<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Van Eck Worldwide Insurance Trust
- - - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- - - --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
VAN ECK WORLDWIDE INSURANCE TRUST
99 Park Avenue, 8th Floor
New York, NY 10016
August __, 1995
Dear Shareholder:
Attached are the Notice and Joint Proxy Statement for a Special Meeting of
Shareholders of the Trust to be held on September __, 1995. There are a number
of issues on which you, the shareholder, are being asked to vote which will
affect your Fund. These include election of Trustees, approval of independent
accountants for the Trust, amendments to the Master Trust Agreement, and the
approval of a new investment advisory agreement
Please note that not all the proposals set forth in the notice and joint proxy
statement apply to your Fund. A table of the proposals that apply to your Fund
can be found on page 3 of the Proxy Statement. IF YOU HOLD SHARES IN MORE THAN
ONE FUND, YOU WILL RECEIVE A SEPARATE PROXY PACKAGE FOR EACH FUND YOU HOLD.
PLEASE BE SURE TO SIGN AND RETURN EACH PROXY CARD REGARDLESS OF HOW MANY YOU
RECEIVE.
Please read the proxy statement carefully. It discusses the proposals as well as
the reasons why the Board of Trustees recommends that you vote FOR the
proposals.
Please take a moment now to sign and return the proxy card in the enclosed
postage-paid envelope. Your prompt attention in this matter benefits all
shareholders. Thank you.
Sincerely,
John C. van Eck
________________________________________________________________________________
Gold and Natural Resources Fund Worldwide Bond Fund Worldwide Balanced Fund
Worldwide Hard Assets Fund Worldwide SmallCap Fund
<PAGE>
VAN ECK WORLDWIDE INSURANCE TRUST
99 Park Avenue, New York, New York 10016
PROXY STATEMENT
Special Meeting of Shareholders
, 1995
This Proxy Statement is furnished to shareholders of the Gold and Natural
Resources Fund ("GNRF"), Worldwide Bond Fund ("WBF"), Worldwide SmallCap Fund
("WSF"), Worldwide Hard Assets Fund (WHAF") and Worldwide Balanced Fund ("WWBF")
series (the "Funds") of Van Eck Worldwide Insurance Trust (the "Trust") in
connection with the solicitation by the Board of Trustees of the Trust of
proxies to be used at the Special Meeting of Shareholders ("Special Meeting") of
the Trust to be held at 99 Park Avenue, New York, New York 10016, on __________,
1995, for the purposes set forth in the accompanying Notice of Special Meeting
of Shareholders. The enclosed proxy can be revoked by notice in writing to the
Trust at any time before it is exercised. Shareholders who execute proxies may
still vote in person at the Special Meeting if they so desire. The cost of
soliciting proxies will be borne equitably by each of the Funds and in the care
of WBF and GNRF by the Adviser. In addition to solicitation by mail, some of the
Trust's officers and employees, without extra remuneration, may conduct
additional solicitations by telephone, telegraph and personal interview. This
proxy soliciting material is being mailed to shareholders on or about
__________, 1995.
The Trust and the Funds serve as a funding medium for the variable annuity
accounts and variable life contracts of insurance companies. Nationwide Life
Insurance Company, Provident Mutual Life, American International Group and
Security Life of Denver are the participating insurance companies in the Trust
(each a "PIC" and together "PICs") entitled to vote as shareholders. Each PIC
provides pass-through voting rights to its variable contractholders. Among these
rights is the right to vote on each of the proposals affecting the respective
Fund - e.g. to elect Trustees, the right to approve the selection of independent
certified public accountants, the right to amend the Master Trust Agreement and
the right to approve investment advisory contracts for each of the Funds. For
shares held by Nationwide and for which no voting instructions have been
received from contractholders, each PIC will vote the shares in the same
proportion as the shares for which voting instructions have been received. The
variable contracts are described in the separate account prospectus issued by
the PICs.
Under certain circumstances, each PIC has the right to disregard the voting
instructions of its variable contractholders. The Trust's Board of Trustees does
not believe that these circumstances exist with respect to the matters to be
considered at the Special Meeting.
The contractholders permitted to give instructions for each of the Funds and the
number of shares for which instructions may be given will be determined as of
________________, 1995, the record date for the Special Meeting.
Each proxy will be voted in accordance with the shareholder's instructions. If
no such instructions are indicated, the proxy will be voted FOR election of the
three Trustees, FOR ratification of Coopers & Lybrand as the Trust's independent
auditors, FOR approval to amend the reorganization and liquidation provisions of
the Master Trust Agreement (the "Trust Agreement") with respect to each Fund,
FOR approval to amend the voting provision of the Trust Agreement for each Fund,
FOR approval to amend the amendment provision of the Trust Agreement with
respect to each Fund and FOR approval of the proposed new Investment Advisory
Agreement for each of GNRF and WBF.
1
<PAGE>
A proxy that is properly executed and returned accompanied by instructions to
withhold authority to vote with respect to any matter 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 Special 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 Special 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.
Only shareholders of record at the close of business on _________, 1995, are
entitled to notice of, and to vote at, the Special Meeting and any adjournment
thereof.
ANNUAL REPORT
The Funds' annual reports for the year ended April 30, 1995 were previously sent
to shareholders. Additional copies of the reports may be requested by calling
the number on the Notice of Meeting accompanying this Proxy Statement or by
writing to the Trust at the address thereon.
SHARES OF BENEFICIAL INTEREST OUTSTANDING
The Trust issues shares of beneficial interest with respect to each of the
Funds. As of August, 1995 there were outstanding and entitled to vote _____
shares of beneficial interest of GNRF, _____ shares of beneficial interest of
WBF, _____ shares of beneficial interest of WSF, _____ shares of beneficial
interest of WHAF, _____ shares of beneficial interest of WWBF. There were no
persons or groups who were known by the Trust to own beneficially more than 5%
of the outstanding shares of beneficial interest of any of the Funds as of
___________, 1995.
SHAREHOLDER MEETINGS
The Trust is organized as a Massachusetts business trust and as such is not
required to hold regular or annual meetings of shareholders unless otherwise
required by the Investment Company Act of 1940 (the "Act") or as may be required
by the Trust Agreement. For example, the Act requires that shareholders also
have the opportunity to vote for the election of Trustees at any time, for
whatever reason, a majority of the Board of Trustees is not comprised of
Trustees who were elected by vote of a majority of the outstanding shares of the
Trust. In addition, shareholders representing ten percent or more of the
outstanding shares of the Trust shall have the right to compel the Trustees to
call a meeting of shareholders to consider removal of any Trustee or Trustees.
2
<PAGE>
SUMMARY OF PROPOSALS
<TABLE>
<CAPTION>
PROPOSAL 1 PROPOSAL 2 PROPOSAL 3 PROPOSAL 4 PROPOSAL 5 PROPOSAL 6
<S> <C> <C> <C> <C> <C> <C>
Gold and Natural X X X X X X
Resources Fund
Worldwide Bond X X X X X X
Fund
Worldwide Balanced X X X X X
Fund
Worldwide Hard X X X X X
Assets Fund
Worldwide SmallCap X X X X X
Fund
</TABLE>
3
<PAGE>
PROPOSAL 1
ELECTION OF TRUSTEES
VAN ECK WORLDWIDE INSURANCE TRUST
SHAREHOLDERS OF ALL FUNDS WILL VOTE ON PROPOSAL 1 AS A SINGLE CLASS.
Under the Trust Agreement, no annual or regular meeting of shareholders is
required. Thus, there will ordinarily be no shareholder meetings unless required
by the Act. The Trust has called this Special Meeting of shareholders in order
for the shareholders to, among other proposals, elect three Trustees. The Trust
currently has nine Trustees, three of whom have not been elected by
shareholders. The Trustees have proposed that RODGER LAWSON, DAVID OLDERMAN AND
RICHARD STAMBERGER, the three Trustees who have never been elected by
shareholders, be elected at the Meeting.
INFORMATION AS TO NOMINEES AND TRUSTEES
It is intended that the accompanying proxy will be voted at the Special Meeting
for the election of the three persons listed below as Trustees of the Trust.
Such Trustees shall serve as such until their successors shall be elected and
shall qualify. The Trustees are a self-perpetuating body until less than a
majority of the Trustees serving as such are elected by shareholders. Another
meeting of shareholders will be called to elect Trustees only when less than a
majority shall be elected to office by shareholders. If, for reasons not now
foreseen, one or more of the nominees is for any reason unable or unwilling to
be a nominee at the time of the Special Meeting, the proxy holders shall have
the right to vote for another candidate in accordance with their judgment. All
of the nominees have agreed to serve as Trustees if elected.
The following table sets forth a list of the Trustees and nominees of the Trust,
together with their ages and memberships on Committees of the Trust's Board of
Trustees.
Name, Principal Occupation and Business Experience
and Positions Held in the Trust
-------------------------------
NOMINEES
RODGER A. LAWSON@
99 Park Avenue, New York, New York 10016; Trustee of other affiliated investment
companies advised by Van Eck Associates Corporation (the "Adviser"); President,
Chief Executive Officer and a Director of the Adviser and Van Eck Securities
Corporation; Former Managing Director and Head of Global Private Banking and
Mutual Funds, Bankers Trust Company (1992 - 1994); Former Managing Director,
Member of the Management Committee, and President/CEO of Fidelity Investments
Retail Group, FMR Corp. (1985 - 1991); Former Corporate Officer, Member of the
Management Committee, and Head of all Retail and Institutional Businesses,
Dreyfus Corporation (1982 - 1985). Age 48; first served as Trustee in 1994.
DAVID J. OLDERMAN
560 Lexington Avenue, New York, New York 10022; Chairman of the Board, Chief
Executive Officer and Owner, Carret & Company, Inc. (since 1988); Chairman of
the Board, American Copy Equipment Co. (1991-present); Chairman of the Board,
Brighton Partners, Inc. (1993-present); Principal, Olderman & Raborn, Inc.,
(investment advisers-1984-1988); Chairman of the Board, Railoc, Inc., (farm
equipment manufacturing-1979-1984); Head of Corporate Finance, Halsey Stuart
(investment Banking-1974-1975); Vice Chairman of the Board, Stone and Webster
Securities Corp. (investment banking, retail sales and investment advisory
divisions-1964 to 1974). Age 59; first served as Trustee in 1994.
4
<PAGE>
RICHARD STAMBERGER
888 17th Street, N.W., Washington, D.C. 20006; Principal, National Strategies,
Inc., a public policy firm in Washington, D.C.; Executive Vice President, Chief
Operating Officer, and a Director of NuCable Resources Corporation (technology
firm/since 1988); associated with Anderson Benjamin & Reed, a regulatory
consulting firm based in Washington, D.C. (1985-1986); White House Fellow-Office
of Vice President (1984-1985); Director of Special Projects, National Cable
Television Association (1983-1984). Age 36; first served as Trustee in 1994.
TRUSTEES
JOHN C. VAN ECK*@
270 River Road, Briarcliff Manor, New York; Chairman of the Board and President
of other affiliated investment companies advised by the Adviser, Van Eck
Associates Corporation (investment adviser); Chairman and President, Van Eck
Securities Corporation (broker-dealer); Director, Eclipse Financial Asset Trust
(mutual fund), Abex Inc. (aerospace), Former and President of the Adviser and
its affiliated companies; Former Director (1983-1986), The Signal Companies,
Inc. (high technology and engineering); Former Director (1982-1984), Pullman
Transportation Co., Inc. (transportation equipment). Former Director (1986-1992)
The Henley Group, Inc. (technology and health). Age 79; first served as Trustee
in 1985.
JEREMY H. BIGGS@+#
1220 Park Avenue, New York, NY 10128; Trustee of other affiliated investment
companies advised by the Adviser; Vice Chairman, Director and Chief Investment
Officer, Fiduciary Trust Company International (investment manager) parent
company of Fiduciary International, Inc., which serves as sub-advisor to the
Global Balanced Fund); Director to all funds of Ventures Advisers Group (mutual
fund management company); Former Director, International Investors Incorporated
(1990-1991). Age 59; first served as Trustee in 1990.
RICHARD C. COWELL#+
121 El Bravo Way, Palm Beach, Florida; Trustee of other affiliated investment
companies advised by the Adviser; Private Investor; Director, West Indies &
Caribbean Development Ltd. (real estate); Director, Compo Industries, Inc.
(machinery manufacturer); Former Director, International Investors Incorporated
(1957-1991); Former Director (1978-1981), American Eagle Petroleums, Ltd. (oil
and gas exploration); Former President and Director (1968-1976), Minerals and
Industries, Inc. (petroleum products); Former Director (1978-1983) Duncan Gold
Resources, Inc. (oil exploration and gold mining); Former Director (1981-1984),
Crested Butte Silver Mining Co.; Former Chairman and Member of Executive
Committee (1974-1981), Allerton Resources, Inc. (oil and gas exploration);
Former Director (1976-1982), Western World Insurance Co. Age 67; first served as
Trustee in 1985.
WESLEY G. MCCAIN#+
144 East 30th Street, New York, New York 10016; Chairman, Towneley Capital
Management, Inc., (investment adviser); Chairman, Eclipse Financial Asset Trust
(mutual fund); Trustee of other affiliated investment companies advised by the
Adviser; General Partner, Pharoah Partners, L.P.; President, Millbrook
Associates, Inc.; Trustee, Libre Group Trust; Chairman, Eclipse Financial
Services, Inc.; Former Director, International Investors Incorporated; and
Former Secretary and Treasurer, Millbrook Advisers, Inc. (investment adviser);
Former Chairman, Finacor, Inc. (financial services). Age 53; first served as
Trustee in 1989.
RALPH F. PETERS#*
55 Strimples Mill Road, Stockton, New Jersey 08559; Trustee of other affiliated
investment companies advised by the Adviser; Former Chairman of the Board and
Chief Executive Officer of Discount
5
<PAGE>
Corporation of New York (dealer in U.S. Treasury and Federal Agency Securities)
(1981-1988); Director, Sun Life Insurance and Annuity Company of New York;
Director, U.S. Life Income Fund, Inc., New York. Former Director, International
Investors Incorporated. Age 66; first served as Trustee in 1987.
FRED VAN ECK@**
99 Park Avenue, New York, New York; Private Investor; Trustee of other
affiliated investment companies advised by the Adviser; Director, Van Eck
Associates Corporation; Director, Van Eck Securities Corporation; Former General
Partner (1950-1976) J. H. Whitney & Co. (venture capital). Age 77; first served
as Trustee in 1985.
_____________
@ An "interested person" as defined in the Act.
* Member of Executive Committee - exercises general powers of Board of
Trustees between meetings of the Board.
** Brother of Mr. John C. van Eck.
# Member of Nominating Committee.
+ Member of Audit Committee - reviews fees, services, procedures, conclusions
and recommendations of independent auditors.
During the Trust's last fiscal year the Board of Trustees met five times, its
Executive Committee met one time and its Audit Committee met two times. Of the
nine Trustees, each attended at least 75% of the meetings they were entitled to
attend. The Trust has a standing Nominating Committee which recruits prospective
Board members. The Nominating Committee consists of Messrs. Peters, Biggs,
Cowell, McCain and Olderman. The Nominating Committee met once in 1994 and has
not met in 1995.
The Executive Committee exercises the general powers of the Trust's Board of
Trustees between meetings of the Board of Trustees, and at each Executive
Committee meeting reviews economic and other developments affecting the Trust's
investment policies, considers reports on portfolio companies, values restricted
and other securities held by the Trust and oversees other administrative and
operating matters. The Executive Committee consists of Messrs. John C. van Eck
and Ralph F. Peters. The Executive Committee did not meet in 1994.
The Audit Committee reviews with the Trust's independent auditors the scope of
their services, their audit procedures, and their conclusions and
recommendations with respect to the Trust's internal accounting controls,
considers the reasonableness of the auditors' fees and makes recommendations to
the Board of Trustees regarding the engagement of the Trust's auditors. The
Audit Committee consists of Messrs. Biggs, Cowell and McCain. It met once in
1994 and 1995.
As set forth below in Proposal 7, "Approval of Proposed New Investment Advisory
Agreement," Mr. John C. van Eck is Chairman of the Board and, together with
members of his immediately family, owns 100% of the voting securities of the
Adviser, and as such is an "interested person" of the Trust and the Funds, as
defined in the Act. Mr. Fred van Eck, a Trustee of the Trust, is the brother of
Mr. John C. van Eck and a Director of the Adviser and as such is an "interested
person" of the Trust and the Funds. Jeremy Biggs serves as Vice Chairman,
Director and Chief Investment Officer of Fiduciary Trust Company International,
the parent company of Fiduciary International, Inc., which is the sub-investment
advisor to the Worldwide Balanced Fund, and as such is an interested person of
the Funds.
For biographical information on the Trust's Officers, please see "Officers of
Trust" under the caption "Additional Information" below.
6
<PAGE>
COMPENSATION OF TRUSTEES
Trustees are paid an annual retainer, payable quarterly, of $15,000 and $4,000
for attendance at each meeting of the Board of Trustees of the Trust and Van Eck
Funds. These fees are allocated among each of the series of the Trust and Van
Eck Funds on the basis of relative net assets. The following compensation table
shows the fees paid during 1994 by the Trust and Van Eck Funds to each Trustee:
Name of Trustee Aggregate Compensation *
- - - --------------- ----------------------
Jeremy H. Biggs $22,500
Richard C. Cowell $22,500
Wesley G. McCain $22,500
Ralph F. Peters $18,500
David Olderman $ 9,000
Richard Stamberger $ 9,000
Fred van Eck $ 0
Rodger A. Lawson $ 0
John C. van Eck $ 0
* The fee rate in effect in 1994 was a meeting fee of $3,500 for attendance at
each meeting.
The Adviser pays Trustee's fees of Fred M. van Eck; neither Rodger Lawson nor
John C. van Eck is paid any fees for serving as a Trustee. The salary and
benefit payments and Trustee's fees paid by the Adviser are not obligations of
the Trust. During 1994, no contingent forms of compensation were paid by the
Trust to any officer or Trustee. In addition, there are no pension or retirement
benefits paid by the Trust.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF
RODGER A. LAWSON, DAVID J. OLDERMAN AND RICHARD STAMBERGER AS TRUSTEE OF THE
TRUST.
REQUIRED VOTE
All shares of the Trust will be voted as a single class on Proposal 1. In the
election of Trustees of the Trust, those candidates receiving a plurality of the
votes cast at a meeting at which a quorum is present shall be elected.
PROPOSAL 2
RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
VAN ECK WORLDWIDE INSURANCE TRUST
SHAREHOLDERS OF ALL FUNDS WILL VOTE ON PROPOSAL 2 AS A SINGLE CLASS.
Coopers & Lybrand have been the independent public accountants for the Trust
since February 28, 1992. Coopers & Lybrand do not have any connection with, or
financial interest in, the Trust, either directly or indirectly.
The Trust's Board of Trustees, including a majority of the Trustees who are not
"interested persons" of the Trust, has selected Coopers & Lybrand to act as the
Trust's auditors and recommends that the shareholders ratify the selection. The
engagement of Coopers & Lybrand as the Trust's auditors is subject to the right
of the holders of a majority of the outstanding voting securities (as defined in
the Act) of the Trust to terminate such employment without penalty at a meeting
called for such purpose.
7
<PAGE>
A representative of Coopers & Lybrand will be present at the Special Meeting,
will have an opportunity to make a statement and will be available to respond to
appropriate questions.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL OF PROPOSAL
2.
REQUIRED VOTE
All shares of the Trust will be voted as a single class. The approval of Coopers
& Lybrand as the Trust's independent public accountants will require the
affirmative vote of a majority of the votes cast at a meeting at which a quorum
is present.
PROPOSAL 3
AMENDMENTS TO THE MASTER TRUST AGREEMENT TO PERMIT THE TRUSTEES TO
REORGANIZE, MERGE OR LIQUIDATE A FUND WITHOUT PRIOR SHAREHOLDER APPROVAL
SHAREHOLDERS OF ALL FUNDS WILL VOTE ON PROPOSAL 3 WITH EACH FUND VOTING AS A
SEPARATE CLASS.
Van Eck Worldwide Insurance Trust is organized as a Massachusetts business
trust. One of the advantages of operating a mutual fund as a business trust,
rather than a corporation, is the substantial operational flexibility available
to the trustees. The trustees of a business trust are permitted to take a
variety of actions, without prior shareholder approval, that are not permitted
to directors of a corporation. As a result, the trustees of a business trust are
able to react quickly on behalf of shareholders to changes in competitive and
regulatory conditions, without incurring the costs of a shareholder meeting.
The particular actions that may be taken by the Trustees of the Trust without a
shareholder meeting are determined by the terms of the Trust's Trust Agreement,
subject to compliance with applicable laws, such as the Act. Currently, the
Master Trust Agreement provides that shareholder approval is required to
reorganize, merge or liquidate a Fund. Shareholder approval for these actions is
not required, however, by the Act or by Massachusetts law.
The Board of Trustees believe that , in most circumstances, it is not in the
best interests of shareholders to require a meeting of shareholders to
reorganize, merge or liquidate a Fund. For example, a Fund may have insufficient
assets to operate efficiently. In such a case, the Trustees may determine that
it would be in the best interests of shareholders of the Fund to merge the Fund
with another mutual fund that has similar investment objectives or policies,
which would have the effect of reducing the per share expenses of each Fund. The
process of obtaining shareholder approval for such a transaction, however, may
make it difficult to complete the transaction and, at a minimum, will
substantially increase the costs of the transaction to shareholders. The
Trustees believe that it would be in the best interests of shareholders to
permit the consummation of such a transaction without incurring the expenses
associated with holding a meeting of shareholders. Of course, in all cases
shareholders would receive notice prior to completion of the transaction.
If Proposal 3 is approved, the last sentence of Article IV, Section 4.2(d) of
the Trust Agreement would be amended as follows (material to be deleted is in
brackets [ ]; material to be added is underlined):
----------
The liquidation of any particular Sub-Trust may be authorized by vote of a
majority of the Trustees then in office without the approval of
-----------------------
shareholders of such Sub-Trust [subject to the approval of a majority of
------------------------------
the outstanding voting Shares of that Sub-Trust, as defined in the 1940
Act].
8
<PAGE>
In addition, Article VII, Section 7.2 of the Master Trust Agreement would be
deleted and replaced in its entirety with the following:
Section 7.2 Reorganization. The Trust, or any one or more Sub-Trusts, may,
--------------
either as the successor, survivor, or non-survivor, (1) consolidate or
merge with one or more other trusts, sub-trusts, partnerships, limited
liability companies, associations or corporations organized under the laws
of the Commonwealth of Massachusetts or any other state of the United
States, to form a consolidated or merged trust, sub-trusts, partnership,
limited liability company, association or corporation under the laws of
which any one of the constituent entities is organized, with the Trust to
be the survivor or non-survivor of such consolidation or merger or (2)
transfer a substantial portion of its assets to one or more other trusts,
sub-trusts, partnerships, limited liability companies, associations or
corporations organized under the laws of the Commonwealth of Massachusetts
or any other state of the United States, or have one or more such trusts,
sub-trusts, partnerships, limited liability companies, associations or
corporations transfer a substantial portion of its assets to it, any such
consolidation, merger or transfer to be upon such terms and conditions as
are specified in an agreement and plan of reorganization authorized and
approved by the Trustees and entered into by the Trust, or one or more Sub-
Trusts, as the case may be, in connection therewith. Any such
consolidation, merger or transfer may be authorized by vote of a majority
of the Trustees then in office without the approval of shareholders of any
Sub-Trust.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL OF PROPOSAL
3.
REQUIRED VOTE
Approval of the proposed amendment to the Trust Agreement is to be determined by
the vote of a majority of the outstanding shares of each Fund, with each Fund
voting as a separate class. If the proposed amendment is approved by fewer than
all Funds, the amendment will be effective with respect to those Funds that have
approved the Proposal.
PROPOSAL 4
AMENDMENT TO THE VOTING PROVISION OF THE TRUST AGREEMENT
VAN ECK WORLDWIDE INSURANCE TRUST
SHAREHOLDERS OF ALL FUNDS WILL VOTE ON PROPOSAL 4 WITH EACH FUND VOTING AS A
SEPARATE CLASS.
It is proposed that Article IV, Section 4.2(e) of the Trust Agreement be
amended. Section 4.2(e) provides that the Sub-Trusts (i.e., series) of the Trust
are required to vote as separate classes on any proposal that requires the vote
of a majority of the shareholders of the Trust. The effect of this provision is
to apply more stringent voting requirements on the Trust than those provided for
generally in Trust documents for other business Trusts organized under or as
required by Massachusetts law or the Act. Furthermore, under certain
circumstances, this provision may permit the shareholders of one Sub-Trust to
override the vote of the other Sub-Trusts with respect to matters that are
generally applicable to all Sub-Trusts.
The proposed amendment to the Trust Agreement would change this provision so
that, subject to certain exceptions, on each matter submitted to a vote of
shareholders of the Trust, all shareholders would vote as a single class, with
each shareholder being entitled to one vote for each whole share of the Trust.
Shareholders of a Sub-Trust would vote separately on any matter that affects
only that Sub-Trust. In addition, shareholders of each Sub-Trust would vote
separately to the extent required under
9
<PAGE>
the Act. For example, each Sub-Trust would vote as a separate class with respect
to the approval of any advisory agreement.
Section 4.2(e) of the Trust Agreement will be modified as described below.
Material to be deleted is in brackets [ ]; material to be added is underlined.
----------
(e) Voting. On each matter submitted to a vote of the Shareholders, each
------
holder of a Share of each Sub-Trust shall be entitled to one vote for each
whole Share and to a proportionate fractional vote for each fractional
Share standing in his name on the books of the Trust irrespective of the
-------------------
Sub-Trusts thereof and all Shares of [each] all Sub-Trusts shall vote [as a
------------------ ---
separate class except as to voting for Trustees and as otherwise required
by the 1940 Act. As to any matter which does not affect the interest of a
particular Sub-Trust, only the holders of Shares of the one or more
affected Sub-Trusts shall be entitled to vote.] together as a single class;
---------------------------
provided, however, that as to any matter (i) with respect to which a
--------------------------------------------------------------------
separate vote of one or more Sub-Trusts thereof is required by the 1940 Act
---------------------------------------------------------------------------
or the provisions of the writing or vote establishing and designating the
-------------------------------------------------------------------------
Sub-Trust, such requirements as to a separate vote by such Sub-Trust
--------------------------------------------------------------------
thereof shall apply in lieu of all Shares of all Sub-Trusts thereof voting
--------------------------------------------------------------------------
together; and (ii) as to any matter which affects the interests of one or
-------------------------------------------------------------------------
more particular Sub-Trust thereof, only the holders of Shares of the one or
---------------------------------------------------------------------------
more affected Sub-Trusts shall be entitled to vote, and each such Sub-Trust
---------------------------------------------------------------------------
shall vote as a separate class.
-------------------------------
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL OF PROPOSAL
4.
REQUIRED VOTE
Approval of the proposed amendment to the Trust Agreement is to be determined by
the vote of a majority of the outstanding shares of each Fund, with each Fund
voting as a separate class. If the proposed amendment is approved by fewer than
all Funds, the amendment will be effective with respect to those Funds that have
approved the Proposal.
PROPOSAL 5
AMENDMENT TO THE AMENDMENT PROVISION OF THE TRUST AGREEMENT
VAN ECK WORLDWIDE INSURANCE TRUST
SHAREHOLDERS OF ALL FUNDS WILL VOTE ON PROPOSAL 5 WITH EACH FUND VOTING AS A
SEPARATE CLASS.
It is proposed that Article VII, Section 7.3 of the Trust Agreement be amended.
Section 7.3 requires that any amendment to the Trust Agreement which adversely
affects the rights of any shareholder with respect to which such amendment is or
purports to be applicable and so long as such amendment is not in breach of
applicable law, including the 1940 Act, be authorized by a vote of a majority of
the outstanding voting securities entitled to vote. It is proposed that the
voting requirement be modified to require that such approval be authorized by a
majority of the outstanding securities as defined in the 1940 Act, which is the
lesser of (1) a majority of the outstanding shares of the Trust, or (2) 67% or
more of the shares of the Trust represented at the Special Meeting if more than
50% of the outstanding shares of the Trust are present or represented by proxy.
Important business matters come before the Trust affecting shareholders' rights,
thereby requiring a meeting. Often, because of shareholder apathy and the
failure to vote, important matters remain unresolved despite an overwhelming
positive response and/or the Trust must incur the expense of additional
solicitation to conclude the matter. The Trustees believe that this change to
the Trust
10
<PAGE>
Agreement will allow the Trust to transact important business without material
negative impact to shareholders' right to participate in governance of the
Trust.
If approved by shareholders, Article VII, Section 7.3 of the Trust Agreement
will be modified as described below. Material to be deleted is in brackets [ ];
material to be added is underlined.
----------
Section 7.3 Amendments. All rights granted to the Shareholders under this
----------
Declaration of Trust are granted subject to the reservation of the right to
amend this Declaration of Trust as herein provided, except that no
amendment shall repeal the limitations on personal liability of any
Shareholder or Trustee or repeal the prohibition of assessment upon the
Shareholders without the express consent of each Shareholder or Trustee
involved. Subject to the foregoing, the provisions of this Declaration of
Trust (whether or not related to the rights of Shareholders) may be amended
at any time, so long as such amendment does not adversely affect the rights
of any Shareholder with respect to which such amendment is or purports to
be applicable and so long as such amendment is not in contravention of
applicable law, including the 1940 Act, by an instrument in writing signed
by a majority of the then Trustees (or by an officer of the Trust pursuant
to the vote of a majority of such Trustees). Any amendment to this
Declaration of Trust that adversely affects the rights of Shareholders may
be adopted at any time by an instrument in writing signed by a majority of
the then Trustees (or by an officer of the Trust pursuant to a vote of a
majority of such Trustees) when authorized to do so by the vote in
accordance with subsection (e) of Section 4.2 of Shareholders holding a
majority of the outstanding voting securities [Shares] entitled to vote (as
----------------------------- --
defined in the 1940 Act). Subject to the foregoing, any such amendment
-----------------------
shall be effective as provided in the instrument containing the terms of
such amendment or, if there is no provision therein with respect to
effectiveness, upon the execution of such instrument and of a certificate
(which may be a part of such instrument) executed by a Trustee or officer
of the Trust to the effect that such amendment has been duly adopted.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR APPROVAL OF PROPOSAL
5.
REQUIRED VOTE
Approval of the proposed amendment to the Trust Agreement is to be determined by
the vote of a majority of the outstanding shares of each Fund, with each Fund
voting as a separate class. If the proposed amendment is approved by fewer than
all Funds, the amendment will be effective with respect to those Funds that have
approved the Proposal.
PROPOSAL 6
APPROVAL OF THE PROPOSED NEW INVESTMENT ADVISORY AGREEMENT
GOLD AND NATURAL RESOURCES FUND AND WORLDWIDE BOND FUND
ONLY SHAREHOLDERS OF GOLD AND NATURAL RESOURCES FUND AND WORLDWIDE BOND FUND
WILL VOTE FOR PROPOSAL 6 WITH EACH FUND VOTING AS A SEPARATE CLASS.
OVERVIEW
Van Eck Associates Corporation, 99 Park Avenue, New York, New York (the
"Adviser") acts as investment manager to the Gold and Natural Resources Fund
("GNRF") and Worldwide Bond Fund ("WBF") pursuant to an Investment Advisory
Agreement dated August 30, 1989 the terms of which were last approved by the
Board of Trustees with respect to each of GNRF and WBF on April 18, 1995 and
11
<PAGE>
by shareholders of GNRF on __________, 1990 and shareholders of WBF on ______,
1990 (each referred to as the "Current Agreement" or together as the "Current
Agreements").
Briefly, under the terms of the Current Agreements the Adviser provides
investment advisory services to the Funds. A copy of the Current Agreement is
attached as Exhibit A. Under the terms of the proposed new Investment Advisory
Agreement, the Adviser would provide investment advisory services as well as
accounting and administrative services to each Fund (each a "Proposed Agreement"
or together "Proposed Agreements"). The Proposed Agreements for GNRF and WBF are
identical to the investment advisory agreements and accounting and
administrative services agreements now in effect for the International Investors
Gold Fund and Gold/Resources Fund series of Van Eck Funds. See "Other Mutual
Funds Advised by the Adviser," under the caption "Additional Information" below.
Adoption of the Proposed Agreement will result in an increase in the fees for
investment advisory services. Under the Proposed Agreement the fee rate will be
as follows: 1.00% of net assets up to $500 million; .90% of net assets on the
next $250 million; .70% on net assets in excess of %750 million. (See
Description of "Proposed Agreement" below.)
Over the past several years, increased and intensified competition for qualified
personnel, development of new financial instruments and increased complexity of
the financial markets, and rapid changes in technology have driven up the costs
of mutual fund investment management, administration and servicing functions
significantly. The Adviser has identified a number of areas that have required
and in the future will require continued and increased capital expenditures. The
Adviser has been absorbing a large portion of the increased costs. In the
future, the resources of the Adviser available to meet the challenges may be
inadequate and, without an adequate return on capital and investment, the
Adviser may be unable or unwilling to continue to bear the costs or to make the
necessary capital investment, and/or may be unable to attract and retain
qualified personnel.
At a meeting held on July 18, 1995, the Board of Trustees considered the terms
of the Proposed Agreements, and the Board of Trustees, including a majority of
the "non-interested" Trustees (as contemplated by the Act), approved the terms
of the Proposed Agreements and their adoption subject to approval by
shareholders of the Proposed Agreements.
A copy of the Proposed Agreement is attached as Exhibit B. If the Proposed
Agreement is not approved by a Fund, the Current Agreement will remain in effect
for that Fund.
Set forth below is a description of the principal differences between the
Current Agreement and the Proposed Agreement as well as a description of those
provisions which are the same under both Agreements.
TRUSTEE CONSIDERATION
Managing funds like GNRF and WBF requires special skills and talents. The
increasing complexity of the securities markets (particularly the international
markets), the development of new international markets and opportunities that
did not exist a decade ago (i.e., emerging South American gold producers), the
availability of sophisticated hedging and investment techniques using new and
developing financial instruments, and the increased complexities and demands of
compliance all require the Adviser to be able to continue to attract and retain
high quality personnel and to make significant capital expenditures. Competition
for qualified personnel from large and highly capitalized foreign and domestic
companies has driven up the cost of attracting and retaining qualified personnel
dramatically.
Technology is playing a more important role in mutual fund servicing,
administration and portfolio
12
<PAGE>
management. Investing globally in today's financial markets requires
sophisticated portfolio information systems, accounting systems and data bases.
The development of analytical tools and new financial instruments offer the
potential to enhance returns and moderate risk. They, however, require
continuous analysis and special skills. Significant technological advancements
have increased the scope of services that are available. Although the costs of
hardware and software have declined, rapid developments require continual
investment in hardware and software to avoid obsolescence, and modern technology
requires a substantial investment in support personnel.
The importance, complexity and costs of effective compliance programs have
increased with developments in portfolio management strategies and techniques,
information and financial technology. Keeping pace with these developments and
increasingly complex regulation requires highly specialized skills and
experience.
The Board of Trustees has determined that the compensation to be paid to the
Adviser under the Proposed Agreement with respect to each Fund is fair and
reasonable. In approving the Proposed Agreement and recommending its approval by
shareholders, the Trustees, including the "non-interested" Trustees, considering
the best interests of shareholders of each Fund, took into account all such
factors they deemed relevant. The factors considered by the "non-interested"
Trustees and Trustees included: the nature, quality and extent of the services
furnished and to be furnished by the Adviser to each Fund; the necessity of the
Adviser maintaining and enhancing its ability to retain and attract capable
personnel to serve each Fund; the increased complexity of the domestic and
international securities markets; the investment record of the Adviser in
managing each Fund; benefits and costs of developing and evaluating quantitative
technologies and strategies and other analytical tools; the costs of developing
and maintaining increasingly complex compliance programs and hiring qualified
personnel; the Adviser's profitability with respect to each Fund and the other
investment companies managed by the Adviser before marketing expenses paid by
the Adviser and pro forma profitability data giving effect to the increase in
aggregate fees; the terms of the advisory and accounting and administrative
services agreements with respect to the other series of the Van Eck Worldwide
Insurance Trust and other investment companies for which the Adviser acts as
investment adviser; the effect of the increase in aggregate fees on the expense
ratio of each Fund; possible economies of scale; comparative data as to
investment performance, advisory/administration fees and expense ratios; the
risks assumed by the Adviser; the advantages and possible disadvantages to each
Fund of having an adviser which also serves other investment companies, as well
as other accounts; possible benefits to the Adviser from serving as adviser to,
and from an affiliate of the Adviser serving as principal underwriter of, each
Fund; current and developing conditions in the financial services industry,
including the entry into the industry of large and highly capitalized companies
which are spending and appear to be prepared to continue to spend substantial
sums to engage personnel and to provide services to competing investment
companies; the financial resources of the Adviser, the ability of the Adviser to
continue to provide quality services at competitive rates and the continuance of
appropriate incentives to assure that the Adviser will continue to furnish high
quality services; and various other factors.
DESCRIPTION OF PROPOSED AGREEMENT
The Proposed Agreement provides that the Adviser will act as investment adviser
to each Fund. The Adviser is required to furnish continuously an investment
program for each Fund and determine, subject to the overall supervision and
review of the Board of Trustees, which investments should be purchased, held,
sold or exchanged, and provide such executive and clerical personnel, office
space and equipment as are deemed necessary for managing the investments of each
Fund. The Adviser will pay the compensation of the Trust's officers, employees
and Trustees if such persons are also employees of the Adviser, except certain
accounting and legal personnel.
13
<PAGE>
The Proposed Agreement also provides that the Adviser will provide certain
accounting and administrative services to the Funds, office space, which may be
in the office space occupied by the Adviser, necessary office facilities, simple
business equipment, supplies, utilities and telephone service for administering
the affairs of the Fund.
As compensation for its services under the Proposed Agreement, the Adviser will
be paid a fee each month, based upon the average daily net asset value of each
Fund, at the annual rate of (i) 1.00% on the first $500 million of average net
assets of the Fund, (ii) 0.90% on the next $250 million of average net assets,
and (iii) 0.70% on the average net assets of the Fund in excess of $750 million.
Except for the expenses paid by the Adviser that are described above, each Fund
will bear all costs of its organization and operation, including but not limited
to, expenses of preparing, printing and mailing all shareholders' reports,
notices, prospectuses (except that the expense of printing and mailing
prospectuses used for promotional purposes will not be borne by the Fund), proxy
statements and reports to regulatory agencies; expenses relating to the
issuance, registration and qualification of shares of the Fund; government fees;
interest charges; expenses of furnishing account statements to shareholders;
taxes; expenses of redeeming shares; brokerage and other expenses connected with
the execution of portfolio securities transactions; fees and expenses of the
Fund's custodian; fees of the custodian or any agent for keeping books and
accounts and calculating the net asset value of Fund shares; fees and expenses
of independent accountants, legal counsel, transfer agent and dividend
disbursing agent; the compensation and expenses of its Trustees who are not
otherwise affiliated with the Fund, the Adviser, or any of their affiliates;
expenses of Trustees' and shareholders' meetings; trade and other association
memberships and meetings; insurance premiums; and any extraordinary expenses.
The principal differences between the Current Agreement and the Proposed
Agreement is that the annual fee payable under the Current Agreement is lower
and does not obligate the Adviser to provide accounting and administrative
services. Approval of the Proposed Agreement will have the effect, at current
asset levels, of increasing the aggregate fees for investment advisory and
administrative services by .25% average daily assets per year on assets not in
excess of $750 million and .20% on assets thereafter. Both the Current Agreement
and the Proposed Agreement require the Adviser to reimburse the Fund to the
extent total annual expenses, exclusive of interest, expenses, taxes and
extraordinary items exceed the lowest expense limitation imposed in any state in
which shares are sold. Currently, there are no such limitations. The foregoing
descriptions are qualified in their entirety by reference to the Proposed
Agreement provided as Exhibit X for this Proxy Statement.
If approved by shareholders of a Fund, the Proposed Agreement will become
effective for such Fund the day after it is approved by its shareholders and
will remain in force until April 30, 1996, and the Current Agreement with
respect to the Fund(s) approving the Proposed Agreement(s) will terminate. The
Proposed Agreement will continue in effect with respect to each Fund thereafter
by its terms from year to year only so long as its continuance is specifically
approved at least annually either by the Trustees or by a majority of the Fund's
outstanding shares (as defined in the Act), and in either event by the vote of a
majority of the non-interested Trustees cast in person at a meeting called for
the purpose of voting on such approval. The Proposed Agreement may be terminated
on 60 days' written notice, without penalty, by the Trustees, by the vote of the
shareholders of a majority of the Fund's outstanding voting securities, or by
the Adviser, and automatically terminates in the event of its assignment. The
Current Agreements require annual approval of its continuance and contain the
same termination provisions as the Proposed Agreement.
The following table compares actual fees and operating expenses (exclusive of
taxes) incurred under the Current Agreement with the fees and expenses that
would have been payable under the Proposed Agreement during the fiscal year
ended April 30, 1995 (unaudited):
14
<PAGE>
Current Proposed Other Total Total
Agreement Agreement Expenses Current Proposed Change
GNRF .75% 1.00% .21% .96% 1.21% .26%
WBF .75% 1.00% .23% .98% 1.23% .25%
For GNRF the ratio of total expenses (exclusive of taxes) to average net assets
for the fiscal year ended April 30, 1995 was .96% and if the Proposed Agreement
had been in effect such ratio would have been 1.21%. For WBF the ratio of total
expenses (exclusive of taxes) to average net assets for the same period was .98%
and if the Proposed Agreement had been in effect such ratio would have been
1.23%. At April 30, 1995, the net assets of GNRF were $127,319,689 and of WBF
were $113,465,916.
For the year ended April 30, 1995, the Adviser earned fees from WBF of $641,065
for investment management and advisory services. WBF also reimbursed the Adviser
$57,231 for costs incurred in connection with certain administrative and
accounting functions. For the year ended April 30, 1995, the Adviser earned fees
from GNRF of $837,780 for investment management and advisory services. GNRF also
reimbursed the Adviser $63,267 for costs incurred in connection with certain
administrative and accounting functions.
The Current Agreement with respect to each of GNRF and WBF will continue in
effect if the Proposed Agreement is not approved.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS OF GOLD AND NATURAL RESOURCES
FUND AND WORLDWIDE BOND FUND VOTE FOR APPROVAL OF PROPOSAL 6.
REQUIRED VOTE
Shareholders of GNRF and WBF will each vote as a separate class on Proposal 6.
Approval of the Proposed Agreement, with respect to a Fund, will require the
affirmative vote of a majority of the Fund's outstanding voting securities, as
defined in the Act, which for this purpose means (l) the holders of more than
50% of the outstanding shares of the Fund or (2) the holders of 67% or more of
the shares present if more than 50% of the outstanding shares are present at a
meeting in person or by proxy, whichever is less.
For additional information on Other Mutual Funds Advised by the Adviser and the
Distributor, please see "Additional Information" below.
ADDITIONAL INFORMATION
OTHER MUTUAL FUNDS ADVISED BY THE ADVISER
The Adviser presently acts as investment adviser, pursuant to written investment
management or investment advisory agreements, to the following mutual funds (Van
Eck Funds - net assets as of December 31, 1994; Van Eck Worldwide Insurance
Trust net assets as of April 30, 1995):
Van Eck Funds (Global Income Fund, with net assets of $137,643,280, World Trends
Fund, with net assets of $21,347,873; Asia Dynasty Fund, with net assets of
$118,810,961; Global Balanced Fund, with net assets of $19,614,004;
International Investors Gold Fund, with net assets of $635,237,767;
15
<PAGE>
Gold/Resources Fund, with net assets of $186,118,579; U.S. Government Money
Fund, with net assets of $47,078,207; Asia Infrastructure Fund, with net assets
of $1,050,313; Global SmallCap Fund, with net assets of $2,059,351; Global Hard
Assets Fund, with net assets of 1,427,160 (Gold Opportunity Fund commenced
operations on December 28, 1994) pays the Adviser an advisory fee for its
services with respect to each series, computed daily and paid monthly, at the
following annual rates: for the World Trends Fund, Global Income Fund,
International Investors Gold Fund and Gold/Resources Fund series .75 of 1% of
the first $500 million of average daily net assets, .65 of 1% of the next $250
million of average daily net assets and .50 of 1% of the average daily net
assets in excess of $750 million; U.S. Government Money Fund, .50 of 1% for the
first $500 million of average daily net assets, .40 of 1% on the next $250
million of average daily net assets, and .375 of 1% of the average daily net
assets in excess of $750 million; Asia Dynasty Fund, Global Balanced Fund,
Global SmallCap Fund and Asia Infrastructure Fund series .75 of 1% of average
daily net assets (and an Administrative fee of .25 of 1% of average daily net
assets); Global Hard Assets Fund and Gold Opportunity Fund 1.00% of average
daily net assets. Van Eck Worldwide Insurance Trust (Gold and Natural Resources
Fund, with net assets of $127,319,689, Worldwide Bond Fund, with net assets of
$113,465,916 and Worldwide Balanced Fund, with nets assets of $14,205) pays the
Adviser an advisory fee for its services with respect to each series computed
daily and paid monthly at the following annual rates: for Worldwide Bond Fund
and Gold and Natural Resources Fund .75 of 1% of the first $500 million of
average daily net assets, .65 of 1% of the next $250 million of average daily
net assets and .50 of 1% of average daily net assets in excess of $750 million;
and Worldwide Balanced Fund, .75 of 1% of average daily net assets (and an
administrative services fee of .25 of 1%).
The Adviser acts as sub-adviser, pursuant to written sub-advisory agreements, to
(net assets as of December 31, 1994): Thomson Investment Trust--Precious Metals
and Natural Resources Fund, with net assets of $62.9 million; GCG Trust (Natural
Resources Series), with net assets of $32.7 million; Chubb America Fund, Inc.-
Gold Stock Portfolio, with net assets of $7.4 million; and UBZ Gold Fund, with
net assets of $23.9 million.
Thomson Investment Trust-Precious Metals and Natural Resources Fund pays the
Adviser a sub-advisory fee for its services computed daily and paid monthly at
the following annual rates: .375 of 1% on the first $200 million of average
daily net assets, and .35 of 1% of average daily net assets in excess of $200
million.
GCG Trust-Natural Resources Series pays the Adviser an advisory fee for its
services computed daily and paid monthly at the following annual rates: .50 of
1% of average daily net assets.
Chubb America Fund-Gold Stock Portfolio pays the Adviser an advisory fee for its
services computed daily and paid monthly at the following annual rates: .50 of
1% on the first $200 million of average daily net assets, .45 of 1% in excess of
$200 million up to $1,300 million of average daily net assets, and .40 of 1% in
excess of $1,300 million of average daily net assets.
UBZ Gold Fund pays the Adviser .50 of 1% calculated on calendar quarter net
assets and the fee is paid annually.
THE DISTRIBUTOR
Van Eck Securities Corporation (the "Distributor"), 99 Park Avenue, New York,
New York, a wholly owned subsidiary of the Adviser and the present distributor
for the Funds. The Board of Trustees of the Trust, including a majority of the
Trustees who are not parties to the agreement or interested persons of the Trust
or the Distributor, at a meeting held for such purpose on April 18, 1995, has
approved the distribution agreement with Van Eck Securities Corporation.
16
<PAGE>
The Distributor will not participate in brokerage commissions paid by GNRF or
WBF to other brokers or dealers, will not knowingly receive any reciprocal
business directly or indirectly as a result of such commissions and has not
received any brokerage commissions directly from the GNRF, WBF or the Trust.
OFFICERS OF THE TRUST
The following table sets forth a list of the Trust's officers (other than John
C. van Eck who is included in the list of Trustees in Proposal 1 above),
together with their ages, positions with the Trust and certain other
information. All officers serve at the pleasure of the Board of Trustees.
Name Age Position With Trust and Business Experience
- - - ---- --- -------------------------------------------
Henry J. Bingham 64 Executive Vice President of the Trust,
President, International Investors Gold Fund
series of Van Eck Funds; Executive Vice
President of other affiliated investment
companies advised by the Adviser; Executive
Managing Director of the Adviser. Formerly an
officer of the Adviser and affiliated
companies; Director and Vice President (1978-
1983), United Services Gold Shares, Inc.,
United Services Group of Funds, Inc. and The
Good and Bad Times Fund, Inc. (mutual funds)
and Growth Research and Management, Inc.
(investment adviser). Formerly General
Partner and Director of Spencer Trask & Co.
Madis Senner 41 Executive Vice President of the Trust,
President, Worldwide Bond Fund series of the
Trust; Director, Global Fixed Income of the
Adviser; Executive Vice President of other
affiliated investment companies of the
Adviser; President of Global Income Fund
series of Van Eck Funds; Former Global Bond
Manager, Chase Manahattan Private Bank (1992-
1994); Former President and founder, Sunray
Securities, Inc. (1989-1992).
Kevin Reid 32 Vice President, Worldwide Hard Assets Fund
series of the Trust; Director, Real Estate
Research of the Adviser; Vice President of
Global Hard Assets Fund series of Van Eck
Funds; Former Chief Financial Officer of E.P.
Reid, Inc. (1993-1994); Former Vice President
and Portfolio Manager of Trammell Crow
Company (1988-1993).
Derek van Eck***@ 30 President of Global Hard Assets Fund and
World Trends Fund and Vice President of
Global Balanced Fund, Asia Infrastructure
Fund, Global SmallCap Fund and Gold
Opportunity Fund series of Van Eck Funds;
Executive Vice President, Director of Global
Investments; Director of Van Eck Associates
Corporation and Van Eck Securities
Corporation.
17
<PAGE>
Michael G. Doorley 39 Vice President of the Trust, Senior Vice
President and Chief Financial Officer of Van
Eck Associates Corporation and Van Eck
Securities Corporation, Senior Vice President
and Chief Financial Officer of other
affiliated investment companies advised by
the Adviser; Formerly an officer of the
Adviser and its affiliated companies.
Bruce J. Smith 40 Vice President and Treasurer of the Trust,
Senior Managing Director, Portfolio
Accounting of the Adviser and Senior Managing
Director of the Distributor. Vice President
and Treasurer of other affiliated investment
companies advised by the Adviser; Formerly an
officer of the Adviser and its affiliated
companies.
Joseph DiMaggio 38 Controller of the Trust.
Thaddeus M. Leszczynski 48 Vice President and Secretary of the Trust,
Vice President and Secretary of other
affiliated investment companies advised by
the Adviser; Vice President, Secretary and
General Counsel of the Adviser and
Distributor; Formerly an officer of the
Adviser and its affiliated companies.
__________
@ An "interested person" as defined in the Act.
*** Son of John C. van Eck and nephew of Fred M. van Eck.
DIRECTORS AND OFFICERS OF THE ADVISER, DISTRIBUTOR AND THE TRUST
<TABLE>
<CAPTION>
Position with Van Eck Position with Van Eck
Name Position with Trust Associates Corporation Securities Corporation
- - - ---- ------------------- ---------------------- ----------------------
<S> <C> <C> <C>
John C. van Eck Chairman of Board Chairman of Board Chairman of Board
and President
Rodger A. Lawson President, Chief President, Chief
Executive Officer Executive Officer
and Director and Director
Fred M. van Eck -- Director Director
Sigrid S. van Eck -- Director, Vice President & Director, Vice
Assistant Treasurer President &
Asst. Treasurer
Derek S. van Eck Executive Vice Director, Executive Vice Director
President President, Director -
Global Investments
</TABLE>
18
<PAGE>
<TABLE>
<S> <C> <C> <C>
Jan F. van Eck -- Director Director, Executive
Vice President
Henry J. Bingham Executive Vice Executive Managing --
President Director
Lucille Palermo -- Associate Director, --
Mining Research
William A. Trebilcock -- Director, Mining Research --
Madis Senner Executive Vice Director, Global Fixed --
President Income
Myles London -- Director, Quantitative --
Research
Kevin Reid -- Director, Real Estate --
Research
Charles Cameron -- Director, Trading --
Michael G. Doorley Vice President Sr. Vice President, Sr. Vice President,
Treasurer, Controller & Treasurer, Controller &
Chief Financial Officer Chief Financial Officer
Paul DiPerna Asst. Vice President Associate Manager, Trading --
Bruce J. Smith Vice President & Senior Managing Director, Senior Managing
Treasurer Portfolio Accounting Director, Portfolio
Accounting
Joseph DiMaggio Controller -- --
Stephen Ilnitzki -- Chief Operating Officer Chief Operating
Officer
Susan C. Lashley Vice President -- Managing Director,
Operations
Thaddeus Leszczynski Vice President & Vice President, General Vice President, General
Secretary Counsel & Secretary Counsel & Secretary
Keith Fletcher -- Sr. Managing Director
Edward Wilson -- -- Sr. Managing Director
Thomas Keffer -- -- Sr. Managing Director
David Pinto -- -- Sr. Managing Director
Karen Schwaneberg -- Director, Information --
Services
</TABLE>
19
<PAGE>
OTHER MATTERS
The Trust is not aware of any other matters to come before the Special Meeting
other than the matters described above. However, inasmuch as matters of which
the management is not now aware may come before the Special Meeting, the persons
named as proxies will vote in accordance with their best judgement with respect
to such matters.
By order of the Board of Trustees,
THADDEUS LESZCZYNSKI,
Secretary
20
<PAGE>
EXHIBIT A
ADVISORY AGREEMENT
AGREEMENT made as of the 3Oth day of August, 1989 between
VAN ECK ASSOCIATES CORPORATION, a corporation organized under the
laws of the State of Delaware and having its principal place of
business in New York, New York (the "Advisor"), and VAN ECK
INVESTMENT TRUST, a Massachusetts business trust having its
principal place of business in New York, New York (the "Trust").
WHEREAS, the Trust is engaged in business as an open-end
management investment company and is so registered under the
Investment Company Act of 1940 (the "1940 Act"); and
WHEREAS, the Advisor is engaged principally in the business
of rendering investment management services and is so registered
under the Investment Advisers Act of 1940; and
WHEREAS, the Trust is authorized to issue shares of
beneficial interest in separate series with each such series
representing interests in a separate portfolio of securities and
other assets; and
WHEREAS, the Trust intends to initially offer shares in two
series, Gold and Natural Resources Fund and Worldwide Bond Fund,
[such series (being referred to herein as the "Initial Funds")
together with all other series subsequently established by the
Trust with respect to which the Trust desires to retain the
Advisor to render investment advisory services hereunder and with
respect to which the Advisor is willing so to do, being herein
collectively referred to as the "Funds"];
NOW, THEREFORE, WITNESSETH: That it is hereby agreed
between the parties hereto as follows:
1. APPOINTMENT OF ADVISOR.
(a) Initial Funds. The Trust hereby appoints the
Advisor to act as manager and investment adviser to
the Initial Funds for the period and on the terms
herein set forth. The Advisor accepts such
appointment and agrees to render the services
herein set forth, for the compensation herein
provided.
(b) Additional Funds. In the event that the Trust
establishes one or more series of shares other than
the Initial Funds with respect to which it desires
to retain the Advisor to render management and
investment advisory services hereunder, it shall so
notify the Advisor in writing, indicating the
21
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advisory fee which will be payable with respect to
the additional series of shares. If the Advisor is
willing to render such services, it shall so notify
the Trust in writing, whereupon such series of
shares shall become a Fund hereunder.
2. DUTIES OF ADVISOR.
The Advisor, at its own expense, shall furnish the following
services and facilities to the Trust:
(a) Investment Program. The Advisor will (i) furnish
continuously an investment program for each Fund,
(ii) determine (subject to the overall supervision
and review of the Board of Trustees of the Trust)
what investments shall be purchased, held, sold or
exchanged by each Fund and what portion, if any, of
the assets of each Fund shall be held uninvested,
and (iii) make changes on behalf of the Trust in
the investments of each Fund. The Advisor also
will manage, supervise and conduct such other
affairs and business of the Trust and each Fund
thereof and matters incidental thereto, as the
Advisor and the Trust agree, subject always to the
control of the Board of Trustees of the Trust and
to the provisions of the Master Trust Agreement,
By-laws and the 1940 Act.
(b) Office Space and Facilities. The Advisor will
arrange to furnish the Trust office space in the
offices of the Advisor, or in such other place or
places as may be agreed upon from time to time, and
all necessary office facilities, simple business
equipment, supplies, utilities, and telephone
service for managing the affairs and investments of
the Trust. These services are exclusive of the
necessary services and records of any dividend
disbursing agent, transfer agent, registrar or
custodian, and accounting and bookkeeping services
which may be provided by the custodian.
(c) Personnel. The Advisor shall provide executive
and clerical personnel for administering the
affairs of the Trust, and shall compensate Officers
and Trustees of the Trust if such persons are
also employees of the Advisor or its affiliates,
except as provided in Paragraphs 3(f), 3(j), 3(k)
and 3(m) hereof.
(d) Portfolio Transactions. The Advisor shall place
all orders for the purchase and sale of portfolio
securities for the account of each Fund with
brokers or dealers selected by the Advisor,
although the Trust will pay the actual brokerage
commissions on portfolio transactions in accordance
with Paragraph 3(c). In executing portfolio
22
<PAGE>
transactions and selecting brokers or dealers, the
Advisor will use its best efforts to seek on behalf
of the Trust or any Fund thereof the best overall
terms available. In assessing the best overall
terms available for any transaction, the Advisor
shall consider all factors it deems relevant,
including, without limitation, the breadth of the
market in the security, the price of the security,
the financial condition and execution capability of
the broker or dealer, and the reasonableness of the
commission, if any (for the specific transaction
and on a continuing basis). In evaluating the best
overall terms available, and in selecting the
broker or dealer to execute a particular
transaction, the Advisor may also consider the
brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange
Act of 1934) provided to any Fund and/or other
accounts over which the Advisor or an affiliate of
the Advisor exercises investment discretion. The
Advisor is authorized to pay to a broker or dealer
who provides such brokerage and research services a
commission for executing a portfolio transaction
for any Fund which is in excess of the amount of
commission another broker or dealer would have
charged for effecting that transaction if the
Advisor determines in good faith that such
commission was reasonable in relation to the value
of the brokerage and research services provided by
such broker or dealer, viewed in terms of that
particular transaction or in terms of all of the
accounts over which investment discretion is so
exercised by the Advisor or its affiliates.
Nothing in this Agreement shall preclude the
combining of orders for the sale or purchase of
securities or other investments with other accounts
managed by the Advisor or its affiliates provided
that the Advisor does not favor any account over
any other account and provided that and purchase or
sale orders executed contemporaneously shall be
allocated in a manner the Advisor deems equitable
among the accounts involved. Consistent with the
Rules of Fair Practice of the National Association
of Securities Dealers, Inc. and subject to seeking
the most favorable price and execution available
and such other policies as the Board of Trustees of
the Trust may determine, the Advisor may consider
sales of shares of a Fund as a factor in the
selection of broker-dealers to execute portfolio
transactions for a Fund.
(e) Regulatory Reports. The Adviser shall furnish to
the Trust necessary assistance in:
(i) the preparation of all reports now or hereafter
required by federal or other laws; and
23
<PAGE>
(ii) the preparation of prospectuses, registration
statements and amendments thereto that may be
required by federal or other laws or by the rules
or regulations of any duly authorized commission or
administrative body.
(f) Fidelity Bond. The Adviser shall arrange for
providing and maintaining a bond issued by a
reputable insurance company authorized to do
business in the place where the bond is issued
against larceny and embezzlement covering each
officer and employee of the Trust, the Adviser
and/or any sub-adviser who may singularly or
jointly with others have access to funds or
securities of the Trust, with direct or indirect
authority to draw upon such funds or to direct
generally the disposition of such funds. The bond
shall be in such reasonable amount as a majority of
the Trustees who are not "interested persons" of
the Trust, as defined in the 1940 Act, shall
determine, with due consideration to the aggregate
assets of the Trust to which any such officer or
employee may have access. The premium, or portion
thereof pursuant to an agreement among the insured
parties in the case of a joint accordance with
paragraph 3(n).
3. ALLOCATION OF EXPENSES.
Except for the services and facilities to be provided by the
Advisor as set forth in Paragraph 2 above, the Trust assumes and
shall pay all expenses for all other Trust operations and
activities and shall reimburse the Advisor for any such expenses
incurred by the Advisor. The expenses to be borne by the Trust
shall include, without limitation:
(a) The charges and expenses of any registrar, stock
transfer or dividend disbursing agent, custodian,
depository or other agent appointed by the Trust
for the safekeeping of its cash, portfolio
securities and other property;
(b) the charges and expenses of auditors and outside
accountants;
(c) brokerage commissions for transactions in the
portfolio securities of the Trust:
(d) all taxes, including issuance and transfer taxes,
and corporate fees payable by the Trust to Federal,
state or other U.S. or foreign governmental
agencies;
(e) the cost of stock certificates representing shares
of the Trust;
(f) expenses involved in registering and maintaining
registrations of the Trust and of its shares with
the Securities and Exchange Commission and various
24
<PAGE>
states and other jurisdictions, if applicable,
including reimbursement of actual expenses incurred
by the Advisor in performing such functions for the
Trust, and including compensation of persons who
are Advisor employees in proportion to the relative
time spent on such matters;
(g) all expenses of shareholders' and Trustees'
meetings, including meetings of committees, and of
preparing, setting in type, printing and mailing
proxy statements, quarterly reports, semi-annual
reports, annual reports and other communications to
shareholders;
(h) all expenses of preparing and setting in type
prospectuses, and expenses of printing and mailing
the same to shareholders (but not expenses of
printing and mailing of prospectuses and literature
used for promotional purposes);
(i) compensation and travel expenses of Trustees who
are not "interested persons" of the Advisor within
the meaning of the 1940 Act;
(j) the expense of furnishing, or causing to be
furnished, to each shareholder statements of his
account, including the expense of mailing, and any
charges and expenses for services performed by the
Advisor or by Van Eck Securities Corporation in
connection with servicing shareholder accounts,
including accounting and bookkeeping services not
otherwise provided by a custodian or dividend and
transfer agent;
(k) charges and expenses of legal counsel in connection
with matters relating to the Trust, including,
without limitation, legal services rendered in
connection with the Trust's corporate and financial
structure, day to day legal affairs of the Trust
and relations with its shareholders, issuance of
Trust shares, and registration and qualification of
securities under Federal, state and other laws;
(l) the expenses of attendance at professional meetings
of organizations such as the Investment Company
Institute by officers and Trustees of the Trust,
and the membership or association dues of such
organizations;
(m) Upon the net assets of a Fund exceeding S10
million, the cost and expense of maintaining the
books and records of the Trust, including general
ledger and daily net asset value accounting,
25
<PAGE>
including compensation of persons who are Advisor
employees in proportion to the relative time spent
on such matters;
(n) the expense of obtaining and maintaining a fidelity
bond as required by Section 17(g) of the 1940 Act
and the expense of obtaining and maintaining an
errors and omissions policy;
(o) interest payable on Trust borrowings;
(p) postage; and
(q) any other costs and expenses incurred by the
Advisor for Trust operations and activities,
including but not limited to the organizational
costs of a Fund which will initially be paid by the
Advisor and reimbursed by the Trust to the Advisor.
4. ADVISORY FEE.
(a) For the services and facilities to be provided to
each of the Funds by the Advisor as provided in
Paragraph 2 hereof, the Trust shall pay the Advisor
a fee payable monthly with respect to each of the
Funds, which fee shall be paid at the annual rate
set forth in the advisory fee schedule below as
amended from time to time to reflect changes with
respect to the establishment of new Funds. The Fee
is based upon the daily average net assets of a
Fund, determined in accordance with procedures
established from time to time by or under the
direction of the Board of Trustees of the Trust:
ADVISORY FEE SCHEDULE
Daily Average Annual
Net Assets Fee Rate
Up-to and including $500 million .75%
Over $500 million up to and
including $750 million .65%
Over $750 million .50%
5. EXPENSE LIMITATION
The Adviser agrees that if the total expenses of any Fund
26
<PAGE>
(exclusive of interest, taxes, brokerage expenses, distribution
expenses, extraordinary items and any other items allowed to be
excluded by applicable state law) for any fiscal year of the
Trust exceed the lowest expense limitation imposed in any
jurisdiction in which that Fund is then qualified for sale, the
Adviser will pay or reimburse such Fund for that excess up to the
amount of its advisory fee payable with respect to that Fund
during that fiscal year. The amount of the monthly advisory fee
payable under Paragraph 4 hereof shall be reduced to the extent
that the monthly expenses of that Fund, on an annualized basis,
would exceed the foregoing limitation. At the end of each fiscal
year of the Trust, if the aggregate annual expenses chargeable to
any Fund for that year exceed the foregoing limitation based upon
the average of the monthly average net asset value of that Fund
for the year, the Adviser will promptly reimburse that Fund for
the amount of such excess to the extent not already reimbursed by
reduction of the monthly advisory fee, but if such expenses are
within the foregoing limitation, any excess amount previously
withheld from the advisory fee during that fiscal year will be
promptly paid over to the Adviser.
6. TRUST TRANSACTIONS.
The Advisor agrees that neither it nor any of its officers,
directors, employees or agents will take any long or short term
position in the shares of the Trust; provided, however, that such
prohibition shall not prevent the purchase of shares of the Trust
by any of the persons above described for their account and for
investment at the price (net asset value) at which such shares
are available to the public at the time of purchase or as part of
the initial capital of the Funds.
7. RELATIONS WITH TRUST.
Subject to and in accordance with the Master Trust Agreement and
By-laws of the Trust and the Articles of Incorporation and
By-laws of the Advisor, respectively, it is understood (i) that
Trustees, officers, agents and shareholders of the Trust are or
may be interested in the Advisor (or any successor thereof) as
directors, officers, or otherwise; (ii) that directors, officers,
agents and shareholders of the Advisor are or may be interested
in the Trust as Trustees, officers, shareholders, or otherwise;
and (iii) that the Advisor (or any such successor) is or may be
interested in the Trust as a shareholder or otherwise and that
the effect of any such adverse interests shall be governed by
said Master Trust Agreement, Articles of Incorporation and
By-laws.
27
<PAGE>
8. LIABILITY OF ADVISOR AND OFFICERS AND TRUSTEES OF THE TRUST.
Neither the Advisor nor its officers, directors, employees,
agents or controlling persons or assigns shall be liable for any
error or judgment or law, or for any loss suffered by the Trust
or its shareholders in connection with the matters to which this
Agreement relates, except that no provision of this Agreement
shall be deemed to protect the Advisor or such persons against
any liability to the Trust or its shareholders to which the
Advisor might otherwise be subject by reason of any willful
misfeasance, bad faith or gross negligence in the performance of
its duties or the reckless disregard of its obligations and
duties under this Agreement.
9. DURATION AND TERMINATION OF THIS AGREEMENT.
(a) Duration. This Agreement shall become effective
with respect to the Initial Funds on the date
hereof and, with respect to any additional Fund, on
the date of receipt by the Trust of notice from the
Advisor in accordance with paragraph l(b) hereof
that the Advisor is willing to serve as Advisor
with respect to such Fund. Unless terminated as
herein provided, this Agreement shall remain in
full force and effect until April 30, 1991 with
respect to the Initial Funds and shall continue in
full force and effect for periods of one year
thereafter with respect to each Fund so long as
such continuance with respect to any such Fund is
approved at least annually (i) by either the
Trustees of the Trust or by vote of a majority of
the outstanding voting shares (as defined in the
1940 Act) of such Fund, and (ii) in either event by
the vote of a majority of the Trustees of the Trust
who are not parties to this Agreement or
"interested persons" (as defined in the 1940 Act)
of any such party, cast in person at a meeting
called for the purpose of voting on such approval.
Any approval, amendment or termination of this
Agreement by the holders of a majority of the
outstanding shares (as defined in the 1940 Act) of
any Fund shall be effective with respect to any
such Fund notwithstanding (i) that such action has
not been taken by the holders of a majority of the
outstanding shares of any other Fund affected
thereby, and (ii) that such action has not been
taken by the vote of a majority of the outstanding
shares of the Trust, unless such action shall be
required by any other applicable law or otherwise.
28
<PAGE>
(b) Termination. This Agreement may be terminated at
any time, without payment of any penalty, by vote
of the Trustees of the Trust or by vote of a
majority of the outstanding shares (as defined in
the 1940 Act), or by the Advisor on sixty (60) days
written notice to the other party.
(c) Automatic Termination. This Agreement shall
automatically and immediately terminate in the
event of its assignment.
10. NAME OF TRUST.
It is understood that the name "Van Eck" is the valuable property
of Van Eck Associates Corporation, and that the Trust has the
right to include "Van Eck" as a part of its name only so long as
this Agreement shall continue. Upon termination of this
Agreement the Trust shall forthwith cease to use the "Van Eck"
name and shall submit to its shareholders an amendment to its
Declaration of Trust to change the Trust's name.
11. PRIOR AGREEMENT SUPERSEDED.
This Agreement supersedes any prior agreement relating to the
subject matter hereof between the parties.
12. SERVICES NOT EXCLUSIVE.
The services of the Advisor to the Trust hereunder are not to be
deemed exclusive, and the Advisor shall be free to render similar
services to others so long as its services hereunder are not
impaired thereby.
13. MISCELLANEOUS.
(a) This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
(b) If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall
not be affected thereby.
14. LIMITATION OF LIABILITY.
The term "Van Eck Investment Trust" means and refers to the
29
<PAGE>
Trustees from time to time serving under the Declaration of Trust
of the Trust dated January 7, 1987, 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 Trust, as provided
in the Declaration of Trust of the Trust. The execution and
delivery of this Agreement have been authorized by the Trustees
and shareholders of the Trust and signed by an authorized officer
of the Trust, acting as such, and neither such authorization by
such Trustees and shareholders nor such execution and delivery by
such officer shall be deemed to have been made by any of them
individually or to impose any liability on any of them
personally, but shall bind only the assets and property of the
Trust as provided in its Declaration of Trust.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first set forth above.
VAN ECK INVESTMENT TRUST VAN ECK ASSOCIATES CORPORATION
By _____________________ By _______________________
President President
Attest: Attest:
________________________ _________________________
30
<PAGE>
EXHIBIT B [FORM OF]
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made as of the ____ day of ________, 1995 between VAN ECK
ASSOCIATES CORPORATION, a corporation organized under the laws of the
State of Delaware and having its principal place of business in New
York, New York (the "Advisor"), and VAN ECK WORLDWIDE INSURANCE
TRUST,a Massachusetts Business trust having its principal place of
business in New York, New York (the "Trust").
WHEREAS, the Trust is engaged in business as an open-end investment
company and is so registered under the Investment Company Act of 1940
(the "1940 Act"); and
WHEREAS, the Advisor is engaged principally in the business of
rendering investment management services and is registered under the
Investment Advisers Act of 1940; and
WHEREAS, the Trust is authorized to issue shares of beneficial
interest with each series; and in separate series representing
interests in a separate portfolio of securities and other assets:
WHEREAS, the Trust intends to offer its shares in one or more such
series, as listed in Exhibit A hereto (each a "Fund"), and invest the
proceeds in securities, the Trust desires to retain the Advisor to
render investment advisory and accounting and administrative services
hereunder and with respect to which the Advisor is willing so to do;
NOW, THEREFORE, WITNESSETH: That it is hereby agreed between the
parties hereto as follows:
1. APPOINTMENT OF ADVISOR.
The Trust hereby appoints the Advisor to act as investment advisor and
administrator to the Fund for the period and on the terms herein set
forth. The Advisor accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.
2. DUTIES OF ADVISOR.
The Advisor, at its own expense, shall furnish the following services
and facilities to the Trust:
(a) Investment Program.
The Advisor will (i) furnish continuously an investment program for
the Fund (ii) determine (subject to the overall supervision and review
31
<PAGE>
of the Board of Trustees of the Trust) what investments shall be
purchased, held, sold or exchanged and what portion, if any, of the
assets of the Trust shall be held uninvested, and (iii) make changes
on behalf of the Trust in the investments. The Advisor also will
manage, supervise and conduct such other affairs and business of the
Trust and matters incidental thereto, as the Advisor and the Trust
agree, subject always to the control of the Board of Trustees of the
Trust and to the provisions of the Master Trust Agreement of the
Trust, the Trust's By-laws and the 1940 Act.
(b) Accounting and Administrative Services
(i) The Advisor, at its own expense, will perform the following
accounting functions on an ongoing basis:
(1) Journalize the Fund's investment, capital share and income
and expense activities;
(2) Verify investment buy/sell trade tickets when received from
the Fund and transmit trades to the Trust's custodian for
proper settlement;
(3) Maintain individual ledgers for investment securities;
(4) Reconcile cash and investment balances with the Trust's
custodian, and provide the Fund with the beginning cash
balance available for investment purposes;
(5) Update the cash availability throughout the day as required
by the Fund;
(6) Post to and prepare the Fund's Statement of Assets and
Liabilities and the Statement of Operations;
(7) Calculate various contractual expenses (e.g., transfer
agency fees);
(8) Control all disbursements and authorize such disbursements
upon written instructions from authorized officers and
agents;
(9) Calculate capital gains and losses;
(10) Determine the net income;
(11) Obtain security market quotes, at the Fund's expense, or if
such quotes are unavailable, obtain such prices from the
investment advisor, and in either case calculate the market
value of the Fund's investments;
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<PAGE>
(12) Deliver a copy of the daily portfolio valuation to the Fund;
(13) Compute the net asset value;
(14) Compute the Fund's yields, total return, expense ratios,
portfolio turnover rate;
(15) Monitor the expense accruals and notify the Fund of any
proposed adjustments; and
(16) Prepare periodic unaudited financial statements.
(ii) In addition to the accounting services described in the foregoing
Paragraph 2(b)(i), the Advisor will provide or arrange for the
following services for each Fund:
(1) Prepare periodic audited financial statements;
(2) Supply various statistical data as requested by the Board of
Trustees of the Trust on an ongoing basis;
(3) Prepare for execution and file the Federal and state tax
returns;
(4) Prepare and file the Semi-Annual Reports with the SEC on
Form N-SAR;
(5) Prepare and file with the Securities and Exchange Commission
the Trust's annual, semi-annual, and quarterly shareholder
reports;
(6) File registration statements on form N-1A and other filings
relating to the registration of Shares;
(7) Monitor the Initial Series' status as a regulated investment
company under Sub-Chapter M of the Internal Revenue Code of
1986, as amended;
(8) Maintain the Initial Series' fidelity bond as required by
the 1940 Act;
(9) Prepare materials for and record the proceedings of, in
conjunction with the officers of the Trust, the meetings of
the Trust's Board of Trustees; and
(10) Prepare any other regulatory reports to and for any federal,
local or state agency as may be required.
In carrying out its duties hereunder, as well as any other activities
undertaken on behalf of the Fund pursuant to this Agreement, the
Advisor shall at all times be subject to the control and direction of
the Board of Trustees of the Trust.
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<PAGE>
(c) Office Space and Facilities.
---------------------------
The Advisor will arrange to furnish the Trust office space in the
offices of the Advisor, or in such other place or places as may be
agreed upon from time to time, and all necessary office facilities,
simple business equipment, supplies, utilities, and telephone service
required for managing the investments of the Trust.
(d) Personnel.
---------
The Advisor shall provide executive and clerical personnel for
managing the investments of the Trust, and shall compensate officers
and Trustees of the Trust if such persons are also employees of the
Advisor or its affiliates, except as otherwise provided herein.
(e) Portfolio Transactions.
----------------------
The Advisor shall place all orders for the purchase and sale of
portfolio securities for the account of the Trust with brokers or
dealers selected by the Advisor, although the Trust will pay the
actual brokerage commissions on portfolio transactions in accordance
with Paragraph 3(d). In executing portfolio transactions and
selecting brokers or dealers, the Advisor will use its best efforts to
seek on behalf of the Trust the best overall terms available. In
assessing the best overall terms available for any transaction, the
Advisor shall consider all factors it deems relevant, including,
without limitation, the breadth of the market in the security, the
price of the security, the financial condition and execution
capability of the broker or dealer, and the reasonableness of the
commission, if any (for the specific transaction and on a continuing
basis). In evaluating the best overall terms available, and in
selecting the broker or dealer to execute a particular transaction,
the Advisor may also consider the brokerage and research services (as
those terms are defined in Section 28(e) of the Securities Exchange
Act of 1934) provided to the Trust and/or the other accounts over
which the Advisor or an affiliate of the Advisor exercises investment
discretion. The Advisor is authorized to pay to a broker or dealer
who provides such brokerage and research services a commission for
executing a portfolio transaction which is in excess of the amount of
commission another broker or dealer would have charged for effecting
that transaction if the Advisor determines in good faith that such
commission was reasonable in relation to the value of the brokerage
and research services provided by such broker or dealer, viewed in
terms of that particular transaction or in terms of all of the
accounts over which investment discretion is so exercised by the
Advisor or its affiliates. Nothing in this Agreement shall preclude
the combining of orders for the sale or purchase of securities or
other investments with other accounts managed by the Advisor or its
affiliates provided that the Advisor does not favor any account over
any other account and provided that any purchase or sale orders
executed contemporaneously shall be allocated in a manner the Advisor
deems equitable among the accounts involved.
34
<PAGE>
(f) Right to Receive Advice.
-----------------------
(i) Advice of Initial Series. If the Advisor shall be in doubt as to
------------------------
any action to be taken or omitted by it, it may request, and
shall receive, from the Initial Series directions or advice.
(ii) Advice of Counsel. If the Advisor or the Initial Series shall be
-----------------
in doubt as to any question of law involved in any action to be
taken or omitted by the Advisor, it may request advice at the
Initial Series' cost from counsel of its own choosing (who may be
counsel for the Advisor or the Initial Series, at the option of
the Advisor).
(iii) Protection of the Advisor. The Advisor shall be protected
-------------------------
in any action or inaction which it takes in reliance on any
directions or advice received pursuant to subsections (i) or
(ii) of this paragraph which the Advisor, after receipt of
any such directions or advice in good faith believes to be
consistent with such directions or advice as the case may
be. However, nothing in this paragraph shall be construed as
imposing upon the Advisor any obligation (i) to seek such
directions, or advice or (ii) to act in accordance with such
directions or advice when received. Nothing in this
subsection shall excuse the Advisor when an action or
omission on the part of the Advisor constitutes willful
misfeasance, bad faith, gross negligence or reckless
disregard by the Advisor of its duties under this Agreement.
3. EXPENSES OF THE TRUST
The Advisor shall not bear the responsibility for or expenses
associated with operational, accounting or administrative services on
behalf of the Trust not expressly assumed by the Advisor hereunder.
The expenses to be borne by the Trust include, without limitation:
(a) charges and expenses of any registrar, stock, transfer or
dividend disbursing agent, custodian, depository or other
agent appointed by the Trust for the safekeeping of its
cash, portfolio securities and other property;
(b) general operational, administrative and accounting costs,
such as the costs of calculating the Trust's net asset
value, the preparation of the Trust's tax filings with
relevant authorities and of compliance with any and all
regulatory authorities;
(c) charges and expenses of auditors and outside accountants;
(d) brokerage commissions for transactions in the portfolio
35
<PAGE>
securities of the Trust;
(e) all taxes, including issuance and transfer taxes, and
corporate fees payable by the Trust to Federal, state or
other U.S. or foreign governmental agencies;
(f) the cost of stock certificates representing shares of the
Trust;
(g) expenses involved in registering and maintaining
registrations of the Trust and of its shares with the
Securities and Exchange Commission and various states and
other jurisdictions, if applicable;
(h) all expenses of shareholders' and Trustees' meetings,
including meetings of committees, and of preparing, setting
in type, printing and mailing proxy statements, quarterly
reports, semi-annual reports, annual reports and other
communications to shareholders;
(i) all expenses of preparing and setting in type offering
documents, and expenses of printing and mailing the same to
shareholders (but not expenses of printing and mailing of
offering documents and literature used for any promotional
purposes);
(j) compensation and travel expenses of Trustees who are not
"interested persons" of the Advisor within the meaning of
the 1940 Act;
(k) the expense of furnishing, or causing to be furnished, to
each shareholder statements of account;
(l) charges and expenses of legal counsel in connection with
matters relating to the Trust, including, without
limitation, legal services rendered in connection with the
Trust's corporate and financial structure, day to day legal
affairs of the Trust and relations with its shareholders,
issuance of Trust shares, and registration and qualification
or securities under Federal, state and other laws;
(m) the expenses of attendance at professional meetings of
organizations such as the Investment Company Institute by
officers and Trustees of the Trust, and the membership or
association dues of such organizations;
(n) the cost and expense of maintaining the books and records of
the Trust;
(o) the expense of obtaining and maintaining a fidelity bond as
required by Section 17(g) of the 1940 Act and the expense of
obtaining and maintaining an errors and omissions policy;
36
<PAGE>
(p) interest payable on Trust borrowing;
(q) postage; and
(r) any other costs and expenses incurred by the Advisor for
Trust operations and activities, including but not limited
to the organizational costs of the Trust if initially paid
by the Advisor.
4. COMPENSATION
For the services and facilities to be provided to the Trust by the
Advisor as provided in Paragraph 2 hereof, the Trust shall pay the
Advisor a fee at the annual rate set forth in Exhibit A ("Annual
Fee"). The Trust shall pay such amounts monthly, based on the Fund's
average daily net assets, as reflected in the books and records of the
Trust in accordance with procedures established from time to time by
or under the direction of the Board of Trustees of the Trust.
5. TRUST TRANSACTIONS.
The Advisor agrees that neither it nor any of its officers, directors,
employees or agents will take any long- or short-term position in the
shares of the Trust; provided, however, that such prohibition shall
not prevent the purchase of shares of the Trust by any of the persons
above described for their account and for investment at the price (net
asset value) at which such shares are available to the public at the
time of purchase or as part of the initial capital of the Trust.
6. RELATIONS WITH TRUST.
Subject to and in accordance with the Amended and Restated Master
Trust Agreement and By-Laws of the Trust and the Articles of
Incorporation and By-Laws of the Advisor, respectively, it is
understood (i) that Trustees, officers, agents and shareholders of the
Trust are or may be interested in the Advisor (or any successor
thereof) as directors, officers, or otherwise; (ii) that directors,
officers, agents and shareholders of the Advisor are or may be
interested in the Trust as Trustees, officers, shareholders or
otherwise; and (iii) that the Advisor (or any such successor) is or
may be interested in the Trust as a shareholder or otherwise and that
the effect of any such adverse interests shall be governed by said
Master Trust Agreement and By-laws.
7. LIABILITY OF ADVISOR AND OFFICERS AND TRUSTEES OF THE TRUST.
Neither the Advisor nor its officers, directors, employees, agents or
controlling persons or assigns shall be liable for any error of
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judgment or law, or for any loss suffered by the Trust or its
shareholders in connection with the matters to which this Agreement
relates, except that no provision of this Agreement shall be deemed to
protect the Advisor or such persons against any liability to the Trust
or its shareholders to which the Advisor might otherwise be subject by
reason of any willful misfeasance, bad faith or gross negligence in
the performance of its duties or the reckless disregard of its
obligations and duties under this Agreement.
8. DURATION AND TERMINATION OF THIS AGREEMENT.
(a) Duration.
--------
This Agreement shall become effective on the date hereof for the
Initial Series. Unless terminated as herein provided, this Agreement
shall remain in full force and effect until May 1, 1996 and shall
continue in full force and effect for periods of one year thereafter
so long as such continuance is approved at least annually (i) by
either the Trustees of the Trust or by vote of a majority of the
outstanding voting shares (as defined in the 1940 Act) of the Trust,
and (ii) in either event by the vote of a majority of the Trustees of
the Trust who are not parties to this Agreement or "interested
persons" (as defined in the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on such approval.
(b) Additional Series.
-----------------
As additional series, other than the Fund, are established, the
Agreement shall become effective with respect to each such series
listed in Exhibit A at the Annual Fee set forth in such Exhibit upon
the initial public offering of such new series, provided that the
Agreement has previously been approved for continuation as provided in
subsection (a) above.
(c) Termination.
-----------
This Agreement may be terminated at any time, without payment of any
penalty, by vote of the Trustees of the Trust or by vote of a majority
of the outstanding shares (as defined in the 1940 Act), or by the
Advisor, on sixty (60) days written notice to the other party.
(d) Automatic Termination.
---------------------
This Agreement shall automatically and immediately terminate in the
event of its assignment.
9. PRIOR AGREEMENT SUPERSEDED.
This Agreement supersedes any prior agreement relating to the subject
matter hereof between the parties.
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10. SERVICES NOT EXCLUSIVE.
The services of the Advisor to the Trust hereunder are not to be
deemed exclusive, and the Advisor shall be free to render similar
services to others and to engage in other activities.
11. MISCELLANEOUS.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
(b) If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the
remainder of this Agreement shall not be affected thereby.
12. LIMITATION OF LIABILITY.
The Term Van Eck Worldwide Insurance Trust means and refers to the
Trustees from time to time serving under the Amended and Restated
Master Trust Agreement of the Trust dated _________ __, 19__, 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 Trustees, shareholders,
nominees, officers, agents or employees of the Trust, personally, but
bind only the assets and property of the Trust, as provided in the
Amended and Restated Master Trust Agreement of the Trust. The
execution and delivery of this Agreement have been authorized by the
Trustees and the Trust, acting as such, and neither such authorization
by such officer shall be deemed to have been made by any of them
personally, but shall bind only the assets and property of the Trust
as provided in its Amended and Restated Master Trust Agreement.
In WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the date first set forth above.
[SEAL] VAN ECK WORLDWIDE INSURANCE TRUST
Attest:_____________________ By____________________________
President
[SEAL] VAN ECK ASSOCIATES CORPORATION
Attest:_____________________ By_____________________________
President
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EXHIBIT A
Annual Advisory Fee
Name of Series (as a % of average daily net assets)
- - - -------------- ------------------------------------
Worldwide Bond Fund 1.00%
Gold and Natural Resources Fund 1.00%
40
