THE GLENMEDE FUND, INC.
DISTRIBUTION AGREEMENT
AGREEMENT made as of ___________, 1997, by and between THE
GLENMEDE FUND, INC., a Maryland corporation (the "Fund"), and ALEX. XXXXX & SONS
INCORPORATED, a Maryland corporation ("Alex. Xxxxx").
W I T N E S S E T H
WHEREAS, the Fund is registered as an open-end, diversified,
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Fund wishes to appoint Alex. Xxxxx as its
exclusive distributor for the Flag Investors Series Class A Shares ("Shares") of
the Institutional International Portfolio (the "Portfolio") and Alex. Xxxxx
wishes to become the distributor; and
WHEREAS, the compensation to Alex. Xxxxx hereunder and the
payments contemplated by paragraph 9 constitute the financing of activities
intended to result in the sale of Shares, and this Agreement is entered into
pursuant to a "written plan" pursuant to Rule 12b-1 under the 1940 Act (the
"Plan") allowing the Fund to make such payments.
NOW, THEREFORE, in consideration of the premises, and of other
good and valuable consideration by each of the agreements, covenants and
obligations herein contained, the parties hereto agree as follows:
1. Appointment. The Fund appoints Alex. Xxxxx as Distributor
for the Shares for the period and on the terms set forth in this Agreement.
Alex. Xxxxx accepts such appointment and agrees to render the services herein
set forth, for the compensation herein provided.
2. Delivery of Documents. The Fund has furnished Alex. Xxxxx
with copies, properly certified or authenticated, of each of the following:
(a) The Fund's Articles of Incorporation and all
amendments thereto (the "Articles of Incorporation");
(b) The Fund's By-Laws and all amendments thereto
(such By-Laws, as presently in effect and as they shall from time to time be
amended, are herein called the "By-Laws");
(c) Resolutions of the Fund's Board of Directors
authorizing the appointment of Alex. Xxxxx as the Fund's Distributor and
approving this Agreement;
(d) The Fund's notification of Registration filed
pursuant to Section 8(a) of the 1940 Act on Form N-1A under the 1940 Act, as
filed with the Securities and Exchange Commission (the "SEC");
(e) Post-Effective Amendment No. 21 to the Fund's
Registration Statement on Form N-1A under the Securities Act of 1933, as amended
(the "1933 Act") and under the 1940 Act as filed with the SEC and all amendments
thereto; and
(f) The Fund's most recent prospectus for the Shares
(such prospectus and all amendments and supplements thereto are herein called
"Prospectus").
The Fund will xxxxxxx Xxxx. Xxxxx from time to time with
copies, properly certified or authenticated, of all amendments or supplements to
the foregoing, if any, and all documents, notices and reports filed with the
SEC.
3. Duties as Distributor. Alex. Xxxxx agrees that all
solicitations for subscriptions for Shares of the Fund shall be made in
accordance with the Fund's Articles of Incorporation and By-Laws, and its then
current Registration Statement, Prospectus and Statement of Additional
Information, and shall not at any time or in any manner violate any provisions
of the laws of the United States or of any State or other jurisdiction in which
solicitations are then being made. In carrying out its obligations hereunder,
Alex. Xxxxx shall undertake the following actions and responsibilities:
(a) receive orders for purchase of Fund Shares,
accept or reject such orders on behalf of the Fund in accordance with the
currently effective Prospectus and Statement of Additional Information and
transmit such orders as are so accepted to the Fund's transfer agent as promptly
as possible;
(b) receive requests for redemption from holders of
Fund Shares and transmit such redemption requests to the Fund's transfer agent
as promptly as possible;
(c) respond to inquires from the Fund's shareholders
concerning the status of their accounts with the Fund;
(d) provide the Board of Directors of the Fund with
quarterly reports as required by Rule 12b-1 under the 1940 Act; and
-2-
(e) take, on behalf of the Fund, all actions which
appear to the Fund necessary to carry into effect the distribution of the Shares
and perform such other administrative duties with respect to the Fund Shares as
the Fund's Board of Directors may require.
4. Distribution of Shares. Alex. Xxxxx shall be the exclusive
distributor of the Shares of the Portfolio. It is mutually understood and agreed
that Alex. Xxxxx does not undertake to sell all or any specific portion of the
Fund Shares. The Fund shall not sell any of the Fund Shares except through Alex.
Xxxxx and securities dealers who have valid Agency Distribution Agreements with
Alex. Xxxxx. Notwithstanding the provisions of the foregoing sentence, the Fund
may issue its shares at their net asset value to any shareholder of the Fund
purchasing such Shares with dividends or other cash distributions received from
the Fund pursuant to an offer made to all shareholders.
5. Control by Board of Directors. Any distribution activities
undertaken by Alex. Xxxxx pursuant to this Agreement, as well as any other
activities undertaken by Alex. Xxxxx on behalf of the Fund pursuant hereto,
shall at all times be subject to any directives of the Board of Directors of the
Fund. The Board of Directors may agree, on behalf of the Fund, to amendments to
this Agreement, provided that the Fund must obtain prior approval of the
shareholders of the Fund to any amendment which would result in a material
increase in the amount expended by the Fund.
6. Compliance with Applicable Requirements. In carrying out
its obligations under this Agreement, Alex. Xxxxx shall at all times conform to:
(a) all applicable provisions of the 1940 Act and any
rules and regulations adopted thereunder as amended;
(b) the provisions of the Registration Statement of
the Fund under the 1933 Act and the 1940 Act, and any amendments and supplements
thereto;
(c) the provisions of the Articles of Incorporation
of the Fund, and any amendments thereto;
(d) the provisions of the By-Laws of the Fund;
(e) the rules and regulations of the NASD
Regulations, Inc. ("NASD") and all other self-regulatory organizations
applicable to the sale of investment company shares; and
-3-
(f) any other applicable provisions of state and
federal law.
7. Expenses. The expenses connected with the Fund shall be
allocable between the Fund and Alex. Xxxxx as follows:
(a) Alex. Xxxxx shall furnish, at its expense and
without cost to the Fund, the services of personnel to the extent that such
services are required to carry out their obligations under this Agreement;
(b) Alex. Xxxxx shall, at its own expense and without
cost to the Fund, finance appropriate activities which it deems reasonable that
are primarily intended to result in the sale of the shares, including, but not
limited to, advertising, compensation of underwriters, dealers and sales
personnel, the printing and mailing of prospectuses to other than current
shareholders, and the printing and mailing of sales literature;
(c) the Fund assumes and shall pay or cause to be
paid all other expenses of the Fund, including, without limitation: the fees of
the Fund's investment advisor; the charges and expenses of any registrar, any
custodian or depository appointed by the Fund for the safekeeping of its cash,
portfolio securities and other property, and any stock transfer, dividend or
accounting agent or agents appointed by the Fund; brokers' commissions
chargeable to the Fund in connection with portfolio securities transactions to
which the Fund is a party; all taxes, including securities issuance and transfer
taxes, and corporate fees payable by the Fund to federal, state or other
governmental agencies; the cost and expense of engraving or printing of stock
certificates representing Shares; all costs and expenses in connection with
maintenance of registration of the Fund and its Shares with the SEC and various
states and other jurisdictions (including filing fees and legal fees and
disbursements of Fund counsel); the expenses of printing, including typesetting,
and distributing prospectuses of the Fund and supplements thereto to the Fund's
then current shareholders; all expenses of shareholders' and directors' meetings
(except expenses relating to the materials sent by ICC and its affiliates to the
Board) and of preparing, printing and mailing of proxy statements and reports to
shareholders; fees and travel expenses of directors or members of any advisory
board or committee; all expenses incident to the payment of any dividend,
distribution, withdrawal or redemption, whether in Shares or in cash; charges
and expenses of any outside service used for pricing of the Fund's Shares;
charges and expenses of the Fund's legal counsel, including counsel to the
directors of the Fund who are not "interested persons" of the Fund (as defined
in Section 2(a)(19) of the 1940 Act), and of independent accountants, in
connection with any matter relating to the Fund (except expenses relating to tax
returns); a portion of membership dues of industry
-4-
associations; interest payable on Fund borrowings; postage; insurance premiums
on property or personnel (including, but not limited to, legal claims and
liabilities and litigation costs and any indemnification related thereto); and
all other charges and costs of the Fund's operations unless otherwise explicitly
provided herein.
8. Delegation of Responsibilities. Alex. Xxxxx may, but shall
be under no duty to, perform services on behalf of the Fund which are not
required by this Agreement upon the request of the Fund's Board of Directors.
Payment or assumption by Alex. Xxxxx of any Fund expense that Alex. Xxxxx is not
required to pay or assume under this Agreement shall not relieve Alex. Xxxxx of
any of its obligations to the Fund or obligate Alex. Xxxxx to pay or assume any
similar Fund expense on any subsequent occasions.
9. Compensation. For the services to be rendered and the
expenses assumed by Alex. Xxxxx, the Fund shall pay to Alex. Xxxxx, compensation
at the annual rate of .25% of the average daily net asset value of the
outstanding Shares. Except as hereinafter set forth, continuing compensation
under this Agreement shall be calculated and accrued daily and the amounts of
the daily accruals shall be paid monthly. If this Agreement becomes effective
subsequent to the first day of a month or shall terminate before the last day of
a month compensation for that part of the month this Agreement is in effect
shall be prorated in a manner consistent with the calculations of the fees as
set forth above. Payment of Alex. Xxxxx'x compensation for the preceding month
shall be made as promptly as possible.
10. Compensation for Servicing Shareholder Accounts. The Fund
acknowledges that Alex. Xxxxx may compensate its investment representatives for
opening accounts, processing investor letters of transmittals and applications
and withdrawal and redemption orders, responding to inquiries from holders of
Shares concerning the status of their accounts and the operations of the
Portfolio, and communicating with the Fund and its transfer agent on behalf of
holders of Shares.
11. Sub-Distribution Agreements. Alex. Xxxxx may enter into
Sub-Distribution Agreements (the "Sub-Distribution Agreements") with any
securities dealer who is registered under the Securities Exchange Act of 1934
and a member in good standing of the NASD, who may wish to act as a
Participating Dealer in connection with the proposed offering. All
Sub-Distribution Agreements shall be in substantially the form of the agreement
attached hereto as Exhibit "A." For processing Share redemption orders,
responding to the inquiries from holders of Shares concerning the status of
their accounts and the operations of the Portfolio and communication with the
Fund, its transfer agent and Alex. Xxxxx, Xxxx. Xxxxx may pay
-5-
each such Participating Dealer an amount not to exceed that portion of the
compensation paid to Alex. Xxxxx hereunder that is attributable to accounts of
holders of Shares who are customers of such Participating Dealer.
12. Non-Exclusivity. The services of Alex. Xxxxx to the Fund
are not to be deemed exclusive and Alex. Xxxxx shall be free to render
distribution or other services to others (including other investment companies)
and to engage in other activities. It is understood and agreed that officers or
directors of Alex. Xxxxx may serve as officers or directors of the Fund, and
that officers or directors of the Fund may serve as officers or directors of
Alex. Xxxxx to the extent permitted by law; and that officers or directors of
Alex. Xxxxx are not prohibited from engaging in any other business activity or
from rendering services to any other person, or from serving as partners,
officers or directors of any other person, or from serving as partners, officers
or directors of any other firm or corporation, including other investment
companies.
13. Confidentiality. Alex. Xxxxx agrees on behalf of itself
and its employees to treat confidentially and as proprietary information of the
Fund all records and other information or data relative to the Fund, its prior,
present or potential shareholders and/or customers of The Glenmede Trust
Company, except after approval in writing by the Fund, which approval shall not
be unreasonably withheld where Alex. Xxxxx may be exposed to civil or criminal
contempt proceedings for failure to comply, when requested to divulge such
information by duly constituted authorities, or when so requested by the Fund.
Alex. Xxxxx further agrees not to use such records, information or data for any
purpose other than the performance of its responsibilities and duties hereunder.
14. Term and Approval. This Agreement shall become effective
at the close of business on the date hereof and shall remain in force and effect
until October 31, 1998 and from year to year thereafter, provided that such
continuance is specifically approved at least annually:
(a) (i) by the Fund's Board of Directors or (ii) by
the vote of a majority of the outstanding voting securities (as defined in
Section 2(a)(42) of the 1940 Act), and
(b) by the affirmative vote of a majority of the
directors who are not "interested persons" of the Fund (as defined in Section
2(a)(19) of the 0000 Xxx) and who do not have a financial interest in the
operation of this Agreement, by votes cast in person at a meeting specifically
called for such purpose.
15. Termination. This Agreement may be terminated at any time,
on sixty (60) days' written notice to the other party
-6-
without the payment of any penalty, (i) by vote of the Fund's Board of
Directors, (ii) by vote of a majority of the directors who are not "interested
persons" of the Fund (as defined in Section 2(a)(19) of the 0000 Xxx) and who do
not have a financial interest in the operation of this Agreement, (iii) by vote
of a majority of the Fund's outstanding voting securities (as defined in Section
2(a)(42) of the 0000 Xxx) or (iv) by Alex. Xxxxx. The notice provided for herein
may be waived by each party. This Agreement shall automatically terminate in the
event of its assignment as defined in Section 2(a)(4) of the 1940 Act.
16. Liability. In the performance of its duties hereunder,
Alex. Xxxxx shall be obligated to exercise care and diligence and to act in good
faith and to use its best efforts within reasonable limits in performing all
services provided for under this Agreement, but shall not be liable for any act
or omission which does not constitute willful misfeasance, bad faith or gross
negligence on the part of Alex. Xxxxx or reckless disregard by Alex. Xxxxx of
its duties under this Agreement.
17. Notices. Any notices under this Agreement shall be in
writing, addressed and delivered or mailed postage-paid to the other parties at
such address as such other party may designate for the receipt of such notice.
Until further notice to the other parties, the addresses of the Fund and Alex.
Xxxxx are as follows:
If to Alex. Xxxxx:
------------------
Alex. Xxxxx & Sons Incorporated
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
If to the Fund:
---------------
The Glenmede Trust Co.
One Liberty Place
0000 Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: The Fund's President
With a copy to:
---------------
Xx. Xxxxxxx X. Xxxxxx
Drinker, Xxxxxx & Xxxxx LLP
Philadelphia National Bank Building
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
18. Questions of Interpretation. Any question of
interpretation of any term or provision of this Agreement having a counterpart
in or otherwise derived from a term or provision of the 1940 Act shall be
resolved by reference to such term or provision of the 1940 Act and to
interpretations thereof if any,
-7-
by the United States courts or in the absence of any controlling decision of any
such court, by rules, regulations or orders of the SEC issued pursuant to the
1940 Act. In addition, where the effect of a requirement of the 1940 Act
reflected in any provision of this Agreement is revised by rule, regulation or
order of the SEC, such provision shall be deemed to incorporate the effect of
such rule, regulation or order. Otherwise the provisions of this Agreement shall
be interpreted in accordance with the laws of Maryland.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed in duplicate by their respective officers as of the day
and year first above written.
[SEAL] THE GLENMEDE FUND INC.
Attest:____________________ By:_______________________________
[SEAL] ALEX. XXXXX & SONS INCORPORATED
Attest:____________________ By:_______________________________
-8-
Exhibit A
THE GLENMEDE FUND, INC.
One Liberty Place
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
SUB-DISTRIBUTION AGREEMENT
______________, 19__
Gentlemen:
Alex. Xxxxx & Sons Incorporated ("Alex. Xxxxx"), a Maryland
corporation, serves as distributor (the "Distributor") of Flag Investors Series
Class A Shares ("Shares") of the Institutional International Portfolio of The
Glenmede Fund, Inc. (the "Fund"). The Fund is an open-end investment company
registered under the Investment Company Act of 1940, as amended (the "Investment
Company Act"). The Fund offers its Shares to the public in accordance with the
terms and conditions contained in its Prospectus. The term "Prospectus" used
herein refers to the prospectus on file with the Securities and Exchange
Commission which is part of the Fund's registration statement under the
Securities Act of 1933 (the "Securities Act"). In connection with the foregoing
you may serve as a participating dealer (and, therefore, accept orders for the
purchase or redemption of Shares, respond to shareholder inquiries and perform
other related functions) on the following terms and conditions:
1. Participating Dealer. You are hereby designated a
Participating Dealer and as such are authorized (i) to accept orders for the
purchase of Shares and to transmit to the Fund such orders and the payment made
therefore, (ii) to accept orders for the redemption of Shares and to transmit to
the Fund such orders and all additional material, including any certificates for
Shares, as may be required to complete the redemption and (iii) to assist
shareholders with the foregoing and other matters relating to their investments
in the Fund, in each case subject to the terms and conditions set forth in the
Fund's Prospectus. You are to review each Share purchase or redemption order
submitted through you or with your assistance for completeness and accuracy. You
further agree to undertake from time to time certain shareholder servicing
activities for customers of yours who have purchased Shares and who use your
facilities to
communicate with the Fund or to effect redemptions or additional purchases of
Shares.
2. Limitation of Authority. No person is authorized to make
any representations concerning the Fund or the Shares except those contained in
the Fund's Prospectus and in such printed information as the Distributor may
subsequently prepare. No person is authorized to distribute any sales material
relating to the Fund without the prior written approval of the Distributor.
3. Compensation. As compensation for such services, you will
look solely to the Distributor, and you acknowledge that the Fund shall have no
direct responsibility for any compensation. In addition to any sales charge
payable to you by your customer pursuant to a Prospectus, the Distributor will
pay you no less often than annually a shareholder processing and service fee (as
we may determine from time to time in writing) computed as a percentage of the
average daily net asset value of Shares maintained during the preceding period
by shareholders who purchase their Shares through you or with your assistance,
provided that said net asset value is at least $250,000 for which you are to be
compensated, and provided that in all cases your name is transmitted with each
shareholder's purchase order.
4. Prospectus and Reports. You agree to comply with the
provisions contained in the Securities Act governing the distribution of
prospectuses to persons to whom you offer Shares. You further agree to deliver,
upon our request, copies of any amended Prospectus of the Fund to purchasers
whose Shares you are holding as record owner and to deliver to such persons
copies of the annual interim reports and proxy solicitation materials of the
Fund. We agree to furnish to you as many copies of the Fund's Prospectus, annual
and interim reports and proxy solicitation materials as you may reasonably
request.
5. Qualifications to Act. You represent that you are a member
in good standing of NASD Regulations, Inc. (the "NASD"). Your expulsion or
suspension from the NASD will automatically terminate this Agreement on the
effective date of such expulsion or suspension. You agree that you will not
offer Shares to persons in any jurisdiction in which you may not lawfully make
such offer due to the fact that you have not registered under, or are not exempt
from, the applicable registration or licensing requirements of such
jurisdiction. You agree that in performing the services under this Agreement,
you at all times will comply with the Rules of Fair Practice of the NASD,
including, without limitation, the provisions of Section 26 of such Rules. You
agree that you will not combine customer orders to reach breakpoints in
commissions for any purposes whatsoever unless authorized by the then current
Prospectus in respect of Shares of a particular class or by us in writing. You
also agree that you
-2-
will place orders immediately upon their receipt and will not withhold any order
so as to profit therefrom. In determining the amount payable to you hereunder,
we reserve the right to exclude any sales which we reasonably determine are not
made in accordance with the terms of the Prospectus and provisions of the
Agreement.
6. Blue Sky. The Fund has registered an indefinite number of
Shares under the Securities Act. The Fund intends to register or qualify in
certain states where registration or qualification is required. We will inform
you as to the states or other jurisdictions in which we believe the Shares have
been qualified for sale under, or are exempt from the requirements of, the
respective securities laws of such states. You agree that you will offer Shares
to your customers only in those states where such Shares have been registered,
qualified, or an exemption is available. We assume no responsibility or
obligation as to your right to sell Shares in any jurisdiction. We will file
with the Department of State in New York a State Notice and a Further State
Notice with respect to the Shares, if necessary.
7. Authority of Fund. The Fund shall have full authority to
take such action as it deems advisable in respect of all matters pertaining to
the offering of its Shares, including the right not to accept any order for the
purchase of Shares.
8. Record Keeping. You will (i) maintain all records required
by law to be kept by you relating to transactions in Shares and, upon request by
the Fund, promptly make such of these records available to the Fund as the Fund
may reasonably request in connection with its operations and (ii) promptly
notify the Fund if you experience any difficulty in maintaining the records
described in the foregoing clauses in an accurate and complete manner.
9. Liability. The Distributor shall be under no liability to
you except for lack of good faith and for obligations expressly assumed by them
hereunder, and the Fund shall have no liability to you in connection with the
matters to which this Agreement relates. In carrying out your obligations, you
agree to act in good faith and without negligence. Nothing contained in this
Agreement is intended to operate as a waiver by the Distributor or you of
compliance with any provision of the Investment Company Act, the Securities Act,
the Securities and Exchange Act of 1934, as amended, or the rules and
regulations promulgated by the Securities and Exchange Commission thereunder.
10. Term and Termination. This Agreement will become effective
on the date first above written. Unless sooner terminated, this Agreement will
continue until October 31, 199_, and thereafter will continue automatically for
successive annual
-3-
periods provided such continuance is approved at least annually by a majority of
(i) the Fund's Board of Directors and (ii) those Disinterested Directors (as
defined in the last sentence of this Section). This Agreement may be terminated
by either party, without penalty, upon ten days' notice to the other party and
shall automatically terminate in the event of its assignment (as defined in the
Investment Company Act). This Agreement may also be terminated at any time
without penalty by the vote of a majority of the members ("Disinterested
Members") of the Board of Directors of the Fund who are not "interested persons"
(as defined in the Investment Company Act) and who have no direct or indirect
financial interest in the operation of the Distribution Agreement between the
Fund and the Distributor or by the vote of a majority of the outstanding voting
securities of the Fund.
11. Communications. All communications to us should be sent to
Xxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000. Any notice to you shall be duly
given if mailed or telegraphed to you at the address specified by you below.
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us one copy of this agreement.
ALEX. XXXXX & SONS INCORPORATED
(Authorized Signature)
____________________________________
Confirmed and Accepted:
Firm Name: _____________________
By: _____________________
Address: _____________________
Date: _____________________
-4-
