-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OnPkN5d+mdr2zjm2FimDLqylq0bK5WcMrrErodypBfvzhCk7SykXet4jtH6Nte3o jeHXnJxOFYnPH+9DiAk79w== 0000898733-01-500538.txt : 20020412 0000898733-01-500538.hdr.sgml : 20020412 ACCESSION NUMBER: 0000898733-01-500538 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010930 FILED AS OF DATE: 20011129 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST FINANCIAL FUND INC CENTRAL INDEX KEY: 0000790202 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 133341573 STATE OF INCORPORATION: MD FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-04605 FILM NUMBER: 1802484 BUSINESS ADDRESS: STREET 1: GATEWAY ENTER THREE 100 MULBERRY ST CITY: NEWARK STATE: NJ ZIP: 07102-4077 BUSINESS PHONE: 2013677530 MAIL ADDRESS: STREET 1: GATEWAY CENTER THREE 100 MULBERRY STREET CITY: NEWARK STATE: NJ ZIP: 07102-4077 FORMER COMPANY: FORMER CONFORMED NAME: FIRST SAVINGS & BANKING INSTITUTIONS FUND INC DATE OF NAME CHANGE: 19860402 N-30D 1 mf15129.txt FIRST FINANCIAL FUND -- 9/30/01 (LOGO) SEMI ANNUAL REPORT September 30, 2001 Letter To Shareholders November 1, 2001 Dear Fellow Shareholder: We cannot begin this review to you without acknowledging a debt. Building over the last 18 years of my professional career, this debt consists of the stellar research, true grit and integrity of a number of brokerage firms. Chief among them were Sandler O'Neill and Keefe, Bruyette and Woods. The professionals of these firms are financial service industry specialists who know their craft like none before them. They are, in short, world class. That so many of them perished on September 11th is the kind of loss that is beyond comprehension--beyond my understanding, that is--a loss we suffer for a long time and in bits because the whole of it is too much today. That so many are so missed is consolation, even inspiration--a charge to cherish our lives and one another a little more. TOTAL RETURN For The Periods Ended 9/30/01 6 Mos. 1 Year 3 Years 5 Years First Financial Fund's NAV1 11.0% 34.6% 13.1% 12.1% S&P 500 -9.7 -26.6 2.0 10.2 NASDAQ Composite* -18.6 -59.2 -4.0 4.1 NASDAQ Banks* 9.4 15.8 6.0 12.4 SNL All Daily Thrift* 7.8 32.8 13.6 17.3 SNL MBS REITS 26.8 35.9 -3.5 1.4 SNL Mortgage Banks* 3.2 55.5 1.3 -5.3 1 Past performance is not indicative of future results. Returns based on market performance of the Fund's shares would be different. * Principal only. Note: Returns for periods greater than one year are annualized. Financially, we enjoyed a fine six- month period. This was not so for the stock market in general. Our basic bet, namely, more interest rate risk and limited credit risk paid off. The yield curve has steepened dramatically as the Federal Reserve fought to revive a slowing economy, which probably entered the beginning of a recession in the second week of September. At this point, all eyes are on consumers to see whether they will save or spend the tax cuts and the added cash from mortgage refinancing. Though the stock market of late suggests otherwise, we feel the risk is for a more protracted slowdown and reliquefaction process. We would still eschew credit risk and favor the beneficiaries of a steep yield curve. However, as we are nearer to an inflection point, we prefer to stay more liquid and keep our concentration levels down. This will allow greater flexibility as events unfold. Flexibility may be our and our companies' most valuable asset over the next several quarters. 1 We continue to owe you, our shareholders, a debt of gratitude as well. These are not easy days to be an investor in equities. For our part, we see a multitude of opportunities in such volatile markets. If ever there was a time to run a small and flexible portfolio within a large firm with substantial resources, this is it. We thank you for being there with us. Thank you for your trust in us. Nicholas C. Adams 2 Portfolio of Investments as of September 30, 2001 (Unaudited) FIRST FINANCIAL FUND, INC. - ------------------------------------------------------------ - ------------------------------------------------------------
Shares Description Value (Note 1) - ------------------------------------------------------------ LONG-TERM INVESTMENTS--83.9% COMMON STOCKS--82.6% - ------------------------------------------------------------ Banks & Thrifts--44.6% 12,800 Abington Bancorp, Inc. $ 172,160 34,600 Algiers Bancorp, Inc. 301,020 129,200 Astoria Financial Corp. 7,656,392 703,250 Bay View Capital Corp. 4,922,750 125,300 Bostonfed Bancorp, Inc. 2,856,840 64,640 Broadway Financial Corp. 749,824 225,500 Capital Crossing Bank* 4,038,705 86,600 CBES Bancorp, Inc. 1,125,800 142,538 CCF Holding Co. 2,227,869 101,900 Commerce Bancorp, Inc. 6,929,200 118,000 Commercial Bank New York 3,858,600 60,000 Community Bank San Jose California(a) 1,938,600 155,500 Community Financial Corp. 2,239,200 308,700 Connecticut Bancshares, Inc. 6,822,270 195,000 Dime Bancorp, Inc. 48,750 275,500 Downey Financial Corp. 12,157,815 370,486 Fidelity Federal Bancorp 1,352,274 64,380 Fifth Third Bancorp 3,958,082 29,000 First Financial Corp. 514,750 319,150 First Republic Bank 7,324,493 313,500 FirstFed America Bancorp, Inc. 5,454,900 252,000 FirstFed Bancorp, Inc. 1,638,000 39,600 Firstfed Financial Corp. 1,029,600 124,400 Golden State Bancorp, Inc. 3,781,761 291,400 Hawthorne Financial Corp.* 5,594,880 19,999 HFB Financial Corp. 241,588 50,000 Hibernia Corp. 817,500 19,500 Iberiabank Corp. 557,700 41,600 Lincoln Bancorp 640,640 42,000 M & T Bankcorp. 3,108,000 186,400 Macatawa Bank Corp. 3,112,880 33,300 Mercantile Bank Corp.* 547,785 219,600 MetroCorp Bancshares, Inc. 2,507,832 224,000 North Valley Bancorp 2,878,400 210,000 Northeast Pennsylvania Financial Corp. 3,034,500 213,200 Pacific Century Financial Corp.* 4,982,484 102,900 Pacific Crest Capital, Inc. 1,924,230 341,660 Pacific Union Bank* 3,621,596 34,600 Peoples Financial Corp. 281,990 165,930 Perpetual Federal Savings Bank 2,522,136 345,000 Port Financial Corp. $ 8,238,600 94,900 PrivateBankcorp, Inc.* 1,508,910 317,300 Provident Financial Holdings, Inc.* 7,535,875 40,650 Redwood Financial, Inc.* 447,150 45,000 River Valley Bancorp 900,900 47,800 Rowan Bancorp, Inc.* 812,600 210,000 Southwest Bancorp, Inc. 3,213,000 32,500 St. Landry Financial Corp.(a)* 357,500 21,100 Team Financial, Inc. 173,864 345,800 Thistle Group Holdings Co.* 3,146,780 100,700 Unionbancal Corp. 3,407,688 172,000 Woronoco Bancorp, Inc.* 2,958,400 ------------ 152,175,063 ------------ - ------------------------------------------------------------ Other Financial Intermediaries--21.3% 762,800 America First Mortgage Investments, Inc. 6,750,780 125,600 American Home Mortgage Holdings, Inc. 2,191,720 42,730 American International Group, Inc. 3,332,955 210,000 American Physicians Capital, Inc. 4,361,700 170,700 Annaly Mortgage Management, Inc. 2,466,615 167,500 Anthracite Capital, Inc. 1,742,000 574,200 Banner Central Finance Co. 717,750 157,500 E*Trade Group, Inc.* 952,875 42,000 Fannie Mae 3,362,520 227,875 First Mortgage Corp.* 820,350 155,504 Fortress Investment Corp.(a) 2,897,040 430,053 Hanmi Financial Corp.* 5,848,721 272,590 Healthcare Financial Partners, Inc.(a) 4,034,332 574,200 Hispanic Express, Inc. 677,556 128,200 IndyMac Bancorp, Inc. 3,475,502 161,600 Landamerica Financial Group, Inc. 5,373,200 72,500 Legg Mason, Inc. 2,882,600 570,200 Ocwen Financial Corp.* 4,111,142 401,600 RAIT Investment Trust 6,405,520 959,315 Resource America, Inc. 8,576,276 77,595 Vista Bancorp, Inc. 1,454,906 13,500 Willis Group Holdings Ltd.* 315,765 ------------ 72,751,825 ------------
- -------------------------------------------------------------------------------- See Notes to Financial Statements. 3 Portfolio of Investments as of September 30, 2001 (Unaudited) FIRST FINANCIAL FUND, INC. - ------------------------------------------------------------ - ------------------------------------------------------------
Shares Description Value (Note 1) - ------------------------------------------------------------ Rental Services--1.6% 242,200 Rental-A-Center, Inc. $ 5,631,150 ------------ - ------------------------------------------------------------ Savings & Loan--15.1% 87,500 Brookline Bancorp, Inc. 1,312,500 71,800 Chesterfield Financial Corp.* 1,076,282 238,500 Citizens First Bancorp, Inc. 3,541,725 259,700 Fidelity Bankshares, Inc. 3,466,995 35,500 First Bell Bancorp, Inc. 518,300 170,000 First Federal Bancshares, Inc. 2,638,400 184,400 Floridafirst Bancorp, Inc. 3,081,324 294,000 Golden West Financial Corp. 17,081,400 146,900 Hudson City Bancorp, Inc. 3,510,910 357,300 Independence Community Bank Corp. 7,764,129 51,300 Ledger Capital Corp. 912,114 33,000 Northwest Bancorp, Inc. 330,330 100,000 Parkvale Financial Corp. 2,195,000 139,700 Quaker City Bancorp, Inc. 4,189,603 ------------ 51,619,012 ------------ Total common stocks (cost $242,432,683) 282,177,050 ------------ Principal Amount (000) - ------------------------------------------------------------ Convertible Bonds--1.3% $ 5,000 E*Trade Group, Inc., 6.75%, 5/15/08 3,893,750 1,000 Online Resources & Communications, 8.00%, 9/30/05 520,000 ------------ Total convertible bonds (cost $5,991,591) 4,413,750 ------------ Total long-term investments (cost $248,424,274) 286,590,800 ------------
Principal Amount (000) Description Value (Note 1) - ------------------------------------------------------------ SHORT-TERM INVESTMENTS--14.7% Repurchase Agreement--14.7% $ 49,489 Paribas Corp., 3.00 %, dated 9/28/2001, due 10/1/2001 in the amount of $49,501,372 (cost $49,489,000; collateralized by $24,762,000 U.S. Treasury Notes, 6.50%, due 2/28/02, value of collateral including interest $25,254,399 and by 21,270,000 U.S. Treasury Bonds, 9.125%, due 5/15/09, value of collateral including interest-$25,217,321) $ 49,489,000 636 Paribas Corp., 3.25%, dated 9/28/2001, due 10/1/2001 in the amount of $636,172 (cost $636,000; collateralized by 647,000 U.S. Treasury Bonds, 5.50%, due 8/15/28, value of collateral including interest-$648,130) 636,000 ------------ Total repurchase agreements (cost $50,125,000) 50,125,000 ------------ - ------------------------------------------------------------ Certificates of Deposit 2 Brookline Savings, 4.00%, 11/25/01 1,530 22 First Federal Savings Bank, 3.75%, 10/12/01 22,465 22 Naugatuck Valley Savings & Loan Assoc., 3.00%, 10/26/01 21,916 ------------ Total certificates of deposit (cost $45,911) 45,911 ------------ Total short-term investments (cost $50,170,911) 50,170,911 ------------ - ------------------------------------------------------------ Total Investments--98.6% (cost $298,595,185; Note 3) 336,761,711 Other assets in excess of liabilities--1.4% 4,731,028 ------------ Net Assets--100% $341,492,739 ------------ ------------
- -------------- * Non-income producing security. (a) Indicates a fair valued security. - -------------------------------------------------------------------------------- See Notes to Financial Statements. 4 Statement of Assets and Liabilities (Unaudited) FIRST FINANCIAL FUND, INC. - --------------------------------------------------------------------------------
Assets September 30, 2001 Investments, at value (cost $248,470,185).............................................................. $286,636,711 Repurchase agreement, at value (cost $50,125,000)...................................................... 50,125,000 Cash................................................................................................... 694 Receivable for investments sold........................................................................ 4,988,212 Dividends and interest receivable...................................................................... 834,317 Other assets........................................................................................... 156,205 ------------------ Total assets........................................................................................ 342,741,139 ------------------ Liabilities Advisory fee payable................................................................................... 555,181 Payable for investments purchased...................................................................... 418,535 Administration fee payable............................................................................. 123,992 Accrued expenses....................................................................................... 118,704 Deferred directors' fees............................................................................... 31,988 ------------------ Total liabilities................................................................................... 1,248,400 ------------------ Net Assets............................................................................................. $341,492,739 ------------------ ------------------ Net assets were comprised of: Common stock, at par; 25,064,981 shares issued...................................................... $ 25,065 Paid-in capital in excess of par.................................................................... 278,076,064 Cost of 1,154,194 shares held in treasury........................................................... (12,475,875) ------------------ 265,625,254 Undistributed net investment income................................................................. 4,316,048 Accumulated net realized gains...................................................................... 33,384,911 Net unrealized appreciation on investments.......................................................... 38,166,526 ------------------ Net assets, September 30, 2001...................................................................... $341,492,739 ------------------ ------------------ Net asset value per share ($341,492,739 / 23,910,787 shares of common stock outstanding)............... $14.28 ------------------ ------------------
- -------------------------------------------------------------------------------- See Notes to Financial Statements. 5 FIRST FINANCIAL FUND, INC. Statement of Operations (Unaudited) - ------------------------------------------------------------
Six Months Ended Net Investment Income September 30, 2001 Income Dividends............................. $ 2,654,592 Interest.............................. 1,355,348 ------------------ Total income....................... 4,009,940 ------------------ Expenses Investment advisory fee............... 1,095,837 Administration fee.................... 255,501 Legal fees and expenses............... 100,000 Commitment fees....................... 98,000 Reports to shareholders............... 65,000 Custodian's fees and expenses......... 38,000 Transfer agent's fees and expenses.... 17,000 Listing fees.......................... 14,000 Directors fees........................ 12,000 Audit fee............................. 10,000 Miscellaneous......................... 49,151 ------------------ Total expenses..................... 1,754,489 ------------------ Net investment income.................... 2,255,451 ------------------ Realized and Unrealized Gain (Loss) on Investments Net realized gain on investment transactions.......................... 33,858,676 Net change in unrealized appreciation of investments........................... (2,304,267) ------------------ Net gain on investments.................. 31,554,409 ------------------ Net Increase in Net Assets Resulting from Operations................ $ 33,809,860 ------------------ ------------------
FIRST FINANCIAL FUND, INC. Statement of Changes in Net Assets (Unaudited) - ------------------------------------------------------------
Six Months Ended September Year Ended Increase in 30, March 31, Net Assets 2001 2000 Operations Net investment income....... $ 2,255,451 $ 3,434,275 Net realized gain on investment transactions............. 33,858,676 15,308,555 Net change in unrealized appreciation of investments.............. (2,304,267) 85,599,520 ------------ ------------ Net increase in net assets resulting from operations............... 33,809,860 104,342,350 ------------ ------------ Dividends and distributions (Note 1) Dividends from net investment income........ -- (2,462,878) Cost of Fund shares reacquired.................. (7,709,459) (1,148,855) ------------ ------------ Total increase................. 26,100,401 100,730,617 Net Assets Beginning of period............ 315,392,338 214,661,721 ------------ ------------ End of period(a)............... $341,492,739 $315,392,338 ------------ ------------ ------------ ------------ - --------------- (a) Includes undistributed net investment income of........ $ 4,316,048 $ 2,060,597 ------------ ------------
- -------------------------------------------------------------------------------- See Notes to Financial Statements. 6 Notes to Financial Statements (Unaudited) FIRST FINANCIAL FUND, INC. - -------------------------------------------------------------------------------- First Financial Fund, Inc. (the 'Fund') was incorporated in Maryland on March 3, 1986, as a closed-end, diversified investment company. The Fund's primary investment objective is to achieve long-term capital appreciation with the secondary objective of current income by investing in securities issued by savings and banking institutions, mortgage banking institutions and their holding companies. The ability of issuers of debt securities held by the Fund to meet their obligations may be affected by economic developments in a specific industry or region. - ------------------------------------------------------------ Note 1. Accounting Policies The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. Securities Valuation: Securities for which market quotations are readily available--including securities listed on national securities exchanges and those traded over-the-counter--are valued at the last quoted sales price on the valuation date on which the security is traded. If such securities were not traded on the valuation date, but market quotations are readily available, they are valued at the most recently quoted bid price provided by an independent pricing service or by principal market makers. Securities for which market quotations are not readily available will be valued at fair value as determined in good faith by or under the direction of the Board of Directors of the Fund. Short-term securities which mature in more than 60 days are valued at current market quotations. Short-term securities which mature in 60 days or less are valued at amortized cost. All securities are valued as of 4:15 p.m., New York time. Repurchase Agreement: In connection with repurchase agreement transactions with financial institutions, it is the Fund's policy that its custodian take possession of the underlying collateral securities, the value of which exceeds the principal amount of the repurchase transactions, including accrued interest. To the extent that any repurchase transaction exceed one business day, the value of the collateral is marked-to-market on a daily basis to ensure the adequacy of collateral. If the seller defaults, and the value of the collateral declines or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by the Fund may be delayed or limited. Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains or losses on sales of securities are calculated on the identified cost basis. Dividend income is recorded on the ex-dividend date; interest income is recorded on the accrual basis. Expenses are recorded on the accrual basis, which may require the use of certain estimates by management. Federal Income Taxes: It is the Fund's policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income to shareholders. Therefore, no federal income tax provision is required. Dividends and Distributions: The Fund expects to declare and pay dividends from net investment income and any net capital gains, if any, annually. Dividends and distributions are recorded on the ex-dividend date. Income distributions and capital gain distributions are determined in accordance with income tax regulations which may differ from generally accepted accounting principles. - ------------------------------------------------------------ Note 2. Agreements The Fund has agreements with Wellington Management Company, LLP (the 'Investment Adviser') and with Prudential Investments LLC (the 'Administrator'), formerly Prudential Investments Fund Management LLC. The Investment Adviser makes investment decisions on behalf of the Fund; the Administrator provides occupancy and certain clerical and accounting services to the Fund. The Fund bears all other costs and expenses. The investment advisory agreement provides for the Investment Adviser to receive a fee, computed monthly and payable quarterly, at the following annual rates: .75% of the Fund's average month-end net assets up to and including $50 million, and .625% of such assets in excess of $50 million. The administration agreement provides for the Administrator to receive a fee, computed monthly and payable quarterly, at the annual rate of .15% of the Fund's average month-end net assets. The Fund has entered into a credit agreement with an unaffiliated lender. The maximum commitment under the agreement is $45 million. Interest on any such borrowings will be at market rates. The Fund also pays a variable commitment fee on the unused portion of the credit facility. The commitment fee is accrued daily and paid quarterly. The expiration date of the credit agreement is April 29, 2002. The Fund did not borrow any amounts pursuant to the credit agreement during the period ended September 30, 2001. - ------------------------------------------------------------ Note 3. Portfolio Securities Purchases and sales of investment securities, other than short-term investments, for the six months ended September 30, 2001 were $173,584,391 and $165,900,154, respectively. - -------------------------------------------------------------------------------- 7 Notes to Financial Statements (Unaudited) FIRST FINANCIAL FUND, INC. - -------------------------------------------------------------------------------- The cost basis of the Fund's investments for federal income tax purposes, including short-term investments, at September 30, 2001 was $298,668,101; and, accordingly, net unrealized appreciation for federal income tax purposes was $38,093,610 (gross unrealized appreciation--$47,957,782; gross unrealized depreciation--$9,864,172). - ------------------------------------------------------------ Note 4. Capital There are 50 million shares of $.001 par value common stock authorized. Of the 25,064,981 shares issued as of September 30, 2001, the Investment Adviser owned 10,994 shares. During the year ended March 31, 2001, the Fund repurchased 104,094 of its own shares at a weighted average discount of 15.2%. During the six months ended September 30, 2001, the Fund repurchased 613,900 of its own shares at a weighted average discount of 14.8%. - ------------------------------------------------------------ Note 5. Dividends On November 28, 2001, the Board of Directors of the Fund declared dividends of $.200, $.607 and $.855 per share from ordinary income, short-term capital gains and long-term capital gains, respectively, payable December 17, 2001 to shareholders of record as of December 10, 2001. - -------------------------------------------------------------------------------- 8 Financial Highlights (Unaudited) FIRST FINANCIAL FUND, INC. - --------------------------------------------------------------------------------
Six Months Ended Year Ended March 31, September 30, ------------------------------------------------------------ 2001 2001 2000 1999 1998 1997 ------------- -------- -------- -------- -------- -------- PER SHARE OPERATING PERFORMANCE: Net asset value, beginning of period............. $ 12.86 $ 8.72 $ 8.85 $ 18.94 $ 15.26 $ 13.71 ------------- -------- -------- -------- -------- -------- Income from investment operations Net investment income............................ .10 .14 .12 .11 .14 .22 Net realized and unrealized gain (loss) on investments................................... 1.27 4.09 (.20) (7.20) 6.84 4.84 ------------- -------- -------- -------- -------- -------- Total from investment operations.............. 1.37 4.23 (.08) (7.09) 6.98 5.06 ------------- -------- -------- -------- -------- -------- Less dividends and distributions Dividends from net investment income............. -- (.10) (.08) (.05) (.14) (.21) Distributions from net realized gains............ -- -- -- (2.59) (2.68) (3.36) Distributions in excess of net realized gains.... -- -- -- (.45) (.63) -- ------------- -------- -------- -------- -------- -------- Total dividends and distributions............. -- (.10) (.08) (3.09) (3.45) (3.57) ------------- -------- -------- -------- -------- -------- Increase resulting from Fund share repurchase.... .05 .01 .03 -- -- .06 Net change resulting from the issuance of Fund shares........................................ -- -- -- .09 .15 -- ------------- -------- -------- -------- -------- -------- Net asset value, end of period(a)................ $ 14.28 $ 12.86 $ 8.72 $ 8.85 $ 18.94 $ 15.26 ------------- -------- -------- -------- -------- -------- ------------- -------- -------- -------- -------- -------- Market price per share, end of period(a)......... $ 11.88 $ 11.29 $ 7.8125 $ 7.3125 $ 20.813 $ 14.50 ------------- -------- -------- -------- -------- -------- ------------- -------- -------- -------- -------- -------- TOTAL INVESTMENT RETURN(b):...................... 5.23% 49.40% 7.93% (53.65)% 72.59% 42.10% RATIOS/SUPPLEMENTAL DATA: Net assets, end of period (000).................. $ 341,493 $315,392 $214,662 $221,881 $387,852 $270,496 Average net assets (000)......................... $ 340,668 $258,156 $230,163 $296,740 $320,484 $238,967 Ratios to average net assets: Expenses, before loan interest, commitment fees and nonrecurring expenses............. .97%(c) 1.09% 1.06% .94% .91% 1.03% Total expenses................................ 1.03%(c) 2.12% 2.20% 1.61% 1.25% 1.56% Net investment income......................... 1.32%(c) 1.33% 1.33% .91% .82% 1.43% Portfolio turnover rate.......................... 59% 85% 63% 65% 43% 70% Total debt outstanding at end of period (000 omitted)...................................... $ -- $ -- $ 45,000 $ 45,000 $ 20,000 $ 18,400 Asset coverage per $1,000 of debt outstanding.... $ -- $ -- $ 5,768 $ 5,931 $ 20,393 $ 15,701
- --------------- (a) NAV and market value are published in The Wall Street Journal each Monday. (b) Total investment return is calculated assuming a purchase of common stock at the current market value on the first day and a sale at the current market value on the last day of each period reported. Dividends and distributions are assumed for purposes of this calculation to be reinvested at prices obtained under the dividend reinvestment plan. This calculation does not reflect brokerage commissions. (c) Annualized. Contained above is selected data for a share of common stock outstanding, total investment return, ratios to average net assets and other supplemental data for the period indicated. This information has been determined based upon information provided in the financial statements and market price data for the Fund's shares. - -------------------------------------------------------------------------------- See Notes to Financial Statements. 9 Supplemental Proxy Information (Unaudited) FIRST FINANCIAL FUND, INC. - -------------------------------------------------------------------------------- The annual meeting of shareholders of First Financial Fund, Inc. was held on August 30, 2001 at the offices of Prudential Investments LLC, 100 Mulberry Street, Newark, New Jersey. The meeting was held for the following purposes:
(1) To elect the following director to serve as follows: Director Class Term Expiring ------------------------------- ------ --------- --------- Richard I. Barr III 3 years 2004 Directors whose term of office continued beyond this meeting are Eugene C. Dorsey, Robert E. LaBlanc, Thomas T. Mooney and Clay T. Whitehead.
The results of the proxy solicitation on the above matter were as follows:
Director/Auditor Votes For Votes Against Votes Withheld Abstentions ---------------------------------- ----------- -------------- --------------- ------------ (1) Richard I. Barr 22,776,174 -- 483,084 --
Other Information FIRST FINANCIAL FUND, INC. - -------------------------------------------------------------------------------- Dividend Reinvestment Plan. Shareholders may elect to have all distributions of dividends and capital gains automatically reinvested in Fund shares (Shares) pursuant to the Fund's Dividend Reinvestment Plan (the Plan.) Shareholders who do not participate in the Plan will normally receive all distributions in cash paid by check in United States dollars mailed directly to the shareholders of record (or if the shares are held in streetname or other nominee name, then to the nominee) by the custodian, as dividend disbursing agent, unless the Fund declares a distribution payable in shares, absent a shareholder's specific election to receive cash. Shareholders who wish to participate in the Plan should contact the Fund at (800) 451-6788. State Street Bank and Trust Co. (the Plan Agent) serves as agent for the shareholders in administering the Plan. After the Fund declares a dividend or a capital gains distribution, if (1) the market price is lower than net asset value, the participants in the Plan will receive the equivalent in Shares valued at the market price determined as of the time of purchase (generally, following the payment date of the dividend or distribution); or if (2) the market price of Shares on the payment date of the dividend or distribution is equal to or exceeds their net asset value, participants will be issued Shares at the higher of net asset value or 95% of the market price. If the Fund declares a dividend or other distribution payable only in cash and the net asset value exceeds the market price of Shares on the valuation date, the Plan Agent will, as agent for the participants, receive the cash payment and use it to buy Shares in the open market. If, before the Plan Agent has completed its purchases, the market price exceeds the net asset value per share, the Plan Agent will halt open-market purchases of the Fund's shares for this purpose, and will request that the Fund pay the remainder, if any, in the form of newly-issued shares. The Fund will not issue Shares under the Plan below net asset value. There is no charge to participants for reinvesting dividends or capital gain distributions, except for certain brokerage commissions, as described below. The Plan Agent's fees for the handling of the reinvestment of dividends and distributions will be paid by the Fund. There will be no brokerage commissions charged with respect to shares issued directly by the Fund. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent's open market purchases in connection with the reinvestment of dividends and distributions. The automatic reinvestment of dividends and distributions will not relieve participants of any federal income tax that may be payable on such dividends or distributions. The Fund reserves the right to amend or terminate the Plan upon 90 days' written notice to shareholders of the Fund. Participants in the Plan may withdraw from the Plan upon written notice to the Plan Agent or by telephone in accordance with specific procedures and will receive certificates for whole Shares and cash for fractional Shares. All correspondence concerning the Plan should be directed to the Plan Agent, State Street Bank & Trust Company, P.O. Box 8200, Boston, MA 02266-8200. - -------------------------------------------------------------------------------- 10 Directors Richard I. Barr Eugene C. Dorsey Robert E. LaBlanc Thomas T. Mooney Clay T. Whitehead Investment Adviser Wellington Management Company, LLP 75 State Street Boston, MA 02109 Administrator Prudential Investments LLC Gateway Center Three 100 Mulberry Street Newark, NJ 07102-4077 Custodian and Transfer Agent State Street Bank and Trust Company One Heritage Drive North Quincy, MA 02171 Independent Accountants PricewaterhouseCoopers LLP 1177 Avenue of the Americas New York, NY 10036 Legal Counsel Kirkpatrick & Lockhart LLP 1800 Massachusetts Avenue, N.W. Washington, D.C. 20036 Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940 that the Fund may purchase, from time to time, shares of its common stock at market prices. The accompanying financial statements as of 9/30/01 were not audited and, accordingly, no opinion is expressed on them. The views expressed in this report and the information about the Fund's portfolio holdings are for the period covered by this report and are subject to change thereafter. This report is for stockholder information. This is not a prospectus intended for use in the purchase or sale of Fund shares. First Financial Fund, Inc. Gateway Center Three 100 Mulberry Street Newark, NJ 07102-4077 For information call toll-free (800) 451-6788 320228109 -----END PRIVACY-ENHANCED MESSAGE-----