SCHEDULE 14A
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[ ] Confidential, for use of the Commission only (as permitted by Rule
14-6(e)(2))
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
The First Australia Fund, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
The First Australia Fund, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and O-11.
(1) Title of each class of securities to which transaction applies:
_________________________________________________________________________
(2) Aggregate number of securities to which transaction applies:
_________________________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
_________________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
_________________________________________________________________________
(5) Total Fee Paid:
_________________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
_________________________________________________________________________
(2) Form, schedule or registration statement no.:
_________________________________________________________________________
(3) Filing party:
_________________________________________________________________________
(4) Date filed:
_________________________________________________________________________
<PAGE>
Gateway Center 3
100 Mulberry Street
Newark, New Jersey 07102
(212) 214-1665
January 20, 1997
Dear Shareholder:
The Annual Meeting of Shareholders is to be held at 2:00 p.m. on
Thursday, March 13, 1997, at the offices of Prudential Securities Incorporated,
One Seaport Plaza, New York, New York. A Proxy Statement regarding the meeting,
proxy card for your vote at the meeting and an envelope - postage prepaid - in
which to return your proxy are enclosed.
At the Annual Meeting, the shareholders will elect the Fund's Class III
Directors and will consider the ratification of the selection of Price
Waterhouse LLP as independent public accountants. In addition, the shareholders
present will hear a report on the Fund. There will be an opportunity to discuss
matters of interest to you as a shareholder.
Your Directors recommend that the shareholders vote in favor of each of
the foregoing matters.
LAURENCE S. FREEDMAN BRIAN M. SHERMAN
Chairman President
SHAREHOLDERS ARE URGED TO SIGN AND MAIL THE ENCLOSED PROXY IN THE ENCLOSED
ENVELOPE SO AS TO ASSURE A QUORUM AT THE MEETING. THIS IS IMPORTANT REGARDLESS
OF THE SIZE OF YOUR SHAREHOLDING.
<PAGE>
(This page has been left blank intentionally.)
<PAGE>
THE FIRST AUSTRALIA FUND, INC.
Gateway Center 3
100 Mulberry Street
Newark, New Jersey 07102
-----------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
March 13, 1997
-----------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of The
First Australia Fund, Inc. (the "Fund") will be held at the offices of
Prudential Securities Incorporated, One Seaport Plaza, New York, New York on
March 13, 1997, at 2:00 p.m. for the following purposes:
(1) To elect five Directors to serve as Class III Directors for a
three-year term;
(2) To ratify the selection of Price Waterhouse LLP as independent
public accountants of the Fund for the fiscal year ending October 31, 1997; and
(3) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on January 2,
1997 as the record date for the determination of shareholders entitled to vote
at the meeting or any adjournment thereof.
By Order of the Board of Directors,
Roy M. Randall, Secretary
Newark, New Jersey
January 20, 1997
IMPORTANT: You are cordially invited to attend the meeting. Shareholders who do
not expect to attend the meeting in person are requested to complete, date and
sign the enclosed form of proxy and return it promptly in the addressed envelope
which requires no postage and is intended for your convenience. Your prompt
return of the enclosed proxy may save the Fund the necessity and expense of
further solicitations to assure a quorum at the meeting. The enclosed proxy is
being solicited on behalf of the Board of Directors of the Fund.
<PAGE>
(This page has been left blank intentionally.)
<PAGE>
PROXY STATEMENT
THE FIRST AUSTRALIA FUND, INC.
Gateway Center 3
100 Mulberry Street
Newark, New Jersey 07102
-----------
Annual Meeting of Shareholders
March 13, 1997
-----------
INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of The First Australia Fund, Inc.
(the "Fund"), a Maryland corporation, to be voted at the Annual Meeting of
Shareholders of the Fund (the "Meeting") to be held at the offices of Prudential
Securities Incorporated, One Seaport Plaza, New York, New York, on March 13,
1997, at 2:00 p.m. The approximate mailing date for this Proxy Statement is
January 20, 1997.
All properly executed proxies received prior to the Meeting will be
voted at the Meeting in accordance with the instructions marked thereon or
otherwise as provided therein. Unless instructions to the contrary are marked,
proxies will be voted in favor of Proposals 1 and 2. Any proxy may be revoked at
any time prior to the exercise thereof by giving written notice to the Secretary
of the Fund (addressed to the Secretary at the principal executive office of the
Fund, Gateway Center 3, 100 Mulberry Street, Newark, New Jersey 07102).
The Board of Directors has fixed the close of business on January 2,
1997 as the record date for the determination of shareholders entitled to notice
of and to vote at the Meeting and at any adjournment thereof. Shareholders on
the record date will be entitled to one vote for each share held. As of January
2, 1997, the Fund had 16,914,278.02 shares of common stock outstanding, par
value $.01 per share. To the knowledge of management of the Fund, no persons or
group beneficially own more than five percent of the outstanding shares of
common stock of the Fund.
The Board of Directors of the Fund knows of no business other than that
mentioned in the Notice of the Meeting which will be presented for consideration
at the Meeting. If any other matter is properly presented, it is the intention
of the persons named in the enclosed proxy to vote in accordance with their best
judgment.
The Fund will furnish, without charge, a copy of the Fund's annual
report for its fiscal year ended October 31, 1996 to any Fund shareholder upon
request. To request a copy please call or write to the Fund's Administrator,
Prudential Mutual Fund Management, Inc., Gateway Center 3, 100 Mulberry Street,
Newark, New Jersey 07102, Telephone: 1-800-451-6788.
<PAGE>
PROPOSAL 1: ELECTION OF CLASS III DIRECTORS
The Fund's By-laws provide that the Board of Directors will be divided
into three classes of Directors, as nearly equal in number as possible, each of
which, after a transition period, will serve for three years with one class
being elected each year. Each year the term of office of one class will expire.
Sir Roden Cutler, David Lindsay Elsum, Laurence S. Freedman, Michael R.
Horsburgh and William J. Potter, Directors who were elected to serve until the
Meeting, have been nominated for a three-year term to expire at the Annual
Meeting of Shareholders to be held in 2000 and until their successors are duly
elected and qualified. The nominees have indicated an intention to serve if
elected and have consented to be named in this Proxy Statement.
It is the intention of the persons named in the enclosed proxy to vote
in favor of the election of persons listed below under Class III. The Board of
Directors of the Fund knows of no reason why any of these nominees will be
unable to serve, but in the event of any such inability, the proxies will be
voted for such substituted nominees as the Board of Directors may recommend.
The following table sets forth certain information concerning each of
the nominees for election as a Director of the Fund and each Director of the
Fund. Each of the nominees is currently a Director of the Fund.
<TABLE>
<CAPTION>
Shares
Beneficially
Owned and %
Present Office With the Fund, of Total
Name and Address Principal Occupation or Director Outstanding
of Each Director or Nominee Employment and Directorships Age Since on 10/31/96 (1)
--------------------------- ---------------------------- --- ----- ---------------
Class I (Term Expiring at the Annual Meeting to be held in 1998)
<S> <C> <C> <C>
Anthony E. Aaronson (++) Director, The First Australia Prime 60 1985 -
116 South Anita Avenue Income Fund, Inc. (since 1986); Tony
Los Angeles, CA 90049 Aaronson (textile agency) (since 1993);
Vice President, Fortune Fashions
(1992-1993); President, Fashion Fabric
Division, Forrest Fabrics (textiles)
(August 1991-1992); Director, PKE
Incorporated (consulting company)
(1988-1990); Director, Textile
Association of Los Angeles (1990-1993);
Vice President, Textile Association of
Los Angeles (1996-1997); Director,
O.T.C. Sales, Emday Fabrics Co.
(textiles) (1986-1991); Executive
Vice-President and Secretary-Treasurer,
J&J Textiles Inc. (1982-1986).
<PAGE>
Roger C. Maddock* Director, The First Australia Prime 46 1992 -
Union House, Union Street Income Fund, Inc. and The First
St. Helier, Jersey Commonwealth Fund, Inc. (since 1992);
Channel Islands JE4 8TQ Chairman and Managing Director,
United Kingdom EquitiLink International Management
Limited (since 1985); Partner, Jackson Fox,
Chartered Accountants (since 1981); Director,
Worthy Trust Company Limited (since 1993);
Director, Professional Consultancy Services
Limited (since 1983); Director, Hollywell Spring
Limited (since 1987); Director, The EquitiLink
Private Gold Investment Fund Limited (since
1992); Director, CentraLink-EquitiLink
Investment Company Limited (since 1994).
Neville Miles Director, The First Australia Prime 50 1996 -
23 Regent Street Income Fund, Inc. (since 1996); Director,
Paddington N.S.W. 2021 MaxiLink Limited (investment company);
Australia Director, Walker Corp. Limited
(property development); Director, First
Resources Development Fund Limited (investment
company); Executive Director, EL&C Baillieu
Limited (stock broker) (1994-1996); Executive
Director, Old Minnett Securities Limited
(stockbroker) (1988-1994).
John T. Sheehy (++)(*) Director, The First Australia Prime 54 1985 -
1 Southwest Columbia Income Fund, Inc. (since 1986), First
12th Floor Australia Prime Income Investment
Portland, OR 97258 Company Limited (since 1986) and The
First Commonwealth Fund, Inc. (since
1992); Managing Director, Black &
Company (broker- dealer and investment
bankers); Director, Greater Pacific Food
Holdings, Inc. (food industry investment
company) (since 1993); Partner, Sphere
Capital Partners (corporate consulting)
(since 1987); Director, Sphere Capital
Advisors (investment adviser); Director,
Sandy Corporation (corporate consulting,
communication and training) (since
1986); Associate Director, Bear,
Stearns & Co. Inc. (1985-1987);
previously, Limited Partner, Bear,
Stearns & Co. Inc.
<PAGE>
Class II (Term Expiring at the Annual Meeting to be held in 1999)
Harry A. Jacobs, Jr.* Director, The First Australia Prime 75 1985 3,979
One New York Plaza Income Fund, Inc. (since 1986);
New York, NY 10292 Chairman and Chief Executive Officer,
Prudential Mutual Fund
Management, Inc. (June -
September 1993); Senior Director,
Prudential Securities Incorporated (since
1986); previously, Chairman of the
Board, Prudential Securities Incorporated
(1982-1985); Chairman of the Board and
Chief Executive Officer, Bache
Group, Inc. (1977-1982); Trustee, The
Trudeau Institute (eleemosynary);
Director of 11 investment companies
affiliated with Prudential Securities
Incorporated.
Rt. Hon. Malcolm Fraser, Director, The First Australia Prime 66 1985 -
A.C., C.H. (+) Income Fund, Inc. (since 1986), First
55 Collins Street Australia Prime Income Investment
Melbourne, Victoria 3000 Company Limited (since 1986) and The
Australia First Commonwealth Fund, Inc. (since
1992); Partner, Nareen Pastoral Company
(agriculture); Fellow, Center for International
Affairs, Harvard University; International
Council of Associates, Claremont University;
Member, ANZ International Board of Advice
(1987-1990); InterAction Council for Former
Heads of Government (1987-1993); Co-Chairman,
Commonwealth Eminent Persons Group on Southern
Africa (1985-1986); Chairman, United Nations
Committee on African Commodity Problems
(1989-1990); Consultant, The Prudential
Insurance Company of America; International
Consultant on Political, Economic and Strategic
Affairs (since 1983); Parliamentarian-Prime
Minister of Australia (1975-1983).
<PAGE>
Howard A. Knight Director, The First Australia Prime 54 1993 -
87 Cadogan Gardens Income Fund, Inc. (since 1993); Director
Suite #1 and Vice Chairman, Scandinavian
London SW3 2RD Broadcasting System SA (television and
United Kingdom radio broadcasting) (since July 1996);
Private Investor and Consultant
(1994-1996); President of Investment
Banking, Equity Transactions and
Corporate Strategy, Prudential Securities
Incorporated (1991-1994); formerly
Chairman and Chief Executive Officer,
Avalon Corporation (1984-1990);
Managing Director, President and Chief
Executive Officer, Weeks Petroleum
Limited (1982-1984); General Counsel,
member of the Executive Committee and
Director, Farrell Lines Incorporated
(1976-1982); Partner, Cummings &
Lockwood (1963-1976).
Brian M. Sherman* President and Director of the Fund; 53 1985 -
Level 3 President and Director, The First
190 George Street Australia Prime Income Fund, Inc. (since
Sydney, N.S.W. 2000 1986); Joint Managing Director (since
Australia 1986) and Chairman (since 1995), First
Australia Prime Income Investment Company
Limited; Director and Sole Vice President (since
1992) and Chairman (since 1995), The First
Commonwealth Fund, Inc.; Chairman and Joint
Managing Director, EquitiLink Limited (since
1986); Chairman and Joint Managing Director,
EquitiLink Australia Limited (since 1981);
Director, EquitiLink International Management
Limited (since 1985); Joint Managing Director,
MaxiLink Limited (since 1987); Executive
Director, MaxiLink Securities Limited (since
1987); Joint Managing Director, First Resources
Development Fund Limited (since 1994); Director,
Ten Group Limited (since 1994); Director,
telecasters North Queensland Limited (since
1993); Director, Sydney Organizing Committee for
the Olympic Games; Fund and Portfolio Manager,
Westpac Banking corporation (1976-1981);
Manager-Investments, Outwich Limited (an
affiliate of Baring Brothers & Co. Ltd.)
(merchant bank) (1972-1976).
Richard H. McCoy (++)(*) Director, the First Australia Prime 54 1993 -
B.C.E. Place Income Investment Company Limited
P.O. Box 500 (since 1993); Deputy Chairman, CIBC
Toronto, Ontario M5J 2S8 Wood Gundy Securities Inc. (investment
Canada dealer) (since 1978).
<PAGE>
Class III (Current Directors and Nominees for a Term Expiring
at the Annual Meeting to be held in 2000)
Sir Roden Cutler, V.C., Chairman (1986-1995) and Director 80 1985 -
A.K., K.C.M.G., K.C.V.O., (since 1986), The First Australia Prime
C.B.E., K.St.J. (+) Income Fund, Inc.; Chairman
22 Ginahgulla Road (1986-1995) and Director (since 1986),
Bellevue Hill, N.S.W. 2023 First Australia Prime Income Investment
Australia Company Limited; Chairman (1992-1995)
and Director (since 1992), The First
Commonwealth Fund, Inc.; Australia
Director, Rothmans Holding Ltd.
(formerly Rothmans Pall Mall) (tobacco)
(1981-1994); Chairman, State Bank of
New South Wales (1981-1986); Governor
of New South Wales, Australia
(1966-1981).
David Lindsay Elsum, Director, The First Australia Prime 59 1985 -
A.M. (+) Income Fund, Inc. (since 1986), First
9 Maygrove Australia Prime Income Investment
South Yarra, Victoria 3141 Company Limited (since 1986) and The
Australia First Commonwealth Fund, Inc. (since
1992); Chairman, Health Computing Services
Limited; Director, MaxiLink Limited; President,
State Superannuation Fund of Victoria
(1986-1993); Director, IlTec Limited; Managing
Director, The MLC Limited (insurance)
(1984-1985); Managing Director, Renison
Goldfields Consolidated Limited (mining)
(1983-1984); Member, Corporations and Securities
Panel of the Australian Securities Commission of
Australian States and Territories; Chairman,
Queen Victoria Market; Director, First Resources
Development Fund.
<PAGE>
Laurence S. Freedman* Sole Vice President (since 1985) and 53 1985 -
Level 3 Chairman (since 1995) of the Fund; Sole
190 George Street Vice President and Director (since 1986)
Sydney, N.S.W. 2000 and Chairman (since 1995), The First
Australia Australia Prime Income Fund, Inc.; Joint
Managing Director, First Australia Prime Income
Investment Company Limited (since 1986);
President and Director, The First Commonwealth
Fund, Inc. (since 1992); Founder and Joint
Managing Director, EquitiLink Limited (since
1986); Joint Managing Director, EquitiLink
Australia Limited (since 1981); Director,
EquitiLink International Management Limited
(since 1985); Chairman and Joint Managing
Director, MaxiLink Limited (since 1987);
Executive Director, MaxiLink Securities Limited
(since 1987); Chairman and Joint Managing
Director, First Resources Development Fund
Limited (since 1994); Director, Ten Group
Limited (since 1994); Director, Telecasters
North Queensland Limited (since 1993); Managing
Director, Link Enterprises (International) Pty.
Limited (an investment management company)
(since 1980); Manager of Investments, Bankers
Trust Australia Limited (1978-1980); Investment
Manager, Consolidated Goldfields (Australia)
Limited (natural resources investments)
(1975-1978).
Michael R. Horsburgh Director, The First Australia Prime 51 1985 -
675 Third Avenue Income Fund, Inc. (since 1986); Director,
22nd Floor The First Commonwealth Fund, Inc.
New York, NY 10017 (since 1994); Director and Chief
Executive Officer, Carlson Investment
Management, Inc. (since 1991); Director,
The First Hungary Fund; Managing
Director, Barclays de Zoete Wedd
Investment Management (U.S.A.)
(1990-1991); Special Associate Director,
Bear, Stearns & Co. Inc., (1989-1990);
Senior Managing Director, Bear,
Stearns & Co. Inc. (1985-1989); General
Partner, Bear, Stearns & Co. Inc.
(1981-1985); previously, Limited Partner,
Bear, Stearns & Co. Inc.
<PAGE>
William J. Potter+ Director, The First Australia Prime 48 1985 1,000
156 W. 56th Street Income Fund, Inc. (since 1986), First
17th Floor Australia Prime Income Investment
New York, NY 10019 Company Limited (since 1986) and The
First Commonwealth Fund, Inc. (since 1992);
Partner, Sphere Capital Partners (corporate
consulting) (since 1989); President, Ridgewood
Partners, Ltd. (investment banking) (since
1989); Managing Director, Prudential-Bache
Securities Inc. (1984-1989); Director, National
Foreign Trade Association; Director, Alexandria
Bancorp Limited; Director, Battery Technologies,
Inc.; Director, Compuflex Inc.; Director,
Impulsora del Fondo Mexico; Director, Canadian
Health Foundation; First Vice President,
Barclays Bank, plc (1982-1984); previously,
various positions with Toronto Dominion Bank.
<FN>
- -----------
* Directors considered by the Fund and its counsel to be persons who are
interested persons (which as used in this Proxy Statement is as defined in the
Investment Company Act of 1940, as amended (the 1940 Act)) of the Fund or of the
Fund's investment manager or investment adviser. Mr. Jacobs is deemed to be an
interested person because of his affiliation with Prudential Securities
Incorporated, a broker-dealer registered under the Securities Exchange Act of
1934. Messrs. Freedman, Sherman and Maddock are deemed to be interested persons
because of their affiliation with the Fund's investment manager and investment
adviser, or because they are officers of the Fund or both. Mr. McCoy may be
deemed to be an interested person because of his affiliation with CIBC Wood
Gundy Securities Inc.
+ Messrs. Cutler, Elsum, Fraser and Potter are members of the Contract Review
Committee.
++ Messrs. Aaronson, McCoy and Sheehy are members of the Audit Committee.
(1) The information as to beneficial ownership is based on statements furnished
to the Fund by the Directors and nominees. All shares listed in this table are
owned with sole voting and investment power and in the aggregate represent less
than 1/4 of 1% of the total shares outstanding as of October 31, 1996.
</FN>
</TABLE>
Committees and Board of Director Meetings. The Board of Directors has a
standing Audit Committee, which consists of certain Directors who are not
interested persons of the Fund as defined in the 1940 Act. The principal purpose
of the Audit Committee is to review the scope and results of the annual audit
conducted by the Fund's independent public accountants and the evaluation by
such accountants of the accounting procedures followed by the Fund. The Board of
Directors also has a standing Contract Review Committee that reviews and makes
recommendations to the Board with respect to entering into, renewal or amendment
of the Management Agreement, the Advisory Agreement, the Consultant Agreement
and the Administration Agreement. The Board of Directors does not have a
standing nominating committee.
During the Fund's fiscal year ended October 31, 1996, the Board of
Directors held five meetings, the Audit Committee held two meetings and the
Contract Review Committee held one meeting. Each of the Directors then in office
attended at least 75% of the total number of the meetings of the Board of
Directors and all meetings of the Committees of the Board on which he served,
except Mr. Aaronson, who attended one of the two meetings of the Audit
Committee, and Mr. Calvert- Jones, who attended only two of four Board Meetings
held prior to his
<PAGE>
resignation. Mr. Calvert-Jones resigned from the Board at the September 12, 1996
meeting and was replaced at that time by Mr. Neville Miles.
Officers of the Fund. The officers of the Fund, all of whom serve at the
pleasure of the Board of Directors, and, with the exception of Messrs. Manor,
Sechos, Stark and Kozlowski, and Mesdames Bancroft and Sananikome-Fletcher, all
of whom have served since the Fund was organized in 1985, are as follows: Brian
M. Sherman, President; Laurence S. Freedman, Vice President; David Manor (age
56), Treasurer; Ouma Sananikome-Fletcher (age 38), Assistant Vice
President-Chief Investment Officer; Barry G. Sechos (age 35), Assistant
Treasurer; Eugene S. Stark (age 39), Chief Financial Officer & Assistant
Treasurer; Kenneth T. Kozlowski (age 35), Assistant Treasurer; Roy M. Randall
(age 60), Secretary; Allan S. Mostoff (age 64), Assistant Secretary; and
Margaret A. Bancroft (age 58), Assistant Secretary.
The respective principal occupations during the past five years of the
Fund's officers are as follows: Messrs. Sherman and Freedman, shown above in the
table of nominees and Directors under "Proposal 1: Election of Class III
Directors"; David Manor, Executive Director, EquitiLink Limited, Executive
Director, EquitiLink Australia Limited, Director, EquitiLink International
Management Limited, Director, EquitiLink U.S.A., Inc. and Director, President
and Chairman of the Board of First Australia Mutual Funds, Inc. (1989-1991);
Ouma Sananikome-Fletcher, Investment Director, EquitiLink Australia Limited
(since 1994) and Executive Director, Banque Nationale de Paris (1986-1994);
Barry G. Sechos, General Counsel to the EquitiLink Group (since 1993), Director,
EquitiLink Australia Limited (since 1994) and Soliciter, Allen, Allen, & Hemsley
(1986-1993); Eugene S. Stark, First Vice President (since January 1990),
Prudential Mutual Fund Management, Inc.; Kenneth T. Kozlowski, Vice President,
Prudential Mutual Fund Management, Inc. (since 1992) and Fund Accounting
Manager, Pruco-Life Insurance Company (1990-1992); Roy M. Randall, Partner of
Freehill, Hollingdale & Page (Australian law firm); Allan S. Mostoff and
Margaret A. Bancroft, Partners of Dechert Price & Rhoads (U.S. law firm).
Relationship of Directors or Nominees with the Investment Adviser and the
Investment Manager. EquitiLink International Management Limited (the "Investment
Manager") serves as investment manager to the Fund and EquitiLink Australia
Limited (the "Investment Adviser") serves as investment adviser to the Fund
pursuant to a management agreement dated February 1, 1990 and an advisory
agreement dated February 1, 1990.
The Investment Manager is a Jersey, Channel Islands corporation
organized in October 1985 with its registered office located at Union House,
Union Street, St. Helier, Jersey, Channel Islands. The Investment Adviser is a
wholly owned subsidiary of EquitiLink Limited, an Australian corporation. The
registered offices of both the Investment Adviser and EquitiLink Limited are
located at Level 3, 190 George Street, Sydney, N.S.W., Australia. EquitiLink
Limited is a public company whose ordinary shares are listed on the Australian
Stock Exchange Limited.
Messrs. Freedman and Sherman, both Directors of the Fund, serve as
directors of the Investment Manager. Mr. Maddock, a Director of the Fund, is
also chairman and managing director of the Investment Manager. In addition,
Messrs. Freedman and Sherman are the principal shareholders of the Investment
Manager. Messrs. Freedman and Sherman also serve as, respectively, joint
managing director, and joint managing director and chairman, of the Investment
Adviser, and are the principal shareholders of EquitiLink Limited. Mr. Maddock
is also a shareholder of EquitiLink Limited.
During the fiscal year ended October 31, 1996, Professional Consultancy
Services Limited, a limited company organized under the laws of Jersey, Channel
Islands, provided administrative services to the Investment Manager in
connection with its activities on behalf of the Fund and other U.S. and foreign
investment companies and entities in return for a fee in the amount of $240,000.
Mr. Maddock is a director and a principal shareholder of Professional
Consultancy Services Limited.
Compensation of Directors and Certain Officers. The following table sets forth
information regarding compensation of Directors by the Fund and by the fund
complex of which the Fund is a part for the fiscal year ended October 31, 1996.
Officers of the Fund and Directors who are interested persons of the Fund do not
receive any compensation from the Fund or any other fund in the fund complex. In
the column headed "Total Compensation From Registrant and Fund Complex Paid to
Directors," the number in parentheses indicates the total number of boards of
funds in the fund complex on which the Director serves.
<PAGE>
<TABLE>
<CAPTION>
Compensation Table
Fiscal Year Ended 10/31/96
Total
Pension or Compensation
Aggregate Retirement Estimated From Registrant
Compensation Benefits Accrued Annual and Fund
From As Part of Benefits Upon Complex Paid
Name of Person, Position Registrant Fund Expenses Retirement to Directors
- ------------------------ ---------- ------------- ---------- ------------
<S> <C> <C> <C> <C>
Anthony E. Aaronson.................. $7,500 N/A N/A $21,250(2)
John A. Calvert-Jones (through
Sept. 1996)....................... 5,625 N/A N/A 15,938(2)
Sir Roden Cutler..................... 7,500 N/A N/A 29,250(3)
David Lindsay Elsum.................. 7,500 N/A N/A 29,250(3)
Rt. Hon. Malcolm Fraser.............. 7,500 N/A N/A 29,250(3)
Laurence S. Freedman................. 0 N/A N/A 0(3)
Michael R. Horsburgh................. 7,500 N/A N/A 29,250(3)
Harry A. Jacobs, Jr.................. 0 N/A N/A 0(2)
Howard A. Knight..................... 7,500 N/A N/A 21,250(2)
Richard H. McCoy..................... 7,500 N/A N/A 7,500(1)
Roger C. Maddock..................... 0 N/A N/A 0(3)
Neville Miles (since Sept. 1996)..... 1,875 N/A N/A 5,313(2)
William J. Potter.................... 7,500 N/A N/A 29,250(3)
John T. Sheehy....................... 7,500 N/A N/A 29,250(3)
Brian M. Sherman..................... 0 N/A N/A 0(3)
</TABLE>
The Board of Directors recommends that holders of Common Stock vote FOR
the election of the five nominees to the Fund's Board of Directors.
PROPOSAL 2: SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors of the Fund, including a majority of the
Directors who are not interested persons of the Fund, has selected the firm of
Price Waterhouse LLP, independent public accountants, to examine the financial
statements of the Fund for the fiscal year ending October 31, 1997. Such
appointment is now subject to ratification or rejection by the shareholders of
the Fund.
Audit services performed by Price Waterhouse LLP during the most recent
fiscal year included examination of the financial statements of the Fund,
services related to filings with the Securities and Exchange Commission and
consultation on matters performed by such firm related to the preparation and
filing of tax returns. The Fund knows of no direct or indirect financial
interest of such firm in the Fund.
Representatives of Price Waterhouse LLP are expected to be present at
the Meeting and will have the opportunity to respond to questions from
shareholders and to make a statement if they so desire.
The Board of Directors recommends that shareholders vote FOR
ratification of the selection of Price Waterhouse LLP as independent public
accountants for the fiscal year ending October 31, 1997.
OTHER MATTERS
The Board of Directors knows of no business to be brought before the
Meeting other than as set forth above. If, however, any other matters properly
come before the Meeting, it is the intention of the persons named in the
enclosed proxy form to vote such proxies on such matters in accordance with
their best judgment.
<PAGE>
ADDITIONAL INFORMATION
Expenses. The expense of preparation, printing and mailing of the enclosed form
of proxy and accompanying Notice and Proxy Statement will be borne by the Fund.
The Fund will reimburse banks, brokers and others for their reasonable expenses
in forwarding proxy solicitation material to the beneficial owners of the shares
of the Fund. In order to obtain the necessary quorum at the Meeting,
supplementary solicitation may be made by mail, telephone, telegraph or personal
interview. Such solicitation may be conducted by, among others, officers and
employees of the Fund, the Investment Manager, the Investment Adviser or State
Street Bank and Trust Company, the Transfer Agent of the Fund. It is anticipated
that the cost of such supplementary solicitation, if any, will be nominal.
Shareholder Communications Corporation ("SCC") may be retained to assist in the
solicitation of proxies. If retained, SCC will be paid approximately $8,000 by
the Fund and the Fund will reimburse SCC for its related expenses.
Vote Required. The presence in person or by the proxy of the holders of a
majority of the outstanding shares of the Fund is required to constitute a
quorum at the Meeting. Approval of the election of Class III of the Board of
Directors (Proposal 1) and ratification of the selection of the independent
public accountants (Proposal 2) will require the affirmative vote of the holders
of a majority of the outstanding shares present or represented by proxy at the
Meeting. For purposes of determining the presence of a quorum for transacting
business at the Meeting, abstentions and broker "non-votes" (that is, proxies
from brokers or nominees indicating that such persons have not received
instructions from the beneficial owner or other persons entitled to vote shares
on a particular matter with respect to which the brokers or nominees do not have
discretionary power) will be treated as shares that are present but which have
not been voted. For this reason, abstentions and broker non-votes will have the
effect of a "no" vote for purposes of obtaining the requisite approval of each
proposal.
Shareholder Proposals. If a shareholder intends to present a proposal at the
Annual Meeting of Shareholders of the Fund to be held in 1998 and desires to
have the proposal included in the Fund's proxy statement and form of proxy for
that meeting, the shareholder must deliver the proposal to the offices of the
Fund by September 22, 1997.
By Order of the Board of Directors,
Roy M. Randall, Secretary
Gateway Center 3
100 Mulberry Street
Newark New Jersey 07102
January 20, 1997
<PAGE>
PROXY THE FIRST AUSTRALIA FUND, INC. PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
Annual Meeting of Shareholders - March 13, 1997
The undersigned hereby appoints Sir Roden Cutler, Brian M. Sherman and
Laurence S. Freedman, and each of them, the proxies of the undersigned, with
power of substitution to each of them, to vote all shares of the common stock of
The First Australia Fund, Inc. which the undersigned is entitled to vote at the
Annual Meeting of Shareholders of The First Australia Fund, Inc. to be held at
One Seaport Plaza, New York, New York, on March 13, 1997, at 2:00 p.m., New York
City time, and any adjournment thereof.
Unless otherwise specified in the squares provided, the undersigned's
vote will be cast FOR items (1), (2) and (3).
1. The election of five directors to serve as Class III Directors for a
three-year term:
FOR all nominees listed below WITHHOLD AUTHORITY
(except as marked to the contrary below)[ ] to vote for all nominees
listed below [ ]
Nominees: Sir Roden Cutler, David Lindsay Elsum, Laurence S. Freedman,
Michael R. Horsburgh and William J. Potter.
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write the nominee's name on the space provided below.)
2. Ratification of the selection of Price Waterhouse LLP as independent public
accountants.
[ ]FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion on any other business which may properly come before
the meeting or any adjournment thereof.
[ ] FOR DISCRETIONARY AUTHORITY [ ] WITHHOLD DISCRETIONARY AUTHORITY
Please sign exactly as your name or
names appear hereon. When signing as
attorney, executor, administrator,
trustee or guardian, please give your
full title or status.
----------------------------------------
(Signature of Shareholder)
----------------------------------------
(Signature of Joint Tenant, if any)
Date , 1997
PLEASE SIGN AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE
NO POSTAGE IS REQUIRED
<PAGE>
