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PRUDENTIAL TAX-MANAGED FUNDS
(the Fund)
AMENDED AND RESTATED PLAN PURSUANT TO RULE 18F-3
The Fund hereby adopts this plan pursuant to Rule 18f-3 under the
Investment Company Act of 1940 (the 1940 Act), setting forth the separate
arrangement and expense allocation of each class of shares in each investment
portfolio (each a Portfolio). Any material amendment to this plan is subject to
prior approval of the Board of Trustees, including a majority of the independent
Trustees.
CLASS CHARACTERISTICS
CLASS A SHARES: Class A shares are subject to a high initial sales
charge and a distribution and/or service fee pursuant to
Rule 12b-1 under the 1940 Act (Rule 12b-1 fee) not to
exceed .30 of 1% per annum of the average daily net assets
of the class. The initial sales charge is waived or reduced
for certain eligible investors.
CLASS B SHARES: Class B shares are not subject to an initial sales charge
but are subject to a high contingent deferred sales charge
(declining from 5% to zero over a six-year period) which
will be imposed on certain redemptions and a Rule 12b-1
fee not to exceed 1% per annum of the average daily net
assets of the class. The contingent deferred sales charge
is waived for certain eligible investors. Class B shares
automatically convert to Class A shares approximately seven
years after purchase.
CLASS C SHARES: Class C shares issued before November 2, 1998 are not
subject to an initial sales charge but are subject to a 1%
contingent deferred sales charge which will be imposed on
certain redemptions within the first 12 months after
purchase and a Rule 12b-1 fee not to exceed 1% per annum
of the average daily net assets of the class. Class C
shares issued on or after November 2, 1998 are subject to a
low initial sales charge and a 1% contingent deferred sales
charge which will be imposed on certain redemptions within
the first 18 months after purchase and a Rule 12b-1 fee not
to exceed 1% per annum of the average daily net assets of
the class.
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CLASS Z SHARES: Class Z shares are not subject to either an initial or
contingent deferred sales charge, nor are they subject to
any Rule 12b-1 fee.
INCOME AND EXPENSE ALLOCATIONS
Income, any realized and unrealized capital gains and losses, and
expenses not allocated to a particular class of a Portfolio will be
allocated to each class of such Portfolio on the basis of the net asset
value of that class in relation to the net asset value of the
Portfolio.
DIVIDENDS AND DISTRIBUTIONS
Dividends and other distributions paid by each Portfolio to each class
of shares, to the extent paid, will be paid on the same day and at the
same time, and will be determined in the same manner and will be in the
same amount, except that the amount of the dividends and other
distributions declared and paid by a particular class of the Portfolio
may be different from that paid by another class of the Portfolio
because of Rule 12b-1 fees and other expenses borne exclusively by that
class.
EXCHANGE PRIVILEGE
Holders of Class A Shares, Class B Shares, Class C Shares and Class Z
Shares shall have such exchange privileges as set forth in the
Portfolio's current prospectus. Exchange privileges may vary among
classes and among holders of a Class.
CONVERSION FEATURES
Class B shares will automatically convert to Class A shares on a
quarterly basis approximately seven years after purchase. Conversions
will be effected at relative net asset value without the imposition of
any additional sales charge.
GENERAL
A. Each class of shares shall have exclusive voting rights on any matter
submitted to shareholders that relates solely to its arrangement and
shall have separate voting rights on any matter submitted to
shareholders in which the interests of one class differ from the
interests of any other class.
B. On an ongoing basis, the Trustees, pursuant to their fiduciary
responsibilities
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under the 1940 Act and otherwise, will monitor the Fund for the
existence of any material conflicts among the interests of its several
classes. The Trustees, including a majority of the independent
Trustees, shall take such action as is reasonably necessary to
eliminate any such conflicts that may develop. Prudential Investments
Fund Management LLC, the Fund's Manager, will be responsible for
reporting any potential or existing conflicts to the Trustees.
C. For purposes of expressing an opinion on the financial statements of
each Portfolio of the Fund, the methodology and procedures for
calculating the net asset value and dividends/distributions of the
Fund's several classes and the proper allocation of income and expenses
among such classes will be examined annually by the Fund's independent
auditors who, in performing such examination, shall consider the
factors set forth in the relevant auditing standards adopted, from time
to time, by the American Institute of Certified Public Accountants.
Date: December 8, 1998,
as amended and
restated on
December 21, 1999
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