<PAGE>
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[x] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-
12
The Glenmede Fund, Inc.
- ------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a- 6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction
applies:
- ------------------------------------------------------------------------------
<PAGE>
(2) Aggregate number of securities to which transaction applies:
- ------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (Set forth the amount on which
the filing fee is calculated and state how it was determined):
- ------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- ------------------------------------------------------------------------------
(5) Total fee paid:
- ------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials:
- ------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
---------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
THE GLENMEDE FUND, INC.
One South Street
Baltimore, Maryland 21202
----------------
NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS
----------------
November __, 1997
To the Shareholders of the
Small Capitalization Equity Portfolio:
A Special Meeting of Shareholders of the Small
Capitalization Equity Portfolio of The Glenmede Fund, Inc. will be held at
______________________________, on _______________________ December __, 1997
at _____ a.m./p.m. (Eastern time), for the following purposes:
1. To approve or disapprove a new Investment Advisory
Agreement with The Glenmede Trust Company; and
2. To transact such other business as may properly
come before the meeting or any adjournment or
postponement thereof.
The subject referred to above is discussed in the Proxy
Statement attached to this Notice. Each shareholder is invited to attend the
Special Meeting in person. Shareholders of record at the close of business on
____________, 1997 are entitled to receive notice of and to vote at the
Special Meeting. IF YOU CANNOT BE PRESENT AT THE SPECIAL MEETING, WE URGE YOU
TO FILL IN, SIGN, AND PROMPTLY RETURN THE ENCLOSED PROXY IN THE ENVELOPE
PROVIDED, WHICH IS ADDRESSED FOR YOUR CONVENIENCE AND NEEDS NO POSTAGE IF
MAILED IN THE UNITED STATES. IN ORDER TO AVOID THE ADDITIONAL EXPENSE TO THE
FUND OF FURTHER SOLICITATION, WE ASK YOUR COOPERATION IN COMPLETING AND
RETURNING YOUR PROXY PROMPTLY.
Michael P. Malloy
Secretary
<PAGE>
A SPECIAL MEETING OF SHAREHOLDERS
OF
THE GLENMEDE FUND, INC.
One South Street
Baltimore, Maryland 21202
----------------
PROXY STATEMENT
----------------
November __, 1997
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors of The Glenmede Fund, Inc.
(the "Glenmede Fund") for use at a Special Meeting of Shareholders of the
Small Capitalization Equity Portfolio (the "Portfolio") to be held at
___________________, on ____________, December __, 1997, at _____ a.m./p.m.
(Eastern time), and at any adjournment or postponement thereof (the
"Meeting").
Any person giving a proxy may revoke it at any time prior to
its use. Signed proxies received by the Glenmede Fund in time for voting and
not so revoked will be voted in accordance with the directions specified
therein. The Board of Directors recommends a vote FOR the approval of the new
Investment Advisory Agreement with The Glenmede Trust Company.
Costs of soliciting proxies and of this Special Meeting of
Shareholders will be borne by the Portfolio. It is anticipated that banks,
brokerage houses, and other custodians will be requested on behalf of the
Portfolio to forward solicitation material to their principals to obtain
authorizations for the execution of proxies. In addition to soliciting proxies
by use of the mails, some of the officers of Glenmede Fund and persons
affiliated with The Glenmede Trust Company, the Fund's investment advisor,
may, without remuneration, solicit proxies personally or by telephone or
telefax.
On ____________, 1997, the record date for determining the
shareholders entitled to vote at the Meeting, there were outstanding
__________ shares of common stock, constituting all of the Portfolio's
outstanding voting securities. Each share of common stock is entitled to one
vote and each fractional share to a proportionate fractional vote. This Proxy
Statement, the accompanying Notice of a Special Meeting of Shareholders, and
the enclosed proxy are being mailed on or about November 17, 1997 to
shareholders of record on the record date.
<PAGE>
The Portfolio prepares and mails to its shareholders
financial reports on a semi-annual basis. The Portfolio will furnish to
shareholders upon request, without charge, copies of its Annual Report,
containing audited financial statements for the fiscal year ended October 31,
1996, and its Semi-Annual Reports containing unaudited financial statements,
for the period ended April 30, 1997. Requests for such Annual and Semi-Annual
Reports should be directed to One South Street, Baltimore, Maryland 21202 or
telephone toll-free (800) 442-8299. The Annual and Semi-Annual Reports are not
to be regarded as proxy soliciting material.
PROPOSAL 1
APPROVAL OR DISAPPROVAL OF A NEW INVESTMENT ADVISORY AGREEMENT
Background
At a special meeting of the Board of Directors of Glenmede
Fund on October 24, 1997, the directors approved a restructuring of the
Portfolio. In the restructuring, a new class of shares would be added to the
Portfolio named the "Institutional Series" shares, the existing class of
shares would be renamed the "Advisor Series" shares, and a new Investment
Advisory Agreement (the "New Advisory Agreement") with an advisory fee would
be adopted for the Portfolio.
The two classes of shares will be the same except for the
amount of shareholder servicing fees and the minimum initial investment
requirements. The Institutional Series shares will have a .05% shareholder
servicing fee and a minimum initial investment requirement of $10 million. The
Advisor Series shares will have a .25% shareholder servicing fee and no
minimum initial investment requirement. Initially, all current investors will
be in the Advisor Series, except that current investors with assets of $10
million or more will exchange into the Institutional Series. Pending
shareholder approval of the New Advisory Agreement, it is expected that the
restructuring will take place on or about January 1, 1998.
The Glenmede Trust Company (the "Advisor") serves as the
Portfolio's investment adviser pursuant to an advisory agreement dated March
4, 1991 (the "Current Advisory Agreement"). At the Meeting, shareholders will
be asked to approve the New Advisory Agreement. If approved by the
shareholders at this Meeting, effective on or about January 1, 1998, the
Portfolio would pay the Advisor pursuant to the terms of the New Advisory
Agreement a fee, calculated daily and payable monthly, at the annual rate of
.55% of the Portfolio's average daily net assets. The terms and conditions of
the New Advisory Agreement are otherwise substantially the same as the Current
Advisory
-2-
<PAGE>
Agreement. A copy of the New Advisory Agreement is attached as Exhibit A.
The New Advisory Agreement is being entered into to provide
for an investment advisory fee payable to the Advisor by the Portfolio. The
Current Advisory Agreement provides that the Portfolio will pay no investment
advisory fee to the Advisor for the services performed under this Agreement.
However, all current shareholders are clients of the Advisor, and as the
Advisor's clients pay the Advisor fees, including advisory fees, which vary
depending on the capacity in which the Advisor provides fiduciary and
investment services to the particular client (e.g., personal trust, estate
settlement, advisory and custodian services). If shareholders approve the New
Advisory Agreement, the Advisor does not currently anticipate charging an
account level investment advisory fee on client assets invested in the
Portfolio. The Advisor, however, may at any time decide to charge an account
level fee on these assets.
At a meeting of Glenmede Fund's Board of Directors held on
October 24, 1997, the directors, including all of the directors who are not
"interested persons" of Glenmede Fund or the Advisor, voted unanimously to
approve the New Advisory Agreement. If approved by the shareholders at the
Meeting, the New Advisory Agreement would take effect on or about January 1,
1998.
The Current Advisory Agreement was last approved by the
directors on September 10, 1997, when the directors, including a majority of
those directors who are not "interested persons" of Glenmede Fund or the
Advisor, approved its continuation for a twelve month period commencing
November 1, 1997. The Current Advisory Agreement was last approved by the
shareholders on March 30, 1992.
Description of the Provisions of the Current Advisory Agreement
Which Will be Changed in the New Advisory Agreement
The terms of the New Advisory Agreement are the same in all
material respects as the terms of the Current Advisory Agreement, except as
follows:
1. Portfolio Advisory Fee. Under the Current Advisory
Agreement, the Portfolio pays no fee. However, as stated above, current
shareholders in the Portfolio are clients of the Advisor, and pay fees
directly to the Advisor for fiduciary, trust and/or advisory services (e.g.,
personal trust, estate, advisory, tax and custodian services). The actual
annual fee charged by the Advisor to its clients for such services varies
depending on a number of factors, including the particular services provided
to the client.
-3-
<PAGE>
Under the New Advisory Agreement, the advisory fee would be
calculated daily and payable monthly at the annual rate of .55% of the
Portfolio's average daily net assets. Once the Portfolio has instituted the
investment advisory fee, the Advisor does not currently anticipate charging an
account level investment advisory fee on client assets invested in the
Portfolio. The Advisor, however, may at any time decide to charge an account
level fee on these assets. If the New Advisory Agreement had been in effect in
1996, the advisory fee would have been $1,379,540.
The following table illustrates the expenses and fees
incurred by the Portfolio under the terms of the Current Advisory Agreement
for the fiscal year ended October 31, 1996, and compares them to the expenses
and fees the Portfolio would have incurred if the New Advisory Agreement had
been in effect during the same period:
Annual Portfolio Operating Expenses
(as a percentage of net assets)
Current New
Advisory Advisory
Agreement Agreement
--------- ---------
Investment Advisory Fee 0.00% 0.55%
Administration Fee 0.04% 0.04%
Other Expenses
Institutional Series* N/A 0.13%
Advisor Series 0.13% 0.33%
Total Operating Expenses
Institutional Series* N/A 0.72%
Advisor Series 0.17% 0.92%
- ---------
* As discussed above, it is expected that Institutional Series shares
will not be offered to the public until on or about January 1, 1998.
Example: The following illustrates the expenses that an investor would pay on
a $1,000 investment over various time periods assuming (i) a 5% annual rate of
return and (ii) redemption at the end of each time period. The example does
not include fees for fiduciary and investment services which investors pay the
Advisor as clients.
-4-
<PAGE>
<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Current Advisory Agreement
Institutional Series N/A N/A N/A N/A
Advisor Series $ 2 $ 5 $ 10 $ 22
New Advisory Agreement
Institutional Series $ 7 $ 23 $ 40 $ 89
Advisor Series $ 9 $ 29 $ 51 $113
</TABLE>
2. Term. If approved by the Shareholders at this Meeting,
the initial term of the New Advisory Agreement will extend through October 31,
1998, and thereafter shall continue in effect for successive one-year terms
ending on October 31 of each year if approved as described under "Description
of the Provisions of the Current Advisory Agreement and the New Advisory
Agreement That Will Remain Unchanged." The term of the Current Advisory
Agreement expires on October 31 of each year unless approved as described
under "Description of the Provisions of the Current Advisory Agreement and the
New Advisory Agreement That Will Remain Unchanged."
Description of the Provisions of the Current Advisory Agreement
and the New Advisory Agreement That Will Remain Unchanged
Except as described above, the terms and conditions of the
New Advisory Agreement are the same in all material respects as the Current
Advisory Agreement. Set forth below is a summary of the provisions that are
the same in both Agreements.
The advisory agreements provide that the Advisor, subject to
the general supervision of the Board of Directors and in accordance with the
investment objective, policies and restrictions of the Portfolio, will manage
the investment operations of the Portfolio and the composition of the
portfolio of securities and investments (including cash) of the Portfolio. It
is the responsibility of the Advisor to make investment decisions for the
Portfolio and to place purchase and sale orders for portfolio transactions.
The Advisor furnishes a continuous investment program for the Portfolio,
maintains books and records with respect to its securities transactions, and
pays all expenses involved in the management of the Portfolio's investments.
The Advisor pays the salaries, fees and expenses of directors or officers of
the Glenmede Fund who are directors, officers and employees of the Advisor.
The advisory agreements provide that the Advisor shall not be liable to the
Portfolio or any shareholder for anything done or omitted by it except acts or
omissions involving willful misfeasance, bad faith, gross negligence or
reckless disregard of duties imposed upon it by the advisory agreements or for
any losses that may be sustained in the purchase, holding or sale of
securities.
-5-
<PAGE>
Continuance of each agreement for successive one-year terms
must be specifically approved at least annually (i) by the vote of a majority
of the directors who are not parties to the advisory agreement or "interested
persons" (as that term is defined in the 1940 Act) of any such party, and (ii)
by a majority of directors or by a vote of a majority of the outstanding
shares of the Portfolio. Each agreement provides for termination automatically
upon assignment and each are terminable at any time without penalty by the
directors or by a vote of a majority of the Portfolio's outstanding shares, on
60 days' written notice to the Advisor or by the Advisor on 60 days' written
notice to the Portfolio.
Director's Consideration and Recommendation
On October 24, 1997 the New Advisory Agreement was approved
by Glenmede Fund's directors, including all of Glenmede Fund's directors who
are not "interested persons" of Glenmede Fund or the Advisor.
With respect to the approval of the New Advisory Agreement
the directors considered, among other things, the quality of the investment
advisory services that have been provided in the past by the Advisor and the
performance of the Portfolio. The directors also considered that shares of the
Portfolio may be marketed to investors who are not clients of the Advisor. The
directors reviewed the proposed fee and compared it to the fees charged by
other bank-related institutional small cap funds. They took into account other
fees paid by the Portfolio to the Advisor. The directors also considered the
Portfolio's expense ratio and the expense ratio of other bank-related
institutional small cap funds. The directors considered the profitability of
the Advisor, and the fact that the other terms and conditions of the New
Advisory Agreement were the same in all material respects as those in the
Current Advisory Agreement. The Advisor represented to the directors that it
had provided the directors with all the information it believed was necessary
to enable the directors to evaluate the terms of the proposed New Advisory
Agreement. After consideration of all this information and such other items as
were deemed appropriate, the directors concluded that the New Advisory
Agreement contained terms, including the provisions for fees, that were fair
and reasonable to the Portfolio. The directors, including all the directors
who are not interested persons of the Portfolio or of the Advisor, unanimously
approved the New Advisory Agreement. If the New Advisory Agreement is not
approved, the directors will take such actions as deemed appropriate to obtain
investment advice for the Portfolio.
-6-
<PAGE>
Information about the Advisor
The Advisor, a limited purpose trust company chartered in
1956, provides fiduciary and investment services to endowment funds,
foundations, employee benefit plans and other institutions and individuals.
The Advisor is located at One Liberty Place, 1650 Market Street, Suite 1200,
Philadelphia, Pennsylvania 19103. At September 30, 1997, the Advisor had over
$12.6 billion in assets in the accounts for which it serves in various
capacities including as executor, trustee or investment advisor.
The names, position with the Advisor and principal
occupations of the principal executive officer and each director of the
Advisor are as follows. The address for each is c/o Glenmede Trust Company,
One Liberty Place, 1650 Market Street, Suite 1200, Philadelphia, PA 19103.
Position With Principal
the Advisor Name Occupation
----------- ---- ----------
Director Susan W. Catherwood Chairman, Trustee
Board of the Medical
Center of the
University of
Pennsylvania.
Director Richard F. Pew Owner/Operator,
North Ridge Ranches.
Director Thomas W. Langfitt, M.D. Senior Fellow,
Management
Department, Wharton
School of the
University of
Pennsylvania.
Director Arthur E. Pew, III Retired.
Director J. Howard Pew, II None.
Director J.N. Pew, 3rd None.
Director J.N. Pew, IV, M.D. Private Practice of
Internal Medicine.
Director R. Anderson Pew Retired.
Director Ethel Benson Wister None.
Director Rebecca W. Rimel President and CEO,
The Pew Charitable
Trusts.
-7-
<PAGE>
Chairman of the Robert G. Williams Retired.
Board of
Directors
Director G. Thompson Pew, Jr. Investments/
Consulting.
Director and James L. Kermes President and CEO,
Principal the Advisor.
Executive
Officer
The Advisor is a wholly-owned subsidiary of The Glenmede
Corporation (the "Corporation") whose shares are closely held by 74
shareholders. The Corporation has a nine person Board of Directors which, at
September 30, 1997, collectively, owned 98.67% of the Corporation's voting
shares and 37.80% of the Corporation's total outstanding shares. The members
of the Board and their respective interests in the Corporation at June 30,
1997 were as follows:
The Glenmede Corporation Percent of Percent of
Board of Directors Voting Shares Total Shares
- ------------------ ------------- ------------
Susan W. Catherwood........................ 10.83% 1.23%
Richard F. Pew............................. 10.83% 1.07%
Thomas W. Langfitt, M.D.................... 11.07% 8.69%
Arthur E. Pew III.......................... 10.83% 1.07%
J. Howard Pew, II.......................... 10.83% 1.43%
J. N. Pew, III............................. 11.07% 5.45%
J. N. Pew, IV.............................. 11.07% 1.43%
R. Anderson Pew............................ 11.07% 6.03%
Ethel Benson Wister........................ 11.07% 11.40%
------ ------
98.67% 37.80%
The Advisor also acts as investment adviser and/or
sub-adviser to various other registered investment companies. The table below
sets forth certain information with respect to the non-international equity
mutual funds that the Advisor advises:
Annual Rate of
Investment Advisory/
Sub-Advisory Fee
Net Assets as as a Percentage of(1)
Name of Fund of October 31, 1997 Net Assets
- ------------ ------------------- ---------------------
Equity Portfolio $ 0%
Large Cap Value Portfolio $ 0%
-8-
<PAGE>
1. The Equity and Large Cap Value Portfolios do not currently pay
advisory fees to the Advisor but current shareholders of those
investment portfolios are clients of the Advisor and as such subject
to the maximum annual client fee described above.
Other Services
Glenmede Fund has adopted a Shareholder Servicing Plan (the
"Plan") whereby the Portfolio may pay a fee to broker/dealers, banks and other
financial institutions (including the Advisor) that are the dealers of record
or holders of record or which have a servicing relationship ("Servicing
Agents") with the beneficial owners of shares in the Portfolio. Under the
Plan, Servicing Agents enter into Shareholder Servicing Agreements (the
"Agreements") with Glenmede Fund. Pursuant to such Agreements, Servicing
Agents provide shareholder support services to their customers who
beneficially own shares of the Portfolio for a fee, computed monthly based
upon the average daily net assets of the shares beneficially owned by the
customers of such Servicing Agent at the annual rate of .05%. The Advisor has
entered into an Agreement with Glenmede Fund. The Portfolio paid $125,390 in
shareholder servicing fees to the Advisor pursuant to the Plan during the
fiscal year ended October 31, 1996. As discussed above, effective on or about
January 1, 1998 with the restructuring of the Portfolio, Institutional Series
shares will be subject to a .05% shareholder servicing fee and Advisor Series
shares will be subject to a .25% shareholder servicing fee.
2. OTHER MATTERS
No business other than the matter described above is
expected to come before the Meeting, but should any other matter requiring a
vote of shareholders arise, including any question as to an adjournment of the
Meeting, the persons named in the enclosed proxy will vote thereon according
to their best judgment in the interests of the Portfolio.
VOTES REQUIRED FOR APPROVAL OF MATTERS AT THE MEETING
A quorum for the transaction of business at the Meeting is
constituted by the presence in person or by proxy of holders of a majority of
the outstanding shares of the Portfolio. If a Proxy is properly executed and
returned accompanied by instructions to withhold authority, or is marked with
an abstention, the shares represented thereby will be considered to be present
at the Meeting for purposes of determining the existence of a quorum for the
transaction of business.
Approval of the New Advisory Agreement requires the
affirmative vote of the holders of the lesser of: (i) 67% of the
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<PAGE>
shares of the Portfolio present at the meeting if the holders of more than 50%
of the outstanding shares are present in person or by proxy; or (ii) more than
50% of the outstanding shares of the Portfolio.
Broker "non-votes" (i.e., proxies from brokers or nominees
indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular
matter with respect to which the brokers or nominees do not have discretionary
power) will be deemed to be abstentions. Abstentions will have the same effect
as casting a vote against the proposed New Advisory Agreement.
ADDITIONAL INFORMATION
Management
Officers of Glenmede Fund are elected and appointed by the
directors and hold office until they resign or are removed. The following
table sets forth certain information about the Glenmede Fund's executive
officers:
<TABLE>
<CAPTION>
Position
Officer with the Business Experience During
Name Age Since Glenmede Fund Past Five Years
---- --- ----- ------------- --------------------------
<S> <C> <C> <C> <C>
John W. Church, Jr. 64 Chairman, Chairman, President and Trustee of The
President and Glenmede Portfolios; Executive Vice
Director President and Chief Investment Officer of
The Glenmede Trust Company. He has been
employed by The Glenmede Trust Company
since 1979.
Mary Ann B. Wirtz 46 Executive Vice- Executive Vice-President, The Glenmede
President Portfolios. Vice President and Manager
of The Fixed Income Division of The
Glenmede Trust Company. She has been
employed by The Glenmede Trust Company
since 1982.
Kimberly C. Osborne 31 Vice-President Vice-President, The Glenmede Portfolios.
Vice President of The Glenmede Trust
Company. She has been employed by The
Glenmede Trust Company since 1993. From
1992-1993, she was a Client Service
Manager with Mutual Funds Service Company
and from 1987-1992, a Client
Administrator with The Vanguard Group,
Inc.
Michael P. Malloy 38 Secretary Secretary, The Glenmede Portfolios.
Partner in the law firm of Drinker Biddle
& Reath LLP.
Edward J. Veilleux 54 Assistant Assistant Secretary, The Glenmede
Secretary Portfolios. Principal, BT Alex. Brown;
President, Investment Company Capital
Corp. and Armata Financial Corp.
</TABLE>
-10-
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Joseph A. Finelli 40 Treasurer Treasurer, The Glenmede Portfolios. He
has been a Vice President of B.T. Alex.
Brown since 1995. Prior thereto, he was
Vice President and Treasurer of The
Delaware Group.
</TABLE>
As of __________, 1997, the directors and officers of the
Glenmede Fund collectively owned less than 1% of the outstanding shares of the
Portfolio.
As of __________, 1997, the Advisor held of record all of
the outstanding shares of the Portfolio. In addition, as of _______, 1997, the
following persons or entities owned beneficially more than 5% of the
outstanding shares of the Portfolio:
Amount and Percentage of
Outstanding Shares
------------------------
Number of
Name and Address Shares Percentage
- ---------------- --------- ----------
Other Service Providers
Investment Company Capital Corp. ("ICC"), located at
One South Street, Baltimore, Maryland 21202, serves as Glenmede
Fund's administrator, transfer agent and dividend paying agent.
ICC is an indirect subsidiary of Bankers Trust New York
Corporation. ICC Distributors, Inc. (the "Distributor"), located
at P.O. Box 7558, Portland, Maine 04101, serves as Glenmede
Fund's distributor. ICC and the Distributor are unaffiliated.
SHAREHOLDER PROPOSALS
Glenmede Fund does not hold annual meetings. Shareholders
wishing to submit proposals for inclusion in a proxy statement for a
subsequent shareholder meeting should send their written proposals to
Secretary of Glenmede Fund c/o One South Street, Baltimore, Maryland 21202.
Dated: November __, 1997
-11-
<PAGE>
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
Agreement made this ____ day of December, 1997 by and between The
Glenmede Fund, Inc., a Maryland corporation (the "Company"), and The Glenmede
Trust Company, a Pennsylvania corporation (the "Adviser").
1. Duties of Adviser. The Company hereby appoints the Adviser to act
as investment adviser to its Small Capitalization Equity Portfolio (the
"Portfolio") for the period and on such terms set forth in this Agreement. The
Company employs the Adviser to manage the investment and reinvestment of the
assets of the Portfolio to continuously review, supervise and administer the
investment program of the Portfolio, to determine in its discretion the
securities to be purchased or sold and the portion of the Portfolio's assets
to be held uninvested, to provide the Company with records concerning the
Adviser's activities which the Company is required to maintain, and to render
regular reports to the Company's officers and Board of Directors concerning
the Adviser's discharge of the foregoing responsibilities. The Adviser shall
discharge the foregoing responsibilities subject to the control of the
officers and the Board of Directors of the Company and in compliance with the
objectives, policies and limitations set forth in the Portfolio's prospectus
-1-
<PAGE>
and applicable laws and regulations. The Adviser accepts such employment and
agrees to render the services and to provide, at its own expense, the office
space, furnishings and equipment and the personnel required by it to perform
the services on the terms and for the compensation provided herein.
2. Portfolio Transactions. The Adviser is authorized to select the
brokers that will execute the purchases and sales of securities for the
Portfolio and is directed to use its best efforts to obtain the best available
price and most favorable execution, except as prescribed herein. Subject to
policies established by the Board of Directors of the Company, the Adviser may
also be authorized to effect individual securities transactions at commission
rates in excess of the minimum commission rates available, if the Adviser
determines in good faith that such amount of commission is reasonable in
relation to the value of the brokerage or research services provided by such
broker or dealer, viewed in terms of either that particular transaction or the
Adviser's overall responsibilities with respect to the Company and other
accounts as to which the Adviser exercises investment discretion. The
execution of such transactions shall not be deemed to represent an unlawful
act or breach of any duty by this Agreement or otherwise. The Adviser will
promptly communicate to the officers and Directors of the Company such
information relating to portfolio transactions as they may reasonably request.
3. Compensation of the Adviser. For the services provided and the
expenses assumed pursuant to this Agreement, effective as of the date hereof,
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<PAGE>
the Portfolio will pay the Adviser and the Adviser will accept as full
compensation therefor, a fee computed daily and paid monthly (in arrears), at
an annual rate of .55% of the average daily net assets held in the Portfolio.
If in any fiscal year the aggregate expenses of the
Portfolio exceed the expense limitations of any state having jurisdiction over
the Portfolio, the Adviser will reimburse the Portfolio for such excess
expenses. The obligation of the Adviser to reimburse the Portfolio hereunder
is limited in any fiscal year to the amount of its fee hereunder for such
fiscal year, provided however, that notwithstanding the foregoing, the Adviser
shall reimburse the Portfolio for such excess expenses regardless of the
amount of fees paid to it during such fiscal year to the extent that the
securities regulations of any state having jurisdiction over the Portfolio so
requires. Such expense reimbursement, if any, will be estimated, reconciled
and paid on a monthly basis.
4. Other Services. At the request of the Company, the Adviser in its
discretion may make available to the Company office facilities, equipment, and
other services. Such office facilities, equipment, and services shall be
provided for or rendered by the Adviser and billed to the Company at the
Adviser's cost. The Adviser further agrees to assume the cost of printing and
mailing prospectuses to persons other than current shareholders of the Company
and the cost of any other activities primarily intended to result in the sale
of the Company's shares.
-3-
<PAGE>
5. Reports. The Company and the Adviser agree to furnish to
each other current prospectuses, proxy statements, reports to shareholders,
certified copies of their financial statements, and such other information
with regard to their affairs as each may reasonably request.
6. Status of Adviser. The services of the Adviser to the
Company are not to be deemed exclusive, and the Adviser shall be free to
render similar services to others so long as its services to the Company are
not impaired thereby.
7. Liability of Adviser. In the absence of (i) wilful
misfeasance, bad faith or gross negligence on the part of the Adviser in
performance of its obligations and duties hereunder, (ii) reckless disregard
by the Adviser of its obligations and duties hereunder, or (iii) a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services (in which case any award of damages shall be limited
to the period and the amount set forth in Section 36(b)(3) of the Investment
Company Act of 1940 ("1940 Act"), the Adviser shall not be subject to any
liability whatsoever to the Company or to any shareholder of the Company, for
any error or judgment, mistake of law or any other act or omission in the
course of, or connected with, rendering services hereunder including without
limitation, for any losses that may be sustained in connection with the
purchase, holding redemption or sale of any security on behalf of the
Portfolio.
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<PAGE>
8. Permissible Interests. Subject to and in accordance with the
Articles of Amendment and Restatement of the Company and the Articles of
Incorporation of the Adviser, Directors, officers, agents and shareholders of
the Company are or may be interested in the Adviser (or any successor thereof)
as Directors, officers, agents, shareholders or otherwise; Directors,
officers, agents and shareholders of the Adviser are or may be interested in
the Company as Directors, officers, shareholders or otherwise; and the Adviser
(or any successor) is or may be interested in the Company as a shareholder or
otherwise; and that the effect of any such interrelationships shall be
governed by said Articles of Amendment and Restatement or Articles of
Incorporation (as applicable) and the provisions of the 1940 Act.
9. Corporate Name. The Company acknowledges that it has obtained its
corporate name by consent of the Adviser, which consent was given in reliance
and upon the provisions hereafter contained. The Company agrees that if the
Adviser should cease to be the investment adviser of the Company, the Company
will, upon written demand of the Adviser forthwith (a) for a period of two
years after such written demand, state in all prospectuses, advertising
material, letterheads and other material designed to be read by investors or
prospective investors, in a prominent position and in prominent type (as may
be reasonably approved by the Adviser), that The Glenmede Trust Company no
longer serves as the investment adviser of the Company, and (b) delete from
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<PAGE>
its name the word "Glenmede" or any approximation thereof. The Company further
agrees that the Adviser may permit other persons, partnerships (general or
limited), associations, trusts, corporations or other incorporated or
unincorporated groups of persons, including without limitation any investment
company or companies of any type which may be initially sponsored or organized
by the Adviser in the future, to use the word "GLENMEDE" or any approximation
thereof as part of their names. As used in this section, "The Glenmede Trust
Company" and "Adviser" shall include any successor corporation, partnership,
limited partnership, trust or person.
10. Duration and Termination. This Agreement, unless sooner
terminated as provided herein, shall continue until October 31, 1998 and
thereafter shall continue for periods of one year so long as such continuance
is specifically approved at least annually (a) by the vote of a majority of
those members of the Board of Directors of the Company who are not parties to
this Agreement or interested persons of any such party, cast in person at a
meeting called for the purpose of voting on such approval, and (b) by the
Board of Directors of the Company or by vote of a majority of the outstanding
voting securities of the Portfolio; provided however, that if the holders of
the Portfolio fail to approve the Agreement as provided herein, the Adviser
may continue to serve the Portfolio in such capacity in the manner and to the
extent permitted by the Company's Board of Directors and the 1940 Act and
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<PAGE>
Rules thereunder. This Agreement may be terminated by the Company at any time,
without the payment of any penalty, by vote of a majority of the entire Board
of Directors of the Company or by vote of a majority of the outstanding voting
securities of the Portfolio on 60 days' written notice to the Adviser. This
Agreement may be terminated by the Adviser at any time, without the payment of
any penalty, upon 90 days' written notice to the Company. This Agreement will
automatically and immediately terminate in the event of its assignment. Any
notice under this Agreement shall be given in writing, addressed and delivered
or mailed postpaid, to the other party at any office of such party.
As used in this Section 10, the terms "assignment",
"interested persons", and a "vote of a majority of the outstanding voting
securities" shall have the respective meanings set forth in Section 2(a)(4),
Section 2(a)(19) and Section 2(a)(42) of the 1940 Act.
11. Books and Records. In compliance with the requirements
of Rule 31a-3 under the 1940 Act, the Adviser hereby agrees that all records
which it maintains for the Portfolio are the property of the Company and
further agrees to surrender promptly to the Company any of such records upon
the Company's request. The Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records which it maintains for
the Company and are required to be maintained by Rule 31a-1 under the 1940
Act.
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<PAGE>
12. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the Commonwealth of
Pennsylvania.
13. Amendment of Agreement. This Agreement may be amended by
mutual consent, subject to the applicable requirements of the 1940 Act.
14. Severability. If any provisions of this Agreement shall
be held or made invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
IN WITNESS WHEREOF, intending to be legally bound hereby,
the parties hereto have caused this Agreement to be executed as of this ____
day of December, 1997.
ATTEST: THE GLENMEDE FUND, INC:
---------------------- -------------------------
Michael P. Malloy John W. Church, Jr.
Secretary Chairman
THE GLENMEDE TRUST COMPANY:
---------------------- -------------------------
By: By:
Title: Title:
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<PAGE>
FORM OF PROXY CARD
THE GLENMEDE FUND, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE
GLENMEDE FUND, INC. (THE "GLENMEDE FUND") FOR USE AT THE SPECIAL
MEETING OF SHAREHOLDERS OF THE SMALL CAPITALIZATION EQUITY
PORTFOLIO (THE "PORTFOLIO") TO BE HELD ON DECEMBER __, 1997 AT
_____ A.M./P.M. (EASTERN TIME) AT ___________________.
The undersigned hereby appoints John W. Church, Jr. and Michael P.
Malloy, and each of them, with full power of substitution, as proxies of the
undersigned to vote at the above-stated Special Meeting, and all adjournments
thereof, all shares of common stock of the Portfolio held of record by the
undersigned on the record date for the Meeting, upon the following matters,
and upon any other matter which may properly come before the Meeting, at their
discretion.
1. Proposal to approve a New Investment Advisory
Agreement.
____ FOR ____ AGAINST ____ ABSTAIN
2. In their discretion, the proxies are authorized to vote upon
such other business as may properly come before the Meeting.
<PAGE>
Every properly signed proxy will be voted in the manner specified
hereon and, in the absence of specification, will be treated as GRANTING
authority to vote FOR Proposals 1 and 2 above.
PLEASE SIGN, DATE AND RETURN
PROMPTLY. Receipt of Notice of
Special Meeting and Proxy Statement
is hereby acknowledged.
____________________________________
Sign here exactly as name(s)
appear(s) on left
Date:_______________________________
IMPORTANT - Joint owners must EACH
sign. When signing as attorney,
trustee, executor, administrator,
guardian, or corporate officer,
please give your FULL title.
