Charitable Gift Program Information

Organization and Purpose

The American Gift Fund (the “Fund”) is a donor advised fund owned by The American Gift Fund (“AGF”), a public charity, which created it to receive, hold and invest gifts to AGF and donate them for a wide variety of charitable purposes. (The Fund and AGF have the same name.)

AGF is organized as a trust and is a public charity exempt from federal income taxation under Sections 501(c)(3) and 509(a)(1) of the Internal Revenue Code. AGF is managed by a Board of Directors which appoints AGF’s trustee. The trustee is First State Trust Company (“First State”), Wilmington, Delaware. See “Administration of AGF” below for additional information.

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Contributions to AGF

Although the Board selects all the charities to which AGF will make grants, AGF has created a charitable gift program in which a person who makes a donation to AGF may recommend to the Board the charities to which AGF will make grants as well as the amounts and dates of such grants. Every contribution is added to the Fund and invested as part of the Fund. Grants are made from the donor’s contributions and the earnings on the investment of those contributions. AGF will establish an account on its books for the donor which tracks the value of the donor’s contributions and their subsequent earnings (see Donors’ Accounts below). However, the contributions and the assets in which AGF invests them remain part of the Fund and are owned by the Fund. The Fund simply maintains a record of them in the donor’s account so it can track them conveniently. The donor can then recommend grants from the Fund up to the total value of the donor’s account. However, AGF is under no obligation to comply with the donor’s recommendation, and all gifts to AGF are irrevocable.

AGF’s charitable gift fund program allows donors to make charitable donations at the times most suitable for them tax-wise but also allows them to request that grants be made from those donations to specific charities at times the donors prefer. Using the Fund also gives donors who otherwise would consider setting up separate private foundations to request that charitable grants be made in amounts and at times the donors want but without the costs and administrative burdens a separate foundation would incur.

Donors may make gifts to AGF for their Fund accounts at any time. The gifts are immediately deductible for federal income, estate or gift tax purposes upon acceptance by AGF. The full value of outright gifts is deductible, subject to ceilings and conditions affecting the donors described in “Tax Considerations” below.

The minimum initial contribution is $25,000 and subsequent contributions must be at least $250. A contribution may be made in cash, securities or other property. Although donors can contribute publicly traded securities to AGF, AGF may also accept certain closely-held or restricted stocks. AGF may accept other investments as well. In any case, AGF will review each gift before accepting it and First State will notify the prospective donor promptly whether the Board accepts or rejects the gift. Gifts must be delivered to AGF in a form and manner acceptable to AGF

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Tax Considerations

Upon acceptance of a donor’s gift by AGF, the donor becomes entitled to a federal income tax and gift tax deduction. A federal estate tax deduction is available for bequests to the Fund and, under certain circumstances, for gifts to the Fund effective at the donor’s death. The donor cannot take a charitable deduction when AGF makes a charitable grant from the Fund because, after the Fund has received the gift from the donor, it owns the gift property so the Fund’s grant is a distribution of its own property, not the donor’s.

The 2025 federal income tax law revisions, among changes affecting charitable deductions, retain the right of an individual donor who itemizes deductions to deduct up to 60% of the donor’s adjusted gross income for cash gifts to AGF and other public charities which are so-called “50% charities” and for tax years beginning in 2026 impose a requirement that an otherwise deducible charitable gift must be reduced by 0.5% of the donor’s contribution base (which is generally the donor’s adjusted gross income for the year). 50% charities include publicly supported organizations as well as certain other charitable organizations. The tax law revisions can complicate determining whether and to what extent a charitable contribution may be deductible so Donors are strongly urged to work with their accountants, attorneys or tax advisors if they have any question about the deductibility of various types of contributions to AGF for federal and state tax purposes, including how the percentage deduction limit works.

No income, gains, losses or other item of income or expense received or incurred by the Fund or recorded in a donor’s account is attributable to the donor because the Fund, not the donor, owns the assets generating such income and expenses.

A donor is responsible for determining the value for tax purposes of his or her donations to AGF. The values of publicly traded securities given to AGF which may be shown on statements issued by AGF to donors are estimates by the trustee only and donors cannot rely on them. Donors must file Form 8283 with their federal income tax returns for gifts of more than $500 of non-cash property. Donors must file a Form 8283 for most charitable gifts of more than $5,000 in non-publicly traded securities and non-cash property.

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Donors’ Accounts

NOTE: Both a pool of a charity’s assets and a donor’s account can be treated by the Internal Revenue Code as a “donor advised fund.” The following information uses the word “account,” not “donor advised fund,” to describe an individual’s Fund account.

Setting Up and Investing an Account

When a donor makes the first contribution, AGF will establish and maintain a book-entry account for the donor on the Fund’s books. AGF will allocate the account’s proportionate share of AGF’s assets to the account but only on AGF’s books. As owner of the assets, AGF will hold them in custody for its own account.

In the donor’s Fund application, the donor may recommend how contributions, including the proceeds from the sale of securities and other property the donor may have contributed, and the earnings on them are to be invested. The investment choices are (a) one or more of AGF’s four investment portfolios or (b) management by a financial or investment advisor the donor recommends which is acceptable to AGF’s trustee. The names and investment objectives of the portfolios are Growth, Preservation, Total Return and ESG. Please see “Investments” below for full information about the investment alternatives.

Account Records

The donor’s account records will include (a) the number of units of the Fund’s investment portfolios or the holdings of other securities in the individually managed portfolio which the donor’s account tracks; (b) the dates and amounts of each contribution by the donor and each grant to a charity the donor recommended and AGF made; and (c) the dates and amounts of all purchases and sales of and dividends received by those units or securities.

AGF will send statements of the account’s tracked holdings and their transactions to the donor quarterly and, with the donor’s permission, will make those statements available securely online at www.giftfund.org.

Donor’s Application

Each donor completes and signs an account application when first making a gift to AGF. The application form is available online at www.giftfund.org. In the application, the donor may:

• Designate the donor or one or more family members or other persons to make recommendations of charitable grants while the donor is living and one or more family members or other persons to make such recommendations in the donor’s place after the donor’s death.
• Recommend one or more charities to receive the balance of the donor’s account at the donor’s death.
• Recommend that the donor’s contributions and reinvestments of dividends be invested in accordance with one of the investment choices described above.
• Name the account using a name selected by the donor and acceptable to AGF. For example, John Doe’s account may be may be named “The John Doe Foundation” or “The Janet Doe Memorial Fund.” If the donor does not choose a name, the account will simply have the donor’s name, for example, “John Doe.”

If the donor is a corporation or other type of organization, AGF will require copies of the organization’s organization documents and additional information identifying the organization’s personnel who are authorized to act in behalf of the organization with respect to the donor’s account, including recommending grants.

Minimum Value of An Account

The value of an account must always be at least $500. If the value falls below that and the donor does not make an additional donation sufficient to meet the minimum after notice from AGF, AGF may donate the assets allocated to the donor’s account to charities or reallocate those assets to the Board of Directors Account. If, after using reasonable efforts, AGF is unable to reach the donor, it may also donate or reallocate those assets as provided above.

First Year Grants from An Account

If, at any time before the first anniversary of a donor’s initial donation, grants from the units allocated to the donor’s account from the donor’s contributions exceed 25% of the donor’s contributions before that date, the Fund reserves the right to pay the trustee a fee from those units equal to 1% of the value of the donor’s contributions utilized for such grants.

Board Of Directors Philanthropic Fund

AGF has established a Board of Directors Philanthropic Fund, an account to which donations that donors prefer not be allocated to their accounts will be allocated. The Board will make grants from that account to one or more charities having one of the charitable purposes determined as provided in “Grants to Charities” below.

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Administration of AGF

AGF’s Board of Directors consists of three members, a majority of whom must be independent of AGF’s trustee, presently First State. The Board appoints the trustee. The Board selects all the charities to which AGF will make grants and fixes the amounts and times of such grants. In addition, the Board has overall responsibility for the Fund’s investments. However, the trustee provides the day-to-day investment management of the Fund’s assets as well as administration of the Fund. The Board of Directors has the right to change the terms of the gift program described in this document at any time or times. Board members serve until their death, resignation, removal or adjudication of incompetency. Vacancies on the Board will be filled by a majority of the remaining independent members.

The Board’s appointment of First State is set forth in a written agreement (the “Appointment Agreement”), the term of which is five years and which began on July 1, 2025. The agreement provides for fees to be paid to First State for its services. See “Fees and Expenses” below. First State replaced AGF’s previous trustee and the fee which AGF pays to First State is less than AGF paid the previous trustee. Before the Board negotiates an extension of the Appointment Agreement, it will compare the administrative and investment management services which First State provides to AGF and the Fund with like services the service providers of other donor advised funds of comparable size which are offered to the public generally provide those funds and the fees they charge those funds. The Board will use publicly available material to obtain its information. Before the Board extends the agreement, it must find that First State’s services and fees are at least competitive with those of the other service providers

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Grants to Charities

Donors may recommend charities to which or charitable purposes for which the Board of Directors will make grants from the donors’ accounts. A donor may either (1) recommend charities which the donor favors, (2) select one or more of AGF’s areas of charitable interest or (3) recommend one or more charities designated by AGF as being focused on those areas of interest. Also, a donor may recommend that his or her gift to the Fund be added to AGF’s Board of Directors Philanthropic Fund.

Recommending Donor’s Favored Charities

A donor may, in a Grant Recommendation, recommend one or more charities to receive grants in amounts up to the balance of the amount in the donor’s account or may cancel a previous request. Each recommended charitable organization must be one described in Section 17O(b)(1) (A) of the Internal Revenue Code, which includes religious, educational, hospital, medical research and governmental charitable organizations at the time of the grant. The Board will review each recommendation both when a donor makes it and at the time AGF is about to distribute the recommended grant to confirm the recommended charity’s status under Section 17O(b)(1)A). Although the Board does not favor making grants to Donor Advised Funds maintained by other charities, the Board will consider making one should a donor recommend it. The Board has the power to approve or disapprove any recommendation.

Areas of Charitable Interest

A donor may, in a grant recommendation, request that a donation be used for grants to organizations whose charitable purposes fall within one or more areas specified by the donor, for example, children’s cancer research, preservation of wilderness or art education. The Board will select the specific charity or charities devoted to the purposes the donor has recommended. The Board will consider every such request, but has the power to disapprove any request.

Amounts and Times of Charitable Grants

A donor may also recommend in the Grant Recommendation the amounts of recommended grants, when the grants should be made and whether the grant should be a lump sum or a series of periodic grants. Periodic grants can be made annually, quarterly or monthly and over any period of time. A periodic grant can be a fixed amount or a percentage of the value of the account. The minimum amount of a single recommended distribution as well as of a fixed periodic distribution is $250. At any time, a donor may also recommend that the entire balance of assets allocated to the donor’ account be distributed. At the donor’s death, after AGF has received satisfactory evidence of the death, it will make the distributions, if any, which the donor recommended be made on that occasion.

The Board has the power to approve or disapprove the amount and timing of any recommended grant. Grants from certain small accounts for which First State has appointed an investment subadvisor (see Other Investment Advisors in Investments below) may be limited to four per calendar quarter.

Unqualified Charity or Disapproved Recommendation

If a charity recommended for a grant from the account charity is not one described in Section 170(b) (1)(A) or the Board does not approve a recommended grant from the account, First State will notify the donor or grant advisor for the donor’s account.

Minimum Average Annual Grants

The purpose of AGF is to promote philanthropy by seeking charitable contributions that can be used to support qualified charitable organizations. AGF expects that its grant distributions from the Fund will exceed 5% of its average net assets for each calendar year on a five-year annual rolling basis. Over the past five years, the percentages were actually 17% in 2020, 20% in 2021, 14% in 2022, 16% in 2023 and 19% in 2024. If grants total than 5%, AGF will identify the accounts with respect to which grants over the same five-year period totaled less than 5% of each account’s average assets. First State will then contact the donor advisors of these accounts to request that they recommend qualified grants of at least the amount by which the 5% exceeds the actual recommendations. If a donor advisor does not comply within 60 days of such request, AGF may make grants to charities from assets tracked in the donor’s account to a charity or charities selected by AGF in the amount by which the 5% exceeds the actual recommendations.

Alternate and Successor Grant Advisors

In the Application or a subsequent DAF succession plan change form, a donor may designate one or two individuals who are at least 18 years old to replace the donor in making recommendations of charities to receive grants. The donor may revoke that authority by written notice to First State. Similarly, a donor may designate one or two individuals who are at least 18 years old to make such recommendations after the donor’s death (once AGF has received satisfactory evidence of the death).

If more than one donor establishes an account, the surviving donors shall have the authority to make and change recommendations. Only the last surviving donor shall have the right to designate a successor to make recommendations after the donors’ deaths.

Grants

One advantage AGF offers is to give donors a way to create endowments, memorials or special funds for charities they prefer without the cost and time of setting up and administering a private foundation. For instance, a scholarship fund can be established, provided grants are made to exempt charitable organizations which administer the scholarship payments from the fund.

Moreover, other persons besides the donor can make gifts to the Fund which can be recorded as part of the donor’s account.

Whenever AGF makes a grant (or makes initial distribution of a periodic payment grant) from the Fund, AGF will notify the charitable recipient of the donor’s name, address and account name, unless the donor has requested anonymity.

Grants can be used only for charitable purposes and not for the benefit of a donor or person having the right to make grant recommendations with respect to a donor’s account. Grants may not be used to satisfy a donor’s or grant advisor’s (or their family’s) legally binding pledge to another charitable organization or other legal obligation or to provide a private benefit to the donor or donor’s grant advisor (or their family), such as paying dues or membership fees for them, purchasing tickets for them to a benefit or purchasing goods for them at charitable auctions. Grants may not be used for lobbying, political contributions or to support political campaigns. Moreover, grants may not be made to an organization described in Section 509(a)(3) of the Internal Revenue Code (a so-called supporting organization) or to a private foundation.

To assure that all grant funds are used exclusively for charitable purposes in accordance with the Fund’s guidelines, AGF will conduct an investigation when it has reason to believe that grant funds are being used for the private benefit of the donor advisor. AGF reserves the right to take appropriate legal action if it determines that grant funds have been diverted for improper purposes.

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Investments

AGF holds all contributions to its donor-advised charitable gift program in the Fund. They are either invested in one or more of the Fund’s four investment portfolios described in “Investment Portfolios” below or First State may employ an investment subadvisor to manage them as described in “Other Investment Advisors” below.

Securities contributed to AGF and awaiting sale are held by the Fund separately.

Investment Portfolios

The four portfolios are Growth, Preservation, Total Return and ESG. The minimum amount of a donor’s initial contribution allocable to an investment objective is $1,000.

• The Growth Portfolio seeks long-term growth of capital by investing primarily in common stocks and securities convertible into such stocks or in mutual funds primarily holding such stocks and securities.
• The Preservation Portfolio seeks to preserve the value of its portfolio and to seek a reasonable level of current income by investing primarily in fixed income obligations or in mutual funds primarily holding such obligations.
• The Total Return Portfolio’s objective is to seek steady growth of capital and current income. Donors’ accounts having this objective will track a mix, determined by First State from time to time, of units of the Growth and Preservation Portfolios. At present, First State determines the proportions of the Growth and Preservation Portfolios which constitute the Total Return Portfolio.
• The ESG Portfolio utilizes an actively managed, globally diversified multi-asset investment approach. Investments selected for this portfolio will integrate Environmental, Social, and Governance (ESG) factors into the security selection process. The portfolio seeks a balance between long-term capital appreciation and preservation.

Any portfolio may utilize shares of money market mutual funds for its short-term investments.

If the donor does not allocate the initial contribution to one or more of the portfolios or no investment subadvisor is appointed for that contribution, First State will make the allocation among the portfolios. Also, if a recommended allocation is less than the $1,000 minimum amount required for a portfolio, First State will notify the donor and make the allocation itself unless the donor responds promptly with an acceptable allocation. Subsequent donations for the donor’s account will be allocated among the portfolios in the same proportions as the account’s current allocation.

The Board of Directors has ultimate responsibility for investment of the Fund’s assets. In order to manage the assets so as to provide for the many charities to which grants from the Fund will be made over optimal periods of time, either the Board or First State may change the allocation of the assets tracked by a donor’s account among the Growth, Total Return, Preservation and ESG objectives at any time or times. Investments in each portfolio are divided into units of equal value on the Fund’s books. Units will be tracked by a donor’s account in proportion to the amount of cash gifts and cash realized from the donor’s gifts which AGF invests in a portfolio. Units representing grants AGF makes from the Fund which are allocated to the account and fees it pays from the Fund and are allocated to the account during a month will be removed from the account at the end of the month.

Other Investment Advisors

If a donor’s account is worth at least $1 million, the account’s donor or donor advisor may recommend that First State engage as its subadvisor a registered investment advisor or broker-dealer the donor or donor advisor has selected to manage investment of the Fund assets the donor’s account tracks. This individualized approach may allow the account’s investments to be tailored more precisely to the schedule of grant recommendations the donor is contemplating. Both First State and the Board will evaluate the recommended firm and determine whether or not First State should hire it. First State will monitor the firm’s investment performance with those assets.

AGF may permit First State to employ other investment advisors as its subadvisors to manage the investments of one or more of the Fund’s four investment portfolios. Such other investment advisors may include affiliates of First State. At present, First State employs and compensates City National Rochdale, LLC to manage the Growth and Preservation Portfolios and RBC Wealth Management, a division of RBC Capital Markets, LLC. to manage the ESG Portfolio. City National Rochdale, LLC and RBC Wealth Management are affiliates of each other.

Initial Investment of Contributions

Donations are normally accepted by AGF when received. AGF will sell donated securities at such times and prices as First State, the trustee, or its subadvisor for the portfolios (if the sale proceeds are to be invested in the portfolios) or for the donor’s account (if the sale proceeds are to be individually managed), as First State or the subadvisor, as the case may be, believes will maximize the sales proceeds it can obtain. The sales price, less costs incurred in connection with the sale, including brokerage commissions and, in the case of securities without a ready market, other expenses, including legal and appraisal fees, will constitute the proceeds of sale.

Please note that the value of donated securities may fluctuate after AGF receives them and before it can sell them and that the Fund will probably incur costs in selling donated securities. Therefore, the value of the donor’s account may be higher or lower than the value of the donor’s gift to AGF.

The proceeds of securities’ sales and donations of cash by donors which are to be invested in the investment portfolios will be held in the Fund until the portfolios’ next valuation date at which time they will be invested in the portfolios. Valuation dates are the only dates on which investments in (and withdrawals from) the portfolios maybe made. At present, the valuation dates are the last day of each month, but First State may at any time select other dates instead.

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FEES AND EXPENSES

Administrative Fees

The Fund’s four investment portfolios pay the Fund an administrative fee at the annual rate of 1.5% of their assets. The fees are calculated and paid at the end of each calendar month in arrears. Payments under the Appointment Agreement are made proportionately from Fund assets allocated to each AGF account.

Each of the Fund’s individually managed assets tracked by donors’ accounts pay the Fund an administrative fee at the annual rates set forth below. Those fees are calculated and paid at the end of each calendar quarter in arrears.