FIRST INVESTORS PPP FOR INV IN FIR INV HIGH YIELD FUND INC, 485BPOS, 1995-04-25

FIRST INVESTORS PPP FOR INV IN FIR INV HIGH YIELD FUND INC
485BPOS, 1995-04-25

Previous: PREMIER FINANCIAL SERVICES INC, 10-Q, 1995-04-25

Next: FIRST INVESTORS SGL P&PP FOR INV IN FIR INV FUND FOR INC INC, 485BPOS, 1995-04-25

<PAGE>

As filed with the Securities and Exchange Commission on April 25, 1995

Registration No. 2-53252
811-2564
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------

Post-Effective Amendment No. 20

FORM S-6

FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933
OF SECURITIES OF A UNIT INVESTMENT TRUST
REGISTERED ON FORM N-8B-2
PURSUANT TO THE INVESTMENT
COMPANY ACT OF 1940

FIRST INVESTORS PERIODIC
PAYMENT PLANS FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.
(Name of Trust)

FIRST INVESTORS CORPORATION
(Name of Depositor)

95 Wall Street
New York, New York 10005
(Complete address of depositor's principal
executive offices)

Mr. Larry R. Lavoie
Secretary and General Counsel
First Investors Corporation
95 Wall Street
New York, New York 10005
(Name and complete address of agent for service)

Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.

It is proposed that this filing will become effective on May 1, 1995 pursuant to
paragraph (b) of Rule 485.

Pursuant to Rule 24f-2 under the Investment Company Act of 1940, Registrant has
previously elected to register an indefinite number of securities under the
Securities Act of 1933. Registrant filed a Rule 24f-2 Notice for its fiscal
year ending December 31, 1994 on February 21, 1995.

<PAGE>

TABLE OF CONTENTS

TO FORM S-6

Contents of Post-Effective Amendment No. 20 to Registration Statement of First
Investors Periodic Payment Plans for Investment in First Investors High Yield
Fund, Inc.

1. The Facing Page

2. The Prospectus consisting of 43 pages

3. The Signature Page

4. Consent of Accountants

5. Power of Attorney

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT
PLANS FOR INVESTMENT IN FIRST INVESTORS
HIGH YIELD FUND, INC.

CROSS-REFERENCE SHEET

N-8B-2
Item No. Location
- -------- --------

1-8 Organizational and General Front Cover; Concerning the
Information Sponsor, First Investors
Corporation; Concerning the
Duties of the Custodian and
the Sponsor; Registration and
Legality of Offering;
Agreements

9 Material Litigation Concerning the Duties of the
Custodian and the Sponsor

10 General Information Concern- Rights and Privileges of
ing the Securities of the Planholders; Method of
Trust and the Rights of Investing Payments and
Holders Distributions; Method of
Selling Shares in the Event of
Partial Liquidation or
Complete Termination; Income
Dividends and Capital Gains
Distributions; Substitution of
Other Shares as the Underlying
Investment of the Plans;
Termination of the Plans

11-12 Information Concerning the Front Cover; Underlying
Securities Underlying the Investment; Concerning the
Trust's Securities Duties of the Custodian and
the Sponsor; Agreements

13 Information Concerning Statistical Data Applicable to
Loads, Fees, Charges and First Investors Plans;
Expenses Allocation of Monthly Payments
and Deductions; Deductions
Single Payment Plans; Combined
Plans for Discount; Letter of
Intent; Agreements; Other
Deductions From Assets or
Distributions; Rights and
Privileges of Planholders;
Termination of Plans

14-24 Information Concerning the Operation of a Periodic Payment
Operations of the Trust Plan; Single Payment

<PAGE>

N-8B-2
Item No. Location
- -------- --------

Plan; Method of Investing Payments and
Distributions; Termination of
Plans; Other Deductions From
Assets or Distributions; Rights
and Privileges of Planholders;
Concerning the Duties of the
Custodian and the Sponsor;
Concerning the Sponsor, First In-
vestors Corporation

25-27 Organization and Operations Concerning the Sponsor, First
of Depositor Investors Corporation

28 Officials and Affiliated Concerning the Sponsor, First
Persons of Depositor Investors Corporation; General

29 Companies Owning Securities General
of Depositor

30 Controlling Persons Not Applicable

31-34 Compensation of Officers and Concerning the Sponsor, First
Directors of Depositor Investors Corporation

35-38 Distribution of Securities Agreements; Statistical Data
Applicable to First Investors
Plans

41-43 Information Concerning Concerning the Sponsor, First
Principal Underwriter Investors Corporation; General

44-45 Offering Price or Pertinent Provisions of the
Acquisition Valuation of Prospectus of First Investors
Securities of the Trust High Yield Fund, Inc. (File
No. 33-4935) incorporated
herein by reference

46 Redemption Valuation of Pertinent Provisions of the
Securities of the Trust Prospectus of First Investors
High Yield Fund, Inc. (File
No. 33-4935) incorporated
herein by reference

47 Purchase and Sale of Inter- Rights and Privileges of
ests in Underlying Shareholders; Method of
Securities from and to Investing Payments and
Security Holders Distributions; Method of
Selling Shares in the Event of
Partial Liquidation or
Complete Termination

<PAGE>

N-8B-2
Item No. Location
- -------- ---------

48-50 Information Concerning the Concerning the Duties of the
Trustee or Custodian Custodian and the Sponsor;
Custodian, Bookkeeping and
Maintenance Fees; Other
Deductions From Assets or
Distributions

51 Information Concerning Not Applicable
Insurance of Holders of
Securities

52* Policy of Registrant Substitution of Other Shares
as the Underlying Investment
of the Plans; Rights and
Privileges of Planholders

53 Regulated Investment Company Tax Status

54-58 Financial and Statistical Illustration of a Plan Under
Information First Investors Corporation
Contractual Plans for
Investment in First Investors
Government Fund, Inc.;

59 Financial Statements Financial Statements and
Report of Independent
Certified Public Accountants

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS FOR
INVESTMENT IN FIRST INVESTORS HIGH YIELD FUND, INC.

First Investors Corporation, as Sponsor, offers the following long term
investment programs providing for investment in First Investors High Yield Fund,
Inc. (the "Fund").

PERIODIC PAYMENT PLANS-providing for regular monthly payments for 10 or 15
years. The sales charge on 10-Year Plans ranges from 6.15% on $6,000 Plans ($50
per month) to 4.40% on $120,000 Plans ($1,000 per month) of total payments and
from 6.76% to 4.61% of the net amount invested, respectively. Total deductions
range from 10.07% to 4.88% of the net amount invested, respectively. Plans in
excess of $120,000 are subject to a sales charge of 4.40% (reducing to 3.40% on
Plans of $250,000 and over, 2.40% on Plans of $500,000 and over and 1.40% on
Plans of $1,000,000 and over). Plans are also subject to maintenance and
custodian fees.

The sales charge on 15-Year Plans ranges from 6.15% on $9,000 Plans ($50
per month) to 4.40% on $180,000 Plans ($1,000 per month) of total payments and
from 6.77% to 4.61% of the net amount invested, respectively. Total deductions
range from 10.08% to 4.88% of the net amount invested, respectively. Plans in
excess of $180,000 are subject to a sales charge of 4.40% (reducing to 3.40% on
Plans of $250,000 and over, 2.40% on Plans of $500,000 and over and 1.40% on
Plans of $1,000,000 and over). Plans are also subject to maintenance and
custodian fees.

A double initial payment is required on all Periodic Payment Plans. The
Planholder's net payments, after deducting all applicable fees, are invested in
Class A shares ("shares") of the Fund at net asset value. The value of Fund
shares is subject to fluctuations in accordance with the market value of the
securities it holds for investment. Furthermore, the provisions of the Periodic
Payment Plans are such that a substantial part of the costs of the Plan is
charged the first year: in fact, 50% of the first 13 monthly payments is
deducted as a sales charge. For example, even after application of the "refund
privileges" described herein under "Refund Privileges," total charges of a
minimum Periodic Payment Plan would amount to 18% of total payments if the Plan
were carried for any period of time between forty-five days and eighteen months.
Moreover, if such a minimum Plan were carried for nineteen months, total charges
would amount to 37.14% of total payments under the 10-year Plan and 37.75% under
the 15-year Plan; they would amount to 29.16% and 30.07%, respectively, under
the 10- and 15-year Plans, if carried for two years. Therefore, it is obvious
that a loss would be incurred in the event of early withdrawal or termination by
a Planholder or if the Planholder redeemed his or her underlying Fund shares at
a time when their redemption value is less than their cost to the Planholder.
Consideration should be given to these factors by a prospective Planholder who
should be reasonably certain of his or her ability to continue the Plan to
completion before considering this long-term investment program.

Shares of the Fund may also be purchased outright at a sales charge not in
excess of 6.9%, without penalty for early termination or payment of the
maintenance and custodian fees and service charges applicable to the Plans
offered hereby. (See the prospectus of the Fund and "Statistical Data Applicable
to First Investors Plans" in this Prospectus.) Direct purchases of Fund shares
enable the investor to put more of his or her money to work immediately and over
the life of a Fund account than would be possible under the life of the Periodic
Payment Plan offered hereby. Prepayment of all or any part of the first 13
payments under the Periodic Payment Plan produces a smaller net investment after
deduction of applicable charges than would result from direct investment of the
same amount in shares of the Fund. Such prepayment would increase possible loss
in the event of early termination. An investor has (a) a 45-day right of
withdrawal, and (b) a right to receive during the first 18 months (or 28 months,
if applicable) of the Plan the value of his or her account and a portion of the
sales charges paid prior to his or her withdrawal. For a full discussion of
these withdrawal rights, see "Refund Privileges" in this Prospectus.

The Fund, the Plans' Sponsor, the Fund's Investment Adviser and/or certain
affiliated entities and persons have entered into settlements with the
Securities and Exchange Commission and various state regulators to resolve
allegations regarding certain sales of shares of the Fund that occurred prior to
December 1990. For the period November 8, 1990 (the commencement date of the
first litigation) through the date of this Prospectus, the Sponsor voluntarily
suspended new Plan sales. For a further discussion of these settlements and
related regulatory matters, the past substitution of the underlying investment
of the Plans, and certain exchange privileges, see "Underlying Investment,"
"Rights and Privileges of Planholders-Exchanges" and "Sponsor and Underwriter--
Regulatory Matters."

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS IS VALID ONLY WHEN ACCOMPANIED BY THE CURRENT FIRST INVESTORS
HIGH YIELD FUND, INC. PROSPECTUS

The date of this Prospectus is May 1, 1995

<PAGE>

ALLOCATION OF MONTHLY PAYMENTS AND DEDUCTIONS* 10-YEAR PLANS

SALES CHARGE MAINTENANCE
---------------------------------------- AND PERCENTAGE
From CUSTODIAN RELATIONSHIP
From Each FEES* OF TOTAL CHARGES
Each of Subse- % of Sales --------------- ------------------
Aggregate the First quent Total Charge to Fee Per Net To To Net
Monthly Amount of 13 Monthly Monthly Sales Aggregate Pay- Total Total Investment Aggregate Invest-
Payments Payments Payments** Payment Charge Payments ment Fee Charges in Fund Payments ment
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>

$ 50 $ 6,000 $ 24.75 $ .44 $ 368.83 6.15% $1.50 $180.00 $ 548.83 $ 5,451.17 9.15% 10.07%
75 9,000 37.00 .68 553.76 6.15 2.00 240.00 793.76 8,206.24 8.82 9.67
100 12,000 49.50 .88 737.66 6.15 2.00 240.00 977.66 11,022.34 8.15 8.87
125 15,000 62.00 1.09 922.63 6.15 2.00 240.00 1,162.63 13,837.37 7.75 8.40
150 18,000 74.50 1.29 1,106.53 6.15 2.00 240.00 1,346.53 16,653.47 7.48 8.09
167 20,040 82.95 1.44 1,232.43 6.15 2.00 240.00 1,472.43 18,567.57 7.35 7.93
175 21,000 87.25 1.47 1,291.54 6.15 2.00 240.00 1,531.54 19,468.46 7.29 7.87
200 24,000 99.50 1.71 1,476.47 6.15 2.00 240.00 1,716.47 22,283.53 7.15 7.70
225 27,000 112.00 .65 1,525.55 5.65 2.50 300.00 1,825.55 25,174.45 6.76 7.25
250 30,000 124.50 .71 1,694.47 5.65 2.50 300.00 1,994.47 28,005.53 6.65 7.12
300 36,000 149.50 .85 2,034.45 5.65 2.50 300.00 2,334.45 33,665.55 6.48 6.93
350 42,000 174.50 .98 2,373.36 5.65 2.50 300.00 2,673.36 39,326.64 6.37 6.80
400 48,000 199.50 1.11 2,712.27 5.65 2.50 300.00 3,012.27 44,987.73 6.28 6.70
425 51,000 161.50 6.12 2,754.34 5.40 2.50 300.00 3,054.34 47,945.66 5.99 6.37
500 60,000 190.00 7.20 3,240.40 5.40 2.50 300.00 3,540.40 56,459.60 5.90 6.27
750 90,000 280.00 11.40 4,859.80 5.40 2.50 300.00 5,159.80 84,840.20 5.73 6.08
1000 # 120,000 325.00 9.86 5,280.02 4.40 2.50 300.00 5,580.02 114,419.98 4.65 4.88

<FN>
* After a period of ten years from the date of a Plan or in the event no
payment has been made for a period of one year, the Plan is subject to
annual maintenance and custodian fees of 25/100 of 1% per year of the total
agreed payments (minimum $3.00 and maximum $30.00 per year) deducted from
dividend and capital gain distributions (whether paid in cash or additional
Fund shares) or from the proceeds of the redemption of Fund shares to the
extent that dividend and capital gain distributions are insufficient.

** A double initial payment is required on all Periodic Payment Plans and
deductions from this payment are double. The next regular scheduled
payment becomes due one month from the date of the initial payment.

# Periodic Payment Plans of larger denominations may be issued subject to
deductions for sales charges of 4.40% on Plans of $120,000 and over, 3.40%
on Plans of $250,000 and over, 2.40% on Plans of $500,000 and over and
1.40% on Plans of $1,000,000 and over. Deductions will be made on the same
proportionate basis as in the $1,000 per month Plan and maintenance and
custodian fees will be $300.

</TABLE>

<PAGE>

ALLOCATION OF MONTHLY PAYMENTS AND DEDUCTIONS* 15-YEAR PLANS

$ 50 $ 9,000 $ 24.75 $ 1.39 $ 553.88 6.15% $ 1.50 $270.00 $ 823.88 $ 8,176.12 9.15% 10.08%
75 13,500 37.00 2.09 830.03 6.15 2.00 360.00 1,190.03 12,309.97 8.82 9.67
100 18,000 49.50 2.78 1,107.76 6.15 2.00 360.00 1,467.76 16,532.24 8.15 8.88
125 22,500 62.00 3.46 1,383.82 6.15 2.00 360.00 1,743.82 20,756.18 7.75 8.40
150 27,000 74.50 3.34 1,526.28 5.65 2.00 360.00 1,886.28 25,113.72 6.99 7.51
167 30,060 82.95 3.71 1,697.92 5.65 2.00 360.00 2,057.92 28,002.08 6.85 7.35
175 31,500 87.25 3.87 1,780.54 5.65 2.00 360.00 2,140.54 29,359.46 6.80 7.29
200 36,000 99.50 4.43 2,033.31 5.65 2.00 360.00 2,393.31 33,606.69 6.65 7.12
225 40,500 112.00 4.98 2,287.66 5.65 2.50 450.00 2,737.66 37,762.34 6.76 7.25
250 45,000 124.50 5.53 2,542.01 5.65 2.50 450.00 2,992.01 42,007.99 6.65 7.12
300 54,000 149.50 5.82 2,915.44 5.40 2.50 450.00 3,365.44 50,634.56 6.23 6.65
350 63,000 174.50 6.79 3,402.43 5.40 2.50 450.00 3,852.43 59,147.57 6.11 6.51
400 72,000 199.50 7.75 3,887.75 5.40 2.50 450.00 4,337.75 67,662.25 6.02 6.41
500 90,000 190.00 14.31 4,859.77 5.40 2.50 450.00 5,309.77 84,690.23 5.90 6.27
600 108,000 200.00 12.89 4,752.63 4.40 2.50 450.00 5,202.63 102,797.37 4.82 5.06
750 135,000 205.00 19.61 5,939.87 4.40 2.50 450.00 6,389.87 128,610.13 4.73 4.97
1000 # 180,000 250.00 27.96 7,919.32 4.40 2.50 450.00 8,369.32 171,630.68 4.65 4.88

<FN>
* After a period of fifteen years from the date of a Plan or in the event no
payment has been made for a period of one year, the Plan is subject to
annual maintenance and custodian fees of 25/100 of 1% per year of the total
agreed payments (minimum $3.00 and maximum $30.00 per year) deducted from
dividend and capital gain distributions (whether paid in cash or additional
Fund shares) or from the proceeds of the redemption of Fund shares to the
extent that dividend and capital gain distributions are insufficient.

# Periodic Payment Plans of larger denominations may be issued subject to
deductions for sales charges of 4.40% on Plans of $180,000 and over, 3.40%
on Plans of $250,000 and over, 2.40% on Plans of $500,000 and over and
1.40% on Plans of $1,000,000 and over. Deductions will be made on the same
proportionate basis as in the $1,000 per month Plan and maintenance and
custodian fees will be $450.
</TABLE>

<PAGE>

ALLOCATION OF PAYMENTS AT VARIOUS STAGES ($6,000 10-YEAR $50 MONTHLY PLAN)

(At the End (At the End (At the End (At the End
of 10 Years) of 2 Years) of 1 Year) of 6 Months)
---------------------- ----------------------- --------------------- ---------------------
% of Amount % of Amount % of Amount % of Amount
Amount of Payments Amount of Payments Amount of Payments Amount of Payments
------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>

Total Payments . . . . . . . . . . $6,000.00 100.00% $1,250.00** 100.00% $650.00** 100.00% $350.00** 100.00%
Amount of Sales Charge . . . . . . 368.83 6.15 327.03 26.16 321.75 49.50 173.25 49.50
Maintenance and Custodian Fees*. . 180.00 3.00 37.50 3.00 19.50 3.00 10.50 3.00
Total deductions . . . . . . . . . 548.83 9.15+ 364.53 29.16 341.25 52.50 183.75 52.50
Net Amount Invested. . . . . . . . 5,451.17 90.85 885.47 70.84 308.75 47.50 166.25 47.50

<FN>
+ 10.07% of net amount invested

</TABLE>

ALLOCATION OF PAYMENTS AT VARIOUS STAGES ($9,000 15-YEAR $50 MONTHLY PLAN)

(At the End (At the End (At the End (At the End
of 15 Years) of 2 Years) of 1 Year) of 6 Months)
---------------------- ----------------------- --------------------- ---------------------
% of Amount % of Amount % of Amount % of Amount
Amount of Payments Amount of Payments Amount of Payments Amount of Payments
------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>

Total Payments . . . . . . . . . . $9,000.00 100.00% $1,250.00** 100.00% $650.00** 100.00% $350.00** 100.00%
Amount of Sales Charge . . . . . . 553.88 6.15 338.43 27.07 321.75 49.50 173.25 49.50
Maintenance and Custodian Fees*. . 270.00 3.00 37.50 3.00 19.50 3.00 10.50 3.00
Total deductions . . . . . . . . . 823.88 9.15+ 375.93 30.07 341.25 52.50 183.75 52.50
Net Amount Invested. . . . . . . . 8,176.12 90.85 874.07 69.93 308.75 47.50 166.25 47.50

<FN>
+ 10.06% of net amount invested

* Reference is made to tables on Pages 2 and 3 and "Other Deductions" for
maintenance and custodian fees on Periodic Payment Plans after completion
of payments and annual charges for special administrative duties.
** Reflects equivalent of one additional monthly payment because of the
required double initial payment.

</TABLE>

FOR COMPARISON OF COST OF FIC CONTRACTUAL PLAN VERSUS AN OPEN
ACCOUNT IN THE SAME UNDERLYING FUND SEE
"STATISTICAL DATA APPLICABLE TO FIRST INVESTORS PLANS."

THE PLANS

First Investors Periodic Payment Plans for Investment in First Investors
High Yield Fund, Inc. (each, a "Plan") is a long-term investment program. The
Sponsor of the Plan is First Investors Corporation (the "Sponsor"). The
custodian is The Bank of New York (the "Custodian"). Plan payments, after the
deduction of all applicable fees, are invested at net asset value in shares of
First Investors High Yield Fund, Inc., an open-end diversified management
investment company (the "Fund"). The Fund primarily seeks a high level of
current income and secondarily seeks growth of capital (see "Underlying
Investment").

PERIODIC PAYMENT PLANS

Periodic Payment Plans provide for regular and systematic monthly
investment over a period of either ten or fifteen years. From the investor's
viewpoint, the operation of the Plan is extremely simple. Once the investor
understands the Plan and decides to adopt it, the investor need only decide how
much to pay regularly--it can be as little as $50 per month, or as much as
$1,000 per month or more, limited to 120 or 180 payments. The investor can then
decide the most convenient time to make regular payments. The investor will also
probably choose to name a beneficiary by completing

<PAGE>

a Declaration of Trust. These questions settled, with the assistance of a First
Investors registered representative, the investor completes the appropriate Plan
application, writes out a check to the order of The Bank of New York, Custodian,
to cover the first payment (the initial payment requires a sum representing two
monthly payments), and the First Investors registered representative will
process the application and check. In a few days, after the approval of the
application by the Sponsor, a First Investors Periodic Payment Plan Certificate
will be forwarded to the investor. Following the double initial payment,
subsequent Plan payments will be made through First Investors Money Line or
Automatic Payroll Investment, as described below.

FIRST INVESTORS MONEY LINE. This service allows you to invest through
automatic deductions from your bank checking account. You must complete and sign
the First Investors Money Line portion of the Plan application in order to
participate in this service. Any loss or expense incurred by the Sponsor or any
delinquency in Plan payments resulting from insufficient funds in the
Planholder's checking account or otherwise will be the Planholder's liability.
You may decrease the amount or discontinue this service at any time by calling
Administrative Data Management Corp. at 1-800-423-4026 or writing to
Administrative Data Management Corp., 10 Woodbridge Center Drive, Woodbridge, NJ
07095-1198, Attention: Control Dept. To increase the amount, send a written
request to Administrative Data Management Corp. at the address noted above.
Allow up to 5 days for processing your request. Please include the Plan name and
account number whenever writing to Administrative Data Management Corp.

AUTOMATIC PAYROLL INVESTMENT. You also may arrange for automatic Plan
payments on a systematic basis through salary deductions, provided your employer
has direct deposit capabilities. You must complete and sign the Automatic
Payroll Investment portion of the Plan application in order to participate in
this service. Arrangements must also be made with your employer's Payroll
Department. You may change the amount invested or discontinue the service by
contacting your employer.

When a Planholder's payment is received, the Sponsor will determine the
authorized deductions and the number of full and fractional shares of the Fund
to be acquired and will credit the requisite shares to the Planholder's account.
To the extent that there are shares to be sold for other Planholders on the same
day, new shares purchased will be offset by shares sold. The price paid for
shares is the net asset value of shares of the Fund next determined after
receipt of such payment. See the Fund's Prospectus for information as to the
procedure for computing net asset value. Unless privileges of termination are
exercised by the Planholder or the Sponsor, each Plan shall continue in force
for a period of at least twenty years for a ten-year Periodic Payment Plan and
twenty-five years for a fifteen-year Periodic Payment Plan.

UNDERLYING INVESTMENT

First Investors High Yield Fund, Inc., an open-end diversified management
investment company, primarily seeks to earn a high level of current income and
secondarily seeks capital appreciation. The Fund seeks to achieve these
objectives by investing in lower-grade, high yielding, high risk debt securities
(commonly referred to as "junk bonds"). Investors should refer to the Fund's
Prospectus for a detailed description of the Fund's investment objectives and
policies. There is no assurance that the Fund's objectives will be achieved.

<PAGE>

As a result of the temporary suspension of sales of Fund shares, as of
February 6, 1991, shares of First Investors Government Fund, Inc. had been
substituted temporarily as the underlying investment of the Plans. Sales of
Fund shares resumed on December 20, 1993, and, as a result, monthly payments
received from that date forward are once again being invested in Fund shares,
and all redemption proceeds are obtained from redemptions of shares of First
Investors Government Fund, Inc. held in the Plans. First Investors Government
Fund, Inc. is a fund with an investment objective of a significant level of
current income which is consistent with security and liquidity of principal.
First Investors Government Fund invests no less than 80% of its assets in
obligations issued or guaranteed as to principal and interest by the United
States Government, its agencies or instrumentalities.

OTHER DEDUCTIONS

The Plan provides that there may be deducted from the assets of the
Planholder, fees or expenses as follows:

After the expiration of a period of ten years (or fifteen years for a
15-Year Plan) from the date of a Plan, or prior to the expiration of such
period, if there has been a lapse of one year from the date of the Planholder's
last payment which makes a Plan one year or more delinquent, a charge for
bookkeeping and administrative services will be made, in monthly, quarterly or
semiannual installments, at the rate of 25/100 of 1% per annum of the total
agreed payments, subject to a minimum annual charge of $3 and a maximum of $30.
This fee shall be deductible from dividend and capital gain distributions
(whether paid in cash or additional Fund shares) or from the proceeds of the
redemption of Fund shares to the extent that dividend and capital gain
distributions are insufficient.

In the case of an assignment, release of an assignment, transfer of
ownership of a retirement plan account, partial withdrawal or liquidation or
complete withdrawal and termination from a non-retirement plan account (if made
before completion of Plan payments or before the expiration of 10 years from the
date of issuance of a Single Payment Plan), certain transfers or replacement of
lost Plan certificates, and reinvestment of partial liquidations, a specified
service fee of $2.25 is charged. In the case of a partial withdrawal or
liquidation or complete withdrawal and termination from a retirement plan
account, a specified service fee of $7.00 is charged. For a retirement plan
transfer, Plan certificate transfer or replacement, reinvestment of a partial
liquidation or complete withdrawal and termination from a retirement plan
account, such fee may be paid directly by the Planholder or deducted from the
proceeds of the redemption of Fund shares, if desired. For an assignment or
release of an assignment, such fee must be paid directly by the Planholder.

After the thirteenth payment has been made on a Periodic Payment Plan, a
charge of up to $5.00 will be deducted on an annual basis from dividend or
capital gain distributions (whether paid in cash or additional Fund shares) or
from the proceeds of the redemption of Fund shares to the extent that dividend
and capital gain distributions are insufficient. This charge is to reimburse the
Sponsor for actual expenses incurred by the Sponsor in performing certain
administrative duties, as described under "Sponsor and Underwriter." (See the
Plan's Statement of Operations for Delegated Service Fees.) Some administrative
services are performed by the Fund at no expense to shareholders.

<PAGE>

The foregoing fees mentioned for bookkeeping and administrative services
and for specific services are paid, as are the maintenance and custodian service
fees deducted from periodic payments, to the Sponsor as reasonable compensation
for the Sponsor's performing such services. The Sponsor reserves the right to
change the fees charged to Planholders.

Neither the Custodian nor the Sponsor shall be personally liable for any
taxes levied or assessed against them or either of them with respect to the Fund
shares in the custody of the Custodian, or arising from the income therefrom or
redemption or transfer thereof. Deductions may be made from time to time to pay
tax liabilities and claims therefor, and if necessary, Fund shares may be
redeemed to provide funds for the payment of such liabilities or the creation of
reserves therefor. The term "tax liability" includes not only taxes and possible
taxes but also auditing expenses and counsel fees incurred in connection
therewith.

RIGHTS AND PRIVILEGES OF PLANHOLDERS

Each Plan issued is registered in the name of the Planholder and is in the
form of an individual agreement between First Investors Corporation, as Sponsor
of the Plan, and the Planholder. The Bank of New York is appointed Custodian
under each agreement. The Custodian performs only bare custodianship functions,
while the Sponsor has assumed bookkeeping and administrative functions as set
forth under the heading "Sponsor and Underwriter." No amendment adversely
affecting outstanding Plans may be made without the Planholder's expressed
consent.

Certain optional provisions are extended to Planholders, including rights
in the following respects:

(1) DIVIDENDS AND OTHER DISTRIBUTIONS

Dividend and other distributions received by Planholders are dependent upon
the distributions made by the Fund. Dividends from the Fund's net investment
income (consisting of interest and dividends, earned discount and other income
earned on portfolio securities less expenses) are generally declared daily and
paid monthly. Unless you direct Administrative Data Management Corp. otherwise,
dividends declared by the Fund are paid in additional Fund shares at the net
asset value (without sales charge) generally determined as of the close of
business on the first business day of the following month. The Fund also
distributes substantially all of its net capital gain (the excess of net long-
term capital gain over net short-term capital loss) and net short-term capital
gain, if any, after deducting any available capital loss carryovers, with its
regular dividend at the end of the year. Unless you direct Administrative Data
Management Corp. otherwise, these distributions are paid in additional shares of
the Fund at the net asset value (without sales charge) generally determined as
of the close of business on the business day immediately following the record
date of the distribution. Dividends and other distributions paid in Fund
shares are added to your Plan account.

In order to be eligible to receive a dividend or other distribution, you
must own Fund shares as of the close of business on the record date of the
distribution. You may elect to receive dividends and/or other distributions in
cash by notifying Administrative Data Management Corp. by telephone or in
writing prior to the record date. If you elect this form of payment, the
payment date generally is two weeks following the record date of any such
distribution. Your election remains in effect until

<PAGE>

you revoke it. Reference is made to the Fund's Prospectus for additional
information as to the payment of dividends and capital gain distributions by the
Fund.

(2) DECLARATION OF TRUST

A Planholder may, without transferring his or her Plan, execute and file
with the Sponsor from time to time revocable Declarations of Trust in a form
acceptable to the Sponsor, declaring that the Plan and the Fund shares held
thereunder are held in trust for the benefit of the person or persons named in
such Declaration of Trust upon the terms therein stated.

(3) PARTIAL LIQUIDATION WITHOUT TERMINATION

After making 20 payments or the equivalent thereof on a Periodic Payment
Plan, a Planholder may at any time withdraw a portion of the Fund shares in his
or her Plan account without terminating the Plan. In addition, if six months or
more have elapsed from the date of a substantial prepayment on a Periodic
Payment Plan (at least equal to initial payments 1-13), a Planholder may at any
time redeem a portion of the Fund shares in his or her account without
terminating the Plan. The liquidation must be for at least $50 and cannot be in
excess of 80% of the value of the Planholder's account. The proceeds of the
redemption of Fund shares or the Fund share certificate will be mailed to the
Planholder or designee of the Planholder. Requests for partial liquidations must
be in writing as more fully described under "Method of Selling Shares." Where a
partial liquidation has been effected through the redemption of Fund shares, the
Planholder may reinvest in an amount equal to the proceeds of such redemption by
sending a check payable to The Bank of New York, Custodian, c/o First Investors
Corporation, 10 Woodbridge Center Drive, Woodbridge, New Jersey 07095,
Attention: New Accounts. Such funds will be applied to the purchase of Fund
shares at a net asset value based on the next price computation and held under
the Planholder's account. The number of Fund shares may be more or less than the
amount redeemed due to the purchase price in effect at the time the reinvestment
is made. Where a partial liquidation has been effected through the withdrawal of
Fund shares, rather than the redemption, such shares may at any time be replaced
by redepositing the share certificate with the Custodian c/o First Investors
Corporation, 10 Woodbridge Center Drive, Woodbridge, NJ 07095. (There is a fee,
currently $2.25, for each partial liquidation or reinvestment.) Reinvestment of
such partial liquidation will be made only upon written request of the
Planholder accompanied by the appropriate payment. The partial liquidation and
reinvestment privilege is intended to facilitate the temporary use for emergency
purposes of funds invested in a Plan. If a Planholder realizes a gain on
liquidation, such gain is taxable for Federal income tax purposes even though
all of such proceeds are reinvested.

(4) TRANSFER OR ASSIGNMENT

A Planholder may (a) assign his or her Plan and the Fund shares held
thereunder to a bank or loan institution as security for a loan; or (b) transfer
and assign his or her Plan and Fund shares to another person, in the form and
manner acceptable to the Sponsor. If assignment is made without consent of the
Sponsor it will not be recorded on the records of the Plan. (There is a fee,
currently $2.25, for each assignment or transfer.)

<PAGE>

(5) COMPLETE WITHDRAWAL AND TERMINATION

A Planholder may, at any time, terminate his or her Plan by surrendering
the Plan Certificate and other required documents, where applicable, to
Administrative Data Management Corp., 10 Woodbridge Center Drive, Woodbridge,
New Jersey 07095, Attention: Liquidation Dept. and may request delivery of the
Fund shares accumulated, registered in his or her name, or request their
redemption and remittance to the Planholder of the proceeds of such redemption.
(There is a fee, currently $2.25, for withdrawal or liquidation prior to
completion of Periodic Payment Plans or before expiration of ten years for
Single Payment Plans.) Requests for termination and complete liquidation or
withdrawal must be in writing. Please refer to "Method of Selling Shares" for
instructions on making a complete withdrawal or termination. Any adjustment in
sales or other charges occasioned by virtue of termination by the Planholder
through the exercise of the refund privileges (see "Refund Privileges") will be
made at the same time. The redemption price is the net asset value of Fund
shares effective after receipt of the request in "good order" by Administrative
Data Management Corp., 10 Woodbridge Center Drive, Woodbridge, New Jersey 07095.

(6) REPORTS, RECEIPTS AND NOTICES

The Sponsor will mail to each Periodic Payment Planholder a receipt of each
payment, including a statement of the number of shares held for his or her
account, and notices of payments due in advance of their due date. The
Planholder will also be sent audited annual reports of the Fund, distribution
notices and tax statements relating to the Plan (TIN 13-3331632), and at least
annually a current Fund Prospectus if a Plan payment has been made during the
calendar year.

(7) VOTING RIGHTS

The Planholder will be sent notice of any meeting at which his or her Fund
shares may be voted and will be sent voting instruction forms. The Sponsor will
cause the Custodian to vote any Planholder's shares in accordance with the
Planholder's instructions, or if the Planholder so requests, to give him or her
a proxy or otherwise arrange for his or her exercise of voting rights at any
meeting. If the Planholder does not exercise any of the above privileges, the
Sponsor will cause the Custodian to vote his or her Fund shares for or against
each matter on which the Planholder is entitled to vote, in the same proportion
as indicated in the voting instructions given the Custodian on behalf of other
Planholders.

(8) PREPAYMENT

Planholders of Periodic Payment Plans may accelerate completion of a Plan
by making full or partial payments in advance of their due dates. Such
prepayments do not in any way accelerate the due dates of unpaid payments.
Unpaid payments will be considered to be due on that date on which they would
have originally been required if all prior payments (whether or not in fact made
in advance) had been made when they were respectively due. In the event the
Planholder makes a payment aggregating twelve or more monthly payments, the
deductions therefrom for maintenance and custodian fees will be reduced by 50%
of the scheduled fees. A Planholder considering advance payments should keep in
mind that direct purchases of Fund shares enable the investor to put more of his
or her money to work immediately and over the life of a Fund account than would
be possible under the life of the Plan offered hereby.

<PAGE>

(9) REFUND PRIVILEGES

Within 60 days after the issuance of the Plan Certificate, Planholders of
Periodic Payment Plans will receive a statement of charges to be deducted from
the projected Plan payments and a notice of his or her right to withdraw from
the Plan. Planholders electing to exercise this right of withdrawal will receive
a full refund of all charges deducted from payments made plus the net asset
value of Fund shares accumulated in his or her Plan account, provided the
Planholder surrenders his or her Plan Certificate to the Sponsor, First
Investors Corporation, 10 Woodbridge Center Drive, Woodbridge, New Jersey 07095,
so that it is received within 45 days after the mailing to the Planholder of
such withdrawal notice. Please refer to "Method of Selling Shares" for
instructions on making requests for refunds of sales charges.

In addition, if he or she misses any three payments (which need not be
consecutive) among the first fifteen payments due under his or her Plan or any
one payment thereafter, but prior to the 18th payment, the Planholder will
receive a separate written notice informing the Planholder of (1) the right to
surrender his or her Plan Certificate, (2) the value of his or her Plan account
at the time of the mailing of the notice, and (3) the amount to which he or she
is entitled. Moreover, the Planholder has a right to request a refund of the
portion of the sales charges which exceeds 15% of the gross payments he or she
has made plus the then net asset value of the Fund shares accumulated in his or
her Plan account, provided the Planholder surrenders his or her Plan Certificate
so that it is received by the Sponsor at the address in the preceding paragraph
within 28 months of the date the Plan Certificate was issued. Planholders who
purchased a Plan after May 25, 1992 (on or after May 22, 1992 for Kentucky
Planholders) may request this refund within 28 months of the date the Plan
Certificate was issued. Planholders will be sent a notice setting forth this
refund privilege not less than 30 days and not more than 60 days prior to the
expiration of the Planholder's right to receive this refund.

(10) COMPLETION OF PLAN

Upon completion of all Plan payments, the Planholder may elect to terminate
the Plan or have the Fund shares accumulated under the Plan held in his or her
Plan account.

A Planholder who elects to terminate the Plan account may either receive
the proceeds from the redemption of the Fund shares held in his or her account
or transfer those shares to a Fund account. Reference is made to "Method of
Selling Shares" for instructions on how to terminate a Plan. Planholders who
elect to receive the proceeds from the redemption of Fund shares will realize a
gain or loss for Federal income tax purposes.

As soon as possible after the close of each calendar year, the Planholder
will be advised of the amount and nature of the distributions declared on his or
her behalf during such year. Planholders who elect to have their investment
remain in their Plan account may make no more payments or contributions into the
account. Dividend and capital gain distributions will continue to be paid on the
Fund shares held in the Planholder's account and annual maintenance and
custodian fees will continue to be deducted from the Planholder's account.

<PAGE>

METHOD OF SELLING SHARES

A Planholder may, by written request filed with the Sponsor, direct the
redemption of some but not all of the Fund shares credited to his or her Plan
account or, upon surrender of the Plan Certificate, terminate the Plan and
direct the redemption of all of his or her shares. The Sponsor will cause
payment to be made by check within seven days after the written request for
liquidation or termination "in good order" is received by Administrative Data
Management Corp. Requests for liquidation or termination should be addressed to
Administrative Data Management Corp., 10 Woodbridge Center Drive, Woodbridge,
New Jersey 07095-1198, Attention: Liquidation Department. "Good order" means
that the request for liquidation or termination must include:

(1) a letter of instruction specifying the account number and the number
of Fund shares or dollar amount to be redeemed. This request must be signed by
all registered Planholder(s) in the exact name(s) in which the account is
registered;

(2) required signature guarantees (see below);

(3) in the case of termination requests only, the Plan Certificate, if one
was issued; and

(4) other supporting legal documents, as required by Administrative Data
Management Corp. In the case of estates, trusts, guardianships, custodianships,
corporations, partnerships or other organizations, additional information may be
required, which may be obtained by calling Administrative Data Management Corp.
at 1-800-423-4026.

If the proceeds of the redemption are more than $50,000 or if the check is
made payable to someone other than the registered Planholder(s) or mailed to an
address other than the address of record, or if the address of record has
changed within the past 60 days, a signature guarantee will be required. In
order to avoid any possible delay in processing a transaction, Planholders are
advised to submit liquidation or termination requests with signature guarantees.

SIGNATURE GUARANTEES. A signature guarantee is designed to protect you,
the Plan and the Sponsor. Members of STAMP (Securities Transfer Agents
Medallion Program), MSP (New York Stock Exchange Medallion Signature Program)
and SEMP (Stock Exchanges Medallion Program) are eligible signature guarantors.
A notary public is not an acceptable guarantor. The guarantee must be manually
signed by an authorized signatory of the guarantor and the words "Signature
Guaranteed" must appear in direct association with such signature. Although the
Sponsor reserves the right to require signature guarantees at any other time,
signature guarantees are required whenever: (1) the amount of the redemption is
$50,000 or more, (2) a redemption check is to be made payable to someone other
than the registered Planholder, (3) a redemption check is to be mailed to an
address other than the address of record, (4) an account registration is being
transferred to another owner, (5) a Plan account, other than an individual,
joint, UGMA or UTMA nonretirement Plan account, is being exchanged or redeemed,
(6) the redemption request is for certificated shares, or (7) your address of
record has changed within 60 days prior to a redemption or exchange request.

The redemption price of Fund shares will be the net asset value per share
next determined after receipt by Administrative Data Management Corp. of the
request "in good order," as noted above. To the extent that there are offsetting
new purchases on the same day for the accounts of other Planholders, redemptions
will be netted against those purchases. If, on any business day, there are

<PAGE>

more shares offered for redemption than required for new purchases, the excess
will be presented to the Fund for redemption or repurchase at the next
determined net asset value. The right to receive cash, however, may be suspended
during any period when the Fund shall have suspended the right to redeem its
shares. The Board of Directors of the Fund may suspend the right of redemption
or postpone the date of payment during any period when (a) trading on the New
York Stock Exchange ("NYSE") is restricted as determined by the Securities and
Exchange Commission or such Exchange is closed for other than weekends and
holidays, (b) the Securities and Exchange Commission has by order permitted such
suspensions, or (c) an emergency, as defined by rules of the Commission, exists
during which time the sale of portfolio securities or valuation of securities
held by the Fund are not reasonably practicable. For additional information
regarding redemption rights and suspension thereof refer to the Prospectus of
the Fund.

TERMINATION OF PLAN BY THE SPONSOR

Either the Sponsor or the Custodian may, but is not required to, terminate
a Plan as hereinafter provided, after:

a) the expiration of 20 years from the date of inception of a Periodic
Payment Plan providing for 120 payments over 10 years; or

b) the expiration of 25 years from the date of inception of a Periodic
Payment Plan providing for 180 payments over 15 years.

If a Planholder fails to make a Plan payment on or before the due date, he
or she will be considered in default. Should any Planholder continue in default
for a period of two years or more, the Sponsor may terminate his or her Plan as
hereinafter provided. As a matter of policy the power to terminate because of
default will usually be exercised only when the default has continued over a
comparatively long period and the dividend and capital gain distributions on the
Fund shares are insufficient to cover maintenance and custodian charges.

If the Sponsor or the Custodian shall determine to exercise its right to
terminate any Plan for the reasons noted above, the Sponsor will mail to the
Planholder at his or her address noted on its records a notice of termination.
Within 60 days of the date of such notice of termination, the Planholder must
surrender the Plan Certificate to the Sponsor and elect to receive either: (a) a
share certificate for the amount of full Fund shares and the proceeds of any
fractional Fund share accumulated in his or her Plan account or; (b) the
proceeds from the redemption of all Fund shares in the account. If the
Planholder fails to so elect, the Sponsor may, without further notice, either:
(a) cause the issuance of a share certificate in the Planholder's name for the
amount of full Fund shares accumulated in his or her Plan account and the
redemption of any fractional Fund share; or (b) cause the redemption of all Fund
shares in the Plan account. The Sponsor will hold the share certificate or the
net proceeds from the redemption of Fund shares for delivery or payment to the
Planholder upon surrender of the Plan Certificate. If the Planholder does not
surrender his or her Plan Certificate after an additional 60 days, the Sponsor
may, without receiving a Plan Certificate, mail to the Planholder at his or her
address noted on its records either: (a) a share certificate for the amount of
full Fund shares and a check for the fractional Fund share; or (b) a check
representing the net proceeds of the redemption of all Fund shares in the Plan
account. Reference is made to the Fund's Prospectus for the method of redeeming
share certificates. Planholders who elect to receive

<PAGE>

the proceeds from the redemption of Fund shares will realize a gain or loss for
Federal income tax purposes.

Furthermore, a Planholder who does not make the regularly scheduled second
payment within a period of 60 days after it becomes due shall be considered in
default. In such event, the Sponsor reserves the right to terminate the Plan by
giving the Planholder written notice and refunding the entire initial payment,
less deductions, upon surrender of the Plan Certificate.

Reference is made to "Other Deductions" relative to charges made after
completion of ten or fifteen years or in cases of default. Such deductions that
cannot be satisfied from distributions available will be made from the
redemption of Fund shares held in the Planholder's account.

No interest will be payable on funds held for Planholders pending surrender
of Plan Certificates. Any assets undelivered to the Planholder shall be held by
the Custodian in custody, subject to disposition under applicable state law.

Any notice required or permitted to be given to the Planholder shall be
conclusively deemed to have been given when such notice is enclosed in an
envelope, addressed to the Planholder at the Planholder's address, as noted on
the records, and deposited in the United States Mail, postage prepaid. The date
of the mailing of such notice shall be deemed to be the date of giving such
notice.

EXCHANGES INVOLVING OTHER PLANS

You may exchange at relative net asset value of the underlying Fund shares
into or from any other single or periodic payment plan of the same type and
denomination for which FIC is the Sponsor without paying an additional sales
charge. If a Planholder elects to exercise this exchange privilege, he or she
pays the same sales charge on additional payments, and has the same rights and
privileges, under the new plan as under the current plan. Exchanges can only be
made into accounts registered to identical owners. If your exchange is into a
new account, it must meet the minimum investment and other requirements of the
plan into which the exchange is being made. Additionally, the plan must be
available for sale in the state where you reside. A $10.00 exchange fee is
charged for each such exchange. In addition, the $2.25 redemption fee
applicable to Plan liquidations (see "Other Deductions") is charged for each
exchange.

Before exchanging your Plan, you should read the Prospectus for the new
plan and the Prospectus for its underlying Fund investment into which the
exchange is to be made. You may obtain these Prospectuses and information with
respect to which plans qualify for the exchange privilege free of charge by
calling Shareholder Services at 1-800-423-4026. Exchange requests received in
"good order" by Administrative Data Management Corp., 10 Woodbridge Center
Drive, Woodbridge, New Jersey 07095 before the close of regular trading on the
NYSE, generally 4:00 P.M. (New York City time), will be processed at the net
asset value of the underlying Fund shares determined as of the close of regular
trading on the NYSE on that day; exchange requests received after that time will
be processed on the following trading day.

Exchanges should be made for investment purposes only. A pattern of
frequent exchanges may be contrary to the best interests of a Fund's other
shareholders. Accordingly, the Sponsor has the right, at its sole discretion,
to limit the amount of an exchange, impose a holding period, reject any
exchange, or, upon 60 days' notice, materially modify or discontinue the
exchange privilege. The

<PAGE>

Sponsor in consultation with a Fund's Investment Adviser, will consider all
relevant factors in determining whether a particular frequency of exchanges is
contrary to the best interests of a Fund and its other shareholders. Any such
restriction will be made by the Sponsor on a prospective basis only, upon notice
to the Planholder not later than ten days following such Planholder's most
recent exchange.

An exchange between plans will result in a taxable gain or loss to you,
depending on whether the redemption proceeds from the underlying Fund shares are
more or less than your adjusted basis for the Plan (which normally includes the
sales charges paid under the Plan). Please refer to "Taxes" and the Fund's
Prospectus.

SUBSTITUTION OF OTHER SHARES AS
THE UNDERLYING INVESTMENT OF THE PLAN

Subject to prior approval of the Securities and Exchange Commission, the
Sponsor may, whenever the Sponsor deems it to be in the best interest of the
Planholders, substitute other shares as the underlying investment of the Plans.
Such substitution may include shares previously purchased or may affect only
shares to be purchased. Shares to be substituted must be generally comparable to
the shares previously purchasable under the Plans and as a matter of policy will
be limited to shares registered with the Securities and Exchange Commission.
Before any substitution may be made by the Sponsor it shall:

(1) Apply for and receive prior approval from the Securities and Exchange
Commission permitting such substitution under the provisions of Section 26(b) of
the Investment Company Act of 1940, as amended;

(2) Notify the Custodian of the proposed substitution;

(3) Give written notice of the proposed substitution to the Planholders,
describing the new shares and notifying them that unless they surrender their
Plan Certificates to the Sponsor for termination within 30 days, they will be
conclusively deemed to have authorized the substitution; and

(4) In the case of substitution of new shares for shares previously
purchased, furnish new shares which have an aggregate net asset value at least
equal to the aggregate value of the shares previously purchased, based on their
published or quoted bid price.

Unless the Sponsor shall receive from the Planholder, within 30 days from
the date of the Sponsor's notice, written notice that he or she desires to make
a complete withdrawal, the Sponsor is authorized to cause the purchase of new
shares and, if the old shares are to be exchanged, to exchange the old shares
for the substituted shares.

In the event of substitution the Planholder is required to be advised in
writing within 5 days after such substitution is made. Any expenses and charges
involved in such substitution, other than proper transfer taxes and charges,
will be borne by the Sponsor.

<PAGE>

In the event that shares used as the underlying investment of the Plan may
not be purchasable for a period of 90 days, and if the Sponsor does not
substitute other shares, it is agreed that the Plan will be terminated, and the
Sponsor is authorized to complete such termination.

SPONSOR AND UNDERWRITER

First Investors Corporation (TIN 13-2608328), 95 Wall Street, New York,
N.Y., 10005, was organized under the laws of the State of New York in
February 1968. It is a member of the National Association of Securities Dealers,
Inc. First Investors Corporation is the Sponsor and the Underwriter of the Plan.
The Plan is offered for sale by registered representatives of the Underwriter.

First Investors Corporation also acts as the Sponsor and Underwriter of
Periodic and/or Single Payment Plans for the accumulation of shares of First
Investors Global Fund, Inc., First Investors Fund For Income, Inc., First
Investors Government Fund Inc., and First Investors Insured Tax Exempt Fund,
Inc. and as underwriter for the First Investors family of mutual funds.

First Investors Consolidated Corporation owns all of the outstanding stock
of First Investors Corporation and Administrative Data Management Corp. and all
of the outstanding voting common stock of First Investors Management Company,
Inc., the investment adviser of the Fund. Mrs. Julie W. Grayson (as executrix of
the estate of her deceased husband, David D. Grayson) and Mr. Glenn O. Head (or
members of his family) are controlling persons of First Investors Consolidated
Corporation and therefore, jointly control First Investors Management Company,
Inc., the investment adviser of the Fund.

The Sponsor and its administrative agent, Administrative Data Management
Corp., a subsidiary of First Investors Consolidated Corporation, the Sponsor's
parent organization, are responsible for the performance of all regular
bookkeeping and administrative services with respect to the Plans, as more fully
set forth below. In addition, the Sponsor is responsible for the performance of
certain special administrative services, specifically: causing the mailing to
Planholders of prospectuses, when applicable, annual and semiannual reports of
the Fund, and required dividend and tax notices; and causing an independent
quarterly audit of the records of the Custodian and the preparation and filing
of required tax returns. The Sponsor receives all of the maintenance and
custodian fees deducted from payments or imposed on an annual basis as set forth
on pages 2 through 4 and all of the fees for specific services as set forth
under "Other Deductions." For the year ended December 31, 1994, these fees
amounted to $114,722, all of which were paid to Administrative Data Management
Corp.

In general, and without limitation, the bookkeeping and administrative
services assumed by the Sponsor and Administrative Data Management Corp. are
comprised of the maintenance of all records relating to the Planholders and
their accumulated Fund shares, the processing of payments from Planholders, the
processing of proceeds to withdrawing or terminating Planholders, the placement
of orders with the underwriter of the Fund's shares for the purchase and
redemption of Fund shares on behalf of the Planholders, the calculation of the
number of shares to be purchased or redeemed or credited as dividend or capital
gain distributions, the causing of the mailing of all required notices and other
information to Planholders and the handling of all contact and correspondence
with and inquiries from Planholders.

<PAGE>

First Investors Corporation paid its three highest paid officers aggregate
compensation from salaries or commissions of $1,264,803 during 1994. The
aggregate remuneration paid to all other officers during 1994 was $1,309,106.
Compensation of sales officers, sales supervisory personnel and registered
representatives totaled $25,208,439 while administrative personnel excluding
officers received $8,037,902 during 1994. The aggregate directors fees paid in
1994 totalled $22,500.

A blanket fidelity bond in an amount of $5,000,000 is carried with Gulf
Insurance Group covering the acts of Directors, Officers, Employees and Sales
Personnel of the Sponsor; an excess blanket fidelity bond in an amount of
$20,000,000 is carried with the ICI Mutual Insurance Company, covering the acts
of Directors, Officers and Employees of the Sponsor. The Sponsor also maintains
$30,000,000 in Directors & Officers/Employees & Officers coverage.

REGULATORY MATTERS. In June 1992, the Funds' underwriter FIC, entered into
a settlement with the SEC to resolve allegations by the agency that certain of
FIC's sales representatives had made misrepresentations concerning the risks of
investing in two high yield bond funds, the First Investors Fund For Income,
Inc. and the First Investors High Yield Fund, Inc. ("High Yield Funds"), and had
sold these Funds to investors for whom they were not suitable. Without
admitting or denying the SEC's allegations, FIC: (a) consented to the entry of a
final judgment enjoining it from violating Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5 thereunder and Section 17(a) of the 1933
Act; (b) agreed to the entry of an administrative order censuring it and
requiring it to comply with undertakings to improve its policies and procedures
with regard to sales, training, supervision and compliance; and (c) agreed to
pay $24.7 million to certain investors who purchased shares of the High Yield
Funds from in or about November 1984 to in or about November 1990.

FIC, FIMCO and/or certain affiliated entities and persons have entered into
settlements with regulators in 29 states to resolve allegations, similar to
those made by the SEC, concerning sales of the High Yield Funds. In October
1993, as part of settlements with Maine, Massachusetts, New York, Virginia and
Washington ("State Settlements"), FIC, FIMCO and certain affiliated entities
and persons agreed, without admitting or denying any of the allegations, (a) to
be enjoined from violating certain provisions of the state securities laws, (b)
to engage in remedial measures designed to ensure that proper sales practices
are observed in the future, and (c) to pay $7.5 million, in addition to the
$24.7 million previously paid by FIC in connection with the SEC settlement, to
investors in the High Yield Funds. In addition, as part of those settlements,
several FIC executives, including Glenn O. Head, who is an officer and director
of the Funds, agreed to be suspended and enjoined temporarily from associating
with any broker-dealer in a supervisory capacity in certain of the states. On
December 8, 1993, several present and former FIC executives, including Mr. Head,
also agreed, without admitting or denying the allegations, to temporary SEC
suspensions from associating with broker-dealers and in some cases other
regulated entities in a supervisory capacity.

CUSTODIAN

The Bank of New York (TIN 13-4941102), 48 Wall Street, New York, N.Y.,
10286, acts as Custodian under the Custodian Agreement dated March 12, 1985.
The Custodian is subject to supervision by the New York State Banking
Commission. The duties of the Custodian under the provisions of the Custodian
Agreement are those of bare custodianship. The Custodian holds all securities,
cash, checks and other property in which the funds of the Planholders are
invested or are to be invested, all funds held for such investment, all
redemption proceeds, and other special funds of the Planholders, and all income
upon, accretions to, and proceeds of such property and funds to

<PAGE>

the extent such assets are delivered to it. All such assets are held subject to
such disbursements as the Sponsor may direct and subject to a charge for the
fees of the Custodian. The Sponsor directs the Custodian to make disbursements
in accordance with the provisions of the Plan.

The Custodian assumes no duties or obligations not specifically imposed
upon it by the Plan. Without limiting the generality of the foregoing, the
Custodian assumes no responsibility for the choice of the investment, the
investment policies of the investment adviser to the Fund, or for any acts or
omissions on the part of the Sponsor. The Custodian specifically does not assume
the duties of investment ordinarily imposed upon a trustee, and its only
obligations are, as set forth above, to function as bare Custodian under the
Plan. The Custodian may not resign its custodianship under the Plan unless the
Plan has been terminated or unless a successor Custodian has been designated and
has accepted the custodianship.

The Custodian shall have a lien upon the Fund shares held for Planholders
and the proceeds from any redemption thereof for its fees and reimbursable
expenses to the extent that payments by the Planholder and distributions
received on such Fund shares may be insufficient to pay the same. For the fiscal
year ended December 31, 1994, there were no fees paid to the Custodian for
services rendered on behalf of the Plans.

TAXES

The Fund has qualified and intends to continue to qualify for treatment as
a regulated investment company under the Code so that it will be relieved of
Federal income tax on that part of its investment company taxable income
(consisting generally of net investment income, net short-term capital gain and
net gains from certain foreign currency transactions) and net capital gain that
is distributed to its shareholders.

Dividends paid from investment company taxable income are taxable to you as
ordinary income, whether paid in cash or in additional shares. Distributions of
net capital gain, when designated as such, are taxable to you as long-term
capital gain, whether paid in cash or in additional shares, regardless of the
length of time you have owned your shares. If you purchase shares shortly
before the record date for a dividend or other distribution, you will pay full
price for the shares and receive some portion of the price back as a taxable
distribution. You will receive an annual statement following the end of each
calendar year describing the tax status of distributions paid by the Fund during
that year.

The Sponsor is required to withhold 31% of all dividends, capital gain
distributions and redemption proceeds payable to you (if you are an individual
or certain other non-corporate shareholder) if the Sponsor is not furnished with
a correct taxpayer identification number, and in certain other circumstances.

If you itemize deductions for Federal income tax purposes, you may deduct
maintenance and custodian fees deducted from payments and/or dividend and
capital gain distributions only if the requirements applicable to the
deductibility of "miscellaneous itemized deductions" are satisfied (including
the requirement that they, together with other miscellaneous itemized
deductions, exceed 2% of adjusted gross income). The sales charges paid in
acquiring your Plan should be included for tax purposes in the cost of the Plan
and reinvested dividends or distributions.

<PAGE>

The foregoing is only a summary of some of the important Federal tax
considerations generally affecting the Plan and its shareholders; see the Funds'
Prospectus and Statement of Additional Information for a further discussion.
There may be other Federal, state or local tax considerations applicable to a
particular investor. You therefore are urged to consult your own tax advisor.

OFFICERS AND DIRECTORS OF FIRST INVESTORS CORPORATION

The following sets forth the officers and directors of First Investors
Corporation as well as information as to their other affiliations:

GLENN O. HEAD
CHAIRMAN OF THE BOARD AND DIRECTOR, 95 Wall Street, New York, NY 10005.
Chairman of the Board and Director of First Investors Management Company,
Inc. and First Investors Consolidated Corporation, Chairman of the Board,
Director and Treasurer of Administrative Data Management Corp., and an
officer and/or director of other affiliated companies of First Investors
Corporation as well as the investment companies of the First Investors
Group.

MARVIN HECKER
PRESIDENT, 95 Wall Street, New York, NY 10005. Prior to March 1995 First
Vice President, Executive Sales. Prior to March 1991, in First Investors
Corporation's Seminar Complex, New Jersey office.

LAWRENCE A. FAUCI
SENIOR VICE PRESIDENT AND DIRECTOR, 95 Wall Street, New York, NY 10005.
Senior Vice President of First Investors Consolidated Corporation.

LOUIS RINALDI
SENIOR VICE PRESIDENT, 10 Woodbridge Center Drive, Woodbridge, NJ 07095.
Senior Vice President of Administrative Data Management Corp.

KATHRYN S. HEAD
VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND DIRECTOR, 10 Woodbridge Center
Drive, Woodbridge, NJ 07095. President of First Investors Consolidated
Corporation and First Investors Management Company, Inc., President and
Director of First Financial Savings Bank, S.L.A., Chief Financial Officer
of Administrative Data Management Corp. and an officer and/or director of
other affiliated companies of First Investors Corporation as well as the
investment companies of the First Investors Group.

JOHN T. SULLIVAN
DIRECTOR, 95 Wall Street, New York, NY 10005. Director of First Investors
Management Company, Inc., First Investors Consolidated Corporation and
Administrative Data Management Corp. and an officer and/or director of
other affiliated companies of First Investors Corporation as well as the
investment companies of the First Investors Group.

<PAGE>

ROGER L. GRAYSON
DIRECTOR, 95 Wall Street, New York, NY 10005. President and Director,
First Investors Resources. A commodities portfolio manager. A director of
the investment companies of the First Investors Group.

JEREMY J. LYONS
DIRECTOR, 56 Weston Avenue, Chatham, NJ 07928. Publisher, Springer-Verlag
Inc. (publishing), New York, NY. Prior to September 1993, with W.H. Freeman
& Co. (publishing), New York, NY.

MARY JANE KRUZAN
DIRECTOR, 15 Norwood Avenue, Summit, NJ 07901. Corresponding Secretary of
charitable organization.

ANNE CONDON
VICE PRESIDENT, 10 Woodbridge Center Drive, Woodbridge, NJ 07095. Senior
Vice President of Administrative Data Management Corp.

FREDERICK MILLER
VICE PRESIDENT, 10 Woodbridge Center Drive, Woodbridge, NJ 07095. Senior
Vice President of Administrative Data Management Corp.

MATTHEW SMITH
VICE PRESIDENT, 10 Woodbridge Center Drive, Woodbridge, NJ 07095.

LARRY R. LAVOIE
SECRETARY AND GENERAL COUNSEL, 95 Wall Street, New York, NY 10005. Officer
of certain affiliated companies of First Investors Corporation. Prior to
March 1993, a partner in the law firm of Kirkpatrick & Lockhart.

JOSEPH I. BENEDEK
TREASURER, 10 Woodbridge Center Drive, Woodbridge, NJ 07095. Officer of
other affiliated companies of First Investors Corporation as well as the
investment companies of the First Investors Group.

OTHER OFFICERS
Concetta Durso, Assistant Vice President and Assistant Secretary
Gary Abbott, Assistant Vice President
Philip Adriani, Jr., Assistant Vice President
Randy Pagan, Assistant Vice President
Mark Segal, Assistant Vice President
Iris Goldberg, Assistant Vice President
Elizabeth Reilly, Assistant Vice President
Robert Murphy, Assistant Treasurer
Carol Lerner Brown, Assistant Secretary
Carl Tomik, Assistant Secretary
Frank Williams, Assistant Secretary

<PAGE>

SALES OFFICERS

ALVIN BLUMENFELD, Senior Vice President. . . . . . .Scarsdale Division Executive
HOWARD FROMAN, Senior Vice President . . . . . . . .Scarsdale Division Executive
MYRON FELTHEIMER, Senior Vice President. . . . . . . . . . . .Penn Plaza Complex
GEORGE KECHEJIAN, Senior Vice President. . . . . . . . . . . . .Hartford Complex
Thomas Barden, Regional Vice President . . . . . . . . . . . . .Executive Office
Richard Nadeau, Vice President . . . . . . . . . . . . . . . . .Executive Office
John Cupo, Vice President. . . . . . . . . . . . . .Scarsdale Division Executive

SALES OFFICE STATE

Robert J. Rundback, Senior Vice President. . . . . . . . . .North Jersey NJ
Bruce Cobey, Regional Vice President . . . . . . . . . . .Albany Complex NY
John Murphy, Regional Vice President . . . . . . . . . . . . Springfield MA

Sam Agust, Vice President. . . . . . . . . . . . . . . . . . . Lexington NY
John Bucsek, Vice President. . . . . . . . . . . . Grand Central Complex NY
Paul Caccomo, Vice President . . . . . . . . . . . . . . . . . . Detroit MI
Conrad Charak, Vice President. . . . . . . . . . . . .Penn Plaza Complex NY
Avra L. Cohn, Vice President . . . . . . . . . . . . . . . . . . .Skokie IL
Denis Collins, Vice President. . . . . . . . . . . . . . . . New Orleans LA
Richard Di Paolo, Vice President . . . . . . . . . . . . . . . .Columbus OH
Steve Domenitz, Vice President . . . . . . . . . . . . . . .Philadelphia PA
Benn Feltheimer, Vice President. . . . . . . . . . . .Penn Plaza Complex NY
Ben N. Gardner, Vice President . . . . . . . . . . . . . . . Wall Street NY
John Golden, Vice President. . . . . . . . . . . . . . . . . Garden City NY
Gus Graff, Vice President. . . . . . . . . . . . . . . . . . .Huntington NY
James Hoysick, Vice President. . . . . . . . . . . . . . . . . . .Denver CO
Bruce Katz, Vice President . . . . . . . . . . . . . . . . . . . . Miami FL
Brian Kennedy, Vice President. . . . . . . . . . . . . . . . . Cleveland OH
Andrew Levenson, Vice President. . . . . . . . . . . . . . .Boston South MA
Milton Levy, Vice President. . . . . . . . . . . . . . . . . .Penn Plaza NY
Steve Manning, Vice President. . . . . . . . . . . . . . . . .Lauderhill FL
Mary McConnell, Vice President . . . . . . . . . . . . . . . .Tudor City NY
Loren P. Morse, Vice President . . . . . . . . . . . . . . . .Binghamton NY
Jim Morton, Vice President . . . . . . . . . . . . . . . . . . . Chicago IL
Fred Nero, Vice President. . . . . . . . . . . . . . . . . . . . .Albany NY
Jerry Nettuno, Vice President. . . . . . . . . . . . . . . . Winter Park FL
Paul Prete, Vice President . . . . . . . . . . . . . . . . . . New Haven CT
James Reilly, Vice President . . . . . . . . . . . . . . . .Jersey Shore NJ
Richard C. Risley, Vice President. . . . . . . . . . . . . . . .Hartford CT
Ronald Rovelli, Vice President . . . . . . . . . . . . . . . . . Norfolk VA
Stuart Rudnick, Vice President . . . . . . . . . . . . Scarsdale Complex NY
Richard Rustic, Vice President . . . . . . . . . . . . . . . . .Hartford CT
Malvin S. Scherr, Vice President . . . . . . . . . . . . . . Los Angeles CA

<PAGE>

SALES OFFICE STATE

Stephen Sheron, Vice President . . . . . . . . . . . . . . . . .Elmsford NY
Jay Stainsby, Vice President . . . . . . . . . . . . . . Buffalo Complex NY
Richard Starace, Vice President. . . . . . . . . . . . . . . . . . Bronx NY
Sal Talamo, Vice President . . . . . . . . . . . . . . . . .Indianapolis IN
Norman Wigutow, Vice President . . . . . . . . . . . . . . . .Washington DC
Frank Williams, Vice President . . . . . . . . . . . . . . . Wall Street NY
Max Zwiebel, Vice President. . . . . . . . . . . . . . . . . .Penn Plaza NY

Frank Cimino, Senior Resident Vice President . . . . . . .Central Jersey NJ
Philip J. Franco, Senior Resident Vice President . . . . .Central Jersey NJ
Albert Gallo, Senior Resident Vice President . . . . . . . . .Penn Plaza NY
Peter Kulas, Senior Resident Vice President. . . . . . . .Central Jersey NJ
Perry Moskowitz, Senior Resident Vice President. . . . . . Grand Central NY
Richard Paul, Senior Resident Vice President . . . . . . .Central Jersey NJ
Edmund Reichard, Senior Resident Vice President. . . . . . . Wall Street NY
Buddy Schiff, Senior Resident Vice President . . . . . . . . Garden City NY
Jack Tuck, Senior Resident Vice President. . . . . . . . . . .Lauderhill FL
Frank Cimino, Senior Resident Vice President . . . . . . .Central Jersey NJ

Garrett Cutler, Resident Vice President. . . . . . . . . . Grand Central NY
Sunny Ensley, Resident Vice President. . . . . . . . . . . . .Penn Plaza NY
Milton Fried, Resident Vice President. . . . . . . . . . . . . Lexington NY
Christine D. Froman, Resident Vice President . . . . . . . . . .Elmsford NY
Sal Gallo, Resident Vice President . . . . . . . . . . . . . .Penn Plaza NY
Peter Hesbacher, Resident Vice President . . . . . . . . . .Jersey Shore NJ
Pete Kulas, Resident Vice President. . . . . . . . . . . .Central Jersey NJ
Lou Lombardi, Resident Vice President. . . . . . . . . . . Grand Central NY
Walter Markowitz, Resident Vice President. . . . . . . . . Grand Central NY
Hy Morgenstein, Resident Vice President. . . . . . . . . . . . Lexington NY
Alvin Person, Resident Vice President. . . . . . . . . . . . .Penn Plaza NY
Henia Reiser, Resident Vice President. . . . . . . . . . . . .Penn Plaza NY
Frank Sautner, Resident Vice President . . . . . . . . . .Central Jersey NJ
Bernard Shultz, Resident Vice President. . . . . . . . . . . .Penn Plaza NY
Harold Silvey, Resident Vice President . . . . . . . . . . Grand Central NY
Sanford Zipser, Resident Vice President. . . . . . . . . . . .Huntington NY

Dennis Burd, Associate Vice President. . . . . . . . . . . . .Pittsburgh PA
Jack Cline, Associate Vice President . . . . . . . . . . . . .Fort Worth TX
Ted Davis, Associate Vice President. . . . . . . . . . . . . . . .Albany NY
Michael Fioroni, Associate Vice President. . . . . . . . . . Springfield MA
Gregory Gelineau, Associate Vice President . . . . . . .Narragansett Bay RI
John Gentry, Associate Vice President. . . . . . . . . .Nebraska Central NE
Dino Giovannone, Associate Vice President. . . . . . . . . . . .Wheeling WV
Robert Graef, Associate Vice President . . . . . . . . . . . . New Haven CT
Ray Imbro, Associate Vice President . . . . . . . . . . . . . City Line PA
Alan Kasser, Associate Vice President. . . . . . . . . . . . . . Houston TX

<PAGE>

SALES OFFICE STATE

Christopher Kinsky, Associate Vice President . . . . . . . . Denver Lodo CO
Joy Kourkounis, Associate Vice President . . . . . . . . . . . . Buffalo NY
Stephen E. Krise, Associate Vice President . . . . . . . . . . Charlotte NC
Christopher Long, Associate Vice President . . . . . . . . . . New Haven CT
Jim Messecar, Associate Vice President . . . . . . . . . . .Jacksonville FL
Luciano Miceli, Associate Vice President . . . . . . . . . . . . Buffalo NY
Tom Morin, Associate Vice President. . . . . . . . . . . . . . .Richmond VA
Don Skelly, Associate Vice President . . . . . . . . . . . .Jacksonville FL
Timothy Smith, Associate Vice President. . . . . . . . . . . . .Newburgh NY
William Stead, Associate Vice President. . . . . . . . . . . . . Phoenix AZ
Patricia Theil, Associate Vice President . . . . . . . . . . . . .Denver CO
Howard Washburn, Associate Vice President. . . . . . . . . . . . Seattle WA

Janice Barlow, Assistant Vice President. . . . . . . . . . . . . . Tampa FL
Sandro Barone, Assistant Vice President. . . . . . . . . . . Wall Street NY
John Berry, Assistant Vice President . . . . . . . . . . . . .Washington VA
Nicholas Bollas, Assistant Vice President. . . . . . . . . .Boston North MA
Robert Bugdal, Assistant Vice President. . . . . . . . . .Central Jersey NJ
Steve Cooper, Assistant Vice President . . . . . . . . . . . . . .Tucson AZ
Paul Corapi, Assistant Vice President. . . . . . . . . . . .Jersey Shore NJ
Arthur A. Cornick, Assistant Vice President. . . . . . . . . .Lauderhill FL
Ted Davis, Assistant Vice President. . . . . . . . . . . . . . . .Albany NY
Jay Epstein, Assistant Vice President. . . . . . . . . . . . . . Buffalo NY
Robert Flood, Assistant Vice President . . . . . . . . . . . . . . Tampa FL
Judith Fryer, Assistant Vice President . . . . . . . . . . . . Lexington NY
Johnny Fu, Assistant Vice President. . . . . . . . . . . . . Wall Street NY
Jack Gardner, Assistant Vice President . . . . . . . . . . . Wall Street NY
Henry Golinski, Assistant Vice President . . . . . . . . . Grand Central NY
Herman Groen, Assistant Vice President . . . . . . . . . . . .Penn Plaza NY
William Henderson, Assistant Vice President. . . . . . . . . . . . Astro TX
Ronald W. Hoffer, Assistant Vice President . . . . . . . . .Indianapolis IN
Terry Humphries, Assistant Vice President. . . . . . . . . . New Orleans LA
Fred Johnson, Assistant Vice President . . . . . . . . . . . . . Norfolk VA
Kevin Keating, Assistant Vice President. . . . . . . . . . . . .Wheeling WV
Vincent Martucci, Assistant Vice President . . . . . . . . .North Jersey NJ
John Timothy McCue, Assistant Vice President . . . . . . . . Wall Street NY
Robert McGeorge, Assistant Vice President. . . . . . . . . . . Keeneland KY
Timothy Neuville, Assistant Vice President . . . . . . . . . . . Anaheim CA
William Newman, Assistant Vice President . . . . . . . . . . . New Haven CT
James Pelletteri, Assistant Vice President . . . . . . . . . . . .Albany NY
Anthony Philbin, Assistant Vice President. . . . . . . . . . .Penn Plaza NY
George Rescigno, Assistant Vice President. . . . . . . . . . . . . Miami FL
Anthony J. Rinaldi, Assistant Vice President . . . . . . . . Los Angeles CA
David Roy, Assistant Vice President. . . . . . . . . . . . .Boston South MA
Harvey Sanders, Assistant Vice President . . . . . . . . . . Wall Street NY

<PAGE>

SALES OFFICE STATE

Raphael J. Schnelly, Assistant Vice President. . . . . . . . . .St. Paul MN
Timothy Scrodin, Assistant Vice President. . . . . . . . . . . . .Albany NY
Peter Shalvoy, Assistant Vice President. . . . . . . . . . Grand Central NY
Robert Stutzman, Assistant Vice President. . . . . . . .Nebraska Central NE
Albert Troisi, Assistant Vice President. . . . . . . . . . . . . .Elmira NY
Anthony Trozzi, Assistant Vice President . . . . . . . . . . .Penn Plaza NY
Linda Tucker, Assistant Vice President . . . . . . . . . . . .Alexandria VA
Anthony Valente, Assistant Vice President. . . . . . . . . . . .Elmsford NY
Landon Vath, Assistant Vice President. . . . . . . . . . . . . .St. Paul MN
Joseph Ventura, Assistant Vice President . . . . . . . . . . . . .Albany NY
Michael Weiss, Assistant Vice President. . . . . . . . . . . . New Haven CT
Dan White, Assistant Vice President. . . . . . . . . . . . . .Boundbrook NJ

STATISTICAL DATA APPLICABLE TO
FIRST INVESTORS PLANS

CONTRACTUAL PLAN VS. OPEN ACCOUNT
COST COMPARISON ($50 PER MONTH--10 YEAR PLAN)

THE UNDERLYING FUND
FIRST INVESTORS PLAN UNDER AN OPEN ACCOUNT
- ----------------------------------------------------------------------------------------------------------------------------------
Maintenance % Net % Sales % Net
and % Total Investment Total Charges Investment
Total Sales Custodian Total Sales to Total Sales to Total to Total
Payments Charge Fees Charges Charge Payments Charges Payments Payments
--------- -------- --------- -------- ------- ---------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>

6 Months . . . . . . . . . $ 350.00 $ 173.25 $ 10.50 $183.75 49.50% 47.50% $ 21.53 6.25% 93.75%
1 Year . . . . . . . . . . 650.00 321.75 19.50 341.25 49.50 47.50 39.98 6.25 93.75
2 Years . . . . . . . . . . 1,250.00 327.03 37.50 364.53 26.16 70.84 76.88 6.25 93.75
10 Years . . . . . . . . . 6,000.00 368.83 180.00 548.83 6.15 90.85 369.00 6.25 93.75

</TABLE>

<PAGE>

$6,000 TEN-YEAR PAYMENT PLAN

ILLUSTRATION OF A PLAN UNDER FIRST INVESTORS CORPORATION CONTRACTUAL
PLANS FOR INVESTMENT IN FIRST INVESTORS HIGH YIELD FUND, INC.

This illustration is in terms of an assumed investment of $50 per month for
the period August 1986 (commencement of operations) to December 31, 1994 with
dividend and capital gain distributions paid in additional Fund shares. The Plan
provides for ten years of investing and an additional ten years during which
dividends from investment income and distributions from capital gains on
accumulated Fund shares are paid in shares.

The period covered was one of fluctuating securities prices. The results
shown should not be considered as a representation of the dividend income or
capital gain (or loss) which may be realized from an investment made in the Fund
today. A program of the type illustrated does not assure a profit, or protect
against depreciation in declining markets.

The table below was computed at the maximum sales charge of 8.75%. As of
this date of this Prospectus, the maximum sales charge has been reduced to
6.25%. If the current maximum sales charge had been in place, Deductions would
have been lower and Total Value of Shares would have been higher.

DEDUCTIONS*
-------------------------
MONTHLY PAYMENTS Annual Maintenance
- ----------------------------------- Dividend Total and
Year Income Cumulative Sales Custodian
Ended Annually Cumulative Reinvested Cost (a) Charge Fees
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>

1986 $300.00 $ 300.00 $ 3.15 $ 303.15 $148.50 $ 6.00
1987 600.00 900.00 39.24 942.39 177.15 12.00
1988 600.00 1,500.00 109.66 1,652.05 9.36 12.00
1989 600.00 2,100.00 194.79 2,446.84 9.36 12.00
1990 600.00 2,700.00 235.62 3,282.46 9.36 12.00
1991 600.00 3,300.00 300.15 4,182.61 9.36 12.00
1992 600.00 3,900.00 313.10 5,095.71 9.36 12.00
1993 600.00 4,500.00 426.54 6,122.25 9.36 12.00
1994 600.00 5,100.00 517.58 7,239.83 9.36 12.00
---------
$2,139.83
---------
---------

BALANCE Annual
INVESTED Capital Net
AFTER DEDUCTIONS Gain No. of Asset Total
Year ------------------------ Distribution Shares Value Value of
Ended Annually Cumulative Reinvested Accumulated(b) Reinvest Shares
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>

1986 $148.65 $ 148.65 $ .00 9.982 $14.80 $ 147.73
1987 450.09 598.74 .26 41.929 12.99 544.66
1988 688.30 1,287.04 .00 93.559 13.02 1,218.14
1989 773.43 2,060.47 .00 314.251(c) 5.26(c) 1,652.96(c)
1990 814.26 2,874.73 .00 491.824(c) 3.82(c) 1,878.77(c)
1991 878.79 3,753.52 .00 700.491(c) 4.56(c) 3,194.24(c)
1992 891.74 4,645.26 .00 886.281(c) 4.88(c) 4,325.05(c)
1993 1,005.18 5,650.44 .00 1,086.608(c) 5.10(c) 5,541.70(c)
1994 1,096.22 6,746.66 .00 1,312.610(c) 4.64(c) 6,090.51(c)
-----
$0.26
-----
-----

<FN>
* Under the terms of this Plan, out of the initial double payment of $100,
$49.50 is deducted as a sales charge, with $24.75 being deducted as a sales
charge from each of the next 11 payments. Additional deductions include $2.00
from the initial payment and $1.00 from each of the next 11 payments for
maintenance and custodian fees. Total deductions from the first 13 payments
equal $334.75, or 52% of the total of the first 13 monthly payments. If all of
the first 10 years' payments are made, total sales charges and other deductions
amount to 10.75% of the total agreed payments.

(a) Reflects the cumulative total of monthly payments plus the cumulative
amount of dividends paid in shares.

(b) Shares purchased include 877.926 from net payments invested, 434.648 from
net dividend income and .036 from capital gain distributions.

</TABLE>

24
<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.

STATEMENT OF ASSETS AND LIABILITIES

DECEMBER 31, 1994
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>

ASSETS
Investments, at value (NOTE 1)
First Investors High Yield Fund, Inc.
(3,076,555 shares) $14,890,526
First Investors Government Fund, Inc.
(166,650 shares) 1,749,825
-----------
TOTAL INVESTMENTS (Cost $19,356,352) (NOTE 3) 16,640,351
Dividends receivable
First Investors High Yield Fund, Inc. $8,539
First Investors Government Fund, Inc. 733
------
9,272
Cash 716
Other receivables 1,966
-----------
TOTAL ASSETS 16,652,305

LIABILITIES
Custodian fee payable 7,456
Dividends payable in cash 1,816
Payable for First Investors High Yield Fund, Inc.
shares purchased 2,682
------
TOTAL LIABILITIES 11,954
-----------

NET ASSETS (Equivalent to $4.64 per unit based on
3,584,437 units outstanding) $16,640,351
-----------
-----------

</TABLE>

- --------------------------------------------------------------------------------
THE NOTES TO FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THESE STATEMENTS

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.

STATEMENT OF OPERATIONS

YEAR ENDED DECEMBER 31, 1994
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>

INVESTMENT INCOME
DISTRIBUTIONS RECEIVED FROM INVESTMENTS
From: Net investment income $ 1,558,604

EXPENSES
Custodian fees $ 94,701
Delegated service fees 19,461
-----------
TOTAL EXPENSES 114,162
-----------
INVESTMENT INCOME - NET 1,444,442
-----------

REALIZED AND UNREALIZED GAIN (LOSS)
COMPLETE AND PARTIAL LIQUIDATIONS
Proceeds received,
net of custodian fees of $2,278 3,083,626
Cost of units sold 3,415,787
-----------
NET REALIZED LOSS (332,161)

UNREALIZED APPRECIATION (DEPRECIATION)
Beginning of year (1,415,620)
End of year (2,716,001)
-----------
NET DEPRECIATION FOR THE YEAR (1,300,381)
-----------
NET REALIZED AND UNREALIZED LOSS (1,632,542)
-----------
NET DECREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ (188,100)
-----------
-----------

</TABLE>

- --------------------------------------------------------------------------------
THE NOTES TO FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THESE STATEMENTS

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.

STATEMENT OF CHANGES IN NET ASSETS

YEARS ENDED DECEMBER 31, 1994 AND 1993
- -------------------------------------------------------------------------------------------------------------------------

1994 1993
---- ----
<S> <C> <C>

INCREASE (DECREASE) IN NET ASSETS FROM
Investment income - net $ 1,444,442 $ 1,457,545
Realized loss on units sold (332,161) (255,171)
Unrealized appreciation (depreciation) (1,300,381) 1,055,926
----------- -----------
(188,100) 2,258,300
Distributions from investment income - net (1,444,442) (1,457,545)
Capital transactions - net (NOTE 2) (428,371) (236,361)
----------- -----------

NET INCREASE (DECREASE) IN NET ASSETS (2,060,913) 564,394

NET ASSETS
Beginning of year 18,701,264 18,136,870
----------- -----------

END OF YEAR $16,640,351 $18,701,264
----------- -----------
----------- -----------

</TABLE>

- --------------------------------------------------------------------------------
THE NOTES TO FINANCIAL STATEMENTS ARE AN INTEGRAL PART OF THESE STATEMENTS

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.

NOTES TO FINANCIAL STATEMENTS

- --------------------------------------------------------------------------------

(1) SIGNIFICANT ACCOUNTING POLICIES

The Plan is a unit investment trust registered under the Investment Company
Act of 1940. The following significant accounting policies, which are in
conformity with generally accepted accounting principles for unit
investment trusts, are consistently used in the preparation of its
financial statements.

SECURITY VALUATION
Underlying investments of the Plan are valued at the net asset value
of each investment on the last day of the period.

TRANSACTION DATES
Unit and portfolio transactions are recorded on the trade date.
Distributions of investment income and realized gains are recorded on
the ex-dividend date.

INCOME TAXES
It is the Plan's policy to comply with the requirements of the
Internal Revenue Code to distribute all of its taxable income.
Therefore, no provision for federal income tax is required.

UNDERLYING INVESTMENT
In November 1990, sales of shares of First Investors High Yield Fund,
Inc. were voluntarily suspended pending the resolution of certain
legal actions. In order to enable Planholders to continue to make
Plan payments, the Sponsor obtained a Securities and Exchange
Commission order approving a temporary substitution of shares of First
Investors Government Fund, Inc. as the underlying investment for
continuing Plan payments.

Beginning in February 1991, the Plan, which had held only the original
First Investors High Yield Fund, Inc. shares, began purchasing shares
of First Investors Government Fund, Inc. and proportionally redeeming
shares in both Funds to satisfy redemptions.

On December 20, 1993, sales of shares of First Investors High Yield
Fund, Inc. were resumed as a result of settlements of legal actions.
Since December 20th, all monthly payments are being invested in shares
of First Investors High Yield Fund, Inc. and all redemption proceeds
are obtained from redemptions of shares of First Investors Government
Fund, Inc. Eventually, as the Plan continues, all shares of First
Investors Government Fund, Inc. held in the Plan will be eliminated
through redemptions.

- --------------------------------------------------------------------------------

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.

NOTES TO FINANCIAL STATEMENTS - (CONTINUED)

- --------------------------------------------------------------------------------

(2) CAPITAL TRANSACTIONS

At December 31, 1994 and 1993, the Plan held 3,584,437 and 3,670,235 units,
respectively. Unit transactions were as follows:

YEARS ENDED DECEMBER 31,
------------------------
1994 1993
-------------------------- -------------------------
AMOUNT SHARES AMOUNT SHARES
------ ------ ------- ------
<S> <C> <C> <C> <C>

Planholders payments $ 1,314,434 $ 1,550,933
----------- -----------
Less
Sales charges 56,968 70,414
Custodian fees 17,743 20,916
Insurance premiums * 19 35
----------- -----------
74,730 91,365
----------- -----------
Balance invested in units 1,239,704 254,057 1,459,568 291,126
Units acquired on
reinvestment of net
investment income 1,415,551 293,176 1,431,843 284,805
Redemptions and cancellations (3,083,626) (633,031) (3,127,772) (626,007)
----------- -------- ----------- --------

NET DECREASE $ (428,371) (85,798) $ (236,361) (50,076)
----------- -------- ----------- --------
----------- -------- ----------- --------

<FN>
* INCLUDES EXCESS INSURANCE PREMIUMS RETURNED UPON PLAN COMPLETIONS

</TABLE>

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.

NOTES TO FINANCIAL STATEMENTS - (CONTINUED)

- --------------------------------------------------------------------------------

(3) UNITHOLDERS' COST OF UNITS

The investment in units is carried at identified cost, which represents the
amount available for investment (including reinvested distributions of net
investment income and realized gains) in such units after deduction of
sales charges, custodian fees, and insurance premiums, if applicable.

The totals for the units outstanding at December 31, 1994, are as follows:

<TABLE>

<S> <C>

TOTAL AGREED PAYMENTS $83,278,440
-----------
-----------

Total payments made by Unitholders $16,795,620
Reinvested distributions from
Net investment income 6,541,037
Realized gains 751,407
-----------
TOTAL 24,088,064
-----------

Deductions
Fees and service charges 3,269,084
Insurance premiums 5,486
-----------
TOTAL DEDUCTIONS 3,274,570
-----------

Net investment 20,813,494
Less cost of partial withdrawals 1,786,468
-----------
NET COST OF UNITS 19,027,026
RETURN OF CAPITAL DISTRIBUTIONS REINVESTED 329,326
UNREALIZED DEPRECIATION (2,716,001)
-----------

NET AMOUNT APPLICABLE TO UNITHOLDERS $16,640,351
-----------
-----------

</TABLE>

(4) TRANSACTIONS WITH AFFILIATES

First Investors Corporation, the Plan Sponsor, receives all sponsor fees
from Plan payments and an annual delegated service fee from Plan dividends.
Administrative Data Management Corp., the Plan Transfer Agent, receives
the custodian fees from Plan payments, dividends and liquidations.

First Investors Life Insurance Company, Inc. serves as insurer for Plans
issued with group reducing term insurance.

- --------------------------------------------------------------------------------

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.

NOTES TO FINANCIAL STATEMENTS - (CONTINUED)

- --------------------------------------------------------------------------------

(5) PENDING LITIGATION

First Investors High Yield Fund, Inc. is a defendant in a number of cases
involving investors who invested in the First Investors High Yield Fund,
Inc. and First Investors Fund For Income, Inc. (collectively, the "FUNDS").
First Investors Fund For Income, Inc. and First Investors Corporation
("FIC") are also defendants in these cases. The suits allege that FIC
sales representatives had made misrepresentations concerning the risks of
investing in the Funds. FIC has made tentative settlements in connection
with several of these cases. In connection with these settlements, FIC's
parent company, First Investors Consolidated Corporation ("FICC"), has
agreed to assume the liability, if any, in the remaining suits.

- --------------------------------------------------------------------------------

<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

BOARD OF DIRECTORS
FIRST INVESTORS CORPORATION
AND THE PLANHOLDERS OF
FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN
FIRST INVESTORS HIGH YIELD FUND, INC.
NEW YORK, NEW YORK

We have audited the accompanying statement of assets and liabilities of First
Investors Periodic Payment Plans for Investment in First Investors High Yield
Fund, Inc. as of December 31, 1994, the related statement of operations for the
year then ended, and the statement of changes in net assets for each of the two
years in the period then ended. These financial statements are the
responsibility of the plan sponsor, First Investors Corporation. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of investments owned and units outstanding as
of December 31, 1994, by correspondence with the custodian. An audit also
includes assessing the accounting principles used and significant estimates made
by the plan sponsor, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of First Investors Periodic
Payment Plans for Investment in First Investors High Yield Fund, Inc. at
December 31, 1994, and the results of its operations and the changes in its net
assets for the respective periods then ended, in conformity with generally
accepted accounting principles.

TAIT, WELLER & BAKER

PHILADELPHIA, PENNSYLVANIA
FEBRUARY 23, 1995

<PAGE>

THE FINANCIAL STATEMENTS SHOWN BELOW ARE THE SPONSOR'S AND NOT THOSE OF FIRST
INVESTORS SINGLE PAYMENT PLANS AND PERIODIC PAYMENT PLANS. THEY ARE INCLUDED IN
THE PROSPECTUS FOR THE PURPOSE OF INFORMING INVESTORS AS TO THE FINANCIAL
RESPONSIBILITY OF THE SPONSOR AND ITS ABILITY TO CARRY OUT ITS CONTRACTUAL
OBLIGATIONS.

FIRST INVESTORS CORPORATION
BALANCE SHEET
DECEMBER 31, 1994

<TABLE>

ASSETS
CURRENT ASSETS
Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $11,884,795
Marketable securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364,764
Receivables from customers and others. . . . . . . . . . . . . . . . . . . . . . . 2,183,493
Salesmen advances--net, prepaid expenses and other
amounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,729,743
Receivable from affiliated companies . . . . . . . . . . . . . . . . . . . . . . . 21,237
-----------
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,184,032
FIXED ASSETS
Leasehold improvements and equipment (less accumulated
depreciation and amortization of $1,965,000) . . . . . . . . . . . . . . . . . . 527,520
OTHER ASSETS
Marketable securities--restricted. . . . . . . . . . . . . . . . . . . . . . . . . $ 111,696
Cash and cash equivalents segregated under
Federal Regulations (Note 2) . . . . . . . . . . . . . . . . . . . . . . . . . . 2,430,978
Deferred income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 572,000
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61,656
----------
Total other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,176,330
-----------
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $20,887,882
-----------
-----------

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Payable for securities purchased . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,207,916
Payable to dealers and customers . . . . . . . . . . . . . . . . . . . . . . . . . 1,208,690
Accrued commissions and supplier accounts payable. . . . . . . . . . . . . . . . . 916,549
Other liabilities and accrued expenses . . . . . . . . . . . . . . . . . . . . . . 5,200,528
-----------
Total current liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,533,683
CONTINGENCIES (Note 6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . --
STOCKHOLDERS' EQUITY
Common stock, no par, stated value $5,
200 shares authorized, issued and outstanding. . . . . . . . . . . . . . . . . . 1,000
Surplus. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,353,199
----------
Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,354,199
-----------
Total liabilities and stockholders' equity . . . . . . . . . . . . . . . . . . . $20,887,882
-----------
-----------

</TABLE>

See notes to financial statements

<PAGE>

FIRST INVESTORS CORPORATION
STATEMENT OF INCOME (LOSS) AND RETAINED EARNINGS

YEAR ENDED DECEMBER 31, 1994

<TABLE>

REVENUE
Commissions on sales of Funds and other securities . . . . . . . . . . . . . . . . $20,912,446
Sales of variable life insurance products. . . . . . . . . . . . . . . . . . . . . 6,650,851
Sponsor fees on periodic and single payment investment
plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 982,148
Service fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,006,748
-----------

32,552,193
Less commission expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,981,843
-----------
15,570,350

Income from investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,691
Other revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,394,074
-----------
Total revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,015,115

EXPENSES
Selling expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $12,723,556
Administrative expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,517,782
-----------

Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,241,338
-----------

Loss before income tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . . (4,226,223)
Income tax benefit (Note 8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,565,000)
-----------

Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,661,223)
Retained earnings (deficit)
Beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,451,404)
-----------

End of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(6,112,627)
-----------
-----------

</TABLE>

See notes to financial statements

<PAGE>

FIRST INVESTORS CORPORATION
STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 1994

<TABLE>

<S> <C>

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

Cash flows from operating activities
Commissions and fees received - net. . . . . . . . . . . . . . . . . . . . . . . . $ 22,015,967
Other revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,394,074
Investment income received . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340,309
Cash paid to suppliers and employees . . . . . . . . . . . . . . . . . . . . . . . (25,393,076)
Cash received from segregated trust account. . . . . . . . . . . . . . . . . . . . 206,114
Income taxes refunded. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,891,703
-------------

Net cash provided by operating activities. . . . . . . . . . . . . . . . . . . . 455,091
-------------

Cash flows from investing activities
Proceeds received on sale of investment securities . . . . . . . . . . . . . . . . 476,512
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (149,932)
-------------

Net cash used for investing activities . . . . . . . . . . . . . . . . . . . . . 326,580
-------------

Cash flows from financing activities
Capital contribution by parent . . . . . . . . . . . . . . . . . . . . . . . . . . 600,000
-------------

Net increase in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . 1,381,671

Cash and cash equivalents
Beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,503,124
-------------

End of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11,884,795
-------------
-------------

</TABLE>

<PAGE>

FIRST INVESTORS CORPORATION
STATEMENT OF CASH FLOWS--(Continued)

YEAR ENDED DECEMBER 31, 1994

<TABLE>

<S> <C>

RECONCILIATION OF NET INCOME (LOSS) TO NET CASH PROVIDED BY OPERATING ACTIVITIES
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (2,661,223)

Adjustments to reconcile net loss to net cash provided by operating activities
Depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . . . . 180,807
Loss on sale of investment securities. . . . . . . . . . . . . . . . . . . . . . 77,777
Net unrealized loss on marketable securities . . . . . . . . . . . . . . . . . . 211,841
Provision for deferred income taxes. . . . . . . . . . . . . . . . . . . . . . . 208,000

(Increase) decrease in
Receivable from dealers. . . . . . . . . . . . . . . . . . . . . . . . . . . . 785,872
Receivable from customers. . . . . . . . . . . . . . . . . . . . . . . . . . . 1,484,206
Receivable from Funds - shares redeemed. . . . . . . . . . . . . . . . . . . . (570,263)
Receivable from Funds - distribution fees. . . . . . . . . . . . . . . . . . . 146,374
Salesmen's advances - net. . . . . . . . . . . . . . . . . . . . . . . . . . . 120,757
Prepaid expenses and miscellaneous receivables . . . . . . . . . . . . . . . . 113,587
Cash and cash equivalents segregated under federal regulations . . . . . . . . 206,114
Receivable from affiliated companies . . . . . . . . . . . . . . . . . . . . . 443,801
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,882

Increase (decrease) in
Payable for securities purchased . . . . . . . . . . . . . . . . . . . . . . . (205,461)
Customer credit balances . . . . . . . . . . . . . . . . . . . . . . . . . . . (107,223)
Payable to dealers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 638,621
Accrued commissions payable. . . . . . . . . . . . . . . . . . . . . . . . . . (380,680)
Accounts payable--suppliers. . . . . . . . . . . . . . . . . . . . . . . . . . (108,696)
Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . . . . (1,495,497)
Payable to affiliated companies. . . . . . . . . . . . . . . . . . . . . . . . 1,363,495
------------

Net cash provided by operating activities. . . . . . . . . . . . . . . . . . . . . $ 455,091
------------
------------

</TABLE>

See notes to financial statements

<PAGE>

FIRST INVESTORS CORPORATION

NOTES TO FINANCIAL STATEMENTS

December 31, 1994

NOTE 1--SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF BUSINESS

First Investors Corporation (the "Company"), a wholly-owned subsidiary of
First Investors Consolidated Corporation ("FICC"), is engaged in business as a
broker-dealer primarily for the First Investors family of mutual funds
("Funds").

CASH EQUIVALENTS

The Company considers all investments in money market funds to be cash
equivalents.

FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK

In the normal course of business, the Company's customer activities involve
the execution and settlement of customer transactions. These activities may
expose the Company to risk of loss in the event the customer is unable to
fulfill its contracted obligations, in which case the Company may have to
purchase or sell financial instruments at prevailing market prices. Any loss
from such transactions is not expected to have a material effect on the
Company's financial statements.

SECURITY TRANSACTIONS

Security transactions are recorded on a trade date basis with related
commission income and expenses recorded as of the trade date.

MARKETABLE SECURITIES

Marketable securities are valued at market and include securities acquired
for investment purposes and securities held for re-sale to customers. As of
December 31, 1994, marketable securities consist principally of common stocks.
Marketable securities subject to withdrawal restrictions are classified under
"Other assets".

LEASEHOLD IMPROVEMENTS AND EQUIPMENT

Leasehold improvements and equipment are recorded at cost. Depreciation and
amortization are provided on a straight-line basis over the estimated useful
life of the asset, ranging from 5 to 15 years, or the remaining life of the
lease.

DISTRIBUTION PLANS

Pursuant to separate underwriting agreements with the Funds, the Company is
entitled to commissions on the sale of shares of the Funds in an amount ranging
from one percent to six and one-quarter percent of the amount received on the
sales. In addition, under separate distribution plans

<PAGE>

FIRST INVESTORS CORPORATION

NOTES TO FINANCIAL STATEMENTS--(Continued)

adopted under Rule 12b-1 of the Investment Company Act of 1940 for each Fund,
the Company receives distribution and service fees in an amount up to three-
tenths of one percent of the Fund's average daily net assets. The distribution
fees are intended to cover the cost of distributing the Fund shares, including
cost of travel and office expenses. The service fees provide for servicing or
maintenance of shareholder accounts, including payments to registered
representatives who provide ongoing servicing to such accounts. For the year
ended December 31, 1994, $4,812,953 of distribution fees were received from the
Funds and recorded as a reduction to selling expenses.

INCOME TAXES

The Company files consolidated federal and certain state income tax returns
with its parent and certain other wholly-owned subsidiaries of the parent. It is
the policy of the parent to allocate the applicable federal taxes (benefits) to
each subsidiary on a separate return basis.

The provision for income taxes includes amounts currently payable and
deferred income taxes (benefits). These deferred amounts arise from using
different accounting methods for tax and financial statement purposes, primarily
for unrealized appreciation (depreciation) of securities, sponsor fee refunds
and various accrued expenses.

NOTE 2--CASH AND CASH EQUIVALENTS SEGREGATED UNDER FEDERAL REGULATIONS

At December 31, 1994, cash and cash equivalents of approximately $2,431,000
were segregated in a special reserve bank account for the benefit of customers
under Rule 15c3-3 of the Securities Exchange Act of 1934 ("1934 Act"). The
minimum amount required was approximately $1,266,000. In January 1995, the
Company withdrew $950,000 from the special reserve bank account.

NOTE 3--RELATED PARTIES

The Company and certain wholly-owned subsidiaries of its parent share
office space and data processing facilities. The Company is charged its
proportionate share of expenses based on space occupied and usage of the data
processing facilities. Additionally, the Company charges certain of its
affiliates for management, office space and other services based upon time
allocated to the management and operation of the affiliate and space occupied.
During the year 1994 the Company charged certain of its affiliates approximately
$3,812,000 for management and other services and approximately $406,000 for
office space. The Company purchased approximately $599,000 of data processing
services, and approximately $339,000 of office space during the year.

The Company also receives commissions and fees on the sale of various life
insurance products from an affiliated life insurance company. For 1994, these
commissions and fees amounted to approximately $6,651,000.

In addition to the outstanding advances between the Company and its
affiliates, the Company at December 31, 1994 had approximately $3,039,000
deposited in an account of an affiliated savings bank, and approximately
$7,376,000 invested in First Investors mutual funds, principally in the money
market fund.

<PAGE>

FIRST INVESTORS CORPORATION

NOTES TO FINANCIAL STATEMENTS--(Continued)

NOTE 4--PROFIT-SHARING PLAN

The Company is a participating employer with certain other wholly-owned
subsidiaries of its parent in a profit-sharing plan covering all of its eligible
employees. Contributions to the plan are determined annually by the Board of
Directors and are based on the consolidated income of the parent. There were no
contributions for 1994. FICC has assumed the responsibility of the Company's
non-qualified profit-sharing plan for the benefit of registered representatives.

NOTE 5--LEASES

The Company leases office space under terms of various lease agreements,
certain of which are cancelable at the end of specified time periods and others
which are non-cancelable, expiring at various times through 2005. Total rent
expense was approximately $3,340,000 for 1994. The minimum annual rental
commitments relating to leases in effect as of December 31, 1994 exclusive of
taxes and other charges by lessors subject to escalation clauses, are as
follows:

1995 . . . . . . . . . . . . . . . . . .$ 3,090,000
1996 . . . . . . . . . . . . . . . . . . 2,700,000
1997 . . . . . . . . . . . . . . . . . . 2,387,000
1998 . . . . . . . . . . . . . . . . . . 2,127,000
1999 through 2005. . . . . . . . . . . . 11,719,000
-----------

$22,023,000
-----------
-----------

NOTE 6--LITIGATION

The Company is a defendant in a number of sales practice cases which allege
that certain of the Company's sales representatives had made misrepresentations
concerning the risks of investing in First Investors Fund For Income, Inc. and
First Investors High Yield Fund, Inc., investment companies which invest
primarily in high yield funds. The Company has made tentative settlements in
connection with several of these cases which involve collectively approximately
180 investors. The Company's parent has assumed and accrued a liability for
these settlements for approximately $3.5 million in 1994. This amount was
subsequently paid in January 1995. The Company believes that the remaining
cases, which involve collectively approximately 17 investors, will not have a
material adverse effect on its financial condition. The Company's parent has
agreed to assume such liabilities, if any.

The Company is a defendant in a number of other lawsuits involving claims
for damages of the type normally associated with the Company's business.
Management is of the opinion that such lawsuits will not result in any material
liability to the Company.

<PAGE>

FIRST INVESTORS CORPORATION

NOTES TO FINANCIAL STATEMENTS--(Continued)

NOTE 7--NET CAPITAL REQUIREMENTS

As a registered broker-dealer the Company is subject to the Uniform Net
Capital Rule, Rule 15c3-1, under the 1934 Act. Under the alternative method
permitted by this Rule, required net capital shall not be less than 2% of
aggregate debit items arising from customer security transactions. At
December 31, 1994, the Company had net capital of approximately $1,935,000, or
an excess of approximately $1,685,000, over net capital required of $250,000.

For additional information, the Company's statement of financial condition
filed pursuant to Rule 17a-5 under the 1934 Act is available for inspection at
the Company's main office or at the regional office of the SEC.

<PAGE>

NOTE 8--INCOME TAXES

The Company adopted Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes" ("SFAS 109"), effective January 1, 1993. SFAS 109
is an asset and liability approach that requires the recognition of deferred tax
assets and liabilities for the expected future tax consequences of events that
have been recognized in the Company's financial statements or tax returns.

The provision for income taxes consists of the following:

CURRENT
Federal . . . . . . . . . . . . . . . . . . . . $ (1,590,000)
State and local . . . . . . . . . . . . . . . . (183,000)
------------
(1,773,000)
------------

DEFERRED
Federal . . . . . . . . . . . . . . . . . . . . 164,300
State and local . . . . . . . . . . . . . . . . 43,700
------------
208,000
------------
Total . . . . . . . . . . . . . . . . . . . $ (1,565,000)
------------
------------

Deferred tax liabilities (assets) are comprised of the following:

Unrealized gains . . . . . . . . . . . . . . . . . $(29,600)
Accrued expenses . . . . . . . . . . . . . . . . . (470,000)
Depreciation . . . . . . . . . . . . . . . . . . . (97,500)
Other. . . . . . . . . . . . . . . . . . . . . . . 25,100
---------
$(572,000)
---------
---------

A reconciliation of the Federal statutory income tax rate to the Company's
effective rate is as follows:

Statutory rate . . . . . . . . . . . . . . . . . . 34.0%
Increases in effective tax rate resulting from:
State and local income taxes, net of federal
tax benefit . . . . . . . . . . . . . . . . . . 1.1
Other . . . . . . . . . . . . . . . . . . . . . 1.9
----

Actual effective rate. . . . . . . . . . 37.0%
----
----

<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors and Stockholder
First Investors Corporation
New York, New York

We have audited the accompanying balance sheet of First Investors
Corporation as of December 31, 1994, and the related statements of operations
and retained earnings (deficit), and cash flows for the year then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of First Investors Corporation
at December 31, 1994 and the results of its operations and its cash flows for
the year then ended, in conformity with generally accepted accounting
principles.

TAIT, WELLER & BAKER

Philadelphia, Pennsylvania
February 15, 1995

<PAGE>

SALES OFFICES

ARIZONA ILLINOIS NEBRASKA OREGON
PHOENIX CHICAGO OMAHA BEAVERTON
TUCSON ELGIN
OAKBROOK NEW JERSEY PENNSYLVANIA
CALIFORNIA WESTCHESTER FAIRFIELD BALA CYNWYD
ANAHEIM ISELIN FEASTERVILLE
LOS ANGELES INDIANA MANASQUAN PHILADELPHIA
SAN JOSE INDIANAPOLIS MIDDLESEX PITTSBURGH
SHREWSBURY
COLORADO KENTUCKY WOODBRIDGE RHODE ISLAND
DENVER LEXINGTON WARWICK
ENGLEWOOD NEW YORK
LOUISIANA ALBANY TEXAS
CONNECTICUT METAIRIE BINGHAMTON FT. WORTH
HARTFORD BRONX HOUSTON
NORTH HAVEN MAINE ELMIRA
PORTLAND ELMSFORD VIRGINIA
FLORIDA FAYETTEVILLE ARLINGTON
FORT LAUDERDALE MARYLAND JERICHO GLEN ALLEN
JACKSONVILLE COLUMBIA MANHATTAN HAMPTON
LAUDERHILL MINEOLA RESTON
MIAMI MASSACHUSETTS NEWBURGH
NORTH MIAMI HOLYOKE ROCHESTER WASHINGTON
TAMPA QUINCY SPRING VALLEY TUKWILA
WINTER PART WOBURN WHITE PLAINS
WILLIAMSVILLE WEST VIRGINIA
GEORGIA MICHIGAN WHEELING
ATLANTA NORTHVILLE NORTH CAROLINA
NORCROSS CHARLOTTE WISCONSIN
MINNESOTA BROOKFIELD
BLOOMINGTON OHIO
COLUMBUS
MISSOURI INDEPENDENCE
KANSAS CITY
ST. LOUIS

<PAGE>

EXHIBITS

1. (A - Form N-8B-2)

1.* Custodian Agreement

2. Not Applicable

3(a)* Specimen of Agreement between the Sponsor and a
registered representative with schedule of sales
commissions attached

3(b) Not Applicable

3(c) Not Applicable

4. Not Applicable

5.* Specimen Plan Certificate for Periodic Payment Plans
(10 and 15 years)

6.* Certificate of Incorporation, as amended, and By-Laws,
as amended, of First Investors Corporation

7. Not Applicable

8.* Agreement between the Sponsor and First Investors
Management Company, Inc. to provide shares of First
Investors High Yield Fund, Inc.

9. Not Applicable

10a.* Application Form - 10-year Periodic Payment Plan
b.* Application Form - 15-year Periodic Payment Plan
c.* Letter of Intention Form

2. See 1.A(5) above

3.** Opinion of Counsel

4. Not Applicable

5. Not Applicable

ADDITIONAL EXHIBITS

1.* Revocable Declaration of Trust.

- -----------------------

* Incorporated by reference from Registrant's Registration
Statement (File No. 2-53252) previously filed with the
Commission.

** Incorporated by reference from Registrant's Rule 24f-2
Notice for its fiscal year ended December 31, 1994 filed
with the Commission on February 21, 1995.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant represents that this Amendment
meets all the requirements for effectiveness pursuant to Rule 485(b) under the
Securities Act of 1933 and has duly caused this Post-Effective Amendment to this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of New York, State of New York, on the 11th day of
April, 1995.

FIRST INVESTORS PERIODIC PAYMENT
PLANS FOR INVESTMENT IN FIRST
INVESTORS HIGH YIELD FUND, INC.
(Registrant)

BY: FIRST INVESTORS CORPORATION
ATTEST: (Depositor)

/s/ Larry R. Lavoie By /s/ Marvin M. Hecker
- ------------------- ---------------------
Larry R. Lavoie Marvin M. Hecker
Secretary and General Counsel President

As required by the Securities Act of 1933, this Amendment to this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:

SIGNATURE TITLE DATE
- --------- ----- ----

/s/ Marvin M. Hecker President April 11, 1995
- ---------------------
Marvin M. Hecker

/s/ Glenn O. Head Chairman of the Board April 11, 1995
- ---------------------
Glenn O. Head

/s/ Kathryn S. Head Vice President and April 11, 1995
- --------------------- Chief Financial Officer
Kathryn S. Head

<PAGE>

/s/ Joseph I. Benedek Treasurer April 11, 1995
- ---------------------
Joseph I. Benedek

/s/ Larry R. Lavoie Secretary April 11, 1995
- ---------------------
Larry R. Lavoie

/s/ Glenn O. Head Director April 11, 1995
- ---------------------
Glenn O. Head

/s/ John T. Sullivan Director April 11, 1995
- ---------------------
John T. Sullivan

/s/ Kathryn S. Head Director April 11, 1995
- ---------------------
Kathryn S. Head

/s/ Lawrence A. Fauci Director April 11, 1995
- ---------------------
Lawrence A. Fauci

/s/ Roger L. Grayson Director April 11, 1995
- ---------------------
Roger L. Grayson

/s/ Jeremiah J. Lyons Director April 11, 1995
- ---------------------
Jeremiah J. Lyons

/s/ Jane W. Kruzan Director April 11, 1995
- ---------------------
Jane W. Kruzan

* By: /s/ Larry R. Lavoie
------------------------
Larry R. Lavoie
Attorney-In-Fact

<PAGE>

CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

First Investors Corporation
95 Wall Street
New York, New York 10005

We hereby consent to the use in Post-Effective Amendment No. 20 to the
Registration Statement on Form S-6 (File No. 2-53252) of our report dated
February 23, 1995 relating to the December 31, 1994 financial statements of
First Investors Periodic Payment Plans for Investment in First Investors High
Yield Fund, Inc. and our report dated February 15, 1995 relating to the December
31, 1994 financial statements of First Investors Corporation, which are included
in said Registration Statement.

/s/ Tait, Weller & Baker

TAIT, WELLER & BAKER

Philadelphia, Pennsylvania
April 11, 1995

<PAGE>

FIRST INVESTORS PERIODIC PAYMENT PLANS
FOR INVESTMENT IN FIRST INVESTORS
HIGH YIELD FUND, INC.

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS that the undersigned officer and/or director
of First Investors Corporation, as Depositor of First Investors Periodic Payment
Plans for Investment in First Investors High Yield Fund, Inc., hereby appoints
Glenn O. Head or Larry R. Lavoie and each of them his true and lawful attorney
to execute in his name, place and stead and on his behalf a Registration
Statement on Form S-6 for the registration pursuant to the Securities Act of
1933 and the Investment Company Act of 1940 of periodic payment plan
certificates and any and all amendments to said Registration Statement
(including post-effective amendments), and all instruments necessary or
incidental in connection therewith and to file the same with the Securities and
Exchange Commission. Said attorney shall have full power and authority to do
and perform in the name and on behalf of the undersigned every act whatsoever
requisite or desirable to be done in the premises, as fully and to all intents
and purposes as the undersigned might or could do, the undersigned hereby
ratifying and approving all such acts of said attorney.