SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
VAN ECK WORLDWIDE INSURANCE TRUST
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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[X] No fee required.
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[ ] Fee paid previously with preliminary materials.
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VAN ECK WORLDWIDE INSURANCE TRUST
GOLD AND NATURAL RESOURCES FUND
99 PARK AVENUE,
NEW YORK, NEW YORK 10016
(212) 687-5200 TOLL FREE (800) 826-1115
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NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
WEDNESDAY, APRIL 9, 1997
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A SPECIAL MEETING of SHAREHOLDERS OF GOLD AND NATURAL RESOURCES FUND (the
"Fund"), a series of VAN ECK WORLDWIDE INSURANCE TRUST (the "Trust") will be
held at the offices of the Trust, 8th Floor, 99 Park Avenue, New York, New
York on Wednesday, April 9, 1997, at 3:00 P.M., Eastern Time, for the
following purposes:
(1) To approve a change in the Fund's investment objective and concentration
policy;
(2) To approve a change in the Fund's investment restrictions to permit the
Fund to invest in indexed notes and swaps;
(3) To approve a change in the Fund's investment restriction regarding
illiquid securities; and
(4) To consider and act upon any other matters which may properly come before
the meeting or any adjournment thereof.
Shareholders of record at the close of business on Monday, February 10, 1997
are entitled to notice of, and to vote at, the Special Meeting.
By order of the Board of Trustees,
Thaddeus Leszczynski ,
Secretary
February 12, 1997
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WHETHER YOU EXPECT TO ATTEND THE SPECIAL MEETING OR NOT, PLEASE
COMPLETE, DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY.
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GOLD AND NATURAL RESOURCES FUND
OF
VAN ECK WORLDWIDE INSURANCE TRUST
99 PARK AVENUE, NEW YORK, NEW YORK 10016 (212) 687-5200 TOLL FREE (800) 826-
1115
PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS--WEDNESDAY, APRIL 9, 1997
This Proxy Statement is furnished to shareholders of the GOLD AND NATURAL
RESOURCES FUND (the "Fund"), a series 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 a Special Meeting of Shareholders of the
Fund (the "Special Meeting") to be held at the offices of the Trust, 99 Park
Avenue, 8th floor, New York, New York on Wednesday, April 9, 1997 at 3:00
P.M., Eastern Time, for the purposes set forth in the accompanying Notice of
Special Meeting of Shareholders. The enclosed proxy card can be revoked by
notice in writing to the Trust at any time before it is exercised.
Shareholders who execute proxy cards may still vote in person at the Special
Meeting if they so desire or by subsequently executing and submitting a new
proxy card. The cost of soliciting proxies will be borne by Van Eck Associates
Corporation (the "Adviser") and/or the participating insurance companies, as
the case may be. In addition to solicitation by mail, some of the officers and
employees of the Trust or the Adviser, without extra remuneration, may conduct
additional solicitation by telephone, telegraph and personal interview. This
proxy material is being mailed to shareholders on or about February 21, 1997.
The Trust's five series, including the Fund, serve as a funding medium for
the variable annuity accounts and variable life contracts of insurance
companies. Nationwide Life Insurance Company, Provident Mutual Life Insurance
Company, Provident Mutual Life and Annuity Company of America, Acacia Group,
American International Life Assurance Company of New York, AIG Life Insurance
Company, Charles Schwab Annuity Service, First ING Life Insurance Company of
New York, Fortis Financial Group, General American Life Insurance Company,
Great American Reserve Insurance Company, Indianapolis Life Insurance Company,
Security Life of Denver, and United Life Companies are the participating
insurance companies in the Fund (each a "PIC" and together "PICs") entitled to
vote as shareholders. Each PIC provides pass-through voting rights to its
variable contractholders on any proposal affecting the Fund. 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. However, 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.
Each proxy received will be voted by the PIC in accordance with the
contractholder's instructions with respect to the proposals set forth in the
accompanying Notice of Special Meeting. If no such instruction is indicated,
the proxy will be voted FOR each of the proposals. For shares as to 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 contractholders permitted to give instructions to the PICs and the
number of shares for which instructions may be given will be determined as of
February 10, 1997, the record date for the Special Meeting.
In the event there are not sufficient votes to approve the proposal at the
time of the Special Meeting, the Special Meeting may be adjourned in order to
permit further solicitations of proxies by the Trust. If the Trust proposes to
adjourn the Special Meeting by a vote of the shareholders, the persons named
in the enclosed proxy card will vote all shares for which they have voting
authority in favor of such adjournment.
SHARES OF BENEFICIAL INTEREST OUTSTANDING
As of February 10, 1997 there were outstanding approximately 10,238,773
shares of beneficial interest of the Fund. Each full share is entitled to one
full vote and each fractional share is entitled to a proportionate share of
one vote. Nationwide Insurance Company is the owner of record, not the
beneficial owner, of 9,829,222 shares (or 96% of the outstanding securities).
The Adviser owns 5,589 shares (or less than 1% of the outstanding securities).
There were no other persons or groups who were known by the Trust to own
beneficially more than 5% of the outstanding shares of beneficial interest of
the Fund as of the record date.
ANNUAL REPORT
The Fund's annual report for the year ended April 30, 1996 was previously
sent to shareholders. The Fund's annual report for the year ended December 31,
1996 will be provided to shareholders on or about February 28, 1997.
Additional copies of the reports will be provided free of charge by calling
the number or by writing to the address on the Notice of Meeting accompanying
this Proxy Statement.
REQUIRED VOTE
Approval of each Proposal is to be determined by the vote of a majority of
the outstanding shares of the Fund as defined in the Investment Company Act of
1940, as amended (the "Act"). This means an affirmative vote of the lesser of
(1) a majority of the outstanding shares of the Fund, or (2) 67% or more of
the shares of the Fund represented at the Special Meeting if more than 50% of
the outstanding shares of the Fund are present or represented by proxy.
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 Act or as may be required by the Trust Agreement. Shareholders
representing ten percent or more of the outstanding shares of the Trust have
the right to compel the Trustees to call a meeting of shareholders to consider
the removal of any Trustee or Trustees.
PROPOSAL NO. 1:
APPROVAL OF A CHANGE IN THE FUND'S INVESTMENT OBJECTIVE AND CONCENTRATION
POLICY
The Fund's investment objective is long-term capital appreciation by
investing in securities of companies engaged in the exploration, development,
production and distribution of gold and other natural resources. Current
income is not an investment objective. It is proposed that the investment
objective of the Fund be to seek long-
2
term capital appreciation by investing globally, primarily in "Hard Asset"
securities, as defined below. Income would be a secondary consideration. The
Trustees have concluded that it is appropriate at this time to expand the
investment opportunities available to the Fund in seeking long-term capital
appreciation for its shareholders.
In addition, it is the current policy of the Fund to concentrate its
investments (i.e., invest at least 25% of its assets) in the securities of
companies in Canada, the United States, Australia and South Africa, whose
value is tied, linked or dependent upon the actual or anticipated price of
gold, such as companies which are primarily engaged in gold mining.
The proposed concentration policy would require the Fund to invest at least
25% of its assets in companies that are directly or indirectly (whether
through supplier relationships, servicing agreements or otherwise) engaged to
a significant extent in the exploration, development, production or
distribution of one or more of the following sectors: (i) precious metals,
(ii) ferrous and non-ferrous metals, (iii) oil and gas, (iv) forest products,
(v) real estate, and (vi) other basic non-agricultural commodities (together
"Hard Assets"). This policy is a fundamental policy which could not be changed
without the vote of shareholders. As an additional, but non-fundamental
policy, the Fund would be able to invest up to 50% of its assets in any one of
the above sectors.
The Trustees have determined that the Fund would benefit from expanding the
sectors in which the Adviser may concentrate the Fund's investments, since the
Fund's current emphasis solely on securities related to gold restricts the
Adviser's flexibility to take advantage of investment opportunities that may
meet the Fund's investment objective. In addition, while concentration may
subject the Fund to greater risks and market fluctuations than funds with more
diversified portfolios, the Trustees believe that concentration in a group of
six sectors is less risky than concentration in a single sector.
Investing in all types of Hard Assets, not just gold, involves primarily
incremental, rather than fundamentally different, risks. The production and
marketing of Hard Assets may be affected by actions and changes in
governments. In addition, Hard Assets and securities of Hard Asset companies
may be cyclical in nature. During periods of economic or financial
instability, the securities of some Hard Asset companies may be subject to
broad price fluctuations, reflecting volatility of energy and basic materials
prices and possible instability of supply of various Hard Assets. In addition,
some Hard Asset companies may also be subject to the risks generally
associated with extraction of natural resources, such as the risks of mining
and oil drilling, and the risks of the hazards associated with natural
resources, such as fire, drought, increased regulatory and environmental
costs, and others. Securities of Hard Asset companies may also experience
greater price fluctuations than the relevant Hard Asset. In periods of rising
Hard Asset prices, such securities may rise at a faster rate, and conversely,
in times of falling Hard Asset prices, such securities may suffer a greater
price decline.
It is the Trust's intention, if this proposal is approved by shareholders,
to rename the Fund the Worldwide Hard Assets Fund in order to reflect the new
objective and concentration policy.
Approval of this proposal would permit the Fund to make substantial
investments not just in gold oriented securities, but also in one or more of
the Hard Asset sectors. The ability to concentrate in other Hard Asset
sectors, in addition to gold, will make the Fund more diversified and will
enable the Adviser to take advantage
3
of a wider variety of global investment opportunities. As a result, the
Trustees expect that the Fund's increased flexibility will benefit the Fund
and its shareholders.
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THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR PROPOSAL NO. 1.
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PROPOSAL NO. 2
APPROVAL OF A CHANGE IN THE FUND'S INVESTMENT RESTRICTIONS TO
PERMIT THE FUND TO INVEST IN INDEXED SECURITIES AND SWAPS
The Fund's Adviser wants the ability to invest in swaps, and in indexed
securities whose value is linked to one or more currencies, interest rates,
commodities or financial or commodity indices. The Adviser believes that
indexed securities, including structured notes, may offer unique investment
opportunities while it seeks long-term capital appreciation for the Fund. The
Adviser further believes that swaps will provide the Fund with an additional
means of attempting to hedge both currency and other risks involved in global
hard asset investing. Indexed securities and swaps are derivative securities.
An indexed note is a medium-term note whose coupon and/or principal
redemption are linked to the performance of an underlying asset or market
(such as the Standard & Poor's 500 Index) or to a change in economic
conditions (such as a change in interest rates). Indexed securities may be
positively or negatively indexed (i.e., their value may go in the same or the
opposite direction as the underlying asset). Indexed securities may have
return characteristics similar to direct investments in the underlying
instrument or to one or more options on the underlying instrument. Indexed
securities may be more volatile than the underlying instrument itself, and
present many of the same risks as investing in futures and options. Indexed
securities are also subject to credit risks associated with the issuer of the
security with respect to both principal and interest.
Indexed securities may be publicly traded or may be two-party contracts.
These two-party agreements are referred to as structured notes. If the Fund
purchases a structured note, it will make a payment of principal to the
counterparty. Some structured notes have a guaranteed repayment of principal
while others place a portion (or all) or the principal at risk. The Fund will
purchase structured notes only from counterparties rated A or better by
Standard & Poor's Corporation, Moody's Investors Service, Inc. or another
nationally recognized statistical rating organization. The Adviser will
monitor the liquidity of structured notes under the supervision of the Board
of Trustees, and notes determined to be illiquid will be aggregated with other
illiquid securities for purposes of the limitation on illiquid investments.
A swap is an exchange of one security for another, or an exchange of one
stream of payments for another, or the exchange of rights to make or receive
payments in specified currencies. Examples include currency swaps (e.g., U.S.
dollars for British pounds) or interest rate swaps (U.S. Treasury rate for the
LIBOR rate). Since swaps are individually negotiated, the Fund may expect to
achieve an acceptable degree of correlation between its portfolio investments
and its swap positions. Currency swaps usually involve the delivery of the
entire principal value of designated currency in exchange for the other
designated currency. Therefore, the entire principal value of a currency swap
is subject to the risk that the other party to the swap will default on its
contractual delivery obligations.
4
The use of swaps is a highly speculative activity which involves investment
techniques and risks different from those associated with ordinary portfolio
transactions. If the Adviser is incorrect in its forecasts of market values,
currency exchange rates and/or Hard Asset values, the investment performance
of the Fund would be less favorable than it would have been if this investment
technique were not used. Swaps are generally considered illiquid and will be
aggregated with other illiquid positions for purposes of the limitation on
illiquid investments.
The Trust is prohibited from making loans and borrowing by two of its
fundamental investment restrictions. Management is therefore proposing
exceptions to these investment restrictions to permit the Fund to invest in
indexed securities and swaps. Set forth below are the investment restrictions
as they will apply to the Fund; additions are underscored.
The Fund may not:
"3. Make loans, except by (i) purchase of marketable bonds, debentures,
commercial paper and similar marketable evidences of indebtedness (such as
structured notes, indexed securities and swaps with respect to Worldwide
Hard Assets Fund, and Gold and Natural Resources Fund);"
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"7. Issue senior securities except insofar as a Fund may be deemed to
have issued a senior security by reason of . . . (v) foreign currency swaps
(Worldwide Emerging Markets Fund, Hard Assets Fund, Worldwide Balanced Fund
and Gold and Natural Resources Fund)."
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The Trustees believe that the ability to use structured notes and other
indexed securities would allow the Fund to participate in the performance of
the underlying commodities without the risk of directly holding the commodity.
The Trustees also believe that swaps may reduce the Fund's exposure to
fluctuations in currency valuation, or interest rate fluctuations. Although
there can be no assurance that markets, currency values and interest rates
will move as anticipated, the Trustees have concluded that the increased
flexibility provided to the Adviser by allowing investment in these financial
instruments will benefit the Fund and its shareholders.
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THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR PROPOSAL NO. 2.
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PROPOSAL NO. 3
APPROVAL OF A CHANGE IN THE FUND'S INVESTMENT
RESTRICTION REGARDING ILLIQUID SECURITIES
The Fund currently has a fundamental investment restriction which permits it
to invest no more than 10% of its assets in so-called "illiquid securities."
Illiquid securities are defined by the Securities and Exchange Commission
("SEC") as securities that are not readily marketable, are subject to legal or
contractual restrictions on resale or cannot be reduced to cash within seven
days at approximately the price used to calculate the net asset value. The
limitation was designed to address the need of a mutual fund, which has
continual redemptions, to have sufficient liquid assets (i.e., cash or cash
equivalents) to meet those redemptions. The 10% maximum was first imposed many
years ago when the financial markets, instruments and their investors were
less sophisticated. In recent years, the SEC, in recognition of the
development of these markets, instruments and investors, has permitted funds
to invest up to 15% of their assets in illiquid securities.
5
The Trustees have determined that it is advisable to make the Fund's
restriction regarding illiquid securities a non-fundamental one (i.e., one
that may be changed without shareholder approval), in order to give the Fund
more investment flexibility. If shareholders approve this change, it is the
Adviser's intention to recommend that the Board permit the Fund to invest up
to the maximum permitted by the SEC (currently 15% of assets) in illiquid
securities. This will allow the Fund to take full advantage of its ability to
invest in instruments that may not be liquid (such as certain private
placements, warrants, repurchase agreements and commodities).
Set forth below is the Trust's non-fundamental investment restriction as it
will apply to the Fund; additions are underscored.
The Fund may not:
"12. Invest in securities which are . . . (ii) with respect to Worldwide
Emerging Markets Fund, Worldwide Hard Assets Fund, Worldwide Balanced Fund
and Gold and Natural Resources Fund "illiquid" securities, . . . if the
-----------------------------------
result is that more than 15% of its total net assets would be invested in
such securities."
The Trustees believe that changing the Fund's restriction regarding illiquid
securities from a fundamental restriction to a non-fundamental restriction
will provide the Fund with additional investment flexibility and will
therefore benefit the Fund and its shareholders.
THE BOARD OF TRUSTEES RECOMMENDS THAT SHAREHOLDERS VOTE FOR PROPOSAL NO. 3.
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OTHER MATTERS TO COME BEFORE THE MEETING
The Trustees do not intend to present any other business at the Special
Meeting, nor are they aware that any shareholder intends to do so. If,
however, any other matters are properly brought before the Special Meeting,
the persons named as proxies will vote according to their best judgment with
respect to these matters.
By order of the Board of Trustees,
Thaddeus Leszczynski
Secretary
February 12, 1997
WHETHER OR NOT YOU PLAN TO ATTEND, IT WOULD BE APPRECIATED IF YOU WOULD
FILL IN, DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE. NO POSTAGE IS NECESSARY IF IT IS MAILED IN THE
CONTINENTAL UNITED STATES.
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6
PROXY
VAN ECK WORLDWIDE INSURANCE TRUST
GOLD AND NATURAL RESOURCES FUND
SPECIAL SHAREHOLDERS MEETING - WEDNESDAY, APRIL 9, 1997
The undersigned shareholder of GOLD AND NATURAL RESOURCES FUND (the
"Fund'), a series of VAN ECK WORLDWIDE INSURANCE TRUST (the "Trust"), having
received Notice of the Meeting of Shareholders of the Fund to be held on
Wednesday, April 9, 1997 and the Proxy Statement accompanying such Notice,
hereby constitutes and appoints Susan I. Grant and Keith L. Schnaars and each of
them, true and lawful attorneys or attorney for the undersigned, with several
powers of substitution, for and in the name, place and stead of the undersigned,
to attend and vote all shares of the Fund which the undersigned would be
entitled to vote at the Meeting to be held at 99 Park Avenue, 8th Floor, New
York, New York, on Wednesday, April 9, 1997, at 3:00 P.M., Eastern Time, and at
any and all adjournments thereof, with all powers the undersigned would possess
if personally present.
THE BOARD OF TRUSTEES OF THE TRUST IS SOLICITING THIS PROXY
MANAGEMENT RECOMMENDS A VOTE FOR THE PROPOSALS ON THE REVERSE SIDE HEREOF. THE
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SHARES REPRESENTED HEREBY WILL BE VOTED AS INDICATED ON THE REVERSE SIDE OR FOR
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THE PROPOSAL IF NO CHOICE IS INDICATED.
Please mark your proxy, date and sign it on the reverse side and return it
promptly in the accompanying envelope which requires no postage if mailed in the
United States.
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PROPOSALS
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1. To approve a change in the Fund's investment objective and concentration
policy.
FOR _____ AGAINST ____ ABSTAIN _____
2. To approve a change in the Fund's investment restrictions to permit the Fund
to invest in indexed notes and swaps.
FOR _____ AGAINST ____ ABSTAIN _____
3. To approve a change in the Fund's investment restriction regarding illiquid
securities.
FOR _____ AGAINST ____ ABSTAIN _____
Dated: _________________________________ 1997
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Signature of Shareholder
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Signature of Co-Owner
For joint accounts, all co-owners must sign.
Executors, administrators, trustees, etc. should
so indicate when signing.