1934 (or other financial
institution) and not otherwise required to register as a broker or
dealer under such Act or any state laws; (2) you are complying with and
will continue to comply with all applicable federal and state laws,
rules and regulations; and (3) to the extent you offer any Class 529
shares, you are permitted by applicable law to offer such shares. You
agree to notify us immediately if any of the foregoing representations
is no longer true to a material extent. You also agree that, if you are
a bank or other financial institution as set forth above, you will
comply with the applicable rules of the NASD, that you will maintain
adequate records with respect to your customers and their transactions,
and that such transactions will be without recourse against you by your
customers. We recognize that, in addition to applicable provisions of
state and federal securities laws, you may be subject to the provisions
of other laws governing, among other things, the conduct of activities
by federal and state-chartered and supervised financial institutions
and their affiliated organizations. Because you will be the only entity
having a direct relationship with the customer in connection with
securities purchases hereunder, you will be responsible in that
relationship for insuring compliance with all applicable federal and
state laws, rules and regulations relating to securities purchases
hereunder.
b. We represent that (a) we are acting as an underwriter within the
meaning of the applicable rules of the NASD and are complying with and
will continue to comply with all applicable federal and state laws,
rules and regulations, (b) we are a member of the NASD and (c) our
membership with the NASD is not currently suspended or terminated. We
agree to notify you immediately if any of the foregoing representations
is no longer true to a material extent.
17. Confidentiality
Each party to this Agreement agrees to maintain all information received
from the other party pursuant to this Agreement in confidence, and each
party agrees not to use any such information for any purpose, or disclose
any such information to any person, except as permitted by applicable laws,
rules and regulations. This provision shall survive the termination of this
Agreement.
18. Termination
Either of us may cancel this Agreement at any time by written notice to the
other.
19. Notices
All communications to us should be sent to the above address. Any notice to
you shall be duly given if mailed or sent by overnight courier to you at
the address specified by you below.
* * * * *
May 2002 7
Execute this Agreement in duplicate and return one of the duplicate originals to
us for our file. This Agreement (i) may be amended by notification from us and
orders received following such notification shall be deemed to be an acceptance
of any such amendment and (ii) shall be construed in accordance with the laws of
the State of California.
Very truly yours,
American Funds Distributors, Inc.
By...........................................................
Xxxxx X. Xxxxxxxx
President
Accepted
...............................................................
Firm
By...........................................................
Print Name _____________________________________
Title __________________________________________
Address:
...............................................................
...............................................................
Date:
...............................................................
Schedule A
May 15, 2002
(supersedes Schedule A dated January 1, 2002)
A B C 529-A 529-B 529-C 529-E R-1 R-2 R-3 R-4 R-5
Category 1
AMCAP Fund o o o o o o o o o o o o
American Balanced Fund o o o o o o o o o o o o
American Mutual Fund o o o o o o o o o o o o
Capital Income Builder o o o o o o o o o o o o
Capital World Growth and Income Fund o o o o o o o o o o o o
EuroPacific Growth Fund o o o o o o o o o o o o
Fundamental Investors o o o o o o o o o o o o
Growth Fund of America o o o o o o o o o o o o
Income Fund of America o o o o o o o o o o o o
Investment Company of America o o o o o o o o o o o o
New Economy Fund o o o o o o o o o o o o
New Perspective Fund o o o o o o o o o o o o
New World Fund o o o o o o o o o o o o
SMALLCAP World Fund o o o o o o o o o o o o
Washington Mutual Investors Fund o o o o o o o o o o o o
Category 2
American High-Income Trust o o o o o o o o o o o o
American High-Income Municipal Bond Fund o o o na na na na na na na na na
Bond Fund of America o o o o o o o o o o o o
Capital World Bond Fund o o o o o o o o o o o o
Intermediate Bond Fund of America o o o o o o o o o o o o
Limited Term Tax-Exempt Bond Fund of America o o o na na na na na na na na na
Tax-Exempt Bond Fund of America o o o na na na na na na na na na
Tax-Exempt Fund of California o o o na na na na na na na na na
Tax-Exempt Fund of Maryland o o o na na na na na na na na na
Tax-Exempt Fund of Virginia o o o na na na na na na na na na
U.S. Government Securities Fund o o o o o o o o o o o o
Category 3
Cash Management Trust of America o e e o e e o o o o o o
Tax-Exempt Money Fund of America o na na na na na na na na na na na
U.S. Treasury Money Fund of America o na na na na na na o o o o o
Notes and symbols
Class F and Class 529-F shares are available pursuant to a separate agreement.
o Share class is available.
e Share class is available for exchanges only.
na Share class is not available.
May 2002 9
