<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-14
___
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
---
PRE-EFFECTIVE AMENDMENT NO. __
/__/
POST-EFFECTIVE AMENDMENT NO. __
/__/
VAN ECK FUNDS
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
99 PARK AVENUE, NEW YORK, NEW YORK 10016
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
212-687-5200
(REGISTRANT'S TELEPHONE NUMBER)
THADDEUS LESZCZYNSKI, ESQ.
VAN ECK ASSOCIATES CORPORATION
99 PARK AVENUE, NEW YORK, NEW YORK 10016
(NAME AND ADDRESS OF AGENT FOR SERVICE)
COPY TO: PHILIP H. NEWMAN, ESQ., GOODWIN PROCTER & HOAR LLP
EXCHANGE PLACE, BOSTON, MASSACHUSETTS 02109
__________________________________________________________________
APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: AS SOON AS PRACTICABLE AFTER
THE REGISTRATION STATEMENT BECOMES EFFECTIVE UNDER THE SECURITIES ACT OF 1933.
IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE ON THE THIRTIETH DAY
AFTER THE DATE OF FILING PURSUANT TO RULE 488 UNDER THE SECURITIES ACT OF 1933.
NO FILING FEE IS REQUIRED BECAUSE THE REGISTRANT HAS HERETOFORE DECLARED
ITS INTENTION TO REGISTER AN INDEFINITE NUMBER OF SHARES OF BENEFICIAL INTEREST,
$.001 PAR VALUE, OF THE GOLD/RESOURCES FUND SERIES, PURSUANT TO RULE 24F-2(A)(1)
UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE "ACT"). A RULE 24F-2
NOTICE WAS FILED ON OR ABOUT ____________, 1997 FOR THE REGISTRANT.
<PAGE>
VAN ECK FUNDS
Cross-Reference Sheet
Pursuant to Rule 481(a) under the Securities Act of 1933
Form N-14 Item No. Location in Proxy Statement/Prospectus
- ------------------ --------------------------------------
PART A
1. Cover Page of Registration Statement; Prospectus Cover Page
2. Table of Contents
3. Synopsis; Special Considerations and Risk Factors
4. Synopsis, The Reorganization
5. Prospectus Cover Page; Synopsis; Gold/Resources Fund
and Additional Information
6. Prospectus Cover Page; Synopsis; Gold Opportunity Fund;
Additional Information
7. Notice of Special Meeting; Introduction; Synopsis; The
Reorganization; Gold/Resources Fund; Gold Opportunity
Fund; Information Concerning Special Meeting;
Additional Information
8. Not Applicable
9. Not Applicable
PART B
10. Cover Page of Statement of Additional Information
11. Table of Contents
12. General Information
13. General Information
14. Financial Statements
<PAGE>
VAN ECK FUNDS
GOLD/OPPORTUNITY FUND
99 PARK AVENUE, NEW YORK, NEW YORK 10016
1-800-221-2220
______________________________________________
NOTICE OF MEETING OF SHAREHOLDERS
___________ __, 1997
______________________________________________
A MEETING OF SHAREHOLDERS OF THE GOLD OPPORTUNITY FUND SERIES (THE "FUND") OF
VAN ECK FUNDS (THE "TRUST") will be held at 99 Park Avenue, 8th Floor, New York,
New York, on ____________, ________ __, 1997 at __________, New York Time, for
the following purposes:
(1)To consider approval of the Agreement and Plan of Reorganization and
Liquidation involving the exchange of substantially all of the Fund's assets for
shares of Gold/Resources Fund, another series of the Trust, the assumption of
liabilities of the Fund by Gold/Resources Fund, the distribution of such shares
to the Fund's shareholders and the liquidation of the Fund; and
(2)To act upon such other matters as may properly come before the meeting or any
adjournment or adjournments thereof.
Shareholders of record at the close of business on _______ __, 1997 are
entitled to notice of, and to vote at, the meeting or any adjournment thereof.
By order of the Board of Trustees
THADDEUS M. LESZCZYNSKI,
Secretary
May __, 1997
_____________________________________________________________________________
YOUR VOTE IS IMPORTANT!
WHETHER YOU EXPECT TO ATTEND THE MEETING OR NOT, PLEASE COMPLETE,
DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY.
<PAGE>
Investors are advised to read and retain this Proxy Statement/Prospectus for
future reference.
------------------------------------------------------------------------
VAN ECK FUNDS
99 PARK AVENUE, 8TH FLOOR, NEW YORK, NEW YORK 10016
1-800-221-2220
PROXY STATEMENT/PROSPECTUS
Van Eck Funds (the "Trust") has filed a Registration Statement with the
Securities and Exchange Commission for the registration of the Class A shares of
Gold/Resources Fund series of the Trust ("GRF") to be offered to the
shareholders of Gold/Opportunity Fund series of the Trust ("GOF") pursuant to an
Agreement and Plan of Reorganization and Liquidation of the Trust involving the
exchange of GOF's assets, for Class A shares of GRF, the assumption of the
liabilities of GOF by GRF, the distribution of GRF shares to GOF's shareholders
and the subsequent liquidation of GOF (the "Reorganization").
GRF is a diversified series of the Trust, which is an open-end management
investment company, that seeks long-term capital appreciation. GRF attempts to
achieve its investment objective by investing its assets in equity and debt
securities of companies engaged in the exploration, development, production and
distribution of gold and other natural resources such as strategic and other
metals, minerals, oil, natural gas and coal. There can be no guarantee that GRF
will achieve its investment objective.
A copy of the prospectus for GRF and GOF dated April 30, 1997 (the
"Prospectus") and Statement of Additional Information for GRF and GOF, dated
April 30, 1997 (the "Statement of Additional Information") are incorporated by
reference in this Proxy Statement/Prospectus.
This Proxy Statement/Prospectus sets forth concisely information about GRF
and GOF that the shareholders of GOF should know in considering the
Reorganization and should be retained for future reference. GOF has authorized
the solicitation of proxies in connection with the Reorganization solely on the
basis of this Proxy Statement/Prospectus and the accompanying documents.
A Statement of Additional Information relating to the Reorganization (the
"Reorganization Statement of Additional Information"), including historical
financial statements of GRF and GOF, dated May ___, 1997, is incorporated by
reference into this Proxy Statement/Prospectus and is available from the Funds
by calling the telephone number listed above or by writing to the Funds at the
above address.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED ON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
This Proxy Statement/Prospectus is dated May __, 1997
<PAGE>
TABLE OF CONTENTS
Page
----
INTRODUCTION............................................................. 2
SYNOPSIS................................................................. 3
The Reorganization.................................................. 3
Investment Objectives and Policies.................................. 3
Reasons for the Transaction......................................... 4
Investment Advisory Fees............................................ 5
Other Fees.......................................................... 6
Exchange Rights..................................................... 8
Conversion Feature.................................................. 8
Redemption Procedures............................................... 8
Dividends And Distributions......................................... 9
Net Asset Value..................................................... 9
Tax Consequences.................................................... 9
SPECIAL CONSIDERATIONS AND RISK FACTORS.................................. 9
THE REORGANIZATION....................................................... 12
Procedures.......................................................... 12
Terms of The Agreement And Plan of Reorganization................... 12
Benefits to GOF as a Result of Reorganization....................... 13
Tax Consequences of the Reorganization.............................. 14
Capitalization...................................................... 15
GOLD/RESOURCES FUND AND GLOBAL OPPORTUNITY FUND.......................... 16
Financial Highlights................................................ 16
Gold/Resources Fund ........................................... 16
Gold Opportunity Fund.......................................... 17
Management.......................................................... 18
Shares of GRF to Be Issued in The Reorganization And Shares of GOF.. 18
Purchase of Shares.................................................. 19
Redemption Procedures............................................... 20
Other Matters....................................................... 20
INFORMATION CONCERNING THE MEETING....................................... 20
Date, Time And Place of Meeting..................................... 20
Solicitation, Revocation And Use of Proxies......................... 20
Record Date And Outstanding Shares.................................. 20
Security Ownership of Certain Beneficial Owners And Management...... 20
Voting Rights And Required Vote..................................... 21
ADDITIONAL INFORMATION................................................... 21
PLAN OF REORGANIZATION AND LIQUIDATION................................... 22
<PAGE>
VAN ECK FUNDS
GLOBAL OPPORTUNITY FUND
GOLD/RESOURCES FUND
99 Park Avenue, 8th Floor, New York, New York 10016
1-800-221-2220
PROXY STATEMENT/PROSPECTUS
Meeting of Shareholders of Van Eck Funds
To Be Held on ________ __, 1997, ________ A.M.
99 Park Avenue, 8th Floor, New York, New York
INTRODUCTION
This proxy statement is furnished to the shareholders of GOF in connection
with the solicitation by the Board of Trustees of Van Eck Funds (the "Trust") of
which GOF is a series, of proxies to be used at the meeting of shareholders of
GOF to be held on __________, 1997, or any adjournments thereof (the "Meeting"),
to approve or disapprove a Plan of Reorganization and Liquidation (the "Plan")
which contemplates the exchange of assets from GOF for Class A shares of GRF
(the "Reorganization Shares"), the assumption of the liabilities of GOF by GRF,
the distribution of such Reorganization Shares to the shareholders of GOF and
the subsequent liquidation of GOF, as set forth herein (the "Reorganization").
As of _________, 1997, the record date, there were approximately _________
shares of GOF outstanding (representing ______ Class A shares, _______ Class B
shares and _______ Class C shares) and __________ shares of GRF (representing
_______ Class A shares). Each shareholder of GOF will be entitled to one vote
for each share and a fractional vote for each fractional share held on the
record date. It is expected that the mailing of this proxy statement will
commence on or about _________, 1997. GRF and GOF each may be referred to
herein individually as a "Fund" and collectively as the "Funds".
The enclosed form of proxy, if properly executed and returned, will be
voted in accordance with the choice specified thereon. The proxy will be voted
in favor of the proposals unless a choice is indicated to vote against a
proposal. Proxies properly executed and returned, but which fail to specify how
the shares are to be voted, will be voted FOR of the proposal.
The proxy may be revoked at any time prior to the voting thereof by
executing a superseding proxy, by giving written notice to the secretary of the
Trust at the address listed on the front cover of this Proxy
Statement/Prospectus or by voting in person at the Meeting.
In the event there are not sufficient votes to approve the proposal at the
time of the Meeting, the Meeting may be adjourned in order to permit further
solicitations of proxies by GOF. If GOF proposes to adjourn the Meeting by a
vote of the shareholders, the persons named in the enclosed proxy card will vote
all shares for which they have voting authority in favor of such adjournment.
To the knowledge of GOF as of record date, no shareholder owned of record
or beneficially more than 5% or more of the outstanding shares of the Fund,
except __________________ which owned of record approximately ____%. To the
knowledge of GRF, as of record date, no shareholder owned of record or
beneficially more than 5% of the outstanding shares of the Fund, except
_____________________ which owned of record approximately ___%. In addition, as
of record date, the Trustees and officers of the Trust as a group owned ___% and
___% of the outstanding shares of GRF and GOF, respectively.
2
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Van Eck Associates Corporation (the "Adviser") has agreed to absorb all of
the expenses of GOF and GRF associated with effecting the transactions
contemplated by the Plan as well as the unamortized organizational costs
outstanding on the date of the consummation of the Reorganization. In addition
to the solicitation of proxies by mail, proxies may be solicited by officers of
the Funds and DST Systems, Inc., the Funds' Transfer Agent and Dividend Paying
Agent (the "Transfer Agent" or "DST"), personally or by telephone or telegraph.
Brokerage houses, banks and other fiduciaries will be requested to forward
soliciting material to the beneficial owners of the shares of the Fund and to
obtain authorization for the execution of proxies.
SYNOPSIS
The following is a synopsis of the information contained in or incorporated
by reference in this Proxy Statement/Prospectus regarding the Reorganization,
and presents key considerations for shareholders of GOF to assist them in
determining whether to approve the Reorganization.
The Reorganization
Sales of GOF shares are lower than had been expected and sufficient
improvement in the sale of GOF shares is not anticipated by the Fund's
distributor. The Trustees of the Trust, of which GOF is a series, have
determined that the Reorganization (as described herein) is in the best
interests of the shareholders of GOF and have given their approval to the
transactions contemplated in the Plan associated with the Reorganization. The
result of the Reorganization, if it is consummated, will be the exchange of
assets from GOF for Reorganization Shares, the assumption of the liabilities of
GOF by GRF, the distribution of such Reorganization Shares to the shareholders
of GOF and the subsequent liquidation of GOF. For more information see "The
Reorganization" below.
Investment Objectives and Policies
GRF is a diversified series of the Trust which is an open-end management
investment company organized as a Massachusetts business trust. The Adviser
acts as the investment adviser to GRF. GRF seeks long-term capital
appreciation. GRF attempts to achieve its investment objective by investing its
assets in equity and debt securities of companies engaged in the exploration,
development, production and distribution of gold and other natural resources
such as strategic and other metals, minerals, oil, natural gas and coal, and by
investing in gold bullion and coins. The Fund may also invest in equity and
debt securities of companies which themselves invest in companies engaged in
these activities. Although current income may be realized, it is not an
investment objective. It is anticipated that the Fund will realize only a
nominal amount of current income. Normally, the Fund will have at least 65% of
its total assets invested in some combination of securities of companies engaged
in gold mining and natural resources activities. GRF may invest up to 35% of
the value of its total assets in: (a) common stock of companies not in the gold
mining/natural resources areas; (b) high grade corporation debt securities; and
(c) obligations issued or guaranteed by U.S. or foreign governments and
repurchase agreements.
The five largest gold producing countries are South Africa, the United
States, Australia, CIS (the former U.S.S.R.) and Canada. During normal market
conditions, the Fund expects to invest at lest 25% of its assets in securities
of companies in Canada and the United States which are engaged in gold mining.
The Fund will not invest in securities of South African issuers. This is a
fundamental policy of the Fund which may be changed only with shareholder
approval.
During periods of less favorable economic and/or conditions, the Fund may
make substantial investments for temporary defensive purposes in obligations of
the U.S. Government, certificates of deposit, bankers' acceptances, high grade
commercial paper and repurchase agreements.
3
<PAGE>
GRF has reserved the right to invest up to 10% of its net assets, taken at
market value at the time of investment, in gold bullion and coins. Since coins
and bullion do not generate any investment income, the sole source of return to
the Fund from such investments would be from gains realized on sales of the
coins or bullion, and a negative return would be realized to the extent they are
sold at a loss. The Fund incurs custody costs in storing gold bullion and
coins.
The Fund has no restrictions on the amount of its assets that may be
invested in securities of foreign issuers and thus the relative amount of such
investments will change from time to time. Investments by the Fund in
securities of foreign issuers may involve particular investment risks.
GOF is a non-diversified series of the Trust. The Adviser also acts as
investment adviser to GOF. This Fund seeks long-term capital appreciation by
investing in equity and debt securities of companies engaged in the exploration,
development, production and distribution of gold and other precious metals and
in other investments whose value is related to the value of precious metals.
Under normal market conditions, the Fund will invest at least 65% of its total
assets in the securities of such companies. GOF may also invest in options,
futures and forward contracts on precious metals and precious metals securities;
indexed securities and structured notes on precious metals and precious metals
indices; and precious metals bullion and coins.
In pursuing an aggressive strategy, the Fund may invest a significant
portion of its assets in the securities of smaller companies engaged in the
precious metals industry ("Emerging and Marginal Producers") and anticipates
that its portfolio turnover will be high than other funds with similar
investment objectives. In addition, when the Adviser anticipates that the
price of the securities of issuers in the precious metals industry may suffer a
significant market decline, the Fund may hold cash or invest in high quality
money market instruments for defensive purposes. While the Fund expects to do
so only temporarily, conditions may arise that cause the Fund to be invested in
money market instruments for extended periods and when, in the Adviser's
opinion, a defensive position in the market is appropriate, the Fund may invest
without limitation, up to 100% of its total assets in cash or high quality money
market instruments. The Fund may also invest in South Africa and in the
securities of issuers located in countries with developing markets and
economies. In addition, the Fund may borrow up to 30% of its assets for
leveraging purposes.
Reasons for the Transaction
Sales of GOF have, overall, fallen short of the expectations of Van Eck
Securities Corporation (the "Distributor"). Net assets of GOF as of April 30,
1997 were $8,209,983. This failure of GOF to reach the net asset level
anticipated by the Distributor has meant that the Fund's expense ratio has been
higher than anticipated. Since commencement of operations, the Adviser has been
voluntarily absorbing operating expenses of GOF. The Adviser cannot reasonably
be expected to subsidize the operations of the Fund indefinitely and without
continued subsidization of GOF by the Adviser, the Fund's expense ratio would
exceed that of many other funds with similar investment objectives. This would
have an adverse impact on the Fund's performance. As a result, the GOF's
current asset base could decline and the Fund's expense ratio would rise as
certain fixed costs would be spread over a shrinking asset base. Expenses
assumed by the Adviser are estimated to be $61,883 for the six months ended June
30, 1997. In addition, the low level of assets in the Fund have made it
difficult for the Adviser to effectively pursue the Fund's investment
objectives.
GRF, on the other hand, has achieved a substantial asset base since its
inception with net assets of approximately $105 million as of April 30, 1997.
Although the assets of GRF have fluctuated from time to time, assets under
management have been sufficiently stable for the Adviser to pursue the
investment objectives of the Fund. The Distributor anticipates that assets of
GRF, whether the Reorganization is approved or not, will remain relatively
constant or will increase. After the Reorganization, shareholders of GOF will
be subject to GRF's lower total expense ratio. As described more fully below,
GRF pays a lower fee pursuant to Rule 12b-1 under the
4
<PAGE>
Investment Company Act of 1940, as amended (the "1940 Act"). Currently, the
aggregate of advisory and administrative fees paid by GRF is higher than those
paid by GOF because the Adviser has waived certain of GOF's administration fees
during its first two years of operation. However, certain fixed share expenses
(such as accounting, transfer agent, legal, etc.) will be lower for GRF than
such expenses would be for GOF in the absence of the Adviser's current practice
of assuming all of GOF's expenses. Thus, assuming the Adviser discontinues its
current practice of absorbing all of GOF's expenses, GOF shareholders will
experience lower 12b-1 fees, administrative fees, and in the per share fixed
costs by holding GRF shares than they would if they continued to hold shares in
GOF.
Although GOF and GRF differ in some respects, they have certain
similarities in their investment objectives and portfolios. As more fully
described in "Investment Objectives and Policies" above and "Special
Considerations and Risk Factors," both GRF and GOF seek long-term capital
appreciation by investing globally in a mix of equity securities of companies
engaged in the exploration, development, production and distribution of gold and
other precious metals. GRF, however, invests in debt securities of such
companies and also invests in a wider variety of companies involved in the
exploration, development, production and development of natural resources than
GOF does.
The Board of Trustees considered a number of factors and alternatives. In
particular, the Trustees considered that the Adviser could not be expected to
subsidize the operations of GOF indefinitely and that, upon the termination of
the Adviser's commitment to absorb the expenses of GOF, expenses paid by GOF
shareholders could be expected to increase dramatically. The Trustees
determined that the Reorganization, as described herein, provided greater
benefits to shareholders than other options, such as the liquidation of GOF.
Liquidating GOF would have required most shareholders to recognize either gains
or losses in the current tax year when many shareholders might have preferred to
defer such gains or losses. In addition, the exchange privilege allows all
shareholders of GOF to exchange into another fund within the Van Eck group of
funds without imposition of any exchange fees or sales charges or to redeem
their shares without imposition of a sales charge. An exchange into GRF forces
the shareholder to recognize a gain or loss for tax purposes, whereas the merger
will achieve the same result as an exchange, but on a tax-free basis. The
redemption procedure and exchange privilege allow any shareholder not desiring
to participate in the Reorganization to achieve the same results as liquidation
of GOF. The Board also considered the compatibility of the Funds' investment
objectives, policies, restrictions and portfolios; any factors which might
require an adjustment to the exchange price or formula, such as costs or tax and
other benefits to be derived by the Funds; tax consequences of the
reorganization; relative benefits to be derived by the Adviser and/or its
affiliates or other persons; and other factors.
Investment Advisory Fees
The Adviser acts as the investment adviser for GRF and GOF. The Adviser
acts as investment adviser or sub-investment adviser to other mutual funds
registered with the Securities and Exchange Commission under the 1940 Act and
manages or advises managers of portfolios of pension plans and others. Total
aggregate assets under management of the Adviser on April 30, 1997 were
approximately $1.6 billion. John C. van Eck, Chairman and President of Van Eck
Funds and Van Eck Worldwide Insurance Trust, and members of his immediate family
own 100% of the voting stock of the Adviser.
5
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GRF and GOF pay investment advisory fees (the "Advisory Fee") to the
Adviser according to the following schedule/1/:
<TABLE>
<CAPTION>
Net Assets GRF GOF/2/
- -------------------------------------------------
<S> <C> <C>
0-$500 million............. .75% 1.00%
$500-$750 million.......... .65% 1.00%
In excess of $750 million.. .50% 1.00%
- ----------------
</TABLE>
(1)The Advisory Fee is payable monthly computed on the average daily net assets.
(2)The Advisory Fee listed for GOF includes an investment advisory fee and an
administrative fee which includes certain accounting and legal expenses. GRF
pays an annual administration fee, which is assessed separately (based upon the
average daily net assets of GRF) and is payable monthly.
Other Fees
GRF adopted a Plan of Distribution pursuant to Rule 12b-1 of the 1940
Act for its Class A shares. Under this Plan, GRF pays a fee to the Distributor
accrued daily at an annual rate of 0.25% of the average daily net assets. GRF's
12b-1 Plan is a "reimbursement plan". Under GRF's 12b-1 Plan, the fees, or a
percentage thereof, paid by GRF under the Plan are used for payments to agents
or brokers who service shareholder accounts of GRF and the remainder is used for
other actual promotional and distribution expenses incurred by the Distributor.
The 12b-1 Plan fee accrued by GRF in excess of payments to Brokers and Agents
and reimbursement to the Distributor for its actual expenses will be retained by
GRF. A reimbursement by the plan does not provide for the payment of interest
as a distribution expense. The Plan of Distribution in effect for GRF is
described in more detail in the Prospectus under "Plan of Distribution."
GOF also adopted a 12b-1 Plan relating to each of its Class A, B and C
shares. GOF's 12b-1 Plan is a "Compensation Plan". Under a compensation type
plan the fees paid by GRF under the Plan are not directly tried to expenses and
payments by a fund and may be more or less than the actual expenses incurred
under the Plan. The Plan also has a "carry-forward provision" which provides
that the Distributor, in the event that any reimbursable or payable amount
attributable to a fiscal year in excess of GOF's annual limitations (.__% of
average daily net assets) for that fiscal year (a "Carry-Forward Amount"), such
expenses may be paid in a subsequent fiscal year including after the termination
of the Plan, subject to the annual limitation. The Distributor has agreed to
waive its right to any Carry-Forward Amounts still remaining as of the date of
the Reorganization.
GOF's Class A shares are subject to a 12b-1 fee accrued daily at an
annual rate of .50% of average daily net assets.
GOF's Class B shares pay dealers, through the Distributor (i) a
service fee and a distribution fee, at the time their shares are sold, not to
exceed .25% and .75%, respectively, of the net asset value of such shares
(excluding shares issued for reinvested dividends and distributions) and (ii)
after the first anniversary of the sale of shares, fees for services and
distribution at annual rates not to exceed an annual rate of .25% and .75%,
respectively, of the average daily net assets (including shares issued for
reinvested dividends and distributions). The Distributor may retain from the
12b-1 fee, for the payment of distribution expenses, such amount not to exceed
as annual rate of .25% of the average daily net assets.
6
<PAGE>
Through the period ending November 1, 1996, GOF suspended payment
under the 12b-1 Plan for its Class C shares. Under the 12b-1 Plan for Class C
shares, sales of Class C shares since November 1, 1996 will be subject to 12b-1
fees that are equal to those paid by purchasers of Class B shares.
GRF also pays the Adviser a fee for administrative and accounting
services (the "Administrative Fee") at an annual rate of .25% of daily net
assets. GRF's total operating expenses, as of December 31, 1996 was 1.71% of
average daily net assets. GOF's total operating expenses, as of December 31,
1996, was 1.16% (absent the assumption of expenses by the Adviser they would
have been 3.32%) and are currently running at a rate of 2.00% (absent the
assumption of expenses by the Adviser they would have been 3.32%) of average
daily net assets. The following chart provides a comparison of the transaction
and operating expenses paid by GRF and GOF.
GRF-A
POST
SHAREHOLDER TRANSFER EXPENSES*.. GRF-A GOF-A GOF-B GOF-C MERGER
---- ----- ----- ----- ------
Maximum Sales Load Imposed
on Purchases 5.75% 5.75% 0% 0% 5.75%
Contingent Deferred Sales
or Redemption Fees 0% 0% 5.0% 1.0% 0%
ANNUAL FUND OPERATING EXPENSES GRF-A GOF-A GOF-B GOF-C MERGER
----- ----- ----- ----- ------
Management Fee .75% 1.00% 1.00% 1.00% .75%
12b-1 Fees/Shareholder
Servicing Fee .25% .50% 1.00% 1.00% .25%
Administration Fee .25% 0% 0% 0% .25%
Other Expenses
Transfer and Dividend
Disbursing Fees .24% .44% 4.20% 3.49% .24%
Custodian Fees .02% .16% .14% .15% .02%
Other Expenses .20% .97% .10% .17% .20%
---- ---- ---- ---- ----
Total Fund Expenses 1.71% 3.07% 7.04% 5.81% 1.71%
*Annualized
EXAMPLE:You would bear the following expenses on a $1,000 investment assuming a
(1) 5% annual return and (2) redemption at the end of each time period.
GRF-A
POST
GRF-A GOF-A GOF-B GOF-C MERGER
------- ------- ------- ------- -------
1 Year $ 73.71 $ 86.71 $119.68 $ 67.86 $ 73.71
3 Years $107.74 $146.84 $234.81 $172.19 $107.74
5 Years $144.05 $209.32 $344.48 $284.67 $144.05
10 Years $245.81 $376.36 $636.21 $558.00 $245.81
This table should not be considered a representation of future expenses
which may be more or less than those shown. The assumed 5% annual return is
hypothetical and should not be considered a representation of past or future
annual return. Actual return may be greater or less than the assumed amount.
The purpose of the foregoing table is to assist investors in understanding
the various costs and expenses that an investor will be directly or indirectly.
7
<PAGE>
Exchange Rights
Class A shares of GOF and GRF may be exchanged for Class A shares in the
following funds, which are also advised by the Adviser, at the current net asset
value: GRF (Class A), U.S. Government Money Fund, Global Income Fund (Class A),
International Investors Gold Fund (Class A), Asia Dynasty Fund (Class A),
Gold/Resources Fund (Class A), Global SmallCap Fund (Class A), GOF (Class A),
Emerging Market Growth Fund (Class A) and Global Hard Assets Fund (Class A).
Class B shares of GOF may be exchanged for Class B shares with the following
funds, which are also advised by the Adviser, at current net asset value: Asia
Dynasty Fund (Class B), Gold/Resources Fund (Class B), Emerging Market Growth
Fund (Class B) and Global Hard Assets Fund (Class B). Class C shares of GOF may
be exchanged for Class C shares of the Global Hard Assets Fund (Class C),
Emerging Market Growth Fund (Class C) and International Investors Gold Fund
(Class C) GOF Class B or C shares exchanged for Class B or C shares of another
fund with a different contingent deferred sales charge or redemption charge
schedule will be subject to the contingent deferred sales charge or redemption
charge applicable to those shares at the time of original purchase. Shareholders
of GRF and GOF are limited to six exchanges per calendar year. In addition, each
Fund reserves the right to terminate, modify or impose a fee in connection with
the exchange privilege as described in more detail in the Statement of
Additional Information under "Exchange Privilege. "
Conversion Feature
Class B and C shares include all shares purchased pursuant to the
contingent deferred sales charge or redemption charge alternative. Eight years
after the end of the month in which the shareholder's order to purchase was
accepted, Class B and C shares will automatically convert to Class A shares and
will no longer be subject to the higher distribution and services fee. Such
conversion will be on the basis of the relative net asset value of the two
classes, without the imposition of any sales load, fee or other charge. The
purpose of the conversion feature is to relieve the holder of the Class B and C
shares from most of the burden of distribution-related expenses for shares that
have been outstanding for a period of time sufficient for the Fund or its
Distributor to have been compensated for such expenses.
For the purposes of conversion to Class A shares, shares purchased through
the reinvestment of dividends and distributions paid in respect to Class B and C
shares in a shareholder's fund account will convert in proportionate amount to
he non-reinvestment shares converted.
The conversion of Class B and C shares to Class A shares is subject to the
continuing availability of an opinion of counsel to the effect that (i) the
assessment of the higher distribution services fee and transfer agency costs
with respect to Class B and C shares does not result in the Fund's dividends or
distributions constituting "preferential dividends" under the Code, and (ii) the
conversion of shares does not constitute a taxable event under federal income
tax law. The conversion of Class B and C shares to Class A shares may be
suspended if such an opinion is not longer available. In that event, no further
conversions of Class B and C shares would occur, and shares might continue to be
subject to the higher distribution services fee for an indefinite period which
may extended beyond the period ending eight years after the end of the month in
which the shareholder's order to purchase was accepted.
Redemption Procedures
Shares of GRF and GOF may be redeemed at net asset value at any time.
Shares of either of the Funds may be redeemed by writing to DST, through the
shareholder's Broker or Agent (although the Broker or Agent may charge a fee for
its services) or, if the shareholder has so elected, by contacting DST by
telephone. See "Redemption of Shares" in the Prospectus for more information.
8
<PAGE>
Dividends And Distributions
GRF and GOF generally make distributions from net investment income in June
and December. Both Funds generally make distributions from net realized capital
gains resulting from investment activities annually in December. If the
Reorganization is approved by shareholders, GOF intends to declare any
applicable dividends and distributions prior to the Exchange Date.
Net Asset Value
The net asset value of GRF and GOF is determined at the close of business
of each day the New York Stock Exchange is open for trading. Both funds compute
net asset value by dividing the value of the fund's securities, plus cash and
other assets (including interest and dividends accrued but not yet received),
less all liabilities (including accrued expenses), by the number of shares
outstanding. Expenses, including fees paid to the Adviser, are accrued daily
for the funds.
Tax Consequences
Upon the closing of the Reorganization, counsel to GOF and GRF, Goodwin,
Procter & Hoar LLP will opine that, subject to the customary assumptions and
representations, on the basis of the existing provisions of the Internal Revenue
Code of 1986, as amended (the "Code"), the Treasury Regulations promulgated
thereunder and current administrative and judicial interpretations thereof, for
federal income tax purposes: (i) the transfer of all or substantially all of
the assets of GOF to GRF solely in exchange for GRF shares and the assumption by
GRF of some of GOF's liabilities and the distribution of such shares to the
shareholders of GOF, as provided in the Plan, will constitute a reorganization
within the meaning of Section 368(a)(1)(C) of the Code; GRF and GOF will each be
a "party to a reorganization" within the meaning of Section 368(b), (ii) GOF
will not recognize gain or loss on the transfer of its assets to GRF in the
Reorganization, (iii) GOF will not recognize gain or loss upon its distribution
to its shareholders of the GRF shares received in the Reorganization, (iv) GRF
will not recognize a gain or loss upon the receipt of the assets of GOF in
exchange for the GRF shares, (v) shareholders of GOF will not recognize a gain
or loss on the exchange of shares of GOF for shares of GRF provided that such
shareholders receive solely GRF shares (including fractional shares) in exchange
for their GOF shares, (vi) the tax basis of the GOF assets acquired by GRF will
be the same to GRF as the tax basis of such assets to GOF immediately prior to
the Reorganization and the holding period of the assets of GOF in the hands of
GRF will include the period during which those assets were held by GOF, (vii)
the aggregate tax basis of the GRF shares received by the shareholders of GOF
will be the same as the aggregate tax basis of GOF shares exchanged by such
shareholder immediately prior to the Reorganization, (viii) the holding period
of the GRF shares (including fractional shares) received by shareholders of GOF
will include the holding period that the GOF shares exchanged were held
(provided that the GOF shares exchanged were held as a capital asset on the date
of the reorganization). For a discussion of additional tax considerations, see
"Tax Consequences of the Reorganization" (below).
SPECIAL CONSIDERATIONS AND RISK FACTORS
Since both GRF and GOF invest extensively in equity securities of both
foreign and domestic issuers engaged in the exploration, development, production
of gold and other metals, any risks inherent in such investments are applicable
to both entities. GRF will, however, under normal market conditions also,
invest in debt securities of such issuers while GOF will not invest in debt
securities of this type. Thus GRF may be more exposed to the risks involved
with investing in debt securities. The market value of debt securities
generally varies in direct response to changes in interest rates and the
financial condition of the issuer. During periods of declining interest rates,
the value of debt securities generally increases. Conversely, during periods
9
<PAGE>
of rising interest rates, the value of such securities generally declines. Debt
securities with similar maturities may have different yields, depending upon
several factors, including the relative financial condition of the issuers. In
addition, GRF will also invest in equity and debt securities of companies
engaged in the exploration development, production and distribution of other
natural resources such as oil, natural gas and coal. To the extent that GRF
invests in these types of securities as opposed to those related to precious
metals, GRF is more diversified than GOF in its investment strategy.
GOF has engaged in a more aggressive investment strategy in seeking to
reach investment objectives that are similar to those of GRF. GOF has the
ability to invest a significant portion of its assets in smaller companies
involved in the precious metals industry. GRF does not currently, and has no
present intention, to invest its assets in such issuers. GOF also invests in
South Africa while GRF has a fundamental policy that prohibits it from investing
in South African issuers and that policy cannot be changed without shareholder
approval. Finally, GOF has the ability, for defensive purposes, to hold up to
100% of its assets in high quality money market instruments such as certificates
of deposit, commercial paper or obligations issued by the U.S. government or any
of its agencies or instrumentalities for an indefinite period. Although GRF may
make substantial investments in similar money market instruments, it may do so
only on a temporary basis. This limitation may lead to greater exposure for GRF
to the risks of investing in securities related to the gold and other natural
resource companies than would be the case with GOF.
Both GRF and GOF may invest directly in precious metal coins (including
gold, silver, platinum and palladium). The value of such coins generally moves
correspondingly with the price of bullion in that the value of these coins is
based on their precious metal content. Since such investments do not generate
any investment income, the sole source of return from such investments would be
from gains realized on sales of the coins or bullion, and a negative return
would be realized to the extent such coins or bullion are sold at a loss.
GRF and GOF both invest in securities issued by foreign issuers. As a
result, each Fund may from time to time hold foreign currencies and therefore,
the value of the assets of the Fund (and thus their net asset values) may be
affected by changes in currency exchange rates. To the extent such currencies
are held by a Fund, such Fund's performance will be less favorable if foreign
currency exchange rates move adversely relative to the U.S. dollar.
Investments in foreign securities may involve a greater degree of risk than
investments in domestic securities due to the possibility of exchange controls,
less publicly available information, and the possibility of expropriation,
confiscatory taxation or political, economic or social instability. In
addition, some foreign companies are not generally subject to the same uniform
accounting, auditing and financial reporting standards as are American
companies, and there may be less government supervision and regulation of
foreign stock exchanges, brokers and companies. Foreign securities may also be
subject to foreign taxes, higher custodian fees and dividend collection fees
which could reduce the yield on such securities. Foreign securities, unless
fully hedged, will be subjected to fluctuations in currency exchange rates.
While it is the policy of GRF generally not to engage in trading for short-
term gains, GOF will effect portfolio transactions without regard to the holding
period if, in the judgment of the Adviser, such transactions are advisable in
light of a change in circumstances of a particular company, within a particular
industry or country, or in general market, economic or political conditions.
This may lead to a higher portfolio turnover ratio. The annual portfolio
turnover rate for GOF for the fiscal year ended December 31, 1996 was 249.64%
while GRF's portfolio turnover rate for the same period was 12.95%. The
portfolio turnover rate of all funds may vary greatly from year to year.
10
<PAGE>
GRF is diversified while GOF is non-diversified. A diversified fund is
one which meets the following definition: At least 75% of the value of its total
assets is represented by cash and cash items (including receivables), government
securities, securities of other investment companies and other securities; for
purposes of this calculation limited in respect to any one issuer to an amount
not greater than 5% of the value of the fund's total assets and to not more than
10% of the voting securities of such issuer. A non-diversified fund is any other
fund. By virtue of being a non-diversified fund, GOF retains the ability to
focus its portfolio of investments in a smaller number of issuers. Such an
investment strategy would expose GOF to greater risk of loss in the event of a
price decline in one or more issuers in which it held substantial positions. As
of ________, 1997, GRF had not invested more than 5% of its assets in any one
issuer, but GRF may invest 5% or a greater percentage of its assets in certain
issuers in the future.
Both GRF and GOF may invest a substantial portion of their assets in the
securities of developing countries with emerging economies or securities
markets. Investments in the equity and fixed income markets of developing
countries involves exposure to potentially unstable governments, economies based
on only a few industries, and securities markets which trade a small number of
securities and may therefore at times be illiquid. Securities markets of
developing countries tend to be more volatile than the markets of developed
countries. See "Risk Factors" in the Prospectus for a more detailed discussion
of the risks involved with investments in developing countries.
For hedging purposes only, GOF may enter into currency swaps while GRF is
prohibited from making such investments. Currency swaps involve the exchange of
rights to make or receive payments in specified currencies. Currency swaps
usually involve the delivery of the entire principal value of one designated
currency in exchange for the other designated currency. Therefore, the entire
principal value of the currency swap is subject to the risk that the other party
to the swap will default on its delivery obligations. The use of currency swaps
is a highly specialized activity which involves investment techniques and risks
different from those associated with ordinary portfolio transactions. If the
Adviser is incorrect in its forecasts about market values and currency exchange
rates, the investment performance of the Fund would be less favorable than it
would have been if this investment technique were not used.
GOF may borrow up to 30% of the value of its net assets to increase
holdings of portfolio securities (i.e., engage in leveraging) while GRF can only
borrow up to 10% of its net assets for emergency purposes only and may not
purchase securities if it has outstanding borrowings equal to 5% or more of its
net assets. Leveraging by means of borrowing will exaggerate the effect of any
increase or decrease in the value of the portfolio securities on the Fund's net
asset values and money borrowed will be subject to interest and other costs
which may or may not exceed the income received from the securities purchased
with borrowed funds. In addition, GOF may lend to broker-dealers portfolio
securities with an aggregate market value of up to one-third of its total assets
while GRF may not make such loans. Such loans must be secured by collateral at
least equal to the market value of the securities loaned and the Fund will
continue to receive any interest or dividends paid on the loaned securities and
will retain voting rights with respect to the securities. The Fund might
experience the risk of loss if the broker-dealer involved in such a loan
breaches its agreement.
Investments in foreign securities may involve a greater degree of risk than
investments in domestic securities due to the possibility of exchange controls,
less publicly available information, and the possibility of expropriation,
confiscatory taxation or political, economic or social instability. In
addition, some foreign companies are not generally subject to the same uniform
accounting, auditing and financial reporting standards as are American
companies, and there may be less government supervision and regulation of
foreign stock exchanges, brokers and companies. Foreign securities may also be
subject to foreign taxes, higher custodian fees and dividend collection fees
which could reduce the yield on such securities. Foreign securities, unless
fully hedged, will be subjected to fluctuations in currency exchange rates.
11
<PAGE>
Both GRF and GOF, subject to certain restrictions, are allowed to utilize
portfolio strategies involving options, futures, and repurchase agreements which
may involve additional risks. See "Risk Factors" in both the Prospectus and the
Statement of Additional Information for a more detailed discussion of the risks
involved with these practices and strategies as well as the other practices and
strategies discussed in this section.
THE REORGANIZATION
Procedures
The Adviser is hereby soliciting shareholders of GOF to vote for the
approval of the Reorganization. It is anticipated that the Meeting will be held
on ___________, 1997 at 99 Park Avenue, 8th Floor, New York, New York at _____
a.m. If the Funds' shareholders approve the Reorganization, the Reorganization
will take place on or about _______ __, 1997.
Terms of The Agreement And Plan of Reorganization
The following is a summary of the significant terms of the Plan which has
been considered and approved by the Trustees of Van Eck Funds at meetings held
on April 22, 1997. A copy of the Plan is attached to this Proxy
Statement/Prospectus as Exhibit A. This summary is qualified in its entirety by
reference to the Plan.
VALUATION OF ASSETS AND LIABILITIES. The assets of GRF and GOF will be
valued on the business day prior to the date on which the Reorganization will
take place (the "Exchange Date"). The assets in each portfolio will be valued
according to the procedures set forth under "Determination of Net Asset Value"
in the Statement of Additional Information (a summary of that method appears
herein under "Synopsis--Net Asset Value"). Redemption requests for GOF which
have not been settled as of the Exchange Date will be treated as liabilities for
purposes of the Reorganization. Exchange requests for GOF shares received on
the Exchange Date will be treated and processed as exchanges from GRF and will
be effected as of the close of business on the Exchange Date.
DISTRIBUTION OF SHARES AND TRANSFER OF ASSETS. On the Exchange Date, GRF
will issue to GOF a number of Class A shares of beneficial interest, the
aggregate net asset value of which will equal the aggregate net asset value of
the assets transferred to GRF by GOF on the Exchange Date. Each shareholder of
GOF will receive a number of Class A shares of GRF having an aggregate net asset
value of his or her shares of GOF. No sales charge or fee of any kind will be
charged to the shareholders of GOF in connection with their receipt of Class A
shares of GRF in the Reorganization.
EXPENSES. The Adviser has agreed to absorb all of the expenses of GOF and
GRF associated with effecting the transactions contemplated by the Plan as well
as the unamortized organizational costs outstanding on the date of the
consummation of the Reorganization.
REQUIRED APPROVALS. Under the provisions of the Amended and Restated
Master Trust Agreement of the Trust, approval of the Plan requires that a
majority of GOF's outstanding voting shares must vote in favor of the Plan.
Such majority is defined under the Master Trust Agreement as the lesser of (i)
67% or more of the outstanding shares present at the meeting, provided the
holders of 50% or more of the outstanding shares are present in person or by
proxy, or (ii) more than 50% of the outstanding shares.
12
<PAGE>
AMENDMENTS AND CONDITIONS. The Plan may be amended at any time prior to
the Exchange Date with respect to any of the terms therein except that following
the meeting of the shareholders of GOF, no such amendment may have the effect of
changing the provisions of the Plan determining the number of GRF shares to be
issued to GOF shareholders to their detriment without their further approval.
The obligations of GRF and GOF are subject to various conditions, including a
registration statement on Form N-14 being declared effective by the Securities
and Exchange Commission, approval of the Reorganization by the shareholders of
GOF and the continuing accuracy of various representations and warranties of GRF
and GOF being confirmed by the respective parties.
Benefits to GOF as a Result of Reorganization
1. Certain fixed costs, such as costs of printing shareholder reports,
prospectuses, statements of additional information and proxy statements, legal
expenses, transfer agency fees, audit fees, registration fees, mailing costs and
other expenses will be spread across a larger asset base.
The asset level of GOF is much smaller than the Adviser had anticipated and
it has made it more difficult for the Adviser to achieve its investment
objective while maintaining low costs without absorbing a larger portion of
GOF's expenses than it had expected. This lower then expected asset level has
meant that some fixed costs, such as those listed above have been spread over a
smaller asset base. Although, GOF's expense ratio has dropped somewhat from an
annualized rate of 7.61% as of December 31, 1995, it remained at the relatively
high level of 3.32% as of December 31, 1996 and the expense ratio has not
decreased as of April 30, 1997. Since commencement of operations, the Adviser
has been voluntarily absorbing operating expenses of GOF. The Adviser cannot
reasonably be expected to subsidize the operations of the Fund indefinitely and
without continued subsidization of GOF by the Adviser, the Fund's expense ratio
would exceed that of many other funds with similar investment objectives. This
would have an adverse impact on the Fund's performance. As a result, the GOF's
current asset base could decline and the Fund's expense ratio would rise as
certain fixed costs would be spread over a shrinking asset base. Expenses
assumed by the Adviser are estimated to be $61,883 for the six months ended June
30, 1997. In addition, the low level of assets in the Fund have made it
difficult for the Adviser to effectively pursue the Fund's investment
objectives.
GRF, on the other hand, has achieved a substantial asset base since its
inception with net assets of approximately $105 million as of April 30, 1997.
The Distributor anticipates that net assets of GRF will remain relatively stable
compared to GOF, whether or not the Reorganization is approved. It is estimated
that after the Reorganization, assuming that substantially all of the net assets
of GOF are part of the Reorganization, the total expense ratio of GRF would be
___%. There can be no guarantee that GRF's net assets or expense ratio will
remain at current levels, or that such reduction in the expense ratio will be
available in the future.
2. The Reorganization allows shareholders of GOF to defer recognition of
gains or losses on their shares until they choose to recognize such gains and
losses.
As more fully explained in "The Reorganization--Tax Consequences" below, as
of the Exchange Date, GOF will obtain an opinion from counsel to the Trust to
the effect that the Reorganization has been structured to be consummated, for
Federal income tax purposes, on a tax-free basis. Thus, a shareholder of GOF
will be able to defer the recognition of any gains or losses on his or her
shares of GOF until shares of GRF received pursuant to the Reorganization are
exchanged or sold. If GOF were liquidated rather than reorganized, a
shareholder would have no choice but to recognize any gains or losses in the
current tax year.
13
<PAGE>
Tax Consequences of the Reorganization
The Reorganization has been structured with the intention that it will
qualify for Federal income tax purposes as a tax-free reorganization under
Section 368(a)(1)(C) of the Code. GRF and GOF have both elected to qualify as a
regulated investment company under the Code and GRF intends to continue to elect
to so qualify. Upon the closing of the Reorganization, counsel to GOF and GRF,
Goodwin, Procter & Hoar LLP will opine that, subject to the customary
assumptions and representations, on the basis of the existing provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), the Treasury Regulations
promulgated thereunder and current administrative and judicial interpretations
thereof, for federal income tax purposes: (i) the transfer of all or
substantially all of the assets of GOF to GRF solely in exchange for GRF shares
and the assumption by GRF of some of GOF's liabilities and the distribution of
such shares to the shareholders of GOF, as provided in the Plan, will constitute
a "reorganization" within the meaning of Section 368(a)(1)(C) of the Code; GRF
and GOF will each be a "party to a reorganization" within the meaning of Section
368(b), (ii) GOF will not recognize gain or loss on the transfer of its assets
to GRF in the Reorganization, (iii) GOF will not recognize gain or loss upon its
distribution to its shareholders of the GRF shares received in the
Reorganization, (iv) GRF will not recognize a gain or loss upon the receipt of
the assets of GOF in exchange for the GRF shares, (v) shareholders of GOF will
not recognize a gain or loss on the exchange of shares of GOF for shares of GRF
provided that such shareholders receive solely GRF shares (including fractional
shares) in exchange for their GOF shares, (vi) the tax basis of the GOF assets
acquired by GRF will be the same to GRF as the tax basis of such assets to GOF
immediately prior to the Reorganization and the holding period of the assets of
GOF in the hands of GRF will include the period during which those assets were
held by GOF, (vii) the aggregate tax basis of the GRF shares received by the
shareholders of GOF will be the same as the aggregate tax basis of GOF shares
exchanged by such shareholder immediately prior to the Reorganization, (viii)
the holding period of the GRF shares (including fractional shares) received by
shareholders of GOF will include the holding period that the GOF shares
exchanged were held (provided that the GOF shares exchanged were held as a
capital asset on the date of the reorganization). The receipt of such opinions
upon the closing of the transaction is a condition to the consummation of the
Reorganization. If the transfer of assets of GOF in exchange for GRF shares and
the assumption by GRF of the liabilities of GOF do not constitute a tax-free
reorganization, each GOF shareholder will recognize gain or loss equal to the
difference between the value of the GRF shares such shareholder acquires and the
tax basis of such shareholder's GOF shares.
Shareholders should consult their tax advisers regarding the effect, if any
of the Reorganization in light of their individual circumstances. Since the
foregoing relates only to Federal income tax consequences, shareholders should
also consult with their tax advisers as to the state and local tax consequences,
if any, of the Reorganization.
14
<PAGE>
Capitalization
The following table sets forth, as of December 31, 1996, the capitalization
of GRF (Class A shares) and the capitalization of GOF (Class A, B and C shares).
CAPITALIZATION
--------------
Pro Forma
Reorganization
--------------
GRF GOF GRF
------------ ---------- ------------
Total Net Assets
Class A $132,298,375 $8,446,079 $142,483,174
Class B $ 498,020
Class C $1,240,700
Shares Outstanding
Class A $ 23,115,766 835,263 24,896,326
Class B 49,305
Class C 122,544
Net Asset Value Per Share
Class A $ 5.72 $ 10.11 $ 5.72
Class B $ 10.10
Class C $ 10.12
15
<PAGE>
GOLD/RESOURCES FUND AND GLOBAL OPPORTUNITY FUND
Financial Highlights
The Financial Highlights below give selected information for a share of GRF
and GOF outstanding for the year or period indicated. The Financial Highlights
for the periods ending December 31, 1996 and 1995 have been audited by Coopers &
Lybrand L.L.P., independent accountants, whose reports thereon appear in GRF's
and GOF's Annual Reports, which are incorporated by reference into the Statement
of Additional Information. This information should be read in conjunction with
the financial statements and related notes that also appear in GRF's Annual and
Semi-Annual Reports.
GOLD/RESOURCES FUND (CLASS A)
<TABLE>
<CAPTION>
For the Year For the Year
Ended Ended
December 31, 1996 December 31, 1995
------------------ ------------------
<S> <C> <C>
Net Asset Value, Beginning of Period $ 5.58 $ 5.35
Income from Investment Operations:
Net Investment Income (0.06) (0.03)
Net Gain/(Loss) on Securities
(both realized and unrealized) 0.20 0.26
-------- --------
Total from Investment Operations 0.14 0.23
Less Distributions:
Dividends from Net Investment Income - -
Net Asset Value, End of Period $ 5.72 $ 5.58
-------- --------
Total Return 2.51% 4.3%
-------- --------
<CAPTION>
For the Year For the Year
Ended Ended
December 31, 1996 December 31, 1995
------------------ ------------------
<S> <C> <C>
Ratios/Supplementary Data
Net assets, End of Period (000) $132,298 $155,974
-------- --------
Ratio of Expenses to Average
Net Assets 1.71% 1.81%
-------- --------
Ratio of Net Investment Income/(Loss) to
Average Net Assets (0.75)% (0.44)%
-------- --------
Portfolio Turnover Rate 12.95% 6.16%
-------- --------
Average Commissions Paid $ 0.0186
--------
</TABLE>
16
<PAGE>
GOLD OPPORTUNITY FUND
<TABLE>
<CAPTION>
For the Year For the Period
Ended January 5, 1995 to
December 31, 1996* December 31, 1995
------------------ -------------------
Class Class
A B C A B C
----------------------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 9.67 $ 11.99 $ 9.67 $ 9.43 N/A $ 9.43
Income from Investment Operations:
Net Investment Loss 0.02 - - 0.06 - 0.07
Net Gain on Securities
(both realized and unrealized) 0.49 (1.80) 0.51 0.35 - 0.34
Total from Investment Operations 0.51 (1.80) 0.51 0.41 - 0.41
Less Distributions:
Distributions from Investment Income (0.02) (0.04) (0.01) (0.17) - (0.17)
Capital Gains (0.05) (0.05) (0.05) - - -
Net Asset Value, End of Period $10.11 $10.10 $10.12 $ 9.67 - $9.67
Total Return 5.27% (15.01)% 5.27% (4.35)% - 4.35%
<CAPTION>
For the Year For the Period
Ended January 5, 1995 to
December 31, 1996* December 31, 1995
------------------ -------------------
Class Class
A B C A B C
----------------------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
Ratios/Supplementary Data
Net assets, End of Period (000) $8,446 $ 498 $ 1,241 $ 1,906 N/A $ 105
Ratio of Expenses to Average
Net Assets 1.14% 1.68% 1.25% 0% 0%
Ratio of Net Investment Income/
(Loss) to Average Net Assets 0.16% (0.35)% .07% 0.63% 0.68%
Portfolio Turnover Rate 249.64% 249.64% 249.64% 184.76% 184.76%
Expense Ratios Absent Assumption of
Certain Expenses by Adviser 3.07% 7.04% 5.81% 6.73% - 24.34%
</TABLE>
* Financial information regarding Class B shares is for the period from
April 24, 1996 to December 31, 1996.
17
<PAGE>
Management
TRUSTEES. The management of the business and affairs of GRF and GOF is the
responsibility of the Board of Trustees. The Trustees of Van Eck Funds (of
which GRF and GOF are series), consist of nine persons, five of whom are not
"interested persons" as defined in the 1940 Act.
INVESTMENT ADVISER AND ADMINISTRATOR. Van Eck Associates Corporation, 99
Park Avenue, New York, New York 10016, the Adviser, serves as the investment
adviser and manager for the Funds pursuant to Advisory Agreements with the
Trust. The Adviser manages the business and affairs of GRF pursuant to the
Investment Advisory Agreement and Accounting and Administrative Services
Agreement. GRF pays the Adviser fees at the rate indicated under "Synopsis--
Investment Advisory Fees" herein. The Advisory fees paid to the Adviser with
respect to GRF are higher than the fees paid by most investment companies
because of the complexities of managing this type of fund [(such as following
interest rates, currency exchange rates, industries and companies in many
different countries and financial markets throughout the world). For a more
complete description of the Adviser and its agreements with GRF see "Management"
in the Prospectus and "Investment Advisory Services" in the Statement of
Additional Information.
Under the Investment Advisory Agreement with GOF, the Adviser provides GOF
with a continuous investment program which includes determining which securities
should be bought, sold or held. For additional information see "Management" in
the Prospectus and "Investment Advisory Services" in the Statement of Additional
Information.
PORTFOLIO MANAGER. Lucille Palermo serves as President and Portfolio
Manager for both GRF and GOF. Ms. Palermo is the Associate Director, Mining
Research for the Adviser and an officer of other mutual funds advised by the
Adviser. Ms. Palermo has over 20 years of experience in the investment
business. Ms. Palermo has been employed by the Adviser since 1989 in various
capacities. Prior to her employment with the Advisor, she was an Investment
Strategist and Analyst with Drexel Burnham Lambert from 1979 through 1989.
TRANSFER AGENT. The Transfer Agent and Dividend Paying Agent for the funds
is DST Systems, Inc., P.O. Box 418407, Kansas City, Missouri 64141.
Shares of GRF to Be Issued in The Reorganization And Shares of GOF
SHARES. On the Exchange Date, all shareholders of GOF will be given a
number of Class A shares of beneficial interest, par value $.001 of GRF having
an aggregate net asset value equal to the net asset value of his or her shares
of GOF. The shares of GRF to be issued in the Reorganization will be identical
in all respects to all Class A shares of GRF then outstanding.
VOTING RIGHTS. Shareholders of GRF and GOF are entitled to one vote for
each share and a fractional vote for each fractional share held in the election
of Trustees (to the extent hereafter provided) and on other matters submitted to
a vote of shareholders. With respect to the 12b-1 Plans in effect for GRF,
Class A shareholders are only entitled to vote on matters affecting their
particular plan. Under the Amended and Restated Master Trust Agreement, no
annual or regular meeting of shareholders is required. Thus, there will
ordinarily be no shareholder meeting unless required by the 1940 Act. The Board
of Trustees is a self-perpetuating body until fewer than 50% of the Trustees
serving as such are Trustees who were elected by the shareholders. Under the
Amended and Restated Master Trust Agreement, any Trustee may be removed by a
vote of two-thirds of the outstanding Trust shares (outstanding Trust shares
include shares of all series of the Trust and not solely shares of GRF or GOF);
and holders of ten percent or more of the outstanding shares of the Trust can
require Trustees to call a meeting of shareholders for purposes of voting on the
removal of one or more Trustees. With respect to each of GOF and GRF, each
issued and outstanding share is entitled to participate equally in dividends and
distributions declared by such fund and, upon liquidation or dissolution, in the
net assets of such fund remaining after satisfaction of outstanding liabilities.
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SHAREHOLDER LIABILITY. Under Massachusetts law, the Shareholders of the
Trust could, under certain circumstances, be held personally liable for the
obligations of the Trust. However, the Amended and Restated Master Trust
Agreement of the Trust disclaims shareholder liability for acts or obligations
of the Trust and require that notice of such disclaimer be given in each
agreement, obligation or instrument entered into or executed by the Trust or the
Trustees. The Amended and Restated Master Trust Agreement provides for
indemnification out of the Trust's property for all losses and expenses of any
shareholder held personally liable for the obligations of the Trust. Thus, the
risk of a shareholder incurring financial loss on account of shareholder
liability is limited to circumstances in which the Trust itself would be unable
to meet its respective obligations. The Adviser believes that, in view of the
above, the risk of personal liability to shareholders is remote. The liability
provisions are identical for shareholders of GRF and GOF.
CONTROL. There are no persons who exercise control over GRF as "control"
is defined in the 1940 Act except _____________. There are no persons who
exercise control over GOF except _____________.
OTHER CLASSES. GRF does not have any other classes of securities
outstanding as defined in the 1940 Act other than the Class A shares described
herein. GOF has three classes of shares outstanding which are designated Class
A, Class B and Class C shares. The three classes are identical in all respects
except that: (1) (i) the Class A shares will be subject to a front-end sales
charge, (ii) the Class B shares will be subject to a Contingent Deferred Sales
Charge, and (iii) Class C shares are subject to a Contingent Deferred Redemption
Charge, (2) each class has adopted its own Rule 12b-1 Plan, (3) the three
classes will vote separately on their respective 12b-1 Plans and (4) any higher
incremental transfer agency costs and any other costs attributable solely to
Class A, Class B or Class C shares will be borne exclusively by such class. GOF
has no other classes of securities outstanding as defined in the 1940 Act.
CONTINGENT DEFERRED SALES OR REDEMPTION CHARGES. GOF Class B Shares are
sold subject to a contingent deferred sales charge of up to 5.0% and such
charge, if any, is to be imposed at the time of redemption of such shares. GOF
Class C Shares are sold subject to a contingent deferred redemption charge of
1.0% and such charge is to be imposed at the time of redemption of such shares.
The Distributor has agreed that it will not impose such sales charges as a
result of the Reorganization.
SHAREHOLDER INQUIRIES. Shareholder inquiries with respect to GRF or GOF
should be addressed to the Funds by telephone at (800) 544-4653 or in writing at
the address set forth on the cover page of the Proxy Statement/Prospectus.
DIVIDENDS AND DISTRIBUTIONS. GRF and GOF intend to make distributions from
net investment income in June and December. Both funds intend to make
distributions from net realized capital gains resulting from investment
activities annually in December. Dividends and capital gains may be received by
the shareholder in cash or may be reinvested in GRF or GOF at the net asset
value (without imposition of a sales charge) on the day so determined by the
Board of Trustees. In addition, dividends and capital gains (except those paid
by Class B and Class C shares) may also be reinvested in Class A shares of any
other series of Van Eck Funds.
TAX CONSEQUENCES. For a discussion of the tax consequences associated with
an investment in GRF or GOF, see "Taxes" in the Trust's Statement of Additional
Information. Shareholders are urged to consult their tax advisers regarding
specific questions as to Federal, foreign, state and local taxes.
Purchase of Shares
Both prior to, and subsequent to the Reorganization, shares of GRF will be
offered continuously for sale by the Distributor or by Brokers and Agents which
have entered into selling group or selling agency agreements with Van Eck
Securities Corporation, 99 Park Avenue, New York, New York 10016 (the
"Distributor"). The Reorganization will have no effect on the purchase
procedures for shares of GRF. GOF
19
<PAGE>
discontinued sales of its shares to new shareholders as of April 30, 1997. See
"Purchase of Shares" in the Prospectus. For more information on the Distributor,
see "The Distributor" in the Statement of Additional Information.
Each Class of shares of GRF and GOF has adopted a 12b-1 Plan in accordance
with the 1940 Act. The 12b-1 Plans are described in "Other Fees" herein. Each
12b-1 Plan must be approved annually by the Board of Trustees. For more
discussion of the 12b-1 Plans, see "Plan of Distribution" in the Prospectus.
Redemption Procedures
Redemption procedures for Class A shares of GRF are identical to the
redemption procedures currently in effect for GOF. Shares of the funds will be
redeemed at the net asset value on the day on which proper instructions are
received by DST. See "Redemption of Shares" in the Prospectus.
Other Matters
It is not anticipated that any matters other than the adoption of the Plan
described above will be brought before the Meeting. If, however, any other
business is properly brought before the Meetings, proxies will be voted in
accordance with the judgment of the persons designated on such proxies.
INFORMATION CONCERNING THE MEETING
Date, Time And Place of Meeting
The Meeting for shareholders of GOF will be held on _______________, 1997
at 99 Park Avenue, 8th Floor, New York, New York at _____ a.m.
Solicitation, Revocation And Use of Proxies
A shareholder executing and returning a proxy has the power to revoke it at
any time prior to its exercise by executing a superseding proxy or by submitting
a notice of revocation to the Secretary of the Fund at 99 Park Avenue, 8th
Floor, New York, New York 10016. Although mere attendance at the Meeting will
not revoke a proxy, a shareholder present at the Meeting may withdraw his or her
proxy and vote in person.
All shares represented by properly executed proxies, unless such proxies
have previously been revoked, will be voted at the Meeting in accordance with
the directions on the proxies; if no direction is indicated, the shares will be
voted "FOR" the approval of the Plan and the other proposals.
Record Date And Outstanding Shares
Only holders of record of each Fund's shares of beneficial interest, par
value $.001 per share, at the close of business on ___________, 1997 (the
"Record Date") are entitled to vote at the Meeting and any adjournment thereof.
At the close of business on the Record Date, there were approximately _________
shares of GOF outstanding and entitled to vote.
Security Ownership of Certain Beneficial Owners And Management
No person or entity owns beneficially 5% or more of GOF's shares except
___________________.
20
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No person or entity owns beneficially more than 5% or more of GRF's shares
except __________________.
Voting Rights And Required Vote
Voting procedures are described under "The Reorganization--Terms of the
Agreement and Plan of Reorganization".
A proxy that is properly executed and returned accompanied by instructions
to withhold authority to vote with respect to the reorganization represents a
broker "non-vote" (that is, a proxy from a broker or nominee indicating that
such person has not received instructions from the beneficial owner or other
person entitled to vote shares on the particular matter with respect to which
the broker or nominee does not have the discretionary power), and the shares
represented thereby will be considered not to be present at the Meeting for
purposes of determining the existence of a quorum for the transaction of
business for that proposal and be deemed not cast with respect to such proposal.
Also, a properly executed and returned proxy marked with an abstention will be
considered present at the Meeting for purposes of determining the existence of a
quorum for the transaction of business. However, abstentions and broker "non-
votes" do not constitute a vote "for" or "against" the matter, and, therefore
have the effect of a negative vote on matters which require approval by a
requisite percentage of the outstanding shares.
In the event a quorum is not present at the Meeting or in the event that a
quorum is present but sufficient votes to approve the reorganization are not
received, the persons named as proxies may propose one or more adjournments of
such Meeting to permit further solicitation of proxies. Any such adjournment
will require the affirmative vote of a majority of those shares voted at the
Meeting in person or by proxy. The persons named as proxies will vote those
proxies that they are entitled to vote in such manner as they determine to be in
the best interest of shareholders with respect to any proposal to adjourn the
Meeting. A shareholder vote may be taken on the reorganization prior to such
adjournment if sufficient votes have been received for approval.
Under Massachusetts law, shareholders of a registered investment company
are not entitled to demand fair value of the shares and will be bound by the
terms of the Reorganization if the Plan is approved at the Meeting. Any
shareholder in GOF may, however, either redeem his or her shares at net asset
value or exchange his or her shares into another Van Eck fund (without
imposition of any sales or redemption charge) prior to the date of the
Reorganization.
ADDITIONAL INFORMATION
This Proxy Statement/Prospectus and the related Statement of Additional
Information do not include all the information set forth in the registration
statements and exhibits relating thereto which GRF and GOF, respectively, have
filed with the Securities and Exchange Commission, Washington, DC 20549, under
the Securities Act of 1933 and the Investment Company Act of 1940, to which
reference is hereby made.
Reports, proxy statements, registration statements and other information
filed by GRF and GOF can be inspected and copied at the public reference
facilities of the Securities and Exchange Commission in Washington, DC and
Regional Offices of the Commission located at 7 World Trade Center, New York,
New York 10048 and Suite 1400, 500 West Madison Street, Chicago, Illinois
60621. Copies of such material can also be obtained by mail from the Public
Reference Branch, Office of Consumer Affairs and Information Services,
Securities and Exchange Commission, Washington, DC 20549 and its public
reference facilities in New York, New York and Chicago, Illinois, at prescribed
rates.
21
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EXHIBIT A
PLAN OF REORGANIZATION AND LIQUIDATION
PLAN OF REORGANIZATION AND LIQUIDATION dated as of April 22, 1997, adopted
by Van Eck Funds, a Massachusetts business trust (the "Trust"), on behalf of the
Gold Opportunity Fund, a series of the Trust, and the Gold/Resources Fund, a
series of the Trust. The Gold Opportunity Fund and the Gold/Resources Fund are
referred to collectively as the "Funds" and individually as a "Fund."
WITNESSETH:
WHEREAS, the Trust is an open-end management investment company registered
under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, this Plan is intended to be and is adopted as a plan of
reorganization and liquidation within the meaning of Section 368(a)(1)(C) of the
Internal Revenue Code of 1986, as amended, such reorganization to consist of the
transfer of all of the assets of the Gold Opportunity Fund in exchange solely
for Class A shares of beneficial interest, par value $0.001 per share, of the
Gold/Resources Fund ("Gold/Resources Fund Shares") and the assumption by the
Gold/Resources Fund of all of the stated liabilities of the Gold Opportunity
Fund and the distribution, after the Closing hereinafter referred to, of
Gold/Resources Fund Shares to the shareholders of the Gold Opportunity Fund in
liquidation of the Gold Opportunity Fund, all upon the terms and conditions
hereinafter set forth in this Plan; and
WHEREAS, the Trustees of the Trust, including a majority of the Trustees
who are not interested persons, have determined with regard to each Fund that
participating in the transactions contemplated by this Plan is in the best
interests of the respective Funds.
NOW, THEREFORE, the Trustees hereby declare the following Plan:
1. Transfer of Assets. Subject to the terms and conditions set forth
------------------
herein, at the closing provided for in Section 4 (herein referred to as the
"Closing"), the Trust shall transfer all of the assets of the Gold Opportunity
Fund, and assign all Assumed Liabilities (as hereinafter defined) to the
Gold/Resources Fund, and the Gold/Resources Fund shall acquire all such assets,
and shall assume all such Assumed Liabilities, upon delivery to the Trust of
Gold/Resources Fund Shares having a net asset value equal to the value of the
net assets of the Gold Opportunity Fund transferred (the "New Shares").
"Assumed Liabilities" shall mean all liabilities, expenses, costs, charges and
reserves reflected in an unaudited statement of assets and liabilities of the
Gold Opportunity Fund as of the close of business on the Valuation Date (as
hereinafter defined), determined in accordance with generally accepted
accounting principles consistently applied from the prior audited period. The
net asset value of the New Shares and the value of the net assets of the Gold
Opportunity Fund to be transferred shall be determined as of the close of
regular trading on the New York Stock Exchange on the business day next
preceding the Closing (the "Valuation Date") using the valuation procedures set
forth in the then current prospectus and statement of additional information of
the Gold/Resources Fund.
All Assumed Liabilities of the Gold Opportunity Fund, to the extent that
they exist at or after the Closing, shall after the Closing attach to the
Gold/Resources Fund and may be enforced against the Gold/Resources Fund to the
same extent as if the same had been incurred by the Gold/Resources Fund.
22
<PAGE>
2. Liquidation of the Gold Opportunity Fund. At or as soon as
----------------------------------------
practicable after the Closing, the Gold Opportunity Fund will be liquidated and
the New Shares delivered to the Trust on behalf of the Gold Opportunity Fund
will be distributed to shareholders of the Gold Opportunity Fund, each
shareholder to receive the number of New Shares equal to the pro rata portion of
shares of beneficial interest of the Gold Opportunity Fund held by such
shareholder as of the close of business on the Valuation Date. Such liquidation
and distribution will be accompanied by the establishment of an open account on
the share records of the Gold/Resources Fund in the name of each shareholder of
the Gold Opportunity Fund and representing the respective pro rata number of New
Shares due such shareholder. As soon as practicable after the Closing, the Trust
shall file on behalf of the Gold Opportunity Fund such instruments of
dissolution, if any, as are necessary to effect the dissolution of the Gold
Opportunity Fund and shall take all other steps necessary to complete
liquidation and dissolution of the Gold Opportunity Fund.
3. Conditions Precedent. The obligations of the Trust to effectuate the
--------------------
Plan of Reorganization and Liquidation hereunder shall be subject to the
satisfaction of the following conditions:
(a) At or immediately prior to the Closing, the Trust shall have
declared and paid a dividend or dividends which, together with all previous such
dividends, shall have the effect of distributing to the shareholders of the Gold
Opportunity Fund all of the Fund's investment company taxable income for taxable
years ending at or prior to the Closing (computed without regard to any
deduction for dividends paid) and all of its net capital gain, if any, realized
in taxable years ending at or prior to the Closing (after reduction for any
capital loss carry-forward);
(b) Such authority and orders from the Securities and Exchange
Commission (the "Commission") and state securities commission as may be
necessary to permit the Trust to carry out the transactions contemplated by this
Plan shall have been received;
(c) A registration statement of the Trust on Form N-14 under the
Securities Act of 1933, as amended (the "Securities Act"), registering the New
Shares under the Securities Act, and such amendment or amendments thereto as are
determined by the Board of Trustees of the Trust to be necessary and appropriate
to effect such registration of the New Shares (the "Registration Statement"),
shall have been filed with the Commission and the Registration Statement shall
have become effective, and no stop-order suspending the effectiveness of such
Registration Statement shall have been issued, and no proceeding for that
purpose shall have been initiated or threatened by the Commission (and not
withdrawn or terminated);
(d) The New Shares shall have been duly qualified for offering to the
public in all states in which such qualification is required for consummation of
the transactions contemplated hereunder.
(e) The Trustees of the Trust shall have received a legal opinion
from Goodwin, Procter & Hoar LLP, counsel to the Trust, in form and substance
reasonably satisfactory to the Trustees of the Trust, as to such matters as the
Trustees may reasonably request.
(f) A vote approving this Plan and the reorganization contemplated
hereby shall have been adopted by at least a majority (as defined in the 1940
Act) of the outstanding shares of beneficial interest of the Gold Opportunity
Fund entitled to vote at the Meeting of shareholders of the Gold Opportunity
Fund entitled to vote at the Meeting of shareholders of the Gold Opportunity
Fund duly called for such purpose.
4. Closing. The Closing shall be held at the offices of the Trust and
-------
shall occur (a) as of the close of business on ______________, 1997, (b) if all
regulatory or shareholder approvals shall not have been received, then on the
first Monday following receipt of all necessary regulatory approvals and the
final
23
<PAGE>
adjournment of meetings of shareholders of the Gold Opportunity Fund at which
this Agreement is considered or (c) such later time as the parties may agree.
All acts taking place at the Closing shall be deemed to take place
simultaneously unless otherwise provided. At, or as soon as may be practicable
following the Closing, the Trust shall distribute the New Shares to the Gold
Opportunity Fund Record Holders (as herein defined) by instructing the
Gold/Resources Fund to register the appropriate number of New Shares in the
names of the Gold Opportunity Fund's shareholders and the Gold/Resources Fund
agrees promptly to comply with said instruction. The shareholders of record of
the Gold Opportunity Fund as of the close of business on the Valuation Date
shall be certified by the Trust's transfer agent (the "Gold Opportunity Fund
Record Holders").
5. Expenses. The expenses of the transactions contemplated by this Plan
--------
shall be borne by Van Eck Associates Corporation. In addition, Van Eck
Associates Corporation has agreed to bear all of the unamortized organizational
costs of the Gold Opportunity Fund outstanding on the Closing.
6. Termination. This Plan and the transactions contemplated hereby may
-----------
be terminated and abandoned by resolution of the Board of Trustees of the Trust
with respect to either of the Gold Opportunity Fund or the Gold/Resources Fund,
at any time prior to the Closing, if circumstances should develop that, in the
opinion of the Board, in its sole discretion, make proceeding with this Plan
inadvisable for either Fund. In the event of any such termination, there shall
be no liability for damages on the part of either the Gold Opportunity Fund or
the Gold/Resources Fund, or their respective trustees or officers, to the other
party or its trustees or officers.
7. Amendments. This Plan may be amended, waived or supplemented in such
----------
manner as may be mutually agreed upon in writing by the authorized officers of
the Trust with respect to either Fund; provided, however, that following the
meeting of the Gold Opportunity Fund shareholders called by the Trust pursuant
to Section 3(f) of this Agreement, no such amendment, waiver or supplement may
have the effect of changing the provisions for determining the number of
Gold/Resources Fund Shares to be issued to the Gold Opportunity Fund
shareholders under this Plan to the detriment of such shareholders without their
further approval.
8. Governing Law. This Plan shall be governed and construed in
-------------
accordance with the laws of the Commonwealth of Massachusetts, without giving
effect to the conflicts of laws provisions thereof.
9. Further Assurances. The Trust, with respect to Gold Opportunity Fund
------------------
and Gold/Resources Fund, shall take such further action, prior to, at, and after
the Closing, as may be necessary or desirable and proper to consummate the
transactions contemplated hereby.
10. Limitations of Liability. The term "Van Eck Funds" means and refers
------------------------
to the trustees from time to time serving under the Amended and Restated Master
Trust Agreement (the "Master Trust Agreement") of the Trust, as the same may
subsequently thereto have been, or subsequently hereto be, amended. It is
expressly agreed that the obligations of the Trust hereunder shall not be
binding-upon any of the Trustees, shareholders, nominees, officers, agents or
employees of the Trust, personally, but bind only the assets and property of the
Gold Opportunity Fund or the Gold/Resources Fund series of the Trust, as the
case may be, as provided in the Master Trust Agreement. With respect to each
Fund, the execution and delivery of this Plan has been authorized by the
Trustees of the Trust and signed by an authorized officer of the Trust, acting
as such, and neither such authorization nor such execution and delivery shall be
deemed to have been made individually or to impose any personal liability, but
shall bind only the Trust property of the respective series of the Trust as
provided in Master Trust Agreement. The Master Trust Agreement of the Trust
provides, and it is expressly agreed, that each Fund shall be solely and
exclusively responsible for the payment of its debts, liabilities and
obligations, and that no other Fund shall be responsible for the same.
24
<PAGE>
IN WITNESS WHEREOF, the Trustees have caused this Plan to be executed on
behalf of each Fund as of the date first set forth above by their duly
authorized representatives.
Attest: VAN ECK FUNDS
on behalf of Gold Opportunity Fund and
Gold/Resources Fund
By:
_______________________________ ___________________________________
John C. van Eck, President
The undersigned hereby accept their obligation to pay expenses pursuant to
Section 5 hereof.
Attest: VAN ECK ASSOCIATES CORPORATION
By:
_______________________________ ___________________________________
Philip DeFeo, President
25
<PAGE>
STATEMENT OF ADDITIONAL INFORMATION
VAN ECK FUNDS
GOLD/RESOURCES FUND
GOLD OPPORTUNITY FUND
99 Park Avenue, 8th Floor
New York, New York 10016
1-800-221-2220
This Statement of Additional Information is not a prospectus and should be
read in conjunction with the Proxy Statement/Prospectus of Gold Opportunity Fund
(the "Fund" or "GOF"), a series of Van Eck Funds dated May __, 1997, which is
enclosed. This Statement of Additional Information has been incorporated by
reference into the Proxy Statement/Prospectus.
Further information about the Gold/Resources Fund series of Van Eck Funds
("GRF") is contained in and incorporated by reference to its latest prospectus,
dated April 30, 1997, its latest Statement of Additional Information, dated
April 30, 1997, its Annual Report to shareholders for the year ended December
31, 1996 and its Semi-Annual Report to shareholders for the six months ended
June 30,1996, all of which are incorporated by reference herein and are
available at no cost by either calling the Funds at the phone number listed
above or by writing to the Funds at the above address.
Further information about the Fund is contained in and incorporated by
reference to its latest prospectus, dated April 30, 1997, its latest Statement
of Additional Information, dated April 30, 1997, its Annual Report to
Shareholders for the year ended December 31, 1996 and its Semi-Annual Report to
shareholders for the six months ended June 30,1996, all of which are
incorporated by reference herein and are available at no cost by either calling
the Funds at the phone number listed above or by writing to the Funds at the
above address.
THIS STATEMENT OF ADDITIONAL INFORMATION IS DATED May __, 1997.
<PAGE>
TABLE OF CONTENTS
Page
----
GENERAL INFORMATION 2
GENERAL INFORMATION
The shareholders of GOF are being asked to approve an Agreement and
Plan of Reorganization and liquidation (the "Plan") which contemplates the
exchange of net assets of GOF for Class A shares of GRF and the distribution of
such shares to the shareholders of GOF. GRF is an open-end, diversified
management investment company and Van Eck Funds is organized as a Massachusetts
business trust. A Meeting of Shareholders to consider the Plan and other matters
described in the Proxy Statement/Prospectus will be held at 99 Park Avenue, 8th
Floor, New York, New York on _______________, 1997 at _____ a.m.
For detailed information about the Plan, shareholders of GOF should refer
to the Proxy Statement/Prospectus. For further information about GOF and GRF,
shareholders should refer to the Van Eck Funds Statement of Additional
Information, dated ________________, 1997, each Fund's Annual Report to
shareholders for the year ended December 31, 1996 and each Fund's Semi-Annual
Report to shareholders for the six months ended June 30, 1996, all of which are
incorporated by reference into this Statement of Additional Information.
2
<PAGE>
PART C
OTHER INFORMATION
ITEM 15. Indemnification
---------------
Reference is made to Article VI of the Master Trust Agreement of the
Registrant, as amended, previously filed as Exhibit (1) to the Registration
Statement.
Insofar as indemnification by the Registrant for liabilities arising under
the Securities Act of 1933 may be permitted to trustees, officers, underwriters
and controlling persons of the Registrant, pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification is against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a trustee, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted against the Registrant by such trustee, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question of whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
ITEM 16. Exhibits
--------
(1)Form of Amended and Restated Master Trust Agreement (Incorporated
by reference from Post-Effective Amendment No. 20); Form of Amendment to the
Master Trust Agreement changing the name of Short-Term World Income Fund to
Short-Term World Income Fund-C, and changing the name of International Equities
Fund to International Growth Fund (Incorporated by reference from Post-Effective
Amendment No. 20); Form of second Amendment to the Amended and Restated Master
Trust Agreement adding Asia Dynasty Fund as a series of the Trust (Incorporated
by reference from Post-effective Amendment No. 23); Third Amendment to the
Amended and Restated Master Trust Agreement adding Gold/Resources Fund as a
series of the Trust and changing the name of International Investors to
International Investors Gold Fund (incorporated by reference from Post-Effective
Amendment No. 28); Fourth Amendment to the Amended and Restated Master Trust
Agreement adding Global SmallCap Fund and Asia Infrastructure Fund as series of
the Trust (incorporated by reference from Post-effective Amendment No. 30); Form
of Fifth Amendment to the Amended and Restated Master Trust Agreement
(incorporated by reference from Post-effective Amendment No. 35); Form of Sixth
Amendment to Amended and Restated Master Trust Agreement (incorporated by
reference from Post-effective Amendment No. 35); Seventh Amendment to Amended
and Restated Master Trust Agreement adding Global Hard Assets Fund as series of
the Trust (incorporated by reference from Post-effective Amendment No. 36);
Eighth Amendment to Amended and Restated Master Trust Agreement adding Gold
Opportunity Fund as series of the Trust (incorporated by reference from Post-
effective Amendment No. 37).
1
<PAGE>
(2) By-laws of Registrant (incorporated by reference from Registration
Statement No. 2-97596).
(3) Not Applicable.
*(4) Form of Plan of Reorganization and Liquidation between Gold Opportunity
Fund and Gold/Resources Fund (See Exhibit A to Part A of this filing).
(5)(a) Form of certificate of shares of beneficial interest of the Global
Opportunity Fund (incorporated by reference from Pre-Effective
Amendment No. 35); Forms of certificates of shares of beneficial
interest of the Gold/Resources Fund (incorporated by reference from
Post-Effective Amendment No. 1);
(5)(b) Instruments defining rights of security holders (See Exhibit (1)
above).
(6)(a) Advisory Agreement (incorporated by reference from Post-Effective
Amendment No. 1).
(6)(b) Letter Agreement to add Gold/Resources Fund and International Investors
Gold Fund (incorporated by reference from Post-effective Amendment No.
34).
(6)(c) Form of Letter Agreement to add Gold Opportunity Fund (incorporated by
reference from Post-effective Amendment No. 37).
(7)(a) Distribution Agreement (incorporated by reference from Post-Effective
Amendment No. 1).
(7)(b) Letter Agreement to add Gold/Resources Fund and U.S. Government Money
Fund (incorporated by reference from Post-Effective Amendment No. 1);
(7)(c) Letter Agreement to add Gold/Resources Fund-C, International Investors
Gold Fund-C, Global SmallCap Fund-C and Asia Infrastructure Fund-C
(incorporated by reference from Post-effective Amendment No. 34) Form
of Letter Agreement to add Gold Opportunity Fund (incorporated by
reference from Post-effective Amendment No. 37).
(7)(d) Amendment to Form of Selling Group Agreement (incorporated by reference
from Post-Effective Amendment No. 9).
(7)(e) Selling Agency Agreement (incorporated by reference from Post-Effective
Amendment No. 12).
(8) Not Applicable.
(9)(a) Custodian Agreement (incorporated by reference from Post-Effective
Amendment No. 1).
(9)(a)(1)Form of Custody Agreement between the Van Eck Funds and Bankers Trust
Company (Incorporated by reference from Post-Effective Amendment No.
20).
2
<PAGE>
(9)(b) Letter Agreement to add Gold/Resources Fund and U.S. Government Money
Fund (incorporated by reference from Post-Effective Amendment No. 1).
(9)(c) Letter Agreement to add Gold Opportunity Fund (incorporated by
reference to Post-Effective Amendment No. __).
(10) Form of Plan of Distribution with respect to Gold/Resources Fund (Class
A and B)(incorporated by reference from Post-Effective Amendment No.
26). Form of Plan of Distribution with respect to Gold/Resources Fund
(Class C)(incorporated by reference from Post-effective Amendment No.
34).
(10)(a) Form of Letter Agreement to add Gold Opportunity Fund (Class A)
(incorporated by reference from Post-effective Amendment No. 37). Form
of Letter Agreement to add Gold Opportunity Fund (Class C)
(incorporated by reference from Post-effective Amendment No. 37).
(11) Opinion of Goodwin, Procter & Hoar LLP, including consent.
(12) Copy of legal opinion from Goodwin, Procter & Hoar LLP, supporting the
tax matters and consequences to shareholders discussed in the
prospectus.*
(13)(a) Accounting and Administrative Services Agreement with respect to
Gold/Resources Fund (incorporated by reference from Post-effective
Amendment No. 31).
(13)(b) Letter Agreement to add Gold/Resources Fund and International Investors
Gold Fund (incorporated by reference from Post-effective Amendment No.
34). Letter Agreement to add Gold Opportunity Fund (incorporated by
reference from Post-effective Amendment No. 37).
(14) Consent of Coopers & Lybrand L.L.P.
(15) Not Applicable.
(16) Not Applicable.
_______________
*To be filed by amendment
3
<PAGE>
(17)(a) Combined Prospectus for Gold Opportunity Fund and Gold/Resources Fund
Filed via EDGAR in Post-Effective Amendment No. 49 on March 3, 1997 to
the Registration Statement for Van Eck Funds (1933 Act No. 2-97596).
(17)(b) Combined Statement of Additional Information for Gold Opportunity Fund
and Gold/Resources Fund filed via EDGAR in Post-Effective AmendmentS
No. 49 on March 3, 1997 and 50 on March 18, 1997 to the Registration
Statement for Van Eck Funds (1933 Act. No. 2-97596).
(17(c) 1996 Annual Report for Gold Opportunity Fund filed via EDGAR on March
4, 1997.
(17)(d) Semi-Annual Report for Period ended June 30, 1996 for Gold Opportunity
Fund filed via EDGAR on August 28, 1996.
(17)(e) 1996 Annual Report for Gold/Resources Fund filed via EDGAR on February
28, 1997.
(17)(f) Semi-Annual Report for period ended June 30, 1996 for Gold/Resources
Fund via EDGAR on August 28, 1996.
Item 17. Undertakings
(1) The undersigned Registrant agrees that prior to any public reoffering
of the securities registered through the use of a prospectus which is
part of this registration statement by any person or party who is
deemed to be an underwriter within the meaning of Rule 145(c) of the
Securities Act of 1933, as amended, the reoffering prospectus will
contain the information called for by the applicable registration form
for reofferings by persons who may be deemed underwriters, in addition
to the information called for by the other items of the applicable
form.
(2) The undersigned Registrant agrees that every prospectus that is filed
under paragraph (1) above will be filed as a part of an amendment to
the registration statement and will not be used until the amendment is
effective, and that, in determining liability under the Securities Act
of 1933, as amended, each post-effective amendment shall be deemed to
be a new registration statement for the securities offered therein,
and the offering of the securities at that time shall be deemed to be
the initial bona fide offering of them.
4
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
----------
As required by the Securities Act of 1933, this Registration Statement on
Form N-14 has been signed on behalf of the Registrant by the undersigned,
thereunto duly authorized, in the City of New York, State of New York, on the
22nd day of May, 1997.
VAN ECK FUNDS
By: /s/ John C. van Eck
___________________________
John C. van Eck, President and CEO
KNOW ALL MEN BY THESE PRESENTS that each individual whose signature appears
below constitutes and appoints John C. van Eck, Thaddeus Leszcyzynski and Susan
Grant, and each of them, his true and lawful attorneys-in-fact and agents with
full power of substitution, for him and in his name, place and stead, in any and
all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement on Form N-14, and to file the same,
with all exhibits thereto, and all documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated:
Signature Title Date
/s/ John C. van Eck Trustee and May 22, 1997
___________________ Chief Executive
John C. van Eck Officer
/s/ Bruce J. Smith Principal Accounting May 22, 1997
___________________ Officer
Bruce J. Smith
/s/ Jeremy Biggs Trustee May 22, 1997
___________________
Jeremy Biggs
___________________ Trustee May __, 1997
Richard Cowell
<PAGE>
____________________ Trustee May __, 1997
Philip DeFeo
/s/ Wesley G. McCain
____________________ Trustee May 22, 1997
Wesley G. McCain
/s/ Ralph F. Peters
____________________ Trustee May 22, 1997
Ralph F. Peters
____________________ Trustee May __, 1997
David J. Olderman
____________________ Trustee May __, 1997
Richard Stamberger
/s/ Fred M. van Eck
____________________ Trustee May 22, 1997
Fred M. van Eck
<PAGE>
Front of Proxy
- ---------------
VAN ECK FUNDS
GOLD OPPORTUNITY FUND
PROXY FOR SPECIAL SHAREHOLDERS MEETING TO BE HELD ________ __, 1997
The undersigned shareholder of GOLD OPPORTUNITY FUND, (the "Fund"), a
series of Van Eck Funds (the "Trust"), having received Notice of the Meeting of
Shareholders of the Fund to be held on ________ __, 1997 and the Proxy
Statement/Prospectus accompanying such Notice, hereby constitutes and appoints
Thaddeus Leszczynski, Barbara Allen and Susan Grant and each of them, true and
lawful attorneys or attorney for the undersigned, with several powers of
substitution, for and in the name, place and stead of the undersigned, to attend
and vote all shares of the Fund which the undersigned would be entitled to vote
at the Meeting to be held at 99 Park Avenue, 8th Floor, New York, New York, on
_________, ________ __, 1997, at [____] New York Time, and at any and all
adjournments thereof, with all powers the undersigned would possess if
personally present.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE FOR THE PROPOSAL ON THE REVERSE
SIDE HEREOF. THE SHARES REPRESENTED HEREBY WILL BE VOTED AS INDICATED ON THE
REVERSE SIDE OR FOR THE PROPOSAL IF NO CHOICE IS INDICATED.
PLEASE MARK YOUR PROXY, DATE AND SIGN IT ON THE REVERSE SIDE AND RETURN IT
PROMPTLY IN THE ACCOMPANYING ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES.
<PAGE>
Back of Proxy
- -------------
PROPOSAL
1.To approve the Agreement and Plan of Reorganization and Liquidation involving
the exchange of substantially all of the Fund's assets for shares of
Gold/Resources Fund, another series of the Trust, the assumption of liabilities
of the Fund by Gold/Resources Fund, the distribution of such shares to the
shareholders of the Fund and the subsequent liquidation of the Fund.
FOR _____ AGAINST ____ ABSTAIN _____
Dated: _______________________ 1997
-------------------------------
Signature of Shareholder
-------------------------------
Signature of Co-Owner
For joint accounts, all co-owners must
sign. Executors, administrators,
trustees, etc. should so indicate when
signing.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 2
<NAME> GOLD RESOURCES
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-02-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 97,717,075
<INVESTMENTS-AT-VALUE> 133,464,963
<RECEIVABLES> 73,206
<ASSETS-OTHER> 1,950
<OTHER-ITEMS-ASSETS> 905
<TOTAL-ASSETS> 133,541,054
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,242,679
<TOTAL-LIABILITIES> 1,242,679
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 167,482,628
<SHARES-COMMON-STOCK> 23,115,766
<SHARES-COMMON-PRIOR> 27,960,497
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 656,109
<ACCUMULATED-NET-GAINS> (70,274,715)
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 35,746,571
<NET-ASSETS> 132,298,375
<DIVIDEND-INCOME> 1,315,925
<INTEREST-INCOME> 217,350
<OTHER-INCOME> 0
<EXPENSES-NET> 2,731,109
<NET-INVESTMENT-INCOME> (1,197,834)
<REALIZED-GAINS-CURRENT> 11,607,157
<APPREC-INCREASE-CURRENT> (3,340,865)
<NET-CHANGE-FROM-OPS> 7,066,900
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 15,679,748
<NUMBER-OF-SHARES-REDEEMED> 20,524,479
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (23,676,001)
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (81,870,180)
<OVERDISTRIB-NII-PRIOR> (671,349)
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 1,198,836
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 2,731,109
<AVERAGE-NET-ASSETS> 159,794,000
<PER-SHARE-NAV-BEGIN> 5.58
<PER-SHARE-NII> (0.06)
<PER-SHARE-GAIN-APPREC> 0.20
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 5.72
<EXPENSE-RATIO> 1.71
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<SERIES>
<NUMBER> 3
<NAME> GOLD OPPORTUNITY
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-02-1996
<PERIOD-END> DEC-31-1996
<INVESTMENTS-AT-COST> 11,156,127
<INVESTMENTS-AT-VALUE> 10,092,837
<RECEIVABLES> 172,574
<ASSETS-OTHER> 11,987
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 10,277,398
<PAYABLE-FOR-SECURITIES> 11,013
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 81,586
<TOTAL-LIABILITIES> 92,599
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 11,445,874
<SHARES-COMMON-STOCK> 1,007,112
<SHARES-COMMON-PRIOR> 207,972
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 195,278
<ACCUM-APPREC-OR-DEPREC> (1,065,797)
<NET-ASSETS> 10,184,799
<DIVIDEND-INCOME> 70,280
<INTEREST-INCOME> 42,064
<OTHER-INCOME> 0
<EXPENSES-NET> 99,542
<NET-INVESTMENT-INCOME> 12,802
<REALIZED-GAINS-CURRENT> (134,737)
<APPREC-INCREASE-CURRENT> (1,042,260)
<NET-CHANGE-FROM-OPS> (1,164,195)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 19,611
<DISTRIBUTIONS-OF-GAINS> 49,771
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 1,406,869
<NUMBER-OF-SHARES-REDEEMED> 613,618
<SHARES-REINVESTED> 5,889
<NET-CHANGE-IN-ASSETS> 6,173,162
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> (3,961)
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 85,839
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 284,770
<AVERAGE-NET-ASSETS> 8,606,000
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<PAGE>
[LETTERHEAD OF GOODWIN, PROCTER & HOAR LLP]
TELEPHONE (617) 670-1000
TELECOPIER (617) 523-1231
May 22, 1997
Van Eck Funds
99 Park Avenue
New York, New York 10016-1580
Gentlemen:
As counsel to Van Eck Funds (the "Trust"), we have been asked to render
our opinion in connection with the issuance by the Trust of shares of the
Gold/Resources Fund (the "Fund"), a series of the Trust, pursuant to a certain
Plan of Reorganization and Liquidation (the "Plan"), as more fully described in
the Proxy Statement/Prospectus and Statement of Additional Information contained
in the Registration Statement on Form N-14 (the "Registration Statement") being
filed by the Trust in connection with the proposed reorganization of the Fund
with Gold Opportunity Fund, another series of the Trust.
We have examined the Amended and Restated Agreement and Declaration of
Trust dated February 6, 1992 of the Trust, as amended to date, the By-Laws of
the Trust, as amended to date, certain resolutions adopted by the Board of
Trustees of the Trust, the Registration Statement and such other documents as we
deemed necessary for purposes of this opinion.
Based upon the foregoing, we are of the opinion that the shares of the
Fund that are the subject of the Registration Statement will, when sold in
accordance with the terms of the Plan, be legally issued, fully paid and
non-assessable by the Trust.
We consent to being to named in the Proxy Statement/Prospectus and to
Statement of Additional Information contained in the Registration Statement and
a copy of this opinion being filed as an exhibit to the Registration Statement.
Very truly yours,
/s/ Goodwin, Procter & Hoar LLP
Goodwin, Procter & Hoar LLP
<PAGE>
EXHIBIT 17
Coopers Coopers & Lybrand L.L.P
& Lybrand
a professional services firm
CONSENT OF INDEPENDENT ACCOUNTANTS
---------------------
We consent to the incorporation by reference in the Registration Statement of
Van Eck Funds on Form N-14 of our reports dated February 21, 1997, on our audits
of the financial statements and financial highlights of the Gold Opportunity
Fund and the Gold/Resources Fund of the Van Eck Funds, which reports are
included in the Annual Reports to Shareholders for the years ended December 31,
1996, which are also incorporated by reference in this Registration Statement.
We also consent to the reference to our firm under the captions "Financial
Highlights" in this registration statement.
Coopers & Lybrand L.L.P.
/s/ Coopers & Lybrand L.L.P.
New York, New York
May 22, 1997
