FIRST FINANCIAL FUND, INC.
GATEWAY CENTER THREE
100 MULBERRY STREET
NEWARK, NEW JERSEY 07102-4077
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
--------------
AUGUST 27, 1998
To our Stockholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders ("Annual
Meeting") of First Financial Fund, Inc. ("Fund") will be held on August 27, 1998
at 10:00 a.m., at the Plaza Building, 751 Broad Street, 21st Floor, Newark, New
Jersey 07102 for the following purposes:
(1) To elect one director to serve until 2001;
(2) To ratify the selection of Price Waterhouse LLP as independent public
accountants of the Fund for the fiscal year ending March 31, 1999; and
(3) To consider and act upon any other business as may properly come
before the Annual Meeting or any adjournment thereof.
Only holders of common stock of record at the close of business on June
12, 1998 are entitled to notice of and to vote at the Annual Meeting or any
adjournment thereof.
By order of the Board of Directors,
/s/Arthur Brown
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ARTHUR J. BROWN
SECRETARY
Dated: June 26, 1998
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YOUR VOTE IS IMPORTANT - PLEASE RETURN YOUR PROXY CARD PROMPTLY
STOCKHOLDERS ARE INVITED TO ATTEND THE ANNUAL MEETING IN PERSON. ANY
STOCKHOLDER WHO DOES NOT EXPECT TO ATTEND THE ANNUAL MEETING IS URGED TO
INDICATE VOTING INSTRUCTIONS ON THE ENCLOSED FORM OF PROXY, DATE AND SIGN IT,
AND RETURN IT IN THE ENVELOPE PROVIDED, WHICH NEEDS NO POSTAGE IF MAILED IN THE
UNITED STATES. IN ORDER TO AVOID THE ADDITIONAL EXPENSE TO THE FUND OF FURTHER
SOLICITATION, WE ASK YOUR COOPERATION IN MAILING YOUR PROXY PROMPTLY, NO MATTER
HOW LARGE OR SMALL YOUR HOLDINGS MAY BE.
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<PAGE>
FIRST FINANCIAL FUND, INC.
GATEWAY CENTER THREE
100 MULBERRY STREET
NEWARK, NEW JERSEY 07102-4077
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PROXY STATEMENT
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ANNUAL MEETING OF STOCKHOLDERS
AUGUST 27, 1998
INTRODUCTION
This Proxy Statement is furnished to the stockholders of First Financial
Fund, Inc. ("Fund") by the Board of Directors of the Fund in connection with the
solicitation of stockholder votes by proxy ("Proxies") to be voted at the Annual
Meeting of Stockholders ("Meeting") to be held on August 27, 1998 at 10:00 a.m.
at the Plaza Building, 751 Broad Street, Newark, New Jersey 07102. The matters
to be acted upon at the Meeting are set forth in the accompanying Notice of
Annual Meeting.
If the enclosed form of Proxy is executed properly and returned, shares
represented by it will be voted at the Meeting in accordance with the
instructions on the Proxy. A Proxy may nevertheless be revoked at any time prior
to its use by written notification received by the Fund, by the execution of a
later dated Proxy or by attending the Meeting and voting in person. However, if
no instructions are specified on a Proxy, shares will be voted FOR the election
of the nominee for director and FOR the other proposals.
The close of business on June 12, 1998 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
Meeting. On that date, the Fund had 20,477,035 shares of common stock
outstanding and entitled to vote. Each share will be entitled to one vote at the
Meeting. It is expected that the Notice of Annual Meeting, Proxy Statement and
form of Proxy first will be mailed to stockholders on or about July 2, 1998.
The solicitation is made primarily by the mailing of this Proxy Statement
and the accompanying Proxy. Supplementary solicitations may be made, without
cost to the Fund, by mail, telephone, telegraph or in person by regular
employees of Prudential Investments Fund Management LLC, the Fund's
Administrator ("Administrator") or the Administrator's affiliate, Prudential
Securities Incorporated ("Prudential Securities"). All expenses in connection
with preparing this Proxy Statement and its enclosures, and additional
solicitation expenses including reimbursement of brokerage firms and others for
their expenses in forwarding proxy solicitation material to the beneficial
owners of shares, will be borne by the Fund. The presence at the Meeting, in
person or by proxy, of stockholders entitled to cast a majority of the shares
outstanding is required for a quorum. In the event that a quorum is present at
the Meeting but sufficient votes to approve one or more of the proposed items
are not received, the persons named as proxies may propose one or more
adjournments of such Meeting to permit further solicitation of Proxies with
respect to those items. Any such adjournments will require the affirmative vote
of a majority of those shares present at the Meeting or represented by proxy. In
such case, the persons named as proxies will vote those Proxies which they are
entitled to vote for any such item in favor of such an adjournment, and will
vote those Proxies required to be voted against any such item against any such
adjournment. A stockholder vote may be taken on one or more of the items in this
Proxy Statement prior to any such adjournment if sufficient votes have been
received and it is otherwise appropriate.
1
<PAGE>
Broker non-votes are shares held in street name for which the broker
indicates that instructions have not been received from the beneficial owners or
other persons entitled to vote and with respect to which the broker does not
have discretionary voting authority. Abstentions and broker non-votes will be
counted as shares present for purposes of determining whether a quorum is
present but will not be voted for or against any adjournment. Accordingly,
abstentions and broker non-votes effectively will be a vote against adjournment
or against any proposal where the required vote is a percentage of the shares
present. Abstentions and broker non-votes will not be counted, however, as votes
cast for purposes of determining whether sufficient votes have been received to
approve a proposal.
Management does not know of any person or group who owned beneficially 5%
or more of the Fund's outstanding common stock on the record date.
ELECTION OF DIRECTORS
PROPOSAL NO. 1
The Board of Directors is divided into three classes with each class
serving for a term of three years and until their successors are elected and
qualified. The Class III director, Mr. McCorkindale, has a term expiring in
1998. The classification of the Fund's directors helps to promote the continuity
and stability of the Fund's management and policies because the majority of the
directors at any given time will have prior experience as directors of the Fund.
At least two stockholder meetings, instead of one, are required to effect a
change in a majority of the directors, except in the event of vacancies
resulting from removal for cause or other reasons, in which case the remaining
directors may fill the vacancies so created.
Accordingly, at the Meeting, one director will be elected to serve until
the Fund's 2001 annual meeting of stockholders and until his successor is
elected and qualified. It is the intention of the persons named in the enclosed
form of Proxy to vote in favor of the election of Mr. McCorkindale as nominee
for director. The nominee is currently a member of the Board of Directors, and
has consented to serve as a director, if elected. The Board of Directors has no
reason to believe that the nominee will become unavailable for election as a
director, but if that should occur before the Meeting, the Proxies will be voted
for such other nominee as the Board of Directors may recommend.
None of the directors is related to one another. The following tables set
forth certain information regarding each of the directors of the Fund. Unless
otherwise noted, each of the directors has engaged in the principal occupation
listed in the following table for five years or more.
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<TABLE>
<CAPTION>
INFORMATION REGARDING NOMINEE
FOR ELECTION AT 1998 ANNUAL MEETING
SHARES OF
COMMON STOCK
NAME, AGE, BUSINESS EXPERIENCE POSITION OWNED ON
DURING THE PAST FIVE YEARS AND OTHER DIRECTORSHIPS WITH THE FUND JUNE 12, 1998(a)
-------------------------------------------------- ---------------- ------------------
CLASS III (TERM EXPIRING IN 2001, IF ELECTED)
<S> <C> <C>
Douglas H. McCorkindale (59), Vice Chairman (since March 1984) and President Director 0
(since September 1997), Gannett Co. Inc. (publishing and media); Director,
Continental Airlines, Inc., Frontier Corporation, Gannett Co. Inc., Global
Utility Fund, Inc., Prudential Distressed Securities Fund, Inc., Prudential
Emerging Growth Fund, Inc., Prudential Equity Fund, Inc., Prudential Global
Limited Maturity Fund, Inc., Prudential Intermediate Global Income Fund,
Inc., Prudential International Bond Fund, Inc., Prudential Jennison Series
Fund, Inc., Prudential Multi-Sector Fund, Inc., Prudential Small-Cap Quantum
Fund, Inc., Prudential Small Company Value Fund, Inc., Prudential Utility
Fund, Inc., The Global Total Return Fund, Inc., The High Yield Plus Fund,
Inc.; Trustee, The Target Portfolio Trust, Prudential Balanced Fund,
Prudential Equity Income Fund, Prudential Index Series Fund, Prudential
Mid-Cap Value Fund, Prudential Real Estate Fund, Prudential 20/20 Focus
Fund.
INFORMATION REGARDING DIRECTORS
WHOSE CURRENT TERMS CONTINUE
SHARES OF
COMMON STOCK
NAME, AGE, BUSINESS EXPERIENCE POSITION OWNED ON
DURING THE PAST FIVE YEARS AND OTHER DIRECTORSHIPS WITH THE FUND JUNE 12, 1998(a)
-------------------------------------------------- ---------------- ------------------
CLASS I (TERM EXPIRING IN 1999)
Eugene C. Dorsey (71), Retired President, Chief Executive Officer and Trustee, Director 480
Gannett Foundation (now Freedom Forum); former Publisher, four Gannett
newspapers and Vice President of Gannet Co, Inc.; past Chairman, Independent
Sector, Washington, D.C. (largest national coalition of philanthropic
organizations); Former Director, Advisory Board of Chase Manhattan Bank of
Rochester; Director, Global Utility Fund, Inc., Prudential Diversified Bond
Fund, Inc., Prudential Government Income Fund, Inc., Prudential High Yield
Fund, Inc., Prudential High Yield Total Return Fund, Inc., Prudential
Mortgage Income Fund, Inc., Prudential Municipal Series Fund, Inc.,
Prudential National Municipals Fund, Inc., Prudential Structured Maturity
Fund, Inc., The High Yield Plus Fund, Inc.; Trustee, The Target Portfolio
Trust, Prudential California Municipal Fund, Prudential Government
Securities Trust, Prudential Municipal Bond Fund.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
SHARES OF
COMMON STOCK
NAME, AGE, BUSINESS EXPERIENCE POSITION OWNED ON
DURING THE PAST FIVE YEARS AND OTHER DIRECTORSHIPS WITH THE FUND JUNE 12, 1998(a)
-------------------------------------------------- ---------------- ------------------
CLASS II (TERM EXPIRING IN 2000)
<S> <C> <C>
*Thomas T. Mooney (56), President, Greater Rochester Metro Chamber of Commerce; President, 2,450
former Rochester City Manager; Trustee, Center for Governmental Research, Treasurer and
Inc., The Target Portfolio Trust, Prudential Balanced Fund, Prudential Director
California Municipal Fund, Prudential Equity Income Fund, Prudential
Government Securities Trust, Prudential Index Series Fund, Prudential
Mid-Cap Value Fund, Prudential Municipal Bond Fund, Prudential Real Estate
Fund, Prudential 20/20 Focus Fund; Director, Blue Cross of Rochester,
Executive Service Corps of Rochester, Monroe County Industrial Development
Corporation, Monroe County Water Authority, Northeast Midwest Institute,
Rochester Jobs, Inc., The Business Council of New York State, Global Utility
Fund, Inc., Prudential Distressed Securities Fund, Inc., Prudential
Diversified Bond Fund, Inc., Prudential Emerging Growth Fund, Inc.,
Prudential Equity Fund, Inc., Prudential Global Limited Maturity Fund, Inc.,
Prudential Government Income Fund, Inc., Prudential High Yield Fund, Inc.,
Prudential High Yield Total Return Fund, Inc., Prudential Intermediate
Global Income Fund, Inc., Prudential International Bond Fund, Inc.,
Prudential Jennison Series Fund, Inc., Prudential Mortgage Income Fund,
Inc., Prudential Multi-Sector Fund, Inc., Prudential Municipal Series Fund,
Inc., Prudential National Municipals Fund, Inc., Prudential Small-Cap
Quantum Fund, Inc., Prudential Small Company Value Fund, Inc., Prudential
Structured Maturity Fund, Inc., Prudential Utility Fund, Inc., The Global
Total Return Fund, Inc., The High Yield Income Fund, Inc.; President,
Treasurer and Director, The High Yield Plus Fund, Inc.
</TABLE>
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* Indicates "interested person" of the Fund as defined in the Investment
Company Act of 1940, as amended ("1940 Act"). Mr. Mooney is deemed to be an
"interested person" by reason of his service as an officer of the Fund.
(a) For this purpose, "beneficial ownership" is defined in the regulations
under Section 13(d) of the Securities Exchange Act of 1934, as amended
("1934 Act"). The information is based on statements furnished by the
Administrator and the nominee.
The directors and officers of the Fund as a group (five persons) owned
beneficially less than 1% of the outstanding shares of the Fund as of June 12,
1998. This includes shares shown with respect to the directors in the tables
above.
Under Section 16(a) of the 1934 Act, Section 30(h) of the 1940 Act and
Securities and Exchange Commission ("SEC") regulations thereunder, the Fund's
officers and directors, persons owning more than 10% of the Fund's common stock
and certain officers and partners of Wellington Management Company, LLP, the
Fund's investment adviser ("Investment Adviser"), are required to report their
transactions in the Fund's common stock to the SEC, New York Stock Exchange and
the Fund. Based solely on the Fund's review of the copies of such reports
received by it, the Fund believes that, during its fiscal year ended March 31,
1998, all filing requirements applicable to such persons were complied with.
4
<PAGE>
BOARD OF DIRECTORS AND COMMITTEE MEETINGS.
The Board of Directors met four times during the Fund's fiscal year ended
March 31, 1998, and each director during the time he served attended at least
75% of the total number of meetings of the Board and of any committee of which
he was a member. The Board of Directors has an Audit Committee currently
composed of Messrs. Dorsey, McCorkindale, and Mooney. Mr. Mooney is deemed to be
an "interested person" of the Fund because he is an officer of the Fund. The
Audit Committee also reviews with the independent public accountants the plan
and results of the audit engagement and matters having a material effect upon
the Fund's financial operations. The Audit Committee met twice during the fiscal
year ended March 31, 1998. The Board of Directors does not have a standing
nominating or compensation committee.
OFFICERS OF THE FUND.
The officers of the Fund, other than as shown above who also serve as
directors, are:
Arthur J. Brown (age 49)--Secretary; Partner, Kirkpatrick & Lockhart LLP
(law firm). Kirkpatrick & Lockhart LLP serves as counsel to the Fund and to
Wellington Management Company, LLP on certain matters.
Stephanie A. Djinis (age 34)--Assistant Secretary; Partner, Kirkpatrick &
Lockhart LLP.
Mr. Brown has held office since May 1, 1986. Ms. Djinis has held office
since February 14, 1990. The officers of the Fund are elected annually by the
Board of Directors at its next meeting following the annual meeting of
stockholders.
COMPENSATION OF DIRECTORS.
The table below includes certain information relating to the compensation
of the Fund's directors paid by the Fund for the fiscal year ended March 31,
1998 as well as information regarding compensation from the "Fund Complex," as
defined below, for the calendar year ended December 31, 1997. No additional
compensation is paid to Board members for serving on committees or for attending
meetings. Board members are reimbursed for any expenses incurred in attending
meetings and for other incidental expenses. Annual Board fees may be reviewed
periodically and changed by each Fund's Board.
<TABLE>
<CAPTION>
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COMPENSATION TABLE
- ------------------------------------------------------------------------------------------------------------------------------------
Pension or Total
Retirement Compensation
Benefits Estimated From the
Accrued as Annual Fund and
Aggregate Part of the Benefits the Fund
Compensation Fund's Upon Complex Paid
Name of Director From the Fund Expenses Retirement to Directors
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Eugene C. Dorsey+ $4,875 N/A N/A $21,000(4)*
- ------------------------------------------------------------------------------------------------------------------------------------
Douglas H. McCorkindale 4,875 N/A N/A 21,000(4)*
- ------------------------------------------------------------------------------------------------------------------------------------
Thomas T. Mooney 4,875 N/A N/A 21,000(4)*
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</TABLE>
* Parenthetical indicates number of funds (including the Fund) in the Fund
Complex, comprised of four investment companies, to which aggregate
compensation relates.
+ All compensation from the Fund and Fund Complex for the calendar year ended
December 31, 1997 represents deferred compensation. Mr. Dorsey received
aggregate compensation for that period from the Fund and the Fund Complex,
including accrued interest, in the amounts of approximately $4,899 and
$24,287, respectively.
5
<PAGE>
Directors must be elected by a vote of the holders of a plurality of the
shares present at the Meeting in person or by proxy and entitled to vote
thereon.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL NO. 1.
SELECTION OF INDEPENDENT ACCOUNTANTS
PROPOSAL NO. 2
The Board of Directors, including a majority of those directors who are
not interested persons (as such term is defined in the 1940 Act) of the Fund or
the Investment Adviser ("Independent Directors"), selected Price Waterhouse LLP
to continue to serve as the independent accountants for the Fund for the current
fiscal year, ending March 31, 1999. As of July 1, 1998 Price Waterhouse LLP will
be renamed Price Waterhouse Coopers LLP. Such appointment is now subject to
ratification or rejection by stockholders of the Fund. In addition, as required
by the 1940 Act, the vote of the Board of Directors is subject to the right of
the Fund, by the vote of a majority of its outstanding voting securities, (as
such term is defined in the 1940 Act) to terminate such engagement without
penalty at any meeting called for the purposes of voting thereon.
Price Waterhouse LLP currently serves as the Fund's independent
accountants, and has audited the Fund's financial statements for the fiscal
years ended March 31, 1997 and 1998. Prior thereto, Deloitte & Touche LLP served
as the Fund's independent accountants. On February 18, 1997, the Fund's Board of
Directors, acting upon the recommendation of its Audit Committee, appointed
Price Waterhouse LLP to serve as independent accountants to the Fund, to succeed
Deloitte & Touche LLP. These actions were not taken because of any disagreement
between the Fund and Deloitte & Touche LLP. The reports of Deloitte & Touche LLP
on the Fund's financial statements for the fiscal years ended March 31, 1995 and
1996 did not contain adverse opinions, disclaimers, qualifications or
modifications of opinion. Deloitte & Touche LLP did not disagree during such
fiscal years or the subsequent interim period prior to its resignation, on any
matter of accounting principles or practices, financial statement disclosure,
auditing scope or procedure, which disagreements, if not resolved to its
satisfaction, would have caused it to make reference to the subject matter of
the disagreements in connection with its reports on those financial statements.
The Fund is not aware of any "reportable events," as that term is used in the
federal securities laws, during its fiscal years ended March 31, 1995 and 1996
or the subsequent interim period.
Price Waterhouse LLP has informed the Fund that it has no material direct
or indirect financial interest in the Fund. No representative of Price
Waterhouse LLP is expected to be present at the Meeting. The Audit Committee
will review and approve services provided by the independent accountants prior
to their being rendered, and will report to the Board of Directors concerning
all such services after they have been performed.
An affirmative vote of a majority of the shares present, in person or by
proxy, at the Meeting is required for ratification.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL NO. 2.
OTHER MATTERS
No business, other than as set forth above, is expected to come before
the Meeting. Should any other matters requiring a vote of stockholders properly
come before the Meeting, the persons named in the enclosed Proxy will vote
thereon in accordance with their best judgment in the interests of the Fund.
WELLINGTON MANAGEMENT COMPANY, LLP
Wellington Management Company, LLP, 75 State Street, Boston,
Massachusetts 02109, is the Fund's Investment Adviser. The Investment Adviser is
a Massachusetts limited liability partnership of which the follow-
6
<PAGE>
ing persons are managing partners: Robert M. Doran, Duncan M. McFarland and John
R. Ryan. The Investment Adviser is a professional investment counseling firm
which provides investment services to investment companies, employee benefit
plans, endowment funds, foundations and other institutions and individuals. As
of March 31, 1998, the Investment Adviser held discretionary investment
authority over approximately $194 billion of assets. The Investment Adviser and
its predecessor organizations have provided investment advisory services to
investment companies since 1933 and to investment counseling clients since 1960.
The Investment Adviser is not affiliated with the Administrator. Prudential
Investments Fund Management LLC, the Fund's Administrator, is located at Gateway
Center Three, 100 Mulberry Street, Newark, New Jersey, 07102.
STOCKHOLDER PROPOSALS
If a stockholder intends to present a proposal at the Fund's annual meeting
of stockholders in 1999 and desires to have the proposal included in the Fund's
proxy statement and form of proxy for that meeting, the stockholder must deliver
the proposal to the offices of the Fund at Gateway Center Three, 100 Mulberry
Street, Newark, New Jersey 07102 by March 4, 1999. Stockholder proposals that
are submitted in a timely manner will not necessarily be included in the Fund's
proxy materials. Inclusion of such proposal is subject to limitation under the
federal securities laws.
NOTICE TO BANKS, BROKER-DEALERS AND VOTING TRUSTEES AND THEIR NOMINEES
Please advise the Fund, at Gateway Center Three, 100 Mulberry Street,
Newark, New Jersey 07102, whether other persons are beneficial owners of shares
for which Proxies are being solicited and if so, the number of copies of the
Proxy Statement you wish to receive in order to supply copies to the beneficial
owners of shares.
By Order of the Board of Directors,
/s/Arthur Brown
---------------
ARTHUR J. BROWN
SECRETARY
Dated: June 26, 1998
7
<PAGE>
=======================================
First Financial Fund, Inc.
[LOGO]
First
Financial
Fund, Inc.
==============================
PROXY
STATEMENT
NOTICE OF
ANNUAL MEETING
TO BE HELD ON
AUGUST 27, 1998
AND
PROXY STATEMENT
<PAGE>
PROXY
FIRST FINANCIAL FUND, INC.
Gateway Center Three
100 Mulberry Street
Newark, New Jersey 07102-4077
This proxy is Solicited on Behalf of the Board of Directors
The undersigned hereby appoints Thomas T. Mooney and Stephanie A. Djinis as
Proxies, each with the power of substitution, and hereby authorizes each of them
to represent and to vote, as designated on the reverse side of this card, all
the shares of common stock of First Financial Fund, Inc. (the "Fund") held of
record on June 12, 1998 at the Annual Meeting of Stockholders to be held on
August 27, 1998, or any adjournment thereof.
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PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
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HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
- ------------------------------------ -------------------------------------
- ------------------------------------ -------------------------------------
- ------------------------------------ -------------------------------------
<PAGE>
- --- PLEASE MARK VOTES
X AS IN THIS EXAMPLE
- --- The Board of Directors recommends a vote
- ------------------------------- "FOR" the nominee and "FOR" each of the
FIRST FINANCIAL FUND., INC. following Proposals:
- -------------------------------
1. ELECTION OF DIRECTOR FOR WITHHELD
Nominee: --- ---
This Proxy, when properly executed, Douglas H. McCorkindale --- ---
will be voted in the manner directed
by the undersigned shareholder. If
no direction is made, this proxy will
be voted FOR Proposals 1, 2 and 3.
FOR AGAINST ABSTAIN
2. To ratify the --- --- ---
selection of Price --- --- ---
Waterhouse LLP as
independent public
accountants for the
fiscal year ending
March 31, 1999.
FOR AGAINST ABSTAIN
2. To consider and --- --- ---
act upon such --- --- ---
other business as
may properly come
before the meeting
and any adjournments
thereof.
Please be sure to sign ------------
and date this Proxy. Date Mark box at right if an address ---
- ------------------------------------ change or comment has been noted
on the reverse side of this card. ---
- ---Stockholder sign here------------
- ---Co-owner sign here--------------- RECORD DATE SHARES:
