<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
THE GLENMEDE FUND, INC.
- -----------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- -----------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
----------------------------------------------------------------------
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.:
___________________________________________________________________________
3) Filing Party:
___________________________________________________________________________
4) Date Filed:
___________________________________________________________________________
<PAGE>
THE GLENMEDE FUND, INC.
One South Street
Baltimore, Maryland 21202
-----------------------------------------------
NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS
-----------------------------------------------
November 18, 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 the offices of Drinker
Biddle & Reath LLP, 1000 Westlakes Drive, Suite 300, Berwyn, Pennsylvania
19312, on Tuesday, December 9, 1997 at 8:30 a.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 November 12, 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 PORTFOLIO 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 18, 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 the offices of Drinker Biddle
& Reath LLP, 1000 Westlakes Drive, Suite 300, Berwyn, Pennsylvania 19312, on
Tuesday, December 9, 1997, at 8:30 a.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 November 12, 1997, the record date for determining the shareholders
entitled to vote at the Meeting, there were outstanding 22,821,823.099 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 20, 1997 to shareholders of record
on the record date.
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
Report, 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.
<PAGE>
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 initially 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 (or any lesser amount
if, in the opinion of the Portfolio's investment adviser, the investor has
adequate intent and availability of funds to reach a future level of investment
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. 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
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.
2
<PAGE>
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.
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, under the Current Advisory Agreement, the Portfolio pays
no fee. However, 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 maximum annual client fee is presently 1.00% of a client's assets
under management. The actual 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, but are generally under 1.00% of the client's
assets under management. 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 anytime decide to charge an account level fee on these assets.
** As discussed above, it is expected that Institutional Series shares will not
be offered to the public until on or about January 1, 1998.
3
<PAGE>
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.
<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.
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.
4
<PAGE>
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. 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.
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.
5
<PAGE>
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.
<TABLE>
<CAPTION>
Position With Principal
the Advisor Name Occupation
- ----------- ---- ----------
<S> <C> <C>
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.
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 Executive the Advisor.
Officer
</TABLE>
6
<PAGE>
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:
<TABLE>
<CAPTION>
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
- ------------ ------------------- ----------
<S> <C> <C>
Equity Portfolio of Glenmede Fund ............... $140,494,554 0%
Large Cap Value Portfolio of Glenmede Fund ...... $ 71,177,359 0%
</TABLE>
- ------------
1. The Equity and Large Cap Value Portfolios do not currently pay advisory fees
to the Advisor. However, current shareholders of those investment
portfolios are clients of the Advisor and as such are currently 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
7
<PAGE>
$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 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 1988 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.
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
Position
Officer with the Business Experience During
Name Age Since Glenmede Fund Past Five Years
- ---- --- --------- ---------------- ------------------------------------------
<S> <C> <C> <C> <C>
Mary Ann B. Wirtz 46 1988 Executive Executive Vice-President, The Glenmede
Vice-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 1995 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 1995 Secretary Secretary, The Glenmede Portfolios.
Partner in the law firm of Drinker Biddle
& Reath LLP.
Edward J. Veilleux 54 1996 Assistant Assistant Secretary, The Glenmede
Secretary Portfolios. Principal, BT Alex. Brown;
President, Investment Company Capital
Corp. and Armata Financial Corp.
Joseph A. Finelli 40 1995 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 November 12, 1997, the directors and officers of the Glenmede Fund
collectively owned less than 1% of the outstanding shares of the Portfolio.
9
<PAGE>
As of November 12, 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
- ------------------------------- --------------- ------------
The Pew Memorial Trust 9,701,056.995 42.51%
c/o The Glenmede Trust Company
One Liberty Place
1650 Market Street
Suite 1200
Philadelphia, PA 19103
J. Howard Pew Freedom Trust 1,914,486.509 8.39%
c/o The Glenmede Trust Company
One Liberty Place
1650 Market Street
Suite 1200
Philadelphia, PA 19103
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 18, 1997
10
<PAGE>
EXHIBIT A
INVESTMENT ADVISORY AGREEMENT
Agreement made this 1st day of January, 1998 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 objective,
policies and limitations set forth in the Portfolio's prospectus 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 created
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, 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.
A-1
<PAGE>
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.
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.
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 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.
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<PAGE>
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 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.
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 1st day of January,
1998.
ATTEST: THE GLENMEDE FUND, INC.
- ------------------------------------- -------------------------------------
By: By:
Title: Title:
ATTEST: THE GLENMEDE TRUST COMPANY
- ------------------------------------- -------------------------------------
By: By:
Title: Title:
A-3
<PAGE>
ADDITIONAL MATERIALS
Dear :
Enclosed is a notice of a special meeting of shareholders of the Small
Capitalization Equity Portfolio of The Glenmede Fund, Inc. which is the
mutual fund family advised by Glenmede. Also enclosed is a proxy statement
describing the purpose of the special meeting of shareholders. Additional
information and a consent form are also enclosed for independent fiduciaries
of our employee benefit/individual retirement account clients only. Your
account(s) currently holds units of the Small Capitalization Equity
Portfolio as of November 12, 1997.
The purpose of the Proxy and meeting is to solicit your support to change the
fee arrangement within the Portfolio. Currently, there is no investment
management fee within the fund although Glenmede does receive a shareholder
service fee of .05%. Your account(s) is charged a management fee based on its
total assets. What we are proposing is to exclude the Small Capitalization
Portfolio from your account management fee and in its place, put a management
fee within the mutual fund portfolio of .55% (55 basis points). The proxy
statement describes in detail two classes of shares which will be offered. One
is the Institutional series representing shares for institutional investors
with $10 million or more, subject to certain exceptions, and the Advisor
series representing shares that we would like to convert the existing
shareholders into. This Advisor class
will have a shareholder service fee of .25% (25 basis points), making the
total fee to Glenmede .80% (80 basis points).
This fund has higher costs than other Glenmede investment products due to the
specialized approach and extra resources applied to the investment of the
fund. We believe that it is appropriate to ask only those shareholders in this
fund to pay these higher costs. We also note that the new, 0.92% estimated
expense ratio remains well below the average expense ratio of 1.50% for all
Small Cap funds in the Lipper Universe of Bank Related Institutional Small Cap
funds. While we recognize that this represents a departure from our standard
methodology of charging fees to our clients only at the account level, it is
our opinion that this change is the most fair way to resolve this issue.
In addition, this proposal will give us the flexibility to use this fund for
accounts that wish to have our fee imbedded in the fuud, such as Institutional
401(K) Plans.
We feel this proposed fee arrangement is reasonable and competitive for this
specialty equity product. Please be assured that we remain committed to
providing our clients with a high quality portfolio at a reasonable cost. We
would appreciate if you would return this proxy card to us by December 5,
1997, and a return envelope is enclosed for your convenience.
Please call me if you have any questions.
<PAGE>
==============================================================================
THE GLENMEDE FUND, INC.
THIS PROXY IS SOLICITED ON BEHALF OF 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 9, 1997 AT 8:30 A.M. (EASTERN TIME) AT THE OFFICES OF DRINKER BIDDLE &
REATH LLP, 1000 WESTLAKES DRIVE, SUITE 300, BERWYN, PENNSYLVANIA 19312.
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 with The Glenmede
Trust Company.
/ / FOR / / AGAINST / / ABSTAIN
2. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Meeting.
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==============================================================================
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.
==============================================================================
